HC Deb 02 April 1974 vol 871 cc1219-30

9.58 p.m.

Mr. Robert Cooke (Bristol, West)

I hope I shall not try your patience in the time that remains, Mr. Deputy Speaker. You have been good enough to listen to us on the subject of the Clifton Suspension Bridge which, while a matter of national importance, also has considerable local interest.

I hope the Minister will reply to certain remarks I shall make about the problems of homes to let. In certain areas there is a great shortage of such accommodation and the construction of new houses cannot remedy it in the foreseeable future. Not all of those who are seeking homes want to buy them. A large number of young people want to retain their mobility, perhaps because they are seeking promotion in their employment and must be prepared to move about the country.

If they are limited to buying a house because they cannot rent, they may be saddled with an investment which they could not realise if they were called upon suddenly to move. They will be faced with a difficult choice. A young man may have bought the house on a mortgage and may be paying a high rate of interest. He will probably find that the value of the house has declined, in common with other property values recently. He will either have to refuse the promotion and stay where he is, perhaps missing a once-in-a-lifetime chance—

It being Ten o'clock, the Motion for the Adjournment of the House lapsed, without Question put.

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

Mr. Cooke

The young man has the terrible dilemma of passing up the promotion or selling this major asset at a loss. He may try to let the house, but if he lets it unfurnished he can be stuck with a tenant he cannot get rid of. I see the Under-Secretary nodding his head in assent. It is clear, therefore, that not all the young people, or, for that matter, older people, want to buy. Many circumstances indicate that renting would be preferable. The choice is to rent from the council, and there is always a heavy demand there, or to rent from the private sector. The stock in the private sector has greatly declined over the last 10 or 15 years because successive Governments have never been able Quite to come to terms with this aspect of the housing situation.

After what happened at the General Election I am not surprised that my party was cautious in saying anything about the matter. Just before the election I had managed to get my party unanimously in favour of helping the private rented sector by making it easier for an owner-occupier with surplus rooms in his house to let those rooms for the first time. That would not have applied if the rooms had been previously let. If a tenant were already in occupation the position would not have been disturbed. The idea was not to apply to any existing secure tenant The scheme was to apply to spare accommodation in owner-occupied homes in which the owner would be prepared to let accommodation to another family provided that he could retain control of his home.

The idea was that an owner and a potential tenant could enter into a lease, which would be freely entered into by both sides, so that the parties would know where they were for a year, two years or more, and that at the end of the term the owner-occupier would know that he would get back his home. It is because at present the owner-occupier knows that if he lets he may well be stuck with a tenant who turns out not to be a success, who might become the bane of his life, and that he will never be able to shift him, that a tremendous number of potential homes is withheld from the market. I estimate that approximately I million potential homes for rent could be produced by making it easier for the owner-occupier to make his contribution in the present conditions of shortage.

So far no one has denied my estimate. Nobody has quarrelled with it. The previous Government and the previous Opposition had the opportunity to do so but they could not produce any figures to quarrel with mine. The sad situation is that the present Government, after the election, made certain noises in the direction of furnished lettings. I am talking about the unfurnished sector. Those noises will make people disinclined to let furnished accommodation if they think that they will never be able to regain possession. A further 1 million homes will he locked up by the attitude of the present Government.

I ask the Government to think again and to consider whether they want to achieve a position in which owner-occupiers may be less anxious to take people into their houses, although they would be pleased to do so if they knew that they could retain control of their own homes. There is surely nothing wrong in owner-occupiers being able to retain control. I am not talking about property developers, property speculators or landlords in the true sense of the word who might own a block of flats or a large amount of property. I am talking about the owner-occupier who is letting to people for the first time. I believe that he should be given a chance to make his contribution.

It is in the areas of the greatest need that there is the greatest potential. Any hon. Member who represents the residential part or the industrial part of a great provincial city knows that there are houses which are occupied by a couple whose family has grown up and gone away or by single ladies living alone in houses far too big for them. In the same street there may be young couples who are about to be married, or who have been married, who are walking up and down the street desperately trying to find somewhere to live. Ugly social pressures could build up, and in some areas they are building up, because the present state of the law makes it impossible for those who would like to welcome in potential tenants in fact to do so.

I have already referred to the misunderstandings which exist. I am afraid that some of them are deliberately whipped up for rather strange political reasons. I suppose that all is fair at a General Election. Many people get carried away and say things which cannot be backed up by the facts. However, I think that it is going a bit far for the present Secretary of State for the Environment, in a Press release published by the Labour Party Information Department, Transport House, when commenting on a proposal in the Conservative election manifesto, to say One alarming proposal has got into the Tory Election Manifesto. They are threatening to remove security of tenure from unfurnished tenants whose landlord lives in the same house. Now, of course, it may be that the right hon. Gentleman had heard some garbled version of what we were proposing. In that case, I suppose that he might be exonerated. But surely not. He is a Privy Councillor and had previously been a Secretary of State. He would surely have checked his facts.

I think that the right hon. Gentleman was tempted, in the heat of the election, to comment on what he supposed some people would think we were talking about I ask the Under-Secretary of State to have a word with the right hon. Gentleman so that there may be no misunderstanding. We on this side of the House realise that housing is a most delicate matter and that there must be security of tenure for those who have lived in a place for a long time and are now perhaps old, unable to pay more and would find it difficult to get anywhere else to live. Of course their security must be jealously guarded, even though on many occasions the tenant has it all his own way and the owner may be in grave difficulty.

I have such a case. It is that of an old lady who has a heart condition. She lives at the top of her house and would dearly love to move down. But she cannot shift the protected tenant who lives downstairs. It is a sad situation.

But we were not proposing to do anything about such a situation in our manifesto, and when the right hon. Gentleman claimed that, as a result of our proposals, many tenants would be thrown on the streets, he was going too far.

But now we are away from the election fever and I hope that both sides of the House can reach some agreement on this matter. We strongly adhere to what was clearly stated in the Conservative manifesto. We believe that when an owner-occupier wants to make a contribution, nothing should stand in his way. Of course, we could hedge the arrangement round in one way or another. If it were done by agreement or lease between owner-occupier and tenant, it could be supervised. Perhaps even the rent could be agreed and supervised by some public body which already exists under the law. But in the long run, with more and more freedom, rents would find a fair level of their own. However, at the outset it might well be advantageous to let the existing machinery supervise these new arrangements. We would not quarrel with that.

I do not suppose that I need quote much more evidence in support of my case. I have had many letters on the subject since the election. The Government made noises about furnished tenancies, which suggest that more and more people will not again let accommodation which becomes available. They will not have anyone in unless they can be sure at the end of a lease or agreement of being able to see the back of them. They would not want to repeat the bitter experience of so many people who have let accommodation.

Surely all parties must do their best to co-operate in this matter. I know that the Labour Party has an inborn hatred of landlords. Of course there were very bad landlords indeed, but I am not talking about landlords. One cannot call the owner-occupier who is prepared to share his home with one other family, or perhaps, if it is a big house, two families, a landlord. I would not extend that beyond two or give any special concessions to somebody who has bought a big house and divides it into a dozen small units. I am referring to a genuine owner-occupier with a house which is slightly too big. It is up to the Government to work out the detail because they have all the apparatus.

Let us get away from the fearful idea that all landlords are wicked, because they are not, or that the landlord image comes into this matter. We shall not, with the best will in the world, solve our housing problem by new construction. The resources do not exist. If the present Government said that they would build 500,000 houses in a year they could do it only at the expense of not building the roads and hospitals we need, and of cutting back on schools. Only so much construction can be done in a year. The hon. Member knows a lot about that because, although we violently disagree on many political things, he has great experience on housing matters. I am sure he is giving my suggestion serious thought.

We cannot deal with the matter simply by new building. There is a tremendous untapped pool of potential accommodation, so why not give the idea that I am putting forward a chance? I do not believe it would do any damage to the housing market by giving it a chance. I believe that this idea would produce a million extra homes to let within a very short time. This is something that cuts right across party politics. Let us forget politics for a while and give the idea a try

10.13 p.m.

The Under-Secretary of State for the Environment (Mr. Gerald Kaufman)

I congratulate the hon. Member for Bristol, West (Mr. Cooke) on choosing such a timely and important subject for debate and for allowing us to have our first housing debate in this Parliament. The hon. Gentleman has boldly stepped in where the Opposition Front Bench, very understandably, feared to tread.

As the hon. Gentleman knows, the present Government strongly support and encourage home ownership and will take every step open to them to advance home ownership. As the hon. Member recognises, however—this indeed is the burden of what he said this evening—for millions of families home ownership may be out of range or it may not suit their special requirements, perhaps their working requirements.

As a result, today, despite the increasing demand for home ownership, pretty well half the households in this country are still tenants of one kind or another. But, as the hon. Gentleman also pointed out, although demand for rented property is maintained, certainly keenly always—and sometimes, both in the hon. Member's experience and in mine as constituency Members, heart-rendingly—supply is not meeting demand.

Under the previous Government the number of rented dwellings was far from sufficient for needs. The hon. Gentleman pointed out that the amount of privately rented property was decreasing. The sad fact is that over the past few years the decline in the privately rented sector has not been matched, let alone exceeded, by an increase in local authority accommodation.

During the Conservative Government's period of office the number of rented dwellings, taking public authorities and private landlords combined, actually fell by nearly 90,000. In 1972 for example, the latest year for which we have statistics, the number of new buildings provided by local authorities for new tenants was a measly 56,000.

Apart from the special considerations which the hon. Gentleman has advanced —both in debate and at Question Time in the previous Parliament—that is why he has consistently advocated the expansion of furnished lettings as a way of helping to deal with this problem. He has put forward his case with such statistics as he has been able to obtain, and he believes, in particular, that there is considerable under-occupation among owner-occupiers which could be used to help meet the need that he describes. The hon. Gentleman has advanced his case in every way open to him. During the debate on the Consolidated Fund Bill he made the point that he believed that there were glimmers of light peeping through the stone wall of my Department.

The hon. Gentleman also believes—he said so again tonight—that owner-occupiers are discouraged from making available the kind of accommodation that could help to meet the problem because of the restrictions that are placed upon landlords of furnished accommodation by legislation to protect tenants in such accommodation.

The hon. Gentleman is particularly concerned about the legislation that we announced in the Queen's Speech, by which we plan to provide security of tenure for furnished tenants. I take it from his remarks this evening that he believe that the legislation that we are in the course of proposing in fulfilment both of our election pledge and of our commitment in the Queen Speech will act as a further deterrent to making available the kind of accommodation that the hon. Gentleman advocates and that he believes will help to solve the problem he describes.

Mr. Robert Cooke

The hon. Gentleman has not quite got it right. He spoke of furnished accommodation. I was referring to the situation where owner-occupiers have a few rooms, perhaps at the top of the house, that they would he happy to let unfurnished. After all, having collected their wedding presents and furniture, young people want to use them. It is the owners of unfurnished accommodation who at present get caught by the existing law. There is no incentive whatever to let, as tenants cannot be evicted. That was the point about which I made such a fuss. I said further that the present Government, judging from the Queen's Speech and their election manifesto, will now place a further disincentive on anyone who wishes to let furnished, because once a tenant is in accommodation he cannot be got out. There are two sides to this matter.

Mr. Kaufman

I accept the hon. Gentleman's remarks. The people who he believes have under-occupied property would be ready to let it unfurnished if legislation were not restrictive—in his view the legislation is restrictive—but they would let furnished accommodation, as a second-best perhaps, provided that they were not let in for more than they felt able to take on. The hon. Gentleman regards the legislation which we shall bring in soon as a further disincentive to the people he has in mind to make this type of accommodation available. While we are determined to bring in this legislation, and while it is not possible to forecast the details of the provisions now being worked out, it can be said—and I readily volunteer this to the hon. Gentleman—that the case for allowing exemptions in certain circumstances is being closely studied. We shall have to wait for the legislation itself, which I cannot anticipate.

The special position of owner-occupiers letting their own homes while temporarily absent and of people letting part of their own homes will be borne in mind. But I am sure the hon. Gentleman will not be satisfied even with this. I assume, from the speeches in the campaign which he waged in the last Parliament, before this legislation was on the horizon, that his aim was to remove some of the existing restrictions in order to make it possible for the people he has in mind to make accommodation available.

I have tried to be helpful so far, but I must tell the hon. Gentleman that this would not be acceptable to the present Government. It may be true—and I do not quarrel with the hon. Gentleman in his assumption, for the sake of argument —that more furnished accommodation would be made available if restrictions were fewer. But it is fair to ask in that circumstance: what would be the position of the tenant? Tenants of furnished accommodation in too many cases already live in constant fear of eviction.

The hon. Gentleman spoke, in advocating his cause, of rents finding their own level, but certainly in many cases now tenants of furnished accommodation are often paying an excessive rent. One hears of the most monstrous rents in the London area, for example, with the tenants accepting the situation rather than making trouble, which could result in eviction.

If the most elementary protection for tenants means a slackening of the growth in the furnished sector, we on this side must accept that and we believe that homes to let must instead be provided in other ways.

Mr. Robert Cooke

The hon. Gentleman keeps harking on about this question of the furnished tenant. The Department knows all about what I was arguing and must have advised him, and he knew because he must have heard some of the things that I said in the last Parliament. The Department knows that the main source of supply, the untapped wealth, the 1 million potential homes, lies in the owner-occupier who has spare rooms at the top of the house or in some other part of his house which he would be prepared to let unfurnished. It is because the present law would give an unfurnished tenant absolute security and the owner of the house would never be sure when that tenant would be out—or if they had an agreement for a year he would never be sure of getting him out—that the owner will not let. What I have advocated to the hon. Member is that in that circumstance the house-owner should be able to enter into a freely agreed lease with a potential tenant. It could be policed by the hon. Gentleman's police force in the shape of the rent officers and all the rest of it. That surely gives absolute justice to both sides. What will he do to unlock this potential 1 million homes which otherwise will remain locked up?

Mr. Kaufman

I fear that I must disappoint the hon. Gentleman. I have said that we must—not just must, but are determined to—go ahead with our legislation to provide security of tenure for furnished tenants. I am afraid that, even with the kind of safeguards he proposes, we certainly cannot at this stage go back on security of tenure for unfurnished tenants.

The hon. Gentleman made much of under-occupation among owner-occupiers. He called it a tremendous fund of accommodation. It is true that among owner-occupiers 40 per cent. of dwellings are at a density of less than one person to two rooms, but we have no way of knowing whether the hon. Gentleman's estimate is accurate. I do not quarrel with him about it, but there is no way of knowing how many of those owner-occupiers wish to let part of their homes.

It is an interesting fact that under-occupation is almost exactly the same in the privately rented unfurnished sector, for which the figure is 39.5 per cent., compared with 40 per cent. among owner-occupiers. All those homes by definition are available for letting. While they remain at random in private hands, a sensible allocation to people who need the dwellings according to the space they require cannot be achieved.

In any case, massive repair and renovation are needed, for 22.9 per cent, of privately tenanted housing stock is unfit. It makes up 60 per cent. of all occupied unfit dwellings, while 30.1 per cent. of private tenanted dwellings are in need of more than £500-worth of repairs. I grant that it is four times as many as in the owner-occupied sector, but it is 14 times as many as in the council house sector.

I went round my constituency on Saturday and saw private landlord dwellings riddled with damp, reeking of neglect, and where the landlord seemed completely uninterested in housing tenants adequately, and where the tenants were growing frantic because of this neglect and their inability to lead satisfactory family lives. Despite the obvious sincerity with which the hon. Gentleman advocates his case, it is our view that local authorities, with all their shortcomings—which I am the first to accept —are the only bodies equipped to do the job of providing rented accommodation on a large scale as well as achieving a rational allocation of tenancies, even though, again, I should be the first to agree that even local authorities do not always achieve that.

In our view, municipalisation is vital for the decent housing of the people. The provision of new tenanted property by the public sector is equally important. Without wishing to introduce too partisan a note into a debate of this nature, I must point out that the last administration woefully failed to provide such accommodation, with the worst number of starts and completions last year for over a quarter of a century.

We shall tackle the problem in two ways. First, we shall consider new legislation which, with the new grant system, will make finance available through the Housing Corporation to housing association schemes as well as enabling the Housing Corporation to build on its own account. Both these projects will assist in catering for the kind of specialised needs which the hon. Gentleman quite rightly says must be provided for. This is the unique and valuable rôle of the housing associations.

But I return to my insistence that the main job on a large scale can be done only by local authorities building enough houses for rent. That is why my right hon. Friend the Chancellor of the Exchequer announced last week that he is making £200 million available this year for extra local authority building, plus acquisitions from private developers, which will also in their turn increase the stock to rent.

I thank the hon. Member for Bristol, West sincerely for raising this supremely important topic of providing homes for rent. The Government may not be tackling the problem in quite the way that he would wish, but I assure him that we are tackling it with more determination than it has ever been approached before.

Question put and agreed to.

Adjourned accordingly at twenty-eight minutes past Ten o'clock.