HC Deb 11 June 1975 vol 893 cc395-9
14. Mr. William Hamilton

asked the Secretary of State for the Environment what new plans he has for the financing of local authority house building.

Mr. Crosland

This is one of the matters which is being considered in the comprehensive review of housing finance which I am now undertaking.

Mr. Hamilton

Does my right hon. Friend recall that in our election manifesto we said that housing subsidies would be increased to the point where they were equal to the tax concessions given to owner-occupiers? Since that is not a practical possibility either now or in the foreseeable future, will my right hon. Friend divert his attention to the build- ing of timber frame houses, for instance, which I have advocated in this House for some time, on the ground that they would be much less expensive than the prohibitive prices now being asked of local authorities, and also much quicker to build?

Mr. Crosland

The total subsidies to local authority housing have roughly doubled in the last two or three years.

I strongly agree with my hon. Friend about timber frame houses. There are a number in my constituency. They are extremely popular and, as my hon. Friend said, quicker to build than traditional houses. My hon. Friend will have noticed that in our most recent circular, "Housing Needs and Action", we have attempted to give a further boost to the sensible use of systems like the one that he has in mind.

Mr. Fry

Does the Secretary of State agree that due to the high cost of subsidies and the enormous length of loans that local authorities have to take for local authority building there is no hope whatsover of solving our housing problems through local authority house building alone? Would it not be honest of the right hon. Gentleman to say so and to take more direct steps to assist the many people who would rather buy their own homes than rent them permanently?

Mr. Crosland

If I may say so, that was a particularly stupid question. The hon. Gentleman must know perfectly well that no one on the Government side of the House has ever suggested that our housing problems could be solved solely by local authority housing. Further, the hon. Gentleman must know that this Government have taken a number of crucial actions—as anybody in the private house building industry will tell him—such as the loan to the building societies and other measures, in an attempt to boost the private house building programme.

Mr. Gwilym Roberts

Does my right hon. Friend agree that local authority house building has an enormous contribution to make in solving our housing problems? Does he accept that we can never solve our house building problems unless we have a new form of borrowing for local authorities which is much cheaper than they are able to obtain at present?

Mr. Crosland

Perhaps I may make a major statement on the Government's housing policy. We believe that both local authority and private house building have a critical part to play in solving our housing problems.

Mr. Raison

Does the Secretary of State accept that the question posed by my hon. Friend the Member for Wellingborough (Mr. Fry) was in fact extremely pertinent? While there is an important role for local authority housing, the fact is that its soaring cost is such that the Government must do far more to bring in the private sector, both in terms of home ownership and private rented accommodation. Will he please tell the Under-Secretary of State not to take such an arrogant and blind attitude towards the possibility of new lease arrangements?

Mr. Crosland

My hon. Friend is noted not for blindness but for clear sightedness, and not for arrogance but for modesty.

On the substantive point of that supplementary question, the Government have taken many measures to encourage the private house building industry, and the hon. Gentleman will be as pleased as I am to note that the recent statistics show a marked upturn in private house building.

18. Mr. Frank Allaun

asked the Secretary of State for the Environment if he will make a statement on his proposals for the future of the council house building and improvement programme, council rents and subsidies.

Mr. Crosland

I have nothing at present to add to the reply which I gave to my hon. Friend the Member for Woolwich, East (Mr. Cartwright) on 5th May.—[Vol. 891, c. 308–9.]

Mr. Allaun

Will my right hon. Friend accept a practical proposal? Is he aware that many local authorities, faced with extortionate charges by building firms, wish to use the highly successful direct labour departments of neighbouring councils but are not at present permitted to do so? How soon will he relax that restriction, which I believe he has stated he is prepared to consider but on which he is taking a very long time to act?

Mr. Crosland

My hon. Friend will be aware that we have relaxed the provisions which were causing particular difficulties in certain of the metropolitan counties—for example, in Sheffield and Manchester. He is right in saying that I have made it clear that I would like to see further relaxation of other restrictions on direct labour departments, and I hope to introduce a measure as soon as legislation time permits.

Mr. Raison

Does the Secretary of State agree that the contribution of the rates to housing revenue accounts has become completely excessive? What are his predictions for council rents next year, and how do they compare with what the rent levels would have been under the fair rents system of the Housing Finance Act?

Mr. Crosland

I cannot predict what the level of rents will be next year without a very much clearer idea of the rate of inflation next year, which I profoundly hope will be much lower than this year. As to what I understood to be the substantive point of his question, the hon. Member is right in saying that over the last few years rents have covered a substantially decreasing proportion of total housing costs, and we are likely to reach a situation in which the taxpayer and ratepayer combined will simply say "We cannot go on indefinitely footing the bill".

Mr. Heller

Will my right hon. Friend indicate what advice his Department has given to the Liverpool City Council and the other councils in the Merseyside Metropolitan District in relation to the housing programme? Is he aware that about 30 per cent. of unemployment on Merseyside—a very high proportion—is of construction workers? In an area like Merseyside it is important that there should be the fullest support for the local authorities in order to get the housebuilding programme going.

Mr. Crosland

I understand that my hon. Friend the Parliamentary Secretary has seen a deputation from Merseyside to discuss exactly the points which have just been put. He told the Merseyside local authorities in the strongest possible manner that he thought they should increase their housebuilding programme as rapidly as possible.

Mr. Mudd

I appreciate the generous reply which the Secretary of State has given to this question. Will he accept the following proposition? The whole point of council house programmes must be one of resources related to demand. Therefore, should right hon. Gentlemen not take a look at reducing standards in council house building in order to provide more homes for the homeless? Is it not wrong to cut back on local authority improvement programmes? Those houses which need improvement this year, at whatever the cost, will need it just as badly next year, but at a much higher cost. Will the right hon. Gentleman consider a reduction of standards for council house building and institute a total reappraisal and reassessment of the improvement system for local housing authorities?

Mr. Crosland

I have made an adjustment on council house improvements by switching £100 million from local authority lending substantially to council improvement schemes. I think the hon. Member missed the point when he referred to lower standards of house building. It is clear to me that we can build houses more cheaply and more quickly while maintaining standards at the level we wish to see. This comes back to the question we were discussing earlier, from one of my hon. Friends, which was discussed in the circular "Housing Needs and Actions". We must build houses more quickly and more economically, while maintaining standards.