HC Deb 03 November 1976 vol 918 cc1400-2
20. Mr. Douglas-Mann

asked the Secretary of State for the Environment whether he is satisfied that the present distribution of public expenditure on housing as between subsidies and investment or improvement is the most effective in order to relieve housing needs and sustain employment in the construction industry.

Mr. Shore

No, Sir.

Mr. Douglas-Mann

I welcome that brief reply, but will my right hon. Friend bear in mind that in the last seven or eight years we have been spending two and a half or three times as much on investment in new building and improvements as we have on subsidising mortgages and council rents? Even accepting the current restraints on public expenditure, does he not consider that we could achieve better results? Does he agree that we are effectively subsidising those who have satisfactory housing at the expense of those who desperately need it and those who work in the industry which could supply it?

Mr. Shore

We have to accept that we are operating on a very tight budget for housing expenditure, and we must therefore try to get the best results within that budget. I would not say that I think that the right distribution has been achieved between subsidies and investment, new building, modernisation and other work. However, there is an additional problem. It is not just a matter of the best possible housing policy. Housing and rent policy must play a part in the broader counter-inflation policy.

Mr. Rossi

In simple language, does that answer mean that council rents must inevitably rise if the right hon. Gentleman envisages transferring money from housing subsidies to further investment and improvements?

Mr. Shore

Council house rents have risen this year and will inevitably rise next year. The question to which we must address ourselves is whether, in the context of the counter-inflation policy, the rise is to be one which can be borne by council tenants or one which will be unacceptably high. We have to make a judgment on that matter.

Mr. Skinner

Why should council house rents rise and why should it be planned that housing subsidies be cut, relatively speaking, at a time when the Government found it possible to have £70 million transferred for the use of the Slater Walker debacle that took place in November 1975?

Mr. Shore

I assure my hon. Friend that, other things being equal, if I could lay my hands on that £70 million I should like to deploy it in my housing programme. We have to face the fact that the present situation partly reflects the much higher levels of interest rates that have persisted in recent years and the fact that rent income for housing revenue accounts accounts for historically a low part of the total.

Mr. Dykes

Is the right hon. Gentleman aware that the Minister for Housing and Construction has three times obstinately refused to receive a deputation from Harrow with an ingenious and imaginative idea for a home-purchase scheme that would provide additional topping-up on a mortgage or loan over and above the normal one, which would enable people to buy council houses on a total subsidy element far smaller than the existing subsidy on new buildings?

Mr. Shore

I am sure that my right hon. Friend will be most receptive to any proposals for topping up loans or anything else which is relevant and helpful to the housing situation. I advise the hon. Gentleman to write to my right hon. Friend on the matter.