Commons Sitting of 4 November 1969

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS

  GLASGOW CORPORATION ORDER CONFIRMATION BILL
  The House, according to Order, proceeded to consider the Glasgow Corporation Order Confirmation Bill
  Bill to be read the Third time Tomorrow.

ORAL ANSWERS TO QUESTIONS
  NATIONAL FINANCE

    50p Piece
    Earl of Dalkeithasked the Chancellor of the Exchequer what was the cost of producing 120 million 50p coins including plant, machinery and labour, but excluding the cost of the raw material.
    The Financial Secretary to the Treasury (Mr. Dick Taverne): A very small proportion of the nominal value of the coins.
    Earl of Dalkeith: Would not the hon. and learned Gentleman, with the wisdom of hindsight, admit that the Government have made an expensive blunder and seek to redeem it by withdrawing all these coins, melting them down, and making a profit out of the fivefold rise in nickel prices since minting began and issue instead a paper note of equivalent value?
    Mr. Taverne: Specifications of the coin were very carefully considered by the Decimal Currency Board. A new coin has always proved unpopular, and we should wait to see how this coin is accepted.
    Mr. Higgins: Was not that an intolerably vague answer? Surely the Government must know the answer to the Question. Why will not the Minister give it?
    Mr. Taverne: If the hon. Gentleman is referring to the first reply which I gave, he will realise that the Mint is in competition with overseas competitors, and it has never been customary to disclose the cost of manufacture of any particular coin.
    Earl of Dalkeithasked the Chancellor of the Exchequer how many 50p coins have been put into circulation to date; and what was the cost of their distribution.
    Mr. Taverne: Approximately 126 million 50p coins had been issued to the banks up to 31st October. The cost of distribution borne by the Mint is approximately £24,000.
    Earl of Dalkeith: But if the cost of producing more paper notes over a longer period is the decisive factor in switching to metal coins, would the Minister explain why he does not carry the argument to its logical conclusion and replace the £ note with a metal coin?
    Mr. Taverne: We must have regard to the value of the coin and to the savings which accrue from having a metal coin instead of a note.
    Mr. John Smith: Would the hon. and learned Gentleman bear in mind that the new 10s. coin is not at all a bad coin but that what is wrong is that the new 10p and 5p pieces are far too large and that they are more than four times as heavy in terms of weight per value than any other currency in the world except one?
    Mr. Taverne: The difficulty about the hon. Gentleman's suggestion, which in itself has quite a lot to be said for it, is that quite a number of complaints about the new coin are that it is too small.
    Earl of Dalkeith: On a point of order. In view of the unsatisfactory nature of the reply, I beg to give notice that I shall seek to raise the matter on the adjournment at the earliest possible opportunity.
    Mr. Leadbitterasked the Chancellor of the Exchequer what representations he has received on the shape and size of the new 50p coin; and what reply he has sent.
    Mr. Buchanan-Smithasked the Chancellor of the Exchequer what representations he has received about the new 50p coin; and if he will make a statement.
    Mr. Taverne: I would refer the hon Members to my reply to the hon. Member for Inverness (Mr. Russell Johnston) on 3rd November.
    Mr. Leadbitter: Will my hon. and learned Friend bear in mind that this coin is unpopular? It has been the subject of considerable public criticism. It certainly is confusing and possibly invites counterfeiting. In view of the obduracy of the Decimal Currency Board and the public's general concern, would it not be better if the Government were to indicate their willingness to review the matter?
    Mr. Taverne: Only a very small proportion of the letters we have received refer to cases where the writers have seen a mistake made. I am aware that this is an unpopular coin at the moment, but the Board went into the matter very fully. The coin, as earlier new coins when introduced, must be given a chance.
    Mr. Buchanan-Smith: Does not the hon. and learned Gentleman recognise that it is particularly in the retail trade, where people have practical daily experience of handling the coin, that the most complaint arises because of the confusion? In examining these complaints, I ask the hon. and learned Gentleman not to be insensitive to the very practical experience of these people.
    Mr. Taverne: It is not for me to examine the complaints. It is for the Board to do that. These must be carefully examined. We must wait and see. In the course of consultations and researches, which were far more elaborate than occurred with the launching of any other new coin, the Board specifically made inquiries and consulted retail organisations.
    Mr. A. Royleasked the Chancellor of the Exchequer if he will now instruct the Decimal Currency Board to with-
    804
    draw the 50p coin and replace it with a well designed note in view of the dangerous impracticability of the new coin.
    Mr. Roebuckasked the Chancellor of the Exchequer whether, in the light of public reaction to the 50p piece, he will now enter into consultations with the Decimal Currency Board with a view to producing a coin more easily distinguishable from the 10p piece.
    Mr. J. H. Osbornasked the Chancellor of the Exchequer whether he will circulate a 50p note, as well as the 50p coin.
    Mr. Farrasked the Chancellor of the Exchequer if he will withdraw the new 50p piece from circulation and retain the 10s. note.
    Mr. Taverne: I would refer the hon. Member to the reply which my hon. Friend the Minister of State gave in reply to the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) on 22nd October.—[Vol. 788, c. 298-9.]
    Mr. Royle: Will the hon. and learned Gentleman ask the Board to look at the whole matter again? Will he ask the Board to see if it would be possible to have a note as well as a coin and then assess the public reaction to the two different types of currency?
    Mr. Taverne: At the moment there is a note as well as a coin. However, the hon. Gentleman is right, in that the note will be withdrawn. The reason for introducing the coin in the first place was that it will bring about a substantial saving in cost. In due course there is no reason why this coin should not become accepted in the way that other coins have been accepted.
    Mr. Roebuck: What sort of representation does my hon. Friend want before he agrees to examine the matter again? Have not the Licensed Victuallers Association, the shopkeepers' organisation, the pensioners, the housewives, and the hon. Member for Harrow, East written to him about this? Has he not studied the sheaf of letters which I have sent to him and which have arrived from all across the country? Why is it that he will listen so long to the antique and counterfeit peers on the Board and not listen to the voice

    805
    of the people? Will he reconsider the matter?
    Mr. Taverne: Experience with the 3d. bit and with the florin showed that time was required, and it would be a very mistaken reaction, just because there is an immediate unfavourable reaction to the coin, for the Board to say that the reaction to the coin, for the Board to say that the reaction to the coin will necessarily be unfavourable in six months' time.
    Mr. Osborn: It is my view that this 50p piece should be given a chance and then perhaps the British people will get used to it. However, would it not have been more helpful if we could have had a guarantee that the 10s. note would be continued while people were growing accustomed to the new coin? Is it not a great mistake not to have ready availability of 10s. notes?
    Mr. Taverne: The whole point of the operation is to save costs. If we had plans for continuing with the circulation of 10s. notes, saving would not take place.
    Mr. Farr: What representations did the Minister make to the retail bodies to which he referred? Were they given specimens of the new coins?
    Mr. Taverne: Certainly. It is not any of my business, nor that of the Government, to make these inquiries and representations. That is a matter for the Board. The Board consulted, and showed the coin to, retail organisations, transport organisations, cash handling organisations, cash handling organisations, slot machine manufacturers, consumer organisations, and associations for the blind.
    Mr. Iain Macleod: The Financial Secretary will be aware from his postbag and from questions asked by hon. Members on both sides of the House of the dislike of this coin that exists at the moment. If this dislike continues, will he undertake to withdraw the coin, or is his mind completely closed?
    Mr. Taverne: We must see over a considerable period of time how this progresses.
    Mr. Dempsey: Is my hon. and learned Friend aware that it is not necessary to wait for a considerable period? Only last week a Scottish television programme showed that a survey conducted of all interests, from shopkeepers to house-
    806
    wives, had condemned the coin. Why should we be dragged behind the archaic members of this Board instead of a correction being made now, because the Board has obviously made a mistake?
    Mr. Taverne: I have studied the representations. Only a minority of the representations were opposed to a coin as distinct from a note. As for the objections to the type of coin, there were many different objections which all led to a different kind of coin being apparently more acceptable.
    Mr. Royle: On a point of order. In view of the unsatisfactory nature of that reply, I beg to give notice that I will raise the matter on the Adjournment at the earliest possible moment.
    Mr. Wingfield Digbyasked the Chancellor of the Exchequer what steps were taken to sound public opinion on the 50p before its issue; and what has been the total cost of it to public funds to date.
    Mr. Taverne: The Decimal Currency Board considered a number of possible specifications for the 50p and sought the opinion of representative organisations concerned with the use and handling of coins. They also had coin recognition tests carried out. It is not the practice to divulge details of coinage costs, because this information would be useful to the Royal Mint's overseas competitors.
    Mr. Digby: Is not it quite obvious that there was a complete failure to anticipate public opinion, and is not the 5 new franc piece a comparable example in that it is not popular in France in competition with the 5 new franc note, although it is much more identifiable because the other coins are smaller? Was not that the writing on the wall which might have been seen?
    Mr. Taverne: As I have already explained to the House, there were a number of precedents which all suggested that at first any new coin would be unpopular, but no coin has ever previously been issued with such elaborate research and consultation as was undertaken by the Decimal Currency Board on this coin.
    Mr. Rankin: Does my hon. Friend realise that, if he will promise to keep up the purchasing value of this new coin, he will have taken one of the most popular steps he has ever taken?
    Mr. Taverne: I take note of that.
    Mr. Higgins: The Financial Secretary repeatedly refers to tests being carried out, but has not once said what were the results of those tests. Why does he give priority to these secret tests rather than to the public opinion which has been so clearly expressed by hon. Members on both sides of the House?
    Mr. Taverne: The hon. Member has failed to take the point that one thing which is required for public reaction generally is time. Tests taken with housewives showed, among other things, that they had no difficulty in recognising the new coin. The retail, the cash handling and other consumer organisations in fact preferred this particular specification of coin to its rivals.
    Mr. J. H. Osbornasked the Chancellor of the Exchequer if, from information available to him from international sources, he will list the values of the coins, indicating size and weight, and notes in common circulation in each of the major countries in Europe, respectively; what is their equivalent value in the new British decimal currency; and how these compare in value with the decimal coins and notes to be circulated in this country.
    Mr. Taverne: With permission, I will circulate in the OFFICIAL REPORT a list of the coins and notes in circulation in those countries of Western Europe which have a population of over 10 million. The list indicates in millimetres and grammes the size and weight of each coin and the approximate present value in United Kingdom decimal currency of both coins and notes. In the time available, it has not been possible to establish whether all these coins and notes are in everyday use.
    Mr. Osborn: May we be given information about the comparability of value for weight of comparable coins to the 50p piece, and is the Financial Secretary satisfied that this information has already been sufficiently circulated?
    Mr. Taverne: I hope that the hon. Member will have regard to the details which will be circulated in the OFFICIAL REPORT and which should give him this information.
    Following is the information"

    FRANCE

    Coinage

    France centimes

    1

    23·00/1·4

    1·3

    ·1p

    1

    15·00

    1·65

    2

    27·00/1·9

    2·2

    ·2p

    5

    17·00

    2·0

    ·4p

    10

    20·00/1·7

    3·0

    ·8p

    10

    20·00

    3·0

    20

    23·50/1·7

    4·0

    1·5p

    20

    23·50

    4·0

    Francs

    ½

    19·50

    4·5

    3·7p

    1

    24·00/1·9

    6·0

    7·5p

    5

    29·00/2·2

    12·0

    38·0p

    10

    37·00

    25·00

    75p

    Notes

    Francs

    5

    38p

    10

    75p

    50

    £3·75

    100

    £7·50

    500

    £37·50

    WEST GERMANY

    Coinage

    Pfennig

    1·35

    1

    16·50/1·38

    2·0

    ·1p

    2

    19·25/1·52

    3·25

    ·2p

    5

    18·50/1·7

    3·0

    ·6p

    10

    21·50/1·7

    4·0

    1·1p

    50

    20·00/1·58

    3·5

    5·7p

    D. Mark

    1

    23·50/1·75

    5·5

    11·4p

    2

    26·75/1·79

    7·0

    22·8p

    5

    29·00/2·07

    11·2

    57·0p

    Notes

    D. Mark

    5

    57

    10

    £1·14

    20

    £2·28

    50

    £5·70

    100

    £11·40

    500

    £57·00

    1,000

    £114·00

    ITALY

    Coinage

    Lira

    1

    17·20/1·2

    0·625

    less than

    ·1p

    2

    18·30/1·4

    0·8

    ·1p

    5

    20·20/1·5

    1·0

    ·3p

    10

    23·30/1·6

    1·6

    ·7p

    20

    21·30/1·6

    3·6

    1·3p

    50

    24·80/2·0

    6·25

    3·3p

    100

    27·80/2·0

    8·0

    6·7p

    500

    29·00/2·2

    11·0

    33·0p

    Notes

    500

    33p

    1,000

    67p

    5,000

    £3·30

    10,000

    £6·60

    50,000

    £33·30

    100,000

    £66·60

    809

    SPAIN

    Coinage

    Centimos

    10

    17·50/1·19

    0·75

    ·1p

    50

    20·00/1·48

    4·0

    ·3p

    50

    20·00/1·25

    1·0

    ·3p

    Pesetas

    1

    21·00/1·33

    3·5

    ·6p

    2½

    25·00/1·87

    7·0

    1·5p

    5

    23·00/1·56

    5·57

    3·0p

    25

    26·50/1·73

    8·5

    15·0p

    50

    30·00/1·98

    12·5

    30·0p

    100

    34·00/2·08

    19·0

    60·0p

    Notes

    Pesetas

    1

    ·6p

    2

    1·2p

    5

    3·0p

    10

    6·0p

    25

    15·0p

    50

    30·0p

    100

    60·0p

    500

    £3·00

    1,000

    £6·00

    TURKEY

    Coinage

    Kuras

    5

    17·00/1·35

    2·5

    ·2p

    10

    21·00/1·7

    4·0

    ·5p

    25

    22·60/1·75

    5·0

    1·2p

    Liras

    1

    27·00/2·4

    8·0

    4·6p

    2½

    30·00/2·7

    12·0

    11·6p

    10

    34·00/1·6

    15·0

    46·0p

    Notes

    Liras

    5

    23p

    10

    46p

    20

    93p

    50

    £2·31

    100

    £4·63

    500

    £23·15

    1,000

    £46·30

    UNITED KINGDOM

    £ s. d. Coinage

    Pence

    1

    30·86/1·91

    9·449

    ·41p

    3

    21·97/2·79

    6·804

    1·25p

    6

    19·40/1·4

    2·827

    2·50p

    Shillings

    1

    23·59/1·73

    5·6652

    5·0p

    2

    28·50/2·31

    11·3104

    10·0p

    Half-crown

    32·31/2·31

    14·1379

    12·5p

    New Pence

    ½

    17·14/1·1

    1·7820

    1

    20·32/1·5

    3·5640

    2

    25·91/1·8

    7·1280

    5

    same as for the

    1 shilling coin

    10

    same as for the

    2 shilling coin

    50

    30·00/2·5

    13·5000

    Notes

    Shillings

    10

    Pounds

    1

    5

    10

    20*

    *To be introduced before 15th February, 1971.

    Money Supply
    Mr. Sheldonasked the Chancellor of the Exchequer what is the present policy of the Government on the supply of money.
    The Chancellor of the Exchequer (Mr. Roy Jenkins): As I stated in my Budget speech, and have repeated on a number of occasions since, it is our policy to maintain a close control over money supply and domestic credit expansion in the interests of our overall economic objectives.
    Mr. Sheldon: Since the domestic credit expansion is less than that given in the Letter of Intent to the International Monetary Fund, would my right hon. Friend see whether he can allow some selective expansion, preferably by bringing the repayment periods for investment grants nearer and thus stimulating investment in plant and machinery?
    Mr. Jenkins: I do not want to anticipate too much Question No. 5 put down by my hon. Friend the Member for Heywood and Royton (Mr. Barnett) which bears more directly on this matter, but the figure given in the Letter of Intent related only to an expansion over the financial year as a whole. Therefore, my hon. Friend's deduction is a little premature. However, I will bear his suggestion in mind.
    Mr. Cant: As the joint Treasury Bank of England paper to the Hove conference admitted that demand management policy is virtually bankrupt post-Radcliffe, is there not a case for giving money supply a chance? If my hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) is worried about money supply, should not he be more worried about the increase in money supply last December rather than the fall in money supply this year?
    Mr. Jenkins: There is something in that. I have tried to give money supply, rechristened and modified somewhat to "domestic credit expansion", a chance this year, and it seems to have taken its chance fairly well so far.

    Balance of Payments
    Mr. Sheldonasked the Chancellor of the Exchequer what estimate he has

    811
    made of the out-turn of the balance of payments for 1969.
    Mr. Roy Jenkins: I do not propose at this stage to make any fresh estimate of future out-turn. So far, however, our progress looks satisfactory towards all announced balance of payments targets.
    Mr. Sheldon: I warmly congratulate my right hon. Friend on the progress made with the balance of payments, but would he say whether there is any possibility of withdrawing from some of the commitments entered into in the Letter of Intent in view of the present satisfactory position?
    Mr. Jenkins: I do not think that that arises. I am not aware of any constraints imposed upon me by the Letter of Intent which I would not wish to be there and which I would not think right in the interests of pursuing the policies which have achieved the substantial improvement in our position.
    Sir F. Bennett: Can the right hon. Gentleman clarify his first answer, in view of what he said yesterday and in the light of the interpretation in the newspapers today? Did he say yesterday that the monthly rate, if maintained, would produce an annual surplus of £500 million, or was he saying what many of the headlines are saying, that we would in fact achieve a £500 million Surplus this financial year ending next April?
    Mr. Jenkins: It is not my impression that any newspaper has said that we would achieve a surplus this financial year. What I said in fact was that it looked to me as though the out-turn for the second and third quarters, which are now past, would together give an annual rate of £500 million a year. I am always very cautious about predicting the future.

    Domestic Credit Expansion
    5. Mr. Barnettasked the Chancellor of the Exchequer if he will make a statement on the present level of domestic credit expansion; and how this compares with the figure referred to in the Letter of Intent.
    Mr. Roy Jenkins: The Letter of Intent referred to a figure for domestic credit expansion of not more than £400 million in the financial year 1969–70. In the quarter ended 30th June, domestic credit
    812
    is estimated to have contracted by some £75 million. This is not, of course, necessarily inconsistent with a net expansion for the year as a whole.
    Mr. Barnett: If my right hon. Friend decides to change the emphasis and allow domestic credit expansion to reach the £400 million target, has he made any estimate as to how quickly it will have an impact on economic activity?
    Mr.Jenkins: There are substantial seasonal factors in this development. We should not judge the position for the year as a whole until we see how it develops. I assure the House that I am watching this matter very carefully indeed and that I am anxious that we shall keep, as we have been keeping, a proper control to achieve our objective, but not an unnecessarily tight degree of control.
    Mr. Bruce-Gardyne: Was it not almost as foolish to have totally neglected the rise in money supply in 1968 as it is to go to exaggerated lengths in the opposite direction in the current financial year?
    Mr. Jenkins: As on so many occasions, I would not agree with the hon. Gentleman.

    Interest Rates
    6. Mr. Barnettasked the Chancellor of the Exchequer if he will carry out an investigation into the current level of interest rates charged by joint stock banks, merchants banks, finance houses and other companies in this field.
    The Chief Secretary to the Treasury (Mr. John Diamond): I do not think such an investigation would be useful.
    Mr. Barnett: Is my right hon. Friend aware that there are some companies charging very exorbitant rates of interest, taking advantage of the current situation, and that this is having a particularly harmful effect on small companies which, by the very nature of things, are predominant in development areas where they seek to take advantage of Government incentives? Will my right hon. Friend reconsider his answer?
    Mr. Diamond: No, Sir. My hon. Friend asks me in the Question whether an investigation will be helpful. I do not think that it would be. My hon. Friend is quoting cases of which he is

    813
    aware without investigation and which reflect to a certain extent the market rates.
    Sir A. V. Harvey: If the right hon. Gentleman carried out an investigation, he might find it enlightening. A great many firms, even some in development areas, which have to import materials, frequently for re-export, are now faced with the financing of import deposits and are having to face this extraordinarily high rate which they never expected to pay for the current year.
    Mr. Diamond: We were aware of those circumstances, and the result is contained in what my right hon. Friend said in answer to the previous Question.

    Foreign Travel Allowance
    Miss Quennellasked the Chancellor of the Exchequer whether he will amend the £50 foreign currency allowance to enable £100 to be drawn every two years, instead of the present rigid annual ration.
    Mr. Taverne: No, Sir. My right hon. Friend hopes to be able to abolish the restrictions as soon as circumstances permit.
    Miss Quennell: Yes, but does not the Financial Secretary realise that although his right hon. Friend said on 21st October that he would keep the scheme under continuous review he now seems to have closed his mind entirely to amending thescheme—to enable British travellers perhaps to take advantage of the Oberammergau season, from which next summer the parity between the German and our British currencies practically excludes British travellers?
    Mr. Taverne: I make two answers to the hon. Lady. First of all, to achieve a balance of payments, saving can be more readily done on the basis of an annual allowance rather than on a larger allowance spread over a longer period; and secondly, if it should prove possible to end the restriction earlier, then, of course, those who postponed their holidays would accordingly have suffered.
    Mr. Boyd-Carpenterasked the Chancellor of the Exchequer whether he will now increase the £50 travel allowance.
    Mr. Taverne: No, Sir.
    Mr. Boyd-Carpenter: How does the hon. and learned Gentleman reconcile the exuberant optimism shown by the Chancellor of the Exchequer yesterday with the maintenance over a further year of a restriction which can only be justified either to our friends abroad or our people at home by the existence of a crisis?
    Mr. Taverne: My hon. Friend has just said that he does not like making predictions, and he has said that it would be unwise at a time when we have this welcome surplus to abandon straight away measures which have made some contribution to this welcome development.
    Mr. Henig: Is my hon. and learned Friend not aware that the £50 plus £15 English currency plus the cost of travelling is considerably in excess of the requirements of the average person taking a holiday abroad from this country, and will he therefore resist this class-interest pressure from the other side?
    Mr. Taverne: I am aware of what my hon. Friend says, but I would not go quite as far as he does because I certainly recognise, and my right hon. Friend recognises, that this is in itself an unattractive restriction which he does want to end as soon as possible.
    Sir R. Cary: Surely some modest increase of £10 or £15 would be justified in view of the texture of the speech made by the Chancellor of the Exchequer yesterday?
    Mr. Taverne: This is one of the matters which my right hon. Friend has under review.

    Tax Revenue
    Mr. Edward M. Taylorasked the Chancellor of the Exchequer what estimate he has made of the total tax revenue in the current financial year; and by what Percentage this exceeds the actual tax revenue in 1963–64.
    Mr. Diamond: I have nothing to add to the answer which I gave to the hon. Gentleman on 20th May, 1969.—[Vol. 784, c. 222-3.]
    Mr. Taylor: Why will not the Minister state the figures? Would he agree that tax revenue has more than doubled in six

    815
    years, and this despite the Prime Minister's pledge that the Government could carry out their programme without any general increase in taxation? Is he aware that successive tax increases are putting more and more people into the position of being as well off not working as working?
    Mr. Taverne: In the answer I gave the hon. Gentleman I actually gave the figures precisely and clearly; I gave them gross and I gave them by way of sensible comparison, and made it clear that if we make appropriate allowances so as to compare like with like and take into account increases in incomes the increase in taxation works out at about 4 per cent. per annum on average.

    Management and Investment Companies (Management Expenses)
    Mr. Donald Williamsasked the Chancellor of the Exchequer how many cases were settled by the General Commissioners and by the Special Commissioners in 1967 and 1968 in respect of the amount payable to directors and allowable for corporation tax purposes in respect of management and investment companies.
    Mr. Diamond: Appeals in respect of relief for management expenses by management and investment companies lie only to the Special Commissioners. The number of such cases settled by the Special Commissioners in 1967 and 1968 is not readily available.
    Mr. Williams: Would not the Chief Secretary agree that this is a function of evaluating awards, and would it not be more appropriately sent to the Prices and Incomes Board or to the Department of Employment and Productivity rather than to the Special Commissioners?
    Mr. Diamond: No, I would not. I do not see the relevance of that. This is a matter of what expenses are appropriately deductible for tax purposes.

    Giro (Payment of Taxes)
    Mr. Donald Williamsasked the Chancellor of the Exchequer how much it has cost to print and insert invitations to pay taxes due through the National Giro System.
    Mr. Taverne: The cost to date has been about £19,000.
    Mr. Williams: Would not the Financial Secretary agree that this is a rather expensive way of advertising the use of the new Giro system? Is he able to say how many people have been taking advantage of or using this method of paying their taxes?
    Mr. Taverne: It is not an expensive method of advertising, because it can produce in due course a considerable saving. It is too early to say how many have taken advantage of it, but I can tell the hon. Member that some 80,000 employers have said that they would like to take advantage of the facility when it is extended to P.A.Y.E. next April, and this would indicate a very considerable advantage indeed.

    Scottish Budget
    Mr. Bruce-Gardyneasked the Chancellor of the Exchequer what estimate he has made of the cost to public funds of preparing the details of the Treasury's Scottish budget.
    Mr. Diamond: Departments have not kept a detailed record of their work on this question, but I estimate that the total cost was rather more than £3,000.
    Mr. Bruce-Gardyne: That figure should be treated with the same sort of reservation as is made about some of the figures in the budget itself, but would the right hon. Gentleman give us any idea of the amount of time taken by firms in answering the questionnaire for the purpose of this exercise? Can he say what specific purpose this whole exercise has served?
    Mr. Diamond: The hon. Gentleman asked me what was the cost to public funds, and I have given him the answer —the cost to public funds. Therefore, I have not to deal with the other irrelevant points he has just put to me.
    Mrs. Ewing: Was it considerations of cost by the Labour Government and their predecessors which prevented them from publishing a Scottish budget over the last 17 years, or was there some other reason?
    Mr. Diamond: I cannot accept responsibility for everything which has gone on in this House over the last 17 years.

    Import Deposits
    Mr. Bruce-Gardyneasked the Chancellor of the Exchequer what adjustments to his forecast of domestic credit expansion contained in paragraph 9 of his letter of intent to the International Monetary Fund he expects to result from his decision to seek authority for renewal of the import deposits scheme.
    Mr. Roy Jenkins: As I said in the House on 21st October, there is no way of quantifying the precise effect of import deposits, but the continuance of the scheme is a new factor to be taken into account in considering the course of domestic credit expansion.
    Mr. Bruce-Gardyne: On that occasion, 21st October, the Chancellor seemed to infer that he was continuing this scheme because the banks had failed to keep down to their lending ceiling. Is he not aware that most authorities regard the lending ceiling of the banks as being completely irrelevant to control of the money supply? Can the right hon. Gentleman tell us how he justifies the additional squeeze when already the Managing Director of the I.M.F. has told us that monetary direction in this country has gone further than the adjustment process really requires?
    Mr. Jenkins: The hon. Member always asks so many questions at once.
    Mr. Bruce-Gardyne: Just answer one or two.
    Mr. Jenkins: I will endeavour to answer one or two or three of them. I do not think it has anything to do with the statement of the Managing Director, which the hon. Gentleman has raised on previous occasions. I think that the continuation of the import deposits scheme at the modified rate was desirable in order to continue to fortify our strongly improving balance of payments position. I do not regard it as necessarily having an increasing effect on the stringency of the credit squeeze, because I am taking it into account with other considerations; nor certainly do I regard the bank ceiling as being irrelevant from the point of view of the total of domestic credit expansion.
    Mr. Higgins: Yes, but arising from the original Question, can the right hon.
    818
    Gentleman say whether he got the agreement of the I.M.F. in terms of the I.M.F. treaty, and if he cannot quantify it, how can he hope to achieve the substantial figures in the Letter of Intent?
    Mr. Jenkins: That which is not quantifiable can none the less have important qualitative results, and the figure set out in the Letter of Intent was a ceiling it is not something which is intended to be precise within £1 million or £2 million or £10 million. I can certainly assure the hon. Gentleman that I have informed Mr. Schweitzer of my intention, and he raised no objection.
    Mr. Cant: Would it not be worth reminding the personal representative of Professor Friedman, in view of the fact that his estimate of money lags varies from six months to 18 months, that my right hon. Friend might be very wise in exerting a little more pressure now and perhaps a little less pressure in 1970?
    Mr. Jenkins: Well, I will certainly bear it in mind. I am not quite sure whom my hon. Friend regards as the personal representative of Professor Friedman. There are several possible alternative candidates for the role. But it is certainly true that, on the whole, I regard monetary management as an art, not a science.
    Mr. Wingfield Digbyasked the Chancellor of the Exchequer what communication he has sent to the Secretary General of the European Free Trade Association about his decision to continue import deposits; and what reply he has received.
    Mr. Richard Wainwrightasked the Chancellor of the Exchequer what explanations he has made to the European Free Trade Association and the General Agreement on Tariffs and Trade about his plans to continue import deposits into 1970.
    Mr. Roy Jenkins: The Secretary General of the European Free Trade Association and the Director General of the General Agreement on Tariffs and Trade were informed on 21st October of the Government's decision to continue the import deposit scheme, and its reasons for so deciding, in the terms in which I informed this House.
    Mr. Digby: Will the Chancellor of the Exchequer bear in mind the importance of restoring the confidence of our valuable E.F.T.A. partners which, as many of us know, has been sadly undermined in recent years?
    Mr. Jenkins: Without necessarily accepting the hon. Gentleman's premises, I certainly think that it is important that we should have good and close relations with E.F.T.A. The most important part in the restoration, if restoration be necessary, and the building up of these relations is the rapid improvement in our foreign trade position in recent months.
    Mr. Wainwright: Will the right hon. Gentleman undertake to see that by the time the House debates the legislation for renewing the import deposits scheme, details of the exchanges with G.A.T.T. and E.F.T.A. on this subject are published to the House?
    Mr. Jenkins: I am not sure whether there will be formal exchanges to publish. There is a Ministerial meeting this week and the matter will be there discussed, but I cannot give any undertaking because I am not sure that there will be any formal exchanges.

    Wealth Taxation
    Mr. Croninasked the Chancellor of the Exchequer what is the policy of Her Majesty's Government with regard to the taxation of privately-owned wealth.
    Mr. Gwilym Robertsasked the Chancellor of the Exchequer what are the latest available estimates for the yield of a uniform 1 per cent., 2 per cent., 3 per cent., or 4 per cent. wealth tax on accumulated wealth of £20,000 or over ; what plans he now has for the introduction of wealth taxation ; and if he will make a statement.
    Mr. Taverne: On the basis of present-day values it is estimated that the yield of a tax at the rates mentioned on the excess over £20,000 of wealth owned by individuals would be £225 million, £450 million, £675 million and £900 million, respectively.
    I cannot say if or when such a tax might be introduced.
    Mr. Cronin: Would not my right hon. Friend agree that it is an anomalous
    820
    situation that about one-third of the country's wealth is owned by about I per cent. of the population, while, at the same time, the working population are enduring a very high rate of direct taxation which, incidentally, from an electoral point of view is causing widespread resentment?
    Mr. Taverne: I cannot confirm the exact figures which my hon. Friend has mentioned. I am aware that there is a need for some redistribution of wealth. I am also aware that there are certain difficulties about this tax.
    Mr. Dickens: As a wealth tax is a commonplace in most other West European countries and bearing in mind the very considerable rise in social inequality in the 1960s in this country, if such a tax would produce the revenue stated by my hon. Friend, why should not we bring it in at a much earlier date than that which the Chancellor of the Exchequer foresees in the early to mid-1970s?
    Mr. Taverne: There are several points involved in that question. First, the practice in different countries varies, with different effects. Secondly, I do not accept from my hon. Friend that there has been a rise in social inequality; there has been some redistribution, if not necessarily as much as one would like to see. The answer to why the tax should not be introduced earlier is that it raises formidable problems of valuation, and if one wanted to introduce the tax a very considerable strain would be placed on the resources of the Inland Revenue which are also already considerably strained.

    Public Sector Purchasing
    Mr. Croninasked the Chancellor of the Exchequer if he will instruct the joint group to be set up by the Government and the nationalised industries on public sector purchasing to investigate the possibility of giving preference to firms with good export records when purchases are made for the public sector and where this has no adverse effect on the public interest.
    Mr. Diamond: The new group will be concerned with standardisation and variety reduction in public sector purchasing. Further progress in these fields should itself be of benefit to exports, but

    821
    I do not think it would be useful to extend the group's terms of reference as suggested.
    Mr. Cronin: Is my right hon. Friend aware that a substantial number of firms have grown large and prosperous on Government contracts and for that reason concern themselves very little with the export market when they could easily do so?
    Mr. Diamond: I do not know whether they could easily do so. I certainly share the implicit view of my hon. Friend that they should endeavour to do so.
    Mr. Iain Macleod: Is the Chief Secretary yet in a position to answer the question which I asked him when he made a statement on this matter as to whether there will be a separate group for local authorities and, if he is not, will he take an opportunity to let the House know fairly soon?
    Mr. Diamond: The answer to the first part of the right hon. Gentleman's question is "Not yet". I certainly undertake to do what he asks in the second part of his question.

    P.A.Y.E. Refunds (Welfare Payments)
    Mr. Brew isasked Chancellor of the Exchequer what is the Inland Revenue procedure for taking into account welfare payments such as wage-related unemployment benefit before making Pay-As-You-Earn refunds.
    Mr. Taverne: National Insurance unemployment benefit and sickness benefit are exempt from tax and are therefore left out of account in making P.A.Y.E. refunds.
    Mr. Brewis: Is not it possible that considerable sums may be paid, with the result that somebody who is not working may earn considerably more than someone who is doing a hard day's work?
    Mr. Taverne: What is behind the hon. Member's question, I think, is that in principle these payments should be taxed, and I think that he is right, but there were formidable administrative and practical difficulties which led to the original decision that they should not be taxed.

    Save-As-You-Earn Scheme
    Mr. Eadieasked the Chancellor of the Exchequer if he is satisfied by the re-
    822
    sponse of industry to the new Save-As-You-Earn scheme; and if he will make a statement.
    Mr. Taverne: Yes, Sir. A complete picture is not yet available but I am encouraged by the response so far.
    Mr. Eadie: My hon. Friend must be aware that we have been given information that in the first month 37 per cent. of the building societies were responsible for new contracts. Bearing in mind this figure, will he give an assurance to the House that industry is giving all possible encouragement to promote the Save-As-You-Earn scheme?
    Mr. Taverne: I am not in a position to give details of building society returns, but I can tell the House that 700 firms have so far agreed to run group schemes for Save-As-You-Earn through the Department for National Savings, others through the Trustee Savings Bank, and this would seem to show an encouraging response.
    Mr. Iain Macleod: Does the Financial Secretary agree that, to a very heavy taxpayer, the yield of the S.A.Y.E. scheme can amount to over 80 per cent.? If he agrees that, will he say how much of the initial response takes the form of switching and is not a net gain?
    Mr. Taverne: Of course I am aware of this, as no doubt was the right hon. Gentleman when he welcomed the scheme. I cannot tell him how far there has been switching, but the fact that the average over-the-counter contract signed through the Department of National Savings amounts to £6–00A3;7 suggests that those applying for the contracts are not perhaps surtax payers.

    Value-Added Tax
    Mr. Dalyellasked the Chancellor of the Exchequer what is his estimate of the demands on inland revenue personnel, consequent on the introduction of a value-added tax.
    Mr. Diamond: I have nothing to add to what my hon. and learned Friend the Financial Secretary said in reply to a similar Question from my hon. Friend the Member for Heywood and Royton (Mr. Barnett) on 29th January, but I would not seriously quarrel with the figure of 8,000 given in the N.E.D.C.

    823
    report on a broad estimate of the numbers required by Customs and Excise to operate a tax stopping at the wholesale stage.
    Mr. Dalyell: Is not this a rather odd suggestion for a party which tells us that we should reduce the number of civil servants?
    Mr. Diamond: It is no more odd than many of the other suggestions made by that party.
    Mr. Dalyellasked the Chancellor of the Exchequer what is his estimate of the effect of the introduction of a value added tax on the price of foodstuffs.
    Mr. Diamond: That would depend on the rates and coverage of the tax.
    Mr. Dalyell: Is it not a fact that this tax would lend itself to fraud in a big way and would involve even more civil servants?
    Mr. Diamond: It is certainly the case that the larger the number of points of collection of the tax the greater the number of individuals engaged in supervising it.
    Mr. Edward M. Taylor: If this tax is such a terrible thing, will the Government assure us that they will never introduce it?
    Mr. Diamond: The hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) is always asking questions to which full and adequate answers have already been given. If he will be good enough to refer to the answers given by my right hon. Friend the Prime Minister and my right hon. Friend and Foreign Secretary, he will find that that question has been fully answered.

    National Savings Bank (Interest Rate)
    Mr. Rankinasked the Chancellor of the Exchequer if he will increase the rate of interest payable to investors in the National Savings Bank to 3½ per cent.
    Mr. Taverne: I have nothing to add to the reply given by my right hon. Friend the then Financial Secretary to my hon. Friend the Member for West Ham, North (Mr. Arthur Lewis) on 23rd July last.
    Mr. Rankin: That is not a very happy Answer. Would my hon. Friend agree that successive Governments over the years have drawn from the small saver something like £5,000 million? Does he not feel that they ought to receive the same encouragement which is given to the large investor at 81 per cent.? Will he not think again about the answer he has given to see whether he can give the small saver the encouragement which he deserves?
    Mr. Taverne: I agree with my hon. Friend that the small saver should be given every encouragement. These particular accounts are treated rather differently. They are often treated as current accounts and there are other different forms of national savings available which give a much higher rate of interest. The Save-As-You-Earn scheme is particularly directed at the small saver and should give him a fair return on his investments.
    Mr. Stratton Mills: How long has the present rate of interest of 2½ per cent. been in operation and what was the Bank Rate at the time of its introduction?
    Mr. Taverne: I should require notice of that question.
    Mr. Rankin: In view of the discouraging and unsatisfactory nature of that answer, I beg leave to raise this matter on the Adjournment at the earliest possible moment.

  RAILWAYS

    Crewe-Glasgow Line (Electrification)
    Mr. Edward M. Taylorasked the Minister of Transport if he has arrived at a decision on the request by British Railways to proceed with the electrification of the main line from Crewe to Glasgow; and if he will make a statement.
    The Joint Parliamentary Secretary to the Ministry of Transport (Mr. Albert Murray): As my right hon. Friend told the hon. Member on 22nd October [Vol. 788, c. 292], he hopes to make a decision shortly.
    Mr. Taylor: While I hope that the decision will be favourable, may I ask the Minister to indicate whether in the meantime the contract for signalling will

    825
    be of such type as will allow for electrification, and would he bear in mind that in each of the last four years the investment allocation of British Railways has been reduced?
    Mr. Murray: We should want notice of that question.
    Mr. Ronald Atkins: In view of the fact that the Minister has so readily accepted electrification schemes for the Greater London area, even when such schemes are uneconomic, why can he not put on a little more speed when it comes to electrification in areas that need electrification much more?
    Mr. Murray: As I have said, my right hon. Friend hopes to give his decision on this matter shortly. I do not think at this stage the House will want me to go further than that.

    THE PRESS
    Q1. Mr. Winnickasked the Prime Minister if he will propose the establishment of a Royal Commission to inquire into the problems of the daily national newspapers.
    Mr. Arthur Davidsonasked the Prime Minister whether he will set up an inquiry to look into the state of the newspaper industry.
    The Prime Minister (Mr. Harold Wilson): I have nothing to add to my reply to similar Questions by the hon. Member for Banbury (Mr. Marten) and my hon. Friends the Members for Croydon, South (Mr. Winnick) and Billericay (Mr. Moonman) on 17th July.
    Mr. Winnick: Is the Prime Minister aware that there still remains a good deal of justified anxiety about the future of the national daily newspapers? Would he not agree that, whatever may be the problems of the newspapers, such problems should not be solved—as indeed they are not solved by most newspapers —by the re-publication of old, stale scandals, aimed at boosting circulation, which cause a great deal of injury to those who are now private citizens?
    The Prime Minister: What is published in the Press must be the responsibility of the Press itself to decide. If my hon.
    826
    Friend is referring to the case which I believe he has in mind, it has been the subject of a reference to the Press Council and a statement by it. It is not for the Government or the House to attempt to form a view on that matter. On the question of anxiety about the future of individual newspapers and the economics of the industry, my hon. Friend will recall that two or three years ago, when the Economist Intelligence Report was published, my right hon. Friend the then President of the Board of Trade and I said that if the newspapers wished to approach the Government on any of these matters, we should consider anything they had to say. They have not done so.
    Mr. Davidson: Would the Prime Minister consider setting up an inquiry into the limited question of the role of the Press Council, with a view to establishing whether that much-respected body should be given a little more authority to deal with the very small minority of newspapers which depart from the standards laid down by the Council?
    The Prime Minister: These matters have been debated in the House on a number of occasions. The Press Council was set up several years ago by the newspaper industry, following the Report of the Royal Commission, and it acts with the authority of the Press as a whole. I am not sure that, at any rate at this time, the House would be right to enter into any further consideration of the role of the Press Council. Therefore, I do not believe that it would be right to have an inquiry.
    Mr. Heath: Will the Prime Minister repeat his condemnation, in a speech in January, 1967, that unofficial unconstitutional strike action is blackmailing the newspaper industry?
    The Prime Minister: Yes, Sir. I said that in the speech to which the right hon. Gentleman referred. This has been a continuing problem. The right hon. Gentleman knows that my right hon. Friend the First Secretary of State and her Department recently have been giving a great deal of help in relation to productivity agreements in the newspaper industry, and there have been some significant agreements. In view of his great interest in this problem, he will no doubt have read the leading article in

    827
    the Daily Express which gave high praise to Mr. Feather on his solution of a difficult problem in the newspaper industry.

    FOOD AND DRUG ADMINISTRATION
    Mr. Edelmanasked the Prime Minister whether he will seek to establish an independent food and drug authority similar to the United States Food and Drug Administration.
    The Prime Minister: All aspects of the machinery of government are kept under regular review, but I do not think that a Food and Drug Administration on the United States model would be well suited to conditions in this country.
    Mr. Edelman: Is it not the case that there are at present four Ministries, including the Ministry of Technology, involved in dealing with the problem of food pollution, and that over 300 different authorities are concerned with the enforcement of regulations? Would it not be more rational to centralise authority?
    The Prime Minister: I think that the system which we have is the right one and that it would be wrong to set up an independent authority outside the control of this House. Inevitably, a number of Ministers are concerned—for example, the Minister of Agriculture, Fisheries and Food on the food side, and the Secretary of State for Social Services on the health side—and it is right that the Ministers concerned should be answerable to this House. Anything in the nature of the F.D.A. would be against our principles in this matter, and I have no reason to think that it would be more effective.
    Dr. Winstanley: Will the Prime Minister bear in mind that while it is necessary to exercise vigilance about the safety of food and drugs, any new machinery should be constructed to constitute more than just a sounding board for anti-fluoridists and other cranks who seem determined—[HoN. MEMBERS:"Oh!"I—to convince us—
    Mr. Rankin: On a point of order, Mr. Speaker. May I have your guidance on this matter? Is it within the rules of order of this House to designate perfectly respectable hon. Members who
    828
    hold certain views as being people who hold "cranky" views? Is that in order?
    Hon. Members: Yes.
    Mr. Speaker: Order. The hon. Member for Cheadle (Dr. Winstanley) did not make a reference to the hon. Member for Glasgow, Govan (Mr. Rankin)—
    Mr. Rankin: He was thinking of me.
    Mr. Speaker: Order. It is in order to use discourteous terms about groups of people either inside or outside this House. Dr. Winstanley.
    Dr. Winstanley: —and others who seem determined to convince us that the only way to stay healthy is to starve to death?
    The Prime Minister: I know that the hon. Gentleman has great medical authority, but so have the advisers of Her Majesty's Government in all these matters. I did not read the Question tabled by my hon. Friend the Member for Coventry, North (Mr. Edelman), as referring to fluoride, and I know from a learned treatise written recently that he had in mind more the problem of cyclamates, monosodium-I-glutamate and other exciting substances of that kind.
    Dr. Miller: Would not my right hon. Friend agree that there is another side to this, which is the danger of drugs to the public? Has his attention been drawn to an advertisement appearing in a national newspaper exhorting members of the public completely to disregard the findings of a very important committee in this country which tries to protect the public from dangerous drugs? Will he see to it that this kind of exhortation is not given countenance?
    The Prime Minister: I do not think that this advertisement is a matter for me. But I will see that my right hon. Friend looks into it if my hon. Friend the Member for Glasgow, Kelvingrove (Dr. Miller) will give me particulars.
    My hon. Friend will be aware that the Medicines Act, 1968, gives the Health and the Agriculture and Food Ministers a very extensive range of functions concerning the safety, efficacy and quality of drugs, comparable in scope to those of the F.D.A. which my hon. Friend the Member for Coventry, North was pressing upon me.

    OVERSEAS AID PROGRAMME
    Sir Ian Orr-Ewingasked the Prime Minister if he will place a copy of his public speech on Government performance at Polesden Lacey on 14th September 1969 in the Library.
    The Prime Minister: The speech was placed in the Library on 29th September.
    I agologise for the length of the rest of this Answer, but, as I informed the House on 30th October, I undertook to look fully into this matter.
    As my right hon. Friend the former Minister of Overseas Development told the House last Thursday, the facts which I gave were correct. I was referring to "the' aid programme ', as it is called". This has been maintained at £205 million since it was established at that figure in 1966, and announced in an Answer given by the then Minister of Overseas Development to a Question by my hon. Friend the Member for Portsmouth, West (Mr. Judd) on 12th December, 1966.
    In contrast to the estimates, there are variations in outturn from year to year, mainly related to the capacity of receiving countries to make their development plans effective. Extra items have been added to the basic programme from time to time so that the outturn each year has always exceeded £205 million. Both estimates and outturn in the latest available year are higher than in 1964–65 in terms of the official aid programme to which my speech clearly referred.
    These figures are of course in sterling at current prices, and as my right hon. Friend the Chancellor of the Duchy said in the House last Thursday, it has never been in question that the aid programme has declined as a percentage of G.N.P. But the House should also be aware that the latest O.E.C.D. statistics show that our official development assistance in 1968, as a percentage of G.N.P., was equal to that of Germany and higher than that of the United States. Of the large donors, only France had a higher percentage.
    The House should also be aware[HoN. MEMBERS "Too long."] I was much pressed on this last week by the right hon. Member for Kinross and West Perthshire (Sir Alec Douglas-Home). I undertook to make a statement at the
    830
    earliest opportunity, and it arises on this Question.
    Right hon. and hon. Members opposite may not want to know this, but the House should also be aware that in terms of the O.E.C.D. measure of generosity in aid—i.e. taking account of the proportion of grant and of the subsidy element in the interest on loans—Britain was in 1968 the first of all major donors, in that—
    Sir S. McAdden: On a point of order. In the very limited time which is available to hon. Members for questioning the Prime Minister, is it in order, Mr. Speaker, for that time to be utilised by the right hon. Gentleman to explain a speech that he made elsewhere, when he could easily do that by a personal statement at the end of Questions?
    Mr. Speaker: Order. The Prime Minister was asked the Question. He is answering the Question—[Interruption.]Order. Questions requiring lengthy answers as a rule ought to be answered after Questions.
    The Prime Minister: This is the second statistical smear that we have had from right hon. and hon. Gentleman opposite in two days. As with yesterday, these are better dealt with not in the give-and-take of questions, and I was about to finish my answer, Mr. Speaker, if you wish to hear it.
    What is known in O.E.C.D. as the "total concessional element" in our aid was 82 per cent., compared with 80 per cent. for France, 75 per cent. for the United States and 63 per cent. for Germany. These figures are given in Table 9 of the O.E.C.D. Press Release of 17th July. I would also draw attention to the footnote to that Table which shows that, even if the 1969 Supplementary Recommendation on Terms had applied in 1968, we would have been second only to the United States, among major donors.
    Our proposals for further aid expenditure will appear at the proper time; the White Paper on Public Expenditure will be published a few weeks from now.
    Sir Ian Orr-Ewing: Is the Prime Minister aware that, in that speech, he said of overseas aid:
    "It has not been cut, even in the most difficult days",

    831
    whereas Parliamentary Answers reveal that, in terms of dollars, in terms of percentage of the gross national product, and in the United Nations terms, it has been cut very substantially Would it not be shorter if he set an example and apologised to this House, and might not that example be followed by the Minister of Defence, who fiddled the numbers of Service men in Germany, and the habit might spread to the selection of candidates in cases like Islington? It is up to him to set an example.
    The Prime Minister: The apology for which the House is waiting is that from the right hon. Member for Altrincham and Sale (Mr. Barber). But in an intervention in the speech of the right hon. Member for Kinross and West Perthshire (Sir Alec Douglas-Home), I undertook at the first opportunity to give the result of my investigations into his allegations. I also said that the basic aid programme has not been cut. However, it is true—and I think that this is his point—that the outturn has varied from year to year. Taking the financial year 1968–69, it fell compared with the previous year. That was due to the fact that certain things which we were expecting that year did not occur—[Laughter.] —things outside the control of this country. Right hon. and hon. Gentlemen opposite can laugh again. The second replenishment of I.D.A. did not occur. That was not due to this Government. [Laughter.] Right hon. and hon. Gentlemen can laugh again at that. Special aid to Malaysia and Singapore was only begun during the year and therefore was less than had been expected. Also our official aid to India was changed by agreement with the Indian Government and put on a different basis, and it led to a fall in what they were able to absorb in that year. That is why the outturn last year was less than in the previous year. But it was still above the official aid programme which we announced.
    Sir Alec Douglas-Home: It is true that the Prime Minister said that he would look into this matter. I hope that he will not pursue the matter of statistical smear—[HON. MEMBERS: "Why?"] Because it is true, is it not, that the Pearson Commission has printed in its Report the fact that the percentage of gross national product applied to aid
    832
    in this country is falling, and has fallen. That was the point that I was on and that was valid.
    The Prime Minister: The right hon. Gentleman went further to throw doubt on the facts that I stated at Polesdon Lacey, and so did the right hon. Gentleman the Leader of the Opposition the day before. It is true that the right hon. Gentleman, having a sheet of figures in his hand, read from that particular line. But he did not read from the line relevant to my speech, which was that the total amount of official aid has not been cut. The right hon. Gentleman was trying to suggest that it had been cut.
    The percentage of G.N.P.—and I think that the right hon. Gentleman was wrong in his speech to the House about his own performance in this matter—has fallen, as I have said many times. But it is still very high compared with most other countries in the world.
    Mr. John Lee: While I think that most hon. Members on this side of the House appreciate and are proud of the work done by this country, surely the important point is not the remarks made by right hon. and hon. Members opposite, but that we should do all that we can to increase the aid that we can provide?
    The Prime Minister: Yes. My hon. Friend is quite right. This is the desire of Her Majesty's Government, and that was the basis of what I said at Polesdon Lacey. This year on the official economic aid programme, excluding military aid, we are now spending at a rate of about 6 per cent. or more above last year. I am glad about that. It is not as much as many of us in this House, on either side, would like. But when we have finished arguing about figures, we are talking of aid for people in great need of it. That is what we are all talking about. In the concluding words of my original Answer I said that we shall be able to announce the Government's new decision on this in the course of the next few weeks showing how far we feel we can go in present circumstances to reach our objective, which I understand is the objective of both sides, because the right hon. Gentleman was very forthcoming in answers to the Home Secretary's questions last week.
    Sir D. Renton: The Prime Minister said that aid has not been cut, even in the most difficult days. Will he indicate what effect devaluation had on the actual value of the aid received by overseas countries?
    The Prime Minister: I said, when I announced the aid programme in January 1968, that it would have some effect. But the right hon. and learned Gentleman must recognise that a large number of the countries where our aid is spent were not affected by devaluation. The aid is in sterling, and there is much less effect from devaluation. That is why it is wrong to measure it in dollar terms.
    Mr. Shinwell: Is not my right hon. Friend somewhat surprised at the anxiety of the Opposition about aid to underdeveloped and backward countries? Is he aware that, during a long time in this House, I have never found them so concerned? Indeed, on an occasion when I made a speech from the Opposition benches when a Tory Government were in office, they disregarded it entirely. They were not in the least interested.
    The Prime Minister: I do not go as far as my right hon. Friend, because on the benches opposite there are a number of right hon. and hon. Gentlemen who have gone a very long way—[An HON. MEMBER: "How many?"]— and have committed themselves, both in Government and in Opposition, to doing all that they can concerning aid.
    I was pleased last week that the right hon. Gentleman the Leader of the Opposition, although he raised this question in his speech only to try to prove some inconsistency in my figures, nevertheless, when asked by my right hon. Friend, committed himself to an increase in the aid programme, which I welcome and which I am sure the whole House will welcome. I took that as a rebuke to Tory canvassers who last week were trying to make capital out of what we are spending on aid.
    Mr. Heath: Is not the answer to the right hon. Member for Easington (Mr. Shinwell) and his colleagues on the back benches that, either in percentage of national income, which is what we discussed at U.N.C.T.A.D. in 1964, or in percentage of gross national product, the Conservative Government maintained a
    834
    higher percentage than the present Administration has been able to achieve?
    The Prime Minister: Yes, Sir—[Interruption.] But, as I said last week, the statement—[Interruption.]
    Mr. Speaker: Order. We must hear each other.
    The Prime Minister: —that aid had been cut was a false statement. That is the point with which I was concerned.
    Referring to the right hon. Gentleman's figure for 1964, quoted last week, that was also at a time of an £800 million trade deficit—[Interruption.] Oh yes, it was. The 1964 figure was at a time of an £800 million balance-of-payments deficit. I accept the Monday Club's correction.
    An Hon. Member: The right hon. Gentleman is still wrong.
    Mr. Speaker: Order. We cannot discuss this matter against shouting.
    The Prime Minister: I remind the right hon. Gentleman also that not only would he have had to cut the programme if he had taken over the deficit that he left to us, as he would, but it would be impossible for him to maintain any aid programme at all on his proposals for advanced military expenditure east of Suez.

FIRE SERVICE, LONDON
Mr. Speaker: Mr. John Page. To raise a point of order.
Mr. John Page: On a point of order. The House will be aware that there is a threat that the Fire Service in Greater London will be withdrawn tomorrow morning between the hours of nine and ten, and six and seven in the evening, leaving the whole area of Greater London potentially unprotected during the most dangerous day of the year.
I understand that an offer has been made to the members of the Fire Service and that a decision on whether this offer should be accepted will be taken at a meeting in Lambeth at 7.30 this evening. I think that it would be wrong both for the House and for the people of London if we did not know what the situation was and what the Home Secretary's contingency plans were before the

835
strike began, if it begins, at nine o'clock tomorrow morning.
My hon. Friend the Member for Liverpool, Garston (Mr. Fortescue) has agreed that if a settlement has not been reached he will withdraw his Motion for the Adjournment of the House. That would give the Home Secretary an opportunity to make a statement or for the matter to be discussed.
I thought it right to inform you, Mr. Speaker, of this, and also to give the Home Secretary an opportunity of considering this difficult matter, which is a great responsibility on his shoulders.
Mr. Speaker: This is not really a point or order for me to rule upon. We shall be on the Adjournment after the Division on the Amendment today. It will be in order then for any right hon. or hon. Member who catches my eye to raise on the Adjournment whatever matter he wishes for which a Minister is responsible, including the one that the hon. Gentleman has suggested. But it is a matter for hon. Members themselves.

QUESTIONS TO MINISTERS
Sir A. V. Harvey: Further to the point of order raised by my hon. Friend the Member for Southend, East (Sir S. McAdden),Mr.Speaker. Surely it is within your recollection that, when a Minister is to give an Answer during Question Time at such length as the Prime Minister has given today, he usually asks for permission to give it at the end of Question Time.
Because of the Prime Minister's long reply to Question No. Q4, he was able to answer only three Questions orally. Earlier this year, we suffered great inconvenience from the Prime Minister's long and ponderous Answers. It was not until he went to Bonn that the Foreign Secretary was able to get through his right hon. Friend's Answers rapidly.
Mr. Speaker: Order. The hon. Gentleman is an experienced enough Parliamentarian not to make debating points when raising a point of order.
Sir A. V. Harvey: I ask you, Mr. Speaker, to give the House and hon. Members protection of their right to have
836
lengthy Answers given at the end of Question Time.
Mr. Speaker: I did suggest today. during a long Answer to a Question that, if a reply from a Minister is to be long, it is better taken at the end of Question Time.

PARLIAMENTARY PAPERS (SUPPLY)
The Lord President of the Council and Leader of the House of Commons (Mr. Fred Peart): With your permission, Mr. Speaker, and that of the House, I would like to make a statement.
Yesterday, the right hon. Gentleman the Leader of the Opposition quite rightly pressed me about the supply of Parliamentary Papers and I promised to look into the matter and make a short statement.
As right hon. and hon. Members will know, the supply of Parliamentary Papers is at present almost back to normal. There has been a significant improvement since my right hon. Friend the Chief Secretary to the Treasury made a statement yesterday afternoon.
Most, if not all, right hon. and hon. Members will have received their HANSARD in the normal way this morning and the Order Paper has been printed in the usual form. Nevertheless, in view of the uncertainty, I am taking such steps as I can to minimise such inconvenience to the House should there be a recurrence of these difficulties.
It is not for me to comment on the dispute in Her Majesty's Stationery Office which has led to these problems. However, I can say that my colleagues fully appreciate the anxiety of the House and will continue to do all they can to ensure the smooth working of arrangements.
Mr. Maudling: We are grateful to the Leader of the House for having taken an interest in this matter because there was some concern after the Chief Secretary's answers yesterday. We are grateful for the improvement and also to the Vote Office for the tremendous amount of work it has done in the circumstances.
As the situation is still uncertain, however, may we have the right hon. Gentleman's assurance, as Leader of the House,

837
that we shall not be invited to undertake any business for which full documentation is not available?
Mr. Peart: I have said in my statement that all possible steps are being taken and for my part I will do all I can.
Mr. Boyd-Carpenter: When will the missing HANSARDS be issued? Is the right hon. Gentleman aware that we still have not got the HANSARD for 21st October, nor last Friday's, relating to the debate on the Address? Can he tell us what steps are being taken and when these copies of HANSARD will be available?
Mr. Peart: I am aware that the HANSARDS for 21st and 31st October are missing and I am hopeful that the additional backlog will be met. There are, of course, copies of these HANSARDS in the Library. I cannot tell the right hon. Gentleman precisely when they will be available, but I am pressing the matter.
Mr. Selwyn Lloyd rose—
Mr. J. H. Osborn rose—
Mr. Speaker: Mr. Selwyn Lloyd. Mr. Osborn. The right hon. and learned Gentleman the Member for Wirral (Mr. Selwyn Lloyd) does not have to ask a question.
Mr. Selwyn Lloyd: My right hon. Friend the Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) has asked the same question that I wished to put. Mr. Speaker.But may I ask the Leader of the House whether there is any special prejudice against him and myself, because one of the HANSARDS concerned is for a day on which we both made speeches?
Mr. Peart: I should not have thought that there would be, knowing the right hon. and learned Gentleman and myself.
Mr. J. H. Osborn: I welcome the steps taken so far, but is the Leader of the House aware that last night it was difficult to obtain an Order Book? In future, could steps be taken the night before to have Order Books available in the Vote Office, giving the next day's Questions? There was a Question down which I had intended for Oral Answer today, which was taken for Written Answer, and another vice versa, owing to that difficulty.
Mr. Peart: I appreciate the difficulties and I understand the problems. I hope that they do not occur again.
Mr. Michael Foot: Is my right hon. Friend aware that the Official Opposition are extremely eager that yesterday's HANSARD, containing the demolition of the entire Opposition Front Bench, should be suppressed for ever?

NEW MEMBERS
The following Members took and subscribed the Oath, or made the Affirmation required by Law:

John Golding, Esquire, for Newcastle-under-Lyme.

Christopher John Ferguson Ward, Esquire, for Swindon.

Francis Patrick McElhone, Esquire, for Glasgow, Gorbals.

Arthur Charles Latham, Esquire, for Paddington, North.

Michael Joseph O'Halloran, Esquire, for Islington, North.

ORDERS OF THE DAY
  QUEEN'S SPEECH
    DEBATE ON THE ADDRESS

      SIXTH DAY
      Order read for resuming adjourned debate on Question [28th October]:
      That an humble Address be presented to Her Majesty as follows:
      Most Gracious Sovereign,
      We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland, in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.
      Question again proposed.

      HOUSING
      Mr. Speaker: I want to announce that I have selected for today's debate the Amendment standing in the names of the right hon. Gentleman the Leader of the Opposition and some of his right hon. Friends—the Amendment on housing.
      3.51 p.m.
      Mr. Peter Walker: I beg to move, at the end of the Question, to add:
      "but humbly regret that the Gracious Speech contains no proposals to assist the homeless, to facilitate home ownership, or to reverse the present serious decline in house building."
      At this time, when we are looking at ever-declining housing figures, it is important to try to recognise the main objectives of housing policy and to recognise it in terms of the needs of the coming decades, when this country will be faced with two long-term problems and one immediate problem. The two long-term problems are, first, a substantial increase in the population and, secondly, the fact that one-third of our housing stock is in need either of replacement or of major repair. The urgent and immediate problem is that of the homeless and those who are in real housing distress.
      It is to this end that the housing policies of Governments should be shaped. It is to this end that I want to address a few
      840
      preliminary words as to the way in which we consider that these policies should develop. At present, nearly one-third of our population is living in council houses. I believe that in the coming decades we shall enter an era in which a lower proportion of our population will wish to be tenants of a public authority. Therefore, one of the immediate facts to recognise is that if Governments are to be successful in achieving a high-wage and prosperous economy for the majority of our people they will have to remember that the desire of most people will be for a home of their own.
      This has been clearly shown in market research—undertaken not by political parties, but by independent bodies. It has been shown that, given a preference, 85 per cent. of our people would rather be home owners than tenants. It is important that Government policies should be directed towards the recognition of this fact. Given as situation in which the average wage earner was within sight of being able to afford a home of his own, my hon. Friends and I would prefer to assist him to buy a home of his own rather than that he should become a tenant of a public authority. In this respect, we may see a basic difference between the two major parties.
      Several Hon. Members: Rubbish!
      Mr. Walker: I am delighted to hear of the conversion of some hon. Members opposite.
      Secondly, we should see that subsidies and help in the public housing sector are concentrated on those in real need. At present, there is a large area of real housing need while, at the same time, a great deal of subsidy is going to people who are not in need. I cannot see why it should be a pleasure to any major political party—whatever its basic philosophy—to know that at present many who are in desperate housing need are receiving no help while many others who are in no need at all are receiving substantial assistance. It is necessary to see that the subsidies and help are given to those in real need.
      At Question Time recently the Minister of Housing taunted me with a quotation from the Sun. I should say, in fairness to the Minister, that it was a reasonable quotation, because the Sun did not report the whole hand-out, which I have here if

      841
      it is needed. My theme is that the future will not be one in which councils are endeavouring to show that they are building an increasing number of council houses as compared with the year before, but one in which they will seek to show that they are concentrating upon the social problems involved.
      At present, not nearly enough help in housing is going to those who are suffering from disabilities, towards solving under-occupancy by providing smaller accommodation for elderly people whose families have grown up, and really to tackle the problems of the worst cases of the homeless.
      It is in these spheres, and the sphere of a major programme of renewal and repair, that future housing policy should lie. What is absolutely certain is the need for a high priority to be given to housing. The interesting thing about the political scene at present is the sharp contrast to the priority that the Labour Party gave to housing at the time of the last General Election. It is easily expressed by the difference between the Labour Party's election manifesto and the Queen's Speech, which we are now debating.
      In the Labour Party's manifesto the position was quite clear. It said:
      Our first priority is houses."
      That was the priority which Labour gave above all other social problems. Housing was their major priority. In the Queen's Speech there is not one mention of housing from one end to the other, except a reference to the possibility of some form of legislation on council house rents.
      The contrast in priorities is shown still further by the attitude of the Prime Minister. In the election campaign there was no subject to which the Prime Minister gave more prominence than the subject of housing. He went from constituency to constituency making firm, unqualified and clear pledges on the topic of housing. In television programme after programme he plugged three promises—that the Socialists would bring down the price of land, that they would bring down the interest rates for home owners, and that they would build 500,000 houses a year.
      What is the position of the Prime Minister today? In the whole of the
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      Gracious Speech there is not one mention of housing. Therefore, the Prime Minister has broken every record; he has certainly broken every promise. His promises are clear. I shall read just one major promise that he made about which there can be no dispute. He went to Bradford and there said:
      "We shall go on year by year reaching by 1970 no less than 500,000 new dwellings."
      He added:
      "This is not a lightly given promise. It is a pledge. We shall achieve the 500,000 target and we shall not allow any events, any circumstances, however adverse to deflect us from our aim."
      That was a firm promise by the Prime Minister.
      Nor did the right hon. Gentleman speedily retract that promise. At the time of devaluation he told the House that the priority programmes—and he mentioned housing among them would not be affected by devaluation. A little later he stated—when pressed on the question whether the 500,000 target still existed, and after the Chancellor had announced that the 500,000 target had been dropped —that the target would be missed to the extent of 16,000 houses that had been taken out of the programme.
      The last recorded statement of the Prime Minister was that by 1970 484,000 houses would be built. What is the position? This year the Government expect to build 365,000 houses and next year 360,000.
      Mr, Roy Roebuck: In view of the fact that the hon. Gentleman deplores this cut-back in progress, can he do anything to persuade his Conservative friends on the Harrow Borough Council to have a housing programme?
      Mr. Walker: The hon. Gentleman need have no fear. I shall come to our own borough councils in due course—[An HON. MEMBER : "And others."] And others too, my word!
      Therefore, when we look at the Government's housing policy we can condemn it on a number of specific counts; first, on their failure to build 500,000. Indeed, if the Prime Minister's original categorical promises to the electors were fulfilled, by the end of 1970 this Government would have built 336,000 more houses than, in fact, will be built.

      843
      Secondly, we condemn the Government's housing policy because of the failure of the Government to fulfil their promises to reduce interest rates and the manner in which interest rates have lifted to a record height. The simple fact is that the mortgage repayments on the average-priced new house is today £2 17s. a week more than when Labour came to power. Yet this was the party that came to power on a categorical promise to cut interest rates for house purchase.
      Thirdly, we condemn the Government because of the manner in which local authority mortgages, a vital form of finance for our wage earners to buy older premises, have been slashed from £175 million when Labour came to power to £55 million this year. It is announced today in a number of newspapers, including The Guardian and the evening papers, that this afternoon the Minister will announce that next year the figure will be lifted to £100 million. If that is so, it will still be £75 million lower than when the Labour Government came to power.
      The next point on which the Government can be condemned is the manner in which the council house rents have had to be lifted as a result of interest charges. In the City of Birmingham alone the increased interest charges on its housing account has resulted in an average increase of 13s. 9d. a week in the rent of council houses in the area.
      Next is the failure of the Labour Government to keep down the price of houses. Many of us remember that in our constituencies in the 1964 and 1966 Elections, the price of houses was one of the major campaigns that the Labour Party fought. The public were led to believe that if the ramp in land prices came to an end housing prices would come down. What is the position? The position is that when Labour came to power the average price of a new house was £3,470. Today, it has risen to £4,782, a rise of nearly 40 per cent. in the five years of the Labour Government.
      When one looks at the reasons for the rise, one discovers a series of Government actions, including interest charges, the import surcharge and, perhaps worst of all, the selective employment tax. When one considers that the Government pledged to give a number one priority to
      844
      housing, and then decided to treat the building industry as a service industry, imposing upon it the maximum selective employment tax, it shows that their actions were very different from their policies.
      Then there is the failure of the Government to sustain the momentum of the voluntary housing movement which has now steeply declined. The number of houses approved by the housing corporations was halved in 1968 asopposed to 1967, and the 1969 figure is expected to be equally depressing.
      Next, there is the failure of the Government to see that the improvement grants brought in by the recent Housing Act were not eroded by rising costs and rising interest rates. A significant fact is that today somebody wishing to do the equivalent of £1,000-worth of improvements, as opposed to 1964, would find that the cost of the balance of financing that grant would be something like £1 a month more than in 1964.
      Then there is the failure of the Government to fulfil their promise on land prices and the abject failure of the Land Commission which, instead of lowering land prices, has increased them and, instead of providing land, has provided misery for a lot of elderly people with limited means.
      Finally, there is the failure of the Government to redefine the problem of the homeless and the manner in which the present housing programme, with high mortgages and high rents, is likely to increase the numbers of people suffering from the problems of being homeless. This is a serious situation. At present, a person on the average industrial wage cannot afford to buy a home of his own. This is a dramatic change from when the Labour Government came into power. Then, the mortgage repayment on the average-priced new house was £18 6s. 4d. a month. The average weekly industrial wage was £18 3s. This meant that the average industrial wage earner could afford to buy the average-priced new house. Today, the mortgage repayment has risen to £31 7s. 2d. a month and the weekly industrial wage has risen to only £23.
      This means that an enormous category of people who could have solved their housing problem by buying a home of their own cannot do so. They cannot

      845
      find rented accommodation, so they put their names down on the council house list. I warn the Government that the deterioration in the number of houses for sale at the present time will be reflected in the coming months by the number of people putting their names on council house lists. Those people will have little chance with many local authorities. If they are newly-weds they will have no chance at all, because they will not have a sufficient points allocation.
      Those who were moved by the film "Cathy Come Home", as no doubt the whole nation was, will recall how the family started—[Laughter.] If I may say so, no party has created more Cathys than the party opposite—
      Mr. Eric S. Heffer: rose—
      Mr. Speaker: Order. The hon. Member is not giving way. Mr. Walker.
      Mr. Walker rose—,
      Mr. Heffer rose—
      Mr. Speaker: Order. Mere insistence does not make an hon. Gentleman give way. Mr. Walker.
      Mr. Walker: As I was saying, we shall have an increasing number of people going to the council house lists, and in this situation we have council house building going down. Let us examine the degree to which council house building is declining at the present time.
      Mr. Roebuck: Come to Harrow.
      Mr. Walker: I shall. We see the decrease in the amount of council house building, not as fast as the privately-owned sector but at a fairly rapid rate, in spite of repeated warnings to the Minister of Housing.
      I recall a series of debates during the past year. In the first debate we warned the Government that with their present policies of high interest rates, the cutting down of local authority mortgages and the financial difficulties of local government, a large decline would take place. The Minister in March said that he thought this year's figures would be similar to last year's. At the beginning of May he repeated that. At the end of May he said that there had been some difficulties in the early part of the year due to the weather. There had been
      846
      some bad weather in February, but he pointed out that the number of approvals was encouraging.
      At the end of May the Minister of Housing saw no frightening trend in the housing figures. As to completed houses, the number in 1969 was substantially down on the number in 1968. We have a situation where last year the number of housing starts declined by 53,000 and this year it will probably decline by the same amount again.
      In the private sector the decline is much greater than it is in the public sector. In the first nine months of this year the number of houses completed in the public sector fell from 137,000 to 130,000. The number in the private sector fell from 162,000 to 136,000, a rather greater fall. The number of new council houses started in the nine-month period fell from 150,000 to 139,000 in the public sector and by about double that number in the private sector.
      The fall in the owner-occupied sector has been twice as great as that in the council house sector. The Government have no defence for this fall. As far as I know, nobody on the Government side has suggested that the builders who are going bankrupt are doing so to sabotage Labour's housing programme. The Government can only put up the defence that high interest rates have this undesirable effect. Therefore, the Government have no defence at all for the enormous drop in the owner-occupied sector.
      They do have a defence as to the public sector. This defence is based upon accusing Conservative councils of sabotaging the programme. Bearing in mind these facts, I want the House to recall that the actual drop in the public sector is about 11 per cent. The Minister started a campaign against Tory councils at the Labour Party conference. He made a speech condemning the number of Tory councils where the housing figures had fallen. That speech did not receive much publicity.
      At Question Time a week or so ago all of the new Ministers in the sphere of housing were instructed to plug home how Tory councils were cutting back their programmes. Nobody was more keen than the new Parliamentary Secretary, who rushed to the Dispatch Box and even stated that the increase in the

      847
      cost of housing was due to the fact that Tory councils were not placing such big orders these days. I can understand that he was under a brief to do so. Therefore, the Government campaign went on.
      Then last week, the week of the by-elections, the Minister wrote to 20 Tory-controlled local authorities bringing to their attention the manner in which the housing programme was declining in their areas. Two newspapers—the Observer and the Sun, neither of which can be accused of being particularly partisan to the Tory cause—decided, I suppose with some relish, to look into the facts of these 20 local authorities that the Minister had chosen.
      Perhaps I can best sum up their reaction by quoting these comments written by Judy Hillman, the planning correspondent of the Observer:
      "Since his admonishment was sent only to Tory-controlled councils in the final run up to last Thursday's mini-election, it was natural that local politicians should react with charges of political hypocrisy. What is more surprising is the number of officials who describe the action in similar terms. Political tripe' is the term of one housing manager … Any Minister of Housing would be worried. However, Mr. Greenwood's advisers do not seem to have been wise in picking on these councils."
      How right Judy Hillman was. She contacted each of the councils and in her article she set out the very good case they have against the Minister's letter.
      Indeed, the Minister's letter was in almost every case factually wrong. He started to mix up wrong years. For example, I quote the case of Kingston upon Hull. I quote the reply from the chairman of the housing committee:
      "That you should use your ministerial position in our democratic country for such a purpose is lamentable; that for political ends you should seek to increase the anxiety and despair of the homeless and the badly housed is inexcusable."
      The chairman went on to show that, whereas the Minister in his letter had suggested that there had been a decline over recent years from 2,520 to 1,707, in fact the figures show that there has been an increase from 1,442 to 1,707. Therefore, the very facts and statistics of the Minister were completely wrong. As for Harrow, the Minister suggested that there was virtually no programme, but he has now received a reply from the Mayor of
      848
      Harrow pointing out the very real and substantial programme that is in hand.
      Mr. Roebuck: Is the hon. Gentleman aware that Harrow built only 20 council houses last year, that it has no programme for next year or the year after that, and that the houses which are to be built are the spill-over because those concerned were so sluggard about the existing housing programme which was put into effect only because the council was badgered into it by my right hon. Friend the Member for Bermondsey (Mr. Mellish), who was Joint Parliamentary Secretary to the Ministry of Housing and Local Government at the time.
      Mr. Walker: At this very moment there are 458 houses under construction in Harrow. Whichever one of the few remaining Labour members on Harrow Council it is that the hon. Gentleman relies on, he is badly informed.
      The Minister—I think absolutely wrongly—has used the Ministry of Housing and Local Government to do a straight party political campaign on this issue. As he wants to do it on this basis, I take him on on equal ground.
      I shall now consider the performance of Socialist boroughs and see how they fare compared with Tory boroughs. As the Minister himself chose some of the London boroughs, I have taken the latest available figures which have been published. These are the figures published by the Minister of Housing, borough by borough, for the year ended June, 1969. I shall compare the figures for the year ended June, 1969, for Socialist boroughs with the figures for the previous year to see what momentum has taken place in Socialist boroughs.
      I take, first, London boroughs. Tower
      Hamlets: 1968, 952; 1969, 669.
      Barking: 1968, 720; 1969, 641.
      Newham: 1968, 1,393; 1969, 496.
      In case I am accused of being selective, as there are only four Socialist-controlled London boroughs, let us look at the last one—Southwark: 1968, 3,545; 1969, 430.
      The decline over Tory boroughs, taken throughout the country, is 11 per cent. In London, in Socialist boroughs, the decline is 66 per cent.
      I now give some figures for the North-East. Gateshead: 1,317 in 1968, down to 688.

      849
      Jarrow—a great Socialist memory—400 in 1968, down to 87.
      Wallsend: 298 in 1968, down to 18.
      Turning to the North-West, St. Helens: 560 in 1968, down to 381.
      Wigan: 471 in 1968, down to 275.
      In the Midlands, Stoke-on-Trent: 499 in 1968, down to 179.
      Worksop: 181, down to 6.
      In case the Home Secretary, who made a great deal of this topic in his speech, is wondering about what is happening in Wales, let me tell him. The Rhondda: 556 in 1968, down to 130.
      Merthyr Tydvil: 160 in 1968, down to 54.
      Llanelli: 170 in 1968, down to nil.
      As the Leader of the House is to reply to the debate, I must in all fairness to him admit that there is certainly one Socialist borough where there has been no decline. I speak of the Borough of Workington, where in the year ended June, 1968, the number of houses started was nil and in the year ended June, 1969, the number of houses started was nil.
      I have been very selective. Therefore, let me give a summary of the total. In England and Wales there are 32 Socialist-controlled boroughs and county boroughs. In the 12 months ended June, 1968, they started 16,197 council houses. In the 12 months ended June, 1969, they started only 9,184. Therefore, the total picture, Tory versus Socialist, is that over all Tory and independent controlled boroughs the drop has been 8 per cent.; over the Socialist boroughs the drop has been 42 per cent. All that I can say to the Minister is that if he sends letters to Tory boroughs he had better start sending telegrams to Socialist boroughs.
      Therefore, the Government's defence that this is a Tory plot to sabotage their programme is not true. The truth is that local authorities, faced with difficulties concerning interest charges—
      Mr. Frank Allaun: The hon. Gentleman knows that, whatever the Government have or have not done, they have given 4 per cent. loans for building council houses. The hon. Gentleman said in the Daily Express on the 6th of last month that there are too
      850
      many council houses in Britain. What is he complaining of?
      Mr. Walker: If the hon. Gentleman had listened to the early part of my speech he would know that I said that future council house building should be concentrated on areas where there is desperate need. There are far too many people in council houses who should be given the right to own them if they wish to do so. That was the point which I was making.
      If the hon. Gentleman feels that interest charges have no effect on council building, I would reply that, while it is true that the rate of 4 per cent. is subsidised, in arrears, after the building is completed, the enormous increased cost of land and building and the fact that local authorities must finance it during the building stage is having a considerable effect.
      I turn to what is needed for the future. I wish to suggest the housing policies which we shall pursue. First, concerning the homeless, disabled and elderly, we shall concentrate the subsidies on those people who need help. [HoN. MEMBERS: "How?"] In exactly the same way as some more enlightened housing authorities have proper rent rebate schemes, we will ensure that there are proper rebate schemes and that there are not people in council houses receiving subsidies who do not need help. We shall ensure that the help is concentrated where it is needed.
      Secondly, we shall see that the housing association movement is properly encouraged because, as the Seebohm Report clearly shows, this movement has a considerable role to play in providing houses in difficult and problem areas.
      Thirdly, we shall set up a proper housing advisory service throughout the country. There are far too many people paying high rents in furnished accommodation who, if properly advised, could be buying a house of their own or participating in a cost-rent scheme. We shall redefine the homeless and make a survey of the worst of the housing problems and thereafter announce month by month the manner in which they are being tackled and solved.
      Turning to owner-occupation, the main thing is to run the economy so that we do not perpetually suffer from high

      851
      interest rates. During 13 years of Conservative Government, not once did interest charges go above 61, per cent. Secondly, we shall try to run the economy so that local authority mortgages are readily available, as they were during 13 years of Conservative Government, Thirdly, we shall ensure that the mortgage option scheme is used in such a way that it is of much more positive help. Only tonight the Minister is to move an Order on the mortgage option scheme which, according to him, could not have been moved a little less than 12 months ago. Even after the improvements are made, the mortgage repayments on the average-priced new house, taking full advantage of the mortgage option scheme, will still be El 10s. a week more than it was in 1964.
      We shall ensure that selective employment tax, when abolished, is replaced by a tax under which proper consideration is given to the building and housing industry. We shall abolish the absurdity of the Land Commission and all that goes with it.
      We shall encourage the housing association movement in the modernisation of housing and act much more positively than the present Minister has done to activate the Housing Act, 1968. We shall change that Act and keep it up to date by making payments to cope with inflation. Inflation and high interest charges have already completely eroded the improvement grants which can be made under the Housing Act.
      Mr. Raphael Tuck: How does the hon. Gentleman propose to reduce interest rates when world interest rates are so high?
      Mr. Walker: No Government gave a greater lead towards interest rates going up than this Government. With our immense influence in the sterling area, if correct action is taken under a sensible Government interest rates will come down.
      On the question of modernisation and rehabilitation, the present Minister introduced an Act and left it. It has not been utilised to its fullest extent.
      Mr. Roebuck: Why not?
      Mr. Walker: Because of the lack of activity by the Minister ; and the failure
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      to communicate with those who could take advantage of it is deplored by people who are actively concerned with solving this problem.
      We shall combine policies to help those in difficulty and to assist owner-occupation on a wider scale. We move our censure Amendment today because Labour has let down the owner-occupiers. It has let down those repaying mortgages. It has let down people who expected 500,000 houses a year to be built. It has let down those who expected lower interest charges. On all those specific issues the Government have failed the nation, and that is why we condemn them.
      4.28 p.m.
      The Minister of Housing and Local Government (Mr. Anthony Greenwood): I think that I would command generai agreement if I began by expressing the grief which we all felt at the untimely death of Sir Milner Holland, a few days ago because his Report on Housing in Greater London was one of the most valuable and most carefully considered documents on housing ever placed before us. It is a little sad that his death should have come so soon after the death of our former colleague Ben Parkin, whose advice was consistently ignored by hon. Members opposite until the Milner Holland Committee was appointed. Those two men are entitled to the gratitude of us all and, still more, to the gratitude of the homeless and oppressed in London.
      One of the consequences of that work and the way in which we followed it up is that we now have more and better information about housing conditions. It is, perhaps, a little ironical that we are now being attacked because we have brought to light facts which in some quarters were inadequately appreciated in the past. Let us put those facts into perspective.
      The hon. Member for Worcester (Mr. Peter Walker) complained of the fact that this year there is only one reference in the Queen's Speech to housing. Of course, the answer is that the last three years have been the most active period from a legislative point of view that the Ministry has ever had, as well as being a period of record housebuilding figures.
      We have restructured our planning machinery, created priority housing areas, which have been encouraged to build

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      to capacity, we have made more generous provision for subsidies to local authorities, ended injustice to owner-occupiers in slum clearance areas, established the option mortgage scheme, provided a better system of grants for improvements, given leaseholders the right to buy freeholds, afforded much greater protection to private tenants and prevented an escalation of council house rents.
      It is, therefore, surprising that in their Amendment hon. Gentlemen opposite should attack us on such a limited front. There is no mention of rents, no mention of slums, hardly a mention of improvement policy, no mention of tied cottages, no mention of tenants in furnished lettings and no mention of new towns. There is no mention of all those things, but all of them are relevant if we are to take a balanced view of the changes that have taken place.
      Sir Frank Pearson: Would not the right hon. Gentleman agree that all those factors are totally irrelevant if there are no houses?
      Mr. Greenwood: If the condition of tenants in tied cottages or furnished lettings is irrelevant to the hon. Gentleman, I am happy to say that it is not irrelevant to Her Majesty's Ministers.
      I will deal, first, with housebuilding. Certainly, it will be down this year. The hon. Member for Worcester was right in his estimate of 365,000 completions and we expect the figure to be approximately the same for the following year. Some of the fall, particularly in the private sector, is undoubtedly due, directly or indirectly, to world conditions and to the various measures which the Government have had to take to strengthen the economy of the nation.
      If a determined effort must be made to restrict the growth in private spending, less money will be available for personal long-term spending ; for example, on house purchase. That is inevitably a matter for regret for any housing Minister, but, in common with my right hon. Friends, I accept my share of responsibility without apology.
      Without a sound economy there can be no large housebuilding programme. A bankrupt economy would not shorten the waiting lists for houses, but lengthen them. It is, therefore, no good hon. Members cheering the success of the
      854
      Government's economic policy, as they did yesterday, and at the same time disclaiming responsibility for the disadvantages of such a policy.
      The hon. Member for Worcester appears to believe that high interest rates are a phenomenon peculiar to this country. I had hoped that my right hon. Friend the Chancellor of the Exchequer had disabused hon. Gentlemen opposite of that view yesterday. Perhaps I had better refer hon. Gentlemen opposite to the current issue of Time, which contains an interesting feature on the American housing programme.
      I will give three short quotations from the article. The first is:
      "This year starts of houses and apartments dropped from an annual rate of 1,900,000 in January to 1,300,000 in August".
      The second is:
      "The rate of housing starts may dip below I million by year's end".
      The third is:
      Money is so scarce that average private mortgage rates have risen from 6·4 per cent. two years ago to 8½ per cent. now. Many borrowers must pay 84 per cent. or even 9 per cent."
      I do not believe that anybody can dispute the effects of hig interest rates on housebuilding however much we seek to insulate option mortgagors or local authorities against them.
      Even if one concedes that high interest rates hold back both public and private sector housing does it mean that we must cut local authority building as severely as some local authorities seem to be doing? The hon. Member for Worcester criticised the letters that I sent not last week, but the week before, to 20 local authorities the programmes of which appeared to be slipping seriously. I am sure that the hon. Gentleman was under an honest misunderstanding when he referred to figures for starts or houses under construction. The purpose of my letter was to get local authorities to look to their future programmes. I am quite prepared to give the figures for the various authorities to which I wrote on that occasion.
      It may be helpful if I point to the interesting fact that—I will deal with approvals although I will not go through the long table—that, for example, Sunderland had 901 approvals last year while to the end of September this year

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      it has had eight. Kingston upon Hull, to which the hon. Member for Worcester referred, had 3,486 approvals last year and has had 934 approvals this year. West Bromwich had 763 last year and has had 158 this year. Oldham had 1,424 last year and has had none this year. So one could go on through the rest of the 20 authorities. [An HON. MEMBER : "What about Southwark? "] Southwark was not one of the authorities.
      One cannot distinguish clearly between the political control of local authorities in this context. There are a number of local authorities which have extremely good records, while others are disappointing. Although we wrote to 20 local authorities to start with, it was only the culmination of pressure that had been brought to bear on them for a long time. Officials of the Ministry are in touch with all the local authorities to ensure that their approvals for this year and next are up to the maximum. The important thing about this is that the 20 authorities to which I wrote are among the most important authorities in the country. For example, in 1966 they had 16·3 per cent. of the total approvals. At the end of September of this year the figure for approvals for them was 9· per cent., a serious drop. In 1966, they had 26,600 approvals. By the end of September the figure was only 5,500.
      I do not believe that any Minister could have stood idly by and seen the crumbling away of the housing programme in this way. I want hon. Gentlemen opposite to apply their minds to this question : why are some of these authorities falling behind when Liverpool, Manchester, and Lambeth are doing better with approvals than they did last year and when Birmingham is still doing extremely well? Some Conservative authorities are doing well while others are doing badly. I believe that the difference is accounted for by the varying degrees of importance that the majority groups attach to the housing programme.
      I read with interest and admiration a statement made by the Chairman of the Birmingham Housing Committee, Alderman Beaumont Dark, last Thursday:
      "It is economic madness to build council houses at the moment with the high interest rates. But we are spending £30 million a year at the moment in new houses, knowing it is economic madness, but it makes social sense"
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      This is the attitude of mind we want the various local authorities to adopt.
      We do not want them to adopt the attitude of the right hon. Member for Wolverhampton, South-West (Mr. Powell) who, I regret, is no longer in his place. That right hon. Gentleman said, when addressing the Federation of Registered Housebuilders:
      "My proposition is that there ought not to be a housing policy".
      He went on to say :
      "There is only one 'right' rent for a house or flat; that is the best that the owner can command".
      There then came this sad note:
      "All municipal houses should, therefore, be vested in a public corporation charged with the duties to maximise the return from them and manage this public estate ' on the best commercial principles and gradually to dispose of them—dare I say denationalise them—to private property companies and private owner occupiers."
      I hope that when we have the winding-up speech from the Opposition Front Bench that point of view will be repudiated.
      Mr. Richard Crawshaw: Would my right hon. Friend agree that, despite the advances made by the Government, some local authorities bear a heavy and undue proportion of the cost of rehousing in relation to other authorities? If it is true that we are seeing the end of an overall housing shortage, is it not time that we adopted a policy in which all local authorities help, even if they have not got to build houses themselves? The issue is political. Places which have a housing problem, such as Liverpool, know that if they build houses, despite Government subsidies, they will have to increase rates. This problem should be taken out of the political arena. Is it not possible to do it on an overall basis throughout the country?
      Mr. Greenwood: That is certainly an attractive proposition, and there are many advantages in it, but I would want to consider it rather more carefully. I shall come later to what is perhaps the same point.
      One of the troubles is that the Conservative authorities are tending to take the advice of the hon. Member for Worcester. He was kind enough to say that I had quoted him accurately in the House and I now have a full copy of

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      the interesting contribution he made to the Urban Research Bureau Housing Conference in Manchester on 7th June. He said:
      "I hope the Conservative councils will take great care to resist the temptation to go on building council houses for all sorts of seemingly good purposes... new Conservative Housing chairmen have a great tendency to prove to the Socialists that they can build even more council houses than their predecessors... I do not mind their finding the good social reasons for doing so provided that at the other end they find good economic reasons for releasing many other council houses for owner-occupation."
      We are apparently to take that as being the official view of the Conservative Party. What are the overall housing figures? It is important to look at them. If we examine the period from the beginning of November, 1964, to the end of October, 1969, and compare them with the same period in the last five years of Conservative Government, we find that during the Conservative period of office housing starts totalled 1,716,000. In the same period of office the Labour Government's figure had gone up to 1,983,000. The number of completions during the period of Conservative Government was 1.550,000 and for the same period of the Labour Government it was 1,961,000.
      Sir Douglas Glover: On a point of order. Is it in order for the overlord of the right hon. Gentleman to sleep during a speech?
      Mr. Andrew Faulds: Doze off yourself and stop interrupting.
      Mr. Greenwood: I hope that the hon. Member is not finding my figures too difficult to understand. To help him with his arithmetic it means that in five years there have been built under a Labour Government no less than 411,000 houses more than in the same period of Conservative Government. When the Conservative Party went out of office in 1964 there were 438,000 houses under construction ; there are now 459,000.
      What conclusions do we draw? First of all, that there has been a substantial advance in both public and private sector —an increase of 411,000 more houses under Labour.
      Mr. James Allason: Is the right hon. Gentleman being entirely fair? Does not the Prime Minister usually give it in percentage of in-
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      crease? Would he tell us the percentage increase over the last five years of Tory rule and the percentage increase during the first five years of Labour rule?
      Mr. Greenwood: I can hardly hope to come up to the standard of fairness of the hon. Member for Worcester. The hon. Member for Hemel Hempstead (Mr. Allason) will have plenty of time before he speaks to make the calculations. The substantial point is that in the same period 411,000 more houses were built under the Labour Government.
      The second conclusion we draw is that the figures this year, although disappointing, will be higher than in any of the last five years of Conservative government, except for the General Election year of 1964. The third conclusion is that the number of houses under construction is higher than at any time under the Conservative Party. The fourth conclusion is that there is every reason to believe that the two millionth house will be completed this month. To sum it up, a slump under Labour would have seemed like a boom under the Tories.
      I am not satisfied with the progress and that is why we have offered help to the local authorities which seem to be falling down on their programmes. If the local authorities do fall down, we shall have to review our present machinery. That is why we are engaged on a major review of housing finance and subsidies—the most searching that has ever been attempted. That is why we must study carefully the Labour Party's suggestion for a house building corporation and that is why we look forward to the report of the Select Corn-mince presided over by my hon. Friend the Member for Wolverhampton, North-East (Mrs. Renée Short). More than anything else, I am dissatisfied with the rate of slum clearance, and I shall shortly be asking local authorities to submit to me their programmes for accelerating slum clearance. This is of the greatest importance.
      I turn now to the homeless. I will not join in this cynical and rather artificial wrangle about definition. The point is that there are far too many people still living in appalling conditions. I have known that for years, and so have hon. Gentlemen opposite. We all know it if we visit Balsall Heath or part of

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      Salford or whole areas of London and the North. The greatest contribution any of us can make is to build more houses. The addition of two million new houses and the clearance of over 250,000 slums in four years has had a tremendous impact upon the problem.
      There is still a long way to go before we on this side will be satisfied. That is why we have stepped up slum clearance and are stepping it up still further; why we have given local authorities effective powers to deal with multiple occupation; why we have provided more generous grants for the conversion of old houses; why we have given generous help to housing associations; and why in the 1969 Housing Act we have launched an important campaign which can change the face of our industrial areas.
      We have another responsibility, and it is to protect those who could become homeless. That is what we did in the Rent Act. On the whole, that Act has worked remarkably well. I know that there are misgivings about it, and for that reason I have recently appointed a Committee of inquiry under Mr. Hugh Francis to examine the workings of the Act and particularly to take account of the problem of furnished lettings. Whatever reservations any of us may have, the fact remains that harassment and eviction has declined and in many areas wholly disappeared. That is something which right hon. and hon. Gentlemen opposite did not even try to achieve during their period in office. We have also phased increases in private rents and controlled council house rents. I shall shortly he laying before the House further legislation in this connection. We have had the broad agreement of the local authority associations, and I am only sorry that the Greater London Council is declining to co-operate. We have encouraged rent rebate schemes, so that three-quarters of council house tenants now live in the areas of local authorities which operate rent rebate schemes.
      What about another group of potentially homeless people? What about the tied cottages, in which right hon. and hon. Gentlemen opposite never seem to have shown any very great and penetrating interest? It is just another of the problems that they neglected. The Rent
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      Act almost eliminated evictions from tied cottages. But a system under which a man who loses his job can have his wife and family turned out into the street is a system which is basically wrong. Our agricultural workers are a group of potentially homeless people about whom the party opposite has been strangely silent in the past. But it is a group that my right hon. Friend the Minister of Agriculture, Fisheries and Food and I were determined to help, in spite of the practical difficulties—and those difficulties are very great. But the House will know that the Agriculture Bill gives far greater protection to the tenants of tied cottages than ever before.
      Before I leave the subject of homelessness, I hope that I have said enough to convince the House that the Government do not need lessons in humanity and justice from the Conservative Party.
      The third of the topics which they have selected is the problem of home ownership. The hon. Member for Worcester, as though he was on the road to Damascus, suddenly saw the light and announced that people want to own homes of their own. I suspect that every hon. Member has said that at one time or another. The figures show that we have helped them to do that much more effectively than right hon. and hon. Gentlemen opposite. By the end of 1968, there were no fewer than 8,847,000 houses owned by the people who live in them. That is 48·5 per cent. of the population, and higher than it has ever been. Those are not figures which would have been achieved by a Government who did not believe in home ownership.
      I think that right hon. and hon. Gentlemen opposite perhaps have forgotten the Leasehold Reform Act and the improvements which we made in it in the Housing Act, 1969. The leasehold system in some parts of Britain was an abominable injustice. The Tories did nothing to get rid of it. To take another example, they failed to take effective action to end jerry-building. Now, with Government backing for the National House-builders Registration Council, 95 per cent. of houses built for private owners this year will be built with the House-builders Registration Council guarantee.
      Next, there is the option mortgage scheme. The hon. Gentleman is free with criticisms of the scheme. It is a

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      great pity that his right hon. and hon. Friends did not start it originally and leave it to us to improve it. They had plenty of time in which to do it. It was only after we had announced it as Labour Party policy that they began to take an interest in it and become converted to it themselves. We put it on the Statute Book, and 325,000 families have benefited from the option mortgage scheme.
      Tonight I shall be moving the Order to which the hon. Gentleman referred ahead of the date which the Opposition tried to say we ought to do it. We shall be doing it tonight, and we shall have an opportunity of debating it then.
      Lastly, I come to the subject of local authority home loans. No one regretted more than the other Housing Ministers and I the need to cut back on this valuable contribution to the housing programme. I am glad that we were able a few weeks ago to raise the figure for this year by another £25 million. I am glad today to be able to inform the House that the figure for next year will be £100 million. That should enable the local authorities to plan ahead.
      It follows from a review of the likely pattern of housing expenditure in the year 1970–71 that we shall, for example, have to reckon with some reduction in the expenditure on house building, mainly because of the delays which have occurred in the placing of contracts by local authorities. This enables us to vary the disposition of public expenditure and, at the same time, to help the secondhand housing market by increasing the money available for financing the purchase of older houses. This, in turn, will help generate demand for new houses, which depends on there being a satisfactory market for houses of all kinds.
      In all aspects of housing, we have a record of which we are proud. It has been the best five years for housing in our people's history, in spite of all the economic difficulties. Millions of people are benefiting from what has been done. It may he that future generations will not recall the houses built in these five eventful and difficult years, but certainly they will recall that these were the years in which Britain and the British people raised themselves by their own efforts and escaped from the humiliation of being the poor men of Europe.
      4.56 p.m.
      Mr. Arthur Jones (Northants, South): I am amazed that the right hon. Gentleman should be so pathetically self-congratulatory over the performance of the Government in housing during the past five years. He has tried to deal with a whole series of peripheral factors which have come to his mind, and they form no part of a central housing programme and policy.
      I am disappointed that he did not refer in greater detail to the need for emphasis on the improvement and conversion of older houses. This formed a significant part of the 1969 Housing Act, which was highly commendable in its conception. But there are no grounds which lead us to believe that the proposals under this Act will be any more successful than those attempted by his Government and by the previous Conservative Administration.
      The White Paper "Old Houses into New Homes" showed that in 1967 there were 4½ million houses each of which needed something like £125 spending on it to bring them up to a reasonably good standard, and that figure excludes those houses which are in the slum designated areas. Despite that, the number of standard or discretionary grants fluctuated, but basically they fell over the period 1960–67. The total standard and discretionary grant in 1960 was about 130,000. In 1967, it was down to 113,000. That is not an absolute fall in numbers only, but it must be considered in the light of something like 4½ million houses being in need of some form of rehabilitation.
      It is a problem of great dimensions, in both physical and social terms. The old levels of grant were £155 for a standard grant and £400 for a discretionary grant. Under the 1969 Act, those were increased to a maximum of £200 for a standard grant and £1,000 for a discretionary grant. It will be seen that the financial advantages of the new scheme are very substantial. Although I have predicted that there will not be any substantial success in improvements and conversions, since we have not had enough experience, it is difficult to see whether we are likely to have any emphasis upon rehabilitation to provide good accommodation at reasonable cost and preserve the environment from the

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      monstrosities of the redevelopment programme. We need more than pious words and a bit of extra cash as window dressing. We need a hard commercial logic of the money involved in the financing of housing in conversion and improvements, and there are two sectors affected by these grants—the persons receiving them and the agency which is to administer them.
      The two groups concerned in improvements are the owner-occupiers and the landlord. I think that, for the former, the scheme of improvements and conversions is most attractive. It needs the encouragement by local authorities and to some extent their involvement to push owner-occupiers to improve their properties, but for the landlords, both large and small, there are logical shortcomings in the Government's scheme which I think mitigate against its success.
      What we see under this arrangement is a 50 per cent. grant to the landlord who, by means of this legislation, is encouraged to find the other 50 per cent. to put into his own properties. The landlords are going to be concerned essentially about whether their 50 per cent. is being wisely spent. They are not going to be affected immediately by any substantial rent increases. They are not being allowed to apply for substantial rent increases. Rent increases are to be phased over a period up to 1975, and when people bring their judgment to bear on whether it is wise for them to invest their private capital in the conversion and improvement of their property, there are not going to be able to make a very happy comparison by investing that money elsewhere in the market.
      So we have this contradiction and it can only be by allowing substantial increases in rent that we are going to persuade the private landlord to involve himself substantially in terms of his own money in the expenditure on improvements and conversions. This, I am sure, is the fundamental defect of the present and the previous arrangements. It turns on the degree to which a landlord can look for a reasonable and fair return on his investment and I cannot think that, with the Government's ideological attitude on the whole question of rents, we are going to be able to persuade landlords to improve their properties. It will not be an attractive investment for them.
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      Changes from controlled to regulated tenancies can only be the result of improvements by way of conversions, and it is still an unprofitable exercise in terms of a prudent investor. I do not think that grants alone will achieve the scale of improvements which the Government seek and which we all look for if we are to rescue the 4½ million houses which are part of our available housing stock and which can be improved with far less capital investment than new properties. Apart from that, it enables us to retain the advantages, in social terms, that lie in existing communities.
      Who is to carry out the policy of improvement? The purpose must be to develop an alternative to public provision. The Government are suggesting that local authorities should acquire, by agreement or compulsion, large areas of tenanted properties. I think the case has been made strongly by my hon. Friend the Member for Worcester (Mr. Peter Walker) that the public sector is getting beyond the limit of public resources to meet. Now the Minister himself has made this point today. The fact is that there are inadequate public funds to meet an expanded housing programme, and therefore the only way to expand the programme is to get private money into it. We can only do that in the rented sector by making rented property more attractive in reasonable terms to investors, existing landlords and people who would invest in rented property.
      We must involve the institutional funds in housing. To a tremendous extent these funds are now put into industrial and commercial properties at very low rates of return—6 or 7 per cent. in many cases. We should be inviting, encouraging and persuading the substantial investment funds—the life assurance, pension funds and so on—to come into the provision of housing. This is really the only way in which we shall ensure fresh capital funds, not only to improve our present stock but to extend the numbers of owner-occupied and rented properties.
      This is a fundamental question to which the Government have not addressed themselves. We have had no positive proposals from the Minister on ways in which the housing programme is to be expanded or on the important effects of improvements and conversions made to a far greater proportion of our housing
      Mr. Julius Silverman: How can the hon. Gentleman say that, when the 1969 Act, introduced by the present Government, has only just come into operation?
      Mr. Jones: I am dealing in general terms with the Act. I said earlier that it is too early to see its full effect. I am trying to demonstrate my analysis, which I think shows that we shall have a similar failure in this aspect of the Act—improvement and conversion—as we have had in earlier legislation. I am sure that the hon. Gentleman must agree with me that the legislation. I am sure that the hon. Gentleman must agree with me that the legislation has been disappointing hitherto. I am looking for ways and means by which this important aspect of housing policy can be expanded and I am sure that the only way is to have a much more realistic rent policy.
      I am sure that we need to expand our attitude on rent and to have a realistic policy which has regard to current rental values. I am not saying that this should be introduced overnight. We should have a phased policy of rent revision which would bring about much greater reality. By all means help those who are in need. At the moment our help is given quite regardless of a person's circumstances, and, as my hon. Friend has emphasised, it it is a fundamental of Conservative policy that we should see that aid is given for housing directly to those in need. Thus, we should have a twin attack. We must get a much more realistic rent policy and at the same time direct help to those in need.
      Mr. W. Howie: I am following the hon. Gentleman with great interest but not totally. When he refers to more realistic rents, does he mean higher rents? If he means higher rents, he should say so.
      Mr. Jones: I am sorry if I have been obtuse in my explanation. I should have thought that a more realistic rent policy means that we bring up rents commensurate with present-day building costs and less tied to building costs of the past, which is mostly the case now. By doing that and having a policy of directing help to those in need, I am sure that we should find a substantial solution to some of the problems with which we are faced.
      Mr. Silverman: The hon. Gentleman has made the remarkable statement that this form of assistance should be given
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      only to those in need. Is he suggesting that standard and discretionary grants should be given on a means test to those who need the money, whether owner-occupiers or landlords? If not, what does he mean by confining this aid to those in need?
      Mr. Jones: I do not think that the hon. Gentleman has followed me as I hoped he would. I am talking about assistance with rents, not assistance with schemes of housing and conversion, where a capital sum is applied. I am saying that, having enjoyed a grant of 50 per cent. and having put in his 50 per cent., the owner should then be able to enjoy a much more realistic rent for his investment. That is the point that I am trying to make.
      Mr. Silverman rose—
      Mr. Jones: I will not give way again, if the hon. Gentleman will excuse me.
      In an article in the Evening Standard on 19th October by Harry Brack, we were told that these schemes of clearance and development are changing the character of many boroughs in London and elsewhere. I am in favour of conversion and improvement schemes rather than putting the bulldozers through these sites and the creation of quite different forms of social housing than we have had in the past.
      The article concluded:
      "After Islington's Packington lesson, the Ministry of Housing and Local Government might stop councils destroying good housing. But the basic flaw in the whole system of the Government's housing subsidies is still with us. Redevelopment schemes rank for a higher grant than those of repair and improvement."
      This is another potential nail in the coffin of improvement. Not only is it commercially unattractive. It is not likely to be encouraged by many local authorities, who prefer their own grandiose schemes of demolition and rebuilding rather than, as hitherto, of conversion and improvement.
      We can achieve a successful housing policy only by more realistic rents. Having regard to present-day rental values, historical values should give way to economic considerations, with a realistic application of rents to those in need. It is only upon such a foundation that the necessary resources can be found. These must come from the private sector, from

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      institutional, life and pension funds. It is in this context, with the knowledge of the Government's blind spots on housing, that I see no hope for the future of their housing policy, either in new building or in conversion and improvement.
      5.12 p.m.
      Mr. Arthur Latham: It is neither presumption nor impetuosity which leads so newly elected a Member to enter this debate. There could be no more appropriate introduction for me than in a debate on housing. I say this for three reasons. One is that I have the honour and privilege to succeed Mr. Ben Parkin, whose championship of the problems of tenants is well known to the House and who was the Member who uncovered Rachmanism, which was a big factor in the election of a different Government in 1964—so that the Act which made Rachmanism possible could be repealed.
      Second, my own background in local government has been very much concerned with housing, and I have been proud of a record there of our learning to treat tenants as people and not merely as occupiers of property. The third reason that I feel it right to enter this debate is that housing remains the number one problem in North Paddington. It is a constituency which contains as complete a range of tenanted properties as one could expect to find.
      Apart from those three reasons, one thing which would have provoked me in any case to enter this debate, if given the opportunity, was the rather disturbing apparent rejoicing by the Opposition that this year's housing figures are somewhat lower than those of the year before. I would simply ask the House and the Opposition whether it is better to aim at a target of 300,000 houses and sometimes get near it or to aim at 500,000 houses and build 400,000. It is the number of houses built which matters to the homeless, not notional targets.
      The Minister has already said, to put it in a slightly different way, that in the last five years four houses have been built for every three which were built in the last five years of the previous Administration. I suggest that it would have been of more benefit to the homeless if the people now controlling most of the
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      town halls and city halls had put as much energy into putting up houses as they have put into putting up rents.
      They seem to show this preoccupation, which was evident in the speech of the hon. Member for Northants, South (Mr. Arthur Jones), with the idea that higher rents are the answer to the housing problem. Higher rents, while not a solution, do represent a way of overcoming the housing problem, because they are a way of concealing need. If rents rise higher and higher, people will not enter their names on waiting lists and one will then appear to have resolved the problem when one has merely concealed the need.
      I fear that this is a method now being practised in many town halls. The G.L.C. is particularly guilty. There are flats in North Paddington for which the proposed rent is £9 5s. a week although the new tenant may, with the wonderful rebate scheme offered by the G.L.C., have his rent reduced to £7 5s. or £7 15s. So this process of raising rents is a way of concealing the housing problem rather than solving it, and it is already being practised. Rents of that description take a disproportionate part of a wage earner's income.
      On behalf of the people who recently voted me into the House, I should like to congratulate my right hon. Friend on stopping the G.L.C. rent increases. The people of North Paddington know and approve of this action. However, I want to warn the Minister that the G.L.C. is now finding other ways, having been frustrated in its plan of taking the money from the pockets of G.L.C. tenants. It is renegotiating heating agreements and passing on responsibility for repairs and decoration which previously did not exist. Having been frustrated in its attempt to increase rents, the council is seeking more devious ways of extorting the tenants of its properties in North Paddington and London generally.
      Another way of overcoming the housing problem, of course, is to evict tenants. I hope that it may be possible, although the Amendment has not been called, for the Minister to comment on Section 5, I believe, of the 1968 Act. This is enabling the G.L.C. to seek to evict tenants not because they have been bad tenants but because it has shied away from the proper course of action

      869
      for recovering rent arrears and, in most cowardly fashion, is sheltering behind that Section and simply seeking possession of property, since it is required to state no reasons for doing so.
      I am told that the reason for this section was that it was assumed that councils and other public bodies would behave reasonably and responsibly. I submit that the G.L.C. in this matter is not behaving in a reasonable and responsible way, and I should like to see the Minister take powers to intervene if an authority abuses what is, after all, a position of trust and privilege. I have spent 18 years in local government and I am as jealous as anyone of the right of local government to resist intervention by the national Government. Frankly, however, the point can be reached when powers are abused or when a local authority is so in default of its social obligations that it is right and proper for the central Government to act, and act urgently.
      I submit that the same principle arises —this is a debate about housing and one cannot build houses unless one has the land on which to build them—with the all-too-ready willingness of most of these local authorities to dispose of publicly-owned land. It seems that they are following a policy which emanates from what I know to be the other side of Smith Square. I would like to see my side of Smith Square concerned to stop the sale of public land for private commercial purposes.
      There is such a site in South Paddington. It is land sadly and sorely needed to relieve the long waiting list, but it is now to go for commercial exploitation rather than for the public good. It is in these matters that there is a growing need for the Minister to intervene.
      It is not reasonable to ask the homeless to wait until 1971, because not until then will there be a chance for the people of London to tell these councils what they think of their housing policies. I welcome the Minister's statement that the machinery is to be reviewed, and I hope that he will go much further.
      There are many other points about housing that I would like to make, but I will leave most of them for the future. I will content myself on this occasion with merely adding a criticism and expressing
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      my concern about some of the plans that are in being for modernising property.
      My right hon. Friend was kind enough to come to North Paddington in the last fortnight. I do not know whether he had a chance to look at the Queen's Park Estate, which contains houses built in the 1880s. Some of these houses are better than others, but Westminster City Council, which has a dismally slow, unambitious and unimaginative approach to the problem, is proposing to modernise 80 houses a year for 10 years. That is to be the rate of progress. At the end of that period, in 1979, those houses will, it is considered, be good for 30 years. This means that it is envisaged that this estate of houses built in the 1880s will provide proper housing standards for the year 2009.
      The council concerned should think again. In so far as the Ministry may have been concerned in this matter, it should also think again because one of the proposals for these houses, which are to represent a model for the year 2009, is that a kitchen in each house shall be taken away and converted into a bathroom and that a dining room in each shall be taken away and converted into a kitchen. There the process will end. This seems to be taking one step forward and one back at the same time. An hon. Gentleman opposite spoke earlier of the need to take a bulldozer to convert houses. There are many cases where a bulldozer is needed if we are to have a forward-looking policy which takes full account of housing standards for the future.
      It is in connection with the process of modernising houses that one must question whether local authorities are the right agents or whether the Minister should consider establishing a new public body to deal with these activities, for more urgent action is required and we need to enforce more strenuous standards.
      It is sometimes suggested that there is an air of unreality about the Palace of Westminster. I am sure that other newly-elected hon. Members will have been surprised at what has occurred in the last day or two and may, to some degree at any rate, have had a feeling of disbelief at having been elected to this place. The behaviour of hon. Gentlemen opposite has contributed very much to that feeling

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      of disbelief and unreality, for yesterday they were attacking the Government for solving the balance of payments problem while today they are attacking the Government for building more houses than they built in their comparable five years in office.
      5.25 p.m.
      Sir Douglas Glover: It gives me considerable pleasure to speak following the hon. Member for Paddington, North (Mr. Latham). I do so with added pleasure because he now probably holds the record for having made his maiden speech after the shortest possible time as a Member. I think that it was Sir Alan Herbert who held the record for many years, but I do not believe that even Sir Alan managed to make his maiden speech within one-and-a-half hours of being introduced to the House. I therefore doubly congratulate the hon. Gentleman.
      I am sure that the House will listen with great interest on many future occasions to what the hon. Gentleman has to say, particularly on housing matters, for he obviously speaks with much authority on the subject. If his speech may be regarded as having been noncontroversial, I shudder to think what he will be like when he really lets himself go.
      I do not criticise the hon. Gentleman for being controversial. I made my maiden speech in the old tradition of being non-controversial. I realise now, too late, that the time of making one's maiden speech is the time to be controversial, because it is the only occasion when one can speak in the House in the knowledge that one will not be interrupted. I therefore congratulate the hon. Gentleman on his skill and wisdom in these matters. We look forward with great interest to hearing him—as I rather suspect we shall on frequent occasions —on housing and other matters.
      I had considerable sympathy with the hon. Gentleman's remarks about what I would call house rehabilitation, and I regret that the Minister is not in his place because I have something nice to tell him. I suggest that since the war we have made a great mistake in believing that we should go in for the process of knocking down a lot of property because
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      much of it could, if properly rehabilitated, have been of use for many years to come.
      I would like the right hon. Gentleman to visit a scheme which was opened by Lord Rhodes, an old colleague of many of us, at Skelmersdale in Lancashire. In that scheme the authority has rehabilitated some privately-owned property as well as council houses, all in the same street. Having bought some property in the street that was owner-occupied, the council has completed the scheme by a process of leapfrogging; in other words, houses in various parts of the street were rehabilitated so that people could move into fully repaired and modernised dwellings. The scheme had just been completed when I saw it.
      The street has been turned into a playground precinct and trees have been planted. As there is no traffic, hon. Members will easily appreciate what this old Lancashire street now looks like. It reminds one of a patio. These little old houses now contain bathrooms, air central heating throughout, and as well as their looking like new pins inside, the outside walls have been pebbledashed and the whole scheme gives the impression of a completely new area.
      If I lost my relatives and wanted to live in a small house of my own, I would not mind in the least living in one of these houses because they are ideal for this sort of purpose. I understand that the authority is proposing to modernise houses in other roads which run parallel to this street as the opportunity occurs. I do not mind who is responsible for this sort of work, as long as people get decent homes.
      I also agreed with the hon. Gentleman's remarks about the time it takes to carry out modernisation schemes. It is necessary, if old houses are to be rehabilitated in Skelmersdale or elsewhere, that greater urgency is given to such schemes than is given to anything else, because in another 10 years many houses of this kind will not be worth rehabilitating. I believe, therefore, that the loan scale for rehabilitation should be more attractive than for new building.
      A lot of good property can be saved and made really attractive if action is taken now, but it cannot be left for another 10 or 15 years, with the work

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      being done in phases. A crash programme is needed. I would almost forgive a housing minister who said to the House,"We have modernised 200,000 houses this year but our new building programme has gone down to 250,000." That would be doing something that needs to be done urgently if it is to be done at all. There is a great future for it.
      It is not always realised that over our countryside there are enormous—and I use the word "enormous" deliberately —numbers of what have been old and derelict farm houses and country cottages that have been bought and modernised by fairly wealthy people. These are some of the most attractive houses we now have. But if those properties had been in the towns they would have been bulldozed as being too old for rehabilitation, or as being useless because they did not have a damp course, or something like that. If the basic fabric of a building is sound, it is amazing what can be done, if the will is there, with the skill of modern architects and builders. If the desire is there, there are very few pieces of property that could not be saved at far less cost than building new houses al present prices.
      With present interest charges—and I shall not seek to apportion blame, though my hon. Friend the Member for Worcester (Mr. Peter Walker) is quite right—the chance of home ownership is slipping from the grasp of a great percentage of the population. The interest rates are so high that people cannot afford to buy out of income, though they might be able to afford one of these rehabilitated houses. All parties should look again at this problem.
      I have been speaking generally, but I now want to become more selective and specialised. Not surprisingly, the right hon. Gentleman did not refer to cost-rent and co-ownership houses. Here I must declare an interest, although there is no financial gain involved but a lot of time, toil and trouble. I am the chairman of a housing society which owns, on behalf of the nation, about 250 housing units. I must be reasonably competent, because only this week I have been invited to become chairman of another housing society with a similar number of housing units. If that comes about, I shall be controlling about the largest
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      of these organisations. If the House and the country are wise, they will realise that there is a definite and urgent need for the build-up of the cost-rent system of housing.
      I go a long way with what has been said by my right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell) about the housing situation. We probably went wrong in 1919, but whether we did or did not the fact is that we face a situation in 1969 and it is not much use talking about what happened in 1919.
      Over the last 20 years about one million fewer units of accommodation to rent have been available. That means that there must be a greater pressure on the remainder; that there is pressure to put up the rents of the remainder; and that Government legislation to control rents may be necessary because we are dealing with an ever-smaller ball and with more and more people wanting to hold it. These are facts. I do not suppose that in the climate of politics we would get any large body of commercial enterprise to build a great deal of accommodation to let. The history of the last 50 years shows that if they had done so the Government of the day, of whatever colour, would at some stage have hit them over the head. They see that it would not be a profitable proposition, so none will undertake it. That is a fact of life that must be faced when considering this problem.
      On the other hand a healthy society needs quite a large volume of accommodation to let. Municipal rented property does not fill the bill of what I am trying to achieve. I want a pool of mobile property. Council house property is what I call static. No one can get a council house unless they have lived in the area concerned for five or 10 years or more. They are assessed on a points system before they can qualify for accommodation.
      In a healthy society, in which there is mobility of labour, with people changing their jobs and being offered promotion from one factory to another, we must have a pool of reasonably decent accommodation for people affected by what Australians call this "walkabout". I reckon that we need to have about 10 per cent. of all our property in that category. I have shown the House that

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      we shall not get it from commercial development. Council housing does not fill the bill. The only remaining solution is for the State to undertake that the cost-rent housing system and non-profit making organisation should receive encouragement from all parties and be built up until its number of units of accommodation built every year comprises about 10 per cent. of the total. This could contribute a great deal to our active life, mobility of labour, and all the things that we talk about when we discuss economic affairs.
      This cost-rent housing system started in 1964. The original pilot idea came from my own friend Lord Brooke, as he now is. As I have said, the Minister today did not mention this subject in his speech. The Government record with reference to the cost-rent system in the last two or three years has been absolutely deplorable. We volunteers in this system were encouraged to form societies to build all over the country. Although I was not able to obtain figures because the person concerned was not in his office, I believe that there are about 700 housing societies in the country and only about 54 of them have a scheme on the stocks. All the rest are dormant.
      Hundreds of those societies have not even built an old person's bungalow because they cannot get sanction from the Housing Corporation. The Government in 1964 said that in the first five years of its administration it would provide £300 million, but I think the total amount found up to now is £75 million. Hardly one new scheme has been sanctioned. Nearly every housing association is hag-ridden with frustration and anger, much of it misplaced, against the Housing Corporation but the real nigger in the woodpile is the Government. This scheme started with an enormous amount of good will but it is gradually grinding to a halt because it is not receiving the encouragement it should have from the Government.
      I do not expect that whoever replies to the debate tonight will give a categorical assurance for the future, but I am concerned that, as so often when we battle with a problem in this House, we merely discuss it and make no further progress. We can make progress only when people can get their teeth into some
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      sort of figure. I should like the cost-rent and voluntary housing system to be dealing with about 10 per cent. of the housing problem of the country. In round figures that would mean 20,000 or 30,000 houses a year. I should like the Government of the day to set a target for 1975—only five years' time—by which the cost-rent housing system would be producing 25,000 or 30.000 units of accommodation every year.
      This month figures for the next five years' expenditure will be given to the House so that we can mull over them. I should like those figures to include an item to cover that number of cost-rent housing units a year. If we could have more cost-rent units provided the tendency would be for other rents to come down because the general pool of rented accommodation would be increased.
      We talk about cost-rent housing and co-ownership housing. I am a great believer in what is known as self-build. In many parts of the country people get together and co-operate to build their own houses, and that is called self-build. I would not mind if the so-called co-owners in those organisations were actually co-owners. They are called co-owners because this Government brought in the option mortgage scheme. So that there can be a belief, however far-fetched, that those concerned were actually buying their accommodation, a co-owner-ship block of flats has an option mortgage while the block of cost-rent built flats which is next to it does not get the option mortgage.
      If one builds an estate of houses, but for the option mortgage they would be cost-rented and those who lived in them would pay the rent after amortisation, maintenance and so on, without any profit accruing, but the Government of the day do not think they can give the option mortgage to an organisation called a cost-rent organisation. Yet if one turns the same accommodation into a co-owner-ship society, that society can get the option mortgage and so the rents come down. This is nonsense; it is "fiddling the books". The proper answer would be to give the option mortgage to cost-rent housing associations and to do away with so-called co-ownership.
      The Government have not the faintest idea of how a co-owner would be paid after he left accommodation he had had

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      for two years. The co-ownership society has no money; who, therefore, will pay a so-called co-owner in a unit in Liverpool who changes his job and goes to work in Dagenham? If he has been in the house for two years he is entitled to two-fortieths of the value of the house, but the Government did not think this out. No one, even after two years, is prepared to give housing societies any guidance about what to do with a so-called co-owner who vacates his property and demands two-fortieths of the value which he considers has accrued through his having the accommodation and paying what really is hire purchase on the property. I hope that my right hon. Friends will note this because this is one of the things which should be put right when we are returned to power. It is a great tragedy that it is not right. We are getting very worried about what will be the management level of the so-called co-ownership units as against the cost-rent units.
      Mr. Arthur Jones: Would not the new entrant to the co-ownership scheme have to find the amount which the outgoing co-owner would get?
      Sir D. Glover: I do not think so, because he is not a house purchaser. This is the weakness of the scheme. I do not want to go any further into this point because the officials in the Department know the problems only too well.
      I return to my original theme. Inevitably there are difficulties with any new scheme, whether it be in housing or anything else. I am convinced that in our society the scheme to which I have referred would have a great future. In other debates we talk about the mobility of the population and the ability of people to take jobs. Yet there is less and less rented accommodation. We find that our accommodation is very popular with teachers. Many teachers, particularly in their early days in teaching, go to a town for perhaps two years. They do not want the trouble of buying a house because they expect to move. They do not want to live as paying guests in other people's houses. They want one-bedroom flats. We are the ideal people to provide such accommodation for them. They cannot be put on a housing waiting list. Perhaps they are with us for only two years.
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      I am sure that we need a big pool of such accommodation. In a perfect free enterprise society it would be found by commercial development. But as the result of action by all political parties in this country there is very little enthusiasm for that. Therefore, the only alternative is cost-rent accommodation. I hope that my right hon. Friends are seized of the necessity to encourage the creation of such accommodation. I only wish that in the short interim period which they have the Government will get down to tackling this problem. It is not a party matter but a matter of producing houses for people to live in.
      Mr. Deputy Speaker (Mr. Harry Gourlay): Many hon. Members have said that they wish to speak. It will, therefore, assist the Chair if those who are fortunate enough to be called keep their speeches reasonably brief.
      5.54 p.m.
      Mr. Arthur Blenkinsop: I am sure that we are all interested in the development of building associations of a great variety of forms but do not wish to see them made the excuse for limiting local authority housing programmes. Most of us believe that there is still an urgent demand for council house building at as high a level as we have been able to maintain in the past few years. Although it is no longer universal, it is nevertheless true that the need is still acute in many parts of the country.
      Therefore, I welcome very much what my hon. Friend the Member for Paddington, North (Mr. Latham) said in his excellent maiden speech. I welcome it all the more because I knew very well the campaigns of his predecessor and the great effect which he had in making changes and saving many people from misery. As one of many colleagues whc took part in campaigns against the 1957 Act and some of its predecessors, I am amazed at the courage, if that is the right word, of hon. Members opposite in daring to have housing debates in the House at all. [An HON. MEMBER: "Effrontery.] "Effrontery" is a much better word because of their complete blindness to their responsibility for much that we suffer from today.
      There is great anxiety in the country about the apparent uncertainty in several

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      areas concerning the demands and needs. It is therefore necessary that the Government should be willing to undertake further surveys of housing needs and to go forward, as my right hon. Friend the Minister intimated they might do, with Government agencies for direct building if it were found that the local authorities were unable or unwilling to undertake a task which is obviously theirs. Some of the recent discussion about the position in Liverpool and elsewhere causes anxiety because many of us know the size of the problem which remains and we are determined to see that the need is met by whatever agency is necessary to meet it.
      I am delighted that in recent years we have been looking at the housing problem very much more in the round, realising that it is a problem not only of new house building but of slum clearance and rehabilitation, in respect of which the Government have an extremely good record. No one seeing the immense transformations in very many towns could decry the Government's effort in meeting the need. We welcome that. We also welcome the immense developments in house improvement that can be carried out under the recent Act. This is a very important element in the programme.
      However, we also recognise that rents are a vital issue. I was astonished by one hon. Member opposite who apparently thought that this had no relevance to housing. All those who live in rented houses know how relevant it is. We are all deeply concerned about the undoubted effect of high interest rates on rents and house building prices. I hope very much that the improved economic situation will soon be reflected in a reduction of the appallingly high interest rates.
      I should like to refer to the need for some gradual development—and I appreciate that it cannot be more than gradual—in the full registration of rents so that we may know what rents are being charged. We are concerned that many people are not using the Rent Act as fully as possible. Many tenants are not applying to the rent officer. One way in which we could help in this process would be by insisting on the gradual registration of rents generally so that a rent officer would be able to discover
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      without difficulty what rents were being charged in his area. I should like cases to be brought to the rent officers' attention by official bodies as well as by tenants, who may still be under some forms of pressure.
      Sir Frank Pearson: Would the hon. Gentleman agree that if there were sufficient houses the question of rent control would not arise? This is the basis of the problem.
      Mr. Blenkinsop: Hon. Members opposite have not moved very far. The hon. Member for Ormskirk (Sir D. Glover) thought that there was not much point in going back to the 1916 or 1918 situation. I suspect that the hon. Member for Clitheroe (Sir Frank Pearson) would wish us to go back that far. Our concern is to ensure that more houses are built. We welcome the fact that over the last few years there has been a record amount of house building. We want to see the figures rise again.
      To ensure that the Rent Act is more fully used by tenants, it would be valuable to have at town halls a system of independent registration of rents so that rent officers and others could know where action was needed and where unconscionably high rents were being charged.
      It is necessary to consider whether rent allowances in one form or another should not now be considered for private rented property as well as for council houses. The problem is acute for those who are required to pay higher rents. Because of the recent Act, in the near future there will be others who will be expected to pay higher rents. If this is so, there should be an opportunity to ensure that the facility of obtaining a rent allowance is available to them as well as to council house tenants.
      I have intervened only to insist on what I am sure is a very widely-held view; namely, that the need for maintaining a high level of public building through local authorities is as urgent as it ever was. There may be areas where the need is less, but the need in most conurbations is still serious. I therefore hope that my right hon. Friend will not only continue to urge local authorities, of whatever political complexion, to maintain their housing programmes but will also seriously investigate the possibility of

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      establishing a regional or national building agency, such as has been successful in Scotland, to maintain programmes at full level.
      6.2 p.m.
      Sir Frank Pearson: I want at the outset to declare a personal interest, in that I am closely connected with a firm dealing with the construction industry.
      Housing is perhaps one of the most important subjects facing the mass of the people. It is probably one of the subjects that has more electoral effect than any other aspect of political discussion. Therefore, it was not surprising that at the last General Election the Labour Party made the firm and solemn promise to set a target for the completion of 500,000 houses a year. That was a very attractive vista for the hundreds of thousands of families who today live in sub-standard conditions.
      Today, there has been an exchange of statistics setting out to prove certain things. I am not sure that the statistics which have been bandied about strike at the heart of the problem. Statistics must, by their very nature, nearly always refer to the past. It is rare to find statistics reflecting the present situation.
      In the construction industry the present situation is much more serious than that reflected in any of the statistics quoted today. We are suffering from a degree of loss of confidence in construction for home ownership that we have not seen since before the last war. This loss of confidence has come in its acutest form only in very recent times—I would say in the last two months. A mixture of high interest rates and a doubt about the general trend of the economy has undermined to an exceptional degree the feeling of buoyancy that existed up to six months ago and which led to the demand for home ownership, which, in turn, led to the construction of so many houses. It is the problem of the loss of confidence, not only by purchasers but also by the construction industry itself, which the House must consider.
      About six months ago a Government spokesman—I believe that it was the present Foreign Secretary; I have forgotten in what capacity he was then addressing the House—said that by 1970 we should, over the country as a whole,
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      have as many houses as the country needed. He may well have been right. In the way he said it I have no doubt that his statement was absolutely right, but to the general public and to those involved in the construction industry his statement was misleading to an exceptional degree, for it is just not so.
      I speak with experience of the North-West. Any hon. Member who represents a North-West constituency knows full well that there are 20 years of construction work ahead of us before we begin to solve the problem of the slums of the old industrial towns of Lancashire and the North-West.
      Mr. Heifer indicated assent.
      Sir Frank Pearson: I am glad that the hon. Member for Liverpool, Walton (Mr. Heffer) agrees with me. It is most unusual, but we are in agreement on this point.
      Apart from the question of slum clearance, as society becomes more affluent and standards of living rise so the standards demanded in housing rise. Houses which we today deem to be reasonable habitats will in five years' time be regarded as slums.
      Apart from the question of slums and apart from the rising standards of living, Lancashire alone has an estimated rise in population which demands the creation of Chorley new town, Warrington new town, the Ellesmere Port conurbation and, unless the statisticians have been totally wrong, which they may have been up to a point, at least another three towns. So when any Minister says that by 1970 we shall over the country as a whole have reached a balance, I would say that that is a misleading statement and one which undermines the confidence of the industry which must provide the houses for which there will undoubtedly be, in certain parts of the country at any rate, a strong demand for a considerable number of years.
      Of course, there have been other factors which have undermined the situation. No one can over-estimate the difficulties of the high interest rates. That is undoubtedly so, but I would accept the point of view put forward by the Government, that this is an international problem. While this country may have led the way and forced others to follow

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      after us, and while I accept that that may have been so, I also accept that in the Western countries we are in for a period when high interest rates are likely to be the order of the day.
      Against this background I welcome very much the statement made by the Minister this afternoon that he is to extend the allocation of money for loans for the local authorities. He is to raise the amount by another £45 million. That is still £75 million below the level at which it was when the Conservatives left office. Nevertheless, we are thankful for small mercies, and I would accept that this extra allocation will give a shot in the arm to the construction industry and will help to restore confidence.
      However, if hon. Gentlemen opposite the Government really wish to have a buoyant housing programme next year in their run up to the General Election —and I presume that that is what they do want, as anybody would want then I would suggest to the Minister that, from a practical point of view, they must look at this matter just a little more carefully than they have to date. The Minister is totally under-estimating the difficulties of the construction industry. If the Government are to get the houses next year that they want, so that they can go on political platforms throughout the country and be proud of their housing record, they must pay a little more attention than they have paid so far to the warnings which the construction industry has been giving the Government over recent months.
      It may well be all right for the big companies; they have resources to weather the difficult times of the winter ahead of us; but it will be a very difficult winter indeed for the construction industry. The big companies may have the resources to weather the problems of the credit squeeze, but the big companies produce relatively only a small proportion of the goods. The construction industry is in very large measure dependent upon the operations of a multitude of small and medium-sized companies. I will give the Minister this warning, in all seriousness, that through this coming winter those small companies will just not have the resources to weather the winter and the credit squeeze.
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      I therefore hope that the Minister will consider very carefully whether it would not be right to give the construction industry, to see it through this coming winter, some priority in the demands for credit, because that is what it urgently requires. I am myself connected with the manufacture of bricks, a process which goes on and has got to go on; one cannot stop it; one piles the stuff up so that every corner of one's yard is filled with bricks, while one hopes that when the spring comes and the building weather arrives one can sell them.
      After the fine summer that we have had, this coming winter may be one of the hardest we have seen for a very long time, and, if this should be so, I warn the Minister that there will be a multitude of small and medium-sized brick producers who will go out of the business. And when they have gone out they will not come back. If the Minister were a betting man I would be prepared to lay a bet with him that when he wants his houses built next spring there will be a shortage of bricks and of building material.
      I therefore urge that if the Government really want to see their programme extended, in the way they clearly do, and in the way which is essential to their own election chances, they would be well advised to allocate to this narrow front of building materials the relatively small amount of the national resources necessary to ensure that stocks can be carried through the difficult winter months. If they fail to do this, then, when the spring comes, we shall find a shortage of materials, and the houses the Minister requires will just not be built.
      I hope that the Minister will do me the honour of considering this point. I ask him to be good enough to give me an assurance that he will at any rate discuss this question with the Chancellor of the Exchequer. I do not believe that the Government recognise the very real difficulties in which today many firms are, whether they be builders or whether they be manufacturers of building materials. It is all a question of credit, and of short-term credit at that. So I hope that the Minister will take up that point.
      In conclusion, let me underline the point which my hon. Friend the Member

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      for Ormskirk (Sir D. Glover) made about rented property. There is a general feeling, which may be right and soundly based, and which may not, that Governments of the Left are hostile to landlords. Landlords, in the context of today and under the controls of today, can perform a very useful and, indeed, essential function. Gone are the days when the private landlord was a law unto himself, when he could charge what rents he wanted, when he could impose whatever conditions he wanted.
      There is nothing socially wrong today in giving encouragement to putting private capital into the construction of houses, and if the Government of the day cannot produce the conditions under which landlords are checked—well, then, the Government are falling down on their job. I therefore hope that, certainly from this side of the House, but also from the Government benches as well, we shall have a word of encouragement to private landlords to build houses, and houses to rent, because houses to rent are probably more in demand today than even houses to own. Certainly, as my hon. Friend the Member for Ormskirk said, they provide a type of housing which meets the fluid, flexible conditions which people have.
      As I have said, the issue we are debating today is one of the highest political significance. The statistics which we have been given by the Government mean very little; they do not deal with the situation as it is now. The mitigation that the Minister has told us about this afternoon, the additional funds that he is making available from March of next year, will be a help, but does not begin to be a solution of the problem. The next four or five months will be absolutely vital for the construction industry. Unless something can be done to see the industry through what will be a very difficult period, the Government will not achieve their target for next year and certainly will not win the next General Election.
      6.20 p.m.
      Mr. Frank Allaun: The hon. Member for Clitheroe (Sir Frank Pearson) has said some serious things about confidence in the future of the building industry. Those words need careful and serious consideration, and I will offer one or two suggestions.
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      I have recently been approached by a constituent who has no legs. He lives in a house which, like most houses in Lancashire, has no bath, no hot water and no inside lavatory; the lavatory is at the bottom of the yard. This man had been on the council waiting list for 15 years. Millions of people have housing needs; there are young couples who are forced to live with their in-laws, there are those who, in wet weather, have to sleep downstairs because of the water which pours through the roof and makes their bedding sodden. I need not go into this, because most hon. Members know of these things.
      Some hon. Gentlemen think the solution to the housing problem can be summed up in two words, "higher rents". I do not. I think that the housing tragedy can be solved by building more houses. Those suffering from heartbreak housing will rejoice that last year an all-time record or 413,000 houses and flats was achieved. It was obvious from the number of stops that this year there would be a fall in the number of completions. In the first two-thirds of the year the number of completions had fallen by 33,000 compared with the same period last year. I estimate that the drop in completions for the whole year will be 50,000 and that next year the drop will be even greater unless emergency measures are taken.
      There are completely different reasons for the drop in council building and the drop in the private sector. The drop in council house building is because many councils, both Conservative and Labour, have slashed their programmes. This is utterly wrong, whatever the political complexion of the council. In the private sector the cutback in housing results directly from the credit squeeze.
      It may be that in one or two towns in my area, perhaps in the cotton towns in North-East Lancashire where there has been a drop in population, there is no great need for council houses, but those areas are few in number and the need in the rest of the country is desperate.
      Sir Frank Pearson: May I point out that, although North-East Lancashire may be losing population to a certain degree, it is trying to attract population,

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      and has no hope of doing so unless it is prepared to build houses?
      Mr. Allaun: The hon. Gentleman is quite right. Even in these one or two places there is still a need for more housing.
      For most people council housing is the only way to get a home. They cannot afford to buy a house, even if they would like to, because they cannot afford the mortgage and the interest payments. It is wicked to cut back council house programmes when the need is so great; and the worst is yet to come.
      The full effect of what is happening now will not be felt until next year. Council house building in some areas is coming virtually to a stop. If the hon. Member for Stockport, South (Mr. Orbach) catches your eye, Mr. Speaker, he will tell you that not a single house has been planned in Stockport, which has one of the worst housing situations in the country.
      I have nothing against housing associations, but one cannot place reliance on vague suggestions that housing associations will be encouraged by councils to fill the gap. Housing associations lack the resources to do so on a big scale, and in any case they would take a considerable time to develop the capacity to fill the gap left by councils. Housing associations are being used as an excuse, as a cover; and some of them are "phoney" and should be discounted.
      What is to be done about it? The guilty councils, whether they are Labour, Liberal or Conservative—and, of course, the majority are Conservative—should be exposed. The electors should bring pressure to bear on their councils, but, as this may not be sufficient, I want the Government to discuss the matter with the councils, which they are doing, and also to bring direct pressure to bear on them.
      It is no use councils excusing their failure by laying the blame on high interest rates. It is true that rates are high—they are 9 per cent. or 10 per cent. in the market—but since 1965 the Labour Government have provided heavily subsidised loans for new council building at 4 per cent., despite the financial difficulties, and it is greatly to their credit. Had it not been for such loans, council house building would have
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      stopped completely. It may be argued, as the hon. Gentleman argued, that perhaps for the first 18 months or two years, until the first rents come in and the subsidy is paid, the interest rate is high. I admit this, but 18 months or two years is a very short period compared with the remainder of the 60 years over which loans will be available at 4 per cent.
      Another excuse is that, instead, old houses are being improved. No hon. Member is more enthusiastic than I am—
      Mr. Peter Walker: Does not the hon. Gentleman agree that both Conservative and Socialist councils, because of this 18-month gap and the righ rate of interest during that period, tend to leave part of their programme in the hope that interest charges in that period will come down?
      Mr. Allaun: That point was answered earlier, when it was explained that interest rates throughout the world are very high. So the hope that during the 18 months it will come down is very remote. I do not think that this is a good excuse for delaying council house building.
      Nobody in the House is more enthusiastic than I am about improving old houses, but this must be in addition to and not in substitution for building new houses.
      Now we have the latest and worst piece of hypocrisy. Having decided to cut back on council housing, some authorities are suddenly discovering that there will be no need for it. That is very convenient for them. Liverpool is one such authority. Apart from Glasgow, Liverpool is the worst housed city in Britain; it is even worse than Salford. For that council to suggest that it will have solved the problem by the middle of the 1970s, or even by the middle of the 1980s, is a breathtaking and scandalous lie. They will suggest next that there is no need for more council houses in Salford.
      The leader of the Salford Council, Alderman Joplin, when addressing the Conservative Party conference in Brighton, a month ago, said:
      "Let us ask whether we have not reached the stage where, particularly in many large cities, we have built enough council houses and flats."
      I suggest that that shows an ideological dislike of council housing. It is an outrage, coming from a party leader in

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      Salford, where so many decent people are trying to bring up families in homes which are a disgrace to civilisation.
      Public exposure may not be sufficient to make recalcitrant councils act. What can be done? I suggest two alternatives. They present difficulties, but they must be considered. The Government could—and, in my view, should—take powers to refuse to allow councils to cut their programmes in certain areas of great housing need and in certain circumstances. It may be said that this is not permissible. Why is it not permissible, when in the matter of the 11-plus the Government are to take powers to ensure that councils take action? They could take similar compulsory powers to deal with the cuts in the housing programme.
      The second step would be to set up a national building agency to go into such areas and build houses. This has been done on a large scale and with great success by the Scottish Special Housing Association.
      Mr. Edward M. Taylor: Is the hon. Gentleman aware that the Scottish Special Housing Association, which has a splendid record, has now been stopped building houses in Scotland and that this is adding to Glasgow's problems?
      Mr. Allaun: I am asking for such a body to be considered for work in England. The hon. Gentleman is quite right in saying that that association has been most successful in Scotland.
      I suggest that in the public sector there should be additional financial aid from the Government in the 15 worst afflicted areas where such areas are incapable of dealing with the enormous burden which has fallen upon their shoulders. It is a national rather than a local problem and in those areas even more than 4 per cent. should be granted.
      In the private sector 26,000 fewer houses have been built this year as compared with the previous year. And yet there is no shortage of demand for them, nor is there any lack of bricks, baths and other components. Indeed, the manufacturers complain of unused capacity. If that capacity remains idle, then eventually it will cease to exist.
      Why has there been such a fall? It is due to the credit squeeze. If a small builder wishes to put up a row of
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      "semis", he has in mind the fear that he will have those houses on his hands for six months or more because would-be purchasers cannot obtain mortgages. During that time he must pay to the bank on his loan interest of 9 or 10 per cent.
      I would suggest a number of steps are required. First, I suggest that Government loan should be restored to local authorities so that they, in turn, can provide mortgages for people who cannot obtain mortgages from a building society. I am most appreciative of the announcement made by the Minister today that from next March this figure is to be raised to £100 million a year. But I plead with him and with the Treasury, where the decision really lies. to restore the figure to the original level of £195 million. The extra money is badly needed.
      There is then the excellent option mortgage scheme, which has helped 300,000 families on low incomes to take advantage of what in effect is a 2 per cent. subsidy on their mortgage interest. Later in our proceedings today the House will discuss an Order to raise this amount to 2½ per cent. But that is nowhere near enough. I would urge a 5 per cent. subsidy.
      When I recently put this request to a member of the Government, he said that the original intention of the scheme was to give the low income earner the same advantage as he would have obtained if he were a mortgagor paying the standard rate of income tax. But in view of the exceptional seriousness of the housing situation, I suggest that the figure should be raised to 5 per cent.
      Furthermore, the 100 per cent. mortgage scheme in respect of building societies under Government guarantee should be more widely extended. There is also the save-as-you-earn scheme, which is a remarkable investment. Although I have no financial interest in the scheme, I would recommend it to the public at large. It brings a return of 12 per cent. gross to those who paying the standard rate of income tax and investing over a period of five years, and returns are even higher if money is invested for seven years.
      I am glad that the Government have extended this scheme to building societies.

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      This, again, is a form of subsidy, since the Government pay the extra amount beyond the 8½ per cent. normally granted by building societies to investors. If more money flows into the building societies, they are in a position to lend more. If this system is extended it will enable more mortgages to be obtained.
      It is too early to judge the success of this scheme, which started to operate only on 1st October this year. Sir Miles Thomas reports that in the first 10 days of operation 32,000 contracts were entered into. I should like to see a figure very much higher than that so that more people can obtain mortgages to buy their own houses.
      No doubt there will be strong Treasury opposition to some of these proposals. I understand the Treasury's difficulties, but if the country is now in a better financial position there must be some relaxation. Last week the banks exceeded their ceiling of loans by £200 million, and nobody objected. I claim that the first priority in any relaxation should be for housing. Other countries devote a higher proportion of gross national product to housing than we do. In 1967, which is the last year for which figures are available, France spent 6·2 per cent. of G.N.P. on housing, Italy 6·1 per cent., West Germany 5·2 per cent. What was the British proportion? It was a miserable 3·7 per cent. We must devote a higher percentage of our G.N.P. to housing than we now do.
      If I am asked to say whether the money should come from, I immediately suggest that it should come from slashing cuts in our fantastic arms expenditure. I say to the Government that if they relax the credit squeeze on housing they will find that Labour will be blest.
      6.40 p.m.
      Mr. Wallace Lawler: I listened with interest to the speech made by the hon. Member for Worcester (Mr. Peter Walker). There is at least one point on which I am in complete agreement with him. He reminded the House that the Prime Minister had promised the people that when his Government were returned to office their first priority would be that of housing.
      Like the hon. Member for Worcester, I thought it rather significant that in his speech on 28th October, the Leader of
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      the Opposition graciously allocated 266 words to this enormous problem and, to put right a slight inaccuracy by the hon. Gentleman, in his reply the Prime Minister devoted just one. I hope that the electorate will take careful note of the way in which the Prime Minister attaches first priority to the subject of housing.
      I refer next to what I am sure is seldom spoken of in this House. I notice that the hon. Member for Ormskirk (Sir D. Glover) is no longer with us, but he referred to self-build housing associations. The hon. Member for Worcester said that if his party was returned to power at the next General Election, it would see that the housing association movement was properly assisted. I suggest that he could make a start in the implementation of that pledge even before the next election by trying to persuade the Tory-controlled Birmingham City Council to return to self-build housing associations the 30 per cent. grant instituted by the former Socialist-controlled council and taken away the moment that the Tories gained control.
      Words mean nothing unless there is action behind them. In this respect, I want similarly to castigate the Minister. He said that the Government were giving very generous assistance to housing associations. I ask the House to consider that for a moment with a view to discovering where the generous assistance to self-build associations is.
      In Birmingham, over 1,000 families have built their own homes in the last few years. Apart from the grant which I have referred to, and which has now been taken away from them, in some cases they have bought the necessary land for ten times the amount paid by the local authority only a few years ago. Then they have borrowed from the local authority or building society at the full rate of interest the amount of money required to build. They are repaying every penny with full interest and without any help from the option mortgage scheme. One begins to wonder where the generous assistance is that the Government give to self-building housing associations and whether the Minister should not suggest to the local authority that it would do well to reinstate the grant to which I have referred if he wants to see the continued growth of such an excellent movement.

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      Councillors do not like putting up rents. They know that it costs them votes. However, most local authorities are at their wits' end. In Birmingham, for example, the council even resorts to the rather mean trick of raising the already high rent of a post-war house the moment that a family moves out, so that the incoming family is charged 10s. or 15s. a week more. I am a member of that authority's housing committee. We who serve on that committee know in our hearts that this is wrong, but we hesitate to let go the extra £250,000 which it brings in to an always bankrupt housing revenue account.
      I am sure that the Minister does not like approving higher rents. He must regret bitterly the decision that every proposed increase should be referred to him for approval, judging from recent Press articles. Rent strikes and protest marches have brought home the fact that tenants do not like their rents going up, especially when electricity and heating costs more and the prices of the basic necessities of life spiral upwards. In addition, for the vast majority there is a stop on wage increases.
      Is there any answer? I am sorry that the hon. Member for Salford, East (Mr. Frank Allaun) has left the Chamber. He was a member of a committee of hon. Members opposite which endeavoured to make some useful suggestions in a Labour Party booklet entitled "Housing", published a month or so ago. It contains a good deal more helpful advice than we have heard today. However, it also contains some amazing inaccuracies and wrong assumptions, one of which is that the problem can be solved by the pooling of rents and a new regional set-up. In areas such as London and Birmingham there is already what might be regarded as a large regional set-up, but there has been no attempt by the authorities concerned to bring about a pooling of rents.
      A more effective answer would be to give thought to the stabilising of all council rents, especially those of post-war houses, which are high enough already, rather than placing too much emphasis on deciding what should be the ceiling on further increases. Some new thinking is required. I would like to see the Minister considering a crash programme for the construction of small modern system-built instant homes.
      Mr. Howie: The hon. Gentleman has referred to inaccuracies in a certain document. I have read that document, and I would be interested to know what are the inaccuracies. Instead of merely asserting that there are inaccuracies, will he tell us where they are?
      Mr. Lawler: I will do my best to meet the hon. Gentleman a little later.
      To return to my point, I would like to see the Minister considering a crash programme which would involve the construction of small modern system-built instant homes. In Birmingham quite recently, the council carried out a survey on one municipal estate of pre-war houses. It was found that 40 per cent. of those houses are under-occupied and have two empty bedrooms. They are occupied by middle-aged or elderly people who would be glad to move out of them. They cannot be expected to move into the hostel-type new dwellings which we are building at the moment, but they would be prepared to move into small one-bedroom dwellings with modern conveniences.
      In all other respects, such accommodation might not be entirely dissimilar from the prefab-type dwelling. It is amazing how many people come to Birmingham's advice bureaux asking if they might be considered for a prefab home, the life of which was supposed to have ended 15 or 20 years ago. Their reason for doing so is that such accommodation has a low rent and all the conveniences that they require, since they no longer want extra bedroom facilities.
      There is surely something for us to explore here. It is obvious that the extent of under-occupation will continue until we have much more positive action at local level, and I suggest at Ministerial level, when looking at the plans submitted for large-scale housing projects, particularly, concerning one- and two-bedroom dwellings being included in all future developments.
      Home owners have no remedy for spiralling interest charges on mortgages. They cannot even move to cheaper houses because the mortgage famine has paralysed the housing market. Councils are having to borrow at the usurious rates of over 9 per cent., and some are having to pay as high as 10½ per cent. Building

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      societies are torn, because another rise in interest rates would cause real hardship. Yet houses and flats are empty because people cannot get mortgages, and the only way for building societies to get in more money is by higher interest rates. It is an appalling thought.
      Grants for improvements have not been mentioned in the opening speeches today—[HoN. MEMBERS: "Oh."] I have been here throughout the two main opening speeches and I listened attentively. Grants for improvements have been raised. But how are people to get the money to match each £1 of grant? Banks will not lend it to them, because of the squeeze, building societies have no money to spare, and people are frightened to use their dwindling savings. Who knows what will happen to prices next?
      Some hon. Members have mentioned their concern about evictions. Both councils and private landlords are still evicting tenants. We all know this, but we do not mention it in the House very often. Perhaps we are ashamed and would rather not think what happens to people who are evicted because they have not been able to cope with the problem of high council or private rents. Are they supposed to find something cheaper in the private sector or to abandon themselves, as thousands of families have, to the purgatory of hostel or slum half-way house existence?
      Private sector tenants have a lower average income than council tenants. Yet their landlords have no subsidised interest rates. Their landlords have no miraculous source of funds to match the available grants £1 for £1.
      Despite the old grants, our housing stock became a disgrace. According to the medical officers of health survey, nearly a fifth of our homes are unfit. The new grants were essential for councils or our municipal housing would have become noticeably the disgrace of Europe. But the grants will not help the the private sector very much.
      It is interesting to note that the Birmingham City Council, two years ago, with a great deal of fanfare, piloted through the House its Bill to grant rebates and assistance to tenants in the private sector. The powers available in that Bill lie on
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      one side. Today, the council puts forward the excuse that it has not got the money from the rates to give equal treatment to tenants in the private sector.
      Housing is becoming an explosive mess. It is all to the good that councils have subsidised loans for new houses and grants to improve the worst of their housing stock, which should not be in that state, but councils still need money for housing. Every time the Socialist Minister approved a Conservative council's rent increase he admitted that that council needed the money for repairs, for maintenance and for rent rebates for those in real need.
      Costs are soaring. S.E.T. must be abolished for the construction industry. We have a housing crisis, yet this extra cost is still allowed to burden the industry. I take as an example Meriden. The hon. Member for Meriden (Mr. Speed) cannot be with us because he is at sea. I mean that in the nautical sense. If he were here he might tell us about the new town which is rapidly growing up in Chelmsley Wood, on which so many had set high hopes. Chelmsley Wood has thousands of new tenants paying post-war rents. Those tenants are beginning to organise tenants' associations, and those tenants' associations are saying. "Please reduce our rents and rates from £6 plus per week to £4 per week to fit in with what we can afford to pay."
      How can the local authority possible do this when it is already operating a virtually bankrupt housing revenue account? If the only way that we can manage the economy is by the example of the present usurous interest rates—hon. Members may not like this very much; nor do I—then we had better face the facts and cut our housing standards. Better slightly less luxurious standards—[HON. MEMBERS: "Oh, no."] Yes—[HON. MEMBERS: "No."] Even if some of my colleagues disagree, this is the stark reality. Better slightly less luxurious standards that people can afford than building Rolls-Royces with, for instance, magnificent heating systems that most of the people cannot afford to run. Hon. Members opposite indicated their dissent to that. But let them talk to the people who cannot afford to switch on their heating systems.

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      At this point I should like to refer to one of the inaccuracies which has aroused the curiosity of one hon. Gentleman opposite. In this book there is talk of providing overall heating in homes. I am willing to produce the page in that book, after the debate, to any hon. Member who might like to meet me outside. What is meant is the facilities for heating. Thousands of homes have expensive facilities for heating—expensive from a capital view point—but the tenants have never switched them on and dare not do so. Let those who say that there must not be the slightest departure from the present luxurious standards answer the questions that the tenants of those houses are asking.
      Mr. Archie Manuel: The hon. Gentleman has referred to heating. It is a serious matter if the installations are there and are not being used for heating, especially if old people and children occupy these homes. Is the hon. Gentleman saying that wage rates in that area are so intolerably low that people cannot afford the standard rent?
      Mr. Lawler: I am saying, and I repeat, that the heating systems are there and are not being used. If the hon. Gentleman wishes to pursue the matter further, I suggest that he refers to the report that was drawn up last year by the Secretary of State for Social Services, who will no doubt be able to show him the result of the survey. It includes a reference to people living in post-war dwellings using oil and paraffin stoves, rather than the expensive heating equipment to which I have referred. The hon. Gentleman might like to go on to find the many and varied reasons—he has already mentioned one—why these people are being forced to do that.
      Parker-Morris standards are, indeed, luxurious. At the moment we do not seem able to afford them. Yet at one time—most of us were adults then, and I can remember it—we had about 20 years of 2½ per cent. interest rates. At that time we could have afforded those standards. We are paying a terrible price in housing hardship and general misery for our recent economic policies.
      The extent to which both post-war Governments have allowed incredibly high interest rates to penetrate, and now almost completely suborn, both the public
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      and private sectors in housing, is, in my opinion, akin to economic lunacy. The stark reality of the present financial madness only comes to us when we sit on committees at local level and have to make decisions and see the financial implications involved.
      I give one example in the private sector to illustrate this lunacy. The City of Birmingham was this year collecting a total of £16,400,000 in rents from its municipal houses. But the amount it will have to pay in interest charges alone will amount to £16,800,000 without any redemption payments or any reference to maintenance and the very important item of repairs, which has been mentioned by some hon. Members in the debate.
      In the public sector, what is the hope or the opportunity of a young couple who cannot turn to a housing association in order to buy a house? If they buy a £4,000 house at the present rate of 81 per cent., repayable over 25 years, they pay a total of £9,771 ; for a £5,000 house over 25 years, they pay a total of £12,214; if, in London, they are lucky enough or bold enough, or are prepared to face possible future eviction, to buy a £6,000 house, they will repay £14,657.
      How many hon. Members will want to argue too much about the fact that this adds up to economic lunacy? The price of land has soared and is still soaring. It is as much a question of supply and demand as rent. It costs more and more money for land for roads, houses, schools and hospitals. Each 100 acres of land released for house building costs nearly £750,000. There are no cheap loans to councils for this; land is just not being released. Every builder and every council knows it, and the Land Commission itself knows it. I wonder, however, whether the Ministry knows it.
      Mr. Richard Buchanan rose—
      Mr. Speaker: Order. Interventions prolong speeches, and many hon. Members wish to speak.
      Mr. Buchanan: The hon. Member for Birmingham, Ladywood (Mr. Lawler) has talked about the income of Birmingham City Council in housing revenue. Will he tell us how much the Government pay towards the city's housing revenue account?
      Mr. Lawler: For the purpose of the illustration I was making, that is irrelevant. It is on interest charges alone the money paid to the moneylenders.
      I was making a comparison about economic madness and I did not at that point make any direct reference to the Government. But it is well known that this year and, indeed, since 1965, the Government have refunded to Birmingham all interest charge payments made in excess of 4 per cent. and that they will continue to do so.
      The significant point is that, despite this refunding over the past three years, we still have the position that exists this year. The Government subsidy to some extent will be used by Birmingham, and must be, for administration, repairs, and so on, as well as for the reduction of interest loan charges. We should be prepared to remember that.
      The Ministry is still turning down applications for loan approval for services necessary to release land. But the land shortage is so acute that housing starts will be just above the 300,000 mark this year, if the Minister is lucky, and next year may well be under 250,000. The shortage has forced prices so high that people with land are getting enough for it to pay the levy and still have as much money as they would have done before. Only the public suffers. It has to pay the extra cost of collecting the levy which, according to the last published figure, at about 25 per cent. of the money collected, is a very expensive luxury.
      I was exceedingly glad to hear the Minister's announcement that he will be increasing, although it might be insufficient, the availability of money to local authorities for mortgages. I believe that this has to be done and with some consistency. If the local authority is not guaranteed consistency in continuing local mortgages, surely there might be a case for this sector to be given greater help, perhaps by the setting up of a new national housing trust which would be privately sponsored and administered. Many people are keenly concerned with the social aspect of housing and would be prepared to contribute to that.
      Nothing is more frustrating to the already much harassed home seeking family than to go a long way towards buying an almost new or sometimes old
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      house and then, after various visits by district valuers and local government officials, to be told at the last moment that there has been a change of Government policy and that the local authority therefore cannot provide a loan. I hope that we can have an assurance that the stop-go policy of the past few years in this respect will not apply for the remainder of the Government's life.
      In conclusion, I want to put four suggestions to the Minister. I hope that he will be able to consider some advance implementation during the remaining life of the Government to these cautious suggestions. First, there has been an excellent suggestion, with which I agree at this point, that the 4 per cent. ceiling in respect of interest charges, which is guaranteed to local authorities, should be extended to all housing activities in the private sector and, indeed, to all housing associations.
      The book I have referred to mentions co-ownership and cost-rent associations. There are also self-build housing associations. This seems to me to be a proper and fair suggestion. If we can give 4 per cent. in the public sector we should be prepared to give it wherever it is obviously needed, including house buying in the public sector as well.
      Secondly, I hope that the Minister will agree that local authorities should be asked to deal much more positively with the relationship of under-occupation to over-occupation along the lines I described earlier and that he will assist such authorities to carry out plans which would involve the securing of more land in order perhaps to do a crash programme of small, system-built instant houses.
      Thirdly, I hope that the right hon. Gentleman will give some thought to the importance of setting up a voluntary housing advisory service, particularly in the big cities, and giving assistance to those voluntary bodies which are beginning to do so in order to give all possible help to families anxious to become home owners. The need for such a voluntary advisory service has long been seen.
      Fourthly, I hope for an assurance that the right hon. Gentleman will ensure local authorities being able to play a continuing part, and consistently, in being

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      able to make available all the loans that are wanted for housing locally, including private applications at the local level.
      Lastly—[HON. MEMBERS: "Hear, hear.") I hope that the right hon. Gentleman will feel that there should be some directive to local authorities about the excessive charges being made to some self-build housing associations in respect of land purchases from local authorities. At places like Kidderminster and Bedworth, near Nuneaton, and certainly in larger cities like Birmingham, in some cases the prices charged have been as high as 10 times the price paid originally.
      I realise that there is a legal requirement on local authorities to sell at market value, but where such local authorities are not prepared to give a grant to low-income members of self-build housing associations, there is a strong case for saying that the Minister should exercise his authority under the Act and give a directive to local authorities so that much more reasonable charges could be made to people who, after all, are only endeavouring to solve their own housing problems by way of self-build housing associations.
      I do not propose to detain the House—[Interruption.]
      Mr. Greenwood rose—
      Mr. Speaker: I remind the right hon. Gentleman that interventions prolong speeches.
      Mr. Greenwood: Mr. Speaker, the aim of the House is to get at the truth. 'The hon. Member has sounded a clarion call for the lowering of standards and, apparently, the abandonment of Parker-Morris. Has he been speaking for the Liberal Party? Is this the official policy of his party?
      Mr. Lawler: I am not speaking for the Liberal Party. I do not have to submit any speeches to my party, or have them vetted. My responsibility is to the people who elected me. My party is secondary to that.
      I hope that the Minister will not mix these things up. Being an official spokesman for the Government, and even a Cabinet Minister, he should know that he still has some responsibility, in some respects, to the people who elected him. I hope that there will not be a suggestion
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      about the respect that I hold for my party, but my own first priority is for those whom I represent in the House.
      I did want to make one closing point—[Interruption.] I am prepared not to make it. It would take me a long time to go through the book to which I have referred and point out in detail the inaccuracies. I was intending to give the details to Mr. Frank Allaun, and not refer to them in the debate. I am prepared to do that if the hon. Member so desires.
      Mr. Speaker: Order. The hon. Member should not refer to another hon. Member by his name; he should refer to him by his constituency. I remind the House that the Chair has appealed for brief speeches, and that many hon. Members wish to speak.
      7.12 p.m.
      Mr. Eric Heffer: Whether or not the hon. Member for Birmingham, Ladywood (Mr. Lawler) was speaking officially for the Liberal Party, it is important that the official Liberal Party should repudiate what he said about standards and make it clear to the House and the country that it is not in favour of cutting housing standards. I am sure that most hon. Members would agree that despite the progress that has been made our standards are still not luxurious, and we need to go in the opposite direction to that suggested by the hon. Member.
      I want to deal with the reference made by the hon. Member for Worcester (Mr. Peter Walker) to the television play "Cathy Come Home". Apparently he discovered that there was a housing problem for homeless people only when he saw that television play. Many hon. Members besides myself who have been city councillors for many years in cities like Liverpool have had to deal with these problems for the last 10 or 15 years —especially under the Tory Government. It is not a new problem. Unfortunately, we have not solved it. The problems worsened when the Tory Government were in office.
      I want to make it quite clear that it is not the responsibility of this Government that we have "Cathies"; it is the responsibility of the whole nation, and has been so for many years. The problem was never solved by the Conservative

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      Government. This Government have done more in terms of the numbers of houses built than any previous Government. Nevertheless, it is not enough. It has not solved the problem. We have a long way to go. Far too many people are living in slum and overcrowded conditions, in houses that should not exist in this country in 1969. It is the responsibility of each of us to make certain that these slums and overcrowded conditions are wiped out at the earliest moment.
      I agree with what the hon. Member for Ladywood said about interest charges. That was the most important part of his speech—a rather lengthy speech; I hope that in future he will learn to cut down his speeches. The question of interest charges to local authorities and those who are building and buying privately is the most serious problem with which we have to deal. The hon. Member was quite right about that. When I was on the Liverpool City Council we were in the fantastic position of borrowing annually to build our houses in the forthcoming programme while we were paying out the same amount of money by way of interest. Absolutely mad! It is not possible to contain the pressure for increased rates on that basis. Most Socialist local authorities gave a very good rate subsidies, and when the Tories got in they knocked them off. This meant that added burdens were placed on the shoulders of council tenants.
      I know this problem backwards. I have lived with it for years, as a Liverpool city councillor. It is true that we never balanced the budget, in the sense that the housing revenue account would have come out right without either rate subsidies or rent increases to council tenants. I once said in Liverpool that if we went on in that way it would take a millionaire to be able to live in a council house. We have gone part of the way towards solving the problem, but not all the way. The 4 per cent. is something of which we should be proud.
      I want to give some figures concerning my city. In 1963–64 the Government paid the Liverpool City Council £1,328,576 in subsidies. In 1968–69 we were paid £2,433,615—money which was almost double the subsidy. Even then
      904
      it did not solve the problem. The hon. Member for Worcester nods his head. He has no solution either. In fact, his suggestion is the worst possible one. It is the opposite of a solution.
      In 1965–66 the rate subsidy was £18·1 million. In 1969–70 it will be £23·8 million. Liverpool Tories are saying, "We kept the rates down". I should have thought that the rate subsidy made some contribution towards doing that, but they do not tell that to the general public.
      The hon. Member for Worcester is a schizophrenic. We expect him to be critical of the Government, and if when he spoke earlier he had not criticised my right hon. Friend, he obviously would not have been earning his position on the Front Bench opposite. However, in the debate on 19th March last he said:
      "As we all know from our experience in the constituencies, they"—?
      that is, those requiring council houses—
      "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."—[OFFICIAL REPORT, 19th March, 1969; Vol. 780, c. 528–9.]
      The hon. Gentleman said virtually the same today.
      However, it is interesting to note what the hon. Gentleman said when addressing a conference of the Urban Research Bureau on 7th June. His remarks were not reported in the national Press until 6th October. I do not blame him for that, but in view of what was said the other day about how certain news is rushed to the Press, I wonder what, if any, influences were exerted to cause this delay. His remarks were reported in the Sun, but I have confirmed them from the text of his speech. He was reported as having said:
      "I hope Conservative councils will take great care to resist the temptation to go on building council houses for all sorts of seemingly good purposes."
      The report went on:
      "New Conservative housing chairmen had a tendency to prove to Socialists that they could build even more council houses than their predecessors. All sorts of perfectly good social reasons were advanced for doing so. But the same housing chairmen should find good economic reasons for releasing many other council houses for owner-occupation, he said."
      Mr. Peter Walker: No doubt unintentionally, the hon. Gentleman has missed out a whole line from my speech on that occasion, I also said:
      "I do not mind their finding the good social reasons for doing so …".
      Mr. Heffer: The hon. Gentleman added:
      … providing that at the other end they find good economic reasons far releasing many other council houses for owner-occupation houses for which there is no social argument for their retention in the public sector".
      That is the end of the sentence, which the hon. Gentleman did not quote.
      I regarded the hon. Gentleman's speech on that occasion—he said virtually the same thing today—as an incitement to Tory local authorities throughout the country to stop building council houses. By making remarks of that kind the hon. Gentleman is going against the whole concept of the 1957 Act, which lays a duty on local authorities to build houses for people who need them. The public prosecutor should consider his statement because I regard it as incitement. [Interruption.] I hope that he will, and I will personally send him a copy of the hon. Gentleman's speech.
      Mr. Peter Walker: And an explanation of it?
      Mr. Heffer: My right hon. Friend rightly said that Liverpool City Council's record has been good, be it Socialist or Conservative, from the point of view of house building. It has been good, but only up to this time. What will happen following the remarks of the hon. Member for Worcester? On the basis of certain statements made by him, Liverpool City Council is to reassess the whole situation.
      The 1969 Act gives an opportunity for a great number of houses to be rehabilitated, although I do not recall hon. Gentlemen opposite being particularly enthusiastic for that Measure. The Conservative City Council now says, "We will carry out a rehabilitation programme for houses", but out of the 45,000 houses that are regarded as unfit, only 16,000 will be removed. Considering the type of accommodation that we have in Liverpool, that figure is far too low and needs close attention.
      906
      The council goes on to say, in effect, "This means that we can cut back on the housing programme for the future". The trouble is that the council believes that from 1972 onwards there could be—if not "will be"—a surplus of tenancies. Indeed, it has been suggested that by 1980 there will be 21,000 surplus tenancies. It is a bad joke to the people of Liverpool when they hear such estimates because even with a programme of 2,000 new houses a year, with 16,000 slum houses to be removed and 12,000 people on the housing register, it will be impossible to have 21,000 surplus tenancies by 1980.
      This argument is being used by the council as an excuse. The Housing Act which the Labour Party introduced is being used as an excuse to cut back on the house-building programme in line with the ideologies of hon. Gentlemen opposite, and particularly the hon. Member for Worcester. This is a serious situation, and the hon. Member for Worcester must accept responsibility for what flows from his remarks.
      I complained about long speeches and I do not intend to follow suit. I will, therefore, restrict my remarks to a few major topics. The whole question of interest rates must be further examined from the point of view of assistance to local authorities and private builders. We should now set up a public building corporation which should be divided into a number of areas associated with the areas of greatest need. The building of local authorities should be augmented by the Government, on the lines followed by the Scottish Housing Association, and houses should be built in areas of greatest need so that we have a crash programme to overcome the serious problem that exists.
      Whatever happens, S.E.T. must go from the building industry.
      Mr. Buchanan: Including speculative building?
      Mr. Heffer: I appreciate my hon. Friend's comment, but I know what I am saying when I speak about the building trade, if about nothing else. My people in the industry are finding themselves unemployed in areas like Liverpool which have the greatest housing need. A contributory factor is S.E.T. This tax must be lifted from the building

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      industry at the earliest possible moment. At any rate, it must be lifted from house-building, which should be given absolute priority.
      The other point which I welcome in the Gracious Speech is the decision to deal with the labour-only problem. I hope that we shall see legislation as early as possible.
      My right hon. Friend deserves all credit for what we have done. Much of the argument of hon. Members opposite is sheer hypocrisy But we should not be complacent. We should be more determined than ever to solve our housing problem—one of the greatest social needs of our country.
      7.31 p.m.
      Mr. Edward M. Taylor: The hon. Member for Liverpool, Walton (Mr. Helfer) and many others have spoken with sincerity about the housing problems of England, but I want to emphasise again the serious housing problems of Glasgow and Scotland in the hope that the Minister will say something specific about them.
      Only a few days ago there was a by-election in the Gorbals in Glasgow, probably one of the worst housed areas in the country. Members of both parties, members of the Government and of former Governments, came to the Gorbals to make pledges and promises and suggestions about what could be done. I hope that, now that the election machines have rolled away back to Westminster, the problems of this area and other areas of Glasgow and Scotland will not toe forgotten. There are tens of thousands on our housing list, and Glasgow faces great problems of squalor, over-crowding and insanitary conditions.
      Our problems have existed over the years and they are mainly those of money and land. The hon. Member for Glasgow, Springburn (Mr. Buchanan), as a former Glasgow city treasurer, will agree that the basic problems are money and available land. One of the Government's election pledges which we will make sure they do not forget was that there would be a target figure of 50,000 houses, overcome by 1970. Certainly the number of houses has increased, but we are a long way from that figure. The worrying fact is that the pace seems to be slowing down. In the first nine months of this year the
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      number of houses started in Scotland was 2,500 fewer than in exactly the same period in 1967.
      Mr. Buchanan: I am sorry to interrupt again, Mr. Speaker, against your admonition, but the hon. Gentleman has referred to me. The Tory Party in control of Glasgow Corporation has set back the redevelopment programme by six months and, when building 5,000 houses a year, this means that there will be 2,500 houses a year fewer than when Labour was in control of Glasgow Corporation. With the help of the Scottish National Party, the Tories have ignored the Government's entreaties to build overspill houses in Erskine. This means a loss of another 13,000 houses to Glasgow. But the Government are not to blame—it is the party in control of Glasgow Corporation.
      Mr. Taylor rose—
      Mrs. Winifred Ewing: Since my party has been mentioned, and I am its only representative here, perhaps the hon. Gentleman will allow me to say that my party took a special view about overspill houses, because it had ascertained that the rents of these houses would be so high that the people could not afford—
      Mr. Speaker: Order. We cannot have threefold debate.
      Mr. Taylor: I do not say that it is all the Labour Party's fault. I am trying to make constructive suggestions. However, on Erskine, if the hon. Member for Springburn thinks that the Labour Party should not be ashamed of the intimidation and blackmail which they are using against the Corporation of Glasgow to force it into something which is political lunacy, then I am surprised. He should be ashamed to mention Erskine, especially as he is a former city treasurer.
      Glasgow simply cannot house all its people within its boundaries. For this reason, we have an overspill problem, under which Glasgow makes a considerable contribution, over many years, for every house built in overspill towns. Erskine is an area near Glasgow, and the Government say, "We will get the Scottish Special Housing Association "which has now stopped building in Glasgow as a result of a decision of the Labour Government—" to build 4,000

      909
      house in Glasgow, if you, the corporation, will build 2,000." The result will be a greater additional financial burden on the city, quite apart from the normal burden of overspill.
      Glasgow has a capital debt of over £320 million. We have a rate burden which is almost the highest per head of population in the country. Also, as the hon. Member well knows, for Glasgow to accept this would impose a burden greater than that of overspill, which he and others in his party have condemned. I have had an answer about Erskine today from the Secretary of State:
      "If the Corporation are to build no houses in Erskine. it seems only reasonable that they should be asked to make a special contribution."
      These are the words of the Secretary of State, not of me or of any other Tory. This is how the Government are helping Glasgow—by asking for a contribution additional to the burden of overspill.
      So Erskine has an answer, according to the hon. Member. We are being asked to pay much more than even overspill, the pledge of 50,000 houses will not be met, starts in Scotland as a whole are considerably down and there is this enormous burden of interest. Admittedly we have the advantage of a 4 per cent. rate on houses now being built, but in Glasgow there are 120,000 houses already built, and, on the cost involved, £326 million, interest must be paid at 9 and 10 per cent.
      But this is not the way to discuss this matter. The question is "How do we solve this?" and not "Who built what?" One thing which has not been mentioned and which is desperately important is the fact that we have concentrated in the past far too much simply on building houses, houses and more houses instead of on communities. In Glasgow there are tens of thousands of people on the waiting list, but one can put one's name down in 1968 or 1969 and can get a house in Easterhouse, an area represented so eloquently by the hon. Member for Glasgow, Provan (Mr. Hugh D. Brown), after only eighteen months. There are enormous housing areas in Glasgow starved of amenities, and the people who live there spend a considerable time working out how to get out of them.
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      These are much better houses, so far as amenities, roads and conditions are concerned, than the slums from which they came, but they still spend their time trying to leave.
      While we need houses so desperately, I hope that the Government, or the Opposition, will not make the same mistake of building hundreds of thousands of houses without the essential ingredients of communities. I have the pleasure to represent what is acknowledged to be the largest single housing scheme in Europe, at Castlemilk. It is settling down very well. We have three great schemes in Glasgow—Easterhouse, Drumchapel and Castlemilk. After 15 years we are beginning to get amenities. We have just got a swimming pool, we have a library and we have our third secondary school, and children are still being transported in buses away from the place.
      There are housing schemes in Glasgow and other parts of Scotland with none of these things—without even a café or a place for people to meet. It is no help to the people of Glasgow or to those of other areas if in a wild rush to overcome the housing problem we simply build more jungles, with no heart, soul or feeling of community.
      I accept that many things need to be done in housing, that the Government have made promises which have not been kept, that interest rates are sky high, and that owner-occupiers are having a miserable time. The Government throw about facts and figures of the extra houses which have been built, and we on this side talk about the Government's broken promises and pledges. But this is not the answer for the many people who are living in good houses but in places which are not communities and which are not fit and proper places in which to bring up children.
      I hope that, irrespective of what we think the figures should be or how we can build more houses than the other party, we shall not make the terrible mistake which has been made over and over again of building rows of tenement blocks —we have one in my constituency bigger than the city of Perth—without thinking about the importance of the quality of life in these areas and how we can provide the basic amenities on which community life can be based. Houses are not just places in which to sleep and eat. They

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      should be the foundations of a community. I hope that we shall hear more from the Government and from all those interested in the subject about building communities and not simply rows of houses.
      7.41 p.m.
      Mr. Julius Silverman: I propose to take up only one comment of the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) —that the main difficulties in building houses lie in money and land. The Government have a good housing record. The Minister set out a number of things which they have done. The City of Birmingham is not one of the places to which the Ministry found it necessary to send a circular. Its housing record is excellent. But I can safely say that without the provision in money and land which the Government have made Birmingham's housing programme would have ground to a halt. Without the massive subsidies given under the housing subsidies Act, and without the land provided at Chelmsley Wood, it would have been impossible for the Birmingham council to continue its housing programme.
      I mention that because another application is likely to come before the Ministry soon. An inquiry is at present being made into it. Birmingham requires land in South Worcestershire. Whatever the political complexion of the council, my Labour colleagues and I in Birmingham support the application without reservation. I know that the Minister must act in a semi-judicial capacity in arriving at a decision. No doubt he will bear in mind that it is necessary that Birmingham should be provided with this land so that it may carry out its programme. Birmingham has not been so fortunate with previous Tory Ministers in its applications for land, which have been turned down.
      It is shocking that five Worcestershire Tory Members of Parliament should make a public pronouncement objecting to this application, saying that they do not want Birmingham council tenants in South Worcestershire. They may talk in the House about the Government's housing record. But when it comes to the basic ingredient in a housing programme, namely land, they object because they desire to preserve the open spaces around their wealthy constituents.
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      I wish to say a few words about the rate of interest, to which the hon. Member for Birmingham, Ladywood (Mr. Lawler) referred. It is easy to pose the problem and not so easy to put forward a solution. The rate of interest is one of the ingredients of a free market economy—a free market in capital. It is what we used to call in the old days the capitalist system. Now we call it the free market system. It is the law of supply and demand operating financially.
      I do not say that I am happy about what the Government are doing or are not doing about the rate of interest. I should have liked to see a programme which involved capital controls on investment and other financial restrictions by which alone a Government can control its financial destiny and exercise control over a major factor in the economic life of the nation; namely, rates of interest. Unfortunately, the Government have not done it. Even the halting measures taken to restrict credit and capital abroad have been bitterly resisted by the Opposition. The Liberals also are not very enthusiastic about them because they believe in a free market economy. The hon. Member for Ladywood posed a question about interest rates. He did not suggest a solution. No solution is possible within a free market economy. The Government would have to take measures which would involve a confrontation with the financial institutions of this country.
      Mr. Lawler: Cutting defence.
      Mr. Silverman: I agree with that. But if we make cuts in defence expenditure, there will be plenty of competitors for the money released. The Government have taken certain measures of financial control over rates of interest. It has not taken others. I do not think that either the Opposition or even the Liberals would have taken them.
      Like others, I welcome the Government's announcement that the mortgage loans available to local authorities will be increased to £100 million. Like my hon. Friend the Member for Salford, East (Mr. Frank Allaun), I hope that the Government will increase the figure. The financial objections to doing so are misconceived, because in places like Birmingham the money is in fact lent. But it

      913
      is lent by the sleazy financial institutions and financial concerns charging thoroughly exorbitant rates of interest which result in gross exploitation of people who badly need accommodation. Some of the worst victims are the immigrants. I have heard of shocking rates of interest being charged.
      I therefore ask the Government, as soon as they can, to increase the amount which can be raised by responsible organisations like local authorities to provide money to finance the purchase of houses.
      I and others are disappointed at the consequences of the Leasehold Reform Act, notwithstanding an amendment, for which I am grateful, made by the Government in the Housing Act which virtually overruled a Land Tribunal decision. The main reason why the Leasehold Reform Act has tended to turn sour is that a large number of ground landlords are asking thoroughly exorbitant prices for leaseholds. If the tenant does not like it, his only remedy is to go to the Land Tribunal at enormous expense far beyond the pocket of the average working-class buyer. These landlords are using the Act to exact the most exorbitant prices.
      Is it possible to introduce yet another amendment to the Act? I suggest a simple procedure allowing the decision to be made by the district valuer without there being any necessity to go to the Land Tribunal and through all the paraphernalia. People who draft legislation are apt to forget that court cases can be expensive. It was, I think, Lord Justice Darling who said that justice, like the Ritz, is open to everyone. In practical terms, such tribunals are not available to the working man, because he just cannot afford to use them.
      The Under-Secretary of State for Wales (Mr. Edward Rowlands): I would point out that when a similar situation was found to exist in South Wales a number of leaseholders there who faced exorbitant demands got together and forced a reduction from £600 to £80 and £40. The solution may lie in these owners getting together into an association and, if necessary, sharing the cost of going to the Land Tribunal.
      Mr. Silverman: I agree with my hon. Friend. I have urged these people to form themselves into associations. We
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      should encourage that. But it can take a long time to get a test case before the Land Tribunal.
      The Minister of State, Ministry of Housing and Local Government (Mr. Denis Howell): I am grateful to my hon. Friend, especially for so kindly confirming that he and I have addressed several meetings of leaseholders and tried to bring them together. Our experience within the Ministry is that the amended legislation has had the effect of reducing prices pretty considerably. I have in mind the decision of the Land Tribunal to which he referred. I assure my hon. Friend that we shall keep the matter under constant review. If he and others have any unfortunate experiences of this sort, I hope that they will draw them to our attention.
      Mr. Silverman: I could give my hon. Friend a number of unfortunate experiences of leaseholders being obliged to pay a price that I consider to be 100 per cent. too much simply because they did not want to go to the Land Tribunal. I know that the Government want the Leasehold Reform Act to work ; so I hope they will consider what I have said.
      The Government have a good housing record, but, like other hon. Members, I do not think that it is good enough. I do not feel that the Government think that it is good enough, and I hope that they will do more, bearing in mind the points that have been raised today.
      7.55 p.m.
      Mrs. Jill Knight: I seek to draw to the attention of the Minister of Housing and Local Government just one fact which is of considerable concern to many owner-occupiers. It is none the worse for being concerned with owner-occupiers, because the Minister has earlier indicated his recognition that those who make the effort to house themselves deserve all our care.
      If a family decides to move house, or is forced to do so because of a change in the employment of the breadwinner, it will seek a new house and put the old one on the market. It is extremely difficult to buy a new house without selling the old one. It may be able to arrange a bridging loan with the bank, or the firm employing the father of the family may

      915
      be able to help in some way, but it is generally acknowledged that it is very difficult to put down sufficient to buy a new house without selling the old one.
      It has become increasingly difficult in recent months to sell houses. It can happen that many months go by, with the old house still on the market and the interest on the bridging loan having to be paid—which, in itself, creates difficulty. If the house is not sold within a year, I am given to understand that capital gains tax can be levied on the proceeds from the old house.
      This is a rather new problem, because it has not always been so difficult to sell houses as it is now, and it may be that with more money being made available for mortgages through local authorities some part of this difficulty may melt away.
      It is important, however, to recognise that this problem is causing great concern. I do not say that the majority of houses take more than a year to sell, but I do say that many houses take as long or even longer to sell. If it is a clear case of a move from one family home to another I do not think that the proceeds of the sale of the old house can be called a capital gain, because that money is already earmarked to pay for the bridging loan and to settle many other debts that have been outstanding.
      I urge the Minister to give some thought to this matter. I do not ask for help for people who can well afford to buy a new house and not sell the old, but in many cases this is not what is happening. I should he most grateful if the right hon. Gentleman would see whether some relief was possible.
      7.58 p.m.
      Mr. Tom Driberg: I congratulate the hon. Lady the Member for Birmingham, Edgbaston (Mrs. Knight) at least on the brevity of her speech. Mr. Speaker has reminded us that there have been one or two very long speeches. The hon. Member for Birmingham, Ladywood (Mr. Lawler) certainly knows a great deal about his subject, and told us most of what he knows. His speech ran for 33 minutes. I shall not follow his example, but rather that of the hon. Lady. I will be very brief, because I want to make one point only.
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      I want to record and register some of the burning indignation that is felt by many of my constituents and by thousands of other people who are tenants of the Greater London Council at the current policy of the Tory-controlled G.L.C. a policy of deliberate, vindictive, political mass evictions. The G.L.C. has up its sleeve hundreds, perhaps thousands, more evictions without any reason at all being given, and this is what is enraging the tenants most of all.
      Many of my own tenants have said to me of the rent increases that the G.L.C. has imposed, "Well, we did not like it, but we are prepared to pay if the courts say it is right—if they think that it is fair and legal and valid." But the G.L.C. is, of course, dodging the legality and jumping the gun on the courts by taking action under Section 5 of the 1968 Rent Act. Some mention has been made just now of the beneficial effects of amending legislation. An amendment that is urgently needed is one to delete Section 5 of the 1968 Rent Act, and thus extend to council tenants that security of tenure already enjoyed by the tenants of private landlords.
      Although this is, in fact, the policy of the party to which my right hon. Friend the Minister and I belong, and it is the policy of the National Executive of that party and of the conference of that party, of whose decisions he and I alike are custodians, none the less this extension of security of tenure is not acceptable to all my hon. Friends. This is because in the old days it was quite rightly thought necessary to protect the tenants of private landlords, but because local authorities were not bodies which made profit out of letting houses and no consideration of private profit could arise, it was thought that they would behave responsibly and that it was not necessary for their tenants to have this protection.
      Everyone knows that there must occasionally be an eviction, for there are thoroughly bad tenants who, regrettably from a family point of view, have to be evicted, but no one ever conceived that a great public authority like the G.L.C. would behave, not in a responsible way at all but in a totally irresponsible and vindictive way, pursuing a policy of mass evictions of tenants which it does not

      917
      happen to like without giving any reason for doing so.
      I suggest to my right hon. Friend and the Government that the extension of security of tenure to council tenants urgently is the only way of dealing with this real abuse of legal processes going on at present by this great public authority.
      An eviction, as the hon. Member for Ladywood said, is a tragic event from the point of view of family life. I cannot remember his exact words, but he referred to what happens to families who are evicted. On the estates of Greater London Council hundreds and thousands of families are now, or will shortly be, facing eviction—thoroughly decent tenants, not the bad, disreputable tenants who occasionally have to be evicted. This is a most terrible tragedy for London, or for any on the estates of the G.L.C. Eviction is family massacre. I hope very much that my right hon. Friend will take some action urgently to prevent the G.L.C. carrying out this form of, so to speak, local genocide.
      8.4 p.m.
      Mrs. Winifred Ewing: In my constituency there are three towns and many villages. The three towns are Hamilton, Blantyre and Larkhall. Like all towns in Scotland they each have a housing problem. While the problem is not so bad as it is in Glasgow, it is, nevertheless, bad when many people are on the waiting list for houses for seven years although for some there is a shorter period. In each case much has been done. One is aware of this on any visit to my constituency, but one must look at a pathetic plight of one of these towns, Blantyre.
      Blantyre bears a resemblance to a wild west town seen in a western film. The main street is derelict and the shops are falling to bits. That is because there is a development plan in the offing, but Lanarkshire is a big county with a huge population and each area has to wait its turn. I-low that turn is fixed is a puzzle to me. Blantyre's turn will come and undoubtedly eventually we shall have a wonderful Blantyre, because the plan is magnificent, but in the meantime there is very little hope for those who live in the present situation. They know that there is a plan, but they have stopped
      918
      thinking that it will come within an enjoyable period of their lives.
      I express the fear that the cut-back will delay Blantyre's turn to coming into the development plan. I am pleased to learn that we are a little nearer to the top of the list because the plans are now with the Secretary of State for Scotland. This has a direct effect on industry and jobs in my area. Hundreds of jobs are being lost. Is it because employers of labour or middle management feel discouraged about going to a site in Blantyre? Amenities can affect the prospect of keeping employment and of getting new employment which is so badly needed.
      I ask the Minister to consider some of the problems which I call a Member of Parliament's heartbreak. Constituents come to us with housing problems which are properly a matter for their councillors to deal with. It is very hard to explain to constituents that these matters should be dealt with by their councillors. One cannot help noticing that the system of allocation of houses varies so much from one part of Scotland to another as to require it being looked at by the central Government. The Secretary of State has sent a directive to local authorities recommending sensible systems of allocation but these vary. People on the waiting list who are homeless do not understand and they do not get open access to the facts to help them to understand.
      I ask the Minister if this can be done by stronger recommendations without requiring legislation to find some way of enabling on every person on the list to discover why he is at that point on the list and if he feels he is unfairly treated. If men and women on the list feel that they are justly treated it is surprising how feelings of injustice can be dispelled after a proper explanation.
      As a Member of Parliament I assure the House I cannot get explanations in many cases from the County of Lanark. I receive letters from the county council saying that this is none of my business. In a way that is right, but it seems a strange state of affairs and I am not the only Member of Parliament for Lanarkshire who has expressed this view. The hon. Member for Bothwell (Mr. James Hamilton) has expressed a similar view.

      919
      We should consider giving the homeless the courtesy of full explanation about where they stand on the list.
      Secondly, could we not reconsider whether it is reasonable in dealing with people on the list to say if they refuse once they are put down the list. That seems to be a terrible situation. In Glasgow, I understand that an applicant is given three refusals. In my constituency, if a person refuses a house he often goes down the list unless it can be shown that a number of people refused the house in question. I am happy to say that Hamilton Burgh is publishing a book for people on the list setting out the rules but that does not help people in other parts of Lanarkshire.
      I am pleased to see present the Minister of State because I was afraid that we might get through this debate without the Scottish Office being represented on the Government Front Bench ; and this subject of housing is very important to Scotland.
      The Joint Under-Secretary of State for Scotland (Mr. Norman Buchan): I am not the Minister of State, but the Under-Secretary, and I try to attend every possible housing debate if I can. I hope that the hon. Lady does the same.
      Mrs. Ewing: I accept that the Minister does try and is a very conscientious Member. Whatever the arrangements made, throughout most of today's debate there has not been a representative of the Scottish Office on the Front Bench. That seems a very strange state of affairs. While I am on the subject, I must say that I am glad to see that there are now five Scottish Labour Members present. Throughout most of the debate we have had only two present.
      Several Hon. Members rose—
      Mrs. Ewing: I will not give way.
      Mr. William Hamilton: The hon. Lady dare not. She knows what is coming.
      Mrs. Ewing: I will answer that point.
      With regard to the housing debate in the Scottish Grand Committee, I have the apology of the Clerk for not giving me notice of the Committee meeting on that occasion. I have a letter of apology here, because I anticipated that I would
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      be in a vulnerable position and that this would be raised. It is now the subject of a Conservative Party Central Office hand-out. I am interested to note that there is not one Conservative Scottish Member here now, although the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) has been here for most of the debate.
      The Scottish housing situation amounts to a national emergency and we must have very drastic measures to deal with it. It is a question of money and it is not the time for a cut-back. Where do we get the money? Money bears interest and interest rates are high. We have heard that they are higher in other countries, but there is a question of priorities here. A place like Glasgow can never hope to solve its housing problem under the present financial arrangements, when a huge proportion of the rates has to go on interest charges. Interest charges are still at the heart of the problem.
      We must treat this as a national emergency. As we have seen fit to write off the debt of London Transport amounting to £250 million, we must do the same here. It is surely a higher priority. Housing is particularly bad in Glasgow and other parts of Lanarkshire. The right hon. Member for Belper (Mr. George Brown) visited Glasgow during the by-election and endeared himself to the people there by his frankness in admitting that he had not appreciated the extent of the problem.
      As he looked at the horrific situation in parts of the Gorbals he said that there must have been some time-wasting on the way. I am not blaming the Government or the Opposition individually. I am blaming them together, over the years, for not making this a higher priority. It is not possible to solve this problem under the present financial arrangements. I have in mind the Cullingworth Report. The Government do not basically disagree with it when it says that the number of slums we have will not be eradicated by 1992, even at the increased rate of the present Government as compared with the rates of the Conservative Government. The Government have a higher rate and have built more houses while not achieving their target—I am speaking about Scotland—but they are not building to the correct

      921
      target. I am all for having a good target but, accepting the target of this Government, Cullingworth made this serious point.
      How are we to solve this emergency if we do not treat it as such? If we can find money to write off the debt of London Transport let us do the same for the Scottish housing problem which is a national and international disgrace. It is not enough for the Government to compare their statistics with those of the Opposition, because they are the first to admit that the Opposition did not do well. Let us rather ask the Government to compare with the rates of building in other countries. If anyone should bring up the old chestnut about Scotland having more than her share, let me repeat that in these statistics there is no allowance made for the tax relief on mortgages, when approximately a similar amount is spent. What we need with our backlog is a larger slice of public expenditure.
      8.15 p.m.
      Mr. W. Howie: I will not attempt to pursue the hon. Member for Hamilton (Mrs. Ewing) through the streets of Blantyre or anywhere else, because I am not sufficiently acquainted with that part of the world. It is some time since I was last there, but I am sure that it is a delightful area. It is nice to have her present for one of our debates, because this is by no means an everyday occurrence. I know that she is very busy, like many of us, but her attendances are sufficiently infrequent to be noticeable.
      Mrs. Ewing: On a point of order, Mr. Deputy Speaker. My attendances are three full days a week, very often four.
      Mr, Deputy Speaker (Mr. Sydney Irving): Order. The hon. Lady must not use a point of order to enter into debate.
      Mr. Howie: I am sure that the hon. Lady believes that. I merely say that we do not often see her during our debates. I will give her credit for the fact that she spoke yesterday and has spoken again today. I hope that she will be able to speak as frequently in the future.
      At the risk of irritating my hon. Friends, I want to remind the House of the speech made by the hon. Member for Birmingham, Ladywood (Mr. Lawler).
      922
      I am sorry that he has now left the Chamber : he was here a moment ago. It was a very long and not very enjoyable speech, and it plunged the Liberal Chief Whip into a condition of unrelieved gloom, especially at the part where the hon. Member admitted that he was not speaking as a spokesman for the Liberal Party but merely for himself.
      There were two points in his speech which seemed worthy of some kind of note. First he suggested that we should lower building standards. In general terms I do not regard that as a terribly good idea. He referred to the widespread practice of building houses with central heating and of the practice of local councils of adding central heating to existing houses. He should reflect that new houses being built now will last for 40 or 50 years, if not more. He should think ahead. If he builds a house without central heating he is building one that is not only inadequate but which will be totally sub-standard well within the 40 or 50 years. In 40 years from now the house without central heating will be not only a slum but a kind of mediaeval curio. Another point in the hon. Gentleman's speech which requires amplification—though not today—was his statement, if I understood him correctly, that the Government had been refusing loan sanction to some local authorities to buy land for housing purposes. I believe that this is not so. If it is, I should like the hon. Gentleman to take some occasion later in his parliamentary career to list the local authorities which have been refused loan sanction to buy land for housing.
      Mr. Denis Howell: The Government are not refusing any loan sanctions to local authorities to buy land for housing. If that is what the hon. Member for Birmingham, Ladywood (Mr. Lawler) said, he was inaccurate in his assertion.
      Mr. Lawler: Both the Minister of State and the hon. Member for Luton (Mr. Howie) should read exactly what I said before attempting to repeat what I said.
      Mr. Howie: I thought I was very careful in the reference I made. Unfortunately, I can hardly read the hon. Gentleman's speech before it is published in HANSARD, which will not be until after the debate is finished.

      923
      The housing situation is disappointing. I should feel happier about saying that if it were not for the general churlishness of some of the contributions made by hon. Members opposite ; because the housing situation is disappointing in relation to the Government's performance up to now rather than in relation to the performance of the Tory Government. This Government's housing performance has been much better than that of the Tory Government. Although I do not like this kind of tit for tat debate, it is as well to bear that thought in mind.
      I was particularly impressed by the contribution of the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor), who has been the only hon. Member opposite to approach the debate with a concern for housing rather than with a concern for trying to make political points. The Government's performance is much better than the Opposition are prepared to allow, though there no doubt are deficiencies in it.
      References have been made to the somewhat ambiguous statement of the hon. Member for Worcester (Mr. Peter Walker). Perhaps the hon. Member, like the hon. Member for Ladywood, was misunderstood. The statement attributed by the Sun to the hon. Member for Worcester reflects the attitude which has been adopted by many local authorities. I illustrate this by taking the case of the local authority that I know best—Luton.
      Luton Corporation has taken an ambivalent attitude towards the building of borough council houses, an attitude not unlike that which we have understood to be the opinion and advice of the hon. Member for Worcester. The Conservatives came to power in Luton in 1967. I do not object to that. The electors are perfectly entitled to make what mistakes they like. Since taking control in the spring of 1967 up till this summer, the Tory-controlled Luton council let no contracts of any kind for housing.
      Even then, the recent contract, which I greatly welcome, was let only after the council had announced the ideological decision to cease in about two years building for general need and also to sell off to private enterprise some land situated at Marsh Farm, in the constituency of my hon. Friend the Member for Bedfordshire, South (Mr. Gwilym
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      Roberts), which had been bought for council housing.
      My hon. Friend the Member for Paddington, North (Mr. Latham) referred to this question in his interesting and perceptive speech. The decision of Luton Corporation was based on the belief that home ownership is preferable to council tenancy and that private enterprise is the correct machinery through which to provide housing ; and this despite the fact that Luton's housing list stands at about 2,800. The population of Luton increases by 2,000 to 2,500 each year, which suggests that the housing list will be a problem for a considerable time.
      More than that, to make this ideological decision to sell land to private enterprise more likely to succeed the council intends to put land out to tender, with roads built on it, and with services provided ; that is to provide a direct subsidy to home owners, or to intending home owners. I do not particularly object, but I would like the council to admit that it is willing to subsidise or intending to subsidise home ownership.
      Then the council goes on to say that it wishes home owners to be largely drawn from the housing list—a sensible enough comment—but without having made any attempt to measure the demand on the housing list for new homes. Not only that. The council has argued, in trying to draw increased mortgage finance from the Government, that the demand for ownership among people on the housing list is for old houses, and the reason for that, according to the council, is that people on the housing list can afford to buy only older houses, of which there are a great many in the older towns such as Luton. I do not know how the council intends to square its policy of building on Marsh Farm houses for people on the housing list with its assertion that people on the housing list can afford to buy only old houses, unless the council has devised a method of building old houses on Marsh Farm—if it can do that!
      Another example of the policies which arise from the attitude of the hon. Member for Worcester comes in his attitude towards council rents. The council there has devised a strategy of moving towards something it calls a fair market rent. I am not quite sure what that really is,

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      apart from having a suspicion that it is higher than the present rent, and quite a bit higher at that. The council has approached its fair market rent by two devices that are quite interesting. I am not sure how many other councils are using these kinds of devices to force rents up.
      The first is by inflating the housing estimates. Quickly I mention merely one example of inflation. The rent increase of last year was partly due to interest rates —not only due to that, although interest rates played a very important part—but was partly justified by the council's desire to bring in a rent rebate scheme which was expected to cost £26,000, and rents were suggested which would cover the entire £26,000. In fact, at the end of the year the actual amount of money which was required was £13,000, although the tenants paid £26,000. In this year's estimates the council argued that it should have a better rent rebate scheme and that the estimates should be increased from £26,000 to £32,000 and that the rents should be increased further to pay for that increase ; although the tenants had already paid last year's rent rebate twice over they were to pay for it rather more this year.
      The other device, apart from inflating the estimates, which the council used, is a very interesting one. It is this. If we calculate to expect a deficit over the full 12-months' period, then increase our rents six months after the beginning of the 12-months' period, and increase them to the level which will provide sufficient revenue to meet the total deficit, what we then do is increase the rents by twice as much as we would require. Were we to increase the rents at the beginning of the 12 months, in total the sum paid would be the same. But this device has the effect of putting up the rent level twice as rapidly as we would do if we were to meet the deficit for 12 months by paying the increased rents over 12 months.
      I am pleased that, although the council had been very lax for a considerable time in letting contracts, it has now improved, and its housing programme is much better than it was a month or two ago. The housing chairman recently met the Minister to discuss the programme and the whole problem of building in this area, and I am glad to say that the Minister told him that if he wanted to build
      926
      more houses he could do so. In the face of Opposition criticism of the Government's building programme, here we have one example of the Government not holding back the borough council but telling it to get on and build as many houses as possible. I want to see the borough council taking this up—
      Mr. William Hannan (Glasgow, Mary-hill): That is a factor in Hamilton, too.
      Mr. Howie: It may be, but I do not want to go into that ; it is a long time since I was in Hamilton, or in Blantyre.
      With regard to home loans, I pay tribute to the Luton Borough Council, which has a good record, regardless of control. The council is eager to lend money to people who wish to buy their own homes, and I support the council in this.
      The option mortgage scheme is an extremely interesting idea, and everyone will welcome the increase in funds which is shortly to be made. In speaking of the option mortgage scheme, we must turn our minds to the subsidy which the owner-occupier receives through tax rebate. It is a quite defensible idea, but it suffers from the weakness that the more money a person borrows on a mortgage, the bigger house he buys, the more tax relief he receives. The better off a person is, the more tax relief, the more subsidy, he receives. It is a subsidy which is stood on its head ; the less a person needs the more he gets. In addition to widening the option mortgage for poorer people, the Government would be well advised to put a ceiling on tax relief on mortgages. There is a difference between borrowing £2,000 or £3,000 and borrowing £20,000, and I do not think that borrowing £20,000 should be subsidised through the tax relief system.
      My hon. Friend the Member for Liverpool, Walton (Mr. Helfer) mentioned the proposed legislation for dealing with self-employment in the building industry. He knows the house building end of the business much better than I do ; I know the "big hole in the ground filled with concrete" end of the business ; and the problems are much the same. I gently say to the Government that the selective employment tax, which is an excellent tax in almost all ways, has the effect of increasing the enthusiasm with which a

      927
      certain class of person becomes self-employed. In the preparation of legislation to deal with the self-employed the Government should take a minor look at selective employment tax as it applies to the construction industry.
      I end by saying that the Government's total performance in housing is very much better than that of the Opposition, and certainly very much better than the churlishness of the Opposition would lead us to believe. Housing must return to being the number one prioity of a Labour Government. It is the most important single problem facing ordinary people, and the strongest possible Government action is required to try to solve it.
      8.35 p.m.
      Mr. James Allason: The hon. Member for Luton (Mr. Howie) could have been much fiercer on his own Front Bench. He hinted that for reasons of party politics he would find it embarrassing to attack his Front Bench at the same time as the Opposition were attacking it.
      It is extraordinary that in this tragic debate, when the Minister has announced that the housing programme this year will provide for only 365,000 houses, and that next year the figure will be roughly the same, there has been hardly a whisper of protest from the benches opposite. They should have risen in their wrath and told the Minister what they thought of this tragic situation.
      The base figure on which one ought to be working is the figure in 1964, when 373,000 houses were built. The Government have managed to get as high as 40,000 above that figure, and all credit to them, but they ought to have gone on from that. Instead, in this year they have dropped by 48,000.
      Let us remember that the Labour Party pledge was a 33 per cent. increase on 373,000 houses, whereas there has been no increase at all. This is the bonfire of Labour promises which we are seeing tonight. There is no doubt that there is a vital need for more houses. We only need to call in aid the Shelter report, on which so many hon. Members have spoken so passionately. They, like me, have for many years felt strongly about the appalling housing conditions in the country, and yet we have been fobbed
      928
      off with this announcement by the Minister.
      Has this happened because wicked Tory councils are not building council houses? I suggest that one reason for the reduction of 33,000 houses in the first nine months of this year as compared with last year is the fact that 24,000 of those houses are private dwellings. That is where the real reduction is being felt. Although it has been said by hon. Members opposite to be an ideological objection, it is true that every hindrance has been put in the way of private housing. I believe that any house which is built is a house to be occupied. It will house one more family and will be of benefit to the country and should be encouraged.
      Many difficulties face those who wish to become house owners. In 1964, the average cost of a house for private occupation was £3,470. The figure has now risen to £4,782, an increase of 38 per cent. On top of that, mortgage charges have risen from 6 per cent. in 1964 to 8t per cent. this year, representing an increase of 42 per cent. If one piles that 42 per cent. increase on top of the 38 per cent. increase, there is not just an 80 per cent. increase but a 98 per cent. increase.
      This is the measure of the increased cost of buying a house today as opposed to the situation in 1964. I give credit to the Government that as a result of higher taxes the tax relief is greater and there is a measure of improvement in that respect. I do not know whether they are proud of that measure of improvement.
      I spoke today to the vice-chairman of a housing committee in an urban district council in my constituency and he gave me some alarming figures. He told me that 25 houses are being built for occupation next year, the average cost of each house being £4,800. The loan charge plus the management repairs on those houses will work out at £450 a year, with a subsidy of £170. It will be necessary to charge a rent of £5 10s. a week for those houses. This is typical of the situation in many parts of the country.
      What do the Government expect of housing authorities in such cases? Are they to charge the extra to their other tenants? At the moment, no increase

      929
      above 7s. 6d. was allowed. It would be interesting to hear the Government's view of what is to happen next year when the present controls expire.
      If authorities are not to charge their other tenants, they will be in an equally difficult position through having to bear very high interest rates. Do the Government intend to create a situation where a very substantial charge is made on local rates with a view to bringing down the cost of housing?
      It may be that the Government want to discourage local authorities from building. The authority in my constituency to which I have referred fears that it will not be able to fill its houses if it has to charge rents of £5 10s. a week and that it will become ridiculous to continue building, in which case the Minister will be winding up his own building programme in the public sector.
      Mr. Buchanan: Is that £5 10s. a week inclusive of rates?
      Mr. Allason: No, it is exclusive of rates. It is a matter purely of meeting the loan charges. The hon. Gentleman will notice that the 4 per cent. does not meet 50 per cent, of the loan charges. The reason is that the loan charges met by the Government are not the total loan charges on council houses. There are other items of expenditure which are not covered by the subsidy.
      I turn to council house sales. The Minister had nothing to say on the subject, though we used to hear a great deal from his predecessor about nis policy on council house sales. What does the right hon. Gentleman want a council to do where it has a tenant with a substantial income? The right hon. Gentleman's predecessor faced up to the problem. The present Minister has failed to do so.
      Is he content that a tenant who has a high income shall remain in a council house—
      Mrs. Renee Short: Will the hon. Gentleman give way?
      Mr. Allason: No. I have undertaken to speak for only a short time, and I am keeping a close watch on the clock.
      Should such a council try and induce its tenants to move and make way for someone else, or should it sell its tenant
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      his council house? We are entitled to know what the Government's policy is.
      The picture is quite different in the new towns. In 1966, the new town corporations said that they wanted to sell their houses to their tenants. However, nothing more was done about it. But letters are now going out asking tenants whether they are interested in buying. However, those tenants will quickly discover that the prices that they are expected to pay are the current market prices, with no allowance being made for their amortisation of the cost of those houses, possibly over 10 years. Again, it is frequently suggested that such a tenant might wish to move to another house which is being offered for sale, when he would prefer to remain in his present house.
      The Government have a shameful record on housing. This year, 365,000 houses have been built. It may be that 365,000 will be built next year, though I doubt it. There is a clear need for 500,000 houses, for that was the Government's pledge. As a result, 250,000 families will be deprived of houses in these two years. That is quite disgraceful.
      8.45 p.m.
      Mr. Ted Fletcher: I do not wish to follow the hon. Member for Hemel Hempstead (Mr. Allason) except to say that he is quite wrong in suggesting that many hon. Members on this side have not expressed their disappointment at the reduction in the high level of house building that has obtained since the Labour Party came to power. We are disappointed. But it is hypocritical for the hon. Gentleman to suggest that we should reach greater targets than the Tories did in their 13 years in office.
      We must face the fact that since this Government have been in power we have been advised by the Minister that this month two million houses will have been completed, which in all, comparing the previous five years of Tory Government, gives an increase of 441,000 houses —nearly half a million extra houses.
      Mr. Allason: Will the hon. Gentleman compare this with education where we always take the difference between the parties over five years? In house building the Tories increased by 25 per cent. over the last five years that they were in power. Now we have a nil net increase

      931
      between the last year of the Tory Government and 1969.
      Mr. Fletcher: The hon. Gentleman cannot have the statistics in his own way. We had a repudiation of statistics on our economic position yesterday. Someone was accused of cooking the books. Now we are told that we are cooking the books once again. But we are not dealing with balance of payments problems that are done by accountants ; we are dealing with physical assets—houses.
      We need only go round the local authorities to find out where these extra 441,000 houses are. They have been built over and above the target of the previous five years of the Tory Government. Therefore, it is hypocritical for hon. Members opposite to suggest that the Government are not doing as well as the Tories did previously. They have done exceptionally better.
      But it is disappointing that the figure is beginning to tail off. We must ask what contribution Tory-controlled local authorities are making to this slackening off of housing demand so far as it concerns local authorities. I know from my experience in Darlington that the Tories have reduced their housing from 500 to 250. In the locality of Sunderland they have reduced their housing from, I believe, 900 to about 90. The Tees-side authority has drastically slashed its housing target. This is happening at a time when we are crying out for industry to come to the North where we have regional problems of unemployment twice the national average and where it is estimated that 10,000 people are leaving Northumberland and Durham every year to migrate to the prosperous Midlands and the South.
      I understand the tremendous housing problems with which London is confronted. But part of the solution to London's overcrowding lies in Middlesbrough, Sunderland, Newcastle and Darlington. These are the regions which, with a good expansive policy of house building, could attract new industries into a better environment than that left to us from the 19th century.
      The provision of decent housing for the whole population is as much a social as an economic problem. The existence
      932
      of over 2 million substandard houses is possibly the cause of more individual misery and unhappiness than any single factor that affects our community.
      We have problems arising from bad housing : juvenile delinquency, vandalism, a growth of apathy and under-privileged groups of people. So more must be done, and I urge this on the Government, to increase our stock of houses. The Government have a lot to boast about. They have a lot to tell the electors. But they still have some way to go to make up the leeway. Britain spends 3-5 per cent. of her national gross product on housing. France 6-3 per cent., and Italy 6-2 per cent. Italy spends twice as much on housing as on defence ; we spend half as much. We must get our priorities right. We must realise that housing is probably the most vital sector of our economy in which underprivilege exists. As a consequence we need to do much more than we have been doing to increase the stock of houses.
      Mr. Heller: These comparisons with foreign countries should be examined closely. I must point out that both Italy and France did absolutely nothing for almost 10 years immediately following the war, and are only now catching up with our position. Furthermore, they have spent a great deal of money on houses for the rich rather than for the poor.
      Mr. Fletcher: I am not attempting to analyse these figures in depth. I know that in these countries as a consequence of the war there was a lag in house building and that in recent years much capital has been devoted to it. I am merely giving the facts as they exist at the moment. These countries are spending twice as much as we are on housing. That cannot be refuted.
      Hon. Members opposite who criticise the Government's record should be talking to their Conservative members of local authorities. They are the people who are dragging their feet in respect of rehousing. There seems to be an ideological campaign against the building of council houses. A lot of hoary myths seem to be circulating among members of the Tory Party to the effect that council house tenants are being subsidised at the expense of the rest of the ratepayers. That is not true. In reply to a Question

      933
      the Minister of Housing and Local Government pointed out that, on average, owner-occupiers receive over £4 per year more in subsidies through tax relief than do the council tenants.
      In many cases council tenants are helping to purchase property which remains in the ownership of local authorities. I spent many years as a member of a local authority, and I know of tenants who have been living in council houses built after the First World War and have paid for them two and three times over and still do not own them. In years to come local authorities will own a stock of houses paid for, in the main, by the tenants of those houses and belonging to the community, thereby representing a great asset to it.
      We must also recognise that council houses generally go to those with low incomes. Hon Members opposite refer to isolated cases of people earning £40 or £50 a week, and say that they are a charge on the rates and should be made to vacate their houses. These people are very few and far between. There is a cycle in the lifetime of the average workingclass family. Members of the family get married and have their own families. They may suffer considerable hardship in bringing them up. Then, for a short period, the children, when they reach the age of 14, 15 or 16, go out to work and start bringing in an income. At a certain period there may be three or four incomes going into a council house, but when the children become 20 or 21 they get engaged and married and find homes of their own. So we are left with the tenant and his wife and one wage. Those Tory councils which are cutting back on council house building are striking a blow at a section of society which badly needs rehousing.
      One remarkable thing that has emerged from the debate is the statement made by the hon. Member for Birmingham, Ladywood (Mr. Lawler), the Liberal Party spokesman on housing, so we read in the Press. I am sorry that he is not here now. He said that standards of housing were too high. This is a remarkable statement, although he denied that he was speaking for the Liberal Party. I hope that his party will repudiate this statement. If we build houses of a lower standard we shall have the same situation as we had in the 1930s
      934
      when it was possible to buy a sub-standard house, if they could be called that, for £25 down. These houses were jerrybuilt by speculative builders and are the slums of the 'seventies and 'eighties. If we build sub-standard houses our children will have to deal with them as their slums.
      The Liberal Party has repudiated the hon. Member on the question of immigration, and I hope that his colleagues will tell him that this is not their policy but that we want to build houses that are a credit to the community and will breed good citizens. I hope that at an early opportunity the Liberal Leader will make a statement to the House on his party's policy.
      Local authorities have a statutory obligation to balance their housing revenue accounts, but lots of them work out the balance on the basis of the deficit of the account and then send out notices for rent increases. The housing revenue accounts of many authorities carry a lot of charges which should not be placed upon the shoulders of council house tenants. Some authorities acquire building land for development and it is put as a charge into the housing revenue account. Others demolish property for road widening purposes and the tenants have to be rehoused. This is another charge on the account. Sometimes landscaping takes place, to the benefit of the whole community, but is made a charge on the account.
      I urge my right hon. Friend to give guidance to the local authorities on what is a proper or improper charge on the housing revenue account. I am convinced that many exaggerated rent increases that have been held to a ceiling of 7s. 6d. by the Government are the result of bad accountancy in the housing revenue account. The Government have done a good job with housing and are to be congratulated. But I think that many on this side will agree that they could do better. So we have nothing to fear from the Tories' attack on the Government. We are proud of their record, but I am convinced that we can do even better. I hope that the Government will do better in the years of power which lie ahead.
      Mr. A. P. Costain rose—
      9.0 p.m.
      Mr. Reginald Maudling: This is a debate of great interest to both sides of the House and I know that many hon. Members have been disappointed in not being able to take part. In particular, I know that my hon. Friend the Member for Folkestone and Hythe (Mr. Costain) has sat here all day hoping to get in. It is a measure of the importance of the problem that so many hon. Members have wanted to speak—and a measure also of the Government's failure.
      In this debate on the Address, we have had the benefit of a maiden speech from the hon. Member for Paddington, North (Mr. Latham), which we heard with great interest. He was not the coyest of maidens, nor the most noncontroversial, but, certainly, all who heard his speech, as I had the pleasure of doing, will look forward very much to hearing him again in future.
      Traditionally, at the end of the debate on the Address, winding-up speeches from the Leader of the House and from this side deal partly with an Amendment such as we have been discussing today and partly with the generality of the debate over the last few days. I hope to do that tonight, and I hope that the Leader of the House will be kind enough to cover both the problems of housing which have been discussed, including the questions to which his right hon. Friend gave no answer, and also some of the general questions which have arisen during our debates.
      Today's reply by the Minister of Housing was a very sad performance. He had no answer whatever to my hon. Friend's many and detailed criticisms, which were immensely effective. One example is local authority mortgage loans. Here, the Minister had something to say, the only point on which he did have something to say. They are to provide some more finance for this purpose and in future £100 million will be available, as against £175 million when they came into office. That is the extent of their achievement.
      But the Minister said not a word about the price of houses, which have risen on average from £3,500 to over £4,700—an enormous increase in a short time, to which the Government them-
      936
      selves have made no small contribution, particularly, of course, through the selective employment tax—as both the hon. Member for Liverpool, Walton (Mr. Heller), who knows these things very well, and the hon. Member for Luton (Mr. Howie), have stressed. What have the Minister and the Government to say about the increase in house prices and the increase in the cost of money to buy a house, which result from their own policies? We have heard not a word about those things.
      Nor can I recall much being said about the price of land or the Land Commission. Was it not going to make land cheaper? Has it made land cheaper? What does the Minister of Housing or the Leader of the House say? Is there any evidence to refute what my hon. Friend said—that the Land Commission so far has merely succeeded in raising the price of land, at considerable cost to many elderly and modest people who cannot afford the charges imposed upon them? There has been no answer to that.
      And what about mortgage rates, which are a major factor in the housing situation? They affect the whole range of people—owner-occupiers, for instance. Not merely people buying their houses, but those living in their houses and paying for them over a long period, are intimately affected and deeply disappointed by the Government's total failure to live up to their promises at previous elections. Mortgage rates affect the average industrial wage earner. Under Conservative rule he could expect to buy his own house, but under Labour he can no longer have any chance of doing so.
      Mortgage interest rates have a great effect on council housing accounts. The Government say, "When it comes to building new houses, local authorities have a cushion provided to keep their effective interest rates down to 4 per cent.-. But that does not provide for the enormous burden imposed on local authorities and their housing accounts generally by the high interest rates which they must now pay for their money.
      What is the answer? There is a fashionable new answer among Ministers—I am glad that the Chancellor of the Exchequer is in his place—about interest

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      rates. They say, "This is nothing to do with us. It is an international matter. Interest rates go up and down internationally and we cannot insulate our market from what happens in the rest of the world ".
      There is a good deal in this. We cannot segregate our market from the markets of New York or Frankfurt, but, if it be true that interest rates for mortgagors in this country depend not on Governments but on international factors, why did the party opposite promise to bring interest rates down? I would like an answer to that from the Leader of the House, because these facts were known when that promise was made. Why were hon. Gentlemen opposite promising to bring interest rates down if now they are saying that to do so was never within the control of Her Majesty's Government, anyway?
      Of course it was within their control. Indeed, interest rates in this country began climbing long before they started climbing in America, France, Germany, Belgium or Holland. Consider what happened in November, 1964. Recall that strange, hurried and ineffectual increase in Bank Rate, the first time an increase in Bank Rate had thrust money out of Britain instead of bringing it in.
      It was an increase which the then Chancellor hoped would not have an effect on the domestic economy. Consider what happened in October, November and December, 1967, when British interest rates went up to 6 per cent., 61- per cent. and 8 per cent. and led the forward movement of interest rates across the world. The Government cannot filet away with this latest line of theirs. The truth is that interest rates in Britain rose early and fast. They rose because of the total collapse abroad of confidence in the ability of hon. Gentlemen opposite to run the economy.
      We must also consider thet4rget of 500,000 houses, the famous target that appeared in speeches made by the Prime Minister and other hon. Gentlemen opposite. Today, the Minister was sorry about it. He regretted very much that the target had not been reached.
      Mr. Greenwood indicated dissent.
      Mr. Maudling: The right hon. Gentleman did not express regret?
      Mr. Greenwood: I did not mention it at all.
      Mr. Maudling: But the right hon. Gentleman did mention—I am sorry to rub these words in—that it was not a lightly given promise, but a pledge. The pledge was for 500,000 houses and it is no good the right hon. Gentleman saying, "We are very sorry, but because of economic difficulties we could not keep it ". The Prime Minister said most emphatically, "No difficulties will hold us back. This is a categorical pledge ". I have never quite understood the difference between a promise and a pledge. I thought that one should keep them both. Hon. Gentlemen opposite break them both, equally.
      This has been one of the most cynical performances of any Government for a very long time indeed and there is no getting away from it. It is no good quoting the total number of completions. The fact remains that the record of the Government in housing shows that they took over—in housing as in so many other things—a rapidly rising curve of output while we are now seeing a rapidly falling curve.
      Mr. Greenwood indicated dissent.
      Mr. Maudling: The Minister may express, in sedentary fashion, some disbelief, but the output of houses in 1964 was 373,000 and the number of houses under construction was 434,000. Now, after the impetus has been spent, we are seeing completions and starts falling way below the point reached in 1964. So far from increasing the building of houses we now have come, under a Labour Administration, to a point where the impetus behind the house building programme is far less than it was five years ago.
      It is no good, either, blaming the Tory local authorities. This was the Minister's latest gimmick, and we would like to know a little more of its origin. Why this list of 20 local authorities which, I think, by some coincidence, are mainly, if not entirely, Tory? Why did he choose that list, and those local authorities alone? On whose advice was it? Was it official advice? Was it political advice? what about the authorities to whom my hon. Friend the Member for Worcester (Mr. Peter Walker) referred this afternoon, when he gave chapter and verse

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      from these Government documents for a whole range of Socialist local authorities whose performance of housing has, apparently, been abysmal?
      There may be reasons—I do not know. But what I do know is that the Minister has no right whatsoever to try to impute to Tory local authorities a failure which is very evident on the part of Labour local authorities. It was a pretty poor performance by a Minister of the Crown. I therefore hope that the Leader of the House will give us some indication of what the Minister's justification was for selecting this particular band of local authorities for his strictures.
      Everyone knows, of course, that the main difficulty in the way of more house building is the cost of the houses and the cost of financing them the cost falling on local authorities both of the house itself and of the necessary finance that they have to raise—and the difficulty created for the building industry by the credit squeeze, upon which the Chancellor of the Exchequer so definitely still insists. My hon. Friend the Member for Clitheroe (Sir Frank Pearson) referred to the difficulties of the brick industry. Both the building materials and construction industries are clearly held up, more than anything else, by the credit squeeze. This is a major reason for the present lamentable performance in housing.
      What did the Minister have to offer the homeless? Nothing that I can see at all. I think that he was unwise to dismiss too easily the question of redefinition of the homeless. Some ministerial pronouncements in recent months have grated on the ears of many people as sounding rather complacent. There is a need for a major effort to deal with the problem of homelessness and of inadequate housing standards.
      There is a need, obviously and, first of all, to build more houses, particularly in the areas where the problems are greatest ; a need to encourage private provision of accommodation to rent, which is extremely important—not only private enterprise in the traditional sense, but private activities in the sense of the cost rent system referred to by my hon. Friend the Member for Ormskirk (Sir D. Glover).
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      Any support for private activities will help solve the problem of squalor in housing, a great deal of which, as one knows, lies in the private rather than in the public sector, but one still cannot expect to see private enterprise making much of an effort in this direction under a Government who have in the past been openly prejudiced against the private landlord.
      If we are to deal with the problem of the homeless, if we are to make the best use of the housing stock available, there must be a reform of the system of housing subsidies so as to ensure that the aid available from taxpayer and ratepayer is concentrated on those who really need it. This is the attempt of Tory local authorities like, for example, the Greater London Council. It is an attempt that has been sadly impeded by the Government —
      Several Hon. Members rose—
      Mr. Maudling: No—there is safety in numbers. I will not give way at all.
      Several Hon. Members rose—
      Mr. Maudling: I will give way to the hon. Lady, in that case.
      Mrs. Renee Short: Would the right hon. Gentleman explain exactly what he means by families able to afford to buy their houses and who, therefore, do not need subsidies? Will he give the definition because he and his hon. Friend the Member for Hemel Hempstead (Mr. Allason) have been saying that there is a level of family which can afford to buy and to pay higher costs for their houses. Will he define it?
      Mr. Maudling: It is those people who under existing rent rebate schemes do not qualify for a rent rebate. Surely that is a simple proposition.
      Mrs. Short: At what level of income? How much wage? Tell us where the line would be drawn. We want to know.
      Mr. Maudling rose—
      Mr. Driberg rose—
      Mr. Maudling: I am sorry, I cannot give way again.
      Mr. Driberg rose—
      Hon.Members: Sit down!
      Mr. Maudling: I have a large area to cover and I want to turn now to the general debate—
      Mr. Driberg: Dodging.
      Mr. Maudling: —to which as a whole the Leader of the House is to reply this evening.
      The main debate has been largely concerned with the economic problems of the country, as is usual on these occasions. The main theme of the Government has been, first, that we now have a balance of payments surplus, and secondly, that people now have more motor cars and refrigerators than they had five years ago. There has been no real attempt whatever to reply to the charge of broken pledges across the whole range of economic performance.
      There has been no attempt at all to deal with increases in taxation under this Government, either to explain them or to justify them, or to explain the breach of promise they represent. There has been no real answer—apart from the kerfuffle about international difficulties which I have dealt with—to the question of high interest rates. There has been no real answer on the unemployment problem and why it is so different now, as my right hon. Friend the Member for Enfield, West (Mr. lain Macleod) said, from what the Prime Minister predicted. There has been no real answer to the attack on the rapid increase in prices and cost of living under the present Government. There has been no reply throughout the debate to any of these points. I hope that the Leader of the House will attempt to deal with them.
      Despite the Chancellor's speech, there has been no serious attempt to face the problems of flagging investment, which are very serious, the problem of wage inflation building up all the time, and problems of industrial strife, which is such a heavy handicap to our industry at present. The Minister of Technology talked a little about taxation. He tried to minimise the increases in taxation, but he cannot deny that what has happened is totally contrary to the pledge about" no general increase in taxation". He cannot deny that the amount of tax now being collected is twice what it was five years ago. If he says that this is partly due to the enormous inflation in the
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      meanwhile, he can take that point for what it is worth. Nor can he deny that an increase of £3,000 million a year is the increase in the total rate of taxes now being collected in this country.
      The only excuse the Minister could find was that tax as a percentage of national income had risen from 33 per cent. to 40 per cent. If that is all he knows about the meaning of economic statistics, we are in for a very rough time when it comes to running British industry. We have heard little about prices, but prices have been increasing very rapidly in recent years and they look like increasing more in future. What has not been pointed out is how far it has been the deliberate policy of this Government to put up prices. We can take the examples of S.E.T. and devaluation. Neither would work unless prices went up. The whole point of S.E.T. was that the increases in price should be passed on to the consumer. We know the origin of S.E.T. After the election the party opposite could not face an increase in income tax and indirect taxes, so they cooked up this one.
      The purpose was to reduce demand, and that can only be done by putting up prices. When the S.E.T. puts up prices, as it is doing over a very wide range of articles, including food, it is doing so at the deliberate choice of the Government. The same is true of devaluation, which is designed to improve the balance of payments, to reduce imports. We do that only if the prices of imports rise. Therefore, the whole purpose of devaluation, as the Home Secretary recognised in his day, is to reduce the standard of living of the people and to cut down their power to consume.
      I come now to the balance of payments. The Government were entitled to the credit for the very encouraging results which the Chancellor gave us yesterday. It is possible to argue about the high level of world trade generally, and to say that other people are now inflating faster than we are, and that a great part of it is due to the enormous growth in invisible income.
      The Government have done precious little to encourage that. But they are entitled to claim credit for the improvement. They are not entitled to claim that our economic problems are now solved, or that this has been achieved without

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      sacrifice, on the one hand, and broken promises, on the other, or that they have done more than begin, by the painful measures, to extricate the British people from the predicament in which they have landed us.
      The truth is that putting the balance of payments right is only part of the problem. The problem is to get the balance of payments right, but to do it without severe damage to the domestic economy. The Government are making big claims. Let us see what happened in the past. My right hon. and learned Friend the Member for Wirrall (Mr. Selwyn Lloyd), in 1961, reversed an equally difficult balance of payments situation, but he repaid all the money he borrowed abroad within one year, the squeeze was not prolonged and Bank Rate, despite what the Chancellor said yesterday, was reduced to 4½ per cent. by the following May; and he did not need another £3,000 million in taxes, nor did he need to devalue. He did all this in 1961–62.
      We now have serious problems of investment and wage inflation. The Minister of Technology talked about investment as if the only thing that affected companies when they invested was the balance of payments. What affects companies quite apart from that is the prospects on the domestic market and the availability of cash. I can tell the Chancellor from what I know of these things that both these factors will have an increasingly depressing effect upon investment in 1970, not merely the lack of prospects on the domestic market but, possibly even more important, the lack of cash running throughout industry affecting particularly the smaller companies, but the big ones, too. This will mean that they will have to cut back their investment intentions whether they like it or not. The problem of investment is becoming serious.
      Even more important is the problem of the incomes policy. Nothing was said by the Chancellor that I can remember about the problem of wage inflation, but quite a lot was said by the Home Secretary last week. For instance:
      "If because of unjustified wage increases running ahead of our productivity our costs should get out of line with other countries, then our exports will undoubtedly fall and our economic strength will suffer".—[OFFICIAL REPORT, 29th October. 1969; Vol. 790, c. 185.]
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      What does the Chancellor think about the present wage push situation? It is very serious. The incomes policy has collapsed, although in theory there is a nil or 3½ per cent. norm at the maximum. Settlement after settlement is going ahead at 10 per cent., 15 per cent., or more. We must not forget that every 1 per cent. addition in purchasing power represents over £200 million which the Chancellor would otherwise have to take away in his next Budget in taxation. He must be a very worried man about this. The Government, by bringing monopolies and the P.I.B. together, have now belatedly recognised that the whole problem is one of monopoly policy.
      Major social and economic questions arise from the monopoly power of certain trades unions which are in a position to exercise it. Some people—I do not say the leaders of the unions—have been encouraged by the recent success of anarchy in some industrial relations. The television programme on which Lord Robens appeared, for example, showed quite clearly that anarchy and indiscipline have paid off and have had very serious effects indeed.
      When the Government embarked upon a statutory wage policy, we told them that imposing statutory control would undermine the opportunities of voluntary co-operation. We gave them then a very serious warning which has now come home to roost. They sabotaged our efforts. They quite deliberately sabotaged the National Incomes Commission —our effort to get a voluntary policy.
      Now how will they cope with the twin problems in our economy of keeping the total level of incomes in check and ensuring that the lower-paid workers get the increases which we want to see them have without the differentials pushing the whole thing far too rapidly upwards again?
      The Prime Minister said that there would be
      "new legislation … to establish a body to correct abuses of market power."—[OFFICIAL. REPORT, 28th October, 1969; Vol. 790, c. 42.]
      What is market power? A monopoly of capital exercises a market power, but a monopoly of labour exercises an equally strong market power. Do the Government, by this phrase of the Prime Minister's, intend to take powers to deal with the abuse of market power by powerful

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      trade unions? We are entitled to an answer to this question.
      The other subject to which no reference has been made since the beginning of this debate is labour relations. This is one of the most serious problems that Britain is facing. The Prime Minister was at his most remarkable in dealing with this, when he produced all the answers that his Left-wing opponents had been giving him during the course of the summer. We saw the hon. Member for Ebbw Vale (Mr. Michael Foot), for example, nodding in agreement to the prodigal who had returned to the fold. The Prime Minister is quite ineffable. No other man I know could cut the throat of a Bill that he called quite essential and then award himself a good conduct medal for doing it.
      On all these things we have had no answer whatsover in this debate. We are hoping—it is a vain, tenuous hope—that the Leader of the House will deal with them tonight. There is no one from whom we would rather hear an agreeable and convincing speech. We live in hopes.
      To sum up, it was wise for the Opposition to choose housing for our debate today, not only because it is important in itself, but also because it is an excellent example of the policy and the failure of the Government. It is an outstanding example, to which no answer has been given, of specific and solemn promises openly and unashamedly broken. It is an example of performance changing from a rising tide which this Government inherited to the falling performance of the present time. It is an example of an attempt to put the blame upon Tory local authorities for a failure which belongs solely to the Government.
      All this is typical of the Government—promises broken on an unprecedented scale. We know the tactics they are adopting now. We see them in their speeches and in their broadcasts. They are saying, "Of course we have broken a few promises. We did not do this, and we did not do that. But does it really matter?", they imply, "Do not politicians break promises?".
      It does matter. It matters enormously if promises are broken. It matters enormously if Socialist Governments try to impose their will on freely elected local authorities. It matters enormously if
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      the Socialist Government try to gerrymander constituencies to keep themselves in power, because what matters to all of us in this House is the political system within which we operate, and on this count we condemn the Government.
      9.30 p.m.
      The Lord President of the Council and the Leader of the House of Commons (Mr. Fred Peart): The right hon. Gentleman the Member for Barnet (Mr. Maud-ling) has covered a wide canvas and emphasised particular aspects of policy which he felt strongly about, and I will take up some of his points during my speech. He and I have a difficult task in winding up debate on a Motion for an Address in reply to the Queen's Speech. Both of us have to cover a whole series of debates which we have had on the Gracious Speech, and I am certain he agrees with me that it is not an easy task.
      I should like first of all to congratulate the hon. Member for Paddington, North (Mr. Latham), who made his maiden speech so quickly today. It was a good speech and a very controversial one. I would say to him that I wish him well, but that if he makes a controversial speech, inevitably he will have to join in the hurly-burly of debate. I am sure he will represent his constituency well.
      It seems quite a while since we heard the opening speeches of my hon. Friends the Members for Berwick and East Lothian (Mr. Mackintosh) and Wood Green (Mrs. Joyce Butler), the mover and seconder of the Motion before us, but the quality of their contributions was such that they will certainly be remembered by the House for a far longer period than this. I would add my tribute to their enhancement of a distinguished tradition.
      My hon. Friends exemplified the importance of individual Members. Indeed, the right hon. Gentleman talked about our parliamentary system. I think my hon. Friends showed all of us in this House how effective they are, as individual Members, in furthering the causes they believe in so strongly.
      I believe that the influence of backbenchers has been growing over the past few years. For this reason I should like to take up a statement made by the right hon. and learned Gentleman the

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      Member for St. Marylebone (Mr. Hogg), who took part in this debate. He addressed recently a Young Conservatives' conference at Harrogate. I found it extremely interesting that the right hon. Gentleman in his speech said that the next election might well represent the last chance for parliamentary democracy. I would only say that I believe he was carried away by addressing the young faithful in saying this would really represent the last chance for parliamentary democracy. I had hoped that he would have been here this evening. I am afraid that extravagant allegations of this sort carry with them the whiff of a speech made by a still more distinguished Parliamentarian during the 1945 election campaign when he referred to the threat of a coming Gestapo regime. Such wild statements rebound on those who make them.
      I believe that the right hon. and learned Gentleman the Member for St. Marylebone, by his own belief in parliamentary democracy and, indeed, his many constructive speeches in this House, has contributed in no little way to the vigorous parliamentary democracy we now have here. 1 am sorry that he indulges in this extravagant propaganda which later, when he spoke in the debate on the Gracious Speech, he took up in his theme about centralisation and bureaucracy.
      What are the facts? Over the last few years there has been—I would like to say this quickly as Leader of the House and because the House is important—a remarkable resurgence and modernisation of parliamentary institutions and of our procedural framework. I believe that this resurgence and modernisation is—and must keep—continuing. I recognise this to be the fundamental background to the work which faces us in the coming year, and I make no apology, therefore, before turning to some of the contributions made in the debate and to the Gracious Speech itself, for dwelling for a few minutes on this subject.
      One central feature is the balance of power and influence between Parliament and the Executive, and I believe that in the last two or three years there has been a shift of power back towards Parliament. I welcome this. Sometimes this shift has been deliberately planned, sometimes not—[Interruption.]
      Mr. Speaker: Order. Backbenchers must not assert themselves too much.
      Mr. Peart: Indeed, Mr. Speaker, they did during the debate on the Parliament (No. 2) Bill. I regretted this, and I was surprised at the bizarre combination of talent which prevented the passage of the Bill? But, as Leader of the House, and as a profoundly convinced supporter of parliamentary democracy, my regrets were modified by the demonstration that this House is not a mere legislative rubber stamp.
      Turning to the developments more deliberately planned, since 1966 we have greatly extended the opportunities for backbench participation with the new specialist committee experiment. emphasise the word "experiment", and, naturally, there have been troubles here and there, but I believe that this experiment has succeeded. As I have already told the House, the Government are reviewing the results of this experiment, and I intend to bring forward proposals during this Session. In our review we shall naturally pay considerable regard to the radical and thoughtful report of the Committee chaired by my hon. Friend the Member for Birmingham, Northfield (Mr. Chapman), and of the views expressed in the debate on that report.
      I have also noted the suggestions made during the debate on the Address about specialist committees by my hon. Friend the Member for Dewsbury (Mr. Ginsburg) and the lion. Member for Cambridge (Mr. Lane), and I will take them into account during the review.
      I know that many hon. Members are, naturally, impatient at the progress we are making on the Select Committees, but I ask them to remember that we are moving into a new and very important field, and to compare the opportunities for backbench participation which arise with those which existed a few years ago. The comparison is favourable.
      The Report of the Committee on Procedure also covers another area in which the Government have been trying to assist the House, and that is with the provision of information so as to give the House more opportunities for constructive criticism of the Executive.
      The week before last I announced the Government's acceptance of the scheme for a new annual two-day debate on a

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      White Paper setting out the Government's proposals for expenditure projected over a longer period than at present and expressed in a more detailed way. I believe that during the months ahead this will assist the House in exercising its scrutiny in a way more in keeping with the longer-term base on which Government expenditure is now planned.
      This is important. Let us remember that much has been dome recently. Many archaisms have outlived their usefulness. Our time on the Floor is now more effectively used. We have introduced the time-saving procedure of the Second Reading Committee and provision for formal Report stages. We have made better provision for the House to debate quickly important matters of urgency. We have devoted more time to Private Members' Bills. All this in the end shows that progress has been made. I hope soon to present to the House proposals relating to parliamentary privilege, as I have said.
      So I am asking hon. Members to face a Session which will mean considerable hard work. The Gracious Speech announced a full legislative programme, and several of the Bill will be long and complex. The role of this House—and I mention the House because of its important place in legislation—will depend, as always, on the quality of the contributions made by individual hon. Members. For this reason, we recognise that the facilities must be provided to enable hon. Members to do their jobs efficiently.
      I realise that much still remains to be done. But I think I can claim that, with the recent improvements in such matters as hon. Members' telephone and postal facilities and the Government's acceptance in principle—and I hope that it will not be too long before I can put forward detailed proposals to the House—of financial assistance towards secretarial help, the Government are making a real effort, within the inevitable limitations, to provide the essential facilities for hon. Members to meet the ever-growing demands of parliamentary life. When I first became Leader the right hon. Member for Enfield, West (Mr. lain Macleod) chivvied me on this matter, and I hope that he will agree that we have made better arrangements to combine the efficient use of the time of the House with the proper scrutiny of the Govern-
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      ment proposals—for example, in the way in which the Finance Bill is now dealt with in Committee stage.
      Mr. Selwyn Lloyd: The right hon. Gentleman referred to the Report of the Select Committee on Procedure and his acceptance of the idea of a two-day debate. When will he make a decision on the rest of the Report about setting up a Select Committee on Expenditure, and so on?
      Mr. Peart: The right hon. and learned Member for Wirral (Mr. Selwyn Lloyd), who was a member of the Select Committee and took part in the debate in which that report was discussed, knows that when I spoke on this matter at the time I said that we were carefully examining the Select Committee system. I hope to have another debate on the Report of the Select Committee, and the Government will produce a White Paper on the subject of committees. The report will be given careful consideration. I make no apology for mentioning these matters because, in the end, they affect the working of the House and the scrutiny of legislation.
      The right hon. and learned Member for St. Marylebone raised the whole issue of over-centralisation and bureaucracy. The reform of local government, which is a subject that has been discussed during the debate, is important. The Government hope to introduce proposals which will have the effect of strengthening the local government system so that more power can be transferred to it from the centre. Nobody will consider our present system ideal. Obviously there will be much discussion and debate on the Redcliffe-Maud and Wheatley proposals.
      I was interested in many of the points raised by hon. Members on this topic, particularly in the comments of my hon. Friend the Member for Carlisle (Mr. Ron Lewis). He, the right hon. Gentleman the Member for Penrith and The Border (Mr. Whitelaw) and I attended a conference in Cumberland on this matter, and we all know that the arguments about Redcliffe-Maud and Wheatley inevitably cut across party lines. We shall wait for the proposals, but they will mean that we must move forward with local government reform. Similarly the Government's proposals on the Seebohm

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      Committee Report and on the future administration of the National Health Service are designed to strengthen local structures and so encourage local initiative and participation.
      I turn to the Amendment to the Gracious Speech put down by the Opposition. The hon. Member for Worcester (Mr. Peter Walker) quoted a number of figures, many of which were highly selective—[Interniption.]
      Mr. Speaker: Order. The debate has proceeded so far in an orderly fashion. Will hon. Members allow it to continue in that way?
      Mr. Peart: The hon. Member at certain times talked about houses started and at other times referred to houses completed. I will take a specific example quoted by him which affects my own constituency. He managed to give the impression that the Borough of Workington had done nothing about houses in the last two years. I have studied the official figures and have discussed the situation with the town clerk. Let me now give the true facts.
      This is a very small town. In 1968 the borough council put 156 houses out to contract. By the end of September it had placed contracts for a further 50. In 1968 no houses were started. However, in the first nine months of this year it started 204. In 1968 it completed 28. In the first nine months of this year, although it did not complete any, by the end of September it had 204 under construction. The hon. Member for Worcester said that nothing had been done. I ask him to withdraw what he said.
      Mr. Peter Walker: In the Government's housing statistics published this October, the number of council house starts in the 12 months ending June. 1968, was nil. The number in the 12 months ending June, 1969, was nil.
      Mr. Peart: The hon. Gentleman gave an entirely false impression. These figures show—[Interruption.]
      Mr. Speaker: Order. The House ought to hear both sides.
      Mr. Peart: Let us take the figures nationally. In the last five years the number of housing completions has been about a quarter better than it was in
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      the preceding five years. Improvements have been made in both the public and the private sectors. In the private sector 222,000 houses were finished last year, which is the highest total since the war. Between the end of 1964 and the end of 1968 the total number of owner-occupiers in Great Britain went up by almost exactly one million.
      In the public sector, which is important in terms of slum clearance and obsolescence, completions are 40 per cent. higher in the last five years than in the previous five years. I recognise that there is still a lot to do, but I am glad that the party opposite has realised belatedly some of the tragedy of homelessness. But do not let them pretend that they have a better record of dealing with the problem. I never forget Rachmanism in their period of office.
      Let us look at the Gracious Speech and some of the issues there. Let us examine some of the instant opposition displayed from the benches opposite. The Leader of the Opposition said that the Gracious Speech was not relevant to many of our problems. However, in the course of this debate many of his right hon. and hon. Friends have referred frequently to much of the positive legislation which is proposed in the Speech.
      Right hon. and hon. Gentlemen opposite are playing politics, and they know it. They are committed to their" investment in failure", to use the words of my right hon. Friend the Prime Minister. They seem anxious to decry the progress which has been achieved by the people as a whole, who will not take kindly to right hon. and hon. Gentlemen opposite seeking to denigrate the achievements because they cannot bring themselves to accept that there can be economic progress under a Labour Government.
      We have a classic example in the right hon. Member for Altrincham and Sale (Mr. Barber). The Daily Telegraph, which is not sympathetic to the Government, rebuked him yesterday in its main commentary. I believe that the right hon. Gentleman—[Horn. MEMBERS:"Where is the right hon. Gentleman?"] —will regret the speech that he made.
      But we must not—and I say this because this theme came out of the Gracious Speech and the speeches of many hon. Members on both sides—make economic

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      progress an end in itself. It is but the means for an improvement in the quality of life here.
      My hon. Friend the Member for Coventry, North (Mr. Edelman), I thought, made an extremely stimulating and interesting contribution on this point. We must do something about some of the disparities that remain which prevent people from reaching their full potential. We must help those whom circumstances have put at a disadvantage to overcome their disadvantages.
      The Gracious Speech contains a number of proposals on these points—the disparities between those who live in the more favoured and less favoured parts of the country; the disparities between those able to join private pension schemes and those who have to rely on the State; the disparities between those who have the opportunity to get the best education and those who have to make do with second best; the disparities in the pay of men and women; and, lifting up our eyes from our immediate affairs, the disparities between those of us fortunate enough to live in this rich country and the two-thirds of the world who are desperately poor.
      On this last point I am glad that in the Gracious Speech and during the debate there was concentration on overseas aid. I am glad now that even the party opposite is fully committed to this and that it will rebuke the fringe section of the Tory Party that decries aid for the under-developed countries. We should never underestimate not only the direct aid but the other help that we give. For example, the Commonwealth Sugar Agreement has played a great part in strengthening the economies of a number of developing countries. I know that some of this help can never be quantified. For instance, there are the advantages to the primary producers of staple commodities. I believe that the proposal in the Gracious Speech of an international agreement on tariff preferences for the developing countries is another very important form of help.
      So we defend the Gracious Speech.
      I am amazed that not one Opposition Front Bench speaker, and only one backbencher, the hon. Member for Gains-borough (Mr. Kimball), mentioned agriculture. Hon. Members opposite are sup-
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      posed to be the champions of agriculture. We shall have a major Bill on agriculture this week which is highlighted in the Gracious Speech. Is this irrelevant to agriculture? The Bill will provide for marketing improvements and will help to rationalise grants for farmers. There will be improvements in the provisions relating to tied cottages and reorganisation of smallholdings. All these matters are relevant, but not one farmer friend or supposed friend among the Tories mentioned agriculture.
      Do hon. Members opposite consider our proposals for other industries irrelevant? Take merchant shipping. It is a scandal for a seafaring nation that our seamen should still be governed by Victorian legislation. We shall do something about it.
      What about the various proposals for safety, health and welfare? Are they irrelevant? The reforms that we intend proposing on industrial safety and health will be considered relevant by the many millions of workers affected.
      What about improvements in trawler safety? I remember, when I was Minister of Agriculture, Fisheries and Food, that, with my right hon. Friend the then President of the Board of Trade, we set up the Holland-Martin Committee whose report has led to the Government's decision to put legislation before this House. I take pride in this. But I have no real enthusiasm for the party opposite, because it never did anything.
      On the regions, we have on record speeches of the Leader of the Opposition as to what they would do about the development areas.
      Do hon. Members opposite consider the proposed legislation on equal pay to be irrelevant?
      Do hon. Members opposite consider the proposed National Superannuation Scheme to be irrelevant? If so, I hope that they will tell the 12 million workers who are not covered by occupational schemes that they will benefit from something. My right hon. Friend is consulting those who are members of occupational schemes. We must end the present division into two nations on retirement.
      What about drugs? Do hon. Members opposite consider the proposals to make the law more effective to be irrelevant?

      955
      Lastly, I should like to deal with a matter on which I feel passionately—education. Right hon. Gentlemen opposite have stated that they will oppose the Government's Bill on comprehensive education. We take up the challenge because we believe that comprehensive education is the only way in which a democratic society can organise its secondary education. We believe the existence of selection and the remnants of the old tripartite system to be wrong. We believe that a comprehensive system is right, not only from the point of view of the social needs of the community but because it is right educationally. We believe that we should not separate our children at the early age of 11, but that we should provide the proper environment to allow their abilities and talents to develop in the way they should.
      It is for this reason that my right hon. Friend the Secretary of State for Education and Science is giving a lead to the country and will ask that those authorities which have not prepared the schemes they should, and which have not ended selection at 11-plus, should fall into line with the approach that is the right approach for a democratic society.
      Sir Robert Cary: By destroying the grammar schools?
      Mr. Peart: I remind the hon. Gentleman again that many of us on these benches are products of the grammar schools. I taught in a grammar school. We want extension of what we term academic education in a comprehensive system to all children who will profit by it. I remember very often boys and girls who had to go to the ordinary secondary modern school and later developed, but had no opportunity properly to develop, those academic abilities. I want to end these anomalies. I want to create an education system which does not divide our society into three sections at the early age of 11 in the State sector. That is the challenge, and I will challenge right hon. and hon. Members opposite in any
      constituency on this great issue of educational opportunity.
      The right hon. Gentleman the Member for Birmingham, Handsworth (Sir E. Boyle)—I am sorry that he is leaving the House—is progressive on this issue, but he is an exception opposite. He is a Fabian and believes in a gradual approach, but he accepts the principle of comprehensive education. There are many backwoodsmen, however, on the benches opposite.
      Sir Edward Boyle rose—
      Hon. Members: Give way.
      Sir E. Boyle rose—
      Hon.Members: Give way.
      Mr. Speaker: Order. If the Leader of the House does not give way the right hon. Member for Birmingham, Hands-worth (Sir E. Boyle) must resume his seat.
      Sir E. Boyle: I thank the Leader of the House for giving way. Is he not aware that I have said publicly and firmly that I am opposed to compulsion? Where an authority has a sound scheme, we have always said, "All right—go ahead". But we are utterly opposed to compulsion.
      Hon. Members: Withdraw.
      Mr. Peart: I do not withdraw. I said that the right hon. Gentleman believes in comprehensive education. He says that he does not accept the principle of compulsion. But I remind him that for the vast majority of children in the State sector there has really been compulsion because they have had no choice. They have been condemned to a system which I believe to be inferior. He knows that in his heart—and he is nearer to us than the crowd he is leaving behind him.
      Question put, That the Amendment be made:—
      The House divided: Ayes 241, Noes 303.

      Division No. 2.]

      Ayes

      [10.0 p.m.

      Alison, Michael (Barkston Ash)

      Baker, Kenneth (Acton)

      Bell, Ronald

      Allason, James (Hemel Hempstead)

      Baker, W. H. K. (Banff)

      Bennett, Sir Frederic (Torquay)

      Amery, Rt. Hn. Julian

      Balniel, Lord

      Bennett, Dr. Reginald (Gos. & Fhm)

      Astor, John

      Barber, Rt. Ho. Anthony

      Berry, Hn. Anthony

      Atkins, Humphrey (Wen & M'd'n)

      Batstord, Brian

      Biggs-Davison, John

      Awdry, Daniel

      Beamish, Col. Sir Tutton

      Black, Sir Cyril

      Blaker, Peter

      Harrison, Col. sir Harwood (Eye)

      Osborn, John (Hallam)

      Boardman, Tom (Leiceser, S.W.)

      Harvey, Sir Arthur Vere)

      Page, John (Harrow, W.)

      Body, Richard

      Harvie Anderson, Miss

      Pardoe, John

      Bossom, Sir Clive

      Hastings, Stephern

      Pearson, Sir Frank (Clitheroe)

      Boyd-Carpenter, Rt. Hn. John

      Hawkins, Paul

      Peel, John

      Boyle, Rt. Hn. Sir Edward

      Hay, John

      Percival, Ian

      Braine, Bernard

      Heald, Rt.Hn. Sir Lionel

      Peyton, John

      Brewis, John

      Heath, Rt. Hn. Edward

      Pink, R. Bonner

      Brinton, sir Tatton

      Higgins, Terence L.

      Pounder, Rafton

      Bromley-Davenport, Lt.-Col.Sir Walter

      Hiley, Joseph

      Powell, Rt. Hn. J. Enoch

      Brown, Sir Edward (Bath)

      Hill, J. E. B.

      Price, David (Eastleigh)

      Burce-Gardyne, J.

      Hogg, Rt. Hn. Quintin

      Prior, J. M. L.

      Bryan, Paul

      Holland, Philip

      Pym, Francis

      Buchanan-Smith, Alick(Angus, N&M)

      Hordern, Peter

      Quennell, Miss J. M.

      Buck, Antony (Colcheser)

      Hornby, Richard

      Ramsden, Rt. Hn. James

      Bullus, Sir Eric

      Howell, David (Guildford)

      Rawlinson, Rt. Hn. Sir Peter

      Burden, F. A.

      Hunt, John

      Rees-Davies, W. R.

      Campbell, B. (Oldham, W.)

      Hutchison, Michael Clark

      Renton, Rt. Hn. Sir David

      Campbell, Gordon (Moray & Nairn)

      Iremonger, T. L.

      Rhys Williams, Sir Brandon

      carlisle, Mark

      Irvine, Bryant Godman (Rye)

      Ridley, Hn. Nicholas

      Carr, Rt. Hn. Robert

      Johnson Smith, G. (E. Grinstead)

      Ridsdale, Julian

      Cary, Sir Robert

      Johnson Russell (Inverness)

      Rippon, Rt. Hn. Geoffrey

      Channon, H. P. G.

      Jones, Arthur (Northants, S.)

      Robson Brown, Sir William

      Chataway, Christopher

      Jopling, Michael

      Rodgers, Sir John (Sevenoaks)

      Chichester-Clark. R.

      Joseph, Rt. Hn. Sir Keith

      Rossi, Hugh (Hornsey)

      Clark, Henry

      Kerby, Capt. Henry

      Royle, Anthony

      Clegg, Walter

      Kershaw, Anthony

      Russell, Sir Ronald

      Cooke, Robert

      Kimball, Marcus

      St. John-Stevas, Norman

      Cooper-Key, Sir Neill

      King, Evelyn (Dorset, S.)

      Sandys, Rt. Hn. D.

      Cordle, John

      Kirk, Peter

      scott, Nicholas

      Corfield F. V.

      Kitson, Timothy

      Scot-Hopkins, James

      Costain, A. P.

      Knight, Mrs. Jill

      Sharples, Richard

      Craddock, Sir Beresford (Spelthorne)

      Lambton, Viscount

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

      Crouch, David

      Lancaster, Col. c. G.

      Sinclair, Sir George

      Crowder, F. P.

      Lane, David

      Smith, Dudley (W'wick & L'mington

      Cunningham, sir Knox

      Langford-Hold, Sir John

      Smith, John (London & W'minster)

      Currie, G. B. H.

      Lawler, Wallace

      Stainton, Keith

      Dalkeith, Earl of

      Legge-Bourke, Sir Harry

      Stodart, Anthony

      Dance, James

      Lewis, Kenneth (Rutland)

      Stoddart-Scott, Col. Sir M.

      d, Avigdor-Goldsmid, Sir Henry

      Llovd.Rt. Hn. Geoffrey(sut'nc'dfield)

      Summers, Sir Spencer

      Dean, Paul

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

      Tapsell, Peter

      Deedes, Rt. Hn. W. F. (Ashford)

      Lloyd, Rt. Hn. Selwyn (Wirral)

      Taylor, Sir Charles (Eastbourne)

      Digby, Simon Wingfield

      Longden, Gilbert

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

      Douglas-Home, Rt. Hn. Sir Alec

      Lubbock, Eric

      Taylor, Frank (Moss Side)

      Drayson, G. B.

      McAddeen, Sir Stephen

      temple, John M.

      du Cann, Rt. Hn. Edward

      MacArthur, Ian

      Thatcher, Mrs. Margaret

      Eden, Sir John

      Mackenzie, Alasdair(Ross & Crom'ty)

      Thorpe, Rt. Hn. Jeremy

      Emery, Peter

      Maclean, Sir Fitzroy

      Tilney, John

      Errington, Sir Eric

      Macleod, Rt.Hn. lain

      Turton, Rt. Hn. R. H.

      Ewing, Mrs. Winifred

      McMaster, Stanley

      Van Straubenzee, W. R.

      Eyre, Reginald

      Macmillan, Maruice (Franham)

      Vickers, Dame Joan

      Farr, John

      McNair-Wilson, Michael

      Waddington, David

      Fisher, Nigel

      McNair-Wilson, Patrick (NewForest)

      Wainwright, Richard (Colne Valley)

      Fletcher-Cooke, Charles

      Maddan, Martin

      Walker, Peter (Worcester)

      Fortescue, Tim

      Maginnis, John E.

      Wall, patrick

      Foster, Sir John

      Marples, Rt. Hn. Ernest

      Walters, Dennis

      Galbraith, Hn. T. G.

      maude, Angus

      Ward, C. (Swindon)

      Gibson-Watt, David

      Maudling, Rt. Hn. Reginald

      Ward, Dame Irene (Tynemouth)

      Gilmour, Ian (Norfolk. C.)

      Mawby, Ray

      weatherill, Bernard

      Glover, Sir Douglas

      Maxwell-Hyslop, R. J.

      Wells, John (Maidstone)

      Glyn, Sir Richard

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

      whitelaw, Rt. Hn. William

      Godber, Rt. Hn. J. B.

      Mills, Peter (Torrington)

      Wiggin, A. W.

      Goodhart, Philip

      Mills, Stratton (Belfast, N.)

      Williams, Donald (Dudley

      Goodhew, Victor

      Miscampbell, Norman

      Wilson, Geoffrey (Truro)

      Gower, Raymond

      Mitchell, David (Basingstoke)

      winstanley, Dr. M. P.

      Grant, Anthony

      Monro, Hector

      Wolrige-Gordon, Patrick

      Grant-Ferris, Sir Robert

      Montgomery, Fergus

      Wood, Rt. Hn. Richard

      Gresham Cooke, R.

      Morgan, Geraint (Denbigh)

      Woodnutt, Mark

      Grieve, Percy

      Morgan-Giles, Rear-Adm.

      Worsley, Marcus

      Gurden, Harold

      Morrison, Charles (Devizes)

      Wright, Esmond

      Hall-Davis, A. G. F.

      Mott-Radclyffo, Sir Charles

      Younger, Hn. George

      Hamilton, Lord (Fermanagh)

      Munro-Lucas-Tooth, Sir Hugh

      Hamilton, Michael (Salisbury)

      Noble, Rt. Hn. Michael

      TELLERS FOR THE AYES:

      Harris, Frederic (Croydon, N.W.)

      Onslow, Cranley

      Mr. R. W. Elliott and

      Harris, Reader (Heston)

      Orr, Capt. L. P. S.

      Mr. Jasper More

      Harrison, Brian (Maldon)

      Orr-Ewing, Sir Ian

      NOES

      Albu, Austen

      Anderson, Donald

      Atkinson, Norman (tottenham)

      Allaun, Frank (Salford, E.)

      Ashley, Jack

      Bacon, Rt. Hn. Alice

      Alldritt, Walter

      Ashton, Joe (Bassetlaw)

      Barnes, Michael

      Allen, Scholefield

      Atkins, Ronaid (Preston, N.)

      Barnett, Joel

      958

      959

      Baxter,William

      Golding, J.

      Mahon, Peter (Preston, s.)

      Beaney, Alan

      Gray, Dr. Hugh (Yarmouth)

      Mahon, Simon(Bootle)

      Bence, Cyril

      Greenwood, Rt. Hn. Anthony

      Mallalieu, E.L. (Brigg)

      Ben, Rt. Hn. Anthony Wedgwood

      Gregory, Arnold

      Mallalieu, J P.W. (Huddersfield, E.)

      Bennett, James (G'gow, Bridgeton)

      Grey, Charles (Durgham

      Mauel, Archie

      Bidwell, Sydney

      Griffiths, David (Rother Valley)

      Mapp, Charles

      Binns, Johny

      Griffiths, Eddie (Brightside)

      Marks, Kenneth

      Blenkinsop, Arthur

      Griffiths, Will (Exchange)

      Marquand, David

      Boardman, H. (Leigh)

      Gunter, Rt. Hn. R.J.

      Marsh, Rt. Hn. Richard

      Booth, Albert

      Hamilton, James (Bothwell)

      Mason, Rt. Hn. Roy

      Bottomley, Rt. Hn. Arthur

      Hamilton, William(Fife, W.)

      Mayhew, Christopher

      Boyden, James

      Hamling, William

      Mellish, Rt. Hn. Robert

      Bradley, Tom

      Hannan, William

      Mendelson, John

      Bray, Dr. Jeremy

      Harper, Joseph

      Mikardo, Ian

      Brooks, Edwin

      Harrison, Waiter (Wakefield)

      Millan, Bruce

      Broughton, Sir Alfred

      Hart, Rt. Hn. Judith

      Miller, Dr. M. S.

      Brown, Hugh d. (G'gow, Provan)

      Haseldine, Norman

      Milne, Edward (Blyth)

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

      Hattersley, Roy

      Mitchell, R. C. (S'th'pton, Test)

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

      Hazell, Bert

      Molloy, William

      Buchan, Norman

      Healey, Rt. Hn. Denis

      Moonman, Eric

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

      Heffer, Eric s.

      Morgan, Elystan (Cardiganshire)

      Butler, Herbert (Hackney, c.)

      Henig, Stanley

      Morris, Charles R. (Openshaw)

      Butler, Mrs. Joyce (Wood Green)

      Hilton, W. S.

      Morris, John (Aberavon)

      Callaghan, Rt. Hn. James

      Hooley, Frank

      Moyle, Roland

      Cant, R. B.

      Horner, John

      Mulley, Rt. Hn. Fredeirck

      Carmichael, Neil

      Houghton, Rt. Hn. Douglas

      Murray, Albert

      Carter-Jones, Lewis

      Howarth, Robert (Bolton, E.)

      Neal, Harold

      Castle, Rt. Hn. Barbara

      Howell, Denis (Small Heath)

      Newens, Stan

      Chapman, Donald

      Howie, W.

      Noel-Baker, Rt. Hn. Philip

      Coe, Denis

      Hoy, Rt. Hn. James

      Norwood, Christopher

      Coleman, Donald

      Huckfield, Leslie

      Oakes, Gordon

      Concannon, J. D.

      Hughes, Rt. Hn. Cledwyn (Anglesey)

      Ogden, Eric

      Conlan, Bernard

      Hughes, Hector (Aderdeen, N.)

      O'Halloran, M. J.

      Corbet, Mrs. Freda

      Hughes, Roy (Newport)

      O'Malley, Brain

      Craddock, George (Bradford, S.)

      Hunter, Adam

      Oram, Albert E.

      Crawshaw, Richard

      Hynd, John

      Orbach, Maurice

      Crosland, Rt. Hn. Anthony

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

      Orme, Stanley

      Crossman, Rt. Hn. Richard

      Jackson, Peter M. (High Peak)

      Oswald, Thomas

      Dalyell, Tam

      Jay, Rt. Hn Douglas

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

      Darling, Rt. Hn. George

      Jeger, George (Goole)

      Owen, Will (Morpeth)

      Davidson, Arthur (Accrington)

      Jeger,Mrs.Lena(H'b'n&St.P'cras,S.)

      Padley, Walter

      Davies, Ednyfed Hudson (Conway)

      Jenkins, Hugh (Putney)

      Page, Derek (King's Lynn)

      Davies, G. Elfed (Rhondda, E.)

      Jenkins, Rt. Hn. Roy (Stechford)

      Paget R. T.

      Davies, Dr. Ernest (Stretford)

      Johnson, carol (Lewisham, S.)

      Palmer, Arthur

      Davies, Ifor (Gower)

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

      Pannell Rt. Hn. charles

      Davies, s.O. (Merthyr)

      Jones, Dan (Burnley)

      Park, Trevor

      de Freitas, Rt. Hn. Sir Geoffrey

      Jones,Rt. Hn. Sir Elwyn(W.Ham,S.)

      Parker, John (Dagenham)

      Delargy, Hugh

      Jones, T. Alec (Rhondda, West)

      Parkyn, Brian (Bedford)

      Dell, Edmund

      Judd. Frank

      Pearson, Arthur(Pontypridd)

      dempsey, James

      Kelley, Richard

      Peart, Rt. Hn. Fred

      Dewar, Donald

      Kerr, Mrs. Anne (R'ter & Chatham)

      Pentland, Norman

      diamond, Rt. Hn. John

      Kerr, Russell (Feltham)

      Perry, Ernest G. (Battersea, S.)

      Dickens, James

      Latham, A.

      Perry, George H. (Nottingham, S.)

      Dobson, Ray

      Lawson, George

      Prentice, Rt. Hn. Reg.

      Doig, Peter

      Leadbitter, Ted

      Price, Thomas (Westhoughton)

      Driberg, Tom

      Lee, Rt. Hn. Fredeirck (Newton)

      Price, William (Rugby)

      Dunn, James A.

      Lee, Rt. Hn. Jennie (Cannock)

      Probert, Arthur

      Dunnett, Jack

      Lee, John (Reading)

      Pursey, Cmdr. Harry

      Dunwoody, Mrs. Gwyneth (Exeter)

      Lestor, Miss Joan

      Randall, Harry

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

      Lever, Rt. Hn. Harold (Cheetham)

      Rankin, John

      Eadle, Alex

      Lewis, Arthur (W. Ham, N.)

      Rees, Merlyn

      Edelman, Maurice

      Lewis, Ron (carlisle)

      Rhodes, Geoffrey

      Edwards, William(Merioneth)

      Lipton, Marcus

      Richard, Ivor

      Ellis, John

      Loughlin, charles

      Roberts, Rt. Hn. Goronwy

      English, Michael

      Luard, Evan

      Roberts, Gwilym (Bedfordshire, S.)

      Ennals, David

      Lyon,Alexander W. York)

      Robertson, John (Paisley)

      Evans, Albert (Islington, S.W.)

      Mabon, Dr. J. Dickson

      Rodgers, William (stockton)

      Evans, Fred (caerphilly)

      McBride, Neil

      Roebuck, Roy

      Faulds, Andrew

      McCann, John

      Rogers, George (kensington, N.)

      Fernyhough, E.

      MacColl, James

      Rose, Paul

      Finch, Harold

      MacDermot, Niall

      Ross, Rt. Hn. William

      Fitch, Alan (wigan)

      Macdonald, A. H.

      Rowlands, E.

      Fletcher, Rt. Hn. Sir Eric(Islington, E.)

      McElhone, F.

      Ryan, John

      Fletcher, Ted (Darlington)

      McGuire, Michael

      Shaw, Arnold (llford, S.)

      Foot, Michael (Ebbw Vale)

      McKay, Mrs. Margaret

      Sheldon, Robert

      Ford, Ben

      Mackenzie, Gregor (Rutherglen)

      shinwell, Rt. Hn. E.

      Forrester, John

      Mackie, John

      Shore, Rt. Hn. Peter (stepney)

      Fraser, John (Norwood)

      Mackintosh, John P.

      Short,Rt. Hn.Edward(N'c'tle-u-tyne)

      Freeson, Reginald

      MacMillan, Robert

      Short, Mrs. Renee (W'hampton, N. E.)

      Galpern, Sir Myer

      MacMillan, Malcolm (Western Isles)

      silkin, Rt. Hn. John (Deptford)

      Gardner, Tony

      MacMillan, Tom (Glasgow, C.)

      Silkin, Hn. S. C. (Dulwich)

      Garrett, W.E.

      McNamara, J. Kevin

      Silverman, Julius

      Ginsburg, David

      MacPherson, Malcolm

      Skeffington, Arthur

      960

      961

      Slater, Joseph

      Varley, Eric G.

      Williams, Clifford (Abertillery)

      Small, William

      Wainwright, Edwin (Dearne Valley)

      Williams, Mrs, Shirley (Hitchin)

      Snow, Julian

      Walden, Brian (All Saints)

      Williams, W. T. (Warrington)

      Spriggs, Leslie

      Walker, Harold (Doncaster)

      Willis, Rt. Hn. George

      Steele, Thomas (Dunbartonshire, W.)

      Walker, David (Consett)

      Wilson, Rt. Hn. Harold (Huyton)

      Stewart, Rt. Hn. Michael

      Watkins, Tudor (Brecon & Radnor)

      Wilson, William (Conventry, S.)

      Stonehouse, Rt. Hn. John

      Weitzman, David

      Winnick, David

      Strauss, Rt. Hn. G. R.

      Wellbeloved, James

      Woodburn, Rt. Hn. A.

      Summerskill,,Hn. Dr. Shirley

      Wells, William (Walsall, N.)

      Woof, Robert

      Taverne, Dick

      White, Mrs. Eirene

      Wyatt, Woodrow

      Thomas, Rt. Hn. George

      Whitlock, William

      Thornton, Ernest

      Wilkins, W.A.

      TELLERS FOR THE NOES:

      Tinn, James

      Willey, Rt. Hn. Frederick

      Mr. Ioan L. Evans and

      Tuck, Raphael

      Williams, Alan (Swansea, W.)

      Mr. Ernest Armstrong.

      Urwin, T. W.

      Main Question put and agreed to. Resolved
      That an humble Address be presented to Her Majesty as follows:
      Most Gracious Sovereign,
      We, Your Majesty's most dutiful and loyal subjects, the Commons of the United King-
      962
      dom of Great Britain and Northern Ireland, in Parliament assembled, beg leave to offer our humble thanks to your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.
      To be presented by Privy Councillors or members of Her Majesty's Households

      HOUSING (INCREASE OF SUBSIDY)
      10.13 p.m.
      The Minister of Housing and Local Government (Mr. Anthony Greenwood): I beg to move,
      That the Assistance for House Purchase and Improvement (Increase of Subsidy) Order 1969, a draft of which was laid before this House on 16th October, in the last Session of Parliament, be approved.
      This draft Order gives effect to the Government's promise, which I made during the passage of the Housing Act, 1969, to make an Order adjusting the option mortgage subsidy. The Order is needed to restore —[Interruption.]
      Mr.Speaker: Order. It is difficult for one man to debate against a multitude of debaters.
      Mr. Greenwood: The Order is needed to restore the relative value of the subsidy, relative, that is, to the tax relief on mortage interest, to which the subsidy is meant as an alternative.
      The Option mortage scheme was devised to help people of modest means to buy their homes by giving them benefits roughly equal to those available to people with higher incomes. With an ordinary mortage, a person is excused paying income tax on that part of his income that he used to pay mortage interest. With an option mortage, he renonces the right to tax relief on this interest, getting instead, part of the interest on his loan paid by a Government subsidy.
      When the scheme was introduced, the subsidy was expressed for the ordinary kind of building society mortage as a flat 2 per cent. reduction of the interest charged to the mortagagor. But the interest charged by building societies has since rise, while the subsidy has remained at a flat rate, though the tax relief has automatically adjusted itself because interest on a mortage is deducted from a person's income before his income tax is calculated.
      To be precise, when the 2 per cent. subsidy was calculated, the rate of mortagage interest recommended by the Building Societies Association was 6¾ per cent. Since then it has risen by steps to 8½ per cent. When the scheme was introduced a family man with moderate earnings, by
      964
      opting into the scheme, could put himself in a position reasonably comparable with that of the man who could get tax relief at the standard rate of 8s. 3d. in the £. This no longer holds.
      The draft Order has accordingly been devised to secure that the value of the option mortgage subsidy is broadly related to normal tax relief, by ensuring, on the one hand, that the value of the subsidy is greater than tax relief to a taxpayer who pays his mortgage interest wholly out of earned income taxed at the reduced rate of 6s. in the £, and, on the other hand, that the value of the subsidy is not more than the value of tax relief to a taxpayer who pays his mortgage interest wholly out of earned income taxed at the standard rate. In fact, it has to be fixed at a shade less, because the scheme was never meant to make the option mortgage subsidy more favourable than tax relief at the standard rate.
      I am sure that the Order will be welcomed by hon. Members on both sides. I welcome back to the Opposition Front Bench the hon. Member for Chichester (Mr. Chataway), and we look forward to his taking a consistent interest in these matters.
      When the matter was before the House —in the debates on the housing Measure in May—the order-making power was welcomed. Indeed, there was an enthusiastic Amendment designed to pin down the Government to make an order before 31st December this year. That Amendment was resisted because it would have been rash to fix a date at a time when the Measure was not yet through and when consultations had still to be held with the representatives of the lending agencies; namely, the Building Societies Association, the insurance associations and the local authority associations.
      A promise was, however, given that the Government would lay an order before the House as soon as the Bill had been passed and the necessary consultations, in which the lending agencies proved very helpful, were carried through. This promise is now being implemented.
      It will be noticed that the new scales of subsidy are to come into effect on 1st January. There is a special significance in this date; namely, that for the vast

      965
      majority of building societies it is the beginning of their financial year. Accordingly, the lending agencies were agreeable to the new scale taking effect from then.
      If the new scales come into effect on 1st January, it will be possible to arrange for many borrowers to feel the effect straight away from that date. In other cases, though the benefit will at once be credited to the borrower, it will not at once involve a reduction in his payments, but it will in the length of the loan.
      As I suggested when explaining the order-making power in May, the Order has taken the form of a scale of subsidy; or, rather, one scale for the ordinary annuity mortage, where the periodic payments generally remain at the same amount and consist partly of repayment of capital and partly of interest on the capital outstanding, and another scale for the endowment mortage, where the whole of the capital is outstanding till the end of the period, when it is repaid in a lump sum by the proceeds of an endowment assurance.
      The advantage of a scale is not only that it suits various existing cases, but that it avoids the need to be framing a new Order from time to time on account of changes in the rate of mortage interest
      The Order does not, of course, give a higher rate of subsidy in those cases of mortage interest where the present subsidy is adequate; namely, in the cases where the mortage interest is not above 7 per cent. There are some such cases, where the loan has been made at a fixed rate or where the lender has found it possible to refrain from increasing a variable rate, to increase the subsidy for such borrows would give more benefit than tax relief at the standard rate. Above the level of 7 per cent. mortage interest, the scale provides for an increasing rate of subsidy to match different rates of mortage interest. It will work whether the mortagage rates go up or down.
      10.21 p.m.
      Mr. Christopher Chataway: I am extremely grateful to the right hon. Gentleman the Minister for his courteous remarks. I am glad on a first occasion, after a while, at the
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      Dispatch Box to be able to give a welcome, even though I am afraid that it is a pretty small welcome, to the Order. I hope that there may be future occasions when one will be able to welcome legislation more wholeheartedly.
      The Order is designed, as the right hon. Gentleman has made clear, to help house purchasers of modest means who are required to pay high interest rates, and it is confession of failure. It results from rates of mortgage interest which four or five years ago would have been considered absolutely unthinkable. If anyone from this side of the House had suggested four or five years ago that we should now be debating an Order designed exclusively to help people when mortgage rates of interest were over 7 per cent.—because the Order, as paragraph 3 makes clear, is designed only for such a situation—no one would have believed him.
      We have throughout the day had a certain amount of debate about these interest rates, and we have understood from right hon. and hon. Gentlemen opposite that they feel themselves absolved from guilt because of the high international rates of interest—
      Mr. Speaker: Order. The hon. Gentleman must not widen the debate. We are discussing a specific Order, and not the last debate.
      Mr. Chataway: I accept your Ruling, of course, Mr. Speaker. It is my contention, however, that paragraph 3 amounts to a confession of failure on the part of the Government, since it amounts to an admission that the Government have not succeeded in meeting their promise about lowering interest rates, and assumes, moreover, that the Government are unlikely to meet this promise in the foreseeable future. Otherwise, I assume, the Order would not have been laid.
      Both the mortgage option scheme and this scheme have a fairly unhappy parentage. The mortgage option scheme is born of the Government's failure to meet the quite categorical promises that were made at the 1964 and 1966 elections to reduce mortgage interest rates—
      Mr. Speaker: Order. We are not discussing the mortgage option scheme. We

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      are discussing a Statutory Instrument which varies certain rates of subsidy. The hon. Gentleman will not be out of order if he talks about the Statutory Instrument we are discussing.
      Mr. Chataway: The variation which this Statutory Instrument makes is a result of interest rates which have risen since the mortgage option scheme was started from 64 per cent. to 81 per cent. It will give some help to house purchasers, but I think we may ask "how much?".
      As has been made clear on one or two occasions, in October, 1964, the cost of the average new house was £3,470: today it is £4,782. Five years ago a man with an 80 per cent. mortgage repayable over 25 years had to put down a deposit of £700 and paid back each month £18 6s. 4d.
      As a result of this Order and this slight improvement on the mortgage option scheme, the house purchaser who today faces an average cost for a new house of £4,782 will have to pay a deposit of £960, which compares with £700 before the mortgage option scheme, and will face monthly repayments of £25 2s. 9d., compared with £18 6s. 4d. before the mortgage option scheme. I hope the House will be under no illusion. Although this Order brings some small additional help, it by no means restores the house purchaser's position to what it was before the mortgage option scheme was introduced.
      It should be remembered that this scheme is of value only to some 10 per cent. of potential house purchasers; 90 per cent. do not avail themselves of the mortgage option scheme at all because it would not pay them to do so. We can give this Order a welcome, but we have to recognise that it is a small thing.
      10.26 p.m.
      Mr. A. H. Macdonald: I do not want to detain the House for long, but I should like to have my sixpenn'orth in offering a welcome to this Order. I recognise that this is a narrow debate. Otherwise I might have taken the opportunity to say something in rebuttal of the remarks made by the hon. Member for Chichester (Mr. Chataway) about allegedly categorical promises. I think his remarks ill-founded.
      Mr. Speaker: Order. The hon. Member must resist temptation.
      Mr. Macdonald: In my constituency this Order will be especially welcomed. I always listen with interest when other hon. Members describe their constituencies. Mine is filled with owner-occupiers who have properties of varying size and worth. When the mortgage option scheme came in it was welcomed, but only today a constituent came to see me and said he had been in difficulties since taking up a mortgage option scheme. This Order will give him relief. When he took out the original scheme it was suited to his requirements but since then there has been a rise in interest rates, for which I do not lay blame on the Government. There has also been an increase in his salary, which is not due to the Government, but there has been an increase in taxation, for which the Government bear responsibility.
      Mr. Speaker: None of this has anything to do with this Order.
      Mr. Macdonald: I apologise, Mr. Speaker. I was trying to explain that the taxation adjustments and alterations to which my right hon. Friend has referred show the necessity for bringing forward an Order of this kind to restore the status quo when the mortgage option scheme was brought in. This Order does precisely that; therefore I welcome it. I know from personal experience, having served on the housing advances panel of a local authority, how well the original scheme went and therefore how well it will go now that this amending Order is to come into force. It will help a large number of my constituents in their financial affairs, and, therefore, I am pleased to give it a welcome.
      10.30 p.m.
      Mr. Wallace Lawler: Any Measure that helps members of the low income group or the moderate income group to engage in home ownership is to be welcomed. Thus I welcome the Order, even if in somewhat cautious terms.
      If the option mortgage scheme is viewed with caution by many families with moderate or low incomes, as I think it is, those who decide to take advantage of the scheme are those who for the most part expect to remain in the lower

      969
      income or moderate income class. It is probably true that only a small percentage of house purchasers take advantage of the option mortgage scheme, because most young people seeking a mortgage expect their income to rise. They see danger in engaging in the option mortgage scheme when their incomes might increase later. Although I welcome the Order, I ask the Minister to consider whether it is not worth while considering whether those who have entered the option mortgage scheme and who will now receive the additional benefit and those who enter it in future—
      Mr. Deputy Speaker (Mr. Sydney Irving): Order. The hon. Gentleman cannot discuss the merits of the option mortgage scheme, only the change in the subsidy effected by the Order.
      Mr. Lawler: I accept your Ruling, Mr. Deputy Speaker. I content myself with saying that I hope that the Order will be the forerunner of further advantages which may equate with the 4 per cent. ceiling level that we give to the public sector.
      10.32 p.m.
      Mr. Sydney Bidwell: It is difficult to grasp the whole meaning of the Order without a considerable amount of study. I would like my right hon. Friend to clarify the present position. Has a borrower who has not taken advantage of the present facilities of the scheme any option of applying later on? As building societies issue brochures, based on the present 8½ per cent. rate, setting out details of the facilities available under the present option mortgage interest rates, and as the Order will have a material bearing on the question whether a borrower should opt for this scheme, will my right hon. Friend ask building societies quickly to adjust their explanatory booklets to make that facility known to those who are currently inquiring?
      Question put and agreed to.
      Resolved,
      That the Assistance for House Purchase and Improvement (Increase of Subsidy) Order 1969, a draft of which was laid before this House on 16th October, in the last Session of Parliament. be approved.

      PUBLIC PETITIONS
      Select Committee appointed to whom shall be referred all Petitions presented to the House, with the exception of such as are deposited in the Private Bill Office, and such Committee to classify and prepare abstracts of the same in such form and manner as shall appear to them best suited to convey to the House all requisite information respecting their contents, and to report the same from time to time to the House; and the Reports of the Committee to set forth, in respect of each Petition, the number of signatures which are accompanied by addresses, and which are written on sheets, headed in every case by the prayer of the Petition, or on the back of such sheets provided that on every sheet after the first the prayer may be reproduced in print or by other mechanical process; and such Committee to have power to direct the printing in extenso of such Petitions, or of such parts of Petitions, as shall appear to require it:
      Mr. Walter Alldritt, Mr. Cyril Bence, Mr. Bernard Braine, Lieutenant-Colonel Sir Walter Bromley-Davenport, Mr. David Griffiths, Mr. Hector Hughes, Mr. J. C. Jennings, Colonel Lancaster, Mr. Marcus Lipton, Sir Charles MottRadclyffe, Sir Hugh Munro-Lucas-Tooth, Mr. Harold Neal, Mr. Arthur Probert, Mr. Leslie Spriggs, and Mr. Tudor Watkins :
      Power to send for persons, papers and records:
      Three to be the Quorum.—[Mr.loan L. Evans.]

      PARLIAMENTARY COMMISSIONER FOR ADMINISTRATION
      Select Committee appointed to examine the reports laid before this House by the Parliamentary Commissioner for Administration, and matters in connection therewith:
      Minutes of the Evidence of 15th October taken before the Select Committee in the last Session of Parliament to he referred to the Committee:
      Mr. Antony Buck, Mr. Charles Fletcher-Cooke, Mr. Stanley Henig, Mr. Dan Jones, Mr. Frederick Lee, Mr. Alexander Lyon. Mrs. Margaret McKay,

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      Sir Hugh Munro-Lucas-Tooth, Mr.Arthur Probert, Dame Irene Ward, and Dr. Winstanley:
      Power to send for persons, papers and records; and to report from time to time:
      Four to be the Quorum of the Cornmittee.—[Mr. loan L. Evans.]

      OVERSEAS AID
      Select Committee appointed to consider the activities of the Ministry of Overseas Development:
      Committee to consist of Eighteen Members:
      Sir Frederick Bennett, Mr. Arthur Blenkinsop, Mr. Bernard Braine, Mr. Henry Clark, Mr. Donald Coleman, Mr. James Davidson, Mr. Andrew Faulds, Mr. Tony Gardner, Mr. Philip Goodhart, Miss Margaret Herbison, Mr. Terence L. Higgins, Mr. Frank Hooley, Mr. Frank Judd, Mr. Alexander Lyon, Mr. Cranley Onslow, Mr. Laurence Pavitt, Sir George Sinclair, and Mr. James Tinn:
      Power to send for persons, papers and records; to sit notwithstanding any adjournment of the House; to adjourn from place to place; to admit strangers during the examination of witnesses unless they otherwise order; and to report Minutes of Evidence from time to time:
      Power to report from time to time:
      Nine to be the Quorum of the Committee:
      Power to appoint two Sub-Committees and to refer to such Sub-Committees any of the matters referred to the Committee:
      Every such Sub-Committee to have power to send for persons, papers and records; to sit notwithstanding any adjournment of the House; to adjourn from place to place; to report to the Committee from time to time, and to admit strangers during the examination of witnesses unless they otherwise order:
      Two to be the Quorum of every such Sub-Committee:
      Power to report from time to time the Minutes of the Evidence taken before such Sub-Committees.—[Mr. loan L. Evans.]

      POLICE OFFICERS (INVESTIGATIONS INTO ALLEGATIONS)
      Motion made, and Question proposed, That this House do now adjourn.—[Mr. loan L. Evans.]
      10.35 p.m.
      Mr. Tim Fortescue: I am very grateful, after a number of alarums and excursions—perhaps I might almost say, fire alarms and excursions—to have the opportunity of raising at this hour on the Adjournment a question which gave me very considerable concern during the Recess and which to a considerable extent affects the morale of our police forces.
      The establishments of our police forces are very low. The Home Secretary himself said on 29th October:
      "There are vacancies in the police forces now. Recruits are not coming forward as fast as I should like. Indeed, we need an estimated 5,000 recruits in England and Wales in the rest of this financial year & There are hundreds of vacancies for candidates of the right type."—[OFFICIAL REPORT, 29th October, 1969; Vol. 790, c. 195.]
      In the police force which I know best—that is, the Liverpool and Bootle constabulary—they are 640 men short against their normal establishment, and they are 60 men short of the greatly reduced establishment which is now permitted to them. They are unable to find recruits. The wastage of men from that constabulary is bigger than the number of recruits they are obtaining week by week.
      There are, of course, reasons for this. The chief reason, I believe, is that the pay and conditions offered are unsatisfactory; and men can find work in the Liverpool area in conditions far less strenuous and far less arduous than those which meet the police force, and for considerably higher wages than those which are offered to police recruits. Men in the motor industry on Merseyside can obtain much higher wages for doing much less work than the police are expected to do.
      It would, therefore, seem to me to be very important that everything possible should be done to see that the morale of the existing members of the police force is kept as high as possible, and I was shocked when I heard of a device which is now being used by the criminal world which can do nothing but affect adversely the morale of our police.

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      The device goes something like this. When a large crime has been committed —a large robbery, shall we say?—and as soon as detectives are assigned to the investigation of that crime, an accomplice of the criminals—I regret to say that it is very often a solicitor—writes to the chief constable of the force concerned and accuses the detectives who have been assigned to the job of complicity in the crime. By the rules of the game, rules with which I entirely agree, this accusation has to be investigated immediately by the chief constable. The men concerned know that they have been accused of impropriety and dishonesty, and their enthusiasm for the investigation at once obviously declines.
      When the chief constable's investigation has been concluded, the facts are sent, under the rules, to the Director of Public Prosecutions, who examines the case. If he finds that there is no case to answer, he informs the chief constable of that fact, and the detectives are informed accordingly. If, however, he believes that further investigation should be made, the case is handed over to a police force separate from the force in which the detectives are serving and further investigation is made.
      My worry is about the case which is found by the Director of Public Prosecutions to be baseless and malicious. When this is done and the names of the detectives are thus cleared, the detectives concerned should have the perfect right to take action in a civil court against their defamer for defamation of character, and this right, of course, they have, but in order to bring that case adequately in the courts they must have access to the original document of accusation which has been sent to the chief constable of their force by the accomplice of the criminal. I discovered that this is not permitted. I found it difficult to believe this, but when I put down a Question late in the last Session I received this reply from the Home Office:
      "Advice, when asked for, has been given to chief officers of police that it is inappropriate to furnish letters of complaint to assist in civil proceedings, because to do so might deter persons from making legitimate cornpla ints."—OFFICAL REPORT, 16th October, 1969 ; Vol. 788, c. 114.]
      So here we have a conflict of public interest: whether it is more important to deter members of the public from making legitimate complaints against the police
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      or whether it is more important to uphold the morale of the police by allowing them, when accusations against them are found to be baseless and malicious, to take the action against their defamers which any ordinary member of the public would be able to take in like circumstances. It would appear that the Home Office's reply that to allow these documents to be produced in evidence might deter persons from making legitimate complaints rests on very thin ground. It one is making a legitimate complaint against anyone else, one surely must be prepared to stand up in court and defend one's action. If the complaint is legitimate, which is the burden of the Home Office's song, then it is legitimate, and it is not baseless and malicious, and therefore no court of law in the land would hold the making of such an accusation against the man who made it. But for this train of thought to be used to disallow policemen who have been unjustly accused from using in court the false evidence that has been used against them is wrong, unjust and, above all, prejudicial to the morale of the police force which, as I have attempted to explain, it is so important to maintain.
      The Home Secretary has set up a working party under the Police Advisory Board, whose terms of reference are:
      "To determine the best system of independent enquiries into serious allegations against police officers."
      This I welcome, and since the whole matter is therefore sub judice I will not take it further this evening. But I ask the Under-Secretary to be so good as to consider whether the question which I have raised could not be taken under advisement by that committee, and whether consideration could not be given to the alteration of this ruling when that committee reports.
      10.45 p.m.
      The Joint Under-Secretary of State for the Home Department (Mr. Elystan Morgan): The issue which has been raised tonight is one of the many and varied questions which arise in connection with the procedures for dealing with complaints made against police officers by members of the public. They are all questions which are undeniably important—some perhaps more particularly important from the point of view of the

      975
      complainant; some perhaps from the point of view of the individual officer against whom the complaint is made. Others may be questions which concern the interests of both sides, to a greater or lesser degree. A number raise issues on which more than one point of view can reasonably and fairly be accommodated.
      The particular question raised by the hon. Member is one such matter. He has argued that it is a clear-cut matter of saying that in any case where a complaint may be worded in what might be thought to be defamatory or otherwise actionable terms, it should necessarily follow that the authorities ought to provide facilities so that the writer can, if the police officer complained of so desires, be brought to account for it in the courts.
      The advice which has been given by the Home Office to chief constables who have asked for it is based upon another consideration. That advice is that it is inappropriate to furnish letters of complaint to police officers who seek them for the purpose of the consideration of civil proceedings, and this advice is based upon the single, simple, but dominant, consideration that to do so might deter persons from making legitimate complaints.
      The statutory provisions and principles of procedure and practice for the investigation of complaints against the police are founded on recommendations of the Royal Commission on the Police which reported in 1962. In putting forward a series of recommendations for establishing a comprehensive system for dealing with complaints, the Commission said that in its view the procedure it recommended would hold the balance of being fair both to the police and to the public, not favouring either at the expense of the other and not undermining the morale of the police as a disciplined force, nor weakening its resolve to fight crime. Those recommendations were accepted by the House and were embodied in the Police Act 1964 and in the Discipline Regulations of 1965.
      The regulations do not provide that an officer should as a matter of routine be furnished with a copy of any letter of complaint about him which may be received from a member of the public. Whether or not an officer is given this
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      document depends on whether he is charged with a disciplinary offence which is founded on the complaint made against him by the member of the public in that document. Indeed, so far as the Discipline Regulations are concerned, it depends wholly on that factor.
      Briefly, the procedure is that when a complaint has been received and recorded, the officer concerned is told in writing of its nature in order that he can be invited to make a statement to the investigating officer. The regulation does not require that the accused officer should be given a copy of the letter from the member of the public making the complaint.
      If, however, after investigation of the complaint, it is decided that the officer should be charged with a disciplinary offence, Regulation 6(1)(b) requires that he must be given, inter alia, a copy of the letter. He is also given a copy of any statement he may have made to the investigating officer, together with copies of witnesses' statements and any other relevant documents which may be required to help him in his defence. The advice contained in the relevant Home Office circular to chief officers of police is that, although there is no specific statutory provision, a complainant should be told—which would normally be when the complainant is seen by the investigating officer—that a copy of his letter and of any statement he may make to the investigating officer will be given to the accused officer if any disciplinary charge is brought.
      In the case given as an example by the hon. Member involving an allegation of the commission of a serious offence there would be no question about its constituting a disciplinary offence. Therefore, in that case and in similar cases the offending document in his example and the complaint in any other proper case would be shown to the officer.
      Mr. Fortescue: I want to get this absolutely clear. My whole case concerns matters where the charge or accusation from the member of the public is found to be baseless and malicious. I am not complaining about disciplinary cases where a disciplinary offence is involved. I am referring to cases where it is established beyond doubt that no disciplinary offence has been committed by the police officer concerned.
      Mr. Morgan: The question whether or not a copy of the letter is actually given to the officer turns not on the end result but upon the nature of the complaint. If the nature of the complaint is such as to involve the running of the disciplinary machinery then, under Regulation 6(1)(b), it would be necessary for a copy of that letter to be shown. If not, a copy would not be shown.
      There is nothing to prevent the officer concerned from eventually making use of the copy of the letter of complaint should he later decide to take civil proceedings against the writer. The document is not, however, given him for that purpose, and it is a wholly incidental effect of the regulations that he has it available to make use of in that way.
      The hon. Member is, however, concerned with the other class of case where a member of the public makes a complaint against an officer which, on investigation, discloses no grounds for disciplinary or other proceedings against the officer. The investigation may have revealed that the complaint was frivolously or maliciously made. In other cases there may be doubt as to the motive of the complainant, while in yet others the complaint may appear to have been made in good faith, but nevertheless to be wholly unfounded in fact.
      I acknowledge that an officer who has been the subject of a complaint and who considers that it was made maliciously and that it contains libellous material may quite reasonably feel aggrieved and wish to take civil proceedings against the writer. It is in such circumstances that a request might be made to the chief officer of police for a copy of the letter or other document to assist the officer in deciding whether to institute proceedings. I want to emphasise this point.
      The decision whether to comply with the request lies within the discretion of the chief officer. It is not a matter in which the Home Secretary has authority to issue directions, and no general guidance has ever been given from the Home Office on the subject. However, chief officers who receive requests for material from police records for use in possible civil proceedings sometimes consult the Home Office about the course they should take, and, as I have said, the advice, when asked for, has been given to chief officers that it is inappro-
      978
      priate to furnish letters of complaint to assist in civil proceedings because to do so might deter persons from making legitimate complaints. The House will want me to enlarge a little on that.
      The advice not to supply copies of letters of complaint has been consistently given in answer to a series of inquiries in individual cases over many years. I am sure that it is no part of the hon. Gentleman's case that this is affecting recruitment to the police.
      The same principle of treating letters of complaint as confidential and not providing them to the subjects of complaint is also followed in relation to other public services, such as the Civil Service, and for the same reason. The basis for the practice, as I have indicated, lies in the view that a member of the public with a genuine complaint might be discouraged from making it by the fear that any letter embodying it might be used in civil proceedings against him. It is true that this fear might be misplaced if the complaint were a genuine one made in good faith, because the complainant in such a case would very often he protected by the rule of qualified privilege. But the view taken is that, on balance, the public interest lies in not allowing this fear—unreasonable though it may be—to discourage genuine complaints.
      The introduction of the statutory complaints procedure in the Police Act, 1964, makes it, in my estimation, even more important that nothing should be done which might seem to be aimed at inhibiting the genuine complainant.
      It might be submitted that this argument falls down now that a copy of a letter which gives rise to disciplinary proceedings has to be given to the officer concerned. I would agree with this to some extent. But the reason for giving the officer a copy in such circumstances is to enable him to defend himself properly in disciplinary proceedings. The rationale of that exception is that an occurrence has taken place which has meant that the disciplinary machinery of the police has been made to run. Within the scope of that machinery it is proper for a complaint which has activated that process to be disclosed to the subject of that complaint. It is a totally different matter in circumstances where that machinery is not running to maintain

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      that there should be the same full disclosure of that document.
      The fact that the officer, having had a copy of that letter in the very limited context, may subsequently use the letter for another purpose is incidental. It does not seem that the practice of withholding letters required only for use in civil proceedings is thereby invalidated.
      I fully recognise the annoyance and possibly distress caused to police officers against whom unfounded allegations are made. However, it is a natural hazard of police work that an officer will from time to time be subject to attack or criticism, and most officers would in the normal way feel themselves adequately vindicated by internal inquiries which clear them of the matters alleged.
      From the police officer's point of view, and that of the police service generally, it may probably be better that a malicious libel which has a limited circulation within the force only should be ignored and not made the subject of civil proceedings where it would come to the attention of a far wider audience. All my remarks have been directed at this type of case. Where defamatory matter has been published outside the police—for example in a newspaper—different considerations arise. Here the document on which the civil proceedings can be founded is the published document or if it were in a television interview, the transcript.
      Mr. Richard Crawshaw: Would my hon. Friend agree that where disciplinary proceedings are not taken, that in itself absolves the officers from any blame? In the instance which the hon. Member has raised, if the alleged libel is by an accomplice of a criminal, the only purpose of proceedings would be to obtain damages and costs against that person. Is it not likely that such a person would not be in a position to pay damages, and therefore the action would not be much use?
      Mr. Morgan: In the instance quoted by the hon. Member it may be that the person who has issued such a document maliciously would not be worth powder and shot, but that is not really the issue.
      In defending the established practice I would not like to be thought to be making light in any way of the genuine
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      anxieties of police officers in this matter, or as supporting the right of evilly disposed persons to make unfounded and scurrilous allegations against police officers with impunity. Such persons should be very much on their guard as the criminal law provides measures for dealing with them. Under Section 5(2) of the Criminal Law Act 1967 a person who causes the wasteful employment of police by making a false report about the commission of an offence can be prosecuted and, if convicted, sentenced to a maximum of six months' imprisonment. In 1968, in the Metropolitan Police District alone three persons were convicted under this section for causing a waste of police time in investigating false allegations made against individual police officers. In addition, in certain circumstances persons making complaints against police officers might lay themselves open to prosecution for criminal libel or conspiracy to pervert the course of justice.
      I have stated the existing practice and the reason for it. Let me say that an opportunity now exists—as envisaged by the hon. Gentleman—for this practice to be discussed and examined within the police service. This—and no doubt other questions also touching on the position and protection of a police officer involved in a complaint—will be among matters which will come before the Working Party of the Police Advisory Board, which has been set up by my right hon. Friends the Home Secretary and the Secretary of State for Scotland. It is clear that the task of the Working Party will involve an extensive review of the complaints procedure as a whole.
      The Working Party includes representatives of the Police Federation as well as of the chief and other senior officers and the local police authorities. In short, the Working Party contains a body of expertise and experience on the kind of question which has been covered in our debate tonight.
      The Police Federation has already indicated that it would welcome any change that would permit something less than the present exhaustive and formal procedures in the case of malicious or frivolous complaints, such as we have been talking about. It has, in particular, raised the question of enabling an accused officer to have the facilities—which it is to be assumed would mean

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      giving the accused officer a copy of the letter of complaint—to take civil action against a complainant in appropriate cases.
      I am sure that the hon. Gentleman will agree that the appropriate course will be that this matter should for the moment be left for consideration by the Working
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      Party, and that it can be taken for granted that the working party will have due regard for all the views that have been expressed in this debate.
      Question put and agreed to.
      Adjourned accordingly at two minutes past Eleven o'clock.