HC Deb 09 August 1972 vol 842 cc1709-10
13. Mr. Frank Allaun

asked the Secretary of State for the Environment if he will make a further statement on the Government's declared intention of reducing by up to £200 million a year the council housing subsidies which would have otherwise been paid by 1975 under the present system.

The Minister for Housing and Construction (Mr. Julian Amery)

The Government never declared an intention to reduce housing subsidies by any specific amount. We have estimated that the effect of the provisions of the Housing Finance Act, 1972, will be to maintain subsidies at about their present level, or, in my latest judgment, somewhat above.

Mr. Allaun

Does not the right hon. Gentleman recall that on two occasions in the Chamber the Government stated precisely what I have set out in the Question? Is it not unjust to reduce such potential subsidies by a single penny when the Government, quite rightly, last year raised the relief to owner-occupiers from £300 million to £340 million a year?

Mr. Amery

I am sure that the hon. Gentleman does not want to misrepresent the situation. All I was trying to explain on previous occasions was that the reorganisation of the subsidy system, which will concentrate subsidies on people and areas in need, will leave subsidies maintained at about or somewhat above their present level.

Mr. Crosland

May we clear this matter up? Is it not within the recollection of the House that the Chancellor of the Exchequer, in the mini-Budget of October, 1970, stated that he expected a saving of £200 million in 1975–76 compared with what would otherwise have been the case? Is it not within the recollection also of all members of Standing Committee E that similar figures were given by the Minister himself more than once in those proceedings? Will the right hon. Gentleman now give his present estimate as compared with those estimates of the likely savings in 1975–76?

Mr. Amery

The right hon. Gentleman will appreciate that what I have been at pains to correct is the suggestion that the declared intention was to make this saving. [HON. MEMBERS: "It was."] It has never been, and I thought that the right hon. Gentleman had long ago abandoned the idea that the object of the Housing Finance Act was to save money. That has never been its object. The object has been to reconcentrate subsidies where they are needed. As I have said, my estimate is that subsidies will remain at about or somewhat above the present level.

Mr. William Hamilton

Deliberately or otherwise, the right hon. Gentleman is misleading the House. Does he not recall that the White Paper on public spending issued by the Chancellor in October, 1970, stated in terms that the saving would be between £100 million and £200 million a year on housing subsidies as compared with what they would have been if the Labour Government's subsidies had been continued? Will he now say what the current estimate is?

Mr. Amery

We have merely pointed out that the more rational and equitable subsidy system on which we are embarking happens to result in between £100 million and £200 million less than the old inefficient system would have produced, but this is not the motivating force behind the Act. What we are trying to do is to help people and areas in need.

Mr. Crosland

If it was not at least the original motivating force behind the Bill, why on earth was the new housing policy declared not by the Secretary of State or the Minister but by the Chancellor of the Exchequer in the context of a money-saving autumn Budget?

Mr. Amery

It was set out at great length in a statement by my right hon. Friend the Secretary of State, then Minister of Housing and Local Government, and elaborated in the White Paper "Fair Deal for Housing", as the right hon. Gentleman will recollect.