HC Deb 06 December 1972 vol 847 cc1586-600

6.24 a.m.

Mr. Alec Jones (Rhondda, West)

Earlier this morning, many hours ago, my hon. Friend the Member for Merthyr Tydvil (Mr. Rowlands), who has soldiered on with me throughout the night, drew attention to the threat which the proposed new town of Llantrisant would be to the prosperity and to the possible survival of our valley community in South Wales. I am talking not only about my constituency but about my home. Its future depends upon creating a sound industrial base so that sufficient job opportunities can be provided not only for the people who are now unemployed, but so that we can retain the young people instead of seeing them forced to move to other parts of the United Kingdom by the high and long-lasting unemployment in these communities.

But apart from job opportunities there are other aspects of our daily lives in these areas which need the Government's urgent attention. That is why I have chosen to raise this subject in this morning's rather curtailed debate. Decent homes are not only necessary for those who now live in the valley communities of South Wales and other towns in the area but are necessary as inducements to new industry to come to Wales. That is an illustration of how housing policy affects an area.

The White Paper, "Fair Deal for Housing", said that one of the Government's housing objectives was a decent home for every family at a price within their means;". Many of us in Wales and other parts of the United Kingdom regard those words as a sick joke when we look at the present position of many aspects of the Government's housing policy. No one can suggest that the picture is encouraging, for we see rising house prices which, as the Minister for Local Government and Development has just indicated, are causing such great concern. Rents are escalating and there is a slow-down in house building.

It is true that there is one bright spot—the increasing number of improvement grants being made available. But even here there is fear in some quarters that much of the money may be going to property speculators instead of to those who need it most. The Government, by sticking stubbornly to the June 1974 deadline for the final date for paying the 75 per cent. grant, are creating considerable difficulties, anomalies and injustices.

House purchase is dear to the hearts of most Welshmen. In my constituency this is illustrated by the fact that 70 per cent. are owner-occupiers. This desire to be independent, to be free of the rent collector and to get rid of the property speculator is prevalent in Wales. But young couples anxious to set up their homes are being priced out of the market. The year 1972 is becoming the year of the gazumper. Throughout Wales, increases of hundreds of £s are taking place between the first offer made by a young couple and the final settlement.

I have some figures from a neighbouring constituency illustrating the situation. In September 1971 a two-bedroomed semi-detached bungalow was up for sale at £3,995; eight months later it was being sold for £4,995; on a two-bedroomed detached bungalow there was an increase of £1,045 in the same eight months; a three-bedroomed semi-detached bungalow increased in price by £1,445 over the same period.

These massive increases are making home ownership beyond the reach of many of our young people. It is now estimated that the typical Welsh house-buyer, if he is lucky enough to earn even £41 a week, has to make mortgage repayments of £38 a month, which represents 21.4 per cent. of his income. That is a high percentage of the family income, quite apart from rates and other payments. It is a heavy strain on any family man, even if he is fortunate enough to have that income. But it is a burden that many young people have to carry far many years. For those on lower incomes, home ownership is becoming almost impossible, particularly if they desire, as so many young people naturally desire, a modern home. The Secretary of State for Wales on 29th November told the House that the average price for a new house in Wales in September 1972 was £5,471, a 20.5 per cent. increase on the figure for September 1970.

Who is responsible for this? The Government usually tell us to look at the trade unions, who are calling for excessive wage increases. Or they say it is the rising price of building materials, beyond their control. Why, then, have prices of second-hand houses rocketed to the same extent? No wage increases have been paid to the people who built them, nor have extra costs for materials been incurred. The average price for a secondhand house in Wales is now £5,452, which represents a 26.6 per cent. increase on 1970 prices. These figures were given to the House by the Secretary of State for Wales.

What affect will the Housing Finance Act have on rents? The Government have a stock reply—that it is too early to assess its effect or that the figures are not centrally available. This is not good enough. If the fears we have expressed are unfounded, then it is up to the Government to prove it by collecting and publishing the facts and figures.

Some of the figures which are emerging are far from reassuring. We are told the Act will bring untold benefits to massive numbers of council tenants. I have managed to get the figures from the Newport borough, where they have some 11,000 council houses. Of the 11,000 tenants, 3,600 claim rebates, yet 2,500 of the 3,600 had previously been in receipt of supplementary benefit in rent allowances. So this means that only 1,100 benefit, and of these some 600 were previously receiving rebates under the Newport authority's own rent rebate scheme. So in this large borough it comes down to merely 500 new claimants. I believe that these figures can be repeated up and down Wales. Of 2,800 applications for a rent rebate in my constituency of Rhondda, 2,000 were in receipt of supplementary benefit rent allowances. If all the additional claims were allowed there would only be some 800 more receiving rebates.

I ask the Government for a detailed statement on the working of the rents Act in Wales. If I can get the figures for Rhondda and Newport, the Government can get them from most of the other local authorities in Wales.

The White Paper "Fair Deal for Housing" said the object was to create fair rents between one citizen and another in giving and receiving help towards housing costs. When the Chancellor of the Exchequer announced the cut in Government subsidies for house building in October 1970, one of the declared purposes was to reduce the level of Government subsidies to local authorities. That meant that council tenants were to receive less help from central government towards their housing costs. Yet in a parliamentary reply on 4th December this year it was quite clearly indicated that the tax relief on mortgage interest to owner-occupiers is increasing. The figures for the United Kingdom are: in 1968–69 tax relief for mortgage interest was £195 million; 1969–70, it rose to £235 million; in 1970–71 it rose to £300 million, and by 1971–72 to £340 million. On the one hand we see subsidies to council tenants going down and on the other hand we see the tax relief on mortgage interest going up. I am not suggesting that these tax reliefs should not be given, but I am suggesting—and I think that most fair-minded people would agree—that we should treat council tenants and owner-occupiers equally fairly.

I should like the Minister—not now, perhaps, but by letter—to give the comparative figures for Wales so that we may see how unfairly the so-called "Fair Rent" Act is affecting council tenants in Wales. May we have the figures to show the drop in subsidies for council house building and the increase in mortgage tax reliefs for owner-occupiers?

The house-building programme is probably the most disastrous of all. We have had a slump from the peak figure of 20,158 in 1967 to 15,101 in 1971. I think that I am fair, perhaps over-generous, in saying that the estimate for 1972 is still about 15,000, a considerable fall from the 20,000 in 1967. The Minister may console himself by saying that alongside the 15,000 figure, private house building is up. Nobody denies that, but the balance is now completely distorted, because the fall in council house building has been only partly met by increased private building.

More important is where the private houses are being built. Are they being concentrated in the towns of great need, or concentrated in the more salubrious areas of South Wales such as Llantrisant, the Vale of Glamorgan and so on. How will the building of private houses help the 1,264 people on the waiting list of the Rhondda Borough Council? I am not suggesting that private building should not take place, but it must be at least matched by an increase in council house building.

I have previously asked questions about the 75 per cent. improvement grant. Increasing the amount to 75 per cent. was an excellent idea and a fortnight ago the Minister gave figures to show that the increase from 50 per cent. to 75 per cent. had been of considerable value. But I warn him that his enthusiasm is likely to turn sour. I give an example from the Rhondda to show what has been happening.

In the past 10 years in Rhondda we have issued 4,363 grants costing £1½ million—at the old 50 per cent. rate. That means that our building force in Rhondda can cope with about 400 applications for home improvements a year. We now have 2,500 applications in the pipeline. Our building force has extended itself and is now dealing with some 700 applications a year. But it has now reached saturation and cannot cope with any more.

The 2,500 pending applications will provide work not only for our own building force but for builders coming to the valley from outside, for 3½ years, and that does not account for the applications coming in month by month. We have more than enough applications to keep us going far beyond June 1974. Thus, many of the 2,500 individuals whose applications are in the pipeline will be disappointed—and more than disappointed. Many will be unable to afford the improvements that they need if we are forced to revert to the 50 per cent. rate after June 1974.

The people likely to be left behind are the elderly, the disabled, the widow who lives alone, the person who has no contact with a builder, who does not go about a great deal. These are the people who now are having difficulty in finding a builder to do their work, and they are the very people who are likely to be left behind if the date is not put forward. I urge the Minister to press on his right hon. and learned Friend the importance of this matter so that it may be taken up in the Cabinet.

I have sought, briefly because of the hour, to draw attention to the major defects in the Government's housing policy as it affects Wales. Although we shall welcome a reply from the Minister of State, what we want is Government action to tackle the problems and provide the necessary remedies.

6.41 a.m.

Mr. Elystan Morgan (Cardigan)

I support with enthusiasm the case which my hon. Friend the Member for Rhondda, West (Mr. Alec Jones) has so powerfully presented. I congratulate him on his choice of subject, for there is no matter among all those we have debated today of greater human importance than housing, touching, as it does, the life of the individual, of the family and of the community.

The Government's housing record is dismal throughout Britain, but in Wales it is more miserable than it is in any other part. The Minister has on other occasions sought, with his usual panache, to put a brave face on it, but, for all the sleight of hand which can be practised with statistics and all the misrepresentation in the selection of data, there is no controverting the basic facts, which clearly show that there is no comparison between the record of this Administration and the infinitely superior record of its Labour predecessor.

In the five years up to 1970, the Labour Government built, on average, 18,000 houses per annum in Wales. In the five economically easier years up to 1964, the average achieved by the then Conservative Government was 13,000. If the present Government's housing record is no more than to equal in virtue that of their predecessor, they must improve on those totals—if I may indulge in an Irishism.

Three factors make that necessary: first, the continuing increase in population; second, the fact that people are marrying younger and forming family units sooner; third, what was described in a wider context by the late President Kennedy as the revolution of rising expectations.

Since 1970, the Government's performance has been more in line with the pre-1964 performance than with that of the Labour Government. As my hon. Friend has shown, the Government will be lucky if they are able to build 15,000 houses in Wales in 1972. I doubt that they will reach that target. In the first six months they built 7,315 houses. That is the number of completions. Of those, 5,089 were in the private sector and only 2,226 in the public sector. This is a point which must be hammered home. In terms of the public sector 1972 has at the moment every appearance of being the most unsuccessful year since the end of World War II. One has to look at these figures against the background canvas of the very special needs of Wales in relation to housing.

Perhaps the House will bear with me if I quote some figures for 1970. There has not been a very great change in the situation since then. Out of our stock of houses in Wales, 220,000 had no indoor we; 165,000 were without a fixed bath; 226,000 were without a fixed wash basin. Over 55 per cent. of our houses are over 50 years old, comparing very badly with 45 per cent. of houses in the north of England which are over 50 years old, and 35 per cent. in the Midlands.

I accept what my hon. Friend said. It is true that the Government have disbursed very substantial sums by way of improvement grants. It is fair for them to acknowledge that in so doing they have continued the work so splendidly begun by the previous Administration under the Housing Act 1969. The point has been touched upon by my hon. Friend that some of these monies expended on improvement grants are squandered in situations where there is no justification for such expenditure. I refer to the giving of grants to persons who use them merely to improve the condition of weekend cottages which are second or third homes for them.

There is in Wales, understandably, a feeling of fury in relation to what is taking place. I am not referring to the pseudo-racialist attitude taken by a minority of people who object to those coming from the Midlands. I refer to the attitude of ordinary people who say it is a misallocation of public funds to use them for purposes of private luxury and pleasure.

The Minister of State, Welsh Office (Mr. David Gibson-Watt)

Is the hon. Member saying there was no such fury when improvement grants were made under the previous Administration?

Mr. Morgan

The Minister makes a fair point. The legal provision for the payment of those grants was contained in our Act of 1969. When that measure was debated, as the right hon. Gentleman will agree as one who took part in the discussion, it was never envisaged by any hon. Member of this House that there would be a racket in the misallocation of funds such as I have described. I do not think any blame could be attached to Parliament for passing that excellent piece of legislation. But the time has come to face up to a situation that has developed very rapidly over the past 12–18 months. We have evidence before us of abuse of public funds which is unjustified. Indeed in a country such as Britain, with over 3 million people living in houses of such a standard as to give them an environment that is intolerable, there is an element of evil in using limited, scarce public funds for such purposes.

There has been frequent reference to the Housing Finance Act. I believe that the Act bears more heavily upon Wales in proportion than it does upon any other part of the United Kingdom. Nearly 40 per cent. of the people in Wales live in council houses and housing will therefore be a very much greater burden for hundreds of thousands of families because of the Act. It does nothing to answer the basic problems which confront housing. It is unnecessary and it represents a strategic change in the Government's thinking on assistance. A point that the Government sedulously sought to conceal is that while at the moment, taking every form of assistance into account, the total sum paid by the Treasury each year for assistance amounts to about £470 million to £480 million, by the middle of 1975, with the full operation of the Act, that sum will have been reduced to about £250 million. In other words there is a withdrawal of between £200 million and £220 million from that substantial subvention.

Labour Members have been daunted many times by the cavalier attitude adopted by the Secretary of State and the Minister of State about housing. There is no question of their having any strategy for housing. They do not seem to have any conception of the special needs of Wales and they have no idea of the magnitude of the challenge that confronts them. They seem to pride themselves on having a complete ignorance of the basic facts. My hon. Friends and I have asked questions on many occasions in the last 12 months but we have failed on each occasion to elicit information about the matters which are vital to an understanding of the problem. On 13th March I asked the Secretary of State whether he would ascertain the number of persons who were in serious need of rehousing in Wales. On 19th April I asked for details of the numbers of people seeking council houses and on 8th May I asked what machinery existed for notifying the Welsh Office of serious housing needs throughout Wales.

Throughout the replies, which are duplicated in answers to my hon. Friends, there ran a recurrent theme. The Minister had no statutory obligation, it was a matter for the local authority, and it was not an appropriate question for the Minister to consider. How can the Government build a policy without the raw material of the knowledge of the fundamental facts? He does not know and he does not want to know. The Secretary of State indulges in a wilful self-induced blindness and such blindness is the negation of the stewardship which he owes to the Welsh people. He has used the same blindness over the Housing Finance Act. We have had no information of the crushing effect that this will have upon the hundreds of thousands of families in the Principality.

The Government have made great play of their success in the private sector of housing. I have carefully studied the statistics of the last 10 years and the improvement that they have managed to achieve in private housing is not all that considerable compared with the figures returned during the Labour Government's term of office. But private sector housing can never answer the problem of the Welsh people. In my constituency we have the coincidence of the lowest income per head and the highest prices. Very few of the 13,000-or-so wage and salary earners in my constituency are in a position to buy the average house. More than three-quarters of them are thousands of pounds away from being able to buy the average house.

It is, therefore, trite to say that any development in the private sector can answer that basic problem. Since the Government have chosen to provide fewer and fewer public sector houses, many people in Wales are condemned to a future of being unable to get a house of decent standards. Building societies, as I know well from my experience as a solicitor before I went to the Bar, will not advance more than about two-and-a-half to three times the basic salary of the husband applicant, and that means that many people are completely debarred from buying a new house.

We on the Labour side are not obsessed with the question of building council houses but we believe that in Wales the situation can be answered only by the provision of very substantial quantities of new council houses. It was a Labour Government through the Leasehold Act 1967 who were responsible for making over 300,000 persons in Wales owners of the freehold of their properties, persons who would have had no title to that property nor any estate in the land when the lease expired, were it not for that pioneering and radical legislation. We accuse the Government not so much of bungling and ineptitude but of having a philosophy which is the perma-frost of prejudice, which withers every possibility of conceiving of planning in the economy for the benefit of the community generally.

They think of a house as though it were a chattel, just like a motor car or a pair of shoes, the provision of which must be regulated entirely by un-trammeled and unconfined market forces. We must get the facts of housing needs. The Government cannot hide behind their blindness any longer. They must also give us the quantum of the allocation of improvement grants for second homes.

At the same time we also want some accurate statement of the effects of the Housing Finance Act on the people of Wales. The Secretary of State from time to time represents himself in Wales as our interceder in the Cabinet, who champions our Principality against the competing claims on the Government, as against other sectors. He gives the impresion that he did that on the Housing Finance Bill. If he did, he must have put some facts before the Cabinet, and if that is so these facts should be given to the Welsh people if democracy is to have any meaning, with a comprehensive plan of the Government's strategy for the future.

All this, with Government calculations, should be published in a comprehensive White Paper. Only by that will the Government acknowledge the challenge. They must not delay further in this matter.

7.3 a.m.

The Minister of State, Welsh Office (Mr. David Gibson-Watt)

By leave, I will speak again.

The hon. Member for Rhondda, West (Mr. Alec Jones) opened this debate in his customary way and probed carefully into the problems of Welsh housing. I shall address myself to most of those questions.

I was a little confused with the hon. Member for Cardigan (Mr. Elystan Morgan). He started by commending me for panache, and that was the very first time that anybody here had suggested that I had that quality. He went on to say, however, that we were suffering from a cavalier attitude towards housing. I reject that entirely. He has not provided a tot of evidence that this is so. During his speech, the hon. Member said that under the previous Government there were difficult years. Certainly they were difficult years, but he went on to say that there were now easier years. Indeed these are. This Government handle the economy a great deal better than did the previous Government.

Since the war, government, builders, housing associations and individuals have played their part in improving the stock of houses in Wales which are essential to our people. In broad terms, needs are changing from a gross shortage with overcrowding, as stated by the right hon. Member for Cardiff, West (Mr. George Thomas), in 1970 to a situation in which greater emphasis can be placed not only on the needs of special categories in the community such as old people and handicapped people but on the improvement and regeneration of individual areas.

Mr. Elystan Morgan

How can the Minister possibly say that the overcrowding situation has been improved when he and his right hon. and learned Friend admit that they have no idea of the number of persons who are applicants for rehousing in Wales? How can he admit, on the one hand, that he has no knowledge of the basic facts, and on the other, with absolute certainty state that the situation has improved?

Mr. Gibson-Watt

If the hon. Member will allow me to get on with my speech, I shall do my best to explain that.

There are large old houses which fall short of modern amenities and attractive environment. I am aware of the legal problems, to some of which the hon. Gentleman has referred. Some authorities have difficulty in getting labour to improve houses to within the yardstick levels. I realise that this is a problem, particularly in areas which find that they have too many three-bedroomed houses and need to build smaller units of one-and two-bedroomed houses. While I am not prepared to advise my right hon. and learned Friend to agree to a general increase in the yardstick levels, I would be prepared to consider individual cases on their merits and would agree for particular schemes to allow higher yardstick levels. If the hon. Gentleman has any particular case in mind, he may like to advise the council that it should seek discussions with the Welsh Office. I can assure him that the cases will be considered sympathetically.

I appreciate the difficulties facing Rhondda and other councils in having to take awkward decisions between the clearance and the improvement of older houses. It is very easy for those outside local government to say what ought to be done, when they do not have to bear any responsibility for the decision. It is a heavy responsibility to have to decide whether to order the demolition of someone's home, no matter how unfit it may be as a house.

The Government are concerned to bring about the improvement of as many houses as can be improved. That is why we introduced more generous improvement grants, and why we are extending the time limit for 75 per cent. improvement grants in assisted areas, which include the whole of Wales, to June 1974. I know that that does not go quite as far as the hon. Gentleman would like. But it is a great improvement on the situation some months ago, and the extension is very welcome.

The House will be aware—both hon. Members were generous enough to refer to it—of the great success achieved in house improvement. Only last week I was able to give the figures. Discretionary and standard grants in both the public and the private sectors totalled 20,429 in the first nine months of this year, compared with 7,870 in the same period last year.

The improved improvement scheme has been so successful that some councils feel that the pressure is so great on their staff and builders that it should be further extended beyond 1974. As the Housing (Amendment) Bill is on its way through the House, I do not think that this is the time for me to debate that point, which the hon. Gentleman raised at Question Time recently.

It is not possible to improve all houses that are unfit or nearly so. While I appreciate the difficulties, I must emphasise that there comes a time when a house that is unfit must go, and there are areas of unfit houses which should be cleared. This is a problem that has to be faced, and councils cannot avoid it simply by deciding that they will not clear unfit houses but will rely on improvement. The Government appreciate the problem, and have been very aware that the compensation generally awarded has not been entirely satisfactory. That is why we announced in the White Paper, "Development and Compensation—Putting People First", our intention to introduce a better compensation code, including home loss payments and, where unfit houses are cleared, a doubling of the rate of well-maintained payments. I think this will be welcomed. The new rate came into operation on 30th November this year.

I shall be understood by the House when I speak of the problem of the "rotten tooth" house in a terrace of good, sound houses. This is one of the most difficult problems facing many older towns, particularly in the South Wales valleys. When houses like this in the middle of a terrace are demolished, the houses on either side are put at risk. They are each left with a wall that may not be safe, that will let in the damp. It is not particularly helpful to tell these householders that the person whose responsibility it was to demolish the bad tooth house is also responsible for making sure that the ends of their houses are left safe and sound. Too often he cannot be traced.

Rhondda Borough Council has been looking into the possibility of solving the problem of rebuilding in the gap, or, where it is the end house that has gone, at the end of the terrace. I understand that it has had some discussions with housing associations to see whether they can help. It has also written to the Welsh Office seeking to explore the possibility of financial assistance if it should do the work itself. Officials of the Welsh Office will be happy to meet the council's officers to discuss the whole problem and to see whether we can co-operate to find a solution, because a problem definitely exists.

In the general housing field it is true to say that by 1970, under the previous Government, in spite of the figures given by the hon. Gentleman, the house-building programme was already declining. The pressure of demand in local authority house building was easing off, and the demand for houses for owner-occupation was being artificially restrained, particularly by the restraint on local authority mortgage finance. Under this Government, in the private sector, the easing of restrictions on local authority mortgage finance and the greater availability of mortgage finance generally has been of great benefit to those seeking to own their own homes. Completions and starts of private houses continue to rise—a 17 per cent. increase in completions and a 32 per cent. increase in starts in the first nine months of this year compared with the same period last year.

Those are remarkable figures, and if one adds to the number of houses completed in the private and public sectors the large number of houses which have been given a new life by improvement grants—numbers which I have already given tonight—one sees the real scale of the Government's activity in this field.

I am grateful to the hon. Gentleman for giving me the opportunity to pay credit to all concerned, including the Government, in this advance in the living standards of the Welsh people. We are not complacent. There is much still to do, but improvement continues.