Commons Sitting of 23 January 1973

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  NATIONAL FINANCE

    Income and Taxation
    Mr. Horamasked the Chancellor of the Exchequer if he will give total taxes as a percentage of original income plus cash benefits for a two adult/two child family with earnings of £1,500 a year, £2,000 a year and £4,500 a year.
    The Chief Secretary to the Treasury (Mr. Patrick Jenkin): The most recent family expenditure survey shows that total taxes paid by such a family in 1971 amounted to around 32–33 per cent. of original income plus cash benefits at each of the three levels of earnings. The value of the cash benefits however falls—both absolutely and relatively—as the level of earnings increases.
    Mr. Horam: Does not that show how unprogressive our present system of taxation is? In the light of the Government's appeal for fairness, does not the Chief Secretary think that the onus is on the Government to do something radical about it very soon?
    Mr. Jenkin: The answer shows that in this medium range of incomes the total weight of taxation, both direct and indirect and including all cash benefits, is roughly of the same level. But, of course, it is based on the 1971 family expenditure survey figures and there have been considerable changes since then. Also, the figures encompass a very considerable range of incomes around each average and therefore the figures should be treated with a good deal of caution.

    Economic Growth
    Mr. William Hamiltonasked the Chancellor of the Exchequer what progress has been made towards an annual growth rate of 5 per cent.
    Mr. Eadieasked the Chancellor of the Exchequer if he is satisfied that his target of 5 per cent. economic growth in the economy is being achieved; and if he will make a statement.
    Mr. Norman Lamontasked the Chancellor of the Exchequer what estimate he has made of the effect of the Government's anti-inflation policy on the 5 per cent. per annum growth target.
    The Chancellor of the Exchequer (Mr. Anthony Barber): The latest indicators of demand and output and the falling trend in unemployment suggest that the economy is now growing at a rate broadly consistent with the Budget forecast. Success in reducing the rate of inflation will make it easier to sustain a rapid growth rate.
    Mr. Hamilton: Is not the Chancellor aware that some experts take a contrary view and that some of them are very pessimistic about the present position? Will he give a forecast about the balance of payments deficit for the year arising out of the consumer-led boom which we are now experiencing? Will he explain the reluctance of private investors to invest?
    Mr. Barber: There are other Questions on the Paper concerned with the balance of payments. The Questions now before us deal with growth. There is plenty of evidence to show that the economy is now growing at around the rate which I forecast in the Budget. Industrial production, for example, which is a very important indicator, was nearly 6 per cent. higher in the three months to November than a year earlier. Retail sales are 6 per cent. higher than a year ago and new car registrations are more than 15 per cent. higher. Unemployment on a seasonally-adjusted basis has fallen by 173,000 since March.
    Mr. Bruce-Gardyne: in the event of an apparent conflict between the objective of a 5 per cent. growth and the objective of the abatement of inflation, which would have the greater priority?
    Mr. Barber: I do not believe that the policies we are pursuing are producing any inconsistency whatever.
    Mr. Healey: Is it not the case that the welcome increase in growth in recent months has been largely because Government policies last year increased consumption about three times as fast as national wealth, and was not this one reason for the very heavy deterioration in our balance of payments? Is it not also the case that under the Government's proposals for the coming year consumption will increase at only about one-third of the rate at which they hope to increase national growth? What does the Chancellor propose to do to ensure that the welcome growth we can see at the moment is maintained for the next two years, as the Prime Minister promised the other day?
    Mr. Barber: One of the main reasons for introducing the measures announced by my right hon. Friend last Wednesday, which I hope will have the support of the Opposition in the national interest, was to be able to maintain a more rapid growth rate. I am, however, a little surprised that anyone who supported the Labour Government's policies of restriction and economic stagnation should criticise the present Government on anything to do with the growth rate. The previous Government deliberately held back the growth of the economy to an average rate of less than 2 per cent. a year. It was a disastrous policy and, what is more, the Opposition know it.

    Money Supply
    Mr. Bruce-Gardyneasked the Chancellor of the Exchequer what was the increase in the money supply (M3), expressed as an annual rate, during the latest period of three months for which figures are available; and if he will now revert to the former practice of publishing targets for the expansion of domestic credit over the period of the financial year in course.
    Mr. Patrick Jenkin: In the three months to mid-December M3 increased at an annual rate of about 24 per cent. The latest figures emphasise how right we were to take the measures we have taken recently to moderate the growth of money and credit to rates consistent with our
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    objectives for the economy. In present circumstances I do not think it would be desirable to give hard and fast numerical targets for the expansion of monetary aggregates.
    Mr. Bruce-Gardyne: Is my hon. Friend alarmed by this latest reversal of the slight reduction which we previously experienced in the rate of acceleration in the money supply? To what extent does he think it is related to the Government's public spending programmes coming home to roost, and what relationship is there between this and the phase 2 legislation which we are to discuss later in the week?
    Mr. Jenkin: I can only emphasise what I have already told my hon. Friend: that I think that the December figures, which were to the middle of December, indicated that it was right to have taken the earlier action which was taken and the action which was announced before the figures were made public. I would have thought it would be wrong to place too much emphasis on a single month's figures. Although the trend is higher than it was earlier in the autumn it is substantially below what it was in the summer, and it remains the Government's intention to bring the growth of money supply more nearly into line with the money growth of the economy.
    Mr. Joel Barnett: When the Chief Secretary is talking about not placing too much reliance on one month's figures, he might remind the Chancellor of some of the things his right hon. Friend said on the basis of one month's figures. On the whole question of money supply and public expenditure, as the Government have forecast that public expenditure is to grow next year at the rate of 5·3 per cent., will the Chief Secretary tell us what growth rate he is planning for private consumption?
    Mr. Jenkin: The hon. Gentleman will know that it has been the custom of successive Chancellors to give forecasts of that nature only at the time of the Budget and I will not anticipate my right hon. Friend's Budget Statement. As for the question of the growth of money supply, the hon. Member's point never arose under the previous Administration because they never published monthly figures.
    Mr. Ridley: If the Government are hoping for a rate of growth of 5 per cent. per annum, what is the point of having a rate of growth of money supply which is in excess of that?
    Mr. Jenkin: We have always made it clear that it is Government policy that our stance on money supply should be consistent with the rate of growth my right hon. Friend announced in his Budget Statement. As he told the House last year the rate of growth of money supply was higher than was necessary to achieve that, and we have been running it down. Measures taken recently will reinforce that intention.

    £ Sterling (Value)
    Mr. Ashtonasked the Chancellor of the Exchequer what is the latest value of the £ sterling compared with June 1970.
    Mr. Skinnerasked the Chancellor of the Exchequer what, on the basis of the General Index of Retail Prices, is the purchasing power of the £ sterling, taking it as 100p on 18th June 1970.
    Sir G. Nabarroasked the Chancellor of the Exchequer what is the value of the sterling compared with 1st July 1970.
    Mr. Kaufmanasked the Chancellor of the Exchequer what, on the basis of the General Index of Retail Prices, is the purchasing power of the sterling now, taking it as 100p on 18th June 1970.
    The Financial Secretary to the Treasury (Mr. Terence Higgins): Taking the internal purchasing power of the £ sterling as 100p in June 1970, its value in December 1972, the latest date available, is estimated at 82p. This estimate is based on the movement in the General Index of Retail Prices.
    Mr. Ashton: Is the hon. Gentleman aware that on the last three occasions he has answered this recurring Question the value of the £ has always gone down by 1p per month? When is the freeze supposed to start working?
    Mr. Higgins: I should emphasise that in the December price index period the retail price index rose by about ½ per cent. and that per cent. of that increase was due to higher food prices, partly
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    due to seasonal factors and partly due to the world beef shortage. There was very little increase in non-food prices. It was less than one-quarter of 1 per cent.
    Mr. Skinner: Can the hon. Gentleman tell the House why, in the first month after the freeze, prices were higher than in the preceding month? I am astounded that, when the Minister comes to the Box on numerous occasions to answer this Question, he trots out such phrases as "Things are looking up", "We are turning the corner" and "If we take the appropriate measures things will change." Can he give us a guarantee that as a result of phase 1, phase 2, and the prospect of phase 3 the £ will not fall another 5p under the present Administration?
    Mr. Higgins: I am never astonished that the hon. Member is astounded because he has immediately asked a question which I answered a moment or two ago. He must listen to the answers which are given. I must confess that I do not recognise the remarks which he has attributed to me. The essential thing here is that the Government should introduce the proposals which we have made and which we believe will make a significant contribution—as, from the figures I have quoted, it is apparent the standstill has done.
    Sir G. Nabarro: My hon. Friend has twice mentioned food prices. Has he any proposal to hold food prices in check or is the whole of the freeze exempted from food prices, and the other way round? Are food prices to be taken out of the freeze?
    Mr. Higgins: My hon. Friend will appreciate that if food prices rise on a world basis we as a country have to pay more. Since he has asked a specific question about food I am sure that he and hon. Members opposite will welcome the fact that with the abolition of SET on 1st April there will be a reduction in the tax on food distribution and in other taxes which hon. Members opposite introduced. We are thus reducing the tax on food, in contrast to the previous Government's action.
    Mr. Kaufman: Is the hon. Gentleman aware that in the first month of this fraudulent freeze the pay of a worker on

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    average rates of pay was cut by 15½p a week and the pension of a married pensioner was cut by 5½p a week? Is he proud of that as an achievement? When will the Chancellor abandon his stubborn arrogance and do something about food prices?
    Mr. Higgins: I do not believe that my right hon. Friend is either stubborn or arrogant. The point is that in the 12 months to December 1972 retail prices rose by 7¾ per cent. whereas average earnings increased at least twice as fast. In real terms pensions in December were 11 per cent. higher than in mid-1970 and there was also the extra £10 paid to pensioners. I believe that this answers the hon. Gentleman clearly.
    Mr. Rost: If the Labour Party is really concerned about the fall in the value of the £, why has it consistently opposed a voluntary agreement on incomes in the national interest?
    Mr. Higgins: I hope that hon. Members opposite will adopt a more responsible attitude towards these matters in the future than they have in the past.
    Mr. Healey: Is the hon. Gentleman aware that he has just admitted that food prices went up 1½ per cent. in the first month of the freeze which means an annual rate of increase in the retail price index of 6 per cent.? How can he expect any ordinary working person to co-operate voluntarily in total control of incomes when the Government absolutely refuse to do anything about the appalling rise in food prices?
    Mr. Higgins: I have already given the figures and I rest on them. I am not quite sure whether the right hon. Gentleman heard them correctly. As for the overall position I should make it clear that if world prices rise, as a nation we necessarily have to pay more. Dealing with the proposals for wages and incomes I have already given the position for the 12 months to December. Whereas retail prices rose by 7¾ per cent. average earnings rose at least twice as fast. The important thing is that we should support the measures which the Government are introducing, which will help to cure inflation, will have a significant impact and will benefit the entire country.
    Mr. Sydney Chapmanasked the Chancellor of the Exchequer what is the purchasing power of the £ sterling, based upon the General Index of Retail Prices, assuming it to have been 100p on 6th November 1972; and what it was on 6th December 1972 and 6th January 1973.
    Mr. Higgins: Taking the internal purchasing power of the £ sterling as 100p in November 1972, its value in December 1972, the latest date available, is estimated at 99½p. This estimate is based on the movement in the General Index of Retail Prices.
    Mr. Chapman: I am grateful for that reply. If one makes the assumption that in the last two months there has been an effective fall in the value of the £ of probably 1 per cent., can my hon. Friend tell the House what was the effective fall in the value of the £ in the two months prior to 6th November?
    Mr. Higgins: I am sorry. If my hon. Friend will table a specific Question in those terms I will give a specific answer. The precise position in answer to his question is that the value of the £ on the basis I have described is 99½p.
    Mr. Brian Walden: What I am interested in, and I am sure that the whole House, especially my side, is interested in it, is an answer to a question that has puzzled me for a long time. At the last General Election the Conservative Party promised that the return of my party to power would lead to the "ten bob" £—
    Mr. Speaker: Order. Is this a question?
    Mr. Walden: Yes, Mr. Speaker. Has the Treasury done any calculations about when the "ten bob" £ will become a reality?
    Mr. Higgins: The important point which needs to be emphasised is that we should take measures which will prevent the decline in the value of the £. We are determined to do that.

    Property Tax
    Mr. Meacherasked the Chancellor of the Exchequer if he will propose the reintroduction of Schedule A tax.
    Mr. Patrick Jenkin: No, Sir.
    Mr. Meacher: Is the hon. Gentleman aware that because there is no Schedule A tax and no capital gains tax on excessive rises in house prices, the average executive earning over £5,000 a year has gained about £14,000 in untaxed housing capital gains under the present Government while during exactly the same period the average tenant has been forced to pay an average of 30p a week more in rents? Is this not a grotesque inequality, as offensive to the Chancellor as the land speculation of which he purports to disapprove? When will he stop this and land speculation?
    Mr. Jenkin: I cannot see how it would conceivably help the tenant to hit at the position of the owner-occupier. To re-impose the old Schedule A—there is a new Schedule A on rents—would hit at the expansion of owner-occupation, something which has been supported on both sides of the House, would impose new burdens on existing owner-occupiers, would impose a much greater burden on those who have paid off their mortgages, many of whom will be elderly retired people, and would require a large number of extra Revenue officials. It would be interesting to know whether that is the policy of the Labour Party.
    Mr. Jay: If the hon. Gentleman will not do as my hon. Friend asks, will he at least set a ceiling for tax relief on mortgage interest since this is becoming a scandal and is one of the main causes of the present high price of houses?
    Mr. Jenkin: The position of tax relief on mortgage interest is exactly as it was left by our predecessors in June 1960.
    Mr. David Stoddart: If the Minister will not agree to either of these proposals will he try to bring some fairness into the system as between owner-occupiers and rent-payers, who do not draw a subsidy from any source, by allowing rent-payers to set a proportion of their rent against tax?
    Mr. Jenkin: That is a wholly different question.

    Value Added Tax
    Mr. Dalyellasked the Chancellor of the Exchequer if he will make a statement on his discussions with the retailing organisations on the value added tax.
    Mr. Barber: We have had a number of discussions with retailers about the abolition of purchase tax and SET and the introduction of VAT. The retailing organisations have been most co-operative and helpful, and I am grateful to them. I look forward to these discussions continuing.
    Mr. Dalyell: As it is now seven months since a row on both sides of the House led the Government to set up the Munro Committee to deal with the tax on children's shoes, why has no decision yet been arrived at? Surely this is not the most complicated subject in the world.
    Mr. Barber: It may not be a complicated subject but I can assure the hon. Gentleman that Mrs. Munro's excellent report is a full and comprehensive one. In these circumstances it is necessary that it should be most carefully considered by my right hon. Friends and myself. We are doing that.
    Mr. Joel Barnett: Will the right hon. Gentleman reverse his outrageous decision to penalise in particular small retailers who have not registered for VAT by 31st March, through no fault of their own but because of the extreme complications of the tax, and thus allow them credit for purchase tax on stocks?
    Mr. Barber: I am surprised that the hon. Gentleman, in view of his professional qualifications, should say that mere registration is a difficult or complex matter. This is not so. The fact is, and it is as well that those concerned appreciate this, that it is in the interests of people to register as soon as possible because of this rebate of purchase tax.
    Mrs. Kellett-Bowman: Will my rigor hon. Friend accept that what the public want is the right answer on VAT and children's shoes, and not necessarily a speedy one as the Opposition seem to want?
    Mr. Barber: It was as a result of the responsible attitude adopted by some of my hon. Friends who felt strongly about this matter that the Munro Committee was set up.
    Mr. Duffyasked the Chancellor of the Exchequer what progress he has made with explanations to, and registrations of, retailing organisations for value added tax.
    Mr. Higgins: Retailers registered for VAT are being visited and advised by Customs and Excise officers, who have already addressed over 7,200 meetings representing all sectors of trade, including retailers. Explanatory notices have been issued. A special leaflet for small retailers has been issued and another will be issued this month.
    More than one-third of the estimated number of retailers required to register had been registered by 15th January.
    Mr. Duffy: Is the Minister aware that everything points to the vital registration process falling seriously behind schedule because, as he has just reminded the House, only half a million businesses have so far registered whereas it was intended to register 1½ million by the end of next month? How, therefore, will he avoid serious administrative problems?
    Mr. Higgins: I do not accept what the hon. Gentleman says. At the same time I would not wish to be complacent. It is important to remember that there are not only the number which have actually been registered—the figure I quoted a moment ago—but also those applications which are now being processed at the VAT headquarters in Southend and a substantial number of applications in local VAT offices. None the less I emphasise, as my right hon. Friend said a moment ago, that unregistered traders will still be liable for the output tax when it comes into operation and will not be able to claim back input tax or the purchase tax rebate. Therefore, it is in the traders' own interest to register as rapidly as possible.
    Dr. Stuttaford: Does my hon. Friend agree that shoe retailers will not know how they are placed until they know about the application of VAT to children's shoes? Will he confirm or deny that the Munro Report has now been with the Treasury for many weeks?
    Mr. Higgins: My right hon. Friend has dealt with that and, as he has said, he will deal with the question in his I3udget Statement.
    Mr. R. C. Mitchellasked the Chancellor of the Exchequer whether the payment of fees by retailers to organisations advising them on the complexities of value added tax are allowed as a tax deductible expense.
    Mr. Higgins: Expenditure on advice on the operation of VAT would normally be allowed as a deduction in computing profits for income tax or corporation tax purposes.
    Mr. Mitchell: Is the Minister aware that, since it has become known how complex VAT is, large numbers of individuals and organisations have set themselves up as VAT consultants? Does he agree that this is probably the only growth industry we have seen under the present Government?
    Mr. Higgins: No, I would not agree with that for one moment. I suggest that individual retailers or others with particular problems should consult their local VAT office, which will be pleased to help them.
    Mr. Walter Johnsonasked the Chancellor of the Exchequer if he will now say that he will zero-rate value added tax on children's clothes and footwear.
    Mr. Higgins: I cannot anticipate my right hon. Friend's Budget Statement.
    Mr. Johnson: Does not the Minister realise that the imposition of VAT on essentials such as children's clothing and footwear will bear most heavily on poorer families? How does this line up with the Prime Minister's recent statement on the pay and prices legislation that he wants to protect the lower paid? Come off it! Let us have zero-rating on children's footwear and clothing.
    Mr. Higgins: This matter was debated at considerable length in the Finance Bill debates last year. Again, as I am sure the hon. Gentleman will appreciate, I cannot anticipate my right hon. Friend's Budget Statement.
    Mrs. Kellett-Bowman: Since the exemption of child-size clothes as opposed to children's clothes would give an unfair bonus to small-size adults whereas it would in no way help the parents of large-size children, will my hon. Friend consider instead assisting parents by means of tax or other allowances?
    Mr. Higgins: I have taken note of what my hon. Friend says, as no doubt has my right hon. Friend.
    Mr. Dalyell: For how many weeks has the Munro Report been with the Treasury?
    Mr. Higgins: I am afraid I do not have that information.
    Mr. Costainasked the Chancellor of the Exchequer what would be the estimated value added tax loss to the Treasury in a full year on the basis that the items listed in the Finance Act 1972, Schedule 5, Group 1 (Exemption from VAT for certain interests in land) were zero-rated instead of exempted.
    Mr. Higgins: Probably over £50 million.
    Mr. Costain: Will my hon. Friend consider how much easier administration would be if the items on this list were zero-rated?
    Mr. Higgins: Be that as it may, the figure I have just quoted is one which we need to consider very carefully.
    Mr. Joel Barnettasked the Chancellor of the Exchequer if he will reconsider his decision not to postpone the introduction of value added tax, in view of the number of traders who have failed to register.
    Mr. Higgins: No, Sir.
    Mr. Barnett: Will the hon. Gentleman reconsider that answer in view of the fact that so far, only 336,000 traders have registered out of a total of 1,500,000, and bearing in mind the points which have been made about the state of the Civil Service, particularly the Customs and Excise officials, and the certainty—which must flow from those figures and other information available to the Treasury—that traders are not ready to cope with this enormously complicated task? Does not the hon. Gentleman appreciate that many people believe that the Chancellor of the Exchequer has taken leave of his senses in introducing a tax of this kind at a time when he is putting forward totalitarian measures of a kind which have never before been used in this country? Does he not agree that it is outrageous to introduce such a tax at the same time as he seeks to introduce wage controls?
    Mr. Higgins: I do not for a moment accept the hon. Gentleman's remarks. As for the conjuncture of the introduction of
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    value added tax and the Government's prices and incomes policy, he will be aware that in the Government's White Paper we propose specific measures for the introduction of VAT. I am a little surprised that the hon. Gentleman has again raised the general question. When we debated the subject very fully before Christmas on a Supply Day, the Opposition had so little enthusiasm for their own motion that they could not muster enough Members to keep the debate going.
    Mr. Ridley: Does my hon. Friend agree that to postpone the introduction of VAT for the simple reason that traders have not bothered to register would give traders a weapon for all time in that they could put off a tax by the simple process of refusing to register? If the rule of law means anything, will my hon. Friend firmly tell the House that he has no intention of postponing the introduction of VAT?
    Mr. Higgins: I have made absolutely clear, as has my right hon. Friend the Chancellor of the Exchequer, that we have no intention of delaying the introduction of VAT or of delaying the abolition of SET and purchase tax. I do not accept the remarks of the hon. Member for Heywood and Royton (Mr. Joel Barnett) about registration, but at the same time we are not complacent about the situation. We believe that it is in everybody's interest that traders should register as soon as possible, given the fact that unregistered traders cannot deduct input tax. They will still be liable for output tax and they will not be able to take advantage of the purchase tax scheme if entitled to it.
    Mr. Gorstasked the Chancellor of the Exchequer whether, in every instance in which value added tax is levied, it will be possible for the person providing a product or service to pass on the tax to the consumer; if not, what estimate his Department has made of the proportion of the tax that will be levied in this way; which industries are likely to be so affected; and if he will make a statement.
    Mr. Higgins: Such information is not available.
    Mr. Gorst: Will my hon. Friend undertake to reconsider the position of traders and those who supply a coin-operated service who are unable to pass on the tax to the consumer? Since this tax is expected to be paid by the consumer, will my hon. Friend give an undertaking that this matter will be reconsidered?
    Mr. Higgins: I am afraid I cannot give an undertaking of that kind. I fully appreciate my hon. Friend's concern on this topic which he has raised on a number of occasions. The difficulty in regard to coin-operated machines arises on the question of discontinuity in terms of the large size of coin unit in which the amount is paid. None the less the introduction of VAT and the abolition of SET and purchase tax is a change in costs, and the industry has coped with similar changes in costs where precisely the same problems have arisen. I believe that it will succeed in coping in this instance.
    Mr. Brian Walden: Has the Treasury now provided an answer to the coin slot problem better than the one we had in Committee concerning launderettes—namely, that people should buy a season ticket?
    Mr. Higgins: That was one of the points raised in Committee and I am well aware of the hon. Gentleman's continuing interest in this subject. Whenever there are changes in costs, there are always problems for the operators of coin-operated vending machines and other coin-operated machines. I do not regard this as a unique problem connected with the introduction of VAT and the abolition of SET and purchase tax, and I do not believe that this will necessarily create any more problems than any other changes in costs, which have been experienced by the industry.
    Mr. Gorst: In view of the unsatisfactory nature of the reply, I give notice that I shall seek to raise the matter on the Adjournment at the earliest possible moment.

    External Debt
    Mr. Geoffrey Finsbergasked the Chancellor of the Exchequer what is the present total of medium and short-term official overseas debt; and how this compares with October 1964 and June 1970.
    Mr. Barber: The total of short- and medium-term official external debt, converted at parity rates, was as follows: at end-September 1964, £71 million; end-June 1970, £1,461 million; and at the present time, nil.
    Mr. Finsberg: Does my right hon. Friend agree that those are extremely interesting figures? Will he arrange to let the House have similar figures a little more frequently as they show exactly what inimical results the trade union movement is achieving when it tries to sabotage national industry?
    Mr. Barber: One thing which we determined to do when we took office in June 1970 was to rid ourselves of this debt which had been contracted by the previous Government.
    Dr. Gilbert: In view of the galloping deterioration in the balance of payments position over the last few months and the predictions of the London and Cambridge model, which is very close to the model used by the Treasury, will the Chancellor say whether he intends during the next few months to deal with the situation by imposing more exchange control, by borrowing abroad or by facing a haemorrhage of reserves and letting the rate sink even further, with serious results to the cost of living and the payments to be made to the European Community?
    Mr. Barber: In the Budget Statement on 6th March I shall be dealing with the balance of payments. Not only have we repaid all the official debt but, in addition, our reserves are now twice as large as they were when the hon. Gentleman's party left office.
    Mr. Jay: Will the Chancellor of the Exchequer, who no doubt carries all these figures in his head, tell us what was the balance of payments deficit in October 1964, June 1970 and January 1973?
    Mr. Barber: I have a faint suspicion that the right hon. Gentleman knows the answer to that question.

    War Widows' Pensions
    Mr. Goodhartasked the Chancellor of the Exchequer what estimate he has made of the cost of removing the tax on the pensions of war widows.
    Mr. Patrick Jenkin: The information on which to base an estimate is not available.
    Mr. Goodhart: Will my hon. Friend remember that Germany and Italy—and this will apply eventually to all our partners in the European Community—do not impose any tax on the pensions of war widows? Will he also remember that in the forthcoming Budget he has the opportunity not only to help these widows but also to strike a blow for European tax harmonisation?
    Mr. Jenkin: It is with great hesitation that I correct my hon. Friend, but Denmark is among several countries, which include the Netherlands and Italy, which impose tax on war widows' pensions. We have always taken the view—because it would give nothing to those below the tax threshold and be of maximum benefit to those with substantial other income—that to exempt these pensions from tax is not the right way to help war widows. Instead we aim to increase the level of war widows' pensions whenever that is possible.
    Mr. Ashley: Is the Minister aware that, while it is difficult to disentangle the problems of war widows from those of widows generally and the problems of widows generally from those of other single-parent families, the Government appear to be incredibly indifferent to the plight of these disadvantaged families? When will some initiative be taken on behalf of these people on the same lines as that which has been taken for surtax payers?
    Mr. Jenkin: I must contradict the hon. Gentleman. I just do not believe that his accusation bears any relation to reality. On the contrary the Government have done more to give specific help to those families which face specific problems than did their predecessors. We can stand proudly on our record on this.

    Car Tax
    Mr. Madelasked the Chancellor of the Exchequer what plans he has for the special 10 per cent. car tax announced in his last Budget; and if he will make a statement.
    Mr. Higgins: A general guide to car tax procedure was issued in September by the Customs and Excise to car manufacturers and commercial importers and arrangements for the introduction of the tax on 1st April are going steadily ahead.
    Mr. Madel: When the announcement of this tax was made last April the Chancellor of the Exchequer promised chat he would keep it under constant review. As the costs of materials for the motor industry have risen since April, and as the highest level of demand for cars is essential to full employment in the motor industry, does my hon. Friend feel that 10 per cent. is too high?
    Mr. Higgins: I have noted my hon. Friend's suggestion.
    Mr. Lipton: Why not abolish altogether the car tax and simplify the procedure by increasing the price of petrol?
    Mr. Higgins: I have noted the hon. Gentleman's suggestion with some interest, but the car tax was debated at considerable length in the Finance Bill debates and is now incorporated in the Finance Act.

    Nationalised Industries
    Mr. Ridleyasked the Chancellor of the Exchequer if he will co-ordinate the activities of Ministers responsible for nationalised industries with a view to bringing the industries back to profitability.
    Mr. Patrick Jenkin: I would refer my hon. Friend to Paragraphs 17 and 18 of the White Paper on Controlling Inflation (Cmnd. 5205). Existing arrangements for co-ordination between Ministers are satisfactory and are working well.
    Mr. Ridley: Does not my hon. Friend agree that spending over £500 million a year on subsidising the nationalised industries and those industries not having to pay interest on their capital contributes to the increased money supply which is causing inflation? To curb inflation, would it not therefore be right to begin to get back to the level of profitable charges in this sector of the economy?
    Mr. Jenkin: My right hon. Friend and, indeed, the Government have never concealed from the House or the country

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    that there are significant disadvantages in pursuing a policy of price restraint in the nationalised industries. But in our view these are outweighed by the advantage of achieving greater price stability at a time when we are trying to bring the general level of price increases more under control. My hon. Friend will have taken note of the provisions in the White Paper that in stage 2 the nationalised industries will be subject to the same criteria for increasing prices as is private industry.
    Mr. Sheldon: Will the Chief Secretary tell the House what will be the criteria for profitability for the nationalised industries? At present it looks as though they will receive an open-ended subsidy. If so, there will he no criteria of profitability to replace those which we have known for some years.
    Mr. Jenkin: There is no question of an open-ended subsidy for the nationalised industries. The extent to which they will be allowed to increase their prices and charges will be rigorously controlled and, apart from profitability, is on the same basis as that which applies to private industry.

    Customs and Excise Staff
    Mr. John Grantasked the Chancellor of the Exchequer if he will make a statement about his meeting during the recess with the Customs and Excise Departmental Whitley Council to discuss departmental morale, problems arising from the introduction of value added tax, the effect of the pay freeze and other matters.
    Mr. Barber: I saw representatives of the Staff Side of Customs and Excise Departmental Whitley Council on 10th January and I took note of their views.
    Mr. Grant: Will the Chancellor acknowledge that, contrary to the impression he gave not long ago, morale in the Department of Customs and Excise is very unsatisfactory and that there is gross overworking, mainly because of EEC entry, the implications of VAT and the grossly unfair treatment of the Civil Service in the current freeze? Is he not setting the worst possible example as an employer?
    Mr. Barber: I do not think so. I appreciate the concern of those who came
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    to see me about the pay standstill but I hope that they, like the public at large, will recognise the justification for what the Government are doing. We had a very useful discussion covering a variety of matters.
    Mr. Eadie: Does the right hon. Gentleman realise that the House is not impressed with the so-called fairness with which he claims to have treated the Civil Service? Is he aware that the pensions of civil servants on the eve of retirement will suffer as a consequence of the freeze? Does he think that that is fair?
    Mr. Barber: The problem is an obvious one. When one imposes a standstill one does one's best to make it as fair as possible between one group of employees and another, and this we have done.
    Mr. Ridsdale: I support my right hon. Friend's policy, but I ask him to look closely into this matter because some of the lower-paid civil servants who work alongside people who are making much more money are having to work overtime, and there is justification for the hard feelings that some of them have.
    Mr. Barber: I note what my hon. Friend says, but I cannot support any proposal which would result in different treatment—other than what we have laid down—for those individuals about whom he is speaking during the standstill.

    Exchange Rate
    Mr. Jayasked the Chancellor of the Exchequer whether his proposed policy for £ sterling is a fixed exchange rate or a fixed but adjustable rate; and when this will be put into force.
    Mr. Patrick Jenkin: We intend to return as soon as conditions permit to the maintenance of a fixed parity within agreed margins, against the background of an international monetary system based on a regime of fixed but adjustable parities.
    Mr. Jay: Will the hon. Gentleman make rather clearer than he has done in his answer whether what the Government propose to adopt is a regime of fixed parities or of fixed but adjustable parities?
    Mr. Jenkin: I am well aware that the right hon. Gentleman seeks to find some inconsistency between the use of the phrases "fixed rate" and "fixed but adjustable rate". There is none. What we shall return to is a fixed rate. If the right hon. Gentleman wants to find an implication that membership of the Communities means that parities must be immutably fixed now, he will not be able to do so. In the first stage, and probably in the second stage, of the move to European economic and monetary union—although that is still a good way ahead—changes of parity during those phases will be possible.

    NORTH SEA OIL AND GAS
    Mr. Douglasasked the Prime Minister if he remains satisfied with the co-ordination between the Scottish Office and the Department of Trade and Industry and the Department of the Environment with regard to the formulation of policy for the development of North Sea oil and gas pending the publication of a White Paper; and if he will make a statement.
    The Prime Minister (Mr. Edward Heath): Yes, Sir. I am satisfied that there is close co-ordination between Departments on this matter. I do not think a White Paper would be appropriate: a report to Parliament was presented on 16th January and Government measures are announced as the opportunities develop.
    Mr. Douglas: Does not the Prime Minister accept that the response to the IMEG report by the Government has been puerile and timorous in setting up a branch office of the Petroleum Industry Supply Board in Glasgow? How many civil servants or others will that branch office employ? Will not the Prime Minister update the figures of reserves in the North Sea so that we can see the full potential of the finds there?
    The Prime Minister: No, Sir. The Government's response to the report has been to put in Scotland as large a share as possible of the organisations concerned in this important development. It is right that it should be allied to the organisation which exists here in White-
    214
    hall; I am sure that is the best way to produce results. Any estimate of reserves must depend on progress made in drilling in the North Sea. From time to time we give estimates and try to keep them up to date as far as possible.
    Mr. Wolrige-Gordon: Will my right lion. Friend say whether the new development committee, which incorporates civil servants from both Departments mentioned in the Question, has any locus in planning matters as well as in development questions?
    The Prime Minister: I think that the planning questions will remain with the normal authorities, but the Scottish Petroleum Office will be part of the Scottish Industrial Development Office in Glasgow. There will also be a branch of the DTI Petroleum Division in Glasgow. This, combined with the North Sea Oil Development Committee as part of the Scottish Economic Planning Board, should cover the ground.
    Mr. Russell Johnston: The Prime Minister should be aware of the fact that there is a good deal of dissatisfaction in Scotland at the lack of power in the Scottish Office to take any initiative on likely oil revenues and environmental control of associated developments. Will he reconsider the establishment of some sort of development corporation, as has been suggested by the Scottish TUC and the Scottish Council, which could have a much more direct control over oil policy in Scotland?
    The Prime Minister: I am fully prepared to consider proposals of this kind but I emphasise that we gave much consideration to this organisation as a result of the report we received. I do not agree that the Scottish Office is inhibited in taking the initiative. Indeed, many people have paid tribute to the speed with which matters have advanced in Scotland. The Scottish Office has stepped in to prevent any undesirable environmental effects.

    TAXATION (PRIME MINISTER'S SPEECH)
    Mr. Ashtonasked the Prime Minister whether he will place in the Library a copy of his public speech to

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    the Gimcrack Club on 8th December on taxation matters.
    Mr. Meacherasked the Prime Minister if he will place in the Library a copy of his public speech at York on 8th December concerning taxation.
    The Prime Minister: I did so on 11th December, Sir.
    Mr. Ashton: Is the Prime Minister aware that in that speech he said that he may have been a source of gain to the people who backed him at the last election? Was he talking about people on the same salary as himself who are £6·16 a week better off because of the income tax cuts, or was he referring to the price of horse meat which has risen as high as the price of beef?
    The Prime Minister: In that speech I was talking about those who backed me against the public opinion polls. They did rather better at the last election than those who backed the Leader of the Opposition.
    Mr. Meacher: Since the Prime Minister referred in that speech to the fairness of his Government's taxation reforms, especially VAT, why is VAT being introduced to push up prices during a prices freeze at exactly the same time as the abolition of the surcharge on unearned income will give the lion's share of £300 million a year almost wholly to the rich?
    The Prime Minister: The hon. Gentleman has no justification for the first part of his remarks about the impact of VAT. As we explained in the White Paper action is being taken to ensure that in terms of the reflection in prices this is carried out. In any event, we shall be debating this tomorrow.
    As for the second part of the hon. Gentleman's supplementary question, two-thirds of the benefits which will follow from unification go to those with incomes below £5,000 a year, and 30 per cent. will go to the 11 per cent. of taxpayers who have retired.
    Mr. Kenneth Lewis: While my right hon. Friend is considering putting copies of various speeches in the Library, will he also consider placing there a copy of the full text of his recent presidential—
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    I mean Prime Ministerial—Press conference so that we can examine it and discover whether representatives of the Press are as good at putting questions to him as we are?
    The Prime Minister: If it is not already in the Library, it can be easily put there.

  OFFICIAL SECRETS ACT
  Mr. William Hamiltonasked the Prime Minister what progress has been made in consultations on the recommendations of the Franks Report on Section 2 of the Official Secrets Act.
  The Prime Minister: The Government have not yet completed their examination of these important recommendations: we are considering their implications for the whole range of Government business and we will announce our conclusions on them as soon as possible.
  Mr. Hamilton: In view of recent evidence of the Government and the police together trying to muzzle the Press, does not the Prime Minister recognise that it is very important that this House should have the chance to debate the Franks Report before the Government take their decisions? Is the Prime Minister aware that there is a lot of opinion in the country and among members of the Press that the implementation of the Franks recommendations, far from reducing secrecy in government, will tend to increase it?
  The Prime Minister: I am prepared to consider the last part of the hon. Gentleman's observations. This is a very important report and they are complex matters. That is why it is taking time to consider them. The Government said at the beginning that they would wish to have an expression of public opinion on it before making up their minds on the recommendations about whether legislation should be introduced. I cannot accept what the hon. Gentleman said in the first part of his supplementary question. There was no attempt to muzzle the Press. The action was taken by the Director of Public Prosecutions on evidence made available to him. The hon. Gentleman must face the fact that I am constantly pressed to safeguard all information in Government Departments.

  217
  If he believes that it is right and justifiable for documents to be stolen from Government Departments, he must say so.
  Mr. English: Rather than use the vague phrase "as soon as possible", does the Prime Minister ever fix targets within which relatively simple decisions should be made? Is "as soon as possible" two weeks, months, years or what? People are beginning to want to know when this decision will be made. I do not necessarily mean today, but we should like some indication of when it will be made.
  The Prime Minister: Yes. The target is "as soon as possible".

  COUNTER-INFLATION PROPOSALS
  Mr. Skinnerasked the Prime Minister what plans he has for further meetings with the Confederation of British Industry and the Trades Union Congress on the question of the economy.
  Mr. Redmondasked the Prime Minister what plans he has for further consultations with the Confederation of British Industry and Trades Union Congress on economic policies.
  Mr. Strangasked the Prime Minister what plans he now has to have further discussions with both sides of industry about the second phase of the Government's policy on inflation.
  The Prime Minister: Before announcing the second stage of the Government's policies to control inflation, I had a series of meetings with representatives of the Confederation of British Industry, the Trades Union Congress and the retail trade. We intend to continue these discussions or to exchange views on particular points with any of the parties in the light of the proposals contained in the White Paper (Cmnd. 5205), and of course we will be consulting them on the Price and Pay Code.
  Mr. Skinner: It looks as if the TUC has given the right hon. Gentleman the slip. Is he aware that in the absence of the TUC, which has at last learned some sense about this matter, he ought to invite some of his real friends next time?
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  I mean people like Lord Watkinson and Henry Plumb who speak with the real voice of the Prime Minister when they say that cheap food has gone for ever. The right hon. Gentleman might invite the Director-General of the Food Manufacturers' Federation—[An HON. MEMBER: "Ask a question."] This is not a question—
  Mr. Speaker: Did I hear the hon. Member say that this was not a question? If it is not a question it is completely out of order.
  Mr. Skinner: I withdraw that last remark, Mr. Speaker. It is a question. Will the Prime Minister invite the Director-General of the Food Manufacturers' Federation, who said last week that if the sugar grant is abolished, by the end of this month all manufactured foods containing sugar will be subject to increases in price of up to 15 per cent.?
  The Prime Minister: The hon. Gentleman refers to discussions with representatives. We had discussions with the whole retail trade and obviously that included the food manufacturers. Food manufacturers are subject to the controls. To deal with the hon. Gentleman's general point, he had better await the results of the discussions in Brussels.
  Mr. Redmond: Is my right hon. Friend aware that at least in Bolton there is a large body of trade union opinion solidly behind Tom Jackson in what he says about the TUC attitude? Is it not time that this moderate voice of the silent majority was widely heard in the country?
  The Prime Minister: We have had discussions with the TUC's representatives. There were the tripartite talks in Chequers and there have been the bilateral talks since. I believe that it is right for these talks to continue.
  Mr. Strang: Is the Prime Minister aware that people are not impressed by gimmicks such as the elaborate price monitoring mechanism in the DTI or the Ministry of Agriculture and the recent inquiry into beef prices? Does he not realise that his policy on wages will never be successful as long as food prices continue to escalate? Is it not intolerable that at a time when farmers are making sharply increased profits from

  219
  beef prices the Government take millions of £s out of the pockets of farm workers by freezing a wage increase which ought to have come into operation yesterday?
  The Prime Minister: The first part of the hon. Gentleman's supplementary question is incorrect. We have explained that phase 2 is not a standstill but a wage arrangement which we believe is what the economy can stand. We should have liked a voluntary agreement, but we believe that it is right to ask Parliament to approve it.
  In reply to the last part of the hon. Gentleman's supplementary question, the farmers' position will be taken into account in the Price Review which begins next month.
  Sir Gilbert Longden: Has my right hon. Friend any reason to think that the Sunday Press, apart from its natural desire to spread alarm and despondency, had any good evidence for prophesying that phase 3 would be tougher than phase 2?
  The Prime Minister: No, Sir. There was no reason whatever for prophesying that and there is no point in the Leader of the Opposition trying to shut his eyes to it. The details of phase 3 will be discussed in the usual way with the CBI and the TUC. The purpose is to achieve an improvement in people's real standard of living without having excessive wage increases which push up prices and make us uncompetitive overseas. That is not a tougher policy. It is a policy to improve the real standards of living of the people.
  Mr. Harold Wilson: Does the Prime Minster accept full responsibility for the ministerial action last Saturday in putting out stories about the likely tightening up under phase 3? Does he accept responsibility for it? Does he even know that it happened?
  The Prime Minister: There was no such ministerial action. [HON. MEMBERS: "Oh."] If the right hon. Gentleman will consult paragraph 32 of the White Paper he will find the position set out clearly.
  Mr. Wilson: Since paragraph 32 of the White Paper was available at one o'clock last Wednesday, will the Prime Minister explain why it was not interpreted in this way by a single news-
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  paper? Nearly every Sunday newspaper so interpreted it and next day the Daily Telegraph referred to "ministerial briefings" and "devious means" of putting out that story.
  The Prime Minister: I repeat that there was no ministerial briefing that phase 3 was to be a tougher policy. The paragraph in the White Paper sets out clearly the purpose of improving the real incomes of the people. If the right hon. Gentleman still wishes to be reassured about an improvement in real incomes he should look at that paragraph and accept it, as people did at the Press conference at Lancaster House.
  Mr. Wilson: I have read paragraph 32. No one on Thursday, Friday or Saturday so interpreted it until the ministerial conference on Saturday morning.
  The Prime Minister: It was there for everybody to see. It was accepted as such until certain industrial correspondents interpreted it the way the right hon. Gentleman did. [Interruption.] I repeat, there is no justification for what the right hon. Gentleman said.
  Several Hon. Members——
  Mr. Speaker: Order. I understand that there is to be a debate on these matters tomorrow.

LIFE SENTENCES
Mr. Edward Taylor: On a point of order, Mr. Speaker. I seek your guidance on an answer which I received from the Home Office yesterday, which is reported in col. 24 of the Official Report. The Minister of State, Home Office, declined to give the average number of years served by persons released from prison after serving life sentences on the ground that such information was unrealistic and could be misleading.
On 11th February last year I asked the Home Secretary for the same information, the average figures for each of the years 1961–1971, and was provided with that information in great detail. This astonishing change of attitude will be difficult to explain at any time; but I should point out that, as this figure is one of the key statistics relevant to my Private Member's Bill on Friday, I should

221
like to ask whether you, Mr. Speaker, can protect me and the House against the withholding of information which was supplied last year and could, if disclosed, greatly influence any decision which may be made by the House on Friday.
Mr. Speaker: I am grateful to the hon. Member for indicating to me beforehand that he proposed to raise this point of order and the nature of it. This is not a matter for me. I have consulted Erskine May, and the answer there is that an answer to a Question cannot be insisted upon if the answer be refused by a Minister. However, I have no doubt that the hon. Member's point has been noted.
The Minister of State, Home Office (Mr. Mark Carlisle): Further to that point of order, Mr. Speaker. I apologise to my hon. Friend if the information which we gave in reply to his Question did not wholly answer it. I understand that the arithmetic to divide the figure into an average is not done, but I will make sure that my hon. Friend gets the information today.

BILLS PRESENTED

  COUNTER-INFLATION
  The Prime Minister, supported by Mr. Chancellor of the Exchequer, Mr. Secretary Whitelaw, Mr. James Prior, Mr.
  222
  Secretary Rippon, Mr. Secretary Campbell, Mr. Secretary Walker, Mr. Secretary Peter Thomas, Mr. Secretary Macmillan, Mr. Joseph Godber, Sir Geoffrey Howe, and Mr. Attorney General presented a Bill to establish a Price Commission and a Pay Board; to authorise the formulation of the principles to be applied by those bodies; to afford powers of control over prices, pay, dividends and rents; to provide for the furnishing of information about rates; and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 51.]

  WATER
  Mr. Secretary Rippon, supported by Mr. Secretary Peter Thomas, Mr. Joseph Godber, Mr. R. Graham Page, Mr. Patrick Jenkin, and Mr. Eldon Griffiths presented a Bill to make provision for a national policy for water, for the conferring and discharge of functions as to water (including sewerage and sewage disposal, fisheries and land drainage) and as to recreation and amenity in connection with water, for the making of charges by water authorities and other statutory water undertakers, and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 52.]

DIVORCE LAW REFORM (SCOTLAND) BILL
3.34 p.m.
Mr. William Hamilton: I beg to move,
That leave be given to bring in a Bill to amend the law of Scotland relating to divorce, dissolution of marriage and judicial separation, and to the power of the court to award interim aliment; and for purposes connected with the matters aforesaid.
The need for such reform is recognised as necessary by the Scottish Law Commission, the Scottish Law Society, the Church of Scotland and the Scottish Office as well as a large body of enlightened opinion. Indeed, the Scottish Office has kindly agreed to help me in the drafting of such a Bill.
The names of the sponsors indicate all-party support, so in that sense it is a non-party, non-controversial measure. It will be generally similar to the contents of a Bill introduced last year by my hon. Friend the Member for Aberdeen, North (Mr. Robert Hughes), which received an unopposed Second Reading but got into Committee too late to ensure its enactment.
It is now just over two years since the new English law came into operation. That Act recognised that a marriage could break down irretrievably without any matrimonial offence having been committed. Therefore, it provided for divorce after two years' separation if both parties agreed, and after five years' separation if the petition were contested.
The Scottish law is still based on the principle that there can be no divorce unless a matrimonial offence has been proven. I believe it is the general wish that the law on this matter as between Scotland and England should now be harmonised.
The proposed Bill would seek to meet the criticisms made of my hon. Friend's Bill by the Law Society and others. They were criticisms of detail and wording rather than of any fundamental principle: for example, on the question whether a marriage had irretrievably broken down because one of the parties had
"at any time behaved, whether as a result of mental abnormality or not, in such a way that the aggrieved party, that is, the pursuer, cannot reasonably be expected to cohabit with the defender."
224
The Scottish Law Commission has felt, for reasons which I need not expound, that it would be better to retain incurable mental illness as a separate situation evidencing irretrievable breakdown. The commission also proposes to retain the power in the court to refuse a decree where the pursuer has been guilty of such wilful neglect or misconduct as has conduced to the defender's mental illness.
My hon. Friend's Bill also abolished, in effect, the defence of connivance where the situation evidencing breakdown was the defender's adultery. The Scottish Law Commission does not think this is acceptable, and proposes that that defence, which in any case operates only rarely, should be retained.
One further point of difference from my hon. Friend's Bill concerns proof of actual physical separation of the partners over the requisite period. A judgment in the English Court of Appeal, Santos v. Santos-1972 2 Weekly Law Reports, page 889—held that:
"mere physical separation for two years was not sufficient to constitute living apart ', and that a petitioner had to prove not only the factum of separation for two years but that he or she had ceased to recognise the marriage as subsisting and intended never to return to the other spouse, albeit that the petitioner's state of mind need not be communicated to the other spouse."
It is proposed in the Scottish Bill to make it clear that physical separation of the spouses is sufficient to evidence breakdown of the marriage in so far as it is possible to obtain a suitable form of words to deny the construction put upon the wording of the English Act of 1969 by the Court of Appeal, to which I have referred. This is a Committee point of some substance which could, no doubt, be debated if I am given permission to bring in the Bill.
Last year's Bill made no provision for any judicial discretion to refuse a divorce if the five years' separation situation were established. This contrasted with Section 4 of the English Act, which put a duty on the court where the defender opposed on the grounds of grave financial or other hardship in the event of the dissolution of the marriage. The Scottish Law Commission is now of the opinion that there is some need for an overriding discretion to be vested in the court to refuse a decree in a situation where grave financial hardship would be

225
inflicted upon a defender. Certain English reported cases suggest that this power is not likely to be lightly used, and the proposed Bill would in any event be more tightly drawn in this respect than its English counterpart.
The financial provisions are, of course, crucial. They will be similar to those contained in the 1972 Bill. It is thought desirable to add a provision empowering the court to award a capital sum for the children of the marriage. There are various other provisions designed to improve the composition of the Bill introduced by my hon. Friend last year.
The Labour Government, as a matter of deliberate policy, provided time for the House to decide matters of social consequence and controversy which cut across party lines. Few will doubt that the legislation so passed has been of immeasurable benefit. The present Government, for good or ill, have adopted another policy and indicated that every Bill of this nature must take its chance. Flow, ever, this Bill could well be made an exception to that general rule on the ground that it is supported by the Government Department most immediately concerned, the Scottish Office; by the Church of Scotland; by the Scottish Law Commission; and by the Scottish Law Society. In that spirit, I beg leave to introduce the Bill.
Question put and agreed to.
Bill ordered to be brought in by Mr. William Hamilton, Mr. Ronald King Murray, Mr. Bruce Millan, Mr. J. Grimond, Mr. Hugh D. Brown, Mr. Robert Hughes, Mr. Ian MacArthur, Mr. John Smith, Mr. Dick Douglas, Dr. Gavin Strang and Mr. Tam Dalyell.

DIVORCE LAW REFORM (SCOTLAND)
Bill to amend the law of Scotland relating to divorce, dissolution of marriage and judicial separation, and to the power of the court to award interim aliment; and for purposes connected with the matters aforesaid, presented accordingly, and read the First time; to be read a Second time upon Friday 9th March and to be printed. [Bill 53.]
ORDERS OF THE DAY

  FURNISHED LETTINGS (RENT ALLOWANCES) BILL
  Order for Second Reading read.
  3.41 p.m.
  The Minister for Housing and Construction (Mr. Paul Channon): I beg to move, That the Bill be now read a Second time.
  Mr. Speaker: I have selected the amendment in the name of the right hon. Member for Grimsby (Mr. Crosland).
  Mr. Channon: As the House will know, the Bill provides for rent allowances to be granted to tenants of furnished accommodation. It fulfils an undertaking given by my right hon. Friend the former Minister for Housing and Construction during the Report stage of the Housing Finance Bill in April last year. My right hon. Friend then said that we had reached a position where we could embark on formal consultations with the local authority associations with a view to working out a practical and effective scheme for providing rent allowances for tenants of furnished accommodation. Subsequently, in August, my right hon. Friend announced that with the help of the local authority associations a practical scheme had been devised and the Government would bring forward legislation as soon as possible.
  I believe—I know that there are other views in the House—that we have found a fair and workable way of overcoming the difficulties, which I admit to the House are considerable. Now for the first time, if the House agrees to pass this legislation, tenants who are renting furnished accommodation and have difficulty in affording their rent have the prospect of getting a measure of assistance towards it.
  The House will see that the Bill seeks to widen the scope of the rent allowance schemes which local authorities have been required to operate since 1st January. Largely for that reason, but partly to facilitate the consolidation of housing legislation, the Bill takes the form of a series of amendments to the two principal Acts. The amendments are contained in the two schedules—Schedule 1 for

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  England and Wales and Schedule 2 for Scotland. I appreciate that this way of doing things makes the Bill a little difficult to follow, and I apologise for that. To assist the House we have produced in the form of a Cmnd. Paper, Cmnd. 5183. a textual memorandum which shows the relevant provisions of the two principal Acts that would appear if the proposed amendments in the Bill were made. I hope that right hon. and hon. Members will find the document helpful in understanding what is proposed in this measure.
  On the best estimate that we can make there are about 600,000 furnished lettings in England and Wales. In Scotland, as the House will know, they form a much less significant part of the housing pattern. There are only some 28,000 in Scotland.
  Dr. J. Dickson Mabon Dr. J. Dickson Mabon (Greenock)
  rose——
  Mr. Channon: The hon. Member for Greenock (Dr. Dickson Mabon) will be able to make his point if he catches your eye, Mr. Speaker.
  Of the 600,000 furnished lettings in England and Wales, some 40 per cent. are in Greater London. There is a particularly heavy concentration in the Inner London boroughs of Camden, Kensington and Chelsea and Westminster. Outside London in the South-East there is a relatively high proportion of furnished lettings. There are probably just over 100,000. The remainder are scattered more or less evenly across the country. Birmingham, for example, has approximately 20,000. There are smaller concentrations in Manchester. Liverpool, Leeds and Bristol.
  The furnished tenant population is extremely varied. It includes both the very rich and the poorest. Furnished tenants in general are younger and more mobile than those who live in unfurnished accommodation. The tenants survey undertaken in the London conurbation in 1970 for the Francis Committee showed that the head of household in furnished tenancies was under 25 in about 43 per cent. of such tenancies, as opposed to 15 per cent. in unfurnished lettings. In a further 35 per cent. of furnished lettings the household head was under 35. Over
  228
  60 per cent. of the furnished tenants interviewed in the survey had moved into their accommodation in the previous 18 months, and only 9 per cent. had rented their home for more than five years.
  In London in particular, and to a lesser degree in other big cities, there are many young single people, typically four or five, sharing a flat, among whom there is a heavy turnover. As well as that, there are many single people of all ages in rooms. Sometimes they are lodgers sharing some of their accommodation with the landlord or other tenants. Some of them are in furnished accommodation because they want a base only for a short time, perhaps to do a seasonal job or for an extended holiday. There are many variations to which attention can be drawn if one looks at single people who have furnished lettings as their accommodation.
  Apart from single people there are also families. We must help these families. Indeed, we must concentrate on helping them with rent allowances. About a quarter of all furnished tenancies are occupied by families. Among these families are some of the poorest in the country. They live in furnished accommodation because that is the only type of housing they can get. Although overall the proportion of households with children tends to be lower in furnished accommodation than unfurnished accommodation, in the stress areas of London, where the great problem largely exists, the tenants survey found that 49 per cent. of furnished lettings were occupied by families. I am only too well aware that all too often these families are living in entirely unsatisfactory conditions. Far more people in the furnished sector are living in a room or rooms than in a flat, and overcrowding is more prevalent.
  I think that the House will agree that the furnished tenant population is very varied. As many hon. Members will know, and there are many hon. Members present representing the London constituencies, the pressure on furnished accommodation is in places very severe. I hope that we can start on the basis that there is general agreement on both sides of the House that in all our policies paramount consideration must be given to avoid doing anything that will make the position of these people any worse. We must do what we can to improve it.

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  I turn briefly to the main provisions of the Bill. Clause 1 requires local authorities to vary or replace their existing rent allowance scheme in April so as to take account of the amendments proposed in that scheme by the Bill.
  Dr. Dickson Mabon: I take it that the Minister will later return to what is not in the Bill; namely, the implementation of the recommendation of the Francis Committee. I have been misled by Ministers, perhaps not unintentionally, that the recommendation of the Francis Committee would be incorporated in the Bill. Will the Minister explain that matter at some stage? Perhaps he will proceed to argue against the Francis Committee's recommendation.
  Mr. Channon: With great respect, the hon. Member may have confused the position. I shall deal with security of tenure because that is included in the reasoned amendment put forward by the Opposition. I shall deal with that later. The Francis Committee recommended very strongly against security of tenure.
  Dr. Mahon: I did not refer to that.
  Mr. Channon: Then I do not know to what recommendation the hon. Gentleman referred. I will turn to the points raised in the reasoned amendment raised by the Opposition. If I fail to cover the hon. Gentleman's point, no doubt he will interrupt me again.
  Dr. Mabon: Unless I have completely misread the Bill, and it is not an easy Bill to follow, I understand that recommendation 26 on page 226 of the Francis Committee's Report, which was published in March 1971, will not be implemented in the Bill. That recommendation is that furnished tenancies will be brought into the fair rents system. I am not referring to the minority recommendation of Miss Lyndal Evans relating to security of tenure. I want the Minister to tell us why he is not incorporating recommendation No. 26.
  Mr. Channon: What I am doing is meeting a genuine wish on both sides of the House—there may be argument about whether it is being fulfilled—as expressed repeatedly in the debates on the Housing Finance Bill, that we should extend the system of rent allowances from
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  unfurnished to furnished tenancies. This is not a Bill to reform the structure of the furnished rented sector. If it were, it would be much bigger, wider and more complicated. It merely extends the provision of rent allowances to the furnished sector, as my predecessor was pressed to do.
  I will deal with security of tenure, because that is raised in the Amendment, but this is a limited Bill, which I do not pretend is the last word in the furnished sector. However, it is well worth supporting for what it contains.
  Mr. Bruce Douglas-Mann: We are to have amendments to Section 25 of the Housing Finance Act, under which, in effect, the Bill will work on the assumption that the scarcity factor will be 20 per cent. There will be considerable differences and anomalies if we have two separate systems for rent assessment—one under the rent tribunal and the other under the rent officer. I hope that the Minister will deal with the arguments for not accepting the recommendation of Francis—we will come on to the other argument about security later—that the two systems should be assimilated because the resulting anomalies will make the system almost unworkable in high-stress areas where the differentiation between the regulated rate and the furnished rate is much greater than 20 per cent.
  Mr. Channon: I understand the points raised by both hon. Members. The House will recall what my predecessor said about the recommendations of Francis last year and the Government's wish to legislate in due course about Francis. This Bill does not do that, and that may be a point of criticism. It is a limited measure to extend the provisions of rent allowances to the furnished sector. It does not attempt to deal with some of the other recommendations of the Francis Committee with which, no doubt, the House will want to deal on other occasions. I am sure that we shall come in due course to all the recommendations of Francis. This is a rent allowances Bill, not a rent Bill—
  Dr. Mabon: This is perfectly in order.
  Mr. Channon: I am not saying that it is out of order; I am simply saying what

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  I am doing. What hon. Gentlemen seek to argue is a matter for them.
  To return to what the Bill does rather than what hon. Gentlemen say it should do, Clause I requires local authorities to vary or replace their existing rent allowance schemes in April to take account of the amendments in the Bill. Local authorities will have to widen the scope of their rent allowance scheme to apply to furnished as well as unfurnished tenancies. April is the earliest by which it would be reasonable to expect them to take on this additional task.
  There will be considerable work for the small number of authorities with a large number of furnished lettings in their area, but if local authorities want to grant allowances earlier than the mandatory date, there is nothing to stop them, if the Bill is enacted, just as a handful did for some unfurnished tenants at the beginning of October rather than at the beginning of January.
  Because the Bill provides for furnished tenants to get rent allowances under an extension of the existing scheme, most of the arrangements in that scheme will apply to furnished tenants in exactly the same way. The rules for the calculation of an allowance will apply. There will be the same needs allowance, for example, and furnished tenants will benefit from the same date as will unfurnished tenants from the increase of £3·50 in the needs allowance which my right hon. Friend announced last week.
  Tenants who already qualify for a rent allowance will be entitled to a larger allowance than previously envisaged. For example, a married couple with two children and a weekly income of £35 and a rent of £4 do not at present qualify for an allowance. Under the new scale they will be entitled to one of 49p. My hon. Friend will be delighted to give many other examples if required, when he winds up.
  The administrative arrangements for applications and grants of rent allowances provided in the earlier legislation will apply, and furnished tenants will have exactly the same rights and safeguards as unfurnished tenants.
  On the point which has worried some local authorities, the provision in Section 8 of the Housing Finance Act for paying rent allowance subsidy will apply to
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  allowances paid to furnished tenants on precisely the same basis; that is to say, up to 1975–76 the Government will meet 100 per cent. of the cost and from 1976–77 the rate of subsidy will be at least 80 per cent. or any higher percentage that may be specified.
  Any improvements on the model scheme which a local authority has imported into its allowance scheme will apply equally to furnished tenants and there will be the same scope for the authority, within certain financial limits, to grant somewhat more generous allowances in individual cases of special hardship than its scheme provides for.
  But there are two respects in which the rent allowance scheme will operate rather differently in regard to furnished tenants. These take us to the heart of the Bill, for these are the issues which have been much the most difficult to resolve. They are: which tenants should be eligible to claim an allowance?; and: how much of the rent paid by the tenant should fall to be met by an allowance? As in the case of unfurnished tenants, we have based our definition of furnished tenants on the Rent Act, and the Bill applies to persons who occupy a dwelling under a contract under Part VI of the Act.
  We have also included "boarders". Part VI of the Rent Act does not extend to contracts where the rent includes a payment for board which forms a substantial proportion of the whole rent. But it seemed to us that rent allowances should be extended to persons whose rent includes payment for one or more meals, because there may well be people in this situation who should get help with their rent.
  Now we come to the dilemma, and it is a very real one. I see from the amendment that the Opposition are suggesting that we should give allowances to all furnished tenants who qualify, I suppose on the relevant income grounds—[Interruption.] If I have misunderstood, no doubt this will be made clear, but the amendment refers to the "restricted" provision in the Bill. If that applies only to the amount, there is no dispute between us. But if it means that every tenant who qualifies on income grounds should get an allowance, there is a difference, and it is

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  an important point which I should explain to the House.
  We can surely all agree that the problems of the great pressure on the furnished sector are acute—in particular, the problems of the large number of families who live in furnished accommodation—and what I am not prepared to do is anything which will make those problems worse. If we gave rent allowances to every furnished tenant, there would be even greater pressure on the furnished rented market and we could make the task of helping those who need help even more difficult. I hope and believe that that would be the wish of the whole House, and I am sorry to see, if I have understood it correctly, an alternative point of view in the amendment.
  Therefore, we have defined certain categories of qualified persons. A qualified person is defined in paragraph 10 of Schedule 1 either as someone whom the local authority is of the opinion would suffer hardship if the allowance were not granted or as someone falling within a description specified in regulations made by the Secretary of State. There are two categories. The general category of hardship and those who fall within the regulations.
  We really must start cautiously, because the increases allowed by the Bill are not those that would be necessarily laid down for all time. There is plenty of scope for extension, and the House may express a view on that. What we must not do, by giving grants of rent allowances to all tenants of furnished accommodation, is to create a situation where those families in furnished accommodation find it more difficult. We must be prepared to consider extending the scope of the scheme when we have some experience of its operation. That is why we have provided that anyone who the local authority considers would suffer hardship without an allowance should be eligible. That also explains, partially, why we are seeking power to prescribe in regulations rather than in the Bill—which would otherwise have to be a much larger enactment—those categories of tenants who will be eligible as of right.
  We are here breaking completely new ground in providing rent allowances for tenants of furnished accommodation, and
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  if the House wishes, we shall be able to alter or to add to the categories as time goes by. My right hon. Friend proposes to prescribe the categories in regulations, which the House will have the opportunity of praying against if it so wishes. Also, I should like to have the views of the Advisory Committee on Rent Rebates and Rent Allowances, which is to be set up under Section 23 of the Housing Finance Act and which my right hon. Friend hopes to appoint shortly.
  I must give the House some indication of what use, at least at this stage, we intend to make of the powers.
  Mr. Clinton Davis: In dealing with questions of definition, is not the Minister aware that the Francis Committee was at pains to point out that there was great uncertainty at present in defining a furnished tenancy and made a specific recommendation about that? Is not this an appropriate time, therefore, to consider this aspect of the matter at the very least?
  Mr. Channon: That may be the view of hon. Members. The Government have expressed their views on the Francis Committee recommendations on repeated occasions. All I am saying today is that I am trying to introduce a fairly modest measure; I am not trying to transform the whole of the furnished rented sector. That is a task which may well come but it is not one I am asking the House to approve today. If hon. Members wish to deal with that aspect, no doubt they will seek an appropriate occasion.
  Mr. George Cunningham: I think I am right in saying that the Government have not so far found an opportunity of doing anything about the Francis recommendations. In respect of one of the recommendations, the Government said that they would find the first legislative opportunity to give effect to it, and they had to be shown an opportunity to give effect to it. With this Bill coming up, surely some of the more modest recommendations of Francis, which are most relevant to the Bill, could have been fitted in without transforming the Bill from a modest measure into a major housing measure.
  Mr. Channon: I cannot agree about that. Once one started upon the road of

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  Francis—a road which, perhaps, we all ought to follow—it would become a very important Rent Act indeed. This would be a quite different Bill and a Rent Act. That might be something worth doing, but that is not what I am doing today.
  It is always easy to criticise Ministers for not producing Bills that they have not produced, but perhaps I may be allowed to deal with the Bill we have produced. Perhaps hon. Members are trying to get off on to Francis. Today I am asking the House to accept that the Bill is a very substantial step forward for furnished tenancies, and I hope that people will not demean it. I pay credit to the hon. Member for Islington, South-West (Mr. George Cunningham) for his noble efforts in dealing with the problem of harassment and the part he played in that. He will be glad to know that the new penalties can come into force, and we shall debate that on a suitable occasion.
  Our object is to concentrate this new form of help on those tenants who have clearly established that they have settled down in furnished accommodation and are making their home there, and who are most readily identifiable as being in need. With that in mind, our thoughts at present are that these categories of tenants would be entitled to allowances as of right, if they qualified on grounds of rent and income: first, all families with children, including all single-parent families, who have been living in the local authority's area for at least six months; second, all old-age pensioners or tenants whose wife or husband is of pensionable age and who have been living for a similar period in the authority's area; third, all tenants with the same residential qualification who have a pensioner in their household. Fourth, there are the single tenants and the couples who have no children and no older people living with them. That is where the real difficulty comes. For them, I believe that there must be a longer qualifying period of residence in the authority's area and, perhaps, an age limit. But this is something on which I shall value the views of the House and the help of the advisory committee. I believe that this is the right approach, at least to start with. But we will, as we must, consult the advisory committee on our proposals before the regulations specifying the categories are
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  made; and naturally I shall listen to the views expressed as the Bill goes through Parliament.
  All those furnished tenants in these specified categories will be eligible to claim an allowance as a right. In addition, local authorities will have a duty to grant a rent allowance to any furnished tenant who in their opinion would suffer hardship if he were not granted an allowance. The Bill provides that local authorities should arrive at their opinion in accordance with such guidance as may be given by the Secretary of State.
  This provision is not an attempt to muzzle local authorities and to remove any effective discretion from them. It is there at the request of the local authority associations, because they realised that otherwise there would inevitably be wide variations between one authority and another, which would be very undesirable. Our guidance will be given by way of circular. Again we shall put our proposals before the advisory committee, and I shall be glad to take account of any suggestion that hon. Members may make But we shall be prepared to amend the guidance as our experience of the scheme increases.
  At present we intend to include among those who should be regarded as likely to suffer hardship any tenants who are registered as chronically sick or disabled or who have someone so registered in their household. We shall also include tenants undergoing psychiatric treatment or who have been recently bereaved or separated. There will be other similar groups. There would be no restriction of residence or age in any of these cases. It is unlikely that our guidance will be able to deal with all the possible cases, and local authorities will have discretion to deal with those not mentioned in the guidance as they think fit in the light of our advice.
  To sum up, local authorities will grant rent allowances to all those in hardship categories as I have described. All pensioners and all those with families will get allowances and there will be some single people who do so as well. We shall keep under permanent review the qualifying categories. But the important point is that all those in hardship will qualify.
  Mr. Michael Meacher: On the question of the categories, will the Minister confirm that cross-reference from paragraph 22 of Schedule 1 would seem to indicate that tenants of rented residential caravans will be excluded? Will he explain why, because these undoubtedly include some of the very poorest people?
  Mr. Channon: To save the time of the House, perhaps my hon. Friend will deal with that when he winds up the debate.
  I must come now to the second main difference that the Bill provides for—which I think hon. Members have been criticising—in the operation of the rent allowance scheme in relation to furnished tenants. That is the calculation of the amount of rent which is eligible to be met by an allowance. The relevant provisions of the Bill are paragraphs 17 and 26 of the First Schedule. I will try to explain the effect of these paragraphs as simply as I can.
  I am sure that there will be no disagreement that a rent allowance should not be paid on that part of the rent which is paid for the furniture, otherwise the tenant of furnished accommodation would be at considerable advantage over the tenant of unfurnished accommodation. It would place an extremely heavy burden on local authorities if they were expected to assess the value of the furniture in a dwelling and to deduct an appropriate amount on that account from the rent being paid. On the other hand, to base the rent allowance on the fair rent that would be fixed for the dwelling if it were let unfurnished would work to the tenant's disadvantage. There is widespread agreement that the rent for furnished accommodation contains an element that is not reflected either in the fair rent that the dwelling would command if it were let unfurnished or in that part of the rent which is paid for furniture. I could detail the reasons why that is so, but I do not think that the House disputes it.
  The problem we had to face was how to allow for this in the rent, and what we have done, with the agreement of the local authority associations, is to assess it at one-quarter of the fair rent that the local authority estimated that the dwelling would command if it were let unfurnished. The amount of rent eligible to be
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  met by an allowance is therefore, subject to two provisos, 125 per cent. of the estimated fair rent for that dwelling if it were let unfurnished. That would be the amount eligible for allowance. The two provisos are, first, that that sum-125 per cent. of the fair rent—should not exceed the rent actually being paid by the tenants, and that is obvious; second, that it should not exceed any reasonable rent that may have been fixed for the accommodation as a furnished letting by the rent tribunal.
  If a tenant is paying £6 rent for a furnished letting and no reasonable rent has been set for it and, let us say, the authority estimates the fair rent for the dwelling let unfurnished at £4, the amount towards which rent allowance would be payable is 125 per cent. of £4; that is, £5. On the other hand, if the authority assesses the fair rent at £5, the 125 per cent. figure would be £6·25 but, as it cannot exceed the amount actually paid, the allowance would be payable in that case towards the rent of £6. It is extremely difficult to know that the 125 per cent. figure is right. It is very difficult to obtain evidence on this, and difficult to obtain evidence to the contrary.
  We may find, after experience of the scheme's operation, that a higher or a lower proportion of the estimated fair rent would more properly reflect the facts of the situation. Again we should alter that amount by order, and any such order will be made by Statutory Instrument subject to negative resolution.
  I know that many hon. Members think that the most important part of the Bill is that which deals with the take-up of the allowance for which it provides, and I share their concern about rent rebates. The figures from a cross-section of local authorities are very encouraging. On average, about 35 per cent. are getting rebates compared with our estimate that about 35 per cent. to 40 per cent. would qualify.
  Mr. Reginald Freeson: The Government's figure was 40 per cent.
  Mr. Channon: We said 35 per cent. to 40 per cent. If I am wrong I apologise, but I seem to remember saying that.
  When it comes to rent allowances for private tenants, the picture so far seems

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  to be less satisfactory. Initial response has been slow, but the scheme has been operating for only three weeks so far and it is bound to take time to build up. We were always aware that this would be a problem. We are advertising it extensively—we are spending £600,000 on it in the current year—and we shall continue to give publicity to it by every means. If any hon. Members have new ideas for publicising the scheme I shall be glad to hear of them. If, however, one finds that the take-up is unsatisfactory, that is no reason for not proceeding with the scheme. What we must do is to increase the take-up.
  Mr. Julius Silverman: The hon. Gentleman may be interested in the Birmingham take-up because for nearly four years the city has been operating a scheme of providing allowances for furnished tenancies, and it has been operating the new scheme since 1st October. Out of an estimated figure of more than 18,000 furnished tenancies, the take-up is 21 or less than one in a thousand.
  Mr. Channon: If those figures are right they point even more to the need for take-up. I do not think that the hon. Gentleman is arguing that we should not have the scheme.
  Mr. Silverman: No.
  Mr. Channon: The hon. Gentleman is saying that we should be more concerned about take-up, and I shall be glad to hear any suggestions that he has to put forward for ensuring that the take-up is improved. We can all make destructive points. I want to hear constructive points about how we can increase take-up, because that is what we all wish to achieve.
  Mr. Silverman: My contention is that without security of tenure the scheme is nearly meaningless.
  Mr. Channon: With respect to the hon. Gentleman, he did not give the take-up for unfurnished tenancies.
  Mr. Silverman: That, too, is very small.
  Mr. Channon: If that figure also is low, it means that security of tenure makes little difference to the hon. Gentle-
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  man's calculations. I am sure we all want to ensure the largest take-up we can, and any ideas for bringing that about would be welcome.
  As for furnished tenants, there should be no need for them to hold back from applying through fear that their landlord may get to know and will know of their financial circumstances. An application for a rent allowance is a confidential matter between a tenant and his local authority, and so the landlord can and should be quite unaware of such an application. Even where a fair rent has to be estimated, in the great majority of cases this can be done without the landlord's knowledge. We shall stress this point to local authorities after the Bill is enacted.
  Some hon. Members will say—indeed, the hon. Member for Birmingham, Aston (Mr. Julius Silverman) said it a moment ago—that none of this is of any avail unless furnished tenants are given full security of tenure. I understand that to be the view of the Leader of the Opposition and no doubt it is shared by his colleagues. I have considerable sympathy with those hon. Members on both sides of the House who want to improve the lot of furnished tenants, and I understand the view of those who say that the answer must lie in extending full security to furnished tenants, but I must ask the House to reflect on all experience in this field. The Government are not prepared to contemplate any measure which might, in a short time, seriously prejudice the well-being of hundreds of thousands of tenants. I must therefore ask the House to look at the evidence.
  Who would benefit, and who would lose, if there were full security of tenure for furnished tenants? It is obvious that the beneficiaries would be existing tenants—or, at least, existing tenants who were satisfied with their accommodation. But who would lose? The Government believe—and I shall come to the evidence in a moment—that to give full security for furnished lettings would lead to an immediate and irreversible loss of accommodation. Empty property would be withdrawn from the market, and since the furnished sector includes a high proportion of transient tenants the amount of property which the landlords would take off the rented market would grow very quickly.

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  The losers, therefore, are existing tenants who need to move, perhaps because they have changed jobs or because of growing families. But if there is no accommodation to let on the market, they will not find the fact that they have security where they are of any help. Similarly, people arriving in London from other parts of Britain and from abroad, students coming to university, people whose jobs have been temporarily switched to London, and new families—all these people might find that there is no room for them within the private rented sector. It will be more—not less—difficult to find accommodation. The result could well be not reduced homelessness, which we all want, but more homelessness, and no one can accept such a risk lightly.
  I may be right or wrong, but every report on this problem since the war has come to the conclusion that I have advanced to the House. The history of rent control provides little comfort for those who believe that the housing shortage can be solved by regulation. Homelessness in the end arises from a shortage of supply of housing. It is a problem which, thank God, is not local, but it is ghastly and acute in parts of the country, and in particular in London.
  All the evidence is that rent control in itself reduces the supply of rented accommodation. Unfurnished accommodation in the private rented sector has shrunk to under 3 million tenancies. The latest evidence in London, derived from the 1971 census, is that unfurnished accommodation for renting is declining by as much as 50,000 dwellings—or nearly 10 per cent.—a year. On the other hand there has been some growth in the furnished sector, though it does not compensate for the decline of unfurnished accommodation. This reflects a situation which the whole House must recognise. I do not think anyone can pretend that it is an easy issue. Whatever the short-term benefits of giving full security to furnished tenants, the longer-term result will be a significant and severe reduction in the availability of accommodation. All history shows that to be so.
  I agree with those hon. Members who are disturbed by the implications of this
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  evidence. This is what the Francis Committee—certain portions of whose recommendations hon. Gentlemen opposite want me to implement—meant when it gave a solemn warning against extending full security to furnished tenants. Whatever we think of the committee and its recommendations, there is no doubt about the importance that it attached to this recommendation and to the solemn warning that it would be a disaster to attach full security to furnished tenancies. This was not a committee which I set up. It was set up by the hon. Member for Willesden, East (Mr. Freeson) when he was in office.
  The House knows that the previous Administration did not deal with this problem of security of tenure for furnished tenants, and I think that the consequences of extending help to the extent suggested by the Leader of the Opposition—and it may be suggested by the right hon. Member for Grimsby (Mr. Crosland) this afternoon—must be faced fairly and squarely. I am not prepared to do anything that will make the situation worse rather than better. The right way to do something for furnished tenants—I accept that they need extra help—is to assist them through the Bill by providing rent allowances. We are not abandoning furnished tenants. On the contrary we are helping in a real and practical way and in full awareness of our responsibilities for ensuring an adequate supply of accommodation.
  The Opposition amendment refers to the increasing homelessness in the stress areas of our cities. I am as concerned as anyone in the House that there should still be people in this country who, for whatever reason, find themselves homeless.
  Yesterday my right hon. Friend the Secretary of State for Social Services and I had a meeting with the London boroughs to discuss with them some of the problems related to homelessness and what could be done to deal with the problem of homeless families. This is in many ways the most worrying aspect of the problem, and therefore the one on which the London working party, set up after the reports on homelessness, concentrated its first report.
  The right answer is easier to state than to achieve. It is to find these people a

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  proper and permanent home. In the long run this is indistinguishable from the overall problem of adequate housing in London to meet all the needs for it, and on this problem my Department has been working continuously with the London boroughs and with my hon. Friend with his action group for the last two and a half years. In the short term, however, solutions to family homelessness must be found within the limits set by the existing housing stock. The most urgent immediate action is therefore to probe and to use every means to ensure that all accommodation suitable for family housing and which is or could be made available is brought into use to help with this problem of homelessness.
  Most London boroughs have already adopted many of the recommendations of the London working party on improving their organisation and means of helping the homeless. Yesterday we discussed a wide range of possible ways of bringing every suitable dwelling into use. The London boroughs and the GLC are following up a number of suggestions and we plan to meet again soon to continue, together, our drive on this problem, which is a serious and ghastly one.
  Although we concentrated yesterday on family homelessness, we are all conscious of the major and growing problem of homelessness among single people as a whole. I am making an urgent study of possible solutions to this problem and hope to have an early and full discussion with the London boroughs and the GLC and to put proposals to them at the earliest possible date.
  Mr. Freeson: With regard to the meeting with the London boroughs yesterday, was it not the case that all, or at least most, of the London boroughs represented at the meeting expressed the view that the biggest single cause of homelessness is the insecurity of families in furnished accommodation and that the biggest single immediate step that could be taken to help the authorities as well as the families concerned would be to introduce security of tenure for such families?
  Mr. Channon: That view was expressed by one member at the meeting. It did not represent the unanimous view of
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  either political party in the London Boroughs' Association.
  Finally, I must say how sorry I am, although it is for the Opposition to decide, that they are putting forward a reasoned amendment to the Bill. I believe it to be a Bill which will provide limited—and I accept that—but nevertheless extremely valuable help to some of the worst-off members of our society. It is rather hard that we should be criticised as we are in the Opposition's reasoned amendment. When the Opposition were in power they had plenty of opportunity to tackle these problems of rent allowances or security of tenure, but they gave no help whatsoever along these lines to furnished tenants or, indeed, to unfurnished tenants.
  I hope very much that in spite of the reasoned amendment, about which I know hon. Members opposite feel strongly, the House will give a Second Reading to the Bill and that it will be thought right to allow us to have it in reasonable time, because I think we are all agreed at least that it is important that furnished tenants should receive help at the earliest practicable date. I confidently commend the Bill to the House in the belief that it represents a limited but nevertheless a further important advance in housing policy and one which certainly deserves the support of the House of Commons.
  4.22 p.m.
  Mr. Anthony Crosland: We shall not vote against the Second Reading of the Bill tonight and we shall not obstruct it in Committee. Nevertheless, we have put down a reasoned amendment on which we shall divide the House tonight because we find a number of aspects of the Bill to be deeply disappointing and inadequate. There has for a long time been a great interest, not confined to one side of the House, in the position of furnished tenants and particularly in the different treatment meted out to them as against unfurnished tenants concerning not only security of tenure, but, when the Housing Finance Bill was introduced, in relation to the private rent allowance and on the last occasion in relation to the freeze, from which furnished tenants were altogether excluded.

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  The Labour Government—and I concede that, no doubt, we should have acted earlier—commissioned two important studies which bore centrally on the position of the furnished tenant. First, in April 1969 my right hon. Friend the Member for Coventry, East (Mr. Crossman) commissioned Professor Grieve to conduct his investigation into homelessness in London. That report was completed in June 1970 and, following a rather squalid squabble as to whether the Government were to publish it, was eventually published in January 1971. That report demonstrated, to the surprise of none I imagine, that one of the main reasons for the increased problem of the London homeless was the shift from the more controlled unfurnished sector to the less controlled furnished sector. The Labour Government, as the Minister has mentioned, also set up the Francis Committee in March 1971, and they certainly conducted the most massive discussion of the problem of the unfurnished tenant, although certainly not all their conclusions satisfied us on this side of the House.
  The Minister referred to the background to this Bill, which is really the almost unanimous chorus of protest when the Housing Finance Bill was published at the fact that furnished tenants were excluded from the new private rent allowance. It was almost exactly a year ago, on 20th January, that my hon. Friend the Member for Kensington, North (Mr. Douglas-Mann) moved an amendment in Committee to include them, and the hon. Member for Hemel Hempstead (Mr. Allason) moved a similar amendment, and the Government were saved from defeat, I believe, only by the Minister's telling us that a mysterious Committee was already working at it and that something would arrive in due course. Now something has arrived—namely, this Bill.
  It is important first, as the Minister rightly said, to examine the characteristics of the people we are trying to help. He gave a number of useful figures, and I should like to supplement one or two so that the House may have a fair picture of who the furnished tenants are.
  As the Minister said, there are only 600,000 of them, but they form a par-
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  ticularly significant group because they are, broadly speaking, paying the highest rent, out of the lowest incomes, for the worst accommodation. As to the accommodation, according to the Francis Report, it has a number of characteristics. It is expensive, averaging even at the time the Francis Committee was sitting £240 a year, or 33 per cent. of the typical take-home pay of the tenants, compared with only 19 per cent. of income for corresponding tenants of unfurnished private accommodation. Its quality is very low. Most furnished lettings are small; 50 per cent. of them have only one or two rooms—66 per cent. in stress areas. Most of them have shared amenities; 78 per cent. in stress areas share a lavatory compared with only 44 per cent. in unfurnished accommodation. They are overcrowded: in 55 per cent. of rent tribunal cases the tenants are living at a density of 1½ persons or more per room.
  As for the tenants themselves, I am glad the Minister has corrected some misapprehensions about what kind of people they are, because his predecessor was always using phrases such as "birds of passage", "fly-by-nights", and so on, as if they consisted almost entirely of single persons. In fact, they do not. As the Minister pointed out, many families are involved; 49 per cent. of lettings in the stress areas are to families which, far from being mobile and transient, find it extremely hard to escape from the sector; and 55 per cent. of tenants in the stress areas are coloured immigrants whose prospects of better housing are limited by prejudice as well as by low income. The result is that many tenants stay in this sector for years. The recent Shelter report found that 20 per cent. had been in the same accommodation for five years or more.
  The truth is that, as the Francis Committee found, there are really two separate groups of tenants in furnished lettings. There is a group such as the Minister described—typically young, single, mobile people—and there is also a group consisting of poor families forced to rent furnished accommodation in the stress areas because access to anything else is for one reason or another denied to them: they cannot afford a mortgage; they cannot get a council house because the waiting list is too long. I agree with

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  the Minister that it is this latter group, the most deprived group in our cities, whose future should properly concern us most.
  The question is whether this Bill will fulfil the objectives that I think all of us have in mind. First, who will it cover and who will be eligible? Here the Bill itself gives us very little idea because this is all to be defined in the provisions referred to by the Minister, in paragraph 10 of Schedule I, one provision depending very much on guidance given by the Secretary of State and the other provision waiting to be filled in by regulations that have not come to the House. He gave us a number of examples of categories he intended to be included. I find it difficult to comment on them at the moment because he has the characteristic of speaking extremely rapidly. That makes his speeches very enjoyable but also makes it difficult to follow a detailed argument, so we shall have to reserve judgment on the categories he intends to include in the Bill, although these may be obvious to some of my right hon. Friends, who reacted quickly to certain omissions.
  It is interesting that Shelter estimated, on the basis of the Government's previous pronouncements, that probably half the furnished tenants would be excluded from the private rent allowance. I hope that the Under-Secretary, when he comes to reply, will give us some estimate of the broad proportion of furnished tenants he thinks will be covered by the Bill.
  To the second question—whether for those who are covered the help will be adequate—the dogmatic answer must be "No". The crux of the matter is that the amount of rent to be taken into account in calculating the new allowance will be unrelated in many cases to the actual rent. This is made clear in paragraph 17 of Schedule 1 and by the Minister's description this afternoon. The rebate will be based on the occupational element of what will normally be the lowest of the three criteria mentioned in paragraph 17, namely, the local authority's estimate of what the fair rent for the dwelling would be plus 25 per cent.—or, as the Minister said, 125 per cent. of the fair rent.
  It is this provision which has given rise to many of the doubts about the
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  adequacy of the Bill. My hon. Friends will doubtless have worked out a number of examples of how the provision will operate in practice. I take an example which I have checked and which is a typical Inner London one. It is that of a man earning £25 a week and living with his wife and child in two poor, seedy furnished rooms. At current rent levels he will be paying at least £5·50 a week. If the Government really wanted to help him, his allowance would be based on that figure, the rent which he is actually paying. With the increase in the needs allowance recently announced, he would get more than £2·50 under the new rent allowance scheme. But under this Bill he will not get an allowance which is based on the rent which he is actually paying. He will get an allowance based on the fair rent plus 25 per cent., a rent which will be nearer £2·50 a week. As it is on that rent that his allowance will be calculated, instead of getting an allowance of £2·50 he will get an allowance of well under £1 towards the £5·50 he is actually paying.
  It is this meanness in the calculation on which the allowance is based which explains why the estimated cost of the scheme is so low—only £5 million to £8 million. We do not know what this will mean per person, because we do not know what proportion of furnished tenants will be eligible and, if eligible, will claim. Taking an imaginary and unrealistic calculation, if the whole £8 million were paid out between all the households living in furnished accommodation it would amount to an absolutely trivial sum per household. Even halving that gives a sum which will come as a considerable shock to furnished tenants when they learn it.
  In this context it must be remembered that part of the burden of alleviating poverty is after 1975–76 to be put on to the rates and on to local authorities. This is a point to which we strongly objected in all the discussions on the Housing Finance Bill.
  Considering both the calculations which can be made as to how the scheme will operate and the total figure of £5 million to £8 million, it appears to us that we shall be giving to this sector, which contains many of the poorest citizens, a

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  degree of help that is disproportionately low compared with what rightly goes to the council tenant and to the owner-occupier.
  Our third reservation concerns the administration of the scheme which in practice will be very complicated, particularly in those areas with the highest concentrations of furnished tenants. Local authority officers, who are already very hard pressed as a result of the Housing Finance Act, will have to work out individually fair rents as the basis for the new allowances. There will have to be a great deal of guesswork and ad hoc-ery. Then at the end of the day—I do not envy them this part of their task—they will have to explain their calculations to angry tenants who expected to get a rebate based on their actual rent rather than on the hypothetical rent which is much lower. Many people in local government believe that if there were to be a high take-up under the scheme the scheme would be almost unworkable.
  My fourth point relates to the problem of take-up, to which the Minister rightly devoted much attention. I fear, as most commentators have done, that far more likely than a high take-up is a very low one. Rebates for unfurnished tenants and council tenants are obviously much simpler than the new furnished rent allowance. I take one example which I checked a few days ago. In October with a great blaze of publicity Lambeth launched the new post-Housing Finance Act scheme of rebates for council tenants and for private unfurnished tenants, yet Lambeth has still had only 600 applications out of 20,000 who it is estimated are eligible.
  The Birmingham scheme has been referred to today, as it has been referred to on many other occasions. I will not repeat the figures, because I hope that my hon. Friend the Member for Birmingham, Aston (Mr. Julius Silverman) will give them in detail. We all remember the disappointment expressed publicly, again almost exactly a year ago, by Mrs. Freda Cocks, Chairman of the Birmingham Housing Committee, about how the scheme has worked out in terms of take-up.
  If, despite fair rents, council tenants are not applying, and if unfurnished tenants
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  whose rents are simpler to calculate are not applying, how likely are furnished tenants to apply? We know from the Francis Report that 55 per cent. of furnished tenants do not have a rent book. We know that many landlords of furnished tenants who are in breach of some stautory requirement or other are often terrified of officialdom, and the sight of a local authority officer snooping around in the course of his duty trying to assess a hypothetical fair rent could well be enough to provoke the dreaded and familiar notice to quit.
  I agree with the Minister that all of us, given the scheme, want a high take-up. My fear is that, whether from ignorance, out of fear of the landlords reaction, or out of pride, furnished tenants will not have the take-up to which they are entitled under the Bill.
  The Minister said that it is no good our expressing this fear in a negative way, and it would be unattractive for me to do so. The Minister asked what positive suggestions we had. I have come increasingly to the view that to rely on advertising campaigns, however massive, even using such sophisticated media as the television channels, will have only a limited effect. Where there is a very high geographical concentration of furnished tenants—this eases the whole problem of take-up—I am very attracted by the idea of the Child Poverty Action Group that the Government would get better value for money if they stopped television advertising and paid two or three field officers in certain areas, perhaps people from the Action Group, who could visit tenants who are affected. The employment of extra people might well have far more effect than the huge cost of a vast advertising programme.
  I turn lastly to the fundamental question of security of tenure. The Labour Party's position on this question is unambiguous, though I concede that the Labour Government did not put it into effect. It was made clear in the party's evidence to the Francis Committee and was reaffirmed in the party's programme published last summer. I quote:
  "We believe further that most furnished tenants should be given legal security of tenure. We reaffirm, as our evidence to the France Committee on the Rent Act stated, that furnished tenants should have the same security as is now available to unfurnished tenants."

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  Before considering the arguments for and against, it is worth stressing the degree of insecurity that now exists. Nearly one-third of furnished tenants applying for a reduction in rent before getting a notice to quit received less than six months' security from the rent tribunal. More than one in five applying after receiving notice to quit got no security of tenure at all. A recent Shelter report, the one by Mr. Bebb on rent allowances for furnished tenants, showed an average security of 3·8 months at the first application and 1·9 months at the second application. In many of the worst areas of central London tenants know that an application to the rent tribunal is the most certain road to homelessness.
  There are three arguments against security of tenure—or, perhaps more accurately, two—the first being divided into two parts. The first and most obvious is that to which the Minister alluded when he said that greater security of tenure would simply dry up the supply of rented accommodation. This was the majority view of the Francis Committee which stated:
  "For the reasons we have indicated we cannot recommend such extension. On the contrary, we venture to sound a solemn warning against it."
  The Minister referred to the phrase "solemn warning". It is interesting to see what evidence the Francis Committee had for giving that solemn warning. The Committee's view that security of tenure would produce a reduced supply of rented accommodation was based on the stated intention not to rent, if security of tenure were introduced, of a minority of a small sample of landlords, most of them small lettors.
  The Minister used a more powerful argument, although I found it no more convincing, basing himself not on a sample but on various statements about how the decline in the private rented sector has been due fundamentally to security of tenure. Anyone who has examined over the past few years the relative financial advantages of selling as opposed to renting does not need to look anywhere else in order to explain the decline in the private rented sector. The huge financial advantages now to be gained by selling as opposed to continuing to rent are overwhelming, and this in my view has been the decisive factor
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  in the decline of the private rented sector. I believe it will be the main reason for the decline which will continue. I hope that it will be hurried along by the next Labour Government, but it will continue anyway.
  So I find myself unconvinced by this argument and I, like most of my hon. Friends, accept on this point the view of Miss Evans in the minority report. She argued that once security of tenure was provided it might be impossible for landlords not to go on letting. What else can be done with the rooms? They are usually quite unsaleable.
  A curious fact about this argument is that the majority, although they gave a solemn warning, had the honesty to say:
  "there is no 'evidence'—in the sense of facts based on actual experience—that such a reform would reduce the supply. But equally, there is no evidence that it would not. It is largely a matter of personal judgment."
  That is the fact of the matter and most of us here, particularly my hon. Friends with experience of areas with a concentration of furnished tenancies, believe that there is no evidence that security of tenure would dry up the supply of cheap rented accommodation.
  There is a much more difficult and serious argument than that. It is that security of tenure might lead to landlords choosing tenants, as they might put it, more carefully, and in particular excluding some already very hard-pressed groups, such as unmarried mothers or immigrants. That is a serious danger, and it means that security of tenure would have to have as its corollary a policy of building up housing associations to cater for precisely such groups, and also much greater flexibility in local authority allocation procedures.
  At any rate, although I accept that there is an argument here, I nevertheless come down for security of tenure on three fundamental grounds. The first is logic. I agree with Miss Evans, and again I quote the minority report:
  "The present distinction with regard to security between the unfurnished tenancy and the furnished tenancy … is wholly illogical as a basis for differentiating between the degrees of security given to residential tenants."
  My second ground is one of equity because under the present system it is the

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  least well off who have the least protection, and the result is much of the misery and hardship that exists in central London.
  Thirdly, and this is highly relevant to the Bill, I believe that the rent allowance scheme will not work without security of tenure. The tenant will be better off by £x as a result of the new allowance; the landlord will increase the rent by the same £x and if the tenant is not prepared to pay the landlord will find ways, as he frequently does these days, of getting rid of the tenant and finding a new one who is prepared to pay. So, without security of tenure the new allowance will be a straight subsidy to the landlord and will have the effect of forcing up furnished rents generally.
  I conclude that the Bill is not radical enough to solve the problem of the furnished sector and the private rented sector generally. We need far more urgent measures. We need security of tenure, an increase in the supply of low-rented accommodation and a systematic programme of municipalisation.
  We shall not vote against the Bill tonight because half a loaf is better than no bread, but in our view the Bill does not measure up to the desperately serious situation which exists in the furnished rented sector.
  4.44 p.m.
  Sir Brandon Rhys Williams: I begin by congratulating my hon. Friend on the speed with which he has solved the problem of extending to furnished accommodation the allowances which are beginning to be paid in the unfurnished sector.
  The Government made a pledge to hon. Members on both sides of the House who wanted the furnished tenants to benefit from the Housing Finance Act. There were experts who thought it could not he done. The two speeches we have heard so far today have dealt with the problems of where we go after the Bill rather than the problems which are likely to arise from its implementation.
  My hon. Friend mentioned that the Borough of Kensington and Chelsea has a high concentration of furnished lettings. I believe that my constituency has the highest proportion of people living in
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  furnished rooms of any division in the country. I am certain that I speak for those people when I say that they are pleased that the Government have pushed ahead to deal with this complex problem and have come forward with a solution which they intend to implement so quickly.
  The attitude of the Opposition will not be readily understood in South Kensington any more than their attitude to the Housing Finance Act has been understood. The extension to all poor people of the benefits of housing subsidies instead of concentrating them on people living in particular districts or particular local authority properties is obviously right. I am sure, therefore, that the Opposition will find with the passage of time that they have gravely misinterpreted public opinion. I believe that they are basically opposed to the extension of housing subsidies to people living outside the local authority sector.
  Hon. Members: No.
  Sir B. Rhys Williams: I am delighted that they are coming round to the principle—which many of us on the Conservative side have advocated for many years—of subsidising the family, not the house—if that is indeed the conclusion to be drawn from those interjections.
  This is an appropriate occasion on which to remind ourselves of the purpose of housing subsidies. Obviously, they must ensure that all families are able to afford a fair rent and so to provide the only ultimate solution to family homelessness, which is to ensure that families are at least able to afford the rent in all circumstances. The social services have not fully solved the problem of the low-paid man with a family. The national insurance system aims to provide subsistence income—or more—to a man who is out of work because he is sick or injured or retired or for other reasons. But, although attempts have been made for a long time to find ways of subsidising a man who is in work but who still cannot afford to keep and house his family, we have not until now found our way to eliminating family poverty, particularly in areas where rents are high. I most warmly commend the Government's efforts under the Housing Finance

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  Act and this Bill to find a solution to the problem.
  The purpose of housing subsidies goes beyond the narrower purpose of ensuring simply that there is enough money in every family to pay the rent. It goes beyond that to the point where it seeks to equalise the spending power of the family and the single person without dependants who has the same income. That is why I would not especially object if the Government were to insist initially that single people without dependants should not be eligible for housing subsidies under the Bill.
  Certainly in Kensington, and I think it is true elsewhere, the upward pressure on rents often comes from groups of single people who are able to put more into rent than family people, particularly when they club together and make a home consisting of perhaps four or five wage-earners without any dependants. It is very often they who are making the running, and I do not think that the Government need to give priority to their interests in considering housing subsidies.
  I want to say a few words about take-up. This is a subject which I have studied in connection with other social benefits. I am convinced that in the long run we have to work our way to an elimination of the means test or perhaps to make the income tax mechanism the means test to end all means tests. The assessment of income by local authorities will probably always be an unpopular process, at any rate to many of the people potentially entitled to benefit through local authority schemes.
  It is certainly inefficient for assessments of income to be made firstly through the Pay As You Earn mechanism or whatever may succeed that in due course on a national basis and then by local authorities as well. There is an element of duplication in local authority assessment which I am certain we will eventually find has to be eliminated. Although I commend my hon. Friend's intention of drawing the attention of all who are eligible to the benefits under the new housing subsidy scheme, either in furnished or unfurnished accommodation, and pressing local authorities to do the maximum—this is naturally the right course in the short run—I hope that we
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  can look ahead to a system where the entitlement to subsidies for householders is integrated in the general national system of tax credits.
  Possibly it is worth pressing a point about the householders' allowance which I have made in another connection. The aim has been suggested of treating men and women equally in the eyes of the State for national insurance benefits and tax credits. If we are examining the problem of substituting the personal allowance in the tax system for a positive payment to individuals the need to find a unisex solution becomes all the more obvious. We have to recognise that in the personal allowance in the tax system there is a concealed housing subsidy and there possibly always has been, consciously or unconsciously, from the start.
  Having created a tax system at the end of the 18th century which gave especially large concessions to householders and a further, but not quite so large, concession to a householder with a female dependant, we are recognising that outgoings on housing are a special commitment to the wage earner. The State has recognised the housing element in deciding how much taxation people can bear. The same principle has been applied from the start in national insurance in that a single pensioner receives more in proportion per head than a married couple. There is a single household element included in the pension paid to the single person which is not repeated in calculating the pension of a married couple. The same applies with sickness and unemployment benefit, and so on.
  I would like to see the Government's great step forward in extending housing allowances to such a much larger number of people taken right across the board in the tax credit system so that men and women can be treated singly and the only differentiation that needs to be made is to provide for the single householders in the group. This is an ultimate solution to the problem of take-up. However much my hon. Friend and local authorities may work to draw attention to the benefits available under the Housing Finance Act and under this Bill, take-up will always be somewhat disappointing while people feel that they have to go through the motions of submitting to a means test from their local authorities.

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  Apart from that contribution on the question of take-up which has been of a somewhat long nature, although I hope not inappropriately so on Second Reading, I believe that this is a very useful start. Possibly the scale of allowances could be made more generous with the passage of time. This is something which this or other Governments will be able to consider. This Bill is a welcome solution to a serious problem and an honest answer to a popular pledge.
  4.56 p.m.
  Mr. Julius Silverman: In discussing this subject it is well to take advantage of experience which we already have in this country. This is why I shall refer to Birmingham. It is not that I am taking a constituency view. Birmingham has a good deal of experience of private rent allowances. About four years ago it promoted a Private Bill to introduce allowances in the private sector, and I believe that it is the only city which has done so. This scheme catered not only for unfurnished tenancies but for furnished tenants. It is well to see what has happened.
  On 1st October, having such a scheme in operation, Birmingham decided to bring into operation the private rent allowance scheme on the scales contained in the Housing Finance Act—three months before they were supposed to come into operation. Birmingham has therefore had three months' experience of the new allowance, and it has continued to apply the allowance to furnished tenants too. It is interesting to see the results.
  The general take-up in the private sector has been disappointingly low. Before this Act came into operation the total number involved was about 250. It has now rather more than doubled but this is out of an estimated number of 60,000 private tenants. That is a very disappointing take-up. It means a take-up of about 1 in 100. I am not surprised, in view of our experience in Birmingham, that generally speaking the take-up in the private sector throughout the country is low. I do not believe that this scheme will bestow upon people in the private sector the immense benefits which the Government claim.
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  There is no doubt that many more tenants will have their rents increased by the provisions of the Housing Finance Act than will receive rebates under the Act or this Bill. Take-up in the private furnished sector is particularly low. After the new scheme had been in operation for almost four months there were 21 furnished tenants using it out of an estimated number—based on the last Census figures—of 18,400 private furnished tenants in Birmingham. That is probably an underestimate because the Census would have had great difficulty in getting round to all private furnished tenancies. This means a take-up of about 1 in 1,000, which is derisory.
  Why is this? Obviously the Government must concern themselves with this because otherwise the scheme will become a meaningless gimmick. There has been a fair amount of publicity of the Birmingham scheme. No doubt there could be more, but that is not the answer. A scheme which has been in operation for four years and publicised on two or three occasions might not result in an enormous take-up but we would expect more than this derisory amount. My view, based to some extent on experience, is that the main factor is the lack of security of tenure.
  Throughout the whole of the privately let sector and especially in the furnished sector there is this basic insecurity of tenure, this fear of the landlord, the idea that people had better say nothing and keep a roof over their heads. I do not think it applies only to the furnished sector, but it applies most of all there.
  Mr. Arthur Jones: Is it a fact that the landlord would get to know that the tenant had applied for a rebate?
  Mr. Silverman: I would say that he would almost certainly get to know. There would have to be an assessment of the furniture. Someone would have to visit the house.
  Mr. Arthur Jones: I was thinking of the unfurnished sector.
  Mr. Silverman: In that case I would say that quite often the answer is "Yes", and in a sense that is quite right. When a tenant goes for a rent allowance he is asked what rent he is paying. If he

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  says that he is paying a grossly excessive amount the council tells him to go to the local rent officer. Otherwise he would not get the benefit of the allowance on the full rent that he was paying. The local authority in Birmingham has had the co-operation of the rent officer in deciding what the fair rents of these private dwellings should be. It is almost certain that the landlord would get to know, but even if he does not the tenant fears that he will.
  There is, however, a still greater fear in the furnished sector, where there is practically no security of tenure. If the tenant goes to the local authority the fear is that he may be out on his neck. He will get very little security if he goes to the rent tribunal. I do not say that this is the only factor, but I am certain it is the major one.
  My right hon. Friend the Member for Grimsby (Mr. Crosland) said that under the Bill, as under the Birmingham scheme, the furnished tenant is given an allowance based not upon the rent that he pays but upon a notional rent, upon what would be a fair rent if the value of the furniture were eliminated.
  Let us see what happens. People come to see me sometimes about rent but more often about a council house, and I learn incidentally what rent they pay. A woman in a two-room attic pays £4 10s. a week rent. Upon the present fair rent basis the room might be worth about 25s. If she went to the council and asked for an allowance she would get an allowance based upon the 25s. She would not get perhaps a few shillings and it would not be worth her bother. That has to be balanced against the danger of insecurity, bearing in mind that the landlord can put up the rent next week and bang go the few shillings. This allowance might operate as a subsidy to the landlord, especially the sleaziest landlords who would take advantage of the Bill to put up the rent.
  We could send out people house by house to discover what is happening, but we shall not get a significant take-up unless we solve the problem of security. I reject the recommendation of the Francis Committee upon this point. The conclusion the Committee came to was an astounding one bearing in mind the evidence it received. It is clear that
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  unless we can achieve a much greater degree of security for furnished lettings the Bill will be the next thing to a dead letter. I hope the Bill succeeds because we need a mitigation for these people, but so far there is not much evidence that it will succeed unless the basic problem of security is solved.
  5.7 p.m.
  Mr. Arthur Jones: The Bill is further evidence of the Government's policy to aid those in need and to do so selectively so as to ensure the best possible use of resources. I recognise it as a tentative move but one which is in the right direction.
  I was interested in what the hon. Member for Birmingham, Aston (Mr. Julius Silverman) told us about the moves which Birmingham made a year or so ago. It has been interesting to see the result, in both the unfurnished and the furnished sectors. We should recognise that this move was introduced when Sir Francis Griffin was the Conservative leader of the Birmingham City Council. The whole country was grateful to that important authority for the initiative it took. In the context of our discussion, the fact that the take-up figure has been such a derisory one is disappointing, and it shows the problems which face the Government in the implementation of the Bill.
  I do not share the view of the hon. Member for Aston that it is insecurity of tenure that lies at the root of the problem. In my intervention I asked whether the landlord would be likely to get to know that an application had been made. The great advantage of the scheme proposed by my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams) is that under a taxation rebate system there would presumably be much less chance of disclosure to the landlord.
  People are reluctant to apply for aid, not only for housing aid but for social security payments. The right hon. Member for Grimsby (Mr. Crosland) spoke about the Child Poverty Action Group, which he suggested might have a rôle in making the facilities provided by the Bill known to tenants. But local authorities with their welfare services and housing departments have a much greater opportunity of contact with their communities as a whole than could be secured by the Child Poverty Action Group or Shelter.

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  The effort of those groups is concentrated in small sectors, whereas local authorities have a greater opportunity for publicising information more widely. I agree that there is a problem and that we have not yet found a solution to it.
  I welcome the outline proposals of the Bill and the latitude of its terms in the appointment of an advisory committee on rent rebates and rent allowances which will enable the whole concept to be continually monitored and provide ways and means for its improvement and extension. I also welcome the considerable discretion which is proposed for local authorities. Here there is a much more positive rôle for local housing authorities to play than is generally recognised.
  The Opposition's motion alleges that in not extending the provisions of security of tenure and rent regulation the Government are adding to the problems of homelessness in the stress areas of our cities. I find that wording very strange. On page 135 of the Francis Report two separate groups of furnished tenants are noted. The first comprises those households often of single persons usually without children who wish to remain mobile and independent. The second group consists largely of families, with children, who are too poor to buy houses, cannot find unfurnished accommodation to rent within their means and cannot obtain a council house. The cheapest accommodation available to them is a furnished room in a rundown area. It is essentially those two groups of people which most of us have in our minds.
  The motion alleges that the lack of security of tenure and improved rent regulation for tenants is the biggest cause of homelessness in the stress areas. That statement is open to challenge. Other factors have to be taken into account such as the shortage of accommodation, concentration in urban areas and people's wish to live in cities. We have heard no evidence to substantiate the terms of this unfortunately worded motion. It is at best misleading and, in my opinion, incorrect. It appears to try to blacken a measure which is essentially directed at helping those in need. I was interested to hear the right hon. Gentleman's proposals, but we need to look to a positive contribution by local authorities in making these proposals effective. The Bill is
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  a palliative, but it is a genuine effort to make progress in this desperately difficult sector. The Opposition motion is false both in substance and supposed intention.
  We have had a constructive debate, and I am sure there will be widespread and genuine welcome and support for the Bill.
  5.15 p.m.
  Dr. J. Dickson Mabon: I should like to be as agreeable as I can before coming on to further remarks later. I compliment the Government on the fact that we are debating the Bill with the White Paper, Cmnd 5183, which sets out in a novel way what would be the position of the law if the Bill were to be incorporated in the present housing legislation. I do not know whether the Government intended to be helpful to the House of Commons or whether they wanted to help themselves by anticipating what the position would be under the consolidation which they say they are to carry out soon. Whatever the motive, I welcome the textual memorandum, which enables us to understand what will be the consequences of the Bill.
  I am not distressed about the Bill. I think it is very good as far as it goes. No doubt efforts will be made in Committee to seek to strengthen it. I am concerned that the Minister seemed not to be willing to discuss what was not in the Bill. That is perfectly in order on Second Reading, and it is possible that in Committee we might seek to move new clauses or new parts to make a good Bill better. That is not an unknown parliamentary experience, even under this Government. I suggest that the Minister could have devoted part of his speech to telling us the circumstances in which the Bill is introduced and why certain matters are not included.
  We do not know officially, but we know from the Lancaster House conference that certain consequences will fall on the legislation because of the prices and incomes policy which the Government are pursuing. In putting down a Question I was told by the Table Office that I could not refer to the Lancaster House conference and that I had to refer to statements made by the Prime Minister. Unless these are lodged in the Library I cannot make reference to them. The Minister should have told us the

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  effect on tenancies and rent allowances and on the two Acts of Parliament which are mentioned in the Bill of the Lancaster House statements, the White Paper and the Counter-Inflation Bill, which we shall discuss on Monday.
  There has been a postponement of the application of certain sections of the Housing (Financial Provisions) (Scotland) Act. On page 10 of the White Paper there is a reference to Clause 16 of that Act, which reads:
  "It shall be the duty of every local authority to bring into operation not later than 1st October 1973 or such earlier date …".
  The original date in the Act was 1st January 1973. I assume that the reason for the amendment is not only to enable allowances for furnished accommodation to be organised but to scoop up some of the Prime Minister's references to the postponement of certain applications of fair rents, and so on, which attract rent allowances in the private sector. The Minister should have told us a little more about this. It is contained in the Bill but is alluded to only by the reference to the changed date.
  The other matter to which I wish to refer is fair rents. The Minister did not properly acquit himself in discussing the recommendation on assimilation.
  Mr. Channon: I hope the hon. Gentleman will not be unfair to me, and no doubt he will come to his less agreeable remarks a little later. The Bill deals with furnished lettings and the payment of rent allowances. It has nothing to do with the local authority sector, the private unfurnished sector or fair rents in the public sector. Had I dealt with all those matters, my speech would have taken not 40 minutes but three hours, and I am sure the hon. Gentleman would have complained at a speech of that length.
  Dr. Mabon: Three hours even of the hon. Gentleman would be too much, but I wish he had taken another half an hour because he did not cover these points adequately. He obviously wants to be a good Minister, but is not doing too well so far.
  Is it or is it not a fact that there are changes in the operation of the fair rent system in respect of certain controlled properties? Is that not being referred to in this Bill, which seeks to amend the
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  earlier legislation? Perhaps I should read what was said by the Prime Minister at Lancaster House about the Governments earlier housing legislation to demonstrate that there are to be certain changes in operating the Acts. Should we not have had some reference to this situation, or must we wait until tomorrow's debate?
  Mr. Channon: The hon. Gentleman may be under a basic misapprehension. The Bill deals only with furnished lettings. It does not deal with anything else. It deals not with the local authority controlled sector or with the regulated sector but with furnished lettings. Surely I was not expected to deal with those other matters in a speech which related entirely to furnished lettings.
  Dr. Mabon: I have been in the House a little longer than the Minister, and I know from previous experience that it is in order in a debate of this nature to deal with the operation of other Acts and to discuss whether amendments on other matters should be made in Committee. The Minister may wish only to discuss furnished lettings, but it does not follow that the House of Commons wants to leave the matter there. It would be arrogant for the Minister to assume that we must discuss only what he wants us to discuss. We might want to add things. The date has been changed as applying to schemes affecting private tenants who occupy houses. The date is no longer 1st January 1973 but can be 1st October 1973
  "or such earlier date as the Secretary of State may by order appoint".
  I was hoping that the Minister would explain the consequences in respect of the two earlier pieces of legislation in the light of the Prime Minister's remarks at Lancaster House. A great deal of misunderstanding has arisen from what was said by the Prime Minister, and there is a genuine need for information. I hope that the Minister will now make amends by asking his ministerial colleague who is to reply to the debate to tell the House what is happening.
  Our criticism of the two earlier Acts of Parliament was that they were inflationary, though we concur in the social good represented by the bringing in of rent allowances and subsidies. I am sorry that the hon. Member for Kensington,

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  North (Sir B. Rhys Williams) is no longer present, because I should like him to explain his remark that rent subsidies and allowance have been part of Conservative policy for years. If that is the case, why did they fail to implement that policy in Parliament in earlier years. When the Labour Government introduced a series of substantial housing Bills, including the major Rent Act of 1965, the then Conservative Opposition failed to table any amendments to carry forward the concept of rent allowances and subsidies. I am not taking away from them credit for what they have done in the last year, but I challenge the claim that they have pursued this policy for years. One or two Liberal Members might wish to lay claim to this idea, but certainly the Tory party cannot lay claim to it.
  It must not be said that we are uninterested in the extension of subsidies and allowances, for we welcome the Bill as far as it goes. However, it is not good enough to say that this should be the end of the matter. The Minister tried to argue that he could not consider recommendation 26 of the Francis Committee because it was a complex matter which would involve a very long Bill. I am certain that the Opposition would have facilitated the passage of a Bill which sought to bring in many of the Francis recommendations.
  My right hon. Friend the Member for Grimsby (Mr. Crosland) in an admirable speech said that it was the people in furnished rented accommodation who were paying the highest rents. If they are paying the highest rents, then they will also have the highest rent allowances. We shall be subsidising directly and substantially one of the worst sectors of private housing. The more the State pursues the fair rent system—and it is a system with which I agree—and applies allowances and subsidies in helping tenants within the system, the more the State will have to be concerned with the well-being and upkeep of the properties and ultimately with their ownership.
  Perhaps local authorities should go into the furnished rented sector. I agree that there are bound to be certain consequences if we bring the furnished tenancy sector within the fair rent system, although I feel that they would not be
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  as bad as the Minister suggests. I believe that many people who operate furnished tenancies would welcome such a system. The argument that security of tenure would destroy this system is fallacious. There is other evidence to show that this is not the situation.
  I am not campaigning on the question of security of tenure. My complaint is that the Minister has failed to bring in one of the recommendations of the Francis Committee. The Minister rightly said that there are some Francis Committee recommendations which he wants and others he does not want. He also knows that we in our hearts want some of those recommendations rather than others. We are not bound to accept suggestions made by such a Committee.
  The Minister said that he and his predecessors had made clear which of the Francis recommendations were endorsed by the Government. That is news to me. I would love to see set out in HANSARD a list of the recommendations which the Minister accepts on behalf of the Government and those which he rejects. I should like to know when the Minister intends to legislate on those recommendations. Will the Government adopt the excuse that because of the consolidation measure which is due and because the Government have already produced other housing legislation, they cannot bring forward another Bill to implement the Francis recommendations? It is annoying to see the Minister postponing action again and again.
  In an intervention I complained that I had been misled by Ministers, and perhaps it is my fault not theirs. During the passage of the Bill when we all, Conservative and Labour Members, joined in demanding this kind of reform, I understood that the Bill would be more substantial than the present measure. The Under-Secretary of State will not mind my saying that I thought that there might be two separate Bills and, the consequences being more complicated for the English Bill than for our own, that it might be helpful to take the Scottish Bill first. I can assure the hon. Gentleman again that we on this side of the House would have facilitated its passage.
  I am disappointed that the Bill is as restricted as it is. From time to time the Government tell us that it is our fair

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  rents system. That is true. But it is our fair rents system in disrepair. The landlords in charge of the system—the Government—have not been able to attend to their fair rents system properties for a good five years. The last time that we debated the fair rents system was in 1968, when we were dealing with what has become the 1969 Act.
  References are made to the 1971 Rent Act. But we know that that Act was simply a consolidation measure. It is a summation of all the Acts preceding that. The fact is that we ought to have an amending Bill dealing with the fair rents system. There are numerous respects in which it is defective. On occasion the Under-Secretary admitted small marginal amendments to our Housing (Financial Provisions) (Scotland) Bill when we debated it in Committee. But he would not pretend that he has dealt with the Francis Committee's Report as it applies to Scotland.
  That is my complaint to the Minister. He may say "I cannot possibly produce a Francis Bill just like that, and this must come first." But he should have taken the consequences of this Bill as it affected furnished properties and applied them to this Bill as well.
  I have had experience in the housing section of the Scottish Office and with my hon. Friends in the old Ministry of Housing. I cannot believe that the draftsmen there have been telling Ministers that the implementation of recommendation No. 26 is so complicated and fraught with Parliamentary pitfalls that it would be unwise to include it in this Bill. The Minister has a reputation for being an honest man. If he thought that I was wrong in that assertion I am sure that by now he would be on his feet telling me so. I take his silence as being contentment rather than contempt, and I urge him seriously to look at this matter again.
  We shall not get very far in the argument about security of tenure. Therefore, I shall vote for the reasoned amendment because I believe profoundly in what my right hon. Friend the Member for Grimsby said about the need for security of tenure in this sector. But, obviously, we shall not get very far. However, it is not partisan or unreasonable to expect the Minister to make this
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  change in the Bill and include that recommendation of the Francis Committee now. We cannot keep postponing implementation of the Francis Committee's Report. It has to be implemented some day—I hope with its minority recommendations as well.
  5.33 p.m.
  Mr. James Allason: The hon. Member for Greenock (Dr. Dickson Mabon) challenged my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams) about what my hon. Friend said was Tory Party policy—
  Dr. Dickson Mabon: For years.
  Mr. Allason: I can assure the hon. Gentleman that it has been Tory Party policy for a great many years that there should be substantial rent rebates for local authority tenants and that rebates should go to those who most need them rather than being spread over the whole mass of local authority tenants. That is rather similar to the views of the right hon. Member for Coventry, East (Mr. Crossman), who complained about the privileged position of local authority tenants. However, when the right hon. Gentleman was Minister of Housing he did not succeed in getting his way, and we have had to wait until the election of this Government for some reform and to see that at last rent rebates go to those most in need.
  Rent allowances to private tenants were thought to be impracticable until Sir Frank Griffin succeeded in making them work in Birmingham. We have heard that they are not working as well as Sir Frank would have liked. But it is a practicable proposition. The Conservative Party has been able to steal Sir Frank's clothing and make it a success. I think that he was a willing ally to that theft.
  I have to declare an interest here as the owner and manager of property which includes the furnished sector. I welcome this short Bill. I am sorry that it could not be included in the original Bill. At the time it appeared that there were considerable difficulties. First, when thinking of furnished tenancies one thinks of short-term and holiday tenancies. One tends to forget the long-term furnished tenancies which exist in considerable numbers Then when one turns to the longer-term

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  tenants one thinks of the bachelors of both sexes who share accommodation. There are numerous cases where five or six bachelor girls club together to share a flat, and it would be very difficult to nominate one as the tenant and to say that because of her low income she should be entitled to a rent allowance simply because she happened to be the tenant of furnished property. Where there is clubbing together it has to be recognised There is great difficulty in definition—
  Mr. Douglas-Mann: There are provisions under the Housing Finance Act for a member of a household to be chosen as the representative tenant. Therefore, the hon. Gentleman's example can be overcome under the existing provisions of the Housing Finance Act.
  Mr. Allason: The hon. Gentleman is confusing the issue slightly by that statement. He is referring to the case where the nominated tenant is someone with a very low income when there is a dependent member of the family with a substantial income. There are many retirement pensioners who happen to be tenants but have sons or daughters earning substantial incomes living with them. It is ridiculous that the income to be considered should be that of the original tenant.
  The situation is entirely different when five bachelor girls all earning similar salaries club together in a flat, nominating one as the tenant. However, there is a solution. The Minister can make regulations about the categories of persons who should receive help and give permission to local authorities to consider those who are in hardship. By doing that, the initial difficulty which had kept the furnished tenant out of the provisions of the Housing Finance Act has been overcome.
  During the passage of the Housing Finance Act strong views were expressed. As the right hon. Member for Grimsby (Mr. Crosland) pointed out, in Committee on 20th January last year a number of amendments were moved. It so happened that the only workable amendment was the one that I tabled where I said "Forget about the furnished rent. Think about what the rent would be if the premises were unfurnished and let us work on that." This received the agree-
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  ment of the Opposition. I think that had the then Minister been prepared to accept it there and then, it would have been incorporated in the Bill. As it is, instead of the figure of 100 per cent. on the unfurnished basis, we now have a figure of 125 per cent., which costs more, but I welcome that higher figure, and is the result of greater experience of the situation. Obviously the Government had to consult local authority associations. In consequence, there has been this period of slight delay, but we now have an even better scheme than that which I suggested, and I welcome it.
  The right hon. Member for Grimsby suggested that this scheme should be considered a subsidy to the landlord—we have had this nonsense before—as the rent allowance is a subsidy to the landlord. However, it is quite different. The change has been moving the subsidy from the house to the family. Therefore, the landlord does not look for the poorest possible tenants in order that they shall have assistance with their rent and he will receive it. If anything, if he has a choice, he will probably go for the wealthiest tenant who can best afford to pay the rent. Therefore, it is nonsense to suggest that as soon as the tenant receives help with his rent, because he is in poor financial circumstances, thereby the landlord benefits. He does not. It is the tenant who benefits in those circumstances. So let us forget that rather silly slogan that we heard again today.
  Security of tenure is mentioned in the reasoned amendment. Again, the right hon. Member for Grimsby said that it must be a matter of personal judgment whether there would be a loss of accommodation resulting from the introduction of security of tenure. I entirely agree. Let us consider it.
  First, accommodation in people's homes. Can anyone really believe that if security of tenure is granted to a lodger in someone's home the householder will continue letting in those circumstances? One can imagine a householder getting somebody in who appears to be a perfectly charming tenant but who, as soon as he is in and has security of tenure, becomes an absolute fiend. We all know that this happens.
  Mr. Freeson: Does the hon. Gentleman know of any person in authority who

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  has considered this subject who has recommended the granting of security of tenure to lodgers?
  Mr. Allason: I use "lodger" in the rather general sense. The Francis Committee dealt with letting in a person's home. Technically, a lodger is somebody who rents a room and has access to common parts of the house, whereas a tenant has accommodation restricted to himself. The hon. Gentleman is just nitpicking. I am glad that he has again buried his nose in his papers. However, he knows that security of tenure within a landlord's own home is totally unacceptable.
  I now turn to the second matter of a renting house where the landlord is not in residence and it is a purely commercial proposition for him. As the right hon. Member for Grimsby said, we know that landlords are getting out of the unfurnished sector because it is no longer profitable. The situation now is that they can do far better by selling their houses and lending the money to building societies. They get a better and safer return than by continuing to rent unfurnished properties.
  This is not yet so with furnished property. That is still a marginally reasonable commercial proposition, but there is no guarantee that it will remain so. My own subjective judgment is that if we give security of tenure a landlord may fear that he will get an unpleasant tenant whom he is unable to get rid of and will feel that the game is no longer worth the candle. He will then follow the habit of the unfurnished property landlord of getting rid of the accommodation as fast as he can.
  Mr. Douglas-Mann: How?
  Mr. Allason: By gaining possession and selling with vacant possession.
  Mr. Douglas-Mann: To whom does the hon. Gentleman suggest these houses will be sold? Is there an unlimited number of people who will buy them? Does he accept that to dispose of property one needs both a market and a willing buyer? Has the hon. Gentleman considered the figures quoted by Miss Lyndal Evans in the minority report on the breakdown of furnished tenancies and their suitability for sale or otherwise?
  Mr. Allason: It is usually necessary to obtain possession of the whole house. We are speaking of renting houses which are let off completely.
  The hon. Gentleman asked from where the unlimited supply of purchasers would come. I remind him that only 1½per cent. of our stock of houses is being replaced every year. To my mind this is inadequate, but it indicates that there is not such a vast supply of houses coming forward that a buyer's market is about to develop. There is a huge demand for vacant housing and there will not be the slightest difficulty in getting rid of it. Indeed, I am alarmed at the way that house prices have risen in London. As the hon. Gentleman knows, this situation reflects the demand for houses.
  The reasoned amendment speaks of improved rent regulations in the furnished dwellings sector. We have not heard much about that today. I do not think that it is anything to do with the Bill. I confidently forecast that at some time or other it will be possible to get the furnished and unfurnished regulations more closely interwoven, but surely not in this Bill. The whole purpose of this Bill is to get something through quickly to help tenants of furnished accommodation.
  The speed with which my hon. Friend has been able to move is noteworthy. The unfurnished tenant's allowances started on 1st January, and in England at any rate the furnished tenant's allowances are due to start on 1st April. This is about as fast as would have happened had they been included in last year's Bill. I congratulate my hon. Friend upon both his speed and his humanity.
  5.49 p.m.
  Mr. Bruce Douglas-Mann: I should like to take up two points made by the hon. Member for Hemel Hempstead (Mr. Allason). He referred to what he called the "silly slogan" that subsidisation of tenants is of benefit to the landlords. This has been said on many occasions from this side of the House and in other places as well.
  Like my hon. Friends, I welcome the Bill because it corrects a serious anomaly following the passage of the Housing

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  Finance Act. Whereas the owner-occupier receives tax relief and the council tenant is eligible for the benefits of housing subsidies, to a greater or lesser extent, the private tenant, until the Housing Finance Act, received no benefit. We objected to the exclusion of furnished tenancies but welcomed the extension of subsidies to private tenants. But it would be wrong for us not to acknowledge that if the demand for any commodity is subsidised without simultaneously increasing the supply, the price will necessarily be driven upwards.
  Mr. Allason Mr. Allason indicated dissent.
  Mr. Douglas-Mann: It is a basic and fundamental element of economics which I am sure the hon. Member for Hemel Hempstead does not find so puzzling as his expression suggests. When the amount of money provided to purchase something is increased, unless the supply is also increased the price is likely to rise.
  Mr. Allason: I do not think that the hon. Gentleman would suggest that those who are most in need of help are likely to rush about looking for palaces in which to live. All they seek is help with their rent, which they already find pretty hard to meet.
  Mr. Douglas-Mann: They do find it pretty hard to meet. I am not suggesting, and I am sure the hon. Gentleman knows that I am not, that the Bill will result in people rushing about for palaces. It will, however, enable them to pay a higher rent. Instead of a person paying £5 for a squalid room in North Kensington, the landlord may be able to extort £6. That is extremely likely. Nevertheless, if we have a situation in which the demand is such that the tenant is at the mercy of the landlord and then have these subsidies extended to furnished tenancies—we must look at the Bill in the context of the situation as it is—the landlord will be able to obtain a higher rent than he would have been able to otherwise. Although I warmly welcome the Bill, we must look at it in the context of housing supply.
  A conference was organised by Shelter in November and some interesting papers were submitted which analysed the effect of the subsidisation of owner occupation
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  since the war. The conclusion of the learned authors of a number of papers, which I expect the Minister has seen, was that the subsidies have had an effect in raising the price of both houses and housing land, and have not had a significant effect—certainly they have had some effect—in increasing the supply.
  In considering any further proposal for the extension of subsidies, we must look for fairness between different groups. The Bill is partially remedying the previous unfairness. However, we must realise that by enabling people to pay higher rents than they would otherwise be able to afford, we are necessarily pushing up the price.
  The hon. Member for Hemel Hempstead must have heard the argument in Committee that, given the situation that we have of a certain number of council houses and a certain number of tenants with given incomes between whom the council houses will be distributed, the level of rent will be lower than if the level is set artificially high and then an excess is collected and transferred from one sector of the tenants to enable the others, who could not otherwise afford them, to pay such artificially high rents. In that way the rent is made higher than the market rate. That is what the Housing Finance Act did in relation to both council and unfurnished tenants.
  It is important that we understand what we are doing. We are raising the level of rents in the council and private unfurnished sectors to a higher level than they would have been on the open market. We are doing that by overcharging some people. That can be done with council rents because the Government have created a monopolistic market situation; have raised rents above the market level, and are collecting an excess from those who can pay them and paying it back in subsidies to those who could not possibly have paid such rents if it were not for the subsidy. That is subsidisation of the landlord. Given that situation, and I trust that the hon. Gentleman will not misrepresent what I have been saying, it is essential that we have the Bill. I suggest that the Bill could have been more effective, more generous and more equitable, but a Bill was needed to redress the anomalies created by the Housing Finance Act for furnished tenants.

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  The Bill as it stands only partially meets the needs of furnished tenants. We have had already some discussion about the lack of security of tenure and the effect of that lack. The hon. Member for Kensington, South (Sir B. Rhys Williams) said earlier that the greatest number of furnished tenants were in his constituency. But it is in the borough of which the hon. Gentleman and I represent different parts that the problem of furnished tenancies is one of extreme acuteness. Every week at my surgery I have at least three or four cases of people with notice to quit who are threatened by eviction. That is only a small tip of the iceberg represented by people who are being evicted in North Kensington week after week.
  In North Kensington the local Labour Party has been distributing in large numbers a leaflet which advises people "Do not lose your home". Most people do not realise that when they have furnished rent books they are in most cases unlikely to be classified as furnished if the issue comes before the court.
  The extent and the seriousness of what is happening in the stress areas of London, and the significance of the lack of security of furnished tenants, is alarming. The greater part of the people who come to my surgery are elderly. They are mostly single, widows or widowers. They are mostly approaching retirement age. They have often lived for 11 or 12 years in a furnished room. They are then told by their landlord that he wishes to redevelop the place for luxury flats and given notice to quit. I have two examples which I have culled from today's post. One reads:
  "I find myself, after 11 years of exemplary tenancy with my own furniture and a furnished rent book, in the certain knowledge that the furniture at the beginning of the tenancy was not even worth four months' rent, with a new landlord and imminent eviction. I have now applied for a third term of extension of security, if such it can be called, but do not expect to get it … I might also add that I have tried for 11 months to find myself another home, without success"
  Another tenant, a nurse who is still working at a Middlesex hospital, received a letter from her landlord which said:
  "The rent tribunal which heard your third application today told you that if you applied to them again for an extension of security against the notice to quit which was served on you they would not grant such an extension. I am sure you know that when another tenant
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  refused to leave he was taken to court and was ordered to pay costs. I am sure that you will be able to find somewhere else to live."
  That lady, who is living on a nurse's salary and working in a London hospital, will find the prospects remote of finding anywhere else to live where she will be able to continue with her job or have any connection with the people with whom she has worked and lived all her working life.
  On humane terms it is almost indefensible not to grant such security. I know that the Minister is a man of compassion, although I disagree with him on many things, and I am sure that he would wish to grant such security, but he and his Department have been overborne by the views expressed by the Francis Committee. I would ask him to consider these views with care and pay some attention to an analysis of the evidence upon which the majority came to their conclusion and upon which Miss Lyndal Evans came to hers.
  In the first place, Miss Lyndal Evans, in her minority report, goes into the details of the figures of categories of furnished tenancies which exist and the reasons why she does not consider—I think with good reason—that it is likely that those premises could be put on the market. One reason is that 46 per cent. of the premises consist of single rooms, and it is clearly not practicable to dispose of those. The only parts which would be readily saleable are purpose-built flats and whole houses let furnished.
  The evidence before the Francis Committee was that only 5 per cent. of furnished accommodation in Greater London consists of purpose-built flats and maisonettes and that whole houses let furnished accounted for another 6 per cent. So this was 11 per cent. of the furnished market which could be sold. Clearly, the single rooms could not be sold and almost all the remainder was accommodation in conversions which again is very difficult to sell, because it is not acceptable to mortgagees.
  The hon. Member for Hemel Hemstead suggested that that is all right if the landlord can get possession of the whole house. Of course; but if security of tenure is granted this question is not very likely to arise. I am not sure how it is contemplated that, if the 500,000 households who occupy furnished tenancies

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  were given a right of security in their homes, any significant proportion of landlords could take those out of the market. For the most part, it would not be possible. One room falls vacant at a time.
  I appreciate that some hon. Members opposite feel that it is hard luck on the landlord that his investment should be tampered with by the law in this way. But surely it is much harder luck on the tenants, who, because they have lived all their lives and have their roots in an area which has suddenly become fashionable or desirable—as is happening in North Kensington—find themselves evicted in large numbers.
  Mr. Allason: Is the hon. Gentleman suggesting that the normal furnished tenant in North Kensington has lived there all his life?
  Mr. Douglas-Mann: Clearly, not all furnished tenants have lived there all their lives, but many have lived there for long periods. I would refer the hon. Gentleman to the information in the Francis report, and I think that the Minister said that a significant proportion of furnished tenants have lived in the same accommodation for long periods and, in a large number of cases, in the same area. A substantial proportion of those with whom I have dealings in North Kensington have lived there or in Paddington for a considerable period.
  To revert to the arguments of the Francis Committee, I would refer the Minister to another Shelter report, of a conference held on 13th March 1971, at which Mr. Francis gave information about the reasons for the conclusions that he reached.
  He referred to the evidence given by landlords that, if security were granted to furnished tenants, many landlords would like to get out of the field. That, of course, is nonsense. How, in practice, could they do so? He then went on to make a fallacious assumption:
  "I do not accept that the ordinary landlord will wilfully turn out a furnished tenant for no reason at all. In the vast majority of cases, there is no question at all that most landlords and furnished tenants get on quite well together and that the ordinary landlord will not turn out his tenant wilfully and capriciously, but only because there has been some misconduct on the part of the tenant or because the landlord may have a very good reason for wanting possession."
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  The situation that I can see in North Kensington and that can be seen by almost every Central London Member is that the landlord has a good reason for wanting possession because there are now richer tenants who would be willing to occupy premises that have been a former tenant's home.
  If Mr. Francis regards that as a very good reason, perhaps it explains his report. To be fair to him, however, it is more probable that he did not apply his mind to the situation of the changing structure of our central city areas, that we have large areas—indeed, almost all the areas in which furnished tenancies are concentrated—where property values are changing fast and the character of the neighbourhood either is changing or can be changed.
  It is said that there are 500,000 households at risk. Obviously, it is not as high as that, but in London, where the greatest concentration is, a large number of dwellings are at risk, particularly at the hands of the property developers or speculators who have been buying up properties in North Kensington, including parts like Pembridge Square and Ladbroke Square, which have for many years been respectable middle-class areas, with every third house let off in furnished rooms. Tenants are being evicted in large numbers to enable landlords to turn the premises into furnished flats.
  Anywhere in North Kensington one can see quantities of notices saying, "Sold for conversion to luxury flats". These furnished tenants are being evicted to make profits for the landlords. I cannot accept—I do not think that the House will accept—that it is legitimate to treat the homes of people, whether they are single or whether they have young children, in such a way that they can be told "You must go now, because I can make more money by getting someone else in."
  If the argument advanced by the Minister, his hon. Friends and the majority of the Francis Committee is correct, that the only way to keep private landlords in the market is by ensuring that their tenants have no security, that they cannot go home at night or paint a room or buy furniture in the knowledge that they will still be there in a few years' time, such tenants cannot take pride or

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  have a sense of home in furnished accommodation. If this is the only way in which the private landlord can be kept in the market, it is high time that we got rid of the private landlord. However, I accept that this is not the time to discuss that proposition.
  Miss Lyndal Evans, at page 45 of the transcript of the conference, said:
  "I gave some figures in my minority report; the majority report gives absolutely no figures at all and just bases the whole thing on a hunch. In fact, they say, 'We are convinced', but they do not justify that conviction. I have tried to do so."
  Miss Lyndal Evans continues by referring to part of the furnished market, and I have dealt with the part which could be sold, only a very small part. She says:
  "I do not think that all that much of the furnished sector is saleable or going to vanish from letting, and that some of it will be switched from furnished lettings to unfurnished. … Some small part of it may be modernised and improved—which will be a good thing—and I cannot see what landlords who own these terrible properties that are at present let furnished will do with them if they do not continue to let them."
  I strongly endorse that view.
  I turn from the general point of security and subsidisation to the more detailed provisions of the Bill.
  As the Bill stands, it will not achieve the object that has been claimed for it. The survey on rent levels commissioned by Francis shows the following:
  "Rent levels in the furnished sector were substantially higher for broadly comparable accommodation than in the unfurnished sector. The average weekly rent for furnished 'rooms' was £4·90 (compared with £2·64 for unfurnished) and for furnished flats in converted houses £9·38 (compared with £3·41)"
  Allowing 125 per cent. on unfurnished rent, the £2·64 plus one-quarter is £3·30; £3·41 plus one quarter is £4·26.
  That means that under the Bill's provisions for this typical furnished flat in a conversion, the occupational element will be treated as £4·26, whereas the rent at the time of Francis was £9·38. Thus less than half of the rent will be eligible for rent allowance. That will lead to the situation in which a local authority may say—I do not see how it could do otherwise under the provisions of the Bill—"Having taken the advice of the rent officer, although these premises are let furnished at £9·38, the unfurnished rent would be £3·41, and therefore the occupa-
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  tional element of the rent on which the allowance is to be based is £4·26." How can the local authority make a contribution towards the rent which will be of any significance?
  The only possibility is for the local authority to say to the tenant "Go to the rent tribunal and get your rent reduced." We know from Francis what happens to people who go to the rent tribunal. A year later Francis was able to find only 20 people out of 100 who went to the rent tribunal, and only five of those expected to remain in occupation. Ninety-five per cent. of those who go to rent tribunals are out or on their way out in a year.
  We shall achieve nothing unless, as Francis and my hon. Friend the Member for Greenock (Dr. Dickson Mabon) have suggested, we assimiliate the two codes so that we ensure that rents in the furnished and unfurnished sectors are assessed on approximately the same bases, but with an increase for the furniture of furnished tenants. In practice we have the provisions of Section 25 of the Housing Finance Act, as amended, and it appears that the Government are working on the assumption that the scarcity factor will be 20 per cent. everywhere, that the difference between the occupational element of a furnished tenancy and the unfurnished rent will be only 20 per cent. Clearly, that is not the difference between the open market rent, which is what a furnished rent is, and a rent officer rent, which in large parts of the country is very much greater. The evidence is that at the time of Francis in my area it was 40 per cent., and in practice the difference is now probably very much greater than that.
  It will not work unless we have assimilation and assessment based on similar bases of rent, and also security for furnished tenants who go to the rent tribunal or rent officer to get a fair rent assessed rather than a profit rent.
  Further, it will not work because far too many categories of people are excluded. I heard the categories only when they were react by the Minister, and my notes of them are that they are families with children, old-age pensioners, tenants with a pensioner living in the family, single people without children only if they have a long residential qualification, and any furnished tenants who

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  would suffer hardship in the opinion of the local authority in accordance with the guidance of the Minister, such as the chronic sick and those undergoing psychiatric treatment.
  But what of the hospital porters and nurses? What about the lady I have mentioned, about whom I do not know what to do? Another who recently retired is just about to be evicted and does not know what rent she will have to pay. She has an income from savings of £2 a week and will be eligible for a pension, but she would not have been eligible for rent allowance until about two weeks ago, when she retired from a job in which she was earning only a modest salary.
  The single person family will not be eligible, unless we get guidance from the Minister to the contrary. They will not be covered by the proposals. These categories of people in relatively low-paid occupations in central London—we are anxious on social grounds that they should be able to continue to live in central London—will not be reached by the Bill's provisions.
  Mr. Channon: I thought that the whole point of the hon. Gentleman's case was that the lady had been living there for a very long time. We cannot make too much of the circumstances of a particular case and cannot found an argument upon it, but the sort of case he has mentioned would obviously be covered.
  Mr. Douglas-Mann: I appreciate that the old-age pensioner and the lady who had retired would be covered, coming within the OAP category. But in the period before they retire they would not be covered. I am most encouraged to learn the contrary and look forward to obtaining more detail from the Minister. We have only heard this today, but I trust that the Minister will be interpreting it in such a way as to enable the provisions, limited as they are, to be implemented with reasonable humanity.
  I am glad to see some amendments to Section 24 of the Housing Finance Act which would provide that the landlord would be under a duty to give information to the tenant about the availability of the scheme. Bearing in mind, however, from Francis that the great majority
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  of tenants of furnished accommodation were unaware that there was provision to check the registration of rent, and that in Greater London 74 per cent. of all tenants who were paying rent in excess of the registered rents were unaware of that, I am sorry that the Minister has not taken the opportunity, which becomes important when dealing with furnished tenants, to ensure that there are more effective penalties for charging rents in excess of registered rent, and that rent shall not be recoverable if there is no rent book and if the notices required by the Bill are not provided.
  Those are detailed points which can be more appropriately dealt with in Committee, but the major point is that the Bill, with its restrictions and limitations, is a necessity—given the structure of the housing market—that has been created as a result of the Housing Finance Act. It is necessary to correct the inequalities and inequities that have been created by the Government. But the Bill will not alleviate hardship unless and until we have security of tenure for furnished tenants and an assimilation of the two codes, calculated on the same basis, and a system under which every one in need, whether or not they come within a specific defined category, is entitled to apply.
  The difficulties suggested by the hon. Member for Hemel Hempstead in having a universal scheme would apply equally to unfurnished tenancies, if there were such things in the situation he describes. But the difficulties could be overcome, and I am sure that the parliamentary draftsmen would be able to propose amendments to meet any difficulties that would arise in implementing a fair and just scheme. This is a useful part-measure which we shall support, but it is regrettable that it does not do a great deal more.
  6.21 p.m.
  Mr. S. James A. Hill: It is wrong that every Member who served on the Housing Finance Bill Committee last year is not here this evening to congratulate my hon. Friend the Minister on keeping the promise made by our right hon. Friend the Member for Brighton, Pavilion (Mr. Amery) both in Committee and on the Floor of the House. I thought at the time that the promise would be difficult to keep.

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  Furnished accommodation is in a state of constant flux and it will be difficult to pinpoint the tenants who will be responsible for the rent. Nevertheless, I must congratulate my hon. Friend on bringing forward the Bill.
  Mr. Arthur Latham Mr. Arthur Latham (Paddington, North) rose—
  Mr. Hill: I shall not take long. We know from past experience that the hon. Gentleman is inclined to think of a three-hour speech as an interval of time. I propose to speak for only five minutes, after which the hon. Gentleman will no doubt regale the House with one of the topics with which we were so enamoured in Committee and which helped to pass away the long night.
  I am perturbed that there is no statement in the Bill to the effect that it is the rent officer who will assess the rents. Local government in its wisdom may have the qualifications and the valuation departments to do the job, and they may set what they consider to be fair rents, but those rents may not be the same as a rent officer would set.
  I see that it is to be the unfurnished accommodation assessment with 25 per cent. added. Does that take in the quality of the furnishings? Does it take in the environmental area and the facilities in the block of flats or whatever it is? I am certain that there are anomalies there and that they will be difficult for local authorities to assess.
  It may be made clear in Committee that all these valuations are to be done by rent officers. I know the immense strain already imposed upon them and their staff, and how hard-pressed they are for accommodation, and it may be that local government should not put any further burdens on them. The rent officer in Southampton is conscious of the fact that he does not have enough staff or enough accommodation. He has to deal with hundreds of applications at a time, and in Committee further provision should be made to provide extra finance and accommodation for rent officers.
  With regard to the argument whether landlords will be vicious to tenants or whether tenants will be vicious to landlords, perhaps I may recall the details of a case that arose in my constituency. A woman living on her own with a small
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  child took a tenant into furnished accommodation. Later she came to me because her tenant was selling off the furniture. Even under the present law it took her some months to get vacant possession. By that time the police had been brought into the case, and when my constituent eventually obtained vacant possession—not having received any rent for some time—she found that not only had the furnishings been ill-used but that some were missing. It is not all landlords who are rascals and all tenants who are saints.
  Mr. Clinton Davis: The lady had the right to seek an injunction from the local county court, quite apart from calling in the police. Does not the hon. Gentleman agree that these legal remedies have some value? Does not he also agree that this landlady, who appears to be rather poor, would probably have been eligible for legal aid, and possibly even free legal aid? Were not those remedies sought or even investigated?
  Mr. Hill: The hon. Gentleman is perhaps forgetting that he is a strong, virile, masculine male, whereas this woman was terrified of her formidable tenant. It was only in the last resort that she went to law, because she knew what fury that would arouse. I have mentioned that not as a bone of contention but merely because once in a while somebody from these benches should point out that it is not all landlords who are rascals.
  What the Opposition are going to do about the Housing Finance Act is a matter of conjecture but if, in the event of their returning to power, they rescind the measure, by that time the allowance proposed in the Bill will have made a fine contribution towards maintaining the housing stock. I implore hon. Gentlemen opposite not to destroy for the sake of destroying but to look carefully at this matter. There is a tremendous amount of good in the Housing Finance Act and in each step that has been taken by my hon. Friend, and I congratulate him and his staff on the way in which they have put the Bill together.
  6.27 p.m.
  Mr. Cyril Smith: Perhaps the first thing I should do is advise the Minister that not all the furnished tenancies are in either North Kensington or in greater London. There are other parts

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  of the country in which one finds large numbers of furnished tenancies, and therefore many of us are as interested in the Bill as are London Members.
  The Liberals intend to support the Bill.
  Mr. Joseph Harper: Where are they?
  Mr. Smith: They are where 98 per cent. of the Labour Members are.
  Mr. Harper: Where are they?
  Mr. Smith: From your long experience of the House, you would know that better than I would.
  Mr. Speaker: I am not sure that I would.
  Mr. Smith: I should have said that the hon. Member would know that better than I would.
  Although the Liberals will support the Bill, we agree with the official Opposition that it is somewhat inadequate. It is, however, an improvement on the present situation and I repeat that we propose to support the Government in the Lobby this evening.
  The major weakness of the Bill is that touched on in the Opposition's reasoned amendment. It relates principally to the clause dealing with security of tenure. We believe that this is a major weakness because it could allow landlords to cash in on the subsidies that are to be given.
  I do not subscribe to the view that all landlords are unscrupulous, but that does not alter the fact that some of them are. Under the Bill as it stands, if some tenants are able to obtain rebates and their landlords become aware of that—and there are many ways under the Bill by which that can be done—it is possible, if not in some cases highly probable, that rents will be increased as a consequence.
  I regret too that I cannot accept the Minister's opening conclusions in relation to the provisions that we require concerning security of tenure. I cannot accept that the inclusion of security of tenure in the Bill would necessarily result in a reduction of the number of available tenancies. The first point is that it would not result in fewer houses. Therefore,
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  if one accepts the argument that it would result in fewer tenancies, what the Minister must be arguing is that the houses in question would be put up for sale as a consequence of security of tenure. If that were the case it might very well have the effect of reducing the selling price of houses, because there would be more houses for sale on the market. For my part, that is a risk I am prepared to take in requesting security of tenure for people in furnished dwellings.
  It is debatable too whether a 25 per cent. allowance on the net rent allowance for furnishings and fittings is sufficient. I am advised that in some parts of the country the figure should certainly be 50 per cent. and that in other parts it may well require to be 100 per cent. I hope that the powers which the Minister has in this matter will be used.
  I cannot understand why there should be two systems of fixing furnished rents—the existing rent tribunal and, now, the new local authority rent officer system. The existence of two systems can only increase the ad hoc nature of the way that furnished rents are set at the present time. I suggest that the Bill is liable to lead to inflationary tendencies in rents and I think that that also is to be regretted.
  The Minister dealt in his speech with the problem of take-up, and certainly it is the wish of all of us that the rate of take-up should be high. Perhaps I might make the point that the Bill puts a further burden on local authorities in connection with their administration of it. A burden has already been placed on them by the Housing Finance Act 1972, and I hope that the Minister and the Government will find it possible to see that local authorities get special grants in order to ensure that the schemes are administered quickly and efficiently. It is all very well to say that local authorities are to receive 100 per cent. grants for the rebates that are allowed, but the fact is that the salaries and wages of staff are a burden on local ratepayers. I hope that the Minister will find it possible, by means of a special type of plan, to ensure that any extra staff who might have to be employed as a consequence of the Bill will not result in an additional burden being placed on the local authorities.
  Mr. Crosland: The subsidy covering the rent allowance will be a 100 per cent.

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  Government subsidy for only a limited period. After that, the local authority will have to cover it.
  Mr. Smith: I realise that. The right hon. Gentleman is absolutely correct in making the point. Those who have been actively concerned with local government, as I have for the past 20 years before I was a Member of this House, have seen a growing tendency on the part of all Governments to move the burden of national taxation to local taxation and to leave the local councillor to carry the can at the local elections. I very much hope that this point will be borne in mind.
  What the Liberal Members of the House, including myself, are saying, is that the Bill is inadequate but is none the less an improvement on the present position. It might almost be described as a "pop and squash" Bill in which the fizzy bit is on top, the effervescence is very good and the drink is drinkable, but it would be much better if it were strengthened. That is how we see the Bill. I shall not delay the House any longer. I have said what I need to say and I hope that the Minister will find it possible, particularly concerning security of tenure, to strengthen the Bill in Committee.
  6.25 p.m.
  Mr. Marcus Worsley: The hon. Member for Rochdale (Mr. Cyril Smith), when he began, reminded us that furnished tenancies are not peculiar to London, but I think he will have heard the statistic given by my hon. Friend in opening this debate which showed that no less than 40 per cent. of furnished tenancies are in the Greater London area and that the overwhelming concentration of them is in the three boroughs of Central London, many of the hon. Members from which have spoken during this debate. So the greatest concentration of this problem is without doubt in London.
  I think the hon. Gentleman's position was certainly more logical than that of the official Opposition. He said he would have liked to see more in the Bill, which is fair enough, but he did not put himself in the very curious situation of the previous speaker opposite, the hon. Member for Kensington, North (Mr. Douglas-Mann), who shares with me the honour of representing part of the Royal Borough, who, although he started by
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  saying that he much welcomed the Bill, has in fact put his name to the amendment, which starts by saying that the House declines to give a Second Reading to the Bill on certain grounds. This is an extraordinarily illogical position to have taken up. I do not know whether he accepts that the amendment which he and his right hon. and hon. Friends have put down will be defeated. Perhaps he is banking on that. Perhaps he is relying on the efficiency of the Government Whips, as he generally can. Were this amendment put down by himself and others to be accepted, this Bill would not go forward; yet he much welcomes it. So I think that he and his hon. Friends have got themselves into a considerable muddle—a muddle which the Liberal Party has avoided.
  The fact is, of course, that this is a major step forward. The fact that it does not do everything that all of us would like—and I shall say a little about some of the things I would like—does not mean that it is not a really major step forward. The Opposition had the chance for six years of tackling this problem and they did not give, in either the unfurnished or the furnished sector, the kind of rent allowance which is now in operation in the unfurnished sector and soon will be in the furnished sector. I speak with a great deal of feeling about this because in my own constituency and in neighbouring ones it is going to make a a great deal of difference.
  It is an important characteristic of my own constituency that there are a great number of people—and the hon. Gentleman mentioned such people in his speech—who are not very highly paid, who are working perhaps in hospitals or similar institutions in the centre of the city; admirable people, essential people, people who are above the level at which supplementary benefit, and so on, comes in to help them; but nevertheless people who find that housing costs in central London are hitting them very hard indeed. It is these people who are being helped by the Housing Finance Act which was so resolutely opposed by the Opposition, and who will be helped by this Bill which the Opposition intend to divide against.
  What is so important about this form of support is that to keep such people in central London is to keep the community

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  in central London alive. If these people leave, they will be replaced by people from abroad or from other parts of England, people who do not feel involved in the community. Many of us are very concerned about the erosion of community life in central London.
  I, therefore, congratulate the Government on tackling the problem by refusing to be alarmed at the real difficulties of extending help to the furnished sector. I commend the Government for their good efforts in Cmnd. 5183. If Governments were always to do some of our homework for us by showing the effect of amendments it would help us.
  I turn to the important question that the Opposition raise in their amendment. It is illogical not to wish to pass the Bill because it does not deal with this question. However, it is something that must be tackled. The root of the problem is that there are two systems of control—one for furnished accommodation and one for unfurnished accommodation—and the line between them is not based on any very logical distinction. It has been based for 50 years on the arbitrary fact of the existence of various pieces of wood, leather and metal in a unit of accommodation. Radical consideration must be given to the question of what kind of property should be protected and what should not.
  The Opposition's simplistic approach does not contribute much. It would not solve the problem simply to bring the furnished sector into the present system of control for the unfurnished sector. Many furnished units of accommodation would go off the market if there were even a serious threat of the type of control that exists in the unfurnished sector. I have in mind rooms, or often the whole floor of a house. A young couple acquires a house on marriage. At that stage the house is too large for them, so they let a whole floor. Then in the natural course of events their family grows, and they need that floor. So they occupy the whole house. If such people were told that if they let the accommodation the tenant would have all the panoply of the protection of the Rent Act they would not let it. That would cause hardship to the young couple, who need the income, and it would cause even greater
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  hardship to the speculative tenant who cannot move in.
  Mr. Douglas-Mann: Is the hon. Gentleman aware that all the evidence submitted to the Francis Committee urging security of tenure for furnished tenants, particularly the Labour Party's evidence, the evidence of the Society of Labour Lawyers, and all the arguments that have been presented from this side, assume that the tenant of an owner-occupier where the tenant occupies less than half the house will be excluded from protection and that holiday lettings should be excluded? The recommendation made from this side is of the kind, though not necessarily in the precise form, put forward by Miss Lyndal Evans in the minority report of the Francis Committee; namely, that security of tenure would not be granted to a tenant where he was occupying less than half of a house occupied by his landlord.
  Mr. Worsley: The hon. Gentleman has come some way towards the case I am making, but I will follow my argument through. I am arguing that there should be a new line of distinction, and the hon. Gentleman may agree with me when I have finished. There are many examples of furnished tenancies where this type of control would be thoroughly undesirable.
  At the other end of the line—this is happening a great deal in my constituency—perfectly ordinary flats, by which I mean flats with all the modern conveniences and with a front door of their own, when they become vacant are being turned into furnished lettings instead of unfurnished lettings, simply to get round the Act. Such cases present a totally different problem, for the effect of this action is twofold. First, security is removed. Secondly, there is a tendency then to get people in such accommodation who contribute little or nothing to the community. They often make life difficult or impossible for the existing tenants of the unfurnished accommodation in the block. They tend to be students or groups of young people who by nature are noisy. These people are sometimes put in with harassment in mind. Sometimes the nature of the typical, furnished tenant is that he makes life very disagreeable for the tenants who are already there.

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  In such circumstances there is no case for saying that the existence of pieces of furniture in the flat should make any difference to the nature of the control.
  We should think a little more radically than simply to say that furnished lettings should be brought under the same rules as unfurnished lettings. We should be looking for a new definition, and a new distinction between types of property where control is desirable and those where there should be a less extensive control for fear of putting the property off the market. It is necessary to look not at the furnishing of the flat or house but at the definition of the type of accommodation.
  I shall with a clear mind vote against this ridiculous "reasoned amendment", but I emphasise that I do not believe that the situation can remain where it is. The question of control must be viewed radically and afresh. A system which has lasted for so many years is shown to be less and less satisfactory. Therefore, though I warmly applaud the Government for the Bill, which is a great step forward, I hope that it will be only a precursor of a much more wide-ranging Bill dealing with the question of security of tenure and rent control.
  6.50 p.m.
  Mr. Clinton Davis: The hon. Member for Chelsea (Mr. Worsley) hopes that some of the deficiencies relating to rent control of furnished lettings will be dealt with by the Government, but there was no sign of that in the speech by the Minister for Housing and Construction. The Minister gave no indication that the Government have any further legislation in the pipeline to deal with the problem. Therefore, it becomes abundantly plain that the Government, because they are not going to introduce further legislation, are going to waste this opportunity to introduce very urgently needed reforms.
  The hon. Member for Chelsea said that he did not think that offering security of tenure to furnished lettings on the same basis as unfurnished lettings will solve the problem. I do not think it would solve the problem, because the problem is so immense in London that it will need startling assistance from the Government, something far more radical
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  than anything contemplated in this rather puny Bill. The hon. Member, like so many of his hon. Friends, asserts that there would be a drying-up of accommodation if the concept of security were extended to furnished accommodation. It is a mere assertion. It is based on no evidence. The example produced by the hon. Gentleman was not an example in fact but an assumption he made from certain facts that he postulated.
  Indeed, as my right hon. Friend the Member for Grimsby (Mr. Crosland) has pointed out, the evidence before the Francis Committee indicated a contrary view to that which is being taken by the hon. Member for Chelsea. The hon. Gentleman says that he will go into the Division Lobby tonight with a clear mind. A clear mind was not altogether indicated by his speech because, coupled with the congratulations he offered the Government, he perceived, presumably from knowledge gleaned at his surgery and from going round his constituency, that all is not well and that it is not going to be made well by the provisions of the Bill.
  Of course we on this side regard the Bill as an advance. The Government are to be applauded in a limited way for producing rebates to the furnished sector. They had intimated not long ago that it was well nigh impossible to do it, but now they have produced this short Bill indicating that it is possible after all. But the Bill is not really even beginning to grasp the nettle of the problem which faces us, particularly in the stress areas of Inner London. It indicates a misunderstanding of the nature of the problems besetting so many people—people who come along to local authorities when all is lost and ask "Can you help us?"; people who have not taken advantage of the remedies available in law simply because they do not know about them; people who have allowed their notices to quit to expire, who have perhaps hidden their heads in the sand in the hope that the problem will go away. Some of them do not know where to get advice or how to get it. In this section of the community we are dealing in very large measure with people who are most deprived, and maybe for that reason they are sometimes careless of the remedies available in law to give them some modicum of protection.

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  We have had a terrifying show of complacency by the Government today. The Minister referred to the London Action Group, which is supposed to be making a survey to ascertain whether land is available in the outer London boroughs for development by the inner London boroughs. It is supposed to be finding land. So far it has not been able to produce a single acre. I am not denigrating its efforts, but the Minister is rather casual in dealing with the problem of homelessness, which is at the root of what we are discussing, when he can allow the London Borough of Barnet to prevent the London Borough of Brent from developing a site for local authority housing.
  Yet Brent had tendered a higher price than the private developers. Barnet, in its miserable complacency and selfishness, decided, however, that it would decline Brent's offer because it did not want to have local authority tenants. Snobbish values insisted that it should have private development there, and the Minister does nothing about it. He sits back complacently talking to a colleague and is not prepared to take any action to deal with this grotesque misuse of local authority powers. I hope that the Under-Secretary of State will deal with this matter in his reply, because such a situation happens time and again. It goes to the very root of the problem because so much homelessness stems from furnished tenants who have been deprived of their homes. A similar situation has occurred in Bromley.
  The usual excuse offered in such circumstances is that the borough concerned is taking a number of transfers from the Greater London Council. One knows—my hon. Friends from inner London would certainly agree—that not only do these local authorities in outer London not take up all the transfers but that a minuscule number of people are moved. It is simply camouflage to cover up the appalling misuse of their powers by outer London boroughs.
  In Hackney nearly 40 per cent. of the rented accommodation is furnished—at least that seems to be the latest estimate. What flows from this is a great deal of uncertainty on the part of these furnished tenants about their legal position—and uncertainty leads to acute
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  anxiety, depression and distress and all sorts of social and welfare problems that we meet in local authorities and in our surgeries. Thus, 37 per cent. or more of tenants are deprived of the remedies which are available to the more advantageously-placed unfurnished tenants.
  What the Minister has singularly failed to understand is that in the vast majority of these cases the anxiety is related not so much to inability to pay the rent as to inability to ensure that for some time in the foreseeable future they will with certainty have a roof over their heads. There is in my borough a rising incidence of homelessness. In the quarter ending December 1972 there were 164 applications for admission to local authority accommodation, and 30 of these related to tenants whose landlords had obtained legal possession of their furnished accommodation. There were more whose landlords had taken advantage of the situation and had obtained illegal possession.
  My surgery is run in conjunction with my colleagues on the local council, and, probably like those run by other hon. Members, it is a living testimony of the misery and hopelessness of these people. One observes the helplessness in which they find themselves when their notice to quit has expired. One can only advise them that it does not look as though they have a chance but that perhaps they could argue that theirs is not a true furnished tenancy, because that is their last hope. The local authority tells them that they must persist and defend the proceedings even though they do not have a defence because they must do the best they can to help themselves. In that way these people land themselves with additional costs. The local authority must then provide bed-and-breakfast accommodation for these people because in most inner London boroughs there is an insufficiency of accommodation for the homeless these days.
  This is a terrible problem, and my right hon. Friend the Member for Grimsby was right when he said that it is likely to be exacerbated when landlords decide to serve notices to quit as soon as the local authority rent officer comes to make his inquiries. But, even if the Minister does not accept our proposition that security of tenure should be

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  extended to furnished tenancies, surely it is time for him to apply his mind to defining precisely what is a furnished tenancy. We were told on many occasions that his predecessor was doing so. This problem is dealt with in the Francis Committee's Report, where there is a firm recommendation that the present law should be regarded as grossly inadequate and misleading.
  My hon. Friend the Member for Kensington, North (Mr. Douglas-Mann) has had some success in the local county court with cases he has undertaken in persuading the court to adopt a certain basis of valuation of tenancy; but that is applied very much by rule of thumb, with great respect to him. There are cases which indicate how much it is rule of thumb. There are cases which indicate that the proper proportion of the value which should be attached to furniture should be 8⅓ per cent., although some say 6 per cent., and, therefore, we just do not know what the true figure is. It is wrong that the law should be as uncertain as it is, so incapable of being defined, because uncertain law is bad law.
  The uncertainty of the present position is such that I do not believe that it is possible for lawyers to advise adequately about the matter. That means that tenants are left in the air as to their true position. It follows, therefore, that the Government should at least consider the proposition advanced by Francis, that there should be a new definition. They have not done so, not that I think that would solve the problem, but it would at least have shown that the Government were thinking about it. It is because the Government have not said what they think and it is not possible to create a clear definition that we believe the law applied to furnished and unfurnished tenancies should be equated.
  The illogicalities of the present situation are there for everyone to see. So much depends upon the situation which existed at the beginning of the tenancy. The tenant who replaces the landlord's worn-out furniture with his own, so that there is nothing left of that provided by the landlord, is still in an uncertain position. He may still be regarded as a furnished tenant and have none of the security of the unfurnished tenant.
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  The real reason for the decline in unfurnished accommodation and the increase in furnished accommodation has nothing to do with the arguments adduced by the hon. Members for Chelsea, Hemel Hempstead (Mr. Allason) and others. It is that rents in this sector are higher and security is less. Landlords are not in the business to do other than maximise their profits. We cannot complain because that is the nature of the system in which we live, but we do not condone it and desire to change it. Although what we are proposing undoubtedly would be a most useful advance, far in excess of anything the Government are proposing, the only way to solve the problems of the stress areas is to extend the powers of local authorities to take rented accommodation under their control. Yet that is the very solution which the Government reject. We have not heard about it from the Minister today, so perhaps he does not reject it. Perhaps he is battling against his ministerial colleagues. We do not know because he said nothing on the subject. Unless we begin to accept that private landlordism in areas like Hackney, Islington, and North Kensington has singularly failed and, therefore, must be replaced, we shall be unable to find any sort of solution to our difficulties.
  It will be a difficult task. The depth of the problem is such that it needs a far more radical proposal and solution than anything that this puny Bill has to offer. Therefore, although I believe that the Government have made a little progress, I hope that they will think again and not neglect the opportunities that lie ahead radically to amend the Bill in order to make it much more worth while for the unfortunate people in the furnished sector.
  7.8 p.m.
  Mr. W. R. Rees-Davies: I had not intended to speak in the debate but I now wish to make a contribution on one or two aspects of the Bill. First, I welcome it because it makes at least some provision for those who are in real need and who are unable to meet their rent. It is, however, a limited Bill and it should remain so. The hon. Member for Hackney, Central (Mr. Clinton Davis) addressed himself to the problems which I am sure exist in Hackney and North Kensington. I

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  should like to address myself to the problem of furnished accommodation in other parts of the country.
  The largest amount of furnished accommodation in the Metropolis is provided for the foreigner. It is provided for almost every type of foreigner who comes here to carry out his business. Those who come for only a few days stay in the expensive hotels, but those who come to do real business quickly move out of the hotels and seek furnished flats and rooms.
  The second largest category of those who occupy furnished accommodation in London are our own people from the Midlands, the North and other parts of the country. They come on holiday in the summer when a large number of people have moved out of furnished flats, which they take, or they come from Birmingham, Manchester, Liverpool and elsewhere and they need a small pied-à-terre or furnished room regularly in London to enable them to meet their needs. I can illustrate this by saying that in Pimlico, in the very area in which we now are, there is one street with no less than 50 houses devoted entirely to that class of business, and several hon. Members live in that area. I am not one of them. There are also hon. Members on both sides of the House who own one or more of those houses. They are developed as furnished accommodation to meet a specific market. The letting seldom exceeds six months. It is often for three or four months and occasionally nine months.
  The turnover is tremendous. For example, there are all those who serve in the Australian High Commission and who come and go, all those who serve in the various offices of the Commonwealth, all those who serve in the embassies and all the Americans who come here. Apart from that there is a wide range of businessmen.
  I often speak in this House on tourism. This is not quite tourism. It is true that a large number of people who want to enjoy England today make their headquarters in London and branch out into the country. They cannot afford the hotels. The hotel industry in recent years has provided 40,000 to 50,000 extra bedrooms for those who can afford to pay
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  for them but it has not managed to provide cheap accommodation in London.
  There is nowhere in London that I know of where a person can get bed and breakfast for £2. Consequently people turn to the furnished accommodation. The average price structure varies from about £12 to £20 a week for furnished accommodation in the Pimlico area, providing a bathroom, kitchen and at least two rooms. It is rightly called executive accommodation at the top end and it goes down to family accommodation for people coming from all over the country.
  We have to be careful, if we seek to introduce statutory control, that we do not drive that accommodation off the market. There is not enough of it. Events are closing in. Unfortunately more and more of certain areas has been taken over for offices. Other areas have been taken over by wealthy people and by large companies able to buy large flats or even take over a whole house. As a result of our entry into the Common Market our friends from those other countries will be wanting a place in London, if they can afford it.
  If we introduce any kind of control over what I call the decent class of furnished accommodation, it will be fatal. The question is whether the Government can in due course work out a scheme which will deal with the periphery of this matter and stop the undesirable behaviour of a small section of landlords in areas such as Paddington and Hackney whose main aim is to get the maximum amount of money—let us be blunt—mainly at the expense of coloured people. Perhaps there can be some joint thoughts on this.
  I am sure that the Government would like to take action to prevent anything which smells of Rachmanism, extortion or failure to provide proper facilities. My judgment is that this will not be done by way of statutory control. It must be done along the lines of finding a way to ensure that the services provided are proper and adequate. There is very strict control through public housing to ensure proper sanitary conditions. It is by an extension of such lines that we may be able to get more satisfactory furnished accommodation for those who cannot afford to move into unfurnished accommodation and who are unable to obtain houses.

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  Who are those people? First they are the coloured community, particularly in areas such as Paddington and Brixton. The problem there is overcrowding. In one instance of which I heard recently in Thanet, there are no fewer than 30 people in one house. This kind of thing is frequently to be found in certain areas of London. It is still possible to use old provisions more effectively in preventing excessive rent. This worked before and it can work again. The difficulty is supervision. The problem lies in the overworked local authorities in these large areas being called on to perform yet another function in trying to watch over large areas of very cheap furnished accommodation. It is an extremely difficult additional burden.
  I do not think that the right way is to introduce statutory control so that a person cannot be got rid of. I had to speak about this some years ago at the time of the original Act in connection with holiday lettings. In the end it worked out fairly well, but we still have occasional examples of people taking advantage of the situation and moving into a town such as Margate and deliberately remaining after their lease has ended in the knowledge that they will have to pay a higher rent once the high season begins in the summer.
  Most important of all we must recognise that London, Liverpool, Birmingham, Manchester and Cardiff are the great cities of the European future. There will be a need for more accommodation. The hotels which are most crowded at the moment are, curiously enough, those recently built with single bedrooms. There is an immense demand. Equally there will be a demand in those areas for furnished accommodation, small flats, company flats and flats for people who may be working there during the week. It is easy nowadays to commute from London to Birmingham. I did it during November. I had to go up every morning and be back here in the House in the afternoon.
  This means that we have to preserve mobility in the furnished accommodation market. I do not want to decry the human approach taken by the hon. Member for Hackney, Central on a different problem, but I do not think that the way out is through statutory controls so that people can never be moved. We
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  have to work at trying to make their conditions better and, by assisting with local authority grants, ensuring that standards are improved. By all means let us ensure that the landlord makes adequate and proper provision for all reasonable amenities.
  7.18 p.m.
  Mr. Arthur Latham: I am particularly pleased to follow the hon. Member for Isle of Thanet (Mr. Rees-Davies) and to link what he has said with the contribution of his hon. Friend the Member for Chelsea (Mr. Worsley). It has to be recognised that there can be two problems, two types of furnished accommodation mixed up in this argument. We can come to contrary and conflicting conclusions according to whether we look at it from the point of view of a prosperous area in which furnished accommodation is naturally provided for those who seek temporary accommodation or whether we are linked with an area where ordinary working families are being exploited by landlords who are simply letting accommodation, which would otherwise be unfurnished, as furnished to circumvent the legislation protecting tenants living in unfurnished accommodation.
  The hon. Member for Chelsea drew attention to this and suggested that the Government should be re-examining the problem and trying to find a way of dealing with the different situations. He referred to what in some circumstances he rightly regards as the arbitrary dividing line between what is furnished and what is not. There is this distinction between the type of accommodation to which I have referred and that which is intended as a service, to be let as furnished accommodation by a landlord and where the occupant is the tenant of furnished accommodation by choice, because he specifically wants furnished accommodation rather than to be a tenant who is in furnished accommodation simply because this is his last desperate attempt to find some kind of home, all the other agencies having failed to provide him with unfurnished accommodation.
  What surprises and disappoints me is that the hon. Member for Southampton, Test (Mr. S. James A. Hill), who was so unwilling to allow an intervention and who has long since left the Chamber, was

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  rather forcibly congratulating the Government upon introducing the Bill. He reminded the House that the Bill emanated from an undertaking given in Committee about a year ago. We were told at that time by the then Minister that the Government were concerned that there were great complexities. We had in mind some of those which have been instanced by the hon. Member for Isle of Thanet and the hon. Member for Chelsea.
  I would have hoped and expected that in the intervening 12 months not only the working party, about which we then heard for the first time, but the Government in their subsequent considerations would have set about tackling the complexities. The point I wanted to put to the hon. Member for Test, which I also put to the Government and to the House, is that although the situation is wrapped in complicated procedures which require a separate textual memorandum to assist hon. Members in understanding how this legislation will work, what is proposed is very simple indeed.
  It does not represent anything which could have developed out of 12 months' consideration and deliberation and could not have been incorporated in the Housing Finance Bill when it was first considered. I would have hoped that the Government might at least have said that they recognised these complexities but had failed to find answers to the problems and were therefore bringing forward this inadequate and puny piece of legislation aimed at tackling the problem of the exploitation of ordinary working families.
  I have a lack of enthusiasm for rent rebate schemes and I have even less enthusiasm for rent allowances, whether in the unfurnished or furnished sectors of housing. In the final analysis we are not, as some claim, subsidising the tenant; we are subsidising the landlord. I am unhappy about any extension of means-tested benefits and about a situation in which a substantial proportion of tenants, be it one-third or one-half, become eligible for such benefits.
  Eligibility must not be confused with likely take-up. Whether we are dealing with the local authority sector or the private sector, furnished or unfurnished,
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  in a situation in which large proportions becomes eligible for rebate or allowances there must be either something wrong with the rent levels being charged or something wrong with the distribution of wealth and incomes in our society. I conclude that both of these charges are true. The fact that I am unenthusiastic over a situation in which a majority of people become eligible to apply for means-tested benefits, when I believe that it is the landlord who is ultimately being subsidised, does not lead me in the present circumstances, with the present Government, to vote against this puny measure.
  It is wrong that so many old-age pensioners should have to depend on supplementary benefit. It would be better if the basic pension were adequate. To take that view, however, is not to oppose the provision of supplementary benefit in the meantime. Similarly, whilst I would prefer to see this problem resolved by bringing rents down, short of action in that direction I do not oppose the little assistance that might be offered in the Bill to tenants in furnished accommodation.
  My right hon. Friend the Member for Grimsby (Mr. Crosland) thought that giving allowances to furnished tenants might mean that a tenant who claimed an allowance would find that his rent was increased so that the landlord would benefit from the allowance. In that way money paid by the community into the tenant's pocket would go straight into the landlord's pocket.
  The Minister who is in charge of the Bill is usually realistic and lucid, although I do not always agree with his point of view. But he is not being realistic about the practicability of this scheme unless security of tenure is introduced. Whether or not one is in favour of rent allowances for furnished tenants, one must be realistic and see how they are likely to work in practice. At present people continue to pay unfair rents because they fear eviction and because there is a lack of protection. The hon. Member for Northants, South (Mr. Arthur Jones) claimed that a tenant of a furnished dwelling could apply for an allowance without the landlord knowing anything about it and would not be deterred from claiming by the fear of eviction. If the hon. Gentleman refers to the Bill he

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  will see that according to Schedule 1 the calculation for rebate purposes cannot be made without knowledge of three figures. One is the actual rent being paid, which the tenant may be able to substantiate without reference to the landlord by the production of a rent book. The second is an assessment of what the fair rent would be without furniture plus the 25 per cent. element referred to by the Minister. The third is the registered rent. The Bill provides that the amount of rent eligible to be met by the allowance shall be whichever is the smallest of those three figures. It is impossible to know which is the smallest without knowing all three figures.
  A large number of properties in my constituency are no more than boxes with bits of sticks called furniture, a large proportion of the rents of which are unregistered. To obtain a rent allowance tenants of those properties will have to take steps to have the rent registered so that the comparison can be made. The choice will remain with them of taking such action—and the landlord knowing of that action—or of opting out of the rent allowance scheme altogether. My fear is that those tenants in my constituency will not want to get involved with officialdom and authority and will not want to go to the rent officer in case the landlord should become aware that they have taken such steps and, as many landlords have done in Paddington, finds reasons for getting them out of the accommodation and offering it to others who clamour for it, unsatisfactory and unhygienic as it is and exorbitant as is the rent.
  If the Under-Secretary of State is able to say anything to allay that fear which my tenants justifiably have, I shall be delighted to hear it. I should like to know how tenants in furnished accommodation where the rent has not been registered may seek a rent allowance without the landlord becoming involved, and so remove the fear which inhibits them from seeking benefit from the scheme.
  As my hon. Friend the Member for Hackney, Central (Mr. Clinton Davis) said, many tenants are ignorant of their rights. Many of them think of the law as belonging to a different class of person, and it is expensive. For these reasons, coupled with the fear of losing the roof
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  over their heads, they are prevented from exercising their rights.
  I emphasise that the majority of those about whom I am concerned in my constituency are not in furnished accommodation through their own choice. They would much prefer unfurnished accommodation which they could furnish to their own liking. The only reason why the property they rent is furnished is that the owner of the property wants to get round the Rent Acts and make as much money as possible as quickly as he can. In the last two or three years there has been much evidence in Paddington that as soon as a property or part of a house which had previously been let unfurnished has become vacant, the landlord has put in a few cheap articles of furniture, divided up the property and let it as furnished accommodation at exorbitant rents. The Bill is disappointing as the Government have produced no solution to that problem. Such help as it gives is marginal and minimal and does not tackle the problem which needs to be solved.
  My right hon. Friend the Member for Grimsby rightly said that the sale of property had become so profitable that it accounted for the reduction in privately let accommodation at the rate calculated by the Minister of 50,000 dwellings a year. For the reasons I have outlined there has been a reduction in the availability of private unfurnished accommodation and a corresponding increase of furnished accommodation. When it is suggested that control would lead to this property disappearing from the market, I find it hard to envisage the use to which the property could be put. After becoming vacant, good properties which have previously been let unfurnished have been sold. It is the poor properties which have been used to exploit the black and white residents in Paddington. I do not go along with the claim that the majority of the exploited tenants of furnished accommodation in Paddington are coloured people. A high proportion are, but the community as a whole is suffering exploitation.
  It is not unusual to have exceptional legislation to deal with an exceptional problem in a particular part of the country. Recognition has been given to stress areas in the Housing Finance Act by

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  many special provisions. One contribution to the problem in the stress areas would be to insist that all tenancies whether furnished or unfurnished, must be registered, and that all rents should be determined through the rent machinery. Only in that way would the scheme before us give any great measure of assistance to a large number of tenants. So long as the initiative rests with the tenant to invite authority to take action, the tenant, either from ignorance or from fear, will be inhibited from initiating the process which can result in financial assistance being given to him.
  The Government have spent a year or more studying the problem. In addition to the little that is in the Bill they should have brought forward proposals for dealing more effectively with bad landlords. There are good as well as bad landlords, but Paddington seems to have an unfair share of bad landlords, the type who will take advantage of a three-storey house with attic and basement to let five floors, often dividing each floor into two and letting one room or two rooms for between £6 and £8 a week for each individual tenant, representing an income of between £1,500 and £3,000 a year for one property with very poor shared facilities.
  If one asked those tenants what action they would like the Government to take, their first priority would be for the Government to get them out of these hovels.
  Their second priority would be for the landlord to put the house in order. Their third priority would be for the landlord to stop charging exorbitant rents. None of the tenants I have in mind would think that the solution is for the Government to give them a sub to help pay the exorbitant rent. They would not regard that as the way to meet their problem.
  A future Government will insist on compulsory registration of all tenancies. Anyone willing to function as a landlord of furnished or unfurnished property should require to be licensed as a fit and proper person to own and manage someone else's home. It is necessary to have a licence to drive a car, to run a betting shop, to sell pets and to sell liquor. All kinds of functions which fall short in importance of managing and providing
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  a roof over someone else's head require a licence. Licences could be withdrawn if a person engaged in malpractices, and that might be a way of dealing with bad landlords.
  I should like to deal with one other aspect of the Bill. A good deal of Press publicity has been given to the fact that some months ago the First National Finance Corporation netted a profit of £24 million simply by acquiring from the existing landlords, over the tenants heads, 110 blocks of flats and subsequently within a short time selling off those properties to a new set of private landlords. The number of tenancies involved divided into the total profit made by the corporation represents a sum of £2,333 per tenancy. This trading in people's homes represents a clear profit of over £2,000 per tenancy, since this is the difference between the original purchase price and the price at which the dwellings were subsequently sold. This is not a philanthropic venture, but represents a clear expectation of the future trend of rents in both the local authority and the private sector.
  Against the background of profit from trading in people's homes, we should examine the impact of this puny measure on rent levels charged to people who otherwise would be homeless or living in inadequate accommodation. Some of the properties in the 110 blocks to which I have referred are furnished, and there are other deals and transactions taking place at present in the expectation that still higher rents will be possible. The payment of rent allowances, without any conditions being applied to the maintenance of the property, will result in rent levels rising still further and these profitable property transactions in people's homes will continue.
  The tenants about whom I am concerned do not live in their present accommodation from choice. It may be argued that the Labour Government missed an opportunity to do something about furnished accommodation during their term of office. I make no apology for that but, for the reasons I outlined at the beginning of my speech, it must be said that the number of furnished units of accommodation—and more important, the number of problem furnished units—has been growing over the last two or three years. Furthermore, there has been a noticeable

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  increase in the excesses practised by the worst landlords in recent times.
  I conclude by asking the Under-Secretary of State some direct questions. The Minister quoted figures which indicated that one-quarter of furnished accommodation was at present occupied by families. What was the methodology of the survey which produced that figure? How up to date is the Minister's figure of 600,000 dwellings and what is the proportion in London? What definition of the term "furnished accommodation" was adopted? It is difficult to adopt a clear definition in respect of many properties—and this certainly applies to properties in my constituency—and whether those properties can truly be regarded as furnished or unfurnished. If we are expected to base conclusions on the Minister's statistics, we are entitled to know a little more about the authenticity and accuracy of the figures.
  The Bill only scratches at the problem and will have the effect of concealing many of the very real problems that exist. I do not question the motives of the Minister or of the Under-Secretary from the point of view of their own political philosophy, but I regard this exercise as a conscience-saver which may prevent a more comprehensive and thorough tackling of the problem. It may provide an alibi for something else. The question we have to consider is whether rent allowances will be provided for furnished tenancies and, if not, why not. I have given a number of reasons which apply to the majority of furnished tenancies in central London.
  I regret that the Government have spent a whole year in looking at ways in which to tackle the problem and have come up with only a limited solution. They could have tackled the housing problem with much more comprehensive proposals which go much further than those contained in the Bill to help those in furnished accommodation who are exploited by had landlords.
  7.48 p.m.
  Mr. David Stoddart: I have listened to the debate with great interest and I must confess that I had not intended to take part. However, having heard interesting speeches from both sides of the House, I feel that I should take
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  this opportunity to say a few words about the Bill and about the housing problem generally, particularly relating to furnished tenancies.
  I had hoped that in the period which has elapsed since the long dreary hours spent discussing the Housing Finance Bill—
  Mr. Allason: Who made them dreary?
  Mr. Stoddart: The hon. Gentleman asks who made those hours dreary. It was the Members of his own party who made the proceedings so dreary because they would not accept the Opposition's reasonable amendments. They would have saved themselves a great deal of time if they had listened to reason and heeded the warnings of the Opposition about increasing the costs of housing and if they had not brought forward the Bill at all. In my view the long dreary hours that we spent in Committee were the fault of the Government and their total inability to understand the true housing position.
  Although I appreciate that a little will be done to help the tenants of furnished accommodation, I should have much preferred to see the Government taking the opportunity in recent months to reexamine their housing policy. I should have preferred the Minister, instead of talking about this Bill, to talk about ways and means of cheapening houses. I should have liked a reply from the hon. Gentleman to a letter I wrote him during the recess about a speculative housing firm in my constituency which within a year doubled the cost of houses built on land which bad been sold to it very cheaply by the local authority. I should have preferred that to this puny little Bill.
  If we are to solve the problems of the tenants of furnished accommodation as well as those of other tenants and of owner-occupiers, we need more than a little Bill of this kind. We need a general shake-up of our housing situation. We do not want merely to put out £8 million to assist the tenants of furnished accommodation. We need to re-examine the whole basis of our housing policy because it is a policy which is based solely on profit, not only in the private furnished and unfurnished sector but, as a result of the Housing Finance Act, in the local authority sector as well.

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  If we are to provide better conditions for those living in furnished accommodation it is necessary to take the profit out of land and housing. The Minister ought to be giving a great deal of attention to that aspect bearing in mind the measures being brought forward by his right hon. Friends the Prime Minister and the Chancellor of the Exchequer to deal with the inflation which they have caused and which is largely taking place in housing.
  I represent a provincial constituency where 62 per cent. of the population own their houses and 33 per cent. rent houses from the local authority. That leaves 5 per cent. who are in furnished or unfurnished private accommodation. The problem in Swindon is not all that serious. I appreciate, however, that the problem in London for the tenant of furnished accommodation is extremely grave. But I hope that I am not as parochial as the hon. Member for Rochdale (Mr. Cyril Smith), who appeared to resent the fact that many London Members intervened in the debate to highlight the special problem facing the Metropolis. I know that it is a very serious one.
  I should not want to live in London, but recently I took the trouble to visit some furnished accommodation in Kensington. What I saw made me realise the almost insoluble problem that London has in its housing difficulties. Swindon is an expanding town, and we are doing our utmost to assist. We are building houses which I hope many Londoners will occupy if we can find jobs for them. We are trying to help solve London's problem by expanding our town and making good accommodation available to Londoners, especially to those living in deplorable circumstances in furnished accommodation.
  I was surprised to hear of some of the rents that these people were paying. Very high rents are demanded for single rooms with facilities which ought not to exist in 1973. This is why I made a plea earlier in my remarks that we should be dealing with the housing problem on a very much wider and more radical basis. But the problem exists in the main in the Metropolis and I sympathise greatly with those who have to deal with it.
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  The question is whether the Bill will assist those whom it is meant to assist. My hon. Friend the Member for Birmingham, Aston (Mr. Julius Silverman) related the experience that he and his local authority had been having in Birmingham. He outlined some of the difficulties that the city council had encountered in trying, through its powers under a Private Act, to put into operation housing rebates for both furnished and unfurnished tenancies.
  There is no doubt that the administrative problems are very real and that the strain on local authorities and their officers will be very great. The Bill says for example that the amount of rebate will be based on 125 per cent. of a fair rent. But let us consider the situation of a local authority examining furnished accommodation and inevitably comparing it with its own accommodation and the rents paid for that accommodation. The Francis Report showed that the average price for a furnished room was £3·51½. Many of the local authorities in administering this legislation will find that the fair rent for a house built to Parker Morris standards is perhaps £5 or £6. What kind of fair rent will they apportion to a single furnished room or to other furnished accommodation which certainly will not have been built to Parker Morris standards?
  My hon. Friend the Member for Aston had a very real point when he said that the amount of rebate that the tenants of furnished premises would be able to obtain under this scheme was very small. As a result many will not go to the trouble of applying to their local authorities for any rebate to which they may be entitled. People resent applying for means-tested benefits. Anyone who read the article in the Sunday Times last week about a poor family will understand that working people are proud. They believe that means-tested benefits put them in an inferior position. They do not want to do it; they have their pride. There is a real problem in trying to convince people of their right, perhaps their duty to their families, to apply for benefits which have been voted by this House.
  When I talked to my local authority in Swindon about the Housing Finance Act before its operation, I was told that on the basis of its assumptions it expected

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  that between 60 and 70 per cent. of people in Swindon would qualify for a rent rebate. I said that the Minister did not agree; his figure was in the region of 35 to 40 per cent. The local authority said "As far as we are concerned, the Minister can say just what he likes. On the basis of our knowledge, between 60 and 70 per cent. of people in the Swindon borough area will qualify for a rent rebate."
  Indeed, the local authority was so confident that when the time came to make estimates, because it applied the scheme in April—I did not quite agree with that—it based its rate contribution estimate on the basis of a 60 to 70 per cent. take-up of rent rebates. As matters turned out, the Minister was more accurate in his estimate than the local authority and the take-up, although estimated at 60 to 70 per cent., has been between only 35 and 40 per cent.
  If in the sector of council housing—the council is in constant touch with the tenants week by week by rent collection and other means—the take-up is only 50 per cent., what will be the take-up by private furnished tenants, particularly bearing in mind that the rebate which will accrue to a tenant will be so small?
  The views put forward by my right hon. and hon. Friends need to be taken into account by the Minister. He must have further thoughts about security of tenure. Without security of tenure the tenant of furnished accommodation, who is insecure enough in any event and probably at the poorest end, will simply be frightened to apply for his rights. Many tenants are already frightened to go to the rent tribunals because they know that if the landlord gets to know, they may have only a few months more to occupy the property. I therefore urge the Minister to heed the minority report of the Francis Committee by Miss Evans who put forward very cogent reasons why there should be security of tenure and, indeed, showed how this problem can be dealt with administratively. The Minister must take this point into account and give it a good deal of consideration.
  The Opposition's reasoned amendment had to be put down because, without security of tenure, even the small amount which has been made available to furnished tenants will not be taken up
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  as a result of their fear of what their landlords can do if they find local authority officials floating around their properties and perhaps finding that they are charging rents which are far too high for inferior properties.
  I hope that the Minster will understand what we are getting at. The Opposition are trying to assist him in this particularly difficult matter of being fair to a section of the community which has been hard done by for some time. I hope that right hon. and hon. Gentlemen on the Government side will see the sense of the reasoned amendment and will support it.
  8.5 p.m.
  Mr. George Cunningham: A reason often advanced for not proceeding with legislation on important matters as rapidly as some hon. Members have pressed for it is that there is always a shortage of parliamentary time. In the light of the nature of the debate tonight on this subject, that argument cannot be sustained. That relates to the reasoning advanced earlier by the Minister for this Bill, with its rather meagre provisions, not taking account of some of the recommendations in the Francis Report which it was suggested might have been included. It is possible that in the 18 months to two years since the Francis Report came out the Department has not had time to work out what it wants to do as a result of it. However, I do not believe that is so.
  The only reason that could be advanced for not having fulfilled more of the proposals in the report is the shortage of parliamentary time. Surely it is clear from this performance tonight that there is no shortage of parliamentary Second Reading time. Whether we needed it or not, we have had probably twice as much time as was desired for debate on the Bill as it stood. This is becoming a not unusual occurrence. The idea that there is a shortage of parliamentary time is baloney. There is no shortage of time. If we organise it properly, we can get through twice as much legislation if it is brought forward.
  I have a small number of points to make on the provisions of the Bill. It has been said that when a tenant of furnished accommodation appeals to the rent tribunal it is frequently the first step

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  to his ultimately being put out on the street. My experience in Islington is that it is not only the first step to being put out on the street, but it is a provocation to harassment. Frequently when a tenant has gone to the tribunal and got what for him is quite a satisfactory solution—either a period of security of tenure or, more important, a reduction in rent—he finds that is when the harassment begins.
  The legislation on harassment, even with the increased fines which the Department co-operated in getting last year, is not effective. We cannot discuss this subject without realising that harassment continues. I will not say that it continues as strong as ever, because the devices used in Rachman's day do not continue. They have been sublimated into more legal, but no less effective, methods of getting people out of their homes.
  Worse, the courts, due to some judges being too little aware of the social consequences of what they are doing, frequently co-operate by taking a view on what constitutes suitable alternative accommodation which certainly does not fit my view of particular cases and results in tenants being ousted from houses when the landlord's only intention is to sell the house for an enormous profit. I have witnessed cases where that motivation was openly acknowledged in court. Nevertheless, the tenant was required to leave the property.
  The principle that we should subsidise private rents—and the principle is quite different in the case of municipal accommodation—is inherently wrong. I am not saying that the Bill is, therefore, unfortunate. I support the Bill as far as it goes. But there is an inherent difficulty about subsidising or providing an allowance towards meeting a private landlord's rent. We cannot take sufficient account of the fact that there will be deals between landlords and tenants. Landlords will say to tenants "We are going to put up the rent. But that is all right. You will not have to pay. We will come to a cosy arrangement between ourselves. We can both make a profit at the expense of the Government".
  No one can tell how common that situation will be. However, it will hap-
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  pen. There are close connections between some landlords and tenants. If we were starting from scratch and building a paradise, we would not create a situation which would allow the landlord to charge a high rent and then give the tenant an allowance from public funds to help him meet that rent.
  If we find that going rents and incomes are such that we are not prepared for social reasons to allow the tenant to find the rent from his income, we will in the long term have to look for a more radical solution. That means the phasing out or the dying out naturally of the private landlord and the substitution of various forms of publicly owned accommodation. I stress "various forms" because God forbid that the country or my part of London should be entirely in the ownership of one council or one council and the GLC, and that the only type of accommodation available should be the type which borough councils tend to build.
  We experiment too little with other forms of communal ownership. The co-operative movement does far too little in that respect. There are co-operative housing developments, and many places are owned by tenants who form a cooperative. However, we do not have the kind of thing which is to be found in Scandinavia and France, where the national co-operative movement operates with the local authority and provides some variation in the methods used by a local authority. I should like to see housing associations directed either at the population in general or at particular professions—for example, students. I should like to see larger associations than are common now which would provide another part of the market. With those variations it would be possible to provide for the entire requirement without the private landlord, with all the disadvantages which he increasingly presents. I should like to see such provision in city centres to meet part of the demand.
  The principle that the subsidies that will be paid to private tenants and others should be made in part, and an increasing part, out of rate money as against Exchequer money should be totally unacceptable. Of course, that is not a new point. In many respects we are asking local authorities to undertake redistributive

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  functions by taking on social welfare functions, which they can execute far better than a central Government agency. But the cost of that kind of operation properly belongs to the Exchequer and not to local authority rates.
  The Government are increasingly asking rates to bear the significant part of that kind of burden. I hope on the grounds of general equity, and because we all know that rates are a kind of taxation which no one would dream of introducing if we had not inherited it from the 16th century, that the engines are reversed and that we revert to meeting more of that kind of expense from general taxation.
  I now refer to the proposed devices to establish effective rents for furnished tenancies after making the reduction for the deemed cost of the procedure. I am at a loss to understand why that responsibility is placed directly upon the local authority. The Bill provides that rents are to be estimated by the authority for the purpose of estimating a fair rent. The authority is in a position to consult any rent officer.
  Therefore, the local authorities will have the responsibility for that decision after, if they wish, consultation. That consultation with the rent officer is not mandatory. It seems that we are creating a situation in which there are about three dogs all chasing each other's tail in a circle. It is already difficult, and it was difficult before the Housing Finance Act, for those who are trying to establish fair rents in the private sector to do so without reference to the public sector. Now we are trying to establish fair rents in both sectors. They are each chasing each other's tails. We are saying that the local authority must make a guess about what the rent officer would decide if he were considering a hypothetical situation. They have to try to imagine what the rent officer would decide if that situation existed. That is enough to try to drive any local authority official stark raving mad. It will mean that different local authorities will operate on a different basis.
  First, I understand that the reference to the rent officer and consultation with him is designed to detract from that and to bring some consistency into the operation. However, I cannot see why con-
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  sultation with the rent officer should not be made mandatory. Surely that is desirable. Secondly, I cannot see why the responsibility is not given to the rent officer. His office is where the expertise lies. The expertise does not lie with the local authority, which is a political body. No one would have dreamt of giving local authorities the responsibility for deciding fair rents. As we have two growing industries for the establishment of fair rents which operate on different administrative procedures, it is a bit daft to set up a third which will be made up of the officials of a local authority and supervised by the political heads of a local authority.
  I hope that that matter can be looked at closely in Committee. I can see no administrative objection if it puts more work on to the rent officers' staff. It will take more work away from the local authorities' staff, and they will have their hands full enough with all the consequences of the Housing Finance Act, without giving them that extra and different function.
  8.19 p.m.
  Mr. Frank Marsden: Like my hon. Friend the Member for Swindon (Mr. David Stoddart), who has unfortunately left the Chamber, I had not intended to speak, and the circumstances in which I have to speak are deplorable. I have had a busy day and have not listened to the debate. I have been in and out of the Chamber. The Mother of Parliaments is debating a matter which will affect, on a conservative estimate, 500,000 people; yet there are exactly eight members present.
  The Grieve Report on homelessness in London, published in 1971, said that private furnished accommodation was by far the most common type of tenure prior to homelessness. Like most hon. Members, I interview my constituents every Saturday, and I know that if that is true of London, it is certainly true of Liverpool.
  In Standing Committee E, on which I served for a short time, as early as the second sitting on 20th January 1972 we pressed the then Minister to include furnished tenants in the Housing Finance Bill. He gave his reasons for not doing so, one of which was administrative difficulty. I was not convinced then, and I

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  am not convinced now, and I have never fully understood the argument.
  The Housing Finance Act is very complicated, but why it could not have included all tenants—council, private furnished and unfurnished—with everyone treated the same I shall never know. The Bill is designed to take care of the furnished tenant. The only conclusion to which I can come is that the Government do not wish the furnished tenant to have security of tenure because of the landlord-tenant relationship in that field. They want the landlord to be able to get rid of the tenant whenever he wants.
  Party policy is normally stated from Front Benches, but I see no reason why a humble back bencher should not state what his party believes in. We in the Labour Party believe that most furnished tenants should have the same security as unfurnished tenants. It is as well to state yet again that, although the number of furnished tenants does not exceed 500,000, they are often the lowest paid, the least secure and pay the highest rents for the worst accommodation.
  I cannot support the Bill because this provision could have been made quite easily in the Housing Finance Act; there is no need for the Bill.
  8.25 p.m.
  Mr. Eric Deakins: Like some of my right hon. and hon. Friends, I have a constituency interest in the subject of furnished rented accommodation and in allowances which may be payable to tenants of it. In my constituency in North-East London about a third of the accommodation is provided by private landlords. Much of it is admittedly unfurnished—this is a diminishing quantity of accommodation in London—but there is also a fair amount of furnished accommodation.
  Like many other hon. Members who represent large urban areas, I find that most of the requests for help that I get over rents, and especially evictions, come from people in private rented furnished accommodation.
  The Bill will do something good, but our major criticism is that it does not go far enough. One might almost say that it is merely playing with the problem. Allowances should go right through
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  the private rented sector, and there is no logical reason—although there may be financial reasons—for excluding particular categories of furnished tenants who cannot prove hardship.
  Admittedly, in a schedule there is provision for the Secretary of State to designate other categories, but if he intended to make vast extensions to the Bill they would be in the Bill because there would be a great deal of political capital to be made from such a generous move. So we can expect these reserve powers to be used very sparingly, if at all.
  In considering whether allowances should be extended to all furnished tenants, one has to bear in mind the great disparities between the rents that they pay and those that others pay, particularly council tenants. In the Greater London area, the average rent, including rates, for a self-contained three-bedroomed council flat with lounge, kitchen, bathroom, lavatory and central heating is probably not more than £10 a week. For early post-war flats, with many of the same facilities, it would be considerably less—perhaps £5 or £6 a week.
  If such council tenants are to be allowed rent rebates, it is surely even more important that tenants of private furnished accommodation, who are paying much bigger rents, in many cases for much worse accommodation, should also be eligible right across the board for these allowances. That is not what the Government suggest.
  It may be said that I am exaggerating the disparity in rents. I want to give a few examples from one of today's evening newspapers, so that I am up to date with my information, of what private furnished tenants have to pay in parts of London. I discount districts such as Marble Arch and Maida Vale, where three-bedroomed flats with central heating, and so on, are going from anything from £40 a week to £60 or £70 a week. Neither side of the House would necessarily worry about the sort of people who can afford rents of that sort. Indeed, it is not the purpose of the Bill to take into account the interests of those tenants. But there is a great deal of other private furnished accommodation in the Greater London area in places where diplomats and top executives do not particularly want to live but where ordinary people

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  live and must find accommodation, especially if they live in areas such as mine, where there are long council waiting lists and there is little or no chance of them obtaining council accommodation in the foreseeable future.
  I want to look at some of the less fashionable districts of London to make my point that wherever one turns in London one cannot find a district, geographical or otherwise, where private rents are not very much higher than they are in the council sector. In S.E.17, for example, which is becoming fashionable—although, as I used to live there, I can assure the House that parts of the district are extremely unfashionable—a fully furnished flatlet, with linen, is going at £30 per month. That is £7·50 a week. That is hardly suitable for a married couple, or certainly a small family. That compares very unfavourably with the rent I have quoted for council accommodation. Across London in Bayswater, which is very much a mixture, a modern furnished flat, of two rooms plus kitchen and bathroom, which would suit a couple, is going for 18 guineas. The figures I am giving are not untypical, as any hon. Member who has had opportunity or need to look for furnished accommodation will bear out.
  Coming back to central London, W.C.1, again not a fashionable area, and where one might expect a rather more reasonable standard of rent, a flat of two rooms, kitchen and bathroom, said to be "luxury", although the advertisement does not say whether it has central heating, and "suiting two persons", is offered at £22 a week. That compares very unfavourably with the standard of accommodation and rents of the local authority sector.
  Some districts in the advertisements are merely listed by their postal numbers, such as W.3, W.4, W.6, W.10 and W.12. I am sure that they are very nice districts, but the advertisers do not bother to give names. In S.W.16 and 17 there are self-contained modern "mansion" flats. That means that they will not be very modern. These flats are of two, three, four or five rooms, with kitchen and bathroom, for a minimum of two people sharing, at £5·25 per person. So even for the smallest mansion flat in those districts the rent is £10·50 a week. That
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  is above the Greater London average for a modern three-bedroomed unfurnished flat with central heating.
  I know that one has to add a little element for furniture but, with the cost of land and housing in central London, I believe that is a very small element in the gross rent difference between furnished and unfurnished accommodation.
  Perhaps a more unfashionable district is Kentish Town, where a double room and kitchen are advertised at £9 a week. In Hornsey a double room and kitchen cost £10 a week. In Cricklewood two rooms and a kitchen cost £11 a week. In Stamford Hill two rooms and a kitchen cost £12 a week. In Kentish Town two rooms, kitchen and a bathroom costs £14 a week. And so on.
  Every day the newspapers are full of such offers of accommodation to let. But where are constituents of mine and, I suspect, of other hon. Members who represent urban conurbations to find accommodation in the columns of evening newspapers which advertise such accommodation for renting? They just cannot possibly afford such rents. I suspect that if they could afford them they could almost certainly afford the mortgage repayments on a house, provided that they could afford the deposit for a house.
  The allowances, such as they will be, for furnished rented accommodation are likely to be completely inadequate, in view of the rents being charged for such accommodation throughout the London area. What is more, whatever the allowances are initially, they are bound to be overtaken by rising rents. One of the dreadful features of the Housing Finance Act, which we pointed out, is that it will drive more and more people into the private rented accommodation market, putting pressure on the dwindling amount of accommodation, furnished and unfurnished, in London and other large towns. There is bound to be more competition for furnished accommodation in particular, because if one does not have accommodation to start with one cannot build a home in terms of buying furniture and having it stored; one must start in furnished accommodation. Therefore, there will be more and more competition, particularly from young married couples, for this sort of accommodation as the

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  Housing Finance Act begins to bite and as fair rents are reviewed regularly and spiral upwards because of this process of competition in the private rented accommodation market. Therefore, although this is a first step, it is such a pathetic and inadequate first step in providing rent allowances to private furnished tenants that I almost believe it is not worth bothering about. But it is a first step, and it would be grudging of us not to thank the Minister for having taken it.
  Let us hope that the Minister will be convinced, if not by hon. Members on this side of the House then by his hon. Friends, that such rent allowances, if they are to serve a useful social purpose, must not be the exact equivalent of those for tenants in local authority accommodation, where rents are lower and facilities are much better, but should be based on the need of the tenant, on the standard of the accommodation, and on the rent that he has to pay—not on the rent which, under the Housing Finance Act, is considered to be suitable to be paid by working-class people living in working-class districts.
  It has been said by many hon. Members that this system of allowances introduces means tests, and the point has been made, particularly by my hon. Friend the Member for Swindon (Mr. David Stoddart), that when there are means tests it is rare for more than half or three-quarters of those eligible for benefits to apply for and get them. There is bound to be a residual number of tenants in furnished accommodation who will either not hear about the rent rebates or, if they do, will suspect them of being a ruse eventually to get them out because, as we know, it is the private furnished tenants who have the least security of all, and they are the ones who, when they are evicted, form the growing band of homeless in London and elsewhere.
  High private rents for furnished accommodation could be justified if private landlords and those renting out private accommodation were investing the capital that they receive by way of rents into putting up more property for renting at reasonable prices, but we know that the tremendous rise in land prices in the last couple of years has virtually made
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  that prospect one that is just a mirage on the horizon.
  There is nowhere in London—except, perhaps, through housing associations and co-ownership associations—where private landlords are putting up blocks of flats or houses for renting on a furnished basis at reasonable rents. Indeed, it would probably not be economic for them to do so. What is happening, particularly in my area, is that more and more landlords, tempted by the high property prices of recent years in London and other conurbations, are beginning to sell with vacant possession or to sitting tenants their existing stocks of rented accommodation.
  The property boom in house and land prices during the last two years will indirectly make the shortage of rented accommodation even worse than it is now, and this, if it does nothing else, will on the pure law of supply and demand drive up rents even further in the private furnished and unfurnished sector. That in turn, under the Housing Finance Act, will influence the determination of fair rents whenever they are determined in a district, which in turn will force up proportionately the rents paid for council flats and housing, and we shall be on a merry-go-round of rising rents in the furnished and unfurnished parts of the private sector and in the local authority sector. This can have only one effect; namely, to harm the interests of those who wish to live in rented accommodation.
  There are other factors in the decline of rented accommodation, particularly in the London area. A large amount of this accommodation consists of rooms with shared kitchen and bathroom in the landlord's own house. A rise in property values is leading to a growing realisation on the part of such private landlords that if they can get rid of their tenants—which is very easy to do after someone has been to the rent tribunal and obtained six months' security of tenure, which means that he is then at the mercy of the local authorities, most of whom in this respect do a good job—they are then able to sell their houses with vacant possession and take advantage of the situation.
  The person who buys such a house will do so not in order to let off one or two

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  rooms but because it is the only accommodation that he can afford. We all believe in home ownership. Such a house will probably be bought by a young married couple with a family, and the last thing they want to do is to let the spare bedroom to a couple of old-age pensioners at £4 a week or something like that. So again this is going to increase the shortage of rented accommodation in the London area.
  I would suggest, therefore, that in these circumstances what private tenants, particularly in furnished accommodation, need—and I am merely reiterating now, because it is very difficult to avoid reiterating these few simple points—is security of tenure above all and reasonable accommodation at rents which are related to the quality of the accommodation. I often wish that the large number of council tenants who sometimes complain about the facilities and the rents in council flats could see the housing cases that many of us have to see, where people who are very badly off are paying very high rents in private furnished accommodation. They might then realise that there is another section of the community which is much worse off than they are.
  I think that only local authority control, certainly in the large conurbations, will be able to solve this problem of the supply of rented accommodation. I do not believe that the Bill at present before us will be more than a palliative. I do not believe that the Bill will lead to an increase in the supply of rented accommodation. Indeed, by virtue of giving rent allowances to people who otherwise might not be able to afford the accommodation it will have the effect of increasing rents. I think that this Bill will make the ultimate municipalisation of the rented housing market much easier, and for that reason I welcome it. I think there should be an eventual takeover of rented accommodation by local authorities, and this would end the stupid competition between local authorities and the private rental market whereby rises in rents in one sector where there is a great scarcity influence rents in the other sector, which is happening under the fair rent review and the Housing Finance Act, with the consequent vicious spiral of constantly rising rents in both sectors.
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  I believe that housing should be a social service, and we on this side of the House, if not some hon. Members on the other side, should have the courage to recognise this and treat it as such, and recognise also that ultimately subsidised rents, whether in the local authority sector or in the private rented sector as long as it exists, which I hope will not be for very much longer, are much cheaper than the social cost of homelessness, juvenile delinquency, and the other features of our urban society which in many cases stem from a bad home environment, the social consequences of the present free market in housing, from which we are beginning to depart. If this Bill is nothing more, it is a sign that this Government are now recognising that, in addition to interfering in the private unfurnished sector, they must start interfering, through rent allowances, in the private furnished sector. I welcome this and hope it will be the prelude to an ultimate takeover by local authorities generally throughout the country.
  8.47 p.m.
  Mr. Reginald Freeson: Perhaps I should first formally move the amendment as by a technical oversight this was not done earlier in the debate.
  I beg to move, to leave out from "That" to the end of the Question and to add instead thereof:
  "this House declines to give a Second Reading to a Bill which makes only a restricted provision for furnished rent allowances and does nothing to provide security of tenure and improved rent regulation for tenants of furnished dwellings, the lack of which is the biggest cause of increasing homelessness in the stress areas of our cities."
  So far as I have been informed the form of words of our amendment, which was subjected to some lighthearted criticism earlier in the debate by, I believe, the Minister and one or two of his hon. Friends, represented the only way open to us technically to table a reasoned amendment to say that in our view this measure is quite inadequate. It would not have been in order for us to object to the limited move being made by the Government in this sector, and this was the only way we could put our view on record. If there is criticism it must be directed once again to the procedures of the House rather than to the views of the Opposition.

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  The Minister and some of his hon. Friends have described the Bill as a substantial advance. One hon. Member said that it was a major step forward in housing policy. That was more than gilding the lily. My right hon. and hon. Friends and I believe that the Bill is a sop to pressures that built up from both sides of the House and outside it when the Housing Finance Bill was published last year. It was forcibly borne in upon the Government that a large section of tenants who received the worst treatment received no consideration. To the extent that the Government have finally yielded to pressures and representations made to them from different quarters they have produced a Bill which, although welcome within its small ambit, is misleading. It does not deal with the problems of which the question of allowances for furnished tenants is one aspect.
  In bringing the Bill forward in place of the more comprehensive measure which could and should have been introduced, the Government have shown once more their incoherence in housing policy. This is a puny measure which some hon. Members opposite hope will lull the public and interested groups and organisations into believing that action has been taken to protect furnished tenants and that thereafter we can all rest satisfied politically and socially that something has been done and nothing much further needs to be done.
  I hope it will be clearly understood by the public and by organisations and pressure groups which interest themselves particularly in housing and related social problems that little is being done by the introduction of the Bill. The Government's smallness of mind is made all the more marked by the political context within which the Bill is introduced. It is not for us to discuss today the draconian measures which are being introduced following the Government's failures in prices and incomes. The Bill, welcome within its small ambit, does not go to the heart of the problems facing the 600,000 to 700,000 furnished tenants.
  The main problems facing the inner areas of most of our cities, of which London has the biggest complex of problems, are the growing and not decreasing
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  problems of homelessness, exorbitant rents and the increasing shortage of good accommodation at reasonable rents. The personal and social stress which such conditions are creating increasingly for the families living in them is very largely induced by the constant insecurity of these families. Reports from our social workers who are involved closely in inner-city problems constantly point to this basic insecurity as being one of the causes of many other social and personal problems with which they have to contend.
  Finally, in listing these main problems which should be identified and tackled, we have the problem of decay and obsolescence to be found mainly in private tenanted property and which, notwithstanding the expansion of improvement grants under the Housing Act 1969, continues almost on the same scale as before the Act, since only a minute proportion of the improvements taking place with the support of the Act are in properties which are tenanted by the sort of people we have been speaking about.
  I want to go through these problems because they inter-relate and because to introduce a puny measure like the Bill without relating it to a number of policy aspects, some of which have been discussed in the debate, is to demonstrate the poverty of thought and action by the Government.
  The Minister referred to a meeting with the London Boroughs' Association yesterday at which the problems of homelessness were discussed arising, I take it, from the two working party reports which have been circulated and considered by local authorities throughout London. First it must be said that the reports do not deal with housing as such. They are essentially if not wholly reports dealing with how local authorities should administer their welfare powers to deal with the problems of homelessness coming their way and leave to the Department of the Environment rent and housing policies relating to homelessness.
  I was interested to hear the reply of the Minister to a question I put during his speech, when he said that only one person at yesterday's meeting had suggested that the biggest single immediate measure which could be taken to help

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  local authorities and the families concerned in the growing problems of homelessness would be to grant security of tenure. I do not know whether the person concerned was representative of others. But I was both surprised and interested to hear what the hon. Gentleman had to say because it does not reflect the views which I and my hon. Friends have been hearing from local authorities concerned in this question. I will certainly make it my business to get in touch with representatives of the LBA and local authorities in London and sound out their views, if need be bringing them back to the House.
  Mr. Channon: This shows how unwise I was to answer a question about what was, I suppose, a private meeting. The fact that only one person mentioned the point does not mean that others did not share his view. Indeed, I believe that they did.
  Mr. Freeson: I am glad to have that further explanation. I hesitate to pursue the point too far because I do not want to take up too much time from other aspects I wish to discuss. But in these two brief exchanges much lies. I take it from what the hon. Gentleman has just said that the majority view, if not the unanimous view, of the London boroughs is that security of tenure would be the biggest and most important immediate step which could be taken by the Government to help local authorities combat the problems of homelessness from which so many families suffer in London. That is the only interpretation that can be put on his further explanation. It is in line with the general impression—I put it no more strongly—that I have garnered from my conversations with local authority members throughout London, in particular throughout inner London.
  More and more housing managers, housing chairmen and members of local authorities are saying, when their views are sought on the problem of homelessness, that the biggest single immediate cause is lack of security in furnished accommodation. I trust that although the Government have refused to act so far they will take note of these views and consider them further and that they will not regard the Bill as their last word. If they do not, when we return to power we
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  shall take note of those views and act upon them.
  Before I proceed further to discuss the Bill in detail I must express my concern at the nature of a reply to a Question which I put to the Government on 20th December last year. It was in no way rhetorical or based upon a debating point, but was intended to seek information. It was tabled to the Secretary of State for the Environment but it was transferred quite correctly to the Secretary of State for Social Services and it asked what was his estimate of the number of families in homeless families hostels or rehoused by local authorities in 1971–72 whose previous accommodation had been in furnished dwellings. The reply I received from the Under-Secretary was:
  "I have consulted my right hon. and learned Friend the Secretary of State for the Environment but regret that there is no information available on which to base an estimate."—[OFFICIAL REPORT, 20th December 1972; Vol. 848 c. 371.]
  That answer deliberately misled myself and the House because that information is available. There is plenty of information available in the Grieve Report, in the returns made by local authorities about the homeless families with which they deal, in the returns made to the Department of Health and Social Security and in all the other surveys and probings which I know the Department of the Environment has undertaken into the problem of homelessness. This is yet another example of the kind of treatment to which we are becoming more and more accustomed from the Government. That was a non-answer which was totally misleading. If I wanted to take up the time of the House I could give the information from the many statistics which are available in print and which flow into the Government regularly on special forms which the Government require the local authorities to send them. I shall pursue this matter on another occasion when it is more appropriate to do so.
  I hope I shall be forgiven if, although speaking from the Opposition Front Bench, I illustrate my argument with a constituency point. I represent part of what is technically an outer London borough but one which is recognised as having a large degree of inner London borough characteristics. I am referring to the London Borough of Brent. I contacted my housing manager to ask for a

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  small sample to illustrate the position in our borough. Its problems are not untypical of those faced by all the other inner London boroughs and, at a lower level, by other big cities. I asked the housing manager to tell me how many homeless families had been rehoused by the local authority during the last 12 months who had previously lived in furnished accommodation and who had come to the local authority as a result of landlords taking action to get them out, whether it be notice to quit, court order proceedings or whatever else.
  This is by no means a measure of what is going on in the district; it is a measure only of the families who have been rehoused. I will not weary the House with all the figures that I have with me. I simply say that according to the housing manager six out of every seven cases related to furnished accommodation. That goes well above the high figures published by the Grieve Report, which is presumably still the subject of Government consideration.
  The Grieve Report published figures showing that something like 52 per cent. of applications came from people whose last homes had been privately rented furnished accommodation. That is well below the figure I have quoted for my own borough. I do not believe that my borough is worse than other inner London boroughs. In some ways it is better off as its northern half is not typical of inner London. It is the southern Willesden area which is typical. Other London boroughs wholly within the inner London area have much worse problems.
  Other surveys have been undertaken. Shelter conducted a survey of 160 hearings at inner London rent tribunals. It found that 84 per cent. of cases involved notices to quit and that rent fixing was incidental to the problems. That is from a report prepared by David Bebb, "Rent rebates for the furnished tenant." The report went on to urge security of tenure for furnished tenants
  "to keep them one step away from homelessness."
  The Grieve Report, Shelter, the Labour Party, the minority report of the Francis Committee, the Child Poverty Action
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  Group and others have recommended and argued in detail from case material the need for security of tenure to slow down the rate of homelessness in inner London and elsewhere.
  There is no question about the social and personal need for this scheme. All that we have had quoted in evidence against such a proposal is the weakest part of the Francis Report, the majority report. It was the worst argued section in the report; it produced no evidence. It expressed its view based upon a hunch, a feeling that to introduce such a scheme would reduce the level of furnished accommodation available. Without quoting all the reports and surveys and the recommendations which have been made by a variety of bodies I urge the Government to rethink what they are omitting today. It is the biggest single thing they can do immediately to tackle homelessness, apart from the medium to longer-term solutions of dealing with the basic provision of housing in the greater London area and other areas.
  The second problem I listed was exorbitant rents. Just as the Bill does not deal with security of tenure and homelessness, so it does not deal with exorbitant rents. What is the position? In London, and I speak only of rents, excluding rates, according to the figures produced by the family expenditure survey—a Government survey—the latest figures show average net rents in greater London of £4·75 per week for furnished accommodation and £2·61 a week for unfurnished accommodation. In Great Britain as a whole the figures are £3·91 a week for furnished accommodation as compared with £1·55 a week for unfurnished accommodation.
  As has been pointed out several times, families in furnished accommodation are generally those with the lowest incomes, living in the worst kind of housing conditions and paying the greatest sums. Will the allowances really tackle this?
  Mr. Clinton Davis: Does my hon. Friend agree that perhaps the majority of furnished rents are not available in the statistics because they are not referred to rent tribunals? Will he further agree that the incidence of rents is considerably higher in almost every inner London borough than the figures he has quoted?
  Mr. Freeson: I accept that. I would not necessarily accept that the figures produced by the family expenditure survey are based solely on the rents referred to rent tribunals which are only a minority—about 100,000 out of a total of something approaching 700,000. I certainly accept that all the samples and surveys so far conducted do not marry up with personal experience. My hon. Friend the Member for Walthamstow, West (Mr. Deakins) quoted a number of cases which are typical, not exceptional.
  During the Committee proceedings on the Housing Finance Bill we had occasion to query the kind of so-called typical rent figures which the Government thought were accurate. In my experience the average rents in my area which appear in official documents do not marry up with the facts. If there is some way of more accurately recording the realities of the situation, we should all welcome it and it should be looked at by the Government. In quoting these figures I was being moderate, not wishing to overstate the case, but I accept that they must be handled with reservation because they do not tie up with personal experience.
  Will the allowances help? I do not know whether the Government have done any exercises on this. They should at least have given to the House provisional illustrations of the impact of the Bill on typical cases. I have gone to an independent source for my figures without any preconceived idea of what they would produce. I went to our excellent House of Commons Library statistical division and asked for a calculation of the impact of the Bill on a person who applied for a rent rebate according to its procedures. The example that was taken was of a family in greater London, with the husband earning an average industrial wage of £32 a week, the wife not in employment and two children of school age, living in furnished accommodation at a reasonable rent of £4·75 a week net of rates.
  Following the Prime Minister's grand announcement about the increase in the needs allowance under the White Paper proposals still to be debated, I find that the rent allowance for that family would be 56p and the net rent £4·19. According to the official figures of the family expenditure survey the net rent for an
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  unfurnished dwelling would be £2·61. For a family outside greater London where the earnings would be an average of £29·70 with the wife not in employment and with two children at school, paying a net rent of £3·91, the rent allowance would be nil—rent payable £3·91. That is after the introduction of the increased needs allowance.
  I am prepared to make these tables available to the Minister because no doubt they will need to be examined to make sure that there is no error in calculation. The tables have been produced by a statistician who did not know the political use to which they would be put. If the figures are correct, they show that once more we are being conned into believing that grand assistance is being given to the people in greatest need, whereas at the end of the day they will still be paying highly excessive rents. If the people live in greater London they will receive marginal help but in other parts of the country they will receive a nil rent allowance. The Government should come clean and give typical examples of the help which they calculate will be given to the people in greatest need.
  Even 56p in greater London is worth having if it helps a family in need. Prior to the Prime Minister's announcement about the White Paper and the prices and incomes policy, this grand assistance to furnished tenants would have produced a nil rent allowance in greater London for the family I have instanced. The upshot of the Prime Minister's announcement is that that family will get an allowance of 56p to produce a net rent, ignoring rates, of £4·19.
  If a tenant gets a fair rent assessed by a local authority as the basis for a rent allowance, what is to stop the landlord putting up his rent? The Minister says that there will be confidentiality, but will there? That view does not accord with the experience of many of us in local government and in dealing with case work. When a local authority assesses as a basis for the rent allowance a much lower fair rent than that which is being charged, should it not also be the duty of the local authority and of any public representative or social worker to encourage the tenant to go to the rent tribunal to get his rent reduced? That is

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  what the rent tribunal is for. Under the law as it stands, however, and as it will remain when the Bill becomes law, if the tenant does that he will get notice to quit.
  Should not the local authority use its powers—powers which are rarely used—to refer cases direct to the rent tribunal when it discovers that the assessment of a fair rent shows that present rent is excessive? Do the Government agree that a local authority should use the powers which it possesses? These are specific points to which I should like the Under-Secretary of State to reply. These powers are granted by Parliament. Do the Government believe that a local authority should make direct reference to the rent tribunal to bring rents down to a reasonable level?
  Furthermore, if the powers are used, would not a notice to quit be issued by a landlord? As long as there is no security of tenure, it is inevitable that there will be a low take-up since tenants will be aware of what they are risking. Certainly local authorities, Members of Parliament and councillors who advise tenants will be fully aware of the risks they are creating for tenants. Many of us had experience of these problems years ago in trying to advise people to bring in public health inspectors under the provision of the 1957 Rent Act. Many health inspectors brought in resulted in notices to quit and that position will obtain as long as there is no security of tenure. It is no use our burking this issue. There must be security of tenure if a rent allowance scheme is to operate properly. The Government have a duty to explain why these powers are not being used and to give their view on the use of those powers in reasonable circumstances.
  I turn to the question of the contraction of the rental market, which is a subject directly relevant to furnished accommodation. This was a major argument in the majority report of the Francis Committee and was used as a basis of objection to the principle of security of tenure being adopted in this area of legislation. The Minister began by saying that he would give evidence on this topic, but he ended by giving only assertions that there would be a contraction of the market. The Francis Committee said that there was no evidence one way or the other.
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  Perhaps it is relevant to quote the figures which apply to the present situation. Between 1966 and 1971 rented accommodation fell by just under 68,000 tenancies. In the unfurnished sector the fall was 122,000-plus and in the furnished sector there was a growth of 54,500 tenancies. What is interesting to note is the fact that in the Census returns the figure where the type of tenure was not stated rose from 73,000 in 1966 to 171,000 in 1971. I believe that that figure is made up wholly of furnished tenancies. I believe that the number of furnished tenancies in greater London is much higher than the figure of 250,000 quoted by the Minister. I believe that the figure of furnished tenancies in greater London is in the region of 400,000.
  If I am correct, in the five years that we are discussing the number of furnished tenancies has increased by more than 152,000. In such circumstances we shall be talking about a figure approaching 400,000 tenancies concentrated in the main in inner London. There are about 900,000 dwellings in inner London. It means therefore that we are discussing 40 to 45 per cent. of all the households in inner London. That is no small problem.
  A broad assessment of the position in my constituency reveals that about one-third of the families living in that part of the borough are in furnished accommodation. What good is the Housing Finance Act to them? What benefit will rent allowances bring to them? In view of what I have said about insecurity, what good are the rent allowance proposals in this Bill to them? If my assessment of the position in my constituency is correct—and I made it for other purposes long before the introduction of the Bill—the sort of figure that it reveals is applicable to every inner London borough as well as to certain pockets in our other major cities where similar problems arise.
  That is the situation. We see a total reduction in the amount of tenanted accommodation that is available and in that sector an increase in the availability of furnished accommodation, most of which is substandard, for which exorbitant prices are being charged and in which there is no security of tenure. The Government propose to do nothing about these problems in this or in any other legislation.

  335
  The Minister has argued that presumably even if what I say is correct about the present contraction, if security of tenure were introduced for the furnished sector the situation would be exacerbated and would become disastrous overnight since there would be a considerable further contraction. The logic of that is that the very limited control over the market which exists at present means that there will not be a contraction, and the further logic of that is that the same principle should be applied in the unfurnished sector. But we had such logic in 1957, and I do not say that to make an old, hoary political point. At the time of the 1957 Rent Act which decontrolled rented accommodation it was argued by the right hon. Member for Wolverhampton, South-West (Mr. Powell) who was then Parliamentary Secretary to the old Ministry of Housing and Local Government, that in order to provide the necessary incentive to get more building to rent that Act was essential—to stop the contraction in tenanted accommodation and that Act was essential if we were to solve the country's housing problems. It did not solve our housing problems. They are still with us. It did not stop the contraction in the availability of tenanted accommodation. Between 1957 and 1965 there was a reduction of 1 million dwellings throughout the country which previously had been tenanted.
  The Minister said that all the evidence of history shows that if security is given the result is the loss of a proportion of rented accommodation. The evidence points the other way. When there was decontrol there was massive selling out of the rented property market, and it will continue along this road unless other steps are taken which I shall list.
  As my hon. Friends have argued, supported by Miss Lyndal Evans in the minority report of the Francis Committee where some figures were quoted and proper logic was used in the argument on this score compared with the majority of the committee, there is no reason to believe, on the facts so far available, to put it no stronger, that most furnished dwellings will be sold into owner-occupation should security of tenure be introduced. Most of the property concerned is of a kind which is not in prospect to be sold into owner-occupation
  336
  as is happening, largely in stress areas, regarding unfurnished accommodation. Contraction is taking place now and the Government are doing nothing to stop it. Indeed, without pursuing it too far, by constantly pressing local authorities to sell off rented properties indiscriminately, they are deliberately encouraging a contraction of the rented property market when they know that there is a need to expand it, at least in stress areas.
  There is no evidence to support the idea that if we introduced security of tenure we shall have a disastrous cut-back in the rented accommodation that is available. On the contrary, if anything, the evidence points the other way. There is plenty of evidence, to which I and others have pointed, which shows the need for action to help people living in rented accommodation.
  I close my remarks on this score by listing the points that we wish to see taken up as policy by the Government, and which we will pursue when we are returned to power, in dealing with housing stress in our big cities. First, it is clear from what I have argued that we would introduce security of tenure for all tenants in furnished accommodation, other than those sharing owner-occupiers' homes and certain other categories which have been discussed in detail by certain hon. Members. Second, we would introduce rent regulations for such tenants. Third, we would ensure action by local authorities to hold the rental market, particularly in the stress areas of our cities, by buying privately rented dwellings directly or by registered housing associations being used in co-operation with the local authorities concerned.
  Fourth, we would introduce what we describe as tenants' enfranchisement to put a stop to the buying and selling of rented accommodation over the heads of tenants, with constantly spiralling prices and pressures being put upon them, so that they could register as co-operative housing associations and, with the help of local authorities, buy they own homes instead of being bandied about by property speculators. Fifth, we would encourage public authorities by action, not just by talk, to buy land in outer city areas to meet the property needs of families in the congested areas of our

  337
  cities whether by municipal lettings, by housing associations or by co-operatives, as well as owner-occupation which already takes place in these areas.
  These five points which I have listed should be seen in their totality. They must be inter-linked. To treat this problem as if we are giving major assistance to furnished tenants by this paltry Bill is to mislead the public and to deny political responsibility for any sensible housing policy in tackling the problems of stress areas in our cities.
  9.29 p.m.
  The Under-Secretary of State for the Environment (Mr. Reginald Eyre): We have had a useful debate, perhaps a longer debate than some hon. Members expected. I shall endeavour to reply to the points of principle which have been raised. Before doing so I should like to thank my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams), who has a considerable knowledge of the housing problems in his constituency, for the welcome that he gave to the Bill on behalf of his constituents who will benefit under the Bill's provisions.
  Security for furnished tenants has played an important part in the debate. I wish to make it clear that the Government are not prepared to contemplate any measure which might have the result that tenants ended up not better off but worse off. That does not mean that we are insensitive to the problems of families who are forced to make their homes in furnished accommodation. On the contrary, we want to help, as the measure shows. However, I must ask the House to look realistically at the risks of further intervention.
  First, what would be the effect of giving security to tenants on the availability of accommodation? We already know that in many areas, particularly in inner London and the centres of the other great conurbations, rented accommodation is in desperately short supply. In the light of experience in the unfurnished sector, and with the solemn warning of the Francis Committee before us, the Government believe that a lot of furnished accommodation would rapidly go off the market.
  In the light of experience of recent matters which were partly dealt with by the Francis Committee—
  Mr. Crosland: What experience?
  Mr. Eyre: Perhaps the right hon. Gentleman will let me continue and make my speech. I listened to the right hon. Gentleman's speech with great interest. He will understand that existing tenants would have greater protection. However, as tenants moved out, and furnished tenants include a high proportion of migrant workers, transients, and young couples who spend a few months in rented accommodation as a stepping stone to their own house, so will property cease to be let. In a short time we could be faced with a widespread dearth of such accommodation to let. The Government believe that that might lead to a critical situation.
  I should like to emphasise that the Government are concerned to tackle at their roots the considerable problems which exist in the stress areas. That means increasing the supply of accommodation generally within the critical areas through local authority building and the work of the housing associations. I noticed that the right hon. Gentleman emphasised during the course of his speech the importance of the contribution which the housing associations can make in that respect. The Government want to take the stress off stress areas. Regulatory intervention alone will not solve the supply problem. In fact, it could make it worse, and it might be widely unenforceable. These are the realities of the situation, which the House should keep clearly in view.
  The Bill is a measure to help furnished tenants. It is not a vehicle through which the law—
  Mr. Crosland: The Under-Secretary of State is courteous in giving way. However, the hon. Gentleman, as did the Minister, has referred to evidence and experience without advancing the proposition that security of tenure would diminish the supply of rented accommodation. References are made to evidence and experience, and we long to hear either of the evidence or of the experience, but we get neither. We get nothing but assertions.
  Mr. Eyre: If the right hon. Gentleman will bear with me for a few moments, I shall try to return to the more specific items that he quoted and the main theme.

  339
  I was saying that these are the realities of the situation which the House should keep clearly in view. The Bill is a measure to help furnished tenants. It is not a Bill through which the law on security should or could be changed. Of course the Government are aware of the strength of the sort of arguments which we have heard today, but I repeat that we are not prepared to do anything in the furnished field which might leave the tenants worse off.
  It seemed to me as I listened to his speech that the right hon. Member for Grimsby (Mr. Crosland) recognised the difficulties of the situation in the matter of security of tenure. He fairly conceded that security had not been put into effect by the Labour Administration. If one considers the 1966 Census and the situation up to 1970, one wonders why, had it been such an easy solution as the right hon. Gentleman seemed to imply, the Labour Government should not have gripped this matter.
  The right hon. Gentleman then referred to the "huge financial advantages" of selling rather than of continuing to let. I believe that what he said was right. The words that he used qualified any support that he expressed for the minority report by Miss Lyndal Evans, which rested upon the proposition that landlords are unable to sell their property. It interested me that, having reviewed the balance of evidence on either side, as he did extremely well, the right hon. Gentleman should have concluded that a decision on security was a matter of judgment.
  The right hon. Gentleman went on to mention a further factor against the introduction of security. It was the danger that landlords, having to accept that furnished tenants would get security, would become much more selective in their choice of tenants and would tend to avoid so far as possible those with obvious disabilities, such as coloured tenants or single mothers, and would tend to choose others. I was very impressed by his argument in that respect, because it adds up to my own knowledge and experience of these matters in Birmingham.
  Mr. Douglas-Mann: Would the Minister at least undertake to consider the detailed figures, which show that there
  340
  has been a steady decline in rented accommodation ever since the war but that there have been two bumps in that decline? One was an acceleration of the decline immediately after the 1957 Rent Act and the other was a slowing down in the decline after the 1965 Rent Act? If my interpretation of these figures is correct, do they not show that increased security reduces the decline and that reduced security increases it?
  Mr. Eyre: With respect, the introduction of further measures of security temporarily interrupts the rate of decline, but if the hon. Gentleman looks at the record of protection and security against the historical background of tenancies, he will have to concede that during this time the imposition of security, the requirement that rents shall not match the cost of repair or a reasonable return upon the capital value and other factors, added together, have caused landlords to move out of rented properties as rapidly as possible. That is what has happened over the last 50 years, and it has been only temporarily interrupted by attempts by the Legislature, for understandable social reasons, to deal with the situation.
  Mr. George Cunningham: In that case, do the Government intend to abolish security for unfurnished accommodation in order to enlarge the market for it?
  Mr. Eyre: The hon. Gentleman will understand that the Government are aware of the extreme importance of protection of the kind we have now in present circumstances affecting the security of the home of families who are resident in protected tenancies.
  Mr. George Cunningham: What is the difference between the two?
  Mr. Eyre: The hon. Gentleman should not dismiss this argument, because it is a serious one. One looks at Sweden, where there was evidence, too, of a similar decline and housing problems, even in the rich city of Stockholm, again acknowledged by many experts to have been brought about by a persistent and unreasonable form of control. In trying to make an honest analysis of the cause of the decline in the rented sector, the fact is that if the mass of properties providing rented accommodation cannot produce an income which matches the needs

  341
  for proper care and maintenance and for a reasonable return on capital, inevitably there will be a movement out of that kind of property.
  The hon. Member for Kensington, North (Mr. Douglas-Mann), in a speech which showed great awareness of tenants' difficulties in London, referred to Miss Lyndal Evans and the report which claimed that 46 per cent. of furnished premises consisted of single rooms which were not saleable. The hon. Gentleman has considerable experience of property matters and I am not presuming to say that I know his part of London nearly as well as he does. But just over a year ago, before I came to my present job, I was taken to visit a house on the fringe of the hon. Gentleman's constituency. It was a substantial older-type house that had been converted some time ago into five flats. The five flats were subdivided and let as single rooms. I therefore assumed that they would have been single rooms which appeared in the statistics that the hon. Gentleman quoted. I must tell him that the flats—from his experience he will know of hundreds of similar properties—of which the single rooms were part were eminently saleable. The owner at that time, whom I did not know well—it was not my special concern—expressed the intention of selling those flats if protection in the form of security was imposed upon the situation he had with these furnished lets.
  Mr. George Cunningham: What did the hon. Gentleman expect him to say?
  Mr. Douglas-Mann: Surely the landlord could sell the flats in question only if he got possession of all of them. If the furnished tenant had security, he would not be able to do so.
  Mr. Eyre: With respect, the hon. Gentleman's argument was that 46 per cent. of furnished accommodation consisted of single rooms that were not saleable by themselves. I am merely saying that here was a concrete example of a situation, which I believe is repeated many times in his part of London, where the single rooms are often saleable units. I am trying to take the most serious notice of the arguments of right hon. and hon. Members of the Opposition. There is a considerable danger that many of these
  342
  properties would be sold off. As the right hon. Member for Grimsby (Mr. Crosland) said, that balance of argument and evidence and so on, is a matter of judgment in deciding this important matter. I am bound to feel cautious in the interests of many tenants in these circumstances.
  It has been suggested during the debate that the only effect of the Bill will be to line the pockets of landlords, who will simply raise rents when their tenants are in receipt of a rent allowance. I was very glad that this argument was firmly rejected by my hon. Friend the Member for Hemel Hempstead (Mr. Allason) in his excellent speech. The first point to be emphasised is that there is no reason why a landlord should know that his tenant is receiving an allowance in the normal course of events. However, I grant that this will not always be so; for example, in a case where there is an out-of-date rent on the register, which might need to be brought up-to-date for a full allowance to be paid. But wherever possible we want the whole question of allowances to be a matter between the tenant and his local authority alone.
  Mr. Freeson: What is the register to which the hon. Gentleman is referring?
  Mr. Eyre: The register of furnished rents. We want the whole question of the allowance to be a matter between the tenant and his local authority, and we shall be asking local authorities to respect this confidentiality. I hope that that will help the constituents of the hon. Member for Paddington, North (Mr. Latham) in the circumstances that he described.
  Mr. Latham: The point I was making was that the rents of many of the tenants in my constituency are not registered. If the amount has to be determined for registration, how can that be done without involving the landlord?
  Mr. Eyre: Where there are no registered rents a local authority will be entitled to ask for the advice of the rent officer. I stress again that the same confidentiality will apply, and there will be no need for the landlord to know that the rent officer has been consulted informally in this respect.
  Mr. Nigel Spearing (Acton): Many of my constituents will be in this situation.

  343
  Does the hon. Gentleman mean that the registered rent will not be registered in the statutory sense in which it is now, but will be a notional registration by which the rent officer will give his opinion as to what the rent might be if there were a proper registered rent?
  Mr. Eyre: The hon. Gentleman knows that many furnished tenancies do not have registered rents. It is often at the wish of the parties to the agreement that they are not so registered. In those circumstances, the rent officer can advise the local authority informally about the rent payable in the terms of the Bill, upon which will be based the rent allowance. That can be done on a basis of confidentiality, and I hope that that will help the constituents of London Members.
  Mr. T. L. Iremonger: Surely Part VI contracts are referable to the tribunal, and not to the rent officer?
  Mr. Eyre: We are talking about cases where no reference has been made to the tribunal. I was discussing the administrative system upon which the rent allowance would be based.
  Secondly, it will be easier for a tenant in receipt of an allowance to get a rent registered by the tribunal. Non-payment of rent is one of the main reasons why a landlord gives his tenant notice to quit, and, of course, the allowance scheme is intended to help tenants who have difficulty finding the rent. An otherwise good tenant, therefore, who might have faced eviction for non-payment of rent will now be able to ask the rent tribunal for a registered rent in the knowledge that the tribunal is unlikely to be presented with convincing evidence from the landlord that the tenant should not enjoy six months' security and full extension of that security for further periods. I certainly hope that the tribunals will recognise the important rôle which they will have to play in this respect.
  The Government thus acknowledge that there is a risk that in the minority of cases some landlords may seek further to increase their rents in the hope of getting the benefit for themselves. But the Government believe that confidentiality between tenant and local authority and the rent tribunals will go a long way towards preventing such abuse.
  344
  The Government do not subscribe to the view, implicit in the allegation, that the allowances will turn out to be a landlords' bonanza, that landlords generally are interested only in exploiting their tenants. As the Francis Committee showed, the majority of landlords and tenants are on good or reasonable terms with each other, and it would be strange indeed if the availability of an allowance for a tenant itself destroyed a good relationship where one already existed. We hope very much, therefore, that there will be no scaremongering on this issue, for such scaremongering could do nothing but harm, especially to those most vulnerable in terms of tenure.
  The hon. Member for Willesden, East (Mr. Freeson) posed a series of what the right hon. Gentleman the Leader of the Opposition used to call hypothetical questions about local authorities. I will reply to him on the general principle, and, as he knows, I should be only too glad to help him later on if he wanted further details.
  The power of a local authority to refer the rent of a furnished letting to the rent tribunal is discretionary. There is no obligation on it to do so, and in a stress area it will know whether this would be a reasonable course. Where it is not, the power will not be used.
  The right hon. Gentleman the Member for Grimsby asked whether the help was adequate, and mentioned, on the basis of the new allowances, a particular case. The example he quoted was one in which the tenant would receive 82p as an allowance—not 22½p, which was printed earlier before there was the change, as the right hon. Gentleman acknowledged. The right hon. Member based his argument on one case. The hon. Gentleman the Member for Willesden, East also asked me to give further examples. I will certainly look in detail at the special case he quoted.
  The first example I want to give is of a married couple with three children, with an income of £30 and a gross rent of £8 for five rooms. The estimated fair rent plus 25 per cent. would be £5·50; therefore the allowance would be £2·7l—a very useful allowance. The next case is that of a married couple with one child, an income of £25 and a gross rent of £8 for four rooms. The estimated fair

  345
  rent plus 25 per cent. would be £5, and in those circumstances the allowance would be £2·32. The third case is that of the mother of one child with an income of £20 and a gross rent of £7 for two rooms. The estimated fair rent plus 25 per cent. would be £4·50, and the allowance in those circumstances would be £2·95. Then I would quote the case of a married couple with no children, an income of £18 and a gross rent of £8 for three rooms. The estimated fair rent plus 25 per cent. would be £4, and the allowance in those circumstances would be £2·34. I think it will be acknowledged that those allowances would be of substantial benefit to tenants in the circumstances I have described.
  Several hon. Members thought that the estimated fair rent plus one-quarter would fall too far short of the actual rent to be fair to the tenant and to give him effective help. I accept that this is a difficult matter and it is not easy to get hard evidence, but those with whom we discussed the matter—local authority officers and members of rent tribunals—were agreed that this was the best and fairest way of proceeding, at least to start with and until any evidence for a different formula emerges from experience. I am trying to be perfectly honest about this situation. We are making a good start in dealing with a difficult social problem, and I maintain that this is a reasonable starting point. We have taken power to amend the formula either for all local authorities or for a group of authorities if experience suggests that it should be different, and this should help to meet in some degree the reservations raised by the hon. Member for Rochdale (Mr. Cyril Smith), who made a most attractive speech in this debate and indicated his support for the Bill subject to reservations, with the most substantial of which I have just dealt.
  A number of hon. Members have raised important questions about the take-up of rent rebates and allowances. Based on information from the family expenditure survey, an estimate was given to the Standing Committee that about 35 per cent. of all council and new town tenants—about 1¾ million—would be eligible for rent rebates in 1972–73. From preliminary reports received from every region about the number of rebates
  346
  granted, it appears that this estimate has proved remarkably accurate and that there is a very high take-up of those eligible.
  A high take-up of council tenants was expected, because authorities are in close contact with their tenants and are required to furnish details of rent rebate schemes at least once a year and also when they vary their schemes or increase their allowances.
  Some examples of the take-up of rebate in different authorities are: the County Borough of Dudley, 40 per cent. of tenants; Warrington, 33 per cent.; the London Boroughs of Brent and Bromley, 36 per cent.; Altrincham, 25 per cent.; Reigate, 31 per cent.; Northfleet, 32 per cent.; Sandbach, 30 per cent.; Sevenoaks Rural District Council, 26 per cent.; and Stroud, 37 per cent.
  Authorities were required to introduce their rent allowance schemes for unfurnished tenants only by 1st January 1973, so the schemes have only just started. Initial reports indicate that the number of applications have been fewer than expected, but it is hoped that the take-up rate will increase as the scheme becomes more widely known through publicity by the Department and by authorities. This will continue until satisfactory take-up figures are achieved. The estimated number of private unfurnished tenants eligible for allowances is between 700,000 and 800,000 in 1972–73. Of these about 260,000 already receive help with their rent from supplementary benefit.
  The right hon. Member for Grimsby asked what proportion of tenants will he eligible under the Bill and will claim. There are about 600,000 furnished tenants. Approximately 120,000 of them already have the benefit of supplementary benefit. This leaves 480,000 tenants of furnished premises, of whom it is estimated that about one-quarter or 120,000 will be eligible.
  If we assume a good rate of take-up—say, 100,000, though I admit that we have to go some way to reach that level—and have about £8 million available, that would work out at approximately £80 a head, which is not a trivial sum. If we succeed in this policy we shall be glad to go on and give further help, and we would not mind if the total cost rose in

  347
  those justifiable circumstances where we knew that help was going to those who deserved it.
  This is the first Bill in this field, and this is the first time that any Government have attempted to provide help of this kind to furnished tenants. We are not seeking in the Bill to provide a complete new charter for furnished tenants. We recognise the realities of the situation in the furnished rented sector. Our purpose in bringing the Bill forward is more
  limited. Our aim is to give help quickly to furnished tenants who need help. The Bill will provide furnished tenants with a very substantial measure of help. This is a novel, compassionate and important measure to which I hope the House will give its full support.
  Question put, That the amendment be made:—
  The House divided: Ayes 163, Noes 193.

  Division No. 35.]

  AYES

  [10.0 p.m.

  Abse, Leo

  Gourlay, Harry

  Orbach, Maurica

  Albu, Austen

  Grant, George (Morpeth)

  Orme, Stanley

  Archer, Peter (Rowley Regis)

  Grant, John D. (Islington, E.)

  Oswald, Thomas

  Armstrong, Ernest

  Hamilton, William (Fife, W.)

  Parker, John (Dagenham)

  Ashton, Joe

  Hamling, William

  Parry, Robert (Liverpool, Exchange)

  Atkinson, Norman

  Hannan, William (G'gow, Maryhill)

  Pendry, Tom

  Barnett, Guy (Greenwich)

  Hardy, Peter

  Perry, Ernest G.

  Bishop, E. S.

  Harrison, Walter (Wakefield)

  Prentice, Rt. Hn. Reg.

  Blenkinsop, Arthur

  Hattersley, Roy

  Prescott, John

  Boardman, H. (Leigh)

  Heffer, Eric S.

  Price, J. T. (Westhoughton)

  Booth, Albert

  Horam, John

  Price, William (Rugby)

  Bottomley, Rt. Hn. Arthur

  Howell, Denis (Small Heath)

  Reed, D. (Sedgefield)

  Brown, Ronald (Shoreditch & F'bury)

  Hughes, Robert (Aberdeen, N.)

  Rees, Merlyn (Leeds, S.)

  Buchan, Norman

  Hughes, Roy (Newport)

  Roberts, Albert (Normanton)

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

  Irvine, Rt. Hn. Sir Arthur(Edge Hill)

  Roberts, Rt. Hn. Goronwy (Caernarvon)

  Callaghan, Rt. Hn. James

  Janner, Greville

  Robertson, John (Paisley)

  Campbell, I. (Dunbartonshire, W.)

  Jeger, Mrs. Lena

  Roderick, CaerwynE.(Brc'n & R'dnor)

  Carmichael, Neil

  Jenkins, Hugh (Putney)

  Rodgers, William (Stockton-on-Tees)

  Carter-Jones, Lewis (Eccles)

  Johnson, Walter (Derby, S.)

  Roper, John

  Castle, Rt. Hn. Barbara

  Jones, T. Alec (Rhondda, W.)

  Ross, Rt. Hn. William (Kilmarnock)

  Clark, David (Coins Valley)

  Kaufman, Gerald

  Rowlands, Ted

  Cocks, Michael (Bristol, S.)

  Kerr, Russell

  Sandelson, Neville

  Concannon, J. D.

  Kinnock Neil

  Sheldon, Robert (Ashton-under-Lyne)

  Crawshaw, Richard

  Lambie David

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

  Crosland, Rt. Hn. Anthony

  Lamborn, Harry

  Silkin, Rt. Hn. John (Deptford)

  Crossman, Rt. Hn. Richard

  Lamond, James

  Sillars, James

  Cunningham, G. (Islington, S.W.)

  Latham, Arthur

  Silverman, Julius

  Dalyell, Tarn

  Lawson, George

  Skinner, Dennis

  Davidson, Arthur

  Leonard, Dick

  Spearing, Nigel

  Davis, Ifor (Gower)

  Leonard, Dick

  Spriggs, Leslie

  Davis, Clinton (Hackney, C.)

  Lewis, Ron (Carlisle)

  Stallard, A. W.

  Davis, Terry (Bromsgrove)

  Lipton, Marcus

  Stewart, Donald (Western Isles)

  Deakins, Eric

  Mabon, Dr. J. Dickson

  Stoddart, David (Swindon)

  Dell, Rt. Hn. Edmund

  McBride, Neil

  Stonehouse, Rt. Hn. John

  Dempsey, James

  McCartney, Hugh

  Strang, Gavin

  McElhone, Frank

  Doig, Peter

  McGuire, Michael

  Summerskill, Hn. Dr. Shirley

  Dormand, J. D.

  Mackintosh, John P.

  Thomas, Jeffrey (Abertillery)

  Douglas, Dick (Stirlingshire, E.)

  McMillan, Tom (Glasgow, C.)

  Tinn, James

  Douglas-Mann, Bruce

  McNamara, J. Kevin

  Torney, Tom

  Duffy, A. E. P.

  Mahon, Simon (Bootle)

  Tuck, Raphael

  Dunn, James A.

  Marks, Kenneth

  Urwin, T. W.

  Dunnett, Jack

  Marsden, F.

  Varley, Eric G.

  Eadie, Alex

  Marshall, Dr. Edmund

  Wallace, George

  Edelman, Maurice

  Mayhew, Christopher

  Watkins, David

  Edwards, Robert (Bilston)

  Meacher, Michael

  Weitzman, David

  Ellis, Tom

  Mellish, Rt. Hn. Robert

  Wellbeloved, James

  Evans, Fred

  Mendelson, John

  White, James (Glasgow, Pollok)

  Faulds, Andrew

  Millan, Bruce

  Willey, Rt. Hn. Frederick

  Fitt, Gerard (Belfast, W.)

  Miller, Dr. M. S.

  Wilson, Alexander (Hamilton)

  Fletcher, Ted (Darlington)

  Milne, Edward

  Wilson, William (Coventry, S.)

  Ford, Ben

  Mitchell, R. C. (S'hampton, Itchen)

  Woof, Robert

  Fraser, John (Norwood)

  Morris, Alfred (Wythenshawe)

  Freeson, Reginald

  Morris, Charles R. (Openshaw)

  TELLERS FOR THE AYES:

  Galpern, Sir Meyer

  Murray, Ronald King

  Mr. James Hamilton and

  Gilbert, Dr. John

  Oakes, Gordon.

  Mr. Joseph Harper.

  Golding, John

  O'Halloran, Michael

  NOES

  Adley, Robert

  Atkins, Humphrey

  Benyon, W.

  Allason, James (Hemel Hempstead)

  Awdry, Daniel

  Berry, Hn. Anthony

  Archer, Jeffrey (Louth)

  Balniel, Rt. Hn. Lord

  Biffen, John

  Astor, John

  Bennett, Dr. Reginald (Gosport)

  Biggs-Davison, John

  Boardman, Tom (Leicester, S.W.)

  Haselhurst, Alan

  Page, Rt. Hn. Graham (Crosby)

  Boscawen, Hn. Robert

  Hastings, Stephen

  Pardoe, John

  Bossom, Sir Clive

  Hawkins, Faul

  Parkinson, Cecil

  Bowden, Andrew

  Hayhoe, Barney

  Percival, Ian

  Brewis, John

  Heath, Rt. Hn. Edward

  Pounder, Rafton

  Brinton, Sir Tatton

  Hill, John E. B. (Norfolk, S.)

  Powell, Rt. Hn. J. Enoch

  Brown, Sir Edward (Bath)

  Hill, James (Southampton, Test)

  Price, David (Eastleigh)

  Bryan, Sir Paul

  Hordern, Peter

  Prior, Rt. Hn. J. M. L.

  Buck, Antony

  Hornby, Richard

  Pym, Rt. Hn. Francis

  Bullus, Sir Eric

  Hornsby-Smith, Rt. Hn. Dame Patricia

  Raison, Timothy

  Burden, F. A.

  Howe, Rt. Hn. Sir Geoffrey

  Ramsden, Rt. Hn. James

  Butler, Adam (Bosworth)

  Howell, David (Guildford)

  Redmond, Robert

  Campbell, Rt. Hn. G.(Moray & Nairn)

  Howell, Ralph (Norfolk, N.)

  Reed, Laurance (Bolton, E.)

  Carr, Rt. Hn. Robert

  Hutchison, Michael Clark

  Rees-Davies, W. R.

  Channon, Paul

  Iremonger, T. L.

  Rhys Williams, Sir Brandon

  Chapman, Sydney

  Irvine, Bryant Godman (Rye)

  Ridley, Hn. Nicholas

  Chichester-Clark, R.

  James, David

  Rippon, Rt. Hn. Geoffrey

  Jennings, J. C. (Burton)

  Roberts, Wyn (Conway)

  Churchill, W. S.

  Johnston, Russell (Inverness)

  Rost, Peter

  Clegg, Walter

  Jopling, Michael

  Russell, Sir Ronald

  Cooke, Robert

  Kaberry, Sir Donald

  Scott, Nicholas

  Cooper, A. E.

  Kellett-Bowman, Mrs. Elaine

  Scott-Hopkins, James

  Corfield, Rt. Hn. Sir Frederick

  Kershaw, Anthony

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

  Cormack, Patrick

  Kimball, Marcus

  Shelton, William (Clapham)

  Costain, A. P.

  King, Evelyn (Dorset, S.)

  Shersby, Michael

  Crouch, David

  King, Tom (Bridgwater)

  Sinclair, Sir George

  d'Avigdor-Goldsmid, Sir Henry

  Kinsey, J. R.

  Skeet, T. H. H.

  d'Avigdor-Goldsmid, Maj.-Gen. Jack

  Knight, Mrs. Jill

  Smith, Cyril (Rochdale)

  Dean, Paul

  Knox, David

  Soref, Harold

  Dixon, Piers

  Lamont, Norman

  Speed, Keith

  Dodds-Parker, Sir Douglas

  Lane, David

  Spence, John

  du Cann, Rt. Hn. Edward

  Le Marchant, Spencer

  Sproat, Iain

  Dykes, Hugh

  Lewis, Kenneth (Rutland)

  Stanbrook, Ivor

  Eden, Rt. Hn. Sir John

  Longden, Sir Gilbert

  Steel, David

  Elliot, Capt. Walter (Carshalton)

  Loveridge, John

  Stoddart-Scott, Col. Sir M.

  Elliott, R. W. (N'c'tle-upon-Tyne, N.)

  Luce, R. N.

  Stokes, John

  Eyre, Reginald

  MacArthur, Ian

  Stuttaford, Dr. Tom

  Fell, Anthony

  McCrindle, R. A.

  Tapsell, Peter

  Fenner, Mrs. Peggy

  McLaren, Martin

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

  Fidler, Michael

  McMaster, Stanley

  Taylor, Frank (Moss Side)

  Finsberg, Geoffrey (Hampstead)

  McNair-Wilson, Michael

  Taylor, Robert (Croydon, N.W.)

  Fisher, Nigel (Surbiton)

  Maddan, Martin

  Tope, Graham

  Fletcher-Cooke, Charles

  Maginnis, John E.

  Trafford, Dr. Anthony

  Fookes, Miss Janet

  Mather, Carol

  Trew, Peter

  Fortescue, Tim

  Maude, Angus

  Tugendhat, Christopher

  Fowler, Norman

  Maudling, Rt. Hn. Reginald

  Turton, Rt. Hn. Sir Robin

  Fox, Marcus

  Meyer, Sir Anthony

  Vaughan, Dr. Gerard

  Fry, Peter

  Mills, Stratton (Belfast, N.)

  Waddington, David

  Gardner, Edward

  Mitchell, Lt.-Col. C. (Aberdeenshire, W)

  Walder, David (Clitheroe)

  Gibson-Watt, David

  Moate, Roger

  Walker-Smith, Rt. Hn. Sir Derek

  Goodhart, Philip

  Molyneaux, James

  Ward, Dame Irene

  Gower, Raymond

  Monks, Mrs. Connie

  Weatherill, Bernard

  Grant, Anthony (Harrow, C.)

  Monro, Hector

  White, Roger (Gravesend)

  Gray, Hamish

  Montgomery, Fergus

  Wiggin, Jerry

  Green, Alan

  Morgan-Giles, Rear-Adm.

  Wilkinson, John

  Griffiths, Eldon (Bury St. Edmunds)

  Mudd, David

  Woodnutt, Mark

  Grimond, Rt. Hn. J.

  Murton, Oscar

  Worsley, Marcus

  Grylls, Michael

  Nabarro, Sir Gerald

  Younger, Hn. George

  Gummer, J. Selwyn

  Nicholls, Sir Harmar

  Gurden, Harold

  Normanton, Tom

  TELLERS FOR THE NOES:

  Hall, John (Wycombe)

  Onslow, Cranley

  Mr. Kenneth Clarke and

  Harrison, Col. Sir Harwood (Eye)

  Owen, Idris (Stockport, N.)

  Mr. Victor Goodhew.

  Question accordingly negatived.
  Main Question put forthwith pursuant to Standing Order No. 39 (Amendment on second or third reading) and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

  BUSINESS OF THE HOUSE
  Ordered,
  That the Fire Precautions (Loans) Bill may be proceeded with at this day's Sitting, though opposed, until any hour.—[The Prime Minister.]

  FURNISHED LETTINGS (RENT ALLOWANCES) [MONEY]
  Queen's Recommendation having been signified—
  Resolved,
  That, for the purposes of any Act of the present Session to amend the provisions of
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  the Housing Finance Act 1972 and the Housing (Financial Provisions) (Scotland) Act 1972 relating to payment of rent allowances to tenants of dwellings, it is expedient to authorise the payment out of money provided by Parliament of any increase in the sums so payable under any other Act which is attributable to any provision of the said Act of the present Session which amends either of the said Acts of 1972 to provide rent allowances for persons occupying dwellings under contracts to which Part VI of the Rent Act 1968 applies or would apply but for section 70(3)(a) or (b) thereof, or contracts to which Part VII of the Rent (Scotland) Act 1971 applies or would apply but for section 85(3)(a) or (b) thereof, and for tenants under furnished lettings of housing authority dwellings; and to authorise any payment into the Consolidated Fund.—[Mr. Eyre.]

  FIRE PRECAUTIONS (LOANS) BILL
  Order for Second Reading read.
  10.10 p.m.
  The Under-Secretary of State for the Home Department (Mr. David Lane): I beg to move, That the Bill be now read a Second time.
  Our debate is taking place against the shadow of the tragic fire last weekend at Exmouth. I would like to express the sympathy of the Government with the families of those who died and our admiration for the efforts of everyone concerned in fighting the fire and in the rescue work.
  This is a small Bill with a strictly limited scope but it is a necessary part of our whole programme for improving fire precautions. The Bill will enable local authorities to make loans at their discretion—I emphasise that—to persons who need to incur expenditure on certain specified premises to satisfy the requirements of the fire authority under the Fire Precautions Act 1971. Section 36 of that Act already provides for a loans scheme but it is limited to certain kinds of dwellings which come within Section 3 of the Act.
  This Bill empowers the Secretary of State to extend the loans scheme by order to other kinds of premises which are required to have fire certificates under the Act. The Bill is fulfilling the undertaking given to the House by the Chief Secretary to the Treasury on 10th July last that legislation would be introduced in this Session under which local authorities could act as lenders of last resort for those in a small way of business who, having to incur expenditure on fire precautions, could not find the money from their own resources or could not readily borrow it from other sources such as banks, building societies or similar institutions. We particularly have in mind the proprietors of smaller hotels and boarding houses who, like the owners of larger establishments, were affected by the first designating order made under the 1971 Act.
  I would like to remind the House, and those following our proceedings outside,
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  of the background to this Bill. The purpose of the 1971 Act is to strengthen and rationalise the law relating to means of escape and related fire precautions in a wide range of premises, including places of public entertainment and resort, and certain kinds of residential premises, including hotels. The overriding consideration must be the safety of the public, and the Act is designed to ensure so far as we can that in the event of a fire everyone present will be able to escape even before the arrival of the fire brigade.
  I am certain that no one doubts the need to ensure that premises where the public may be present in any numbers are provided with these essential fire precautions. We are implementing the Act by stages and dealing first with premises offering the highest risks. On the advice of the Central Fire Brigades Advisory Councils for England and Wales and for Scotland the Act has first been applied to hotels and boarding houses.
  This decision was taken against the background of a series of tragic fires in hotels, and the considered view of those with special knowledge of the problems was that it was urgently necessary to bring the standard of fire precautions in many hotels and boarding houses to a minimum acceptable level. An order applying the Act to all but the smallest of these premises was brought into effect on 1st June last, and at the same time we published a non-statutory guide explaining the principles on which the Act would be applied. The immediate practical effect was to require the owners or occupiers of these hotels and boarding houses to apply to the local fire authority for a fire certificate.
  Having done so, the proprietor can continue his business until the application is settled. In due course the fire authority has to inspect the individual premises, and if it is satisfied that means of escape and other related precautions are such as may be reasonably required—and that is an important phrase in ensuring the fair application of the Act—the authority must issue a fire certificate. If it is not satisfied it serves notice on the proprietor informing him of what he

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  has to do before the certificate can be issued.
  Naturally, any necessary improvements required by the fire authority will cost money. It is a long standing principle that where members of the public are invited into premises in connection with a commercial undertaking it is for that undertaking to meet the cost of any statutory measures designed to ensure the safety and health of the members of the public there. It is the fact of this expenditure which understandably gave rise to so much concern last year, particularly to the owners of smaller hotels and boarding houses.
  Even so, there may have been a considerable misunderstanding. To get rid of any remaining misunderstanding, let me make it clear that the fire authority may require only what is reasonable in the circumstances of each case. Safety must be the main consideration, but there is no question of the guide I have mentioned being applied rigidly regardless of individual circumstances. The requirements in the fire certificate have to be designed for the premises concerned, and there are ample rights of appeal to the courts against the fire authority's requirements. The fire service is well aware of the need to take all circumstances into account including financial circumstances, and I want to dispel any notion, if such remains, that its approach will be rigid and inflexible.
  In view of the concern we arranged for special guidance to be issued from the Home Office to all fire authorities encouraging them to hold conferences locally and to explain and discuss the way in which the Act would be applied. Whenever possible, I have talked to chief fire officers with the same object in view. Recently I took two opportunities to visit boarding houses and hotels in Blackpool and Brighton to see how the requirements are being met in the various types of premises. As a result of all this I am satisfied that there is a much clearer understanding of the position. The good response which we have had from proprietors of hotels and boarding houses owes a lot to the efforts which the fire authorities have made in explaining the arrangements. It will take time to complete all the inspections and certifications,
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  but the fire authorities are concentrating on the highest risk premises.
  A point which I stress particularly for many of my hon. Friends is that as we are dealing with a predominantly holiday industry the fire authorities want to phase their programme so that any work will fall to be done out of the season, where this is possible without undue risk to the public. For many of the proprietors of the smaller premises the chances are that it will be some time before they are faced with any expense.
  We have to keep in view the primary need to ensure the safety of the public, and I am, therefore, anxious that the present programme should be completed as soon as possible. We do not have precise figures to give us an arithmetical idea of progress, but all the indications we have show that the fire authorities have made an encouraging start.
  However, given this reasonable approach, we still realise that some owners of smaller premises may not have had time to plan for the extra expenditure which they may be faced, and that is why we decided that we must make some provision for the special cases. The Bill enables local authorities to make loans towards the cost of fire precautions in certain specified premises; that is, premises described in any order made under the Bill. The primary intention of the scheme is to help those owners of the smaller hotels and boarding houses who cannot meet the cost of the necessary fire precautions from their own resources or cannot easily get loans from the customary sources, but the scheme can later be extended, if we think it justified, to other types of premises. Before it is extended to any other premises, voluntary organisations engaged in social work or whatever it might be, there would again have to be first a designating order under the main Act and we should then have to consider on its merits an extension of the loan scheme to these new premises.
  Turning to the Bill in more detail, Clause 1 contains the main provisions relating to the loans scheme. Subsection (1) limits the application to persons who need to incur expenditure on premises for which a fire certificate has been applied for or is already held under the provisions of Section 1 of the main Act, and these premises have to be described

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  in an order made under the Bill. In other words, the premises must first have been subject to a designation order under the main Act and a fire certificate must already have been obtained or applied for.
  At present, only hotels and boarding houses have been designated under the 1971 Act, and the loan applied for must be to meet the cost of the requirements of the fire authority as detailed in the notice which has to be served on the occupier under Section 5 of the 1971 Act; that is to say, the work that must be done before a fire certificate can be issued. The new loans scheme will also apply in cases where the fire authority requires work to be done on premises that are already covered by a fire certificate to bring them into conformity with any regulations made by the Secretary of State under Section 12 of the main Act.
  Subsection (2) empowers the local authority to make loans at its discretion in accordance with the provisions of subsections (2) to (9) of Section 36 of the 1971 Act, with the exception that the local authority must charge a rate of interest ¼ per cent. above the Public Works Loan Board rate provided for under Section 36.
  To clear up that rather complicated point, Section 36 of the Act is not yet in force, because it relates to loans covered by Section 3 of the Act which also is not yet in force. We have so drafted subsection (2) of the Bill as to make it possible for the provisions of subsections (2) to (9) of Section 36 to apply to loans under this Bill even though Section 36 is not yet in force. It is much simpler than I have made it sound.
  There are precedents for the special provision in this part of the Bill for a local authority to charge a rate of interest ¼per cent. above the PWLB rate. The precedents are the Small Dwellings Acts of 1899 to 1923 and the Local Authorities (Land) Act of 1963. This provision was included after consultation with the local authority associations, whose view was that the scheme would involve local authorities not only in additional work but also in dealing with commercial undertakings rather than housing to which they have been more accustomed. This would mean establishing different
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  criteria for judging the merits of applications for loans under the Bill.
  Subsection (3) empowers the Secretary of State, for the purposes of an order under the Bill, to describe premises by reference to rateable value, the purpose for which they are used, the number of persons accommodated, their size, or whatever it may be. That is not an exhaustive list. It is intended to provide as flexible a basis as possible—and that is how we have designed the whole Bill—for tailoring the loans scheme to particular needs. We intend that the scheme should be limited to persons in a small way of business and to those who are responsible for small non-profit-making enterprises. That has been our intention from the start, and it is the intention in the Bill.
  Mr. A. P. Costain: Small boarding houses are often on leaseholds. Could my hon. Friend say what will be the situation in regard to loans to leaseholders operating on a short lease?
  Mr. Lane: Subject to checking on the point, I think that proprietors can apply for loans if they are entitled to them. I will make doubly sure of that point and try to give the information to the House, if I am permitted to reply to the debate.
  Mr. Robert Adley: My hon. Friend has referred to non-profit-making premises. Presumably he is referring not to premises which may no longer make a profit as a result of the fire precautions legislation but premises which do not intend to make a profit.
  Mr. Lane: I am referring to premises which are not covered by the Bill but which may be covered as the provisions are extended at a later stage. We are trying to define the premises not only in physical terms but also in terms of the applicant's personal circumstances. We took the view that it was better to leave it to local authorities to decide on the eligibility of a particular applicant for a loan, subject to the administrative guidance which we shall be circulating from the Home Office. In practice, the local authority will have to be satisfied that the premises for which an applicant seeks a loan comes within the terms of the order, and the order will deal with such matters as the size of premises and the

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  purpose for which they are used. A local authority also must satisfy itself about the credit-worthiness of an applicant.
  Among the administrative points which I envisage our guidance to local authorities will include is advice to the effect that applications should be considered only from somebody in a small way of business—not, for example, from the manager of a small establishment which may be part of a far larger one. I underline the fact that any order made under the subsection will be subject to a negative resolution in either House and may subsequently be varied or revoked.
  I should like to say a word about subsection (5) of Clause 1. This provision is included in the Bill in case at some future date a small charitable organisation which may be brought within the provisions of the 1971 Act should merit help. The subsection provides that Section 29 of the Charities Act 1960 shall not apply and will enable a charity to mortgage its property for the purposes of a loan under the scheme without having to seek express consent of the Charity Commissioners. The commissioners requested that some such provision should be included in the Bill.
  I have already explained that we have been able to consult the local authority associations and the Greater London Council in preparing the Bill. The Association of Municipal Corporations has expressed some reservations and is concerned about the additional burden which the Bill could place on local authorities. It is impossible to estimate accurately the extent to which the new loans scheme is likely to be used, but, given that it will be some time before fire authorities will be able to complete the present programme, and also given the fact that premises must be dealt with on an individual basis, I should be surprised if the local authorities, which will he consulted in advance by the fire authorities, found themselves immediately overwhelmed with applications for loans. I should also imagine that where hotels and hoarding houses are a major activity in a particular area the local authority concerned might see advantages in any scheme, however limited, designed to help those concerned. Nevertheless, if there should be any unforeseen difficulties experienced by local authorities, I can
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  assure them that we shall do our best to help. After all, it is on them that we depend for the success of the scheme. We want to co-operate with them to the full, and we shall be grateful for their help.
  This is a modest Bill, but it is important if we are to ensure steady progress in carrying out the Fire Precautions Act. Therefore, I commend it to the House, and, if it makes good progress, I expect that the first order relating to small hotels and boarding houses will be laid before the House and brought into force during the coming summer.
  10.30 p.m.
  Mr. John Fraser: I begin by associating the Opposition with the sympathy expressed by the Under-Secretary for the relatives and victims of the tragic fire at the Imperial Hotel, Exmouth, and the hon. Gentleman's further tribute to the gallant action of the fire brigade there.
  I was glad that the hon. Gentleman said that the fire brigades would always have to be reasonable about their requirements, and I hope that no hotel or boarding house proprietor will he frightened at the cost of implementing the Fire Precautions Act and that people will not be deterred from applying for fire certificates for their premises because of any unwarrantable fear about the cost.
  When the Fire Precautions Bill was presented in 1970, my hon. Friend the Member for Leeds, South (Mr. Merlyn Rees) promised it a speedy passage and assistance from the Opposition. I can make the same promise in respect of this Bill, which provides for resources to finance fire precautions by enabling local authorities to lend money to owners at the rates of interest which the hon. Gentleman mentioned. The loans will be available to all classes of dwellings which may be affected by the Fire Precautions Act when it is applied to different classes. There is the subsection about charities. That apart, that is about all that the Bill says.
  I hope that we shall be told what rateable bands the Bill will be applied to in the early stages, the type of building to which it will be applied initially—whether, for example, it will be a small boarding house—and whether items of equipment like smoke and fire detectors

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  will qualify for loan facilities. Many commentators, especially in the technical Press, have pointed out that the Home Office guide to precautions does not mention smoke or fire detection equipment at all, and many commentators feel that this is the most useful fire precautions equipment to have in a boarding house or hotel and, therefore, that it should qualify for a loan under the Bill.
  The reasons why the Bill has been produced are well known. On 1st June 1972 the Fire Precautions Act was applied to every hotel, guest house and boarding house which slept more than six persons, including staff, and it caused near panic among thousands of small establishment owners, who feared the cost which would be imposed on them. At the same time, deficiences in fire precautions became increasingly apparent. We have also the problem of what might be called the "creeping" hotel; that is, the establishment without planning permission for use as a hotel. We have problems of businesses which have never been rated as hotels. No doubt we have the problem of the small hotel proprietor who has never declared his income for tax, and there is apprehension felt by that kind of proprietor about making application for a fire certificate.
  At the same time, we have had too many tragic and cruel reminders of the need for adequate fire precautions. Only a few days before the Act was applied to hotels there was the tragic fire at the Ambassador Hotel in Bayswater. More recently there has been the deadly outbreak in the Imperial Hotel, Exmouth. That hotel was well equipped with detector equipment. There are two lessons that one can learn from that. The first is that no amount of equipment can ever supplant the need for care and vigilance in guarding against fire. The second is that the tragedy would have been much worse if equipment to detect and prevent fire had not already been installed in the hotel. In addition, there have been tragic fires in factories and mental hospitals, all of which have brought the matter to the public eye. In the light of these events there has been concern about the cost of implementing the Act, and the Government have acted.
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  There is some apprehension among hotel proprietors about the cost not only of this Act but of value added tax, rates, and the increased prices of food. I think there should be a co-ordinated view about the future of the hotel industry, but that is not a matter for debate tonight.
  I turn now to what the Bill does not state and that which the Explanatory Memorandum omits but which is germane to the purposes of the Bill.
  How widely and quickly is the 1971 Act to be implemented and what are the resources for doing so? I believe that there is cause for a good deal of anxiety about fire risks and the Government's strategy for dealing with them.
  I will mention some of the anxieties. First, we all know that the fire hazard remains very great. The latest figures for 1972 show that there were over 650 deaths, 3,900 people injured, 227 firemen seriously injured, two firemen dead and over £130 million of fire damage. Therefore, fire remains the great destroyer.
  Secondly, on what one might call the non-implementation of the Fire Precautions Act, one estimate that I have seen is that about 250,000 hotels, boarding houses, and so on, are already affected by the Act. Therefore, one is bound to ask what strategy the Government have for dealing with all these premises.
  In December 1972 more than half of these premises—about 125,000 establishments—had not even bothered to apply for fire certificates. In June 1972 16,000 establishments in the counties of Devon and Cornwall had not made applications. I checked the figures for the London area today, and found that 50 per cent. of eligible premises, about 2,000, have not made application. Some of these places will be absolute death traps, particularly those in the seedier London areas. London Fire Brigade spokesmen have already said that they are seriously concerned.
  Thirdly, the time element. Most commentators on the Fire Precautions Act say that it will be between five and 10 years before applications under the Act can be dealt with. The Fire Precautions Act 1971 was first contemplated and planned in 1964, so there will be a great time lag before it is implemented.

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  Finally, there is concern about the Government's assessment. During the proceedings in Committee on the 1971 Bill the then Minister of State said:
  "the numbers of owners…who are unable to finance simple fire precautions from their own resources will be very few."—[OFFICIAL REPORT, Standing Committee A; 15th December, 1970, c. 161.]
  If that were so we would not have this Bill tonight.
  I conclude with some suggestions and questions. First, what estimate can we now be given of the number of establishments which have not applied for fire certificates? The information ought to be available. I speak with some knowledge, because my father was a station officer for many years. Most station officers know their ground, as they call it, extremely well. They know where the hotels and boarding houses are and can probably make a fairly accurate assessment of how many establishments have not bothered to apply for certificates.
  Secondly, how quickly will.411 applications be dealt with? In my opinion, six to 10 years seems more appropriate for an application in the old High Court of Chancery under the reign of Lord Eldon than for a matter involving life and death. I understand that there have been only seven certificates in draft in the Greater London Council area. That is obviously far too slow a pace to deal with the applications.
  Thirdly, I welcome the guidance which has been given that fire officers should deal with premises which have the greatest risk. Will that guidance be extended to premises which have not yet made applications for certificates? Again, many station officers will know those premises which are at risk and have not made application. I hope that they will be advised to take the initiative, even though the proprietor has not made an application.
  Fourthly, will consideration be given to the suggestion put to me that owners might submit plans for fire precautions for their premises without having to wait for an inspection by the fire brigade or the architect's department? When a new building is to be constructed or where a building is to be converted the surveyor or architect will draw up plans for fire precautions and those plans will be approved by the local authority. This takes
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  a lot of work off the local authority. It enables the owner to take the initiative. Somebody selling a hotel or boarding house may then be able to assure a prospective purchaser that plans have been put in and approved and the premises are up to standard.
  Finally, what changes are proposed in the use of the fire brigade manpower so that it is used more productively and so that fire precaution is a major part of the fireman's task? I have visited fire stations for many years and I have seen firemen spending far too much of their time cleaning brass, windows, fire engines, hoses and floors and doing many other household tasks whilst on duty in the station. We must use firemen more productively on fire prevention duties—for example, the inspection of premises.
  I understand that discussions are under way at present to use the fire service manpower more productively. Can the Under-Secretary of State tell us how far the discussions have gone, and whether we shall be able to use a lot more manpower, especially now that firemen are equipped with bleepers and other means of communication, on the inspection of premises?
  If we are to make any useful judgment on the scope and effect of the Bill and the scope and effect of the 1971 Act, that question must be answered to the satisfaction of the house and the public who remain at risk.
  10.42 p.m.
  Mr. Martin Maddan: I welcome the Bill, and I agree with what the hon. Member for Norwood (Mr. John Fraser) has said about the need for the public to receive the protection which is implied in the 1971 Act, which the Bill helps to implement. The hon. Gentleman pointed out that the 1971 Act was first mooted in 1964 and did not reach the Statute Book until 1971. As six of the intervening years were years when the hon. Gentleman's party was in office, I thought he might have given us a little explanation of the difficulties or the reasons for the delay, but he has kept them veiled.
  Mr. John Fraser: I did not want to waste the time of the House. The reasons are set out at great length in the Second Reading debate on the 1971 Act.
  Mr. Maddan: I have not re-read that tonight. However, the fact remains that six years passed. If it was an urgent matter I am certain that it could have been dealt with during that time.
  I received by chance a letter from one of my constituents on Friday last. I shall read a few sentences from it because it underlines the wisdom of my hon. Friend in bringing forward this measure. It is a letter not from a hotelier or boarding house keeper but from a member of the general public. It says:
  "Would it be possible for you to look into the position regarding fires in hotels…"
  Later it says:
  "…s commonsense would surely suggest that serious consideration be given to compulsory provision of fire escapes. It is small inefficient establishments that are presumably unable to bear the cost of such facilities that the fire risk is greatest."
  I question what the writer says about inefficiency, but what is said about "small" is true. The letter concludes:
  "I realise that it may be that the present machinery is adequate, but it does appear that some pressure in the appropriate quarters would greatly reduce the risk even if some expenditure is necessary."
  That constituent will be delighted that the Bill, in contrast to what happened when the hon. Gentleman's party was in office, has been brought forward in four days in response to his plea. But seriously, we know that my hon. Friend has devoted a lot of attention to this difficult matter over recent months.
  I am still concerned about the discretionary element in the local authority's power to make a grant. The 1971 Act makes it clear that the local authority must satisfy itself that the person receiving the grant is credit-worthy. My hon. Friend said that he wanted to see that bodies that were parts of large commercial enterprises and could afford the money did not take advantage of the scheme. Yet he wants to charge ¼ per cent. above the Public Works Loan Board rate. I do not understand how he balances these things. With all the conditions which will go with the local authority loan, that does not seem a very attractive rate.
  If I am right, those who apply for a grant should do so in the knowledge that, if they are credit-worthy they will get it. If my hon. Friend does not think that
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  that is a good line of argument, at least we should consider at a later stage writing into the Bill that an applicant, if refused, can appeal to the Secretary of State, who can, if he thinks fit, order the local authority to give the grant. There is a wide fear—I understand the reason for this—that some local authorities may refuse grants and put certain hotels or boarding houses out of business. There should be a reserve protection.
  My final point I touched on when I talked about the cost of loans. Will it be permissible, in the present period of freeze, to charge more per room per night for premises that have been made safe than was charged when they were unsafe? If not, and the interest charge nevertheless has to be borne, that will be equivalent to putting many hoteliers or boarding house keepers out of business.
  So, although I welcome the Bill and the speed with which, since last summer, when this matter came to a head, my hon. Friend has acted, there are those points which will need further attention. No doubt in Committee we shall return to them.
  10.48 p.m.
  Mr. John Pardoe: I should like to associate myself with the remarks from the two Front Benches about those who suffered bereavement in the fire at Exmouth. This has emphasised, as do all hotel fires, the tremendous and urgent need for these fire precautions.
  However, if the hon. Member for Hove (Mr. Maddan) thinks that this Bill will get any fire precautions made, will get any fire escapes built, he is living in cloud-cuckoo-land. It is essential to get the Fire Precautions Act implemented as quickly and as painlessly as possible. This is what the Government are refusing to do, and have refused to do ever since the Act was passed.
  When trying to reply to the question "How soon will it all be done?" the Minister says "As soon as possible". I must ask the same question as the hon. Member for Norwood (Mr. John Fraser)—when is "as soon as possible"? Speed is of the essence. At no time have the Government brought forward specific rewards for quick action. There is undoubtedly a great temptation, which all of us representing seaside constituencies

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  realise only too well, to put off the evil day as long as possible.
  The history of the Bill is fairly simple. The Fire Precautions Act was passed but, unfortunately, in a kind of economic vacuum. No one really thought about how the costs would be borne. They were presumed to be somehow spirited out of thin air. Then we came to the debate on the Finance Bill on 10th July 1972. The Chief Secretary to the Treasury was then in a quandary. We had a great debate, and he had had many requests from his side of the House for some concession. He got to the end of his speech and realised that he was running out of time and desperately needed something to produce, like a white rabbit out of a hat. We did not get a white rabbit. We got a mouse. When he produced it many of his hon. Friends said what a marvellous measure it was and what a tremendous benefit it would be to the hotel industry. They are not feeling quite so optimistic now.
  The Minister seems to have described the Bill this evening with a large number of diminishing comments, such as, "a modest Bill", "a small Bill". He also said that it was unlikely that local authorities would be overwhelmed by requests for loans. He can say that again.
  On 10th July 1972 the Chief Secretary to the Treasury said:
  "Nevertheless, I go on to make it clear that I recognise that there is a problem which has to be met. It is a problem mainly affecting small hotels and business houses, and a number of my hon. Friends have emphasised that this afternoon."
  He went on to say:
  "What seems to me to be necessary is to provide such people with access to loan finance so that they can have the work carried out as and when required by the fire authorities."—[OFFICIAL REPORT, 10th July, Vol. 840, c. 1262–63.]
  The Chief Secretary then announced this particular scheme, which was effusively welcomed on the benches behind him, in spite of the advice from the industry, both small and large hotels alike, and all the organisations representing the industry, that what they wanted was not loans or grants but tax concessions and that this would have been perfectly sufficient to do the job.
  The Minister was right to say that it is unlikely that local authorities would
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  receive a very large number of requests for this money. Who will apply? In a letter to me on 19th July the Minister said:
  "This help is primarily intended for those who cannot meet the cost of fire precautions from their own resources and who have been unable to obtain help from banks, building societies or similar institutions."
  On 19th July the Chief Secretary to the Treasury also said to me:
  "I am bound to say I disagree with the suggestion in your second paragraph that the loan provision will be virtually useless. I made it clear to the House that the scheme would enable local authorities to act as lender of last resort for a small hotel or boarding house keeper who found it difficult to borrow the money he needed from other sources."
  I am still unable to find the exact section of the industry which will have to depend on this measure. The number of establishments which will use this facility will be very small indeed, not only small establishments but small in number.
  Mr. Adley: Has the hon. Gentleman consulted the British Hotels, Restaurants and Caterers Association about the Bill?
  Mr. Pardoe: Yes, and my local organisation, the Newquay Hotel and Caterers Association. Newquay has a very large number of these hotels and guest houses which it is the aim of the Bill to help. But it is almost impossible to find people who are likely to be helped by it. After all, there are already lenders of last resort. The Council for Small Industries in Rural Areas is a lender of last resort and able to lend for this purpose if necessary.
  It is not the lack of credit. That is the extraordinary thing. The Government must get it into their heads that what is stopping progress on fire precautions is the cost of credit.
  So what could have been done? I believe that the most obvious way to get the thing going fast was to amend and extent—
  Sir Hamar Nicholls: The hon. Gentleman mentioned the Council for Small Industries in Rural Areas as one source from which money could be obtained. What rate of interest would it charge, compared with that in the Bill?
  Mr. Pardoe: It charges a similar rate of interest—¼ per cent. above the public loan rate. I am fairly sure that that is

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  the rate, but the hon. Gentleman can check it.
  The easiest thing that the Government could have done was to extend temporarily the Development of Tourism Act to enable the tourist board to make grants towards the cost of fire precautions. I should have limited that to, say, work begun by April 1974, or perhaps to work completed by April 1975, and I should have made it clear that there would be no grants for fire precaution purposes beyond those dates. That would have caused hoteliers to rush their plans forward.
  Secondly, the Government should have announced that all expenditure on fire precautions was tax-deductible. It is extraordinary, as we said during the debate on 10th July, that so far that has not been done by any Government. Thirdly, and much more importantly, all hotels ought to count for depreciation for tax purposes. The only thing that the Government are able to say when we argue this is that sane men cannot tell the difference between hotels and office blocks. The Government act in strange ways. A Government who cannot tell the difference between an hotel and an office block are suffering from a curious kind of visual disease.
  The Minister is right to describe this as a modest Bill, as a very small Bill. It is a very small Government gimmick. It is totally useless to the industry, and it is a waste of time introducing it into the House.
  10.57 p.m.
  Mr. Michael Shaw: I welcome the Bill. It is a modest measure, but it will bring some help. I do not want to speak for long, but I want to speak about one aspect of the Bill which I hope will receive consideration in Committee.
  I accept that the Bill is aimed primarily at helping the small family business. I accept, too—as indeed was inherent in the 1971 Bill—that there must be considerable cost to many of these small hotels and boarding houses. But, though there may be considerable cost, there is considerable need, and I think that that, too, has to be accepted.
  Listening to my hon. Friend it was not immediately apparent—although it
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  is from a perusal of the Bill—that not only has a certificate to be applied for but that a notice has to be served on the proprietor saying that certain expenditure is required. It is only at that stage, as I understand the Bill, that the proprietor can apply to the local authority for a loan.
  We have heard tonight that no great speed is envisaged in all this. If I heard my hon. Friend aright, it will be some time before proprietors will be called upon to incur this expense. If I may say so in the friendliest possible manner to my hon. Friend, that was not the impression when all this started. There seemed then to be great urgency about this matter. Indeed, the Bill started because of the urgent representations that many of us made to Ministers concerned about the difficulties in which these small businesses would find themselves.
  So we should try, in discussing this Bill, to cast our minds back to its origins and to the urgency which was then apparent, rather than follow the more leisurely approach which seems to have followed.
  I know of cases in my constituency where proprietors acknowledged the need to carry out this work, knew that at a later stage they would have to apply for these certificates, and that sooner or later their premises would be inspected and they might be called upon at any time—they did not know when—to make their premises fit the proper conditions.
  Some of them said that they had been told that this work was necessary and that, if need be, a facility would be given to borrow money from local authorities. They feared that they might be asked to do the necessary work during the holiday season and felt that, having made the application, they should get on with the work, particularly as it became more expensive with every month that passed.
  There is, therefore, strong ground in this case for the Bill to be amended so that local authorities are empowered to make loans to those who have already started or even to those who have completed work before a notice under Section 5 (4) of the 1971 Act has been served on them.
  This was a matter of some urgency in the early stages when people were

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  encouraged to get on with the work as quickly as possible. I know of cases where the people concerned got on with the work and are now in difficulty.
  I know also, because I have examined one case, that these are sound businesses, but that carrying out all the necessary work has been expensive. There have been cases where proprietors have had to make very temporary arrangements for credit to carry out the work and they are now facing the problem of how to rationalise their loan requirements. It would be of great assistance to these people if they knew that they could make an application, when the Bill has gone through, to the local authority for a loan.
  I urge my hon. Friend, in view of the history of the Bill, to look again at the necessity for first having to lodge an application for the certificate and then having to await inspection, which, by everybody's admission, may take a long time. During that time the persons are not getting on with the job and are putting their guests at risk. Facilities should be given to those who have got on with the job, even though it turns out that they have jumped the gun.
  11.4 p.m.
  Dame Irene Ward: I am delighted to participate briefly in this debate. I listened to the charming way in which the Under-Secretary introduced the Bill. He did so as if it were something wonderful which the Government had thought up: something to help small boarding houses and hotels.
  I cannot remember when my hon. Friend became Under-Secretary. I know the present Home Secretary was not there then. It is humorous to hear a Bill with these provisions being brought forward in this way when a large number of us with constituencies containing small hotels and boarding houses went en masse not to the Home Office but to the Treasury. My party has a lot of brains now, and it knows that one cannot have anything, even such a good Bill as this, if one has not got Treasury agreement. We very cleverly decided to descend on the Treasury. The then Treasury Minister, who is very able, attractive and—as a rule—on-coming, did not receive us all that graciously to begin with. However, we had a good go at him and retired.
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  Now my hon. Friend the Under-Secretary introduces the Bill as if it were a wonderful contribution from the Home Office. He might have said how pleased he was that we made that foray on the Treasury and that the Treasury had yielded to us—I wish that the Treasury always had to yield to good ideas—and had allowed the Home Office to introduce this modest Bill. It is a pity the Home Secretary does not admit that this is a modest Bill and say that he will have a go at the Treasury and then introduce a Bill which could not be described as modest.
  Most hon. Members want to help the small hotel or boarding house keeper who wants to earn his living and provide safety for his guests. In the efforts to counter inflation we hear much about the problems of the lower-paid and of the pensioners. I support all efforts to help those people, but I also believe in helping those who want to help themselves. I thought that was Conservative philosophy. It is amusing to learn that something different stems from the Conservative Party.
  I am sure that all the representations will be to the same effect and that the Bill should not be so modest. What fun it will be when the Selection Committee has to put all those hon. Members who speak tonight on to the Standing Committee. I do not see how the Government will get a majority in Standing Committee, because in our constituencies we are keen supporters of the small hotel and boarding house keeper.
  I had hoped and believed that the Home Secretary, to whom I am devoted, thought that I had a brain. However, he has sent me a letter today plastered all over with a great pink label saying "Very important" and "Very urgent". When the attendant came and told me that there was an important letter for me I thought that I would not have my dinner because the letter was so important. But the letter merely tells me that I have not quite as many brains as I had hoped the Home Secretary thought that I had.
  The Government say that they are to help the lower-paid and under-privileged. I had asked in my letter that the local authorities should be told that they must

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  have a loan scheme. The Home Secretary says:
  "This would deny to the local authorities the ordinary discretion which any lender would be expected to exercise, and would put the ratepayers' money at undue risk: difficulties can sometimes arise when a mortgagor fails to meet his repayments even if security for the debt has been taken."
  I knew that myself. I know that I have not much in the way of a financial brain, but even I knew that. So our delightful and co-operative Home Secretary need not really have bothered to tell me it, because even I knew it.
  The whole exercise is really explaining, in advance of the Committee stage, why we who are here tonight saying what we would like for our small hotel and boarding house keepers cannot have it. That is a pity, for we did so well with the Treasury. But my right hon. Friend was not Home Secretary at the time we made the arrangement with the Treasury, so he really did not know; otherwise he would, I am sure, have agreed with my letters and the letters of my hon. Friends explaining how very strongly we feel about this matter.
  It is no use merely saying "We must help the lower-paid." It is a question not only of the low paid but of people who cannot make a very big income from hotel and boarding house keeping because they have not the premises to do so. If, rightly, we are to help the lower-paid, we must also help the people who can make only a little profit, because, thank goodness, we have a lot of very good, hard-working hotel and boarding house keepers who want to make a profit. We think that it is up to us to help them.
  Perhaps my hon. Friend the Under-Secretary of State was not in his present position when we made our great foray to the Treasury. But we think that we should have our way. That would, I am sure, thrill the media and the whole House, and we want such co-operation between Socialists, Liberals and Conservatives. We know exactly what we want, and here is an opportunity for the Government to give it to us.
  I say "Good luck" to the Standing Committee because it will be a wonderful opportunity for the Government, without running great risks of losing elections and so on, to give us what we
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  want. If they do, we shall be able to say to our small hotel and boarding house keepers "We think you are doing a very good job, and all parties in the House of Commons are united in being prepared to help you." My right hon. Friend will do far better if he gives us our way. If he gets into trouble with the Treasury we can all go back to it and say "The House of Commons has asserted its views. and it is up to the Treasury and the Government to let us have our way in the interests of our constituents."
  11.13 p.m.
  Mr. Robert Adley: I congratulate my hon. Friend the Member for Tynemouth (Dame Irene Ward) on saying many of the things which I and many of my hon. Friends would not dare to say. She is right in everything she has said, and all power to her for having the courage to say it. This is what the House of Commons is for, as she has said, and she has been renowned over the years for standing up for her beliefs and for the little people.
  I declare an interest in the hotel industry, although not in any of the premises this Bill is designed to assist. I also confirm once again, although it should not be necessary, that all of us in this House fully support the Fire Precautions Act. There is no question of any one of us thinking that the Act is wrong or should not be implemented. As the hon. Member for Cornwall, North (Mr. Pardoe) has said, we want to see it implemented quickly and effectively and the Government doing all they can to bring that about.
  My hon. Friend the Member for Tyne-mouth has exposed in lurid detail the origin of the Bill. It is not, and was not, initiated by the Home Office.
  One of the problems of the hotel industry is illustrated very well by the Act. It was brought to the House as a Bill by the Home Office; yet tourism is the responsibility of the Department of Trade and Industry. Our representations had to be made to the Treasury during the debates on the Financial Bill last year. This is the nub of the problem. The hon. Member for Norwood (Mr. John Fraser) made a good point when he said that the industry should find a way of making itself heard and of having its problems dealt with by the Government

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  on a co-ordinated basis. Most of us here tonight would entirely agree with him. It is inconceivable to me how over the years the industry has allowed itself to be bullied and pushed about, unrepresented in the House. That has been mainly because of its failure to present a united front.
  I am glad to see that the amalgamation of the Caterers Association and the British Hotels and Restaurant Association into the new BHRCA has changed all that. There is now an effective and powerful voice speaking on behalf of the industry. Although it has made one or two comments on the Bill, I believe it would reject some of the less friendly criticisms by the hon. Member for Cornwall, North. At least perhaps he will join us in starting up a movement which will enable the hotel and catering industry to acquire a voice and a lobby in the House. Tourism, the largest dollar-earning industry in this country, has long been neglected. We spend much time in the House discussing the problems of the coal industry and the steel industry, which appear to have permanent problems. Yet the tourist industry, which is a success story, does not get discussed anything like as much as it should. Parts of the industry, particularly the small hotel keepers, who are its backbone, have until recently not had a voice which could be heard here to speak effectively for it.
  The hon. Member for Cornwall, North referred to the debate on the Finance Bill last year. My hon. Friend the Chief Secretary to the Treasury accused me last year of exaggerating the problems of the small hotel keepers. He said in reply to a Question from me:
  "I have listened carefully to what my hon. Friend has said and have read the letter he wrote earlier this month on the matter. He may be exaggerating the problom."—[OFFICIAL REPORT, 25th April 1972; Vol. 835, c. 1265.]
  I should like to think that as a result of the experience of many of my hon. Friends in recent months it could be seen that we were not exaggerating the problem, either then or now, and I hope that it will be appreciated that a great deal of help is needed by the small hotel keeper. The trouble is that the problem is still unknown. The Fire Precautions Act was introduced by the Home Office without
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  consultation with either the industry or the Department of Trade and Industry. Every hotel and boarding house should have registered under the Act on 1st June 1972, and we now know that a large percentage of them not only had not done so by that date but still have not done so. My hon. Friend the Under-Secretary, in reply to a Question I asked on 7th December 1972 about how many hotels and boarding houses required to register under the Act had done so, simply said that the information was not available.
  Many of us feel that the problems of the industry are still neglected and that the Bill needs a deal of beefing up, and I should like to support proposals put forward by my hon. Friends this evening. It should be mandatory upon local authorities to provide loans for small hotels and boarding houses should they be required. There should be a lower rate of interest than the ¼ per cent. above the Public Works Loan Board rate. I should like to suggest 2 per cent. below that rate. Many of these hotels are in the major towns and cities where there are terraced buildings, places like Bristol and Bath. They are small hotels which would not qualify for the assistance mentioned by the hon. Member for Cornwall, North. Under the legislation such assistance is available only to properties in rural areas.
  Facts about the effectiveness of the Fire Precautions Act are hard to come by. There are too few fire officers, and registration is incomplete. I want to quote four current cases which are causing concern, which illustrate well the problems which small hotel-keepers are facing, and which show that we are not exaggerating. A hotel in Berkshire with 22 rooms has been given 190 days to carry out work costing £12,000 under the Act.
  I must say to the hon. Member for Norwood that I thought his remarks about fire officers interpreting this Act leniently—remarks echoed by the Minister—
  Mr. John Fraser: Reasonably.
  Mr. Adley: Very well. I thought that the remarks showed a total lack of realisation of what is going on in and around the country. If I were a fire officer faced with a piece of legislation produced by the Home Office I would rightly consider it my duty to implement it to the

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  letter. I would not like to be held responsible for a fire in my area and subsequently use as my excuse "The Home Office told me I should interpret the law tolerantly." Any fire officer worth his salt will do his job thoroughly. This large sum of money for this hotel will bring in no extra profit.
  As my hon. Friend the Member for Hove (Mr. Maddan) said, the freeze is preventing higher charges being introduced. This is a classic example of a proprietor in real difficulty. In a letter to the Chief Executive of the British Hotels, Restaurants and Caterers Association the proprietor says:
  "The rate of interest is likely to be commercial and the loan will have to be repaid so that the Government aid of this kind that is proposed in the next Session of Parliament is, in my view, unrealistic."
  That is why I and many of my hon. Friends feel it is absolutely necessary for the Government to provide a really attractive and low rate of interest.
  I come to the second case which I mention on behalf of my hon. Friend the Member for Isle of Wight (Mr. Woodnutt), who apologises for being unable to be here tonight. He has asked me to raise this case. It is a typical one of a small hotel run by two partners who are slaving away day and night in the season to try to eke out a meagre living from the hotel into which they have both put their life savings. As a result of the Act and the assessment made by the officer I have a letter here which tells me that one of the partners, in addition to having to work all day in the hotel, is now having to work five nights a week in a factory to make ends meet and somehow scrape together enough money to carry out this work. I do not believe that this case is in any way an exception. The cost to this hotel of £7,000 is the result of the burden imposed on the proprietors by the fire officer carrying out the will of Parliament.
  Case No. three concerns a small hotel in Dorset which has to pay £650 for materials alone. It is a very small property which showed a surplus of only £1,000 at the end of the last trading year. The letter says:
  "The total of £650 is purely for materials. No element of labour is included at all. According to our accounts for last year we
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  had approximately £1,000 left after running expenses, to be divided between us as our wages and to meet any improvements. I think you will see that an outlay of £650, which will in no way improve our profit performance without sizeable price increases, will result in some difficulty. At the same time we are having to improve standards as the public demands change."
  That is not an untypical case.
  Case No. four is a small hotel in Christchurch, Hampshire. The proprietor tells me:
  "under the new Act I am being forced to spend what I estimate may cost me between £500 and £700."
  This letter is dated within the last few days. It goes on to say of the freeze:
  "With the freeze as it is at the moment I read that I shall not be allowed to put my prices up to cover either this or the increased cost of food, facilities, rates, etc. This will personally hit me very hard. I am also affected by VAT which in my case is discriminatory as most of my opposition are cheap rate bed and breakfast amateurs who unfortunately appeal to the majority when money is scarce."
  This is the problem of the small man trying to run a legitimate business which is his only source of livelihood.
  Mr. Michael Shaw: Can my hon. Friend tell me whether in these cases any of the money has already been spent, because this Bill applies only to those who are still intending to spend, not to those who have started to spend?
  Mr. Adley: He has not so far had to spend the money, although he was originally told in 1969 a different story from the one he is now being told. There has been a continuing change in legislation and he has not yet had to expend any of this money.
  Those are just four examples. The need is real for assistance for these people, and the rate of interest is vital. I am sure my hon. Friend the Under-Secretary of State will agree that it is absolutely crazy to put a financial penalty on safety. That is what motivates us all in our request for the lowest possible rate of interest. We are interested in having the work done without making it financially prohibitive to the owners of the premises.
  The chief executive of the British Hotels, Restaurants and Caterers Association writes as follows:
  "Clause 1(2) of the Bill provides that any loan made shall bear interest at a rate

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  higher by one-quarter per cent. than the rate provided for under Section 36(4) and (5) of the Fire Precautions Act 1971. At a meeting of our National Council yesterday this provision was the subject of considerable concern as it was felt that the whole object of the exercise could be jeopardised, at least so far as hotels are concerned, if the rate of interest was higher than that normally payable in respect of local loans. In fact, the view was expressed that loans for this very special purpose should be at a rate of interest lower than the rate normally charged. If you can help on this we shall be most grateful."
  My hon. Friend said that he had discussions with the Association of Municipal Corporations, the fire officers and the local authorities. What discussions has he had with the British Hotels, Restaurants and Caterers Association, which is the main representative body of the hotel and catering industry? Secondly, will the work he has mentioned be authorised by the county authority or the new district authority?
  After all that, I end by thanking my hon. Friend for his continuing concern and assistance. I apologise for being a bit mean and tough, and for badgering him. I pay a personal tribute to him for the trouble he takes to understand an industry for which his Department is not responsible. I thank him for his courtesy and assistance, and I hope that in Committee the arguments we have put forward will be persuasive, not just by numbers but by their common sense.
  11.27 p.m.
  Sir Anthony Meyer: I support everything that has been said by my hon. Friend the Member for Bristol, North-East (Mr. Adley), who has played a key part in getting this less-than-fully-satisfactory measure. I am reluctant to look a gift horse in the mouth, even if it is a broken-winded, three-legged, walleyed nag with no teeth.
  I pay tribute to my hon. Friend the Under-Secretary of State, who has been most helpful and courteous and has gone out of his way to help us. This is a Treasury Bill, and it was to the Treasury that we made most of our representations. The Bill reflects our relative success in getting our point of view across to the Treasury.
  None of us would for a moment dispute the necessity for the Fire Precautions Act. What has emerged from the debate is the feeling that, on the contrary, the Act should be applied with more speed
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  and vigour. What has also emerged is that the impact of the Act on hotels should have been part of a coherent policy directed towards the promotion of the tourist and hotel industry. Such a coherent policy is sadly lacking, and we shall pay for it, because the day of reckoning that is coming when the Act is fully applied will have terrible consequences for a large number of small hotel keepers. We do not want the day of reckoning to be put off. We want it to be advanced so that there may be no risk of life-losing fires occurring. Therefore, it is necessary that there should be a coherent policy of support for the hotel industry. I am bound to say that the present measure is a less than satisfactory part of any such policy.
  In regard to the figure of ¼ per cent about the Public Works Loan Board rate, I agree that there should be an element of subsidy, although I feel that the sooner we get on to a system of tax allowances to meet costs the better.
  The only really fresh point in this discussion relates to the discretion of local authorities to make loans. What is likely to occur under the local government reorganisation proposals is that in the new areas where tourism bulks large tourist industry representation may well be very much less than representation on other matters. Such local authorities may feel under much less obligation to make the loans which are provided for in this measure than do existing local authorities which fully reflect the needs and anxieties of the tourist industry. I hope that the Bill will be amended in Committee to make this activity mandatory rather than discretionary.
  11.30 p.m.
  Mr. Ian Percival: In a brief speech I wish only to emphasise the feelings of dissatisfaction expressed by many of my hon. Friends in this debate. None of us wants to be ungracious or to look a gift horse in the mouth, but I hope that this debate will have made it clear to Ministers, whether they be in the Treasury or in the Home Office, that, while we are glad that the Government are doing something to facilitate the speedier implementation of these important provisions, we hope—and indeed expect—to see improvements at the next stage of the Bill.
  I wish to mention two matters. One relates to the observation made by my

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  hon. Friend the Member for Tynemouth (Dame Irene Ward) that in this Bill we are dealing with people who are in a small way of business, who are working for themselves and supporting themselves and who, by their own efforts, are making a real contribution to the life of towns whose inhabitants most of us taking part in this debate represent. I hope that that alone will be considered to be a good reason for giving them rather special consideration.
  It must be said that the group of people with whom we are dealing in this debate have been left out of account compared with the treatment which has been afforded to many other groups in the amount of attention which they receive from the House and from the Government. Many of us who represent these people feel that they have been left fairly far behind in the thinking and actions of successive Governments.
  I wish to mention the point raised by my hon. Friend the Member for Scarborough and Whitby (Mr. Michael Shaw). The Bill as it stands could assist only those who have not yet spent any money. A person may already have expended money and may find himself in even more difficulty than a person to whom the Bill in its present terms applies. If such a person has had to raise money quickly, he may find himself paying a very high rate of interest. It could not in any sense be described as fair if he were left to go on paying a higher rate simply because he had been obliged to and had carried out work at an earlier date, whereas if he had not been obliged to and had not carried it out until after the Bill came into force, he would be assisted and would be called upon to pay a lower rate.
  While expressing those views, I end as I began by endorsing in general terms what my hon. Friends have said. I hope that we have all made it clear that we mean it when we say that we are glad that our Government are taking this action, but we hope that they will not spoil it by being niggardly about it, and that they will do what is necessary to ensure that this step will be useful.
  11.36 p.m.
  Mr. Wyn Roberts: I echo my hon. Friend's commendations of the Minister and express the hope that we
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  shall see some improvements in the Bill as it goes through the House.
  The Minister referred to similar loans for housing. That legislation authorises loans at a rate of up to ¼ per cent. above the Consolidated Loan Fund or other borrowing rate as opposed to the proposal in the Bill of a fixed and immutable rate of ¼ per cent. over the Public Works Loan Board rate. The Government must justify rather more than so far the fixing of the rate in this instance while allowing discretion in the other instance.
  We are all anxious that hoteliers and boarding house keepers should proceed as quickly as possible to the implementation of the Fire Precautions Act, but there must be some significant stimulus to them to go ahead with that implementation. I support the plea for cheaper loans on that account.
  I should not go so far as to say that the cheaper loans should be fixed at 2 per cent. less than the rate specified in the Bill, but I urge the Government to consider a provision for loans such as already exists in similar housing legislation.
  The one point which may be urged against the Bill is why the ratepayers of any local authority area should support the hoteliers and boarding house keepers in their midst. The answer is very simple. It is basically that most of these holiday local authority areas rely extensively for their prosperity on the hotel and tourist trade.
  I welcome the Bill. But I ask my hon. Friend to give full consideration to the point that I have made.
  11.40 p.m.
  Mr. A. P. Costain: In an earlier intervention I made a point which I hope that my hon. Friend the Under-Secretary will be able to answer. In a constituency like Folkestone a number of hotels and boarding houses are nearing the end of rather long leases. Some of them have only four or five years to run. I am pressing ground landlords to extend leases of this kind, but I am not sure that it will be possible. I shall do my utmost to persuade them. But in such cases it will be difficult for a local authority to grant loans under the Bill. How can the authority decide

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  whether the security is good enough? If it is decided not to be, what is the unfortunate proprietor to do? Many of them have retired early to go into the hotel business. They want as much as anyone to make their hotels safe. Generally speaking, the hotels are safe, though they may not be up to modern standards.
  My hon. Friend the Member for Tyne-mouth (Dame Irene Ward) referred to the fact that we had made a foray on the Treasury. In fact, it was more like a posse. But, having drawn gunsmoke, only today I have received a letter from my agent saying that this Bill should be got through quickly. I hope that every pressure possible will be brought to bear on the Treasury to get the Bill through quickly.
  11.42 p.m.
  Mr. Lane: With the leave of the House, I wish to reply to some of the points which have been raised in the debate. If I do not cover them all, I can assure hon. Members that all that they have said will be considered carefully before we begin the Committee stage. Many of these points are matters which can be gone into further in Committee, and we all hope that the Bill will emerge from its Committee stage an even better one than it is at present.
  First, let me put one matter straight. Unwittingly, I may have caused some misunderstanding. There is great urgency in carrying out the Fire Precautions Act in the interests of public safety. There is no question of going slow on it. The purpose of this Bill is to keep up the momentum that we all want to see by removing possible financial obstacles. When I said that I did not expect that authorities would be flooded with applications, I meant that we envisaged the Bill being applied with urgency but also steadily in other words, not all at once and in a rush in every individual locality. As this is only a means of lending of last resort and we expect in most cases any necessary loans will be readily available from banks, I should be surprised if the local authorities were flooded with applications all at once in any area. But it is very important to get on with this work urgently.
  Mr. Adley: But small hoteliers find the greatest difficulty in borrowing money from banks. This is one of the reasons why we started all this.
  Mr. Lane: I am aware of that. We envisage a varied apparatus of lending money of which this local authority provision may be a very important part for the smaller people about whom my hon. Friends are concerned.
  I come, then, to the point raised by my hon. Friend the Member for Folkestone and Hythe (Mr. Costain) about leaseholders. If my hon. Friend looks at Section 36(3) of the Fire Precautions Act 1971 he will see a definition which means that the local authority has to be satisfield that the person applying for a loan in the premises concerned is either someone owning the freehold or someone who has a lease for a period which must not expire before the final date for repaying the loan. That is the best answer that I can give at the moment, but I hope that it will enable a large number of leaseholders to be covered.
  I am grateful to the hon. Member for Norwood (Mr. John Fraser) for his general welcome to the Bill. He raised many matters, not all of which I can adequately reply to now. One point concerned smoke detectors. We do not expect that smoke detectors can be required directly under the 1971 Act, because their purpose is to protect property, whereas the Act is more concerned with the provision of means of escape. If smoke detectors are installed as an additional safeguard to property it may be that the fire authority could accept a lower standard of certain means of escape requirements under the Act. So there would be a kind of compensating effect to a proprietor who had installed smoke detector equipment.
  The hon. Gentleman's main concern was the speed with which we are getting on with this matter. I accept all that he said about anxieties over the effects of fires. We had the reminder of Exmouth. My London home is in Bayswater, so I am well conscious of this point. Without going much further into detail, I should point out that, according to our information, some of the figures quoted by the hon. Gentleman about the total number of premises involved and the degree to which hotel keepers have not yet applied for certificates were exaggerated. My information is that progress has been good. At one large resort over half the hotels and boarding houses applied for certificates some time ago,

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  and progress is being maintained. It will certainly take a few years to get the Act fully carried through. I do not want to put a precise time on it. My feeling about the situation, having discussed it with fire authorities and visited two or three areas, is that there is plenty of urgency and that those concerned have this point very much in mind.
  The hon. Gentleman asked about the guidance for fire authorities in going to high risk premises which might not yet have applied for certificates and whether they could forestall the applications. All competent fire authorities know where their high risk premises are situated, and they will not wait for an application for a certificate.
  The last point which I should like to try to meet directly related to using fire brigade manpower more productively. This is being done throughout the fire service. There is a move away from using firemen for duties which can be carried out by unskilled staff, particularly since the Cunningham Report. A special committee of the advisory council is at present considering ways of providing for the better use of operational firemen's time in all respects. Again, if I may amplify this point from my experience of visits to different areas, the fire authorities are certainly redeploying their manpower to apply this Act as urgently as they possibly can, given their present establishments.
  My hon. Friend the Member for Hove (Mr. Maddan) referred to two or three points. One concerned the discretion of local authorities. We can no doubt go into this matter in Committee. We believe that there would be very strong resistance by local authorities to any proposal that they should be compelled to make loans to anybody who applied for them. I am not aware of any public body that is required by statute to provide loans to the public as of right without regard to various circumstances, such as creditworthiness or the merits of the scheme for which the loan is required. If we were to compel local authorities to provide loans in the way that some hon. Members seem to want, we should be putting the ratepayers' money at risk, because difficulties can obviously arise if a mort-
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  gagor fails to meet his repayments, even if security for the debt has been taken. I cannot see why we should be more generous to commercial enterprise in this Bill than the House wanted to be to the owners of dwellings covered by Section 36 of the main 1971 Act. This is on a discretionary basis——
  Mr. Adley Mr. Adley rose——
  Mr. Lane: I suspect there is not much between us in practice. Possibly my hon. Friend is reading too much into "discretion". I have no doubt that there will be no serious difficulties given the clear will of the House that local authorities should help in that way. I do not see serious difficulties by local authorities hanging back.
  Mr. Adley: Regarding failure to repay loans, I do not think that any hon. Member has suggested that the two points raised in Section 36(2)(a) and (b) should be waived, so that point is not germane to the argument.
  Mr. Lane: We will go into that further in Committee.
  My hon. Friend and other hon. Members raised the matter of whether prices could be put up during phase 2 or phase 3 or whenever. That is something which I should not like to answer off the cuff. I will consult my right hon. and learned Friend the Minister for Trade and Consumer Affairs. No doubt we will discuss the matter further at a later stage. I realise how important it is to a number of businesses concerned.
  May I say to the hon. Member for Cornwall, North (Mr. Pardoe), who brushed the Bill rather contemptuously aside, that I described the Bill as modest because I want to put it in perspective. It will have an important part in maintaining the progress which we all want to see in getting the main Act implemented. I reject the suggestion that it is either a useless gimmick or a waste of time.
  My hon. Friend the Member for Scarborough and Whitby (Mr. Michael Shaw) raised a matter of understandable concern; namely, the uncertainty of businesses which have already started work in anticipation of being required to do it. My hon. Friend wanted to know how

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  they will stand under the scheme. We have that problem in introducing any new scheme of this kind in any area of national life. There are always transitional situations. However, we would like to look further into the matter. Undoubtedly, we shall have an opportunity to explore it in Committee.
  My hon. Friend the Member for Tyne-mouth (Dame Irene Ward) was a little unkind. She accused my Department of taking all the credit for the Bill. Far be it from that. I remind my hon. Friend that I said in my first speech that a decision was arrived at among the Departments concerned—the Department of Trade and Industry, the Home Office and the Treasury. It was announced by my hon. Friend the Chief Secretary to the Treasury in July. We are doing in the Bill precisely what my hon. Friend said the Government would do. That is the position, neither more nor less. There is no discrepancy or lack of cohesion between the Home Office, the Treasury and the Department of Trade and Industry. It is the purpose of the Bill to help people in a small way of business. If we find that we can, within the limit which we have set, improve the Bill from that point of view in Committee, we shall seriously consider doing so.
  My hon. Friend the Member for Bristol, North-East (Mr. Adley) was a little unfair when he said that the original Act was drafted without consultation. That was not the case. There was considerable consultation. Up to a point, I have answered his question about making it mandatory on local authorities, and we shall go into it further in Committee.
  Several hon. Members have talked about the rate of interest. I should like to think about this in view of what has been said. To keep it in perspective, we should remember that the interest to be charged under the Bill—I per cent above the PWLB rate—is likely always to be appreciably lower than the borrower would have to pay on a loan from a bank or a financier. I have explained why we felt it right, after discussion with the local authorities, so as to ensure that the Bill got a fair wind from them after its passage through the House, to set the rate ¼ per cent above.
  My hon. Friend mentioned four cases of worry in which, apparently, fire authorities were demanding too much of
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  particular hotels. I would remind him that the basis of the Act is that only work can be required which is reasonable in all circumstances. If this has not been argued fully with the fire authorities in these cases, then it certainly should be.
  My hon. Friend asked whether we had had discussions with the hotel trade before drawing up the Bill. We did not do so, because this was a Bill designed to give particular help to them, and consultation, we felt, was not required. However, we will naturally take into account the views and reactions of the trade during the debates ahead. In answer to his other question, it is the district councils which will administer the scheme, because they are the building authorities.
  I think that I have covered, at least in brief, the main points raised. Others we shall consider very carefully before the Committee stage. In the spirit of welcome, although critical welcome, which has been expressed, I commend the Bill to the House.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

  NORTHERN IRELAND (BORDER POLL)
  11.57 p.m.
  The Minister of State for Northern Ireland (Mr. David Howell): I beg to move,
  That the Northern Ireland (Border Poll) Order, 1972, a draft of which was laid before this House on 14th December, be approved.
  The Northern Ireland (Border Poll) Act was approved by Parliament in order to fulfil a pledge to the people of Northern Ireland that they would be able to vote on the question of the border. The Act provides that a poll shall be held in Northern Ireland to enable voters to say whether they want Northern Ireland to remain part of the United Kingdom, or whether they want their Province to be joined with the Republic of Ireland outside the United Kingdom. My right hon. Friend the Secretary of State has informed this House that he has designated Thursday 8th March as polling day. This was the earliest practicable date on which

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  the poll could have been held, particularly bearing in mind that the date of 8th March will make it possible to hold a poll on the new electoral register which comes into force on 16th February 1973.
  The Act provides that the poll shall be conducted along the lines of an election to this Parliament—that is, under the Westminster Rules. The order has, therefore, been designed to spell out in detail those parts of the existing law which are to be applied or modified for the purpose of the poll. The statutes concerned are the Representation of the People Act 1949 and the Representation of the People Act 1969, together with the Representation of the People (Northern Ireland) Regulations 1969.
  Schedules 1 and 2 of the order, about which I shall have more to say later, list applications and modifications. I am sorry that this has resulted in a rather technical-looking document, but the alternative would have been a self-contained order, which would have been very much longer. Moreover, those concerned with running the poll can see much more clearly from an order in the form now before the House which parts of the existing law are to be applied and modified for the purposes of the border poll.
  The main substance of the order begins with Article 4. Article 4, after setting out the date of the poll, provides for the hours of polling to be from 8 a.m. to 8 p.m. This compares with 7 a.m. to 10 p.m. for a General Election. The reduced hours for polling will enable the majority of voters to vote in daylight—lighting-up time in Belfast will be at about 6.45 p.m. on polling day—and will ease the recruitment of staff for the manning of polling stations.
  I think that these arrangements, which have been made, of course, with the agreement of the returning officers, will be generally well received. It is not expected that the reduction in hours will affect the number of votes cast, particularly in view of the provisions for postal voting, which I shall mention in more detail in a moment.
  The under-sheriffs for Northern Ireland are the returning officers for the poll. All of them, and there are six, will be carry-
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  ing out this role. Article 5 is purely precautionary. It simply provides for the Secretary of State to employ substitute returning officers if, for example, an existing holder of the post was prevented from acting by illness.
  Postal voting is dealt with in article 6, which I have mentioned. I hope that hon. Members will appreciate the arrangements we are making for the extension of postal voting facilities. The order provides that any elector may apply to vote by post if he gives an address in the United Kingdom to which a ballot paper may be sent. I emphasise that this is a very considerable extension of the normal provisions for postal voting and could result in a high proportion of the electorate voting by post. Applications to vote by post should in normal cases reach the registration officer not later than 9th February. The form of application is shown in Schedule 3 to the order, and forms will be available tomorrow at local authority offices and post offices or by postal application to the appropriate registration office.
  The House will also note that in Schedule 2, on page 11 of the order, there is a modification to regulation 16 in order to provide additional safeguards against personation, particularly where postal votes are concerned; where the address of a postal voter is different from the qualifying address, notifications that the application has been allowed will be sent to the applicant at both addresses. Over and above this, we will be having spot checks on application forms to check their authenticity.
  Article 7 enables the Secretary of State to appoint observers to attend at the issue of postal ballot papers, polling stations, the opening and verification of returned ballot papers and at the central count. Since there are no candidates for this Doll, there can be no polling or counting agents in the ordinary sense in this whole operation. However, it is the intention of my right hon. Friend the Secretary of State to invite hon. Members elected for Northern Ireland constituencies, those hon. Members at Westminster and in the Northern Ireland Parliament, to nominate observers who will have broadly similar functions.
  In addition, my right hon. Friend has accepted an offer from the Department of

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  Political Science at the Queen's University, Belfast, to conduct a research project into the border poll, having in mind the undertaking given by the Government during the debate on the Bill
  "to report to the House and to keep the House informed about the outcome of the Poll."—[OFFICIAL REPORT, 23rd November, 1972; Vol. 846, c. 1641]
  It is intended that members of the project team will visit polling stations all over Northern Ireland, and be present at the central count, and later report to my right hon. Friend.
  Mr. Kevin McNamara: The Minister has just made a most strange statement about the function of the team from Queen's University. Does he not think that he ought to elaborate on this matter. What exactly is the project to do? What is the team to report on? Is it the conduct of the poll, the way people vote, or the voting in particular areas? It is a most dangerous suggestion.
  Mr. Howell: I am sorry that the hon. Gentleman thinks it is dangerous. I shall be happy to elaborate in considerable detail on the nature of the project team. I shall come back to some of the specific points raised by the hon. Gentleman, and perhaps give him the full details in correspondence.
  Rev. Ian Paisley: At a General Election, anyone going into a polling station takes a form of oath that he will not reveal any matter that he sees or any matter that may be relevant to the voting. How can this project team visit Northern Ireland and afterwards reveal to the general public how the vote went? I shall have to protest in the strongest possible manner if that is what the Minister has in mind.
  Mr. Howell: All appointed observers and authorised members of the project team would be required to take this oath and they would operate under those conditions. It would be unacceptable to have within the polling stations people who were not bound by those requirements of secrecy.
  Mr. Merlyn Rees: Can the hon. Gentleman tell us, not in detail but in general, what is the purpose of the Queen's University team? It would help if we could be clear about that.
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  The Minister spoke about Stormont Members and Stormont Members who would be allowed to send observers. I wonder whether, on behalf of the Secretary of State, the hon. Gentleman would arrange for an all-party delegation of Members of the House of Commons to go over at the same time to act as observers.
  Mr. Howell: On the first point, I should like to come in much more detail to the nature of the project team because, clearly, there is considerable interest in how it will work. Broadly, the purpose is to observe and report objectively on the conduct of the poll. This is to reinforce the functions that will be fulfilled by the appointed observers. I am sure that all hon. Members recognise the importance of seeing that the poll is conducted in a way which allows observers to ensure that there is the minimum of personation and other abuse.
  My right hon. Friend is favourable towards the idea of an all-party delegation and will be glad to pursue the matter with the hon. Gentleman through the usual channels.
  Now I come to Articles 8 and 9, which deal with the counting of votes and the declaration of the result. The votes are to be counted at one central point, and my right hon. Friend the Secretary of State has appointed the Under-Sheriff of Belfast and Antrim to be in charge of the central count. As the House knows, the result of the poll will be declared for Northern Ireland as a whole and not by constituencies or other geographical areas. My right hon. Friend will publish the result as soon as possible after polling day.
  One important feature of Schedule 1 is that it applies and modifies the parliamentary elections rules made under the Representation of the People Act 1949, as amended. Rule 26, which is on page 8 of the order, is very important because it enables a returning officer to provide a sufficient number of polling stations and allot electors to them. As a result of an examination carried out with the help of the security forces, returning officers have decided to use about 380 polling places, and a polling place may include a number of polling stations.
  This is a considerable reduction from the 900 or so used in the last General

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  Election. Although the number of polling places has been reduced, every attempt has been made, taking security into account, to limit the distances that electors will have to travel to reach their polling places. The extended facilities for postal voting should ensure that electors will not be inconvenienced or deterred if their normal polling place is not being used—as may be the case in some instances—and the smaller number will greatly ease the problem of security.
  Rules 33, 34, and 37 contain important modifications bearing on the question of security and the role of the security forces. The House may recall that my right hon. Friend undertook that we shall do everything we can to provide appropriate security for the poll. At polling stations law and order will, as is normally the case, be the responsibility of the presiding officer, assisted by the police.
  However, we have felt it right to provide in the order for a situation where the Army might be needed in aid of the civil power. Hon. Members will of course, hope, as I do, that the Army will not be required to act in this way during the poll, but this provision has to be made.
  Finally, I should like to mention some matters under the heading of publicity. Rule 6 of the parliamentary elections rules applied in Schedule 1 on page 7 of the order provides for the returning officer to publicise the date and hours of the poll, the polling stations to be used, the latest date for the receipt of applications for postal voting, and the addresses of registration and returning officers. Publication will begin as soon as possible after this order has been approved by the House.
  Also in Schedule 1, rule 29 on page 8 provides that official poll cards will be issued to each elector. Hon. Members will find the design of the poll card indicated in Schedule 2 on page 13, which shows modifications to the normal poll card. The questions which will appear on the ballot paper will be set out on the poll card, and arrangements are being made for a certain amount of additional publicity of a purely factual nature about the poll to be given in the Press and on television. Hon. Members will find that the form of ballot paper is specified in the modification to rule 19 in Schedule 1
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  on page 8 of the order and in the appendix to Schedule I on page 10.
  Mr. Merlyn Rees: If I may again intervene to save time, the hon. Member explained, with the aid of the schedule, the form of the poll card, and we have known for some time—since the debate in the House—that there will be poll cards. Can he tell us where, in the main body of the Act or in the order, it is stated that poll cards shall be issued in the election?
  Mr. Howell: The matter is covered mainly in the schedule, but I shall check in detail and answer the hon. Member's question later. However, as I understand it, the matter is covered in the schedules rather than being specified in the Act, but I am open to question.
  Mr. A. W. Stallard: Before the Minister leaves the postal vote, will he say whether efforts will be made to contact people who have left Northern Ireland in the last 12 months for a number of reasons?
  Mr. Howell: There will be considerable publicity in Northern Ireland, and those who wish to participate and vote and are on the electoral register, or are on after 15th February, will be entitled to a postal vote. If the hon. Member has in mind members of the Armed Forces, applications for postal votes are being distributed to various units so that those overseas can vote.
  Mr. Stallard: I have in mind ordinary civilians who have left, and many have come to inner London, for a number of reasons: Protestants married to Catholics or those whose homes have been destroyed. They hope to go back. What efforts will be made to contact them?
  Mr. Howell: They will be entitled to vote, if they wish, and to apply for a postal vote. But there will, of course, be no specific effort to contact each one; that would not be proper. But friends may contact them if they wish, and there will be an opportunity for people to have a postal vote.
  I have touched on some details, and many more hon. Members will wish to raise points which I shall do my best to answer.

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  This poll will give the people of Northern Ireland their first opportunity for a number of years to record their views through the ballot box. It will be regarded by many people in Britain and abroad as setting a standard for democratic behaviour in Northern Ireland. It will be seen as of particular importance as the precursor of the local government elections which have been announced. I should emphasise that we are also taking unprecedented measures to minimise abuse. I hope, therefore, that all hon. Members will join me in expressing the hope that this poll can be conducted as a peaceful and orderly expression of opinion. In the light of that hope I commend the order to the House.
  12.15 a.m.
  Mr. Merlyn Rees: Over the last nine months since direct rule we have had a problem of procedure which still exists. The one and a half hours allowed for debate are proper for an order and proper following a Second Reading. However, even on this order, not because in essence it is as important as a Second Reading, there are many questions which we could, and should, ask, and we could do with more time, and at a different time of the day.
  We made our points of principle on Second Reading of the Northern Ireland (Border Poll) Bill. They were embodied in a reasoned Amendment. We have not changed our minds. Our view is that the plebiscite on the border will tell us what we know, that the questions are too narrow, and that the White Paper should precede the Border Poll Bill.
  The order gives us in legislative form the date which the Minister reminded us we had known for some weeks. This was determined by the logic of events, and, as we suggested in early debates, the main premise in this logical process was the date of issue of the new register on 15th February which would give the chance to vote to the greatest number of people.
  Nevertheless, the plebiscite will tell us only what we already know, and I could only wish that we were discussing the rules for a proper election in Northern Ireland, because increasingly as we move in this period of direct rule we shall have to determine what the people of Northern Ireland really think. Many of those who
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  say that they represent the people of Northern Ireland were elected a long time ago and a lot of political water has passed under the bridge since then.
  As to Article 7, we have observers under the Westminster Rules. All hon. Members know of the arrangements whereby observers are allowed into the polling booth as our representatives but by permission of the returning officer. Because there are no political parties it is clear that there have to be different rules.
  Are the changes in the observer rules laid down in legislation going back to the 1949 Act and culminating in the 1969 Act made under Section 1(2) of the Border Poll Act which provided that the Secretary of State could
  "make such further provision as to the conduct of the poll …as may appear to him to be expedient"?
  The Minister told us about observers from political parties in Northern Ireland and on behalf of the Secretary of State. He has assured us that arrangements can be made through the usual channels for hon. Members to go as well. Will there be any control on the type of person whom Members of Parliament from Stormont or here choose as their representatives?
  Perhaps I can ignore the fact that we are going from here. But, as the hon. Gentleman has explained it, is it the case that any Westminster Member from Northern Ireland can nominate people to represent him at the polls? That is as I understand it. Does it mean that he can do so only in his own constituency? Or can he nominate persons to go to other constituencies in Northern Ireland? I am not asking that there should be control, but can anyone be nominated as an observer? This is germane to the question asked by my hon. Friend the Member for Kingston upon Hull, North (Mr. McNamara) about the investigators from the Queen's University. Can a Stormont Member of Parliament nominate anyone he wishes to represent him in the polling booth?
  Who will sign the observer's form? We here call the observer "polling agent". An observer will have to get a form signed, and it must be countersigned by the returning officer. He has to sign that he will not interfere, and so on. If there is complete freedom of

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  action for Members of Parliament to choose whom they like to go into polling booths, this may not in certain circumstances be so easy to perform. Who, therefore, will sign the observer's form giving him or his nominee the power to go into polling booths?
  Rev. Ian Paisley: Is the hon. Gentleman aware that in Northern Ireland elections a polling agent has to take his form of declaration before a justice of the peace before he can be nominated, and then it must be certified by the election agent that he is appearing for a particular candidate?
  Mr. Rees: It is the same under the Westminster Rules. The hon. Gentleman has asked my question in a much clearer form. It leads me on to the question of the Department of Political Science at the Queen's University. I will read a letter sent to me this morning by the Secretary of State. He said:
  "In addition, I am accepting the offer from the Department of Political Science at Queens University, Belfast, to conduct a research project into the Border Poll; this is against the background that during the debate on the Bill the Government undertook 'to report to the House and to keep the House informed about the outcome of the poll'. Members of the project team will visit polling stations all over Northern Ireland, and be present at the central count, and will later render a report to me."
  In principle, and bearing in mind what the right hon. Gentleman promised us, I have no objection to this, but we must be clear about the purpose of the research project and that the Secretary of State will report to the House. If the project's purpose is to inform the Secretary of State about the way the poll was run, that is different from a research project to be published in learned journals and fussed and talked about over a period of years. It then comes into the question of the secrecy of the poll, which is something we have always been very careful to protect.
  Postal voting provisions are contained in paragraph 6 of the order. As I understand it, postal voting is now divided into two under the powers we gave the Secretary of State in the Act. There is a new type of postal voting which is different from the postal voting under the ordinary Westminster Rules. Then there
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  are the existing Westminster Rules on postal voting, which have grown up since the war years.
  It is important to clarify our minds on this because postal voting on a very large scale in the context of the problems and lawlessness in Northern Ireland could cause very important problems. Is it the case that the rules that apply to Westminster elections for postal votes will apply here? There is Representation of the People Form 7 which applies to employment for the blind and for the physically incapacitated. There is the RPF 7(a) for journeys by air and sea, which might well be relevant in parts of Northern Ireland. There are RPF 8 for removals, RPF 9 for religious observance for the reserve and auxiliary forces, for the returning officer and his staff and constables, RPF 10 for civilian electors abroad and at sea, and RPF 11 for the elector's proxy. I presume that all these are available on the same terms here as for a Westminster election.
  Proxy voting will be allowed, but will it be allowed for the new type of postal voting which the Government are organising for this plebiscite, or will it only be under the Westminster Rules in the way to which we have become accustomed over the years? Will there be proxy voting for the new general postal votes which the Government will permit.
  Mr. David Howell: There will, of course, be proxy voting, and it is a little extended by the order. There will be the extended form of postal voting. The hon. Member is now asking whether proxy voting will be involved with postal voting, which is the point I cannot grasp.
  Mr. Rees: I am making the point that if the Government had not decided to extend postal voting and all we had were the existing rules there could be proxy voting for the existing postal votes. It would be possible to have voting by proxy, even though the votes are postal votes. Will the same arrangements apply for the more general type of postal votes?
  I welcome postal votes at elections, but I found when I was a Minister at the Home Office that they are open to great abuse. There was a particular case in the East Midlands, the details of which I have forgotten, but I am sure that such abuse is not unusual.

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  I have argued in this House on other occasions that in our parliamentary elections if there are to be extended postal votes the extension to individuals should not be at the whim of party organisations. Over the last 100 years we have given the vote to an increasing number of people, and the giving of the vote is organised by the registration officer in the parliamentary borough concerned. It is his job to seek our people to ensure that they get the vote. Unlike in the United States, there is the annual collection of voters lists. It is not a function of the political parties. The only thing in this country which is similar to the United States is the getting of postal votes. I know to my cost that in certain parts of the United Kingdom it is easier for one political party to get postal votes than for others. I do not refer to my present constituency. One has to know one's way about. One has to know one's way into doctors' surgeries. There is a certain amount of suspicion about it. But getting people to take a postal vote for parliamentary elections is a function of the political parties. The registration officer does not go running about except for the occasional advertisement advising people to take a postal vote. This is up to the political parties. What about getting people to use postal votes in Northern Ireland when there are no political parties playing a part in the plebiscite? I am reinforcing the question put by my hon. Friend the Member for St. Pancras, North (Mr. Stallard).
  Mr. Stallard: Will my hon. Friend include in his survey the postal votes of those who have been interned or detained but not convicted? Will they be entitled to a postal vote?
  Mr. Rees: That is another most interesting point. I am sure that the Minister will be able to inform us of this either now or at the appropriate moment.
  Mr. David Howell: The answer is "yes".
  Mr. Rees: People who are interned will be able to vote. There could be abuse at the time of getting the form signed. It has been put to me, and it is as well to consider these problems rather than sweep them under the carpet, that there could he abuse of postal votes in those areas where there has been a large removal of the population, particularly in
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  parts of Belfast. There are areas in Belfast from which populations have moved since the last registration took place in September-November last.
  The question is how to make sure that there is not abuse. The Minister said that the Secretary of State had looked at the security aspect of the polling booths. I hope there will be liaison between the Housing Executive, the electoral authority and the postal authorities in these cases.
  Within those areas where there has not been mass removal, where postal votes forms are to be delivered, the postman needs protecting.
  Mr. John E. Maginnis: Is the hon. Gentleman aware that in many areas of Belfast the occupants of the houses are there as squatters? There are 5,000 of them. How will that work out?
  Mr. Rees: What we are trying to do, now that the Government have decided to have a plebiscite, is to make sure that it is run in the best possible way. We are bringing these problems to the attention of the Government.
  What about the penalties for abuse? I took a look at "The Conduct of Parliamentary Elections" which is a publication of Labour Party headquarters and is based entirely on the legislation to which the Minister referred. I find that there are two types of illegal practice in the Westminster Rules, and I presume that they will apply to this plebiscite. One is corrupt practice, which goes hack to the early legislation in the 1880s. The other is illegal practice.
  These have to be taken into account in Northern Ireland. It will be a corrupt practice to vote as some other person, whether by voting in person or by post or as proxy. Bribery, treating and undue influence are corrupt practices. Making use of or threatening physical force or violence or restraint, temporal or spiritual injury, fraudulent devices or contrivances impeding or preventing the free exercise of the franchise of an elector, false declaration, incurring expenditure without authority—they are all corrupt.
  There are a lot of things that are illegal. It is illegal to broadcast from outside the United Kingdom except by arrangement with the BBC or ITA. It strikes me that there could be a situation where people may be broadcasting from outside

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  the United Kingdom, given the Northern Ireland question, when according to the rules it will be corrupt. The penalties for these offences are great. I hope that the Government will clearly publicise the penalties for illegal and corrupt practices.
  Rev. Ian Paisley: Does the hon. Gentleman suggest that a Northern Ireland politician who made a broadcast about the poll from RTE in Dublin would be guilty of corrupt practice because the broadcast emanated from a place outside the United Kingdom?
  Mr. Rees: I am not a lawyer, so I cannot comment on that.
  Can postal votes be refused in the way they can be refused under the Westminster Rules? Article 6 refers to a time limit which is different from that under the existing rules. The article specifies that applications for postal votes must be received at least 23 days before the holding of the poll. The time limit for postal votes in England for local government elections is 14 days and for parliamentary elections 12 days. Why is there this difference?
  For a normal Westminster election copies of the absent voters list are available and can be used for political purposes. I presume that there is an absent voters list already in existence in Northern Ireland under the old rules—
  Mr. Rafton Pounder: No.
  Mr. Rees: Then I put it in the interrogative. Is there an absent voters list already in existence, and, if so, is it to be ignored? Will there be two absent voters lists, one under the Westminster Rules and one under the Whitelaw rules? Will the absent voters list be open to public examination, or is it to be for the benefit only of the registration officer?
  The Minister has explained the verification procedure for postal voting and has said that a model form can be seen in Schedule 3. The form mentions ministers of religion and Members of Parliament, but I have been asked to point out that it does not mention Christian Science practitioners.
  Mr. David Howell: If the hon. Gentleman will look at footnote 1(a) to Schedule
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  3 he will find that a Christian Science practitioner is included.
  Mr. Rees: I am sorry to have wasted the Minister's time on that.
  How will the result of the poll be notified? Will the procedure be similar to that which is used for the declaration of the result of an election?
  I am still worried about the location of polling booths and so are hon. Members with much greater experience of this matter than I have. I hope we shall have firmer information to the effect that it will not be necessary, even for postal voting, for a person in a sectarian area to have to go through a sectarian area of the opposite view. That applies particularly in parts of Belfast.
  As for the publication of results, I can understand why the Secretary of State intends to give a mass result rather than broken-down results. Once we begin to think of altering the border and of hiving off parts of Northern Ireland, it will be regarded as a sign of the failure of the Government's political initiative which we have supported over the past year. We know that a large number of people in Fermanagh, Armagh and Derry do not wish to be part of the United Kingdom, and if the results were broken up it would tell us how foolishly the border was drawn 40 years ago.
  We regard the border poll procedure as foolish. It is not that we want to ignore the views of the Protestants, but that we believe the results will only tell us what we already know. I regard the Bill as administrative practice for the real election that is to come.
  It would be idle to pretend that there is not some fear that there will be violence on polling day. We regard the Northern Ireland (Border Poll) Act as a hangover from last March, but we regard anybody who uses this occasion as an excuse for a day of violence as extremely foolish in terms of the long-term needs of Northern Ireland. It would be easy for somebody to use that day to "show off" by indulging in violence. Therefore, whatever view is taken about the poll, we hope that it will not be regarded as the occasion for violence.
  I am reminded of an ancient clause which now stands as the first enactment

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  on the roll of our electoral law. It dates back to 1275. The spirit behind it is that elections should be free. It reads:
  "…the King commandeth upon great forfeiture that no man by force of arms, nor by malice or menacing, shall disturb any to make free election."
  We on this side of the House have grave doubts about the border poll, but we hope that there will be no violence on that day. Those who want to express their view about the poll should be allowed to go about their business. We hope that it will be the beginning of a step towards a proper election in Northern Ireland.
  12.43 a.m.
  Mr. Stratton Mills: I wish to echo the view put forward by the Minister of State and by the hon. Member for Leeds, South (Mr. Merlyn Rees) that the poll should take place in a peaceful, dignified atmosphere to enable the people of Northern Ireland to express their view at the ballot box, and I hope that the poll will not be interfered with by any kind of trouble. I firmly endorse their view and join in their hope.
  Nevertheless, I wish to seek an assurance that a sufficient number of the security forces will be used to ensure that the poll is made a reality. Perhaps my hon. Friend will tell us the Government's intentions about the number of troops, and so on. I hope the poll will be free from intimidation. We have been told that there are to be only 380 polling booths against the normal total of 900. I regard that as a wise move because one strongly hopes that people will be able to express their views free from intimidation.
  In normal parliamentary elections there is a restriction on the spending of money by the candidates in a poll. It would appear that there is no such restriction on the spending of money in the border poll. There are a number of parties and political groups on this side of the House which support the right of Northern Ireland to remain inside the United Kingdom, but there might be one group which had more money than the others and might be able to put itself in a rather exaggerated position by giving the impression that it was the sole guardian of the Northern Ireland constitution. However, I leave it to my hon. Friend to give us some information about that.
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  The date of 8th March has been given for the poll. I assume, as does the first editorial in The Times today, that it is not intended to link the publication of the White Paper with the poll and that whether the White Paper comes before or after the poll will be an issue to be decided in isolation. Nevertheless, the experience of the border poll and giving people the right to self-determination might be linked to other ideas.
  A number of people feel, for instance, that it is not enough to produce a White Paper and hope that it is sufficient, and that without in any way questioning the judgment or the right or the authority of the House so to do. However, if one has experience of a border poll and its mechanism, there is surely much wisdom—this is the point that I made in a letter to The Times the week before last—in giving the people of Northern Ireland an opportunity in a second poll to express their attitude to the forthcoming White Paper, for only if it has the support and involvement—which is doubly important—of the people of Northern Ireland has it a chance of sticking. If I develop that further, I shall be out of order, but I feel that experience of this poll may be of assistance in this respect.
  I fully appreciate that holes may be picked in the concept of having a second referendum in Northern Ireland. One could equally pick holes in any of the other methods by which to proceed, and, therefore, the principle of involving the people in a second poll has much merit.
  12.47 a.m.
  Mr. Kevin McNamara: As many hon. Members wish to take part in the debate and time is limited, I shall not take long. I should like to deal briefly with a number of matters mentioned by the Minister.
  He mentioned a reduction in the number of polling stations. A reduction of two thirds is not insignificant. A reduction from about 900 to about 300 is considerable, and that, I understand, is a reduction in the number of physical stations as such, and so the problems of conducting the poll will be considerable. I repeat the question of my hon. Friend the Member for Leeds, South (Mr. Merlyn Rees)—what will be the problems of people who have to cross rival areas in order to vote?

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  The hon. Member for Belfast, North (Mr. Stratton Mills) mentioned money and one party appearing to be "holier than thou" in its desire to create a united Ireland, or in its desire to retain the link with the United Kingdom. Sitting Members representing Northern Ireland constituencies in Stormont or in Westminster have the right to nominate observers. But in the past it has been not only the victorious candidates who have been able to nominate observers but people who have been representative of different points of view. Therefore, we are giving a right to what is already a vested interest and not to organisations which have not had representation in Stormont or in this House but which may, under the terms of the argument advanced by the hon. Gentleman and by my hon. Friend, be more representative of opinion in Northern Ireland at the moment than Members of this House or of the former Stormont. The Minister of State should look again at the right of people who are not members of political parties represented here or in Stormont but who are members of political parties to attend as observers at these counts. This is very important.
  The next matter to which I wish to refer concerns the procedure for the count. It has been said that the count will be done purely and simply for the whole of Northern Ireland. That may be the case, but the count may be conducted in such a manner that the information which the Secretary of State is at present seeking to conceal from us in the sense that he wants a result for the whole of Ireland and not for a constituency or area may be available to the Secretary of State but not available to the remainder of the country.
  In any constituency election, a box containing votes may be brought in to be counted. All the votes may be tipped together and mixed up and then examined for the way that people have voted and have spoiled papers before being counted. An individual box may be tipped out and examined for the way that people have voted and have spoiled papers. In that way there is a record of the way that people in a specific polling area have voted. Will that information be available to the Secretary of State, or will it, along with all the other votes, be
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  thrown together into one huge table which will then have various facts extracted from it? This is important in recognising the bona fides of the way in which the count is to be held.
  Then there are the terms of the rather surprising announcement which the Minister of State made tonight and which he revealed to my hon. Friend in a letter this morning about the Queen's University research project. What exactly is entailed in this research project? What will be reported to the Secretary of State, and what part of the report will in turn be presented to this House and to the people of the United Kingdom and of Northern Ireland? If it is just a matter of saying that 70 per cent. of the people voted in the Falls, that 100 per cent. in the Shanklin voted or that 200 per cent. in the Bogside voted, statistical information of that kind can be gained in any event. We can discover how many voted in the first hour, whether there was a big or a small turnout, what effect the weather had and what was on television earlier that night. If we are to have a research project, it must be into other matters—not just into the methods by which people voted or how they voted, but into what were their attitudes to the poll, how they voted in specific areas, and what was the relevance of issues which they regarded as being important in the vote. If we have a research project on these lines, we must have an undertaking that no part of the results of the project will be held back by the Secretary of State. It must all be made available to this House and to the people of Northern Ireland.
  Secondly, and more important, we have to consider the position of the individual voter and the secrecy of his vote. It is all very well for people to say that this person or that signs a form and gives an undertaking not to reveal what he has seen inside a polling booth or anything that he has discovered. Conclusions can be drawn from reports about what a person has or has not seen. The secrecy of the vote can be affected in that way.
  There are many ways in which it is possible, when the votes have been cast, for the information which the rest of us are not to get to be kept by the Secretary of State. I think that we ought to have certain undertakings from the Minister of State on this matter.

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  I am not necessarily against a research project. I think that the rôle of psephologists can be very important. But why on this occasion and for what particular reasons against a background where we have had no promise of a White Paper? Therefore, we do not know what the Government's intentions are. The people of Northern Ireland will be voting, and there will be a research project based upon that voting which might, after publication of the White Paper, be completely irrelevant.
  Those are some of the points that wished to cover. Like my hon. Friend the Member for Leeds, South, I know the answers. The questions are wrong. We are trying yet again to save the Prime Minister's face. He has stood on his head so often, but we might as well try to save him again. However, I suggest that there is no point in having the poll.
  12.57 a.m.
  Mr. John E. Maginnis: I shall be only a few minutes in making my remarks at this time of the morning.
  First, will the Minister give us an assurance on when the new register will be available? This is the first time in the history of Northern Ireland that there has been a delay in the publication of a register. Most people are anxious to know when the new register will be available.
  Secondly, will the hon. Gentleman make absolutely clear the position on postal voting? Most people feel that they cannot apply for a postal vote until the new register is available. I understand—I may be wrong—that one applies for a postal vote on the existing register and then the authority checks to see whether one's name appears on the new register. This is a matter which most people do not appreciate.
  Following the question of postal voting comes the question of abuse. We all know that an address in the United Kingdom must be given. What precautions is the Minister taking to see that accommodation addresses will not be used extensively for postal votes? This can happen. Is he aware that 50 per cent. of the electorate may apply for postal voting? If so, are the postal authorities equipped to deal with that number of applications? During the last election
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  large numbers of poll cards sent out to postal voters went astray.
  Regarding security in rural areas, the Minister has stated that the numbers of polling stations have been greatly reduced. That means that people in rural areas will have to travel greater distances. This matter will have to be looked at very seriously, because security will be the main problem in the border poll.
  I have always supported the holding of a border poll for Northern Ireland. We have heard stated tonight that the result will be a foregone conclusion. It is not the result which is the main question on the border poll; it is the right of the people of Northern Ireland to express their own views, because they can no longer express them through their elected representatives at Stormont. The border poll is a must because it will give the people of Northern Ireland the right to express their views on the border one way or the other because they have no representatives to do it for them. That is a point which must be forced home on every occasion. I hope, as the hon. Member for Belfast, North (Mr. Stratton Mills) and the hon. Member for Leeds, South (Mr. Merlyn Rees) have stated, that we shall have a border poll free from intimidation and free from violence of any description. It is the first opportunity the people of Northern Ireland have had for a long time of going to the polls. Sensible people will want to ensure that the poll is conducted in an orderly manner. I hope that most people in Northern Ireland will realise that the world is watching and that an orderly poll conducted with due dignity and decorum will go a long way in restoring Northern Ireland's position throughout not only the United Kingdom but the rest of the world.
  1.1 a.m.
  Mr. Gerard Fitt: I protest in the strongest possible way at the way this debate has been carried out and the short time that has been given to a matter of such importance. There are almost nine columns of modifications to existing electoral law, and I am certain that the hon. Members who are taking part in the debate have not had time to correlate the modifications with the existing electoral law. We have been given one and a half hours to discuss an

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  issue of great importance to all the people of the United Kingdom. In making this protest I am certain that I speak for the hon. Member for Antrim, North (Rev. Ian Paisley), who I hope will be fortunate in catching your eye, Mr. Deputy Speaker, before the end of the debate.
  Mr. Stanley R. McMaster Mr. Stanley R. McMaster (Belfast, East) rose——
  Mr. Fitt: I will not give way. In the order there are some minor and some major modifications which necessitate a full day's debate. The most major modification on Article 6 relates to postal voting. The last date for the receipt of the application for a postal vote is to be 9th February 1973. That is 22 or 23 days before the polling date. Why did there have to be such a long lapse? Is it because of the sad experience that we had with the postal facilities over the Christmas period? If that is the reason, one can readily understand it. But it means that people will be limited to a great extent by having to adhere to that date. The register comes into operation on 15th February, and consequently people will have to apply for a postal vote on the number contained in the old register.
  Mr. David Howell Mr. David Howell rose——
  Mr. Fitt: Many people have had to change their address since September 1972, since the qualifying date, because of political disturbance. Both Catholics and Protestants have been affected, particularly the Catholic minority in Belfast.
  Mr. Howell: There is a danger of confusion arising where there is really no confusion. All electors who believe themselves to be qualified to be on the electoral register will be entitled to apply for a postal vote if they wish. It does not matter as long as they apply before 9th February. If they turn out to be on the new electoral register they will qualify; if they are not, they will not.
  Mr. Fitt: Many people have been forced to shift their residence, particularly in Belfast, and even at the time of the compilation of the register it was not possible for those who were preparing the register to go into certain streets and areas. What was done in those circumstances was to compare the register they were preparing with the existing register.
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  Many people who prepared the new register were not admitted to the riot-torn areas of Belfast. There will be thousands of people in Belfast whose names will not be on the register.
  If a person has to apply on the 9th February, when will the poll card be sent? Will it be sent out a week or a fortnight later? I suggest that the poll card should be sent out earlier so that people who are not sure whether their names are on the register will at least have the benefit of knowing that the poll card has been sent out. But if they wait until after they have made the claim, they do not know whether or not they are on the register.
  The Minister has said that the Secretary of State will take powers to appoint observers, and that he intends to extend this facility to Members of Parliament, both here and in Northern Ireland. But many parts of Northern Ireland do not have MPs. In the constituency of the hon. Member for Belfast, North (Mr. Stratton Mills), two Northern Ireland constituencies, Shankill and Woodfield, do not have Members of Parliament because they resigned when direct rule took place. Who will be the accepted voice of the people in those areas? What will be the criteria in appointing observers? There are many questions which one would demand to ask; because of the time limitation, this debate will be completely unsatisfactory.
  There were nearly 1,000 polling stations, but now there will be only 380. This means that people will have to travel further if they want to record their votes, if they do not wish to use the postal facilities. Many people, particularly in the rural areas, have been used to voting at their local polling station, which was erected on the creation of the State 50 years ago. They will be unwilling to travel. It seems to me that the Secretary of State has taken this attitude for the administrative convenience of himself and his officers.
  With my knowledge of Northern Ireland—the hon. Member for Antrim, North could probably elaborate at greater length—I know that some people will be deeply confused by the order. They have never had a postal vote in their lives; they are unsure whom to approach for the application, whether their names

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  are on the register in Belfast or whether they are on the old or the new register. All this will make the poll completely invalid.
  I have always thought that this poll will cause mischief and great danger in Northern Ireland, and I still adhere to that view. We all know the result. Carried out under this order, the poll will cause a great deal of inconvenience and possibly danger. Opposed to the poll as I am—I speak for my party—I know that many moderate people in Northern Ireland will have to boycott it and advise those whom they represent to do the same, because we already know the result. But I associate myself with the plea of the Minister and my hon. Friend the Member for Leeds, South (Mr. Merlyn Rees) that, if and when the poll takes place, no one should engage in any way in violence with the intention of bringing about his own result.
  1.9 a.m.
  Rev. Ian Paisley: As a representative from Northern Ireland, I must again register, in the strongest possible manner, my utter disgust at the way in which this matter has been presented in the House. It was the bounden duty of the Secretary of State to be present himself for this most important debate. The Act which the House passed gave us no information whatever. Now, in a draft order, we have been given other information, some of which has come as a bombshell to the House.
  Over 900 polling stations are to be reduced to fewer than 400. That means that people in my area, North Antrim, will have to travel through areas which they never travel through. Parts of my area are strongly nationalist and other parts are equally strongly Protestant. It has always been the custom that in those areas with a particular political outlook the polling stations are located near where the residents live, so that they can use them at their convenience.
  I am for the border poll. I was for it, and I suggested it before direct rule took place. But I do not want it to go out to the world that there was anything about the poll that could not be subjected to the closest possible scrutiny. At the polling stations in Northern Ireland I do not want to see vast numbers of Her
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  Majesty's troops. The soldiers must certainly be there, because of security, but I do not want to see them with armoured cars. If that is what has been suggested by the hon. Member for Belfast, North (Mr. Stratton Mills), that there should be such a saturation of troops on the day that it would be evident that the troops were there in abundance, it would give the world an impression entirely contrary to the proper situation.
  The majority of people in Northern Ireland want to remain part and parcel of the United Kingdom. Even those opposing that desire admit that. I do not want it to go out to the world that because of the presence of British troops on that day the people of Northern Ireland voted to remain a part of the United Kingdom. I understand that there is a security problem. I freely admit that. But I want to ask the Minister some questions of vital importance.
  I take up a question referred to by the hon. Member for Kingston upon Hull, North (Mr. McNamara). At the last election in my constituency five parties fought for the seat. Those parties have as much right as I have to have observers at this poll. They are just as much entitled to have a representative at the ballot boxes on that day as I am. Why should it be limited to the person who happens on the day to hold the seat? I make a plea to the Minister to look into this and see whether it would be possible for those parties which fought for the various seats at the last election to nominate observers. Otherwise what will people say? They will say "Oh, it was only the Member of Parliament who had the right to go in and see whether the poll was in order." I should like it to be done in such a way that no one afterwards could say "Only those who happened to be Members of Parliament saw what was going on."
  We must have the opportunity across the board for those who have also fought for the various seats, at least at the last election. We must limit it in some way in that they should have an opportunity to nominate agents to go in and see that the voting is done properly and an opportunity to question the presiding officer and to lodge any complaint. Who will lodge a complaint if they do not have

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  access to the presiding officer? One cannot say to a presiding officer "Come outside." Everyone knows that he has to stay inside at the boxes. If someone has a complaint, how can he make it if there is no representative of his political group inside the station to make representations?
  This is a very important matter. I am not at all happy about this, and I believe that I speak for a vast number of people in Northern Ireland who think that we shall be made guinea pigs for this Queen's University project. The electors in this country would resent such a project taking place at a General Election. This will not be acceptable in Northern Ireland.
  Are these people to be allowed into the stations when legitimate political parties' representatives are to be denied access? Are people who have fought these seats for the past 50 years to be denied the right to have an observer in the boxes, whereas this team can enter and make investigations? What is the team to investigate, and what will be the result of the investigation? I think that this matter needs to be considered carefully. I plead with the Minister to make the strongest possible representations to his right hon. Friend to reconsider the whole matter because, as far as I know, no political party in Northern Ireland or no shade of political grouping there has ever been consulted about this provision, yet it is to be foisted upon us.
  I want the border poll to take place. 1 advocated it before direct rule came about. It should have taken place a long time ago. I want it carried out in such a way that there can be no objections from any side after it is over. I want the poll to be conducted in such a way that everyone can see that it has been carried out in accordance with the best British traditions.
  We have not had time to ventilate the strong feelings of this side of the House on this matter. The Minister must think carefully about some of the regulations that have been proposed, and especially those relating to the register, because if I apply under one register and then discover that I am not on the other that will lead to great difficulties.
  1.16 a.m.
  Mr. David Howell: I am the first to recognise the inadequacy of the opportunities that we have in this House to debate Northern Ireland matters under the Northern Ireland (Temporary Provisions) Act. Indeed, it is precisely because my right hon. Friend and I recognise the inadequacy of the opportunities for debate that we are seeking to move towards a constitutional settlement in Northern Ireland that will allow for a happier and fuller discussion of this and other important issues. Let it not be thought that there is any complacency about the present position or about the desire and the need to improve the situation and move on to a better constitutional settlement.
  Mr. McMaster: Is my hon. Friend aware that although some of us have been to great trouble to collect views on this order throughout Northern Ireland we have had no opportunity of putting those views to the House? In addition, we have been given no opportunity to amend the order. There are many details about which a number of people in Northern Ireland are not satisfied. They would like these matters to be considered by the Minister and amendments made to the order. There is no possibility of doing that, and I protest strongly.
  Mr. Howell: I know that, and I shall try to answer some of the questions that have been asked and deal with some of the confusion that has arisen.
  The first matter is that of the observers. The proposition is that any Member of the Northern Ireland Parliament at Stormont or of the Westminster Parliament can nominate any number of observers for any polling stations that he or she wishes. There is no limit. This is obviously a matter to be worked out in the light of common sense so that my right hon. Friend can appoint those observers who have been nominated, but there is no question, as I said in opening the debate, of nominations being limited to the one nominee whom a Member of Parliament may place within his own constituency. The opportunity is there, within these rules, for observers from all parties involved in and campaigning in the poll to be appointed to the polling stations. There is in theory no limit to the number, but one hopes that common

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  sense and a sense of responsibility by Members of Stormont and the House of Commons will ensure that there is a sensible limitation on the numbers appointed.
  My right hon. Friend must reserve the right to apply some overall restraint should people deliberately try to abuse the system, though I am sure that they will not. The main point is that observers from all parties will be allowed to enter all polling stations, having taken the necessary oath of secrecy, to ensure that abuses are not allowed and that the poll proceeds in the way that they would wish.
  There has been some misapprehension about the research project. The latter is, of course, confined to the method by which the poll takes place. It is not a project which would in any sense go into the motivations or reasons or into any other part of the voting process or into the private and secret way in which individuals vote or why they vote.
  This project will be carried out with the object of describing and analysing the border poll, the arrangements for conducting it, its result, and any relevant events. We envisage that research will be done and published by Professor Lawrence, Dr. Elliott and Mr. Laver, all of the Department of Political Science of the Queen's University, Belfast.
  I note the doubts expressed by hon. Members, but it is a sensible project which can greatly help to ensure that impartial observers are involved in the process of the ballot by ensuring that a report is available afterwards showing the impartiality and drawing important lessons from the poll. It will be a valuable and useful exercise.
  The hon. Member for Leeds, South (Mr. Merlyn Rees) asked me several questions, and I have not the time to answer all. He asked about those entitled to a proxy vote. The rules are the same as for Westminster with the addition for members of the reserve forces and the UDR who need one because they are on duty and so on. They will be entitled to a postal vote.
  The hon. Member asked whether anybody can be refused a postal vote. No, provided that it is not a fraudulent application and that it is certified by those who certify postal votes.
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  The hon. Member asked whether their was a time limit for receiving postal votes. Applications must be in by 9th February. All those who believe themselves to be on the electoral register may take an application form from a post office, but if they are not on the register they are not entitled to vote. If they have not applied for a postal vote they will get a polling card entitling them to vote in person.
  A number of points were made about the need to ensure that there was no intimidation, and that is recognised and accepted in the desire to see a considerable extension of the postal vote.
  We have to look on the poll as one which will mean a great extension of the postal vote and which will thereby ensure that many people who might be intimidated or worried about going through hostile areas or worried about having to travel rather further than they normally do will be able to exercise their democratic right by a postal vote.
  We accept that there will be a substantial postal vote and have made preparation for one. That was the valuable point made by my hon. Friend the Member for Armagh (Mr. Maginnis).
  The hon. Member for Kingston upon Hull, North (Mr. McNamara) also asked about the reduction in the number of polling stations. That point has, I believe, been met by the considerable extension of facilities for postal votes.
  The hon. Member, too, mentioned the point about Members of Parliament nominating observers. This is important, and I have made the point that a Member of Parliament can nominate as many as he may wish so that members of all parties can be at the polling stations.
  A number of provisions have been made on forgery and fraudulence. Applications for postal votes must be made in person, and an acknowledgment will be sent to the address of the person making it and to his address in the electoral register to ensure that no application is being made for a vote without that person's knowledge. This provision will help. In addition there will be a number of spot checks to ensure that people who have signed applications are genuine and have made that certification which it is claimed they have made. That, too, will enable abuse to be minimised.
  Mr. McNamara: Can the hon. Gentleman deal with the method of counting before he leaves the points I made?
  Mr. Howell: I do not wish to elaborate on the method of counting, except to say that there will be central counting and that this will be done in the way described. The hon. Gentleman mentioned the dangers of a particular incident where a ballot box might be upset. I hope that he will be reassured that, if there are, as it is intended that there should be, a large number of observers at the count as well as at the polling stations, there will be safeguards. The hon. Gentleman may not be reassured, but the Government believe that with observers and the security provisions provided there is an adequate opportunity to ensure that these dangers are minimised.
  There are a number of other issues, about which I will write to hon. Members. A great deal of publicity will follow to ensure that there is wide understanding of the considerable opportunities for almost everyone in Northern Ireland who wishes to do so to vote, either by post or in person, and I believe that this will enable a large poll to be registered and to be carried out in a helpful and democratic manner.
  Mr. Merlyn Rees: There is concern about the Queen's University research project. To allay all the fears about it, will the hon. Gentleman make it clear that the report shall be to the Secretary of State and that there will be no publication, other than through the Secretary of State and to the House, before any decision is made about what happens to the material afterwards?
  Mr. Howell: That worry has been expressed tonight. I assure the hon. Gentleman that any report made will be through my right hon. Friend.
  Question put and agreed to.
  Resolved,
  That the Northern Ireland (Border Poll) Order 1972, a draft of which was laid before this House on 14th December, be approved.

  PRIVILEGES
  Ordered,
  That Mr. Duncan Sandys be discharged from the Committee of Privileges and that Mr. Edward du Cann be added.—[Mr. Weatherill.]

  ADJOURNMENT
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Weatherill.]

  ANGEL INTERSECTION, ISLINGTON
  1.26 a.m.
  Mr. George Cunningham: For some months the Secretary of State for the Environment has had before him proposals for the construction of a new traffic circle at the Angel in Islington, and his approval to those proposals from the Greater London Council is required. I understand that his decision will be given one way or the other in the near future. I have been trying for some time to have a short debate like this on the proposals because they are causing deep concern amongst a large number of individuals and organisations in my constituency. Tonight I shall press upon the Minister a number of considerations some of which the Department may have heard before and some of which it will not have heard before. I hope that these proposals will be seriously considered before the Minister reaches his decision.
  It will be an important decision because the Department will be providing 75 per cent. of the capital costs of the operation, and that is likely to come to a very high figure. Therefore, the Department cannot be content to leave it that the GLC is satisfied with the proposal and that it ought to be all right. The Minister must go into it properly and satisfy himself that the proposal makes sense.
  There is great confusion about many points in relation to the proposed roundabout. I hope that the Minister can make clear just where things stand within the Department. I have stated what I understand to be the position about ministerial approval, but there is doubt about it. Representatives of the Greater London Council have let it be known that in their opinion the Department has got the cost of this proposal into its firm financial programme for 1977. I want to know what that means. Is there any commitment at this moment

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  on the part of the Department to approve the scheme? That is typical of a number of confusions which there have been about the scheme.
  I hope that the Minister will bear with me while I refer to a rather technical point. It relates to new ideas on the shape and size of roundabouts which emerged from the Transport and Road Research Laboratory, which is a direct responsibility of the Department.
  The proposal at the Angel is for an enormous roundabout, the central island of which will be an acre or perhaps 1.1 acres in area. It will be surrounded by a relatively narrow carriageway of 20 yards—relatively narrow, that is, in relation to the central island. In late 1970, the Transport and Road Research Laboratory brought out a valuable report—No. 356—by F. C. Blackmore on the capacity of single-level intersections. Briefly, the conclusion reached was that several traffic experiments had shown that the capacity of roundabouts of conventional design—that is, with a fairly large central island and a relatively narrow circulating road around it—could be improved by reducing the diameter of the central island by about one-third while maintaining the diameter of the border perimeter. By this means, the capacity of any roundabout could be improved.
  That conclusion was based not just on a few traffic experiments but also on the study of a number of road conditions. It was a firm conclusion of the report that the old idea of a huge central island was bad. It got a good deal of publicity at the time and as a result a number of changes have been made in London roundabouts.
  The roundabout at the Angel is a fine example of the shape of a scheme which pre-dates the ideas put forward by the TRRL. When the TRRL studied a roundabout at Hillingdon—it happened to be one with four carriageways running into it, like the Angel—it found that it got the best results with an island of 15 metres in diameter within a larger circle of 46 metres in diameter. That is, the central island bore a relationship of one to three to the outer circle. The TRRL said that the ratio could have been smaller if it had been able to design the entrances and exits to the roundabout, as it could do with a totally fresh plan, as proposed at the Angel.
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  I want to know first whether the GLC referred its plan, which was certainly dreamed up before the TRRL came out with its ideas, to the TRRL at any stage. Secondly, has the Department referred the plan to the TRRL? Here, the Department has its own research establishment exactly for such a purpose. The TRRL is not there just to dream up general plans and reach general conclusions. It is invited to comment on specific plans by some local authorities, and, therefore, the Department is free to refer a specific case to it if it wishes. Has it done so in this case? If not, why not, in the light of the clear conflict between the proposal at the Angel and the conclusions of its own subordinate body, the TRRL?
  I am not suggesting that we should reduce the size of the central island at the Angel and increase the capacity of the roundabout. What I am suggesting is that we should keep the proposed capacity static, if it has to be at that level at all, reduce the size of the central island and reduce the size of the outer circle. That would save, I calculate, an acre or more of the area from the devastation which will otherwise strike it.
  What is the cost of the scheme? Figures are bandied about of £7 million, £7½ million, £9 million. What will be the cost of stage A—that is, without the proposed underpass, which is to follow in 20 years' time? What will be the cost of stage B, including the underpass? Therefore, what will be a 75 per cent. share of that which will fall upon Exchequer funds?
  A number of other questions have been raised about the rationalisation of this proposal. First, is it designed to take the expected expansion in traffic flows which was predicted nearly a decade ago by the London Transport survey? Certainly that was shadowed out a few years ago. But the current explanation and rationale appears to be that it will not do that. It will apparently now merely take the traffic which comes through the Angel and also traffic from the rat-runs which surround the Angel and which should go through it. There is confusion on that point. I hope that the Department will clear it up before reaching a decision.
  How much of that traffic is divertable to the Angel anyway? It is no good simply putting a man on the street and

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  taking a count of the vehicles passing. Not all of those vehicles can be diverted to the Angel even if there is a traffic management scheme which will create an incentive to achieve it, and even if the capacity of the Angel is improved. Will the Minister say whether there have been studies by the GLC, the Department or anyone else to see how much of that rat-run traffic can in practice be diverted into an improved Angel intersection?
  I have heard it said by the chairman of the appropriate GLC committee that if the scheme at the Angel was made less ambitious the Department of the Environment would turn miserly and not provide the 75 per cent. grant. I cannot believe that there is any truth in that, but will the Under-Secretary confirm or deny it? The Department is now looking at the scheme, as I understand it, and if it gives its approval to it, surely the 75 per cent. grant would automatically become available.
  It is completely unknown at this stage whether the southern junction of Liverpool Road will be closed. That junction is only about 100 yards from the proposed roundabout, even in its present location, and a good deal less than that from where the entrance will later be situated. Here again is an important point which has not yet been dealt with, and the Department should not take its decision before it is resolved.
  There are, of course, difficulties if the Angel is developed in this way. There will be consequences for Kings Cross, Euston Road and Highbury Corner and for other linkways east and west across the York Way. Experience in London and elsewhere in recent years is that all that happens when the capacity of an important junction is improved is that six traffic jams are created on the surrounding roads. Unless the authorities are prepared to impose restraints upon traffic, that is what will happen at the Angel.
  I have mentioned but a few points to illustrate the confusion that exists not only among my constituents but in the minds of those who are responsible for putting the scheme forward. My constituents have approached the matter in a very workmanlike way. They have set up committees and used bodies like the Islington Society, which is opposed to the scheme. They have had discussions with the appropriate
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  officials and the elected representatives on the GLC. The confusion which exists on the points I have mentioned results from these discussions and was not removed by them.
  The important considerations to be taken into account are those deriving from the changing attitudes in this House and in most authorities, and, I hope, in the Department of the Environment, towards the question of urban transport. Last week we had the Expenditure Committee's report on urban transport. I was happy to be a member of the sub-committee which produced that report. We had the Prime Minister's little walk to 10 Downing Street, and earlier last year we had the GLC document "Traffic and the Environment" which was obviously produced by a totally different set of people from those who produced the design for the Angel.
  We have had the occasional comments of Sir Richard Way, Chairman of London Transport, who feels strongly that some considerable reduction—about 40 per cent.—should be made in car usage if we are to have a decent bus service in London. There is developing—fully developed even—what might be called a new orthodoxy in urban transport philosophy, which is that we have to have restraints on the commuter travel at peak hours in city centres combined with improvements in public transport—and we cannot have one without the other. It is part of that new orthodoxy that the improvement of urban roadways in itself will create far more problems than it will solve.
  I remind the Minister of the degree of urgency which the Expenditure Committee attached to these fundamental matters. We said in paragraph 11:
  "There is a growing feeling that unless positive policy decisions are taken in the near future we may be faced with irreparable social and environmental damage and the breakdown of public transport facilities."
  We were pleading not only that this should be accepted in theory but that something should be done and done quickly. Otherwise London will become even more of an asphalt jungle than it is now.
  A more apposite recommendation is contained in paragraph 107, where we said:
  "we … recommend that, as an urgent priority, all trunk and principal road schemes

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  of urban road building which have not reached the exchange of contract stage should be re-examined ab initio."
  Road proposals take an awful long time in gestation. If we adopt a new road policy and apply that policy only to the plans which are but a twinkle in someone's eye, it will be half a century before we get any concrete on the ground in accordance with the new ideas. What has to be done now is to re-assess the plans which are not yet confirmed and started and try to moderate those in line with that new policy. That policy will provide for better public transport, more bus lanes and a restraint upon the use of the motor car by commuters at peak hours in city centres.
  If we do that, it is highly questionable whether we need an increase in the capacity at the Angel of the order intended. I stress that I am saying not only that we do not need that increased capacity but that, even if we want it, there is a way of doing it by a smaller scheme, which will use less land than the one proposed.
  We would be very disappointed in Islington—certainly this is the case with the Islington Borough Council—if there were to be a further prolonged period of delay in settling these matters. There is no need for that. I would like the Minister to say that this scheme is too ambitious, that he wants a more modest scheme, and that he wants to get it buttoned up this year. The GLC claims it would take five years to work out something new. That is nonsense. I hope that the Minister can say, when he takes his decision, that he will not approve this but will approve a more modest scheme, and that he wants it to go ahead rapidly so that the land freed from planning blight can be used for important housing purposes in Islington.
  1.45 a.m.
  The Under-Secretary of State for the Environment (Mr. Keith Speed): I thank the hon. Member for Islington, South-West (Mr. George Cunningham) for introducing this debate at this late hour. I will do my best, but I cannot answer all his questions. I reaffirm that no formal decision has yet been taken. I will certainly look at the hon. Gentleman's remarks, and I have no doubt that the Greater London Council will also do so.
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  I will first outline the topography so that we are all clear exactly what we are talking about. The routes converging on the Angel intersection are the Al—Goswell Road, Islington High Street, Upper Street—and the A501—City Road, Pentonville Road. Traffic also reaches the intersection from the A401—Rosebery Avenue—and the A104—Essex Road. These are metropolitan routes for which the GLC is the highway and traffic authority.
  The Al is a radial route and is a main road to the north connecting directly to the Ml. In the past, this route has been improved in the Holloway Road, and is currently being improved in the southern part of Archway Road. Draft orders are about to be published for the improvement of the remaining length of Archway Road.
  The A501 which crosses the Al at the Angel is part of the inner ring road around the West End and the City, terminating at its western end with the Western Avenue Extension, the A40 radial route. The hon. Gentleman referred to the effects this will have way beyond the Angel. At its eastern end it feeds into the A13. One can see how the Angel is thus a major interchange and the traffic movements at this point are extremely complex. There is no difference between us on that.
  In view of the current measures proposed by the GLC for controlling the passage of long vehicles through six square miles of central London, use of this major east-west distributor road for the central area is likely to increase.
  Delays and congestions both in and out of peak hours have been the feature of the Angel intersection for many years. In a study of delay times taken in 1969, delays of over seven minutes were recorded. A more recent study taken in July 1971 for a proposed southbound bus lane in Upper Street gave an average delay to buses in the morning peak of four minutes, with the longest recorded on the day of the study of nine minutes. Also in July 1971 in Upper Street a peak hour queue length of 2,400 ft and off-peak length of 1,400 ft were recorded. This affects peak-hour traffic and buses.
  As a result of this congestion, many drivers avoid the junction and take diversionary routes through adjoining residential areas, including three conservation

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  areas around the Angel. Traffic flows have resulted along such roads as White Lion Street, Duncan Street, St. Peter's Street, and Colebrook Row. Other major flows bypass the area altogether; for example, the flow of traffic using Liverpool Road was estimated by the GLC to be as much as the parallel metropolitan road, Upper Street.
  These considerable subsidiary flows which have built up penetrate the adjacent residential areas whose quality has been recognised by their designation as conservation areas. Their design includes provision for directing these flows on major routes to bypass the Angel. The proposals do not envisage a reduction of traffic on roads such as Amwell Street and Liverpool Road, which carry heavy flows through residential areas.
  What the hon. Gentleman did not refer to is the accident record in the neighbourhood of the Angel intersection which gives cause for concern. Over the three years between 1969 and 1971, 87 accidents were recorded involving personal injury. Over the same period five people were killed and 50 sustained serious injuries. One cannot ignore these figures.
  In view of the difficulties being encountered at this intersection, the former London County Council in 1959 approved in principle the provision of a roundabout to improve the situation at this point. Pending agreement on the precise form of the improvement, traffic management measures have been progressively introduced since that time both to alleviate congestion and to improve the safety of the intersection. Waiting restrictions were introduced in 1960, a one-way scheme in 1963 and further banned turns and signal improvements in 1968. The number of turning movements at the intersection requires lengthy cycles at the traffic signals which control the flows. In spite of what has been accomplished, congestion persists and there are road safety problems.
  Mr. Cunningham: While the Angel is one of the 100 intersections in London where there can be delays for buses of more than five minutes, will the hon. Gentleman not agree that those counts were taken before the introduction of bus lanes and that the Angel is by no means
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  in the top range of the worst intersections?
  Mr. Speed: I would not say that it was in the top range of the worst intersections, but I am sure the hon. Gentleman will not argue that it is a satisfactory situation. I shall say something about bus lanes in a moment, because the GLC is making considerable strides in that respect.
  Concurrently with the introduction of traffic management measures and stemming from proposals mooted by the LCC in 1959 for improvement works at this junction, more than 20 alternative schemes or variations have been considered by the GLC. The realignments involved were, however, extremely costly or intrusive on amenity or conservation areas. The larger gyratory systems considered were also expensive and presented problems of integration with the likely redevelopment.
  The present proposals have resulted from a decision by the GLC in 1968 to set up a working party with the Islington Borough Council. From its discussions has emerged a scheme comprising a large roundabout at the main intersection with pedestrian subways connecting from all sides to a central sunken area within the roundabout. A further pedestrian subway is proposed at the improved intersection of Islington High Street and Liverpool Road. This intersection will be bypassed by a southbound "bus only" lane from Upper Street into Islington High Street. Bus lay-bys have been provided in the proposals to obtain maximum advantage from the traffic capacity of the roundabout.
  The hon. Gentleman asked about cost. The cost of this scheme has been estimated by the GLC to be about f6¾ million, of which our share, if the scheme went ahead, would be about £5 million. I hope that will give the hon. Gentleman and his constituents some information to work on.
  The improvement includes widening to deal with the Liverpool Road junction and the St. John Street/Rosebery Avenue junction. Goswell Road will be made into a cul-de-sac south-east of the main intersection, and traffic will be diverted to St. John Street. The east end of Myddelton Street will be closed at St.

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  John Street, and a signalled intersection provided at St. John Street/Spencer Street junction to encourage use of Goswell Road. The existing zebra crossing opposite Owen's School will be made safer by the provision of traffic signal control. The GLC proposals for the roundabout are designed to take the capacity of the existing roads as a constraint on the traffic growth. Provision will be made at the roundabout for an east-west underpass at a later stage should this be necessary. The design would also permit a north-south underpass at a later date if needed, but this is very much in the future.
  Although the road engineering of the improvement has been designed to be independent of redevelopment proposals, considerable traffic and environmental advantage could be gained in the future as the adjacent property redevelopment schemes mature. I understand that the London Borough of Islington is considering the diversion of Liverpool Road as part of major redevelopment, while London Transport is investigating ways of improving the Angel Underground Station. Over the years planning blight has occurred throughout the area likely to be affected by the scheme and many properties are boarded up. The implementation of this or something like it should bring considerable improvement to the environment of the whole area.
  The hon. Gentleman suggested that consideration of these proposals should be deferred pending reconsideration of London's traffic problems in the light of the report of the Expenditure Committee on urban transport planning. We are taking the report very seriously, but it has only just come out and needs careful reading and a lot of thought. However, I do not think we can freeze everything on the basis of that report at this point in time, because one wants this year to come to some sort of conclusion. There is considerable concern among the hon. Gentleman's constituents and many others concerned with the area that after more than a decade of indecision we must try to take some decision in the very near future.
  Mr. Cunningham: Is the hon. Gentleman going to say anything about the Transport and Road Research Laboratory?
  Mr. Speed: I will come to the two particular points which the hon. Member raised.
  The first, which is very important, is that no formal decision has yet been taken by my right hon. Friend. Entry of this scheme to the programme, if my right hon. Friend said that the scheme could not go into the firm programme, would not of itself guarantee that the improvements will be carried out even in part. It would simply give sufficient assurance to the GLC that it has the Government's support in principle for proceeding with detailed design of the scheme to the point where steps will have to be taken to acquire the necessary land—a process which almost inevitably would require a public inquiry. If the decision on a firm programme were taken, I guess that the public inquiry would take place next year, and there would be no question of any construction until 1977. I cannot see a public inquiry being held before next year if the decision were taken to go ahead. A public inquiry would provide the opportunity for further public comment, as regards both the actual appearance and the effect of the proposed works on the neighbourhood.
  The hon. Gentleman made some interesting points about the TRRL report. I cannot give him an answer now. I will let him know whether the scheme was referred to in that report. My officers and experts in evaluating the scheme will give advice to my right hon. Friend on whether it should appear in the programme, and will take very much into account——
  The Question having been proposed after Ten o'clock on Tuesday evening, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
  Adjourned at four minutes to Two o'clock.