HC Deb 23 July 1975 vol 896 cc531-2
5. Mr. Michael Latham

asked the Secretary of State for the Environment upon what evidence he bases his calculation that there is likely to be some recovery in new construction output in 1976 compared with 1975.

The Secretary of State for the Environment (Mr. Anthony Crosland)

My expectation of some recovery in new construction output in 1976 is based on my view of the economic situation as a whole.

Mr. Latham

I declare an interest in the industry. Since the latest NEDC survey shows a sharp fall in council housing starts next year, and since all independent forecasts of construction next year foreshadow a quite deplorable situation, is it not obvious that the Secretary of State has no policy for the industry which he is supposed to sponsor?

Mr. Crosland

This is a matter on which no two forecasters will ever agree and in which forecasting involves a very large subjective element. I base my figures for house building upon the fact that in the public sector dwellings in new contracts let by public authorities are up by 19 per cent. in the first five months of this year compared with the same period last year. In the private sector, starts for the last three months are 19 per cent. up on the previous three months, and these two figures suggest a return of confidence.

Mr. Frank Allaun

Whatever the pressure for cuts in public expenditure from either the Treasury or from Conservative MPs, will the Secretary of State resist making reductions in the house building and improvement programme and, instead, press for expansion?

Mr. Crosland

I shall do the best I can to satisfy my hon. Friend on both points.

Mr. Raison

In a climate of no growth, real public expenditure restraint, cash limits and real income restraint, how can the Secretary of State possibly expect to see an increase in construction next year?

Mr. Crosland

This depends on the judgment which the hon. Gentleman makes, which I make, which NEDO makes and which other forecasters make on the likely construction scene next year. It is not disputed that there will be a fall in construction this year compared with last year. I and my Department feel that next year there may be a modest recovery. NEDO takes a more pessimistic view than that. Those are the forecasts, and we shall see who is right—but I take a more robust view of the situation than NEDO does.

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