HC Deb 08 December 1976 vol 922 cc429-30
2. Mr. Wyn Roberts

asked the Secretary of State for the Environment why he is proposing to introduce a new Bill to expand local authority direct labour departments.

The Minister for Housing and Construction (Mr. Reginald Freeson)

The Bill we shall introduce will remove obstacles to and introduce improved controls for operating efficient direct labour organisations and thus make the benefits of their activities more widely available.

Mr. Roberts

Do not these Government proposals mean an inevitable increase in local staff—an increase which has been condemned by many members of the Labour Party—and an increased burden on the ratepayer at a time of increasing severity, as mentioned just now by the Secretary of State?

Mr. Freeson

As the object of the Bill and the Government's policy is to increase the effectiveness of efficient direct labour organisations and to detract from the practices of inefficient DLOs, the opposite effects to those described by the hon. Gentleman will be produced.

Mr. Stan Crowther

Is the Secretary of State considering the introduction of further legislation to remove other restrictions on local authorities so that they may enter into more profitable activities? Does my right hon. Friend agree that there is something illogical in the view that only private enterprise may make a

profit, and would it not be a good thing for ratepayers to be allowed to go into profitable commercial activities in general?

Mr. Freeson

I accept the principle contained in my hon. Friend's latter remarks. If in the general body of his supplementary question he is referring to the abolition of the ultra vires principle, as I imagine he is, that is certainly not under consideration at present. We shall simply proceed with the Bill to deal with DLOs.

Mr. Heseltine

Does not the Minister understand that since the Layfield Report the practices of direct labour organisations have been widely condemned? Would it not be better to set out a code of practice under which DLOs had to prove that they were effective and efficient before being given any extension of powers?

Mr. Freeson

The reference to the Layfield Report is not particularly apposite. Several reports over the years have been critical of inefficient aspects of certain DLOs. It is equally true that many DLOs are very efficient, and that many private firms are efficient and others are inefficient. I ask the hon. Gentleman to await the Bill, because we shall undertake to do just what he has put to me.