HC Deb 05 May 1970 vol 801 cc171-2
2. Mr. Hooley

asked the Minister of Housing and Local Government if he will consider introducing an effective interest rate of 2½per cent. on local authority borrowing for new housing limited to authorities which have the gravest slum clearance and housing need problems.

Mr. Freeson

In present circumstances my right hon. Friend cannot contemplate even more generous housing subsidies. The basic subsidy for new building is now running at several times the level under the previous administration and amounting to about £3 per week for each dwelling completed.

Mr. Hooley

While recognising the great contribution that this new subsidy system has made, under which Sheffield, for example, last year received more than £2 million in the housing revenue account, may I ask my hon. Friend whether he agrees that there is a case for extending the admirable precedent set by the educational priority areas and the urban programme of giving special aid to those great industrial cities which have inherited serious problems from former Tory and Liberal administrations?

Mr. Freeson

My hon. Friend will appreciate that to some degree we have already started along this road because in 1966, for the first time, we established a list of housing priority areas where the greatest possible effort will be made, if need be restraining other authorities in their programmes, to get the resources in the right places. How we might in future more effectively assist the social priority areas is a matter that we are still studying.

Mr. Kenneth Lewis

As the hon. Gentleman has just said that he cannot do anything about this in present circumstances, will he tell us what circumstances would enable him to do something about it? In view of the fact that at the last General Election the Labour Party promised 3 per cent. mortgages, will the Government partly redeem that promise by doing something for the slum dwellers by getting the borrowing rate down?

Mr. Freeson

With the greatest respect, the hon. Gentleman is confusing two issues. On slum clearance, this Government have increased the rate by about 25 per cent. since the last Government left office. On assistance to local authorities, we have under the 1967 Housing Subsidies Act, introduced an effective interest rate level of 4 per cent. for public authority housing. As for the future, we have a major housing finance review under way in the Department.