HC Deb 15 February 1973 vol 850 cc1467-95

Amendments made: No. 2, in page 3, line 6, after 'for', insert 'not later than'.

No. 3, in page 3, line 7, leave out '1st' and insert 'on 29th'.—[Mr. Channon]

Mr. Freeson

I beg to move Amendment No. 4, in page 3, line 11, leave out 'being a qualified person within the meaning subsection (12) below'.

Mr. Speaker

With this amendment it will be convenient to take the following amendments:

No. 5, in page 3, line 16, leave out 'being a qualified person within the meaning subsection (12) below'.

No. 6, in page 3, line 33, leave out from 'him' to end of line 35.

No. 8, in page 4, line 3, leave out paragraph 10.

Mr. Freeson

The purpose of the amendments is to widen the scope for rent allowances under the Bill, a matter which was discussed at some length in Committee and referred to on Second Reading and to which we wish to return in view of the arguments put forward by the Government against our proposals in Committee. On studying those arguments in the printed record, we find them unsatisfactory.

In statistical terms, one might summarise the effect of the Bill as being to make about 120,000 furnished tenants eligible to apply for rent allowances, in addition to the 120,000, approximately, who are in receipt of rent allowances by way of supplementary benefits. Setting aside those who are already in receipt of rent allowances by way of supplementary benefits, we are talking about all the rest of the furnished tenants throughout the country. The Minister, in Committee, said that the Bill would provide for 120,000 more furnished tenants to become eligible.

The total number of furnished lettings in the country is estimated by the Government to be about 600,000. I think that the figure is nearer 700,000, but we will not quarrel about that today. There are about 100,000 receiving rent allowances from the Supplementary Benefits Commission. That leaves about 500,000 furnished tenants who do not receive and are not eligible for rent allowances under the present law. According to the Minister, 120,000 additional tenants will become eligible to claim for rent allowances when the Bill becomes law.

That leaves approximately 380,000 furnished tenants who will get no benefit. and it is to those tenants that our amendments are addressed, as similar amendments were addressed in Committee. We consider this to be an unsatisfactory situation. We have already expressed the view that even in general terms the Bill is unsatisfactory because it does not tackle homelessness and insecurity as it should have done. I have called it a paltry Bill. Setting aside the argument that the Bill should have gone much further, when one considers the figures of eligibility for rent allowances the Bill becomes even more paltry than we thought; 380,000 out of nearly 500,000 furnished tenants will continue to remain ineligible for rent allowances.

Unless the Bill is changed, we shall end up with the majority of furnished tenants not being eligible for rent allowances, despite the great parading by the Government of their intentions, hopes and desires. In London, which has the largest number of furnished tenancies, the Minister has said there are more than 250,000 furnished tenancies. I believe the figure to be higher—nearer 300,000 to 350,000.

According to the figures which the Government have made available in answer to Questions in the House, there are between 16,000 and 20,000 furnished lettings with rents registered each year. If we allow for movement out of their existing lettings of persons who have been to rent tribunals, a reasonable "guesstimate" is that about 150,000 at most of the 250,000 actually have registered rents.

According to studies made by the Francis Committee, out of a sample of 100 tenants who had been to rent tribunals about 80 were not to be found in their accommodation a year later. I am speaking from memory here as I have not referred to the figures recently. If that represents fair sampling, it indicates that the current number of registered rents is very low compared with the number of furnished lettings.

If, as the amendment suggests, we were to extend the scope of rent allowances based upon the local authority's assessment of fair rents in consultation with rent officers, this would increase the number of applications and referrals to rent tribunals. As we have argued extensively, most furnished tenants are fearful of going to rent tribunals or reporting their rent problems to local authorities. It usually ends with their getting notice to quit, if not immediately, within six months to a year or, at most, 18 months. Despite that, there would be some increase in the number of referrals to rent tribunals either directly by tenants or via local authorities. This in itself is a good reason for extending the scope of rent allowances, because it would bring more clearly to the tenants themselves and local authorities evidence on the situation on rents in their area. They would see that there are a large number of excessive rents operating in their area, and as a result a proportion, at least, of these would be likely to end up by being considered by a rent tribunal, with beneficial results at least of a limited kind.

4.30 p.m.

The consequences, therefore, of extending the rent allowances eligibility that we are putting forward in these amendments and increasing the number of referrals to rent tribunals of excessive, or allegedly excessive, rents would be, first, greater use of their rights by citizens living in these situations in central city areas; secondly, more reasonable or fair rents being registered via rent tribunals; thirdly, more information becoming available to local authorities about their local conditions—and there is certainly great need for information in this field; fourthly, more action by local authorities to get reasonable rents registered; and, fifthly, more action by local authorities to get unhealthy conditions of disrepair rectified.

Sixth, and finally, I come to the point we will not be able to debate anywhere near as fully as we would have wished in view of the selection of amendments to which I referred earlier. Where landlords threaten eviction as a result of applications for rent allowances resulting in referrals to rent tribunals along the lines I have suggested, greater pressure would be put upon local authorities to purchase the properties in question, improve them and hold them in the rental market, where at present they are being sold out of that market at the cost of considerable insecurity to many families and individuals, and all that goes with that insecurity in people's homes.

Those are the six main points of policy which I hope all of us would agree as being sound objectives: a larger number of referrals to rent tribunals of excessive rents, greater use of rights, more action by public health inspectors as a result of information coming in, more action by local authorities in tackling cases of threatened insecurity by purchasing properties in appropriate cases, and consequently greater security, and the holding of a larger rental market in areas where that is being constantly eroded as a consequence of insecurity of tenure and as a consequence, therefore, of the selling out of that market.

I would hope that these broad objectives, however we might seek to achieve them, will be acceptable to both sides of the House. They are certainly acceptable, anyway, to those on this side. What are the objections? These were discussed in detail in Committee. The Minister argued briefly on Second Reading and more extensively in Committee that if we were to enlarge the scope of rent allowance eligibility along the lines we are urging in these amendments, as we did in Committee, it would introduce greatest pressures on the market and, in particular, it would introduce greater pressures in the inner city areas on families living in furnished accommodation, who must have first priority in any help that is to be given by legislation.

When we pressed the Minister on this the only argument he put forward, the only illustration he gave, was that these greater pressures would put more families at risk in the inner city areas if we introduced rent allowances for all, or virtually all, tenants of furnished accommodation, since this would be an inducement to single people to group together to occupy flats at high rents with which they would be assisted, and that this would put greater pressures on the market so far as families were concerned and drive them out of certain dwellings into an even smaller pool of accommodation. This was his main, and, in fact, his only argument in regard to pressures on the market.

Mr. Arthur Latham (Paddington, North)

So that we can get the record straight, could my hon. Friend make clear that when he is referring to rent allowances for all furnished tenancies he means making all furnished tenancies eligible under the scheme? There is a very important distinction. There might be some validity in the Minister's argument if those applications were granted automatically, but they are subject to a stringent means test before qualifying. We are talking only of initial eligibility.

Mr. Freeson

That is fair and valid point, and I thank my hon. Friend for his intervention. I must be careful in the phraseology I use. We are speaking about people who, under the Bill as drafted, would be eligible to apply; and if the Bill were amended as we would wish, larger numbers of people could be eligible to apply; not that they would all be in receipt of rent allowances after applications had been considered.

The only argument pursued by the Minister in Committee to illustrate his anxiety about not introducing greater pressures by extending the scope of rent allowance eligibility was the fact that it would be an artificial inducement for single people like secretaries, students and others—advertising executives were quoted in Committee—to club together to pay high rents and be assisted with those high rents, thereby making for less accommodation for families in those areas. At a later stage in our proceedings the Minister went on to speak against any easing of the residential qualification for which we had argued, that is, the six months' residential qualification that one must have, in general, before one may apply for a rent allowance—if one sets aside for the moment the discretion on hardship cases that the Bill gives to local authorities.

The Minister went on to argue that the abolition of the six months' residential qualification—and this was the only illustration he gave in Committee—would encourage people to move from outside London or other big cities to stress areas where there was a problem of shortage of accommodation in the furnished sector, which, again, would add to the pressures on families. Answering his second point first, we said in Committee that we did not accept it, and I suggest again that it is a nonsense argument, and that to suggest that a rent allowance would induce a family to move from Glasgow or from any of the high unemployment areas of the country into the London area is just to fly in the face of the facts.

Many of us represent areas—I certainly do—of high unemployment from which homeless families come to London bringing their family with them, or having their family join them soon afterwards, and running into serious difficulties with accommodation. That is happening now, but the pressures are at the other end, in lack of employment opportunities where they come from rather than the existence or non-existence of rented accommodation. This aspect is so marginal as to be a nonsense in considering it as a factor in the situation. We must pay far more concern to the mobility of families in considering this question of the six months' residential qualification. The Francis Committee has referred in detail, as have others who have looked at the question of homelessness in our cities, to this question of mobility and of people moving constantly from one place to another.

The Government fail to point out, as was made clear in the Greve Report on Homelessness in London, published a little over a year ago, that for many families a high rate of mobility means not that the family moves from furnished accommodation into unfurnished accommodation but that many families stay within the furnished sector and constantly move within it—in other words, they move from one inadequate and socially insecure furnished tenancy to another. Therefore, to adhere to the six-months' residential qualification will put at risk a large number of families who the Minister has said he wants to help in the Bill.

It is not enough to say that there is discretion for local authorities to deal with hardship cases or to say that a local authority such as Brent should use its discretion when receiving a family from Camden. There should be no query or uncertainty in people's minds, for it will be a disincentive to people who already suffer from far too many disincentives in asserting their rights in face of the conditions in which they live. The eligibility should apply as of right. I made this point in Committee. I believe that the Government should accept that the period of residential qualification should be based on the minimum period considered by the local authority associations to be administratively acceptable. The time scale should be laid down in the Bill.

The Minister argued that the fact that single people share accommodation may drive out families and that the situation may be hampered by the introduction of rent allowances on a broader scale. That suggestion also is a bit of a nonsense, and it does not stand up if we examine what is happening in the inner city area. How many secretaries and advertising executives, bearing in mind the joint income that they enjoy, does the Minister think will apply for a rent allowance? Does he think that widening the scope of rent allowances will make any marked impact on the situation in the inner city areas? I find it difficult to believe, and I have seen no evidence in the form of feasibility studies and all the rest on which to make such an assertion.

Many of those who are already sharing accommodation may need help. I refer to students, apprentices and trainees who club together to take accommodation in the inner city area while they are training or studying. They need housing assistance. To refuse them help is to leave unanswered the question of where that help should come from in terms of housing resources and to avoid the question of examining whether it might be done by way of more generous education grants. Whichever way the problem is dealt with, help is certainly needed. The whole subject of the housing of students and of single people should be taken on board by the Department of Environment under the wing of the Minister for Housing and Construction.

The dichotomy between the Department of Education and Science and the Minister for Housing and Construction over the question of student accommodation is foolish, does much damage and holds up progress. There is a specific need for help to be given to students who are living in furnished accommodation.

4.45 p.m.

I would ask the Minister to look at Schedule 3, paragraph 12(1)(b). He will see that under the existing rebate and rents allowance scheme in furnished accommodation deductions are given in respect of non-dependants for each week for each person aged 21 years or more but under pensionable age and neither undergoing full-time instruction at an educational establishment nor in receipt of supplementary benefit and the figure there set out is a deduction of £1.50.

It would be feasible for the Minister when a flat is occupied by four or five single people to write into the Bill the necessary qualifications, or disqualifications, to meet the point which he says he is concerned about, if indeed the point has any validity. If he feels that there will be pressures to obtain an additional inducement by means of rent allowances, the Bill could be amended to provide that such persons would not be classified as dependants so that the head tenant, as it were, among a group could claim rent allowance when there was already a good income in that dwelling. I see no difficulty over this point, and I see no substance to the Government's argument.

I return to the matter of policy objectives. If we sought to enlarge the scope of rent allowances, it would give the opportunity for local authorities to refer more cases to rent tribunals when they had information about exorbitant rents in their area or information about bad living conditions. In that way a large number of fair rents could be registered.

When we raised this matter in earlier stages of the Bill, we were not given a satisfactory reply from either the Minister or the Under-Secretary of State for the Environment. We argued that when tenants, because of fears and anxieties, were reluctant to take action themselves, the responsibility should be undertaken by local authorities. The Under-Secretary of State said that it was a discretion that did not have to be used, and when we asked the Minister whether it was right that local authorities should use their powers when they had information before them he said that local authorities must act in the best interests of their tenants.

I do not know what that reply was supposed to mean. Did it mean that if local authorities feared evictions they should not refer cases to tribunals, or did it mean that they could refer the cases on the basis of information about rent allowances? If an eviction is threatened, surely the local authority, with full ministerial backing, should undertake purchase of the property to protect the tenants and to ensure that the law is applied fairly. That is what we would wish to see, which ties up with our general approach of linking the question of security with the question of rent allowances—but this is not for discussion today because of the selection of amendments. We would wish to see a link established wherever possible between the application for rent allowances, the referral of exorbitant rents to rent tribunals to make sure that reasonable rents were being applied and, where there were threats of eviction or pressure for people to get out as a result of the referral of bad cases to rent tribunals, action by the local authority.

I put it on record here, whatever the Minister may say—and I hope local authorities, and certainly those which are governed by Labour Party majorities, will take note—that they should make it their business to organise their local authority departments in such a way as to ensure that, where rent allowances are applied for and it is found that exorbitant rents are being paid, and would continue to be paid even with the rent allowances unless there were referral to a rent tribunal, referrals are undertaken by their legal departments, by information about the high rents being passed to the housing department or the treasurer's department, so that when it comes to their notice that, as a consequence of the decisions of rent tribunals fixing lower rents, landlords seek to get rid of their tenants, the local authorities move in and buy the properties up.

This would do three things. It would encourage more furnished tenants to apply for rent allowances, which I am sure the Minister wants, because they would not have so much fear about the consequences; it would ensure more reasonable rents being charged; and, thirdly, it would ensure that the rental market was being held instead of being eroded away by people being priced out of the accommodation and property passing into owner-occupation or some commercial activity. This is our central point, and these are the main reasons why we would wish to see also an extension of the eligibility for rent allowances along the lines we have argued in our amendments.

Mr. Julius Silverman

I support the amendment in the names of my hon. Friends and myself. I shall not detain the House long because I believe the House is anxious to get to the stratosphere very shortly.

The Bill provides a basis for rent allowances which is quite different from that of the rent rebates for council tenants and the rent allowances for people in furnished accommodation. As far as rent rebates for council tenants and rent allowances are concerned, the situation is simple: the qualification is based upon a means test. We do not like the means test, but if one is going to have a rebate scheme that is obviously the only way one can do it. The Bill provides a means test plus, because first there is to be the means test to decide the amount of the rebate, but a person has to be a qualified person. In addition to the means test, he must be able to prove hardship, and, in addition to that, there is a residential qualification.

We are asking the Minister why this difference is necessary. The Minister has a case to prove. I am bound to say that in Committee the Minister did not begin to prove this at all. Usually the Minister is clear and cogent in his arguments; even if we do not agree with him, there is no doubt about his clarity; but here I am bound to say that he produced no case whatever to justify this.

Why is this necessary? Why should not the unfurnished tenant qualify in precisely the same way as a person in a furnished tenancy or a person living in a council house? Is it that there are going to be large numbers of unfurnished tenants standing at the door of the council house and costing the ratepayer and the Government large sums of money? Experience does not show that, and we have some experience.

We have experience of this in Birmingham, about which the Under-Secretary of State for the Environment knows. Birmingham has been operating a scheme for several years. I have mentioned it before in the House, but I make no apology for doing so again. It is an allowance scheme for private tenants, which includes not only unfurnished tenancies but furnished tenancies. Since 1st October it has been operating the Government scheme—that is to say, in relation not only to rent rebates but to rent allowances—instead of its own regional scheme, which means that until 1st December this would be at the ratepayers' expense. This again has included furnished tenancies without any of the qualifications contained in this Bill, and the total number of people who have been granted allowances so far, out of an estimated number of 18,500 unfurnished tenancies, is 20. So the whole thing really is ridiculously small and there are not large numbers, although none of these qualifications has applied.

This makes me wonder what on earth is in the Government's mind and why it is necessary to have this apparatus, this paraphernalia, with the Government making orders and giving guidance to the local authorities as to the various categories. Why are these necessary at all?

My hon. Friend the Member for Willesden, East (Mr. Freeson) has mentioned what I said in Committee, but the only case the Minister mentioned was the case of several people clubbing together. As he pointed out, this is a nonsense because already, as the Bill now stands, with £1.50 on every other resident in the house who is not a student or an old-age pensioner, there will not be any rebate for these people at all anyway. Supposing there are people who club together and are in hardship; why should they not get the benefit? Why all this paraphernalia just in order to disqualify perhaps a few applicants? It does not make sense at all. The Minister must justify this or look at it again to see whether, even at this late stage, he cannot exclude this from the Bill. The most it would mean is that perhaps a few hundred people would qualify who might not otherwise do so. Why is it necessary to complicate the Bill to do this?

The problem for the Government is going to be the low take-up in this particular case, not that of spending large sums of money, and obviously this will diminish the take-up even further. This provision in the Bill is really a piece of nonsense and unnecessary. The residential qualification again will probably reduce the number of people who are entitled to this and could benefit from it. Why should it be six months? I and my hon. Friends appreciate that there must be some residential qualification; one cannot have a man changing his residence every month, for instance, and going to the council every time he does so and asking it to re-assess the amount of rebate to which he is entitled; but I would have thought that a month or six weeks would be a suitable residential qualification as far as this is concerned. Six months is far too harsh. The present qualification provision is unnecessary. I do not believe that it will result in any large expenditure if it is removed, and I ask the Government to look at this again.

5.0 p.m.

Mr. Ronald Brown (Shoreditch and Finsbury)

I too would like to support my hon. Friends. The Government have made a big thing out of introducing this rent allowance but in the small print they are mitigating the effects of what they set out to do. Many of us have encouraged people to take advantage of these allowances but now it seems that some of these people will find themselves out of court. It will be hard to explain to them that the Government have mounted this enormous publicity exercise, saying that they want to help everyone in need, and yet have deliberately inserted qualifications which they must realise will reduce the chances of such people being helped.

How many people are we talking about? The Department must have done some sort of exercise on this. It must know how many persons throughout the country are expected to be in this category It must know exactly how much it will cost I hope that the Minister can tell me.

Mr. Freeson

The Minister had this information elicited from him in Committee. If we exclude those already receiving rent allowances by way of supplementary benefits, there will, according to the Minister, be probably 120,000 persons eligible. That will leave about 380,000 persons in furnished lettings ineligible.

Mr. Brown

I am grateful to my hon. Friend and am anxious that those figures should be on the record. That is something about which we can argue all night. I do not accept that it is reasonable to bring in allowances and then deliberately to debar people from applying for them. I hope that we can look again at this. It seems that out of the total number of people who could be helped the Minister is prepared to help only one-third, assuming that they do not get caught in this device he has produced.

I support my hon. Friends on the subject of the residential qualifications. Furnished tenancies present great problems. My constituency suffers greatly because there are so many of them. People are frequently being turned out of them, and it is almost impossible to cope with the housing difficulties because of the number of homeless families being picked up from the streets, having been turned out of furnished accommodation. Every time I try to get people rehoused I am told that it is impossible mainly because others have been turned out of furnished accommodation. Many such people turn to the council, and when they cannot get help there they have to take the first thing that comes along in furnished accommodation. Within months they are turned out of that.

These people are in need of and are entitled to our help. It is no fault of theirs that the landlords are conspiring to do this, under the Government. The Government are allowing them to do it; they could stop it if they wished. They have brought forward these allowances, and it is incumbent upon them to make certain that all those in furnished accommodation are allowed to claim and have that claim decided.

Mr. Channon

It is pleasant to have the lion. Member for Shoreditch and Finsbury (Mr. Ronald Brown) joining our debates. He asked one or two questions to which, as the hon. Member for Willesden, East (Mr. Freeson) pointed out, I have given the answers. I will give them again in due course. It is not quite fair to say that those answers were elicited from me. I believe that I volunteered them. I will volunteer them again.

The hon. Member for Birmingham, Aston (Mr. Julius Silverman) said that the onus was upon me to prove my case. I am not so sure about that. The important thing is that we should do nothing in this Bill that will damage the interests of families living in furnished accommodation. The proposition that flows from that is that if there is any doubt about what is the right course to take the benefit of the doubt must be given in favour of not taking action that might possibly damage the interests of families.

As I understand the Opposition case, it is that there should be no qualifications at all, provided the usual financial ones are met, for any category of furnished tenant applying for rent allowance. As I pointed out to the House during the Second Reading debate and in Committee, I am afraid of doing anything that would increase the pressure on furnished accommodation beyond that which now exists. I would not want to do anything which would make the position of families living in furnished accommodation even marginally more difficult.

All we are doing, if we pass this Bill, is to set up an initial system. If experience shows that the Government have been too restrictive in the categories they have put forward, there are plenty of opportunities for increasing those categories later. That could be done by order. There is no need for a Bill. I undertake to lay such an order if that is any guarantee to hon. Members. If experience shows that those initial categories are too restrictive, I guarantee that we will come forward with further categories at the appropriate moment.

Mr. Freeson

That is not a meaningful guarantee unless we are told that there will be a report back within a specific period of time. We have heard time and again, not from the hon. Gentleman but certainly from his predecessor, that certain matters, dealing with this subject would be put to the House in due course. The Francis Committee is a good example. There have been no legislative proposals arising from that report laid before the House yet the Committee reported 18 months ago. How can we accept that assurance in the light of such a state of affairs?

Mr. Channon

I do not think it is very fair of the hon. Member to say that. The Francis Committee's report is highly controversial. Parts of it are welcomed by the Opposition; parts of it are bitterly detested by them. A similar position exists on these benches. Parts of it we support; about other parts we have grave doubts. It requires a complicated piece of legislation. The hon. Member has been in Government, perhaps longer than me—

Mr. Clinton Davis (Hackney, Central)

Longer than I.

Mr. Channon

I apologise to the hon. Member for Hackney, Central (Mr. Clinton Davis) whose grammatical skill is well known to the House.

The hon. Member for Willesden, East knows that there is all the difference in the world between producing controversial legislation and finding time to put it before the House. There cannot be any dispute about that.

I return to my initial point, that as we are beginning on this road it is better to increase later, rather than go too far at first, find that we might have put too much pressure on families and then have to retract. I undertake that if experience shows that the Government are being too restrictive we will come back and seek the advice of the Advisory Committee on Rent Rebates and Allowances which I am hoping will be set up in the reasonably near future.

In case the hon. Member for Shore-ditch and Finsbury or other hon. Members not deeply involved in the details of the Bill have not quite taken in all the categories of people who will be eligible for rent allowances, I must make it clear that the first thing that local authorities will have the right to do is to give rent allowances to people who, they believe, are in hardship.

Mr. Julius Silverman

Any person who comes within the category of the means tests already applied, such as council house and unfurnished tenants who are given rent allowances has to prove means, and those means amount to the fact that it would be hardship for him to pay his rent.

Mr. Channon

I am coming on to deal with the details of the categories of people entitled to rent allowances. Anyone who is in real difficulty will be able to apply for an allowance. If a local authority considers that an applicant would suffer hardship if no allowance were granted, it will have a duty to grant one.

Mr. Thomas Cox (Wandsworth, Central)

I have been listening with great interest, and I am sure that the rent allowances will be of some assistance. The hon. Gentleman in his opening remarks said that he wished to do nothing that would prejudice a tenant living in furnished accommodation. With great respect, the Bill is extremely limited in the help it offers. There is no reference to the obligation of the landlord. I realise that security. However, there is no obligation we are not allowed to comment on to repair all furnished tenancies. In the constituency which I represent that is a continuous problem to be faced. These are the kind of issues with which we hoped the Government would deal, thereby giving great help to the people we seek to help.

Mr. Channon

The hon. Gentleman may be right. Maybe we should come forward with wide housing legislation to deal with some of the points he has in mind. Throughout, I have made no great boasts about the Bill. It is a modest measure designed to give rent allowances to furnished tenants. I have never made any extravagant claims for the Bill. But I believe that it will be of great value to the occupiers of furnished tenancies.

Mr. Clinton Davis

The hon. Gentleman is obviously reposing great confidence in local authorities. One knows from experience that certain local authorities take a hard line about homelessness and that others take a liberal line. Is it not a reasonable inference to draw from this situation that whereas in a liberal area like Hackney the local authority might——

Mr. Dennis Skinner (Bolsover)


Mr. Davis

It is Labour but liberal with a small "1". Hackney is likely to take a reasonable attitude about these matters. Is it not also likely that an area like Richmond, which does not even fulfil its obligations towards homeless families, will take an altogether different attitude? Is it not wrong to leave such wide discretion to local authorities?

Mr. Channon

I do not accept what the hon. Gentleman says. He seems to suggest that the discretion of local authorities should be removed, that the central Government should lay down a rigid system and that only the central Government can tackle the problem. If the hon. Gentleman wants me to have more power and the Hackney Borough Council less, I will consider the matter. I doubt whether he will find that proposition very popular. I do not accept the proposition he puts forward.

I shall now explain again to the House the categories of people——

Mr. A. W. Stallard (St. Pancras, North)

The argument posed about hardship sounds, to say the least, a bit unreal. Many of the people in my constituency are in very great hardship, particularly the categories mentioned. The biggest hardship is to find furnished accommodation because of the policies being pursued by the Government. Is the hon. Gentleman aware that the Government's policies are making it impossible for anybody, certainly in St. Pancras, North, to find furnished accommodation?

5.15 p.m.

Mr. Channon

I do not accept that. It has been pointed out that the amount of furnished accommodation in London is increasing. I do not think that it is increasing in Central London, but there is no doubt that overall the amount of furnished accommodation is increasing. I accept that the situation is unsatisfactory. I have never denied that. We could have a long debate about the whole housing problem of London and the difficulties of getting furnished accommodation, but the Bill merely seeks to give rent allowances to tenants living in furnished accommodation.

The Opposition appear to be arguing the case that all those in furnished accommodation should qualify for rent allowance——

Mr. Freeson

Not all of them.

Mr. Channon

All who qualify on financial grounds. The hon. Member for Aston was fair enough to point out that there should be a residential qualification, though he says that six months is too long. [Interruption.] I took down his words. He said "There has to be some residential qualification." The hon. Member for Willesden, East thinks that we are wrong about six months.

Mr. Freeson

We are both at one in that we say that the period of waiting should depend purely on administrative grounds. The idea of a six months' residential period has nothing to do with the administrative problems involved. I had in mind one month to six months.

Mr. Channon

The hon. Member for Aston seemed to suggest that there should be some qualification, but not as long as six months.

I have naturally considered carefully all that hon. Members said on Second Reading and in Committee about qualifying categories. I still remain unconvinced, at the start of this scheme—which we all know has been very difficult to bring into effect, which is one of the reasons it has not been done before—that hon. Members' proposals are right.

We would be in danger of causing some hardship to families in the centre of London I think it would he wrong for me to proceed along those lines. I think I am right in saying that nearly one in two of all tenants of furnished accommodation are families. If I am right, we would be increasing the pressure on furnished accommodation in the stress areas of London. The Opposition say that I am wrong and that it would cause no further pressure on furnished accommodation. I find it hard to understand how anyone can argue that. If there is any extra inducement to people to occupy furnished accommodation, automatically there must be some extra pressure. Therefore my approach of being more selective and trying to help families more than anyone else is to be preferred, since they would be put at some risk if the blanket approach for which some hon. Members have been arguing were adopted.

We have agreed that anyone who would otherwise suffer hardship should qualify. The local authorities have asked for guidance in this matter although they have discretion to decide. Certain categories of tenants will be eligible for an allowance as of right: families with dependent children, including single-parent families, who have been resident for six months in the local authority's area—a period which the hon. Gentleman regards as unsatisfactory. Also, old-age pensioners or tenants who are or have a registered handicapped person living with them or whose household includes a pensioner who meets this residential qualification would automatically be included. Single tenants and couples with no dependent child or pensioner living with them would qualify after a longer period of residence in the local authority's area, and probably also if they fell within an age limit. I have mentioned these categories in the House previously.

I will, without any commitment, look again at the question of six months and whether it is too long. I also intend to include the registered handicapped and those who have such a person living with them as a category to be prescribed in the regulations to qualify for an allowance as of right. In Committee the hon. Member for Paddington, North (Mr. Latham) questioned whether the registration procedure was relevant and appropriate.

The local authority will—in any event, as I have said—grant an allowance to any furnished tenant whom it considers would suffer hardship if he did not get an allowance. My right hon. Friend will give guidance, in a circular, to local authorities about the tenants who in his view should or might be regarded as cases of hardship. There will be consultation with the Department of Health and Social Security and with the local authority associations before the guidance is issued.

When it comes to assessing hardship the local authority will be under no restriction regarding residence, age or household composition. I think it was the hon. Member for Aston who said that if that was the position, why bother to do it? That argument cuts both ways. The Bill is drafted in a flexible way. The categories of those who are eligible as of right can be altered and added to as necessary in the light of experience. There is no reason why the original categories should be inflexible. I am anxious to make help available quickly to all those who are hardest pressed.

If something is to be done quickly—I think the House is keen on that—it is essential not to overload local authorities, especially the inner London boroughs and Birmingham, which have very large numbers of furnished lettings in their areas. Some of these authorities are very concerned about their capacity to take on this work. All this points to making a restricted start without jeopardising the position of those in real need. As the evidence becomes clearer, we can go further at a later date.

The hon. Member for Aston has pointed to the figures of take-up for Birmingham. I have not got them with me today. However, I do not dispute what he said about them. He knows Birmingham better than I do. I do, however, have the figures for Bromley, which is an interesting example of a London borough.

Mr. Thomas Cox

It is not representative of the housing problem in Wandsworth.

Mr. Channon

It is an interesting example of a borough with a large number of private unfurnished tenants even if it is not similar to the hon. Gentleman's constituency. It is estimated that there are 8,000 private unfurnished tenants in Bromley. There have already been 3,200 applications from those tenants, of which 1,200 have so far been granted. Bromley began its rent allowance scheme on 1st October 1972. That is fairly encouraging.

I accept that it is crucial to increase the take-up. I accept that it will be difficult. I am still examining what the right hon. Member for Grimsby (Mr. Crosland) said on Second Reading, for instance, about having field officers. It is an interesting and constructive suggestion which I shall explore. However, I accept that it is essential that we should do our utmost to increase the take-up.

The hon. Member for Willesden, East raised the question of a family moving from one stress area to another—say, from Camden to Brent. If a family which has been getting an allowance in Camden moves to Brent, the Government's view is that it should be regarded as likely to suffer hardship if it does not get an allowance in Brent. I think that meets the hon. Gentleman's point. I cannot believe that local authorities will not act on that guidance.

Mr. Freeson

This is an important though narrow point. I should like to put two points to the Minister on what he has said. He quoted an example of a Camden citizen moving across the boundary into Brent coming within the guidance on hardship and, in the Government's view, being entitled to continue with a rent allowance. First, would a person moving from Aston into Camden or Brent who had previously qualified for and been receiving a rent allowance be entitled to continue with a rent allowance under this guidance?

Secondly, would a person living in borough X who, had he applied, would have qualified for a rent allowance and who moves to borough Y be entitled to apply straight away and obtain a rent allowance? I suggest that it should not depend solely on whether he has exercised his right in his previous accommodation. He might he moving into more or equally difficult circumstances than those from which he had come. It should not depend on whether he had taken up his right in a previous borough before being eligible to apply and to be considered under the hardship rules in the borough to which he had moved.

Mr. Channon

The first point is quite clear. If someone is in receipt of a rent allowance and he moves from one part of the country to another, the guidance will say that, prima facie, he will suffer hardship if he does not get a rent allowance in the other borough providing his circumstances regarding income and other relevant characteristics remain unchanged.

On the second point regarding someone who notionally could have been entitled to a rent allowance but did not apply and what his condition would be if he moved to another borough, I shall have to think about that. But in all these cases the local authority has a discretion to grant a rent allowance to people who are in real difficulty.

The hon. Member for Willesden, East, both in Committee and in the House, asked about the power of referral to rent tribunals. Under Section 72 of the 1968 Act local authorities have power to refer rents to rent tribunals. The powers are discretionary so that local authorities can act in the best interests of the tenants. That is why, in Committee, I said that local authorities must act in the interests of the tenants.

It is hard to see how the central Government could be better placed than local authorities to reach a view on the best interests of tenants in any area. I think that local authorities can be trusted to do what they believe to be in the best interests of the tenants of their area. Local authorities will have to consider this matter when the rent allowance scheme comes into effect. I shall want to watch the operation of the system closely in the light of what happens. I do not think that any local authority has made representations about potential difficulties on this aspect of managing the rent allowance scheme. I have not had any representations that this is likely to cause any problem for local authorities.

I believe that it is wiser for the House at this stage in the proceedings, entering into a completely uncharted sphere, to start in a modest way and to move to a more advanced scheme in the light of experience. I do not want to do anything which might increase the pressure on furnished accommodation and damage the interests of families in furnished accommodation. I hope that no one in this House will advocate anything that might make the position of families in furnished accommodation more difficult than it is.

For those reasons I believe that we should concentrate the help, which rent allowances can give, to the categories which I have outlined. I hope, therefore, that the House will not accept the amendment but will allow the Government to proceed in the way I have described.

Mr. Bruce Douglas-Mann (Kensington, North)

The Minister in his opening speech said that he did not know that it was for him to prove his case regarding the amendment. I think the House will agree he has not done so. We have been waiting for him to give us examples of circumstances in which the pressure on furnished accommodation would be increased as a result of making all those who would be eligible on income grounds eligible within the terms of the Bill. The hon. Gentleman has not done that. We had some illustrations in Committee, but they were mostly fatuous examples. We cannot conceive of any circumstances in which people will gather together to claim rent allowances in the furnished sector in such a way as to cause any significant increase in the demand for furnished tenancies which could not be met by measures which the Government could easily adopt if they were not already provided in Schedule 3 to the Housing Finance Act.

5.30 p.m.

As it stands, the Bill is in any event a one-legged measure which, without the necessary complement of security of tenure, cannot achieve the object which it is repeatedly said in the House we wish to achieve. We may not discuss security of tenure. The amendment is an attempt to provide the other leg or at least to provide a crutch. Unless the Government accept the amendment we shall be unable to introduce effective alleviation of the hardship to low-income tenants in furnished accommodation in stress areas.

We know from experience that any means-tested measure involves the problem of low take-up. The Minister has quoted figures for the take-up of rent allowances in Bromley, but the qualification for rent allowances is solely a matter for income. I am sure the Minister will know, because he has had to try to approve the publicity for it, that the terms upon which allowances are made available under the Housing Finance Act are complicated enough. Every hon. Member has had to explain them to constituents and has found it difficult to determine whether someone is eligible for an allowance or not.

Now, when dealing with tenants in furnished accommodation under the Bill, we have to consider not only the income and the occupational elements of the rent, as adjusted by the provisions of the Act, but we must also determine whether the tenant falls into one of the various categories and, if he does not, whether the hardship is such that the local authority might in its grace decide to make an allowance. In practice people will not apply. These matters nearly always depend upon word-of-mouth contact. If someone knows that the person next door has got the allowance and is able to ascertain that he too is eligible, he will make an application for it. If on the other hand he finds that someone next door applied but after an exhaustive procedure was turned down, he will not apply. The case for including all those who would be eligible on income grounds is therefore very strong and the case against doing so is negligible.

We have heard of far-fetched examples but no concrete suggestion has been made of any circumstances in which the pressure on housing could be significantly increased by such an inclusion. The increased pressure on housing has resulted from measures deliberately taken by the Government, primarily through the Housing Finance Act, and because house prices and furnished rents are excluded from the freeze. That has been the cause of the growing pressure in stress areas. It has not been caused by a group of highly-paid people clubbing together and, because the rent is so high, possibly making themselves eligible for a rent allowance.

The categories of those who were eligible were put forward by the Minister on Second Reading when he said that one category was all families with children including all single-parent families who have been living in the local authority's area for at least six months". —OFFICIAL REPORT, 23rd January 1973; Vol. 849, c. 235.] Earlier today the Minister said that if people had been eligible for an allowance and they moved to another local authority area, assuming that the conditions were the same they would continue to be entitled to an allowance, presumably under the hardship category. But the conditions would be unlikely to be the same. First, the rent would necessarily be different to some extent and in all probability the tenant would have moved to find work.

The other argument advanced by the Minister in Committee against extending rent allowances to all who would be eligible on income grounds was that to do so would be to encourage mobility of labour into the stress areas. But the movement would be not only into but also out of those stress areas. If a family could leave North Kensington and find housing accommodation in Hastings or another part of the country where there was less housing stress, they would not know until they arrived whether they would be eligible for an allowance. This is one of the major difficulties because the family would not know without travelling to Hastings and asking the local authority, and without having been there for some time whether they would be eligible. To travel that distance is an expensive business for someone on a low income.

Even if this were to add to the possibility of someone moving out of an area in the North where there was no work and coming to London where there was work, is the Minister saying that he would deprive such people of the benefit when they were moving into an area where rents would necessarily be driven up because other people were being subsidised? The Government must accept that if they subsidise some people, prices will necessarily rise. Under the present system people in council housing, those in private unfurnished accommodation and some low-income tenants in private furnished accommodation are subsidised. To leave out a few low-income families, which is what the Bill seeks to do, is to ensure that these families will suffer greater hardship than they would have done if the Bill had not been passed.

The Under-Secretary of State for the Environment (Mr. Reginald Eyre)

Will the hon. Member concede that the points he has been making illustrate the in-

creased pressure in stress areas that could arise as a result of people moving into them with the benefit of the proposals in the Bill? Is that not a good reason for therefore giving the benefit to families as the Government propose?

Mr. Douglas-Mann

The Minister is suggesting that there should be no subsidies because subsidies increase the pressure of demand. No doubt a good case could be made to that effect. If, however, there are to be subsidies, to exclude one small category which would be entitled on income grounds is to create more hardship for that sector than if there was no help at all. The addition of this minute section—perhaps 1 per cent. of 1 per cent.—will not result in increased demand. A difference might arise from higher take-up but not from increasing the number of those qualified. Increased demand has been created by the measures contained in the Housing Finance Act. Tenants in privately rented accommodation will be expected to pay more rent and the expected return on property is rising as a result. Therefore the value of property is rising. The Government knew that this would happen and they acted deliberately to make it happen.

The Bill as it stands is a small, useful measure. The Minister described it as a modest measure but I would describe it as a small, mean measure which partially creates a serious injustice. Our amendment would at least ensure that the correction of that injustice was complete. There would still be grave problems of take-up and it would still be an inadequate measure without security of tenure. But our amendment would ensure that the majority of those who were in need would be eligible for help. They would know that they were eligible and the Bill would therefore be more significantly beneficial than it is.

The Opposition propose to press the amendment to a Division. I hope that the House will support it.

Question put, That the Amendment be made:—

The House divided: Ayes 120, Noes 143.

Division No. 57.] AYES [5.41 p.m.
Atkinson, Norman Bishop, E. S. Bradley, Tom
Barnett, Guy (Greenwich) Blenkinsop, Arthur Broughton, Sir Alfred
Benn, Rt. Hn. Anthony Wedgwood Booth. Albert Brown, Ronald (Shoreditch & F'bury)
Carmichael, Nell Jay, Rt. Hn. Douglas O'Halloran, Michael
Carter, Ray (Birmingh'm, Northfield) Jenkins, Hugh (Putney) Orme, Stanley
Castle, Rt. Hn. Barbara John, Brynmor Oswald, Thomas
Concannon, J. D. Johnson, Carol (Lewisham, S.) Padley, Walter
Corbet, Mrs. Freda Johnson, Walter (Derby, S.) Palmer, Arthur
Cronin, John Johnston, Russell (Inverness) Pannell, Rt. Hn. Charles
Crosland, Rt. Hn. Anthony Jones, Dan (Burnley) Pardoe, John
Cunningham, G. (Islington, S.W.) Kaufman, Gerald Parker, John (Dagenham)
Oalyell, Tarn Kerr, Russell Pavitt, Laurie
Darling, Rt. Hn. George Kinnock, Neil Pendry, Tom
Davidson, Arthur Lamborn, Harry Perry, Ernest G.
Davis, Clinton (Hackney, C.) Lamond, James Prentice, Rt. Hn. Reg.
Davis, Terry (Bromsgrove) Latham, Arthur Prescott, John
Deakins, Eric Lawson, George Roberts, Rt. Hn. Goronwy (Caernarvon)
de Freitas, Rt. Hn. Sir Geoffrey Leadbitter, Ted Rodgers, William (Stockton-on-Tees)
Douglas-Mann, Bruce Lee, Rt. Hn. Frederick Roper, John
Edelman, Maurice Leonard, Dick Rose, Paul B.
Edwards, Robert (Bilston) Lipton, Marcus Ross, Rt. Hn. William (Kilmarnock)
Ewing, Harry Lomas, Kenneth Sheldon, Robert (Ashton-under-Lyne)
Faulds, Andrew Lyon, Alexander W. (York) Shore, Rt. Hn. Peter (Stepney)
Fisher, Mrs. Dorls (B'ham, Ladywood) Lyons, Edward (Bradford, E.) Short, Rt. Hn. Edward (N'c'tle-u-Tyne)
Fletcher, Ted (Darlington) Mabon, Dr. J. Dickson Short, Mrs. Renée (W'hampton, N.E.)
Foot, Michael McCartney, Hugh Silkin, Rt. Hn. John (Deptford)
Freeson, Reginald Mackie, John Silverman, Julius
Gilbert, Dr. John Mackintosh, John P. Skinner, Dennis
Ginsburg, David (Dewsbury) Maciennan, Robert Spearing, Nigel
Grant, John D. (Islington, E.) Marquand, David Stallard, A. W.
Griffiths, Will (Exchange) Marshall, Dr. Edmund Steel, David
Grimond, Rt. Hn. J. Mayhew, Christopher Summerskill, Hn. Dr. Shirley
Hamilton, William (Fife, W.) Meacher, Michael Tuck, Raphael
Harper, Joseph Meillsh, Rt. Hn. Robert Wellbeloved, James
Harrison. Walter (Wakefield) Millan, Bruce Whitlock, William
Hattersley, Roy Mitchell, R C. (S'hampton, lichen) Williams, W. T. (Warrington)
Heffer, Eric S. Molloy, William Wilson, Alexander (Hamilton)
Hooson, Emlyn Morgan, Elystan (Cardiganshire)
Horam, John Morris, Alfred (Wythenshawe) TELLERS FOR THE AYES:
Houghton, Rt. Hn. Douglas Morris, Charles R. (Openshaw) Mr. John Golding and
Hughes, Robert (Aberdeen, N.) Moyle, Roland Mr. Michael Cocks.
Janner, Greville
Adley, Robert Foster, Sir John McCrindle, R. A.
Allason, James (Hemel Hempstead) Godber, Rt. Hn. J. B. McMaster, Stanley
Amery, Rt. Hn. Julian Goodhew, Victor Macmillan. Rt. Hn. Maurice (Farnham)
Astor, John Gray, Hamish McNair-Wilson, Michael
Alkins, Humphrey Green, Alan Marten, Nell
Awdry, Daniel Griffiths, Eldon (Bury St. Edmunds) Mason, Rt. Hn. Roy
Baker, Kenneth (St. Marylebone) Grylls, Michael Maude, Angus
Batsford, Brian Gummer, J. Selwyn Maudling, Rt. Hn. Reginald
Berry, Hn. Anthony Hannam, John (Exeter) Maxwell-Hyslop, R. J.
Biffen, John Harrison, Col. Sir Harwood (Eye) Meyer, Sir Anthony
Biggs-Davison, John Haselhurst, Alan Mills, Stratton (Belfast, N.)
Blaker, Peter Hastings, Stephen Moate, Roger
Body, Richard Hawkins, Paul Molyneaux, James
Boscawen, Hn. Robert Heseltine, Michael Money, Ernie
Bowden, Andrew Hicks, Robert Monks, Mrs. Connie
Bray, Ronald Holland, Philip Monro, Hector
Brlnton, Sir Tatton Holt, Miss Mary More, Jasper
Brocklebank-Fowler, Christopher Hordern, Peter Murton, Oscar
Brown, Sir Edward (Bath) Hornby, Richard Neave, Airey
Bruce-Gardyne, J. Hornsby-Smith. Rt. Hn. Dame Patricia Owen, Idris (Stockport, N.)
Channon, Paul Howell, David (Guildford) Page, Rt. Hn. Graham (Crosby)
Churchill, W. S. Howell, Ralph (Norfolk, N.) Parkinson, Cecil
Clarke, Kenneth (Rushcliffe) Hunt. John Percival, Ian
Clegg, Walter Hutchison, Michael Clark Pike, Miss Mervyn
Cooke, Robert Iremonger, T. L. Price, David (Eastleigh)
Coombs, Derek Jenkin, Patrick (Woodford) Pym, Rt. Hn. Francis
Corfield, Rt. Hn. Sir Frederick Jessel, Toby Quennell, Miss J. M.
Cormack, Patrick Jopling, Michael Ralson, Timothy
Costain, A. P. Kellett-Bowman, Mrs. Elaine Ramsden, Rt. Hn. James
Crouch, David Kilfedder, James Redmond, Robert
Crowder, F. P. King, Evelyn (Dorset, S.) Reed, Laurance (Bolton, E.)
Dixon, Piers King, Tom (Bridgwater) Ridley, Hn. Nicholas
du Cann, Rt. Hn. Edward Kinsey, J. R. Rossi, Hugh (Hornsey)
Elliot, Capt. Walter (Carshalton) Knight, Mrs. Jill Rost, Peter
Eyre, Reginald Knox, David Russell, Sir Ronald
Farr, John Lamont, Norman Sinclair, Sir George
Fell, Anthony Lane, David Soref, Harold
Fenner, Mrs. Peggy Langford-Holt, Sir John Spence, John
Fidler, Michael Le Marchant, Spencer Sproat, Iain
Fisher, Nigel (Surbiton) Lewis, Kenneth (Rutland) Stanbrook, Ivor
Fletcher-Cooke, Charles Longden, Sir Gilbert Sutcliffe, John
Fookes, Miss Janet Luce, R. N. Tapsell, Peter
Taylor, Frank (Moss Side) Tugendhat, Christopher Whitelaw, Rt. Hn. William
Taylor, Robert (Croydon, N.W.) Turton, Rt. Hn. Sir Robin Woodhouse, Hn. Christopher
Tebbit, Norman Vickers, Dame Joan Worsley, Marcus
Thatcher, Rt. Hn. Mrs. Margaret Waddington, David
Thomas, John Stradling (Monmouth) Walder, David (Clitheroe) TELLERS FOR THE NOES:
Trafford, Dr. Anthony Ward, Dame Irene Mr. Tim Fortescue and
Trew, Peter Weatherill, Bernard Mr Marcus Fox.

Amendment accordingly negatived.

Amendments made: No. 7, in page 3, line 38, leave out not later than 1st 'and insert ' on 29th'.

No. 9, in page 4, line 44, leave out 1st' and insert '29th'.—[Mr. Channon.]

Motion made and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed.