CONTROL OF OFFICE DEVELOPMENT BILL

HC Deb 17 May 1977 vol 932 cc313-69

Order for Second Reading read.

7.14 p.m.

The Secretary of State for the Environment (Mr. Peter Shore)

I beg to move, That the Bill be now read a Second time.

On 25th February last, in reply to a Question from the hon. Member for Hornsey (Mr. Rossi), I informed the House that I intended to introduce legislation to continue the office development control powers beyond 4th August next, when they would otherwise expire, and I promised to make a statement later. I am therefore taking the opportunity provided by the debate on the motion for the Second Reading of this Bill to explain to the House the Government's reasons for wishing the office development control powers to continue and to describe how I shall operate the control in the future.

The main purpose of the Bill is contained in Clause 1, which provides for the continuation of the office development control power—which I exercise at present under Sections 73–86 of the Town and Country Planning Act 1971—for a further period of five years from 5th August 1977. In presenting this Bill the Government are fully aware that there are within the House—and on both sides of the House—hon. Members who would wish to see office development control abolished without further ado. But we also know that there are many other hon. Members most anxious that the control should be not only maintained but rigorously enforced.

As the House will recall, the history of office development control goes back to 1965 when its introduction was among the first actions of the Government led by my right hon. Friend the Member for Huyton (Sir H. Wilson). It was maintained throughout the period of Labour Government and when its powers expired in 1972 they were renewed by the then Conservative Government. Office development control has enjoyed the support of Government of both major parties.

Nevertheless, the objectives stressed have changed considerably over the period, reflecting not only the different priorities of the major parties, but changing circumstances. In 1965 the general aim was to promote the better distribution of employment in Great Britain and in particular to ease the severe congestion that then existed in central London. In 1972, when the Conservative Government decided to renew the control for a further five years, the objective of steering office employment to the less favoured regions was discarded. The right hon. Member for Crosby (Mr. Page), who was then Minister for Local Government and Development, told the House: We have concluded that an intelligent use can be made of the control for a limited period to further the objectives of the Strategic Plan for the South-East".—[Official Report, 26th January 1972; Vol. 829, c. 1485.] The emphasis then, as he made clear, was to concentrate growth within the South-East Region in a number of defined growth areas.

The effect was of course to reduce pressure in London and to divert employment to already prospering and growing centres all around the periphery. With the return of the Labour Government to power in 1974 the emphasis on steering firms to the assisted areas was again asserted. Throughout the whole period from 1965 there has been a gradual relaxation of the original 3,000 sq. ft. exemption limit—and in its geographical area of application—to the present exemption limit of 15,000 sq. ft. in the South-East economic planning region.

Now that the time has come for further renewal of these powers I have had to consider changed circumstances and the contemporary policy objectives that office control should serve. In coming to my conclusions four main considerations have influenced me. First, congestion is no longer a major problem in central London. In 1964 the figure for passenger traffic commuting into the central area during the rush hour was over 1,200,000. By 1976, 12 years later, this figure had declined to just over 1 million. Also, while in 1966 there were about 1.3 million people working in the central area of London there were nearly 10 per cent. fewer in 1975.

Secondly, while congestion in central London is no longer a major issue, the better distribution of employment in Great Britain remains an objective of continuing high importance. I am sure that all hon. Members who represent constituencies in the assisted areas will agree with me when I say that there are still not enough places of office employment outside the South-East of England. Although some cities have a good deal of empty office space at present, we can only improve on the position and balance of employment of many parts of the country by steering office development into them. That means diverting some firms who too readily suppose that the South-East is the only place to have an office.

Since June 1973 the Department of Industry has been paying attractive grants to firms which wish to move their offices and other service industry activities to the assisted areas. Up to the end of last February a total of 244 offers worth £8.4 million had been made under this scheme, which were expected to lead to the creation of 7,600 jobs in these areas. Only last October these incentives were increased, and since then the rate of applications has doubled. This scheme should encourage firms which cannot secure ODPs to move to the assisted areas and give local authorities in those areas a powerful means of attracting them. We rely upon the local authorities to encourage such firms to become established in locations where they can provide the best employment opportunities.

The third consideration is that the Government are determined to do all that they can to help the country's declining inner city areas—including those of London. In this we have widespread support. The relocation of offices can help here, although, naturally, the extent of help will vary from city to city. The fact that the office sector continues to expand makes it an obvious contributor to the regeneration of urban areas which have experienced an overall decline in employment opportunities.

The sort of benefits we can expect from the relocation of offices to those needy areas are: in the short term, new jobs for people living in the area—as well as office jobs these will include a proportion of jobs for unskilled manual and service workers; and in the longer term, a widening of the economic and social make-up of these areas by providing a greater range of employment opportunities. As secondary effects we can expect increased employment in services ancillary to office activities and environmental gains through the physical improvement of derelict or run-down areas. The fourth consideration is that I want to avoid unnecessary bureaucracy and to confine control to the larger and more mobile office developments.

It is with these considerations in mind that I propose to make the following policy changes. I have decided to confine the operation of this control to those office developments which are of major importance—to exempt developments in which no more than 200 to 300 people are employed. The smaller developments tend in any event to be more firmly rooted in their local economy. Accordingly, I shall shortly lay before Parliament an order increasing the exemption limit for ODPs from 15,000 to 30,000 square feet. This will lift control from some 55 per cent. of the number of applications we are currently receiving.

Not only will this confine the control to the size of development which is of most importance and most likely to be mobile but it will help the construction industry by allowing a number of small to medium projects to go ahead. I am sure this will be welcomed by the construction industry of whose problems we are—and, indeed, should be—acutely aware.

It will also help the property market. When the economy picks up again, it will be reasonable to expect an upturn in demand for new and better offices. The situation will require continuous monitoring if we are to get the policy right. In view of the time involved between seeking an office development permit and completion of the building, we must try to avoid the danger of the supply of new offices lagging behind demand, with the consequent inflationary effect upon rents.

In addition, therefore, I intend to give permits for a limited number of speculative office buildings in inner London. In selecting schemes for approval I shall be looking for those which make a strong contribution to the regeneration of the inner urban areas which require improved job opportunities and physical renewal. I have today granted an ODP for the development of 180,000 square feet of office space which forms part of the redevelopment of the approach to Clapham Junction Station in Wandsworth. This project will bring about a substantial improvement to an important inner city area and will provide—apart from the offices—new shops, a car park, a sports centre and a public square.

Mr. Arthur Jones (Daventry)

Will the right hon. Gentleman be extending this special consideration to the London dockland area? Is he coming to that point?

Mr. Shore

At present I should not like to nominate particular areas of London. However, from what I have been saying it will be clear that the speculative office developments at which we shall be looking with particular sympathy will be those that would help the renegeration of inner areas of London where redevelopment is required, and certainly that would not exclude dockland.

Mr. Douglas Jay (Battersea, North)

I should like to thank my right hon. Friend very cordially for this extremely sensible decision about the Clapham Junction site, although I know that he realises that it is not the only derelict site needing redevelopment in the Battersea area, where Government help will be necessary for development to go ahead.

Mr. Shore

I note what my right hon. Friend says. He is, of course, very conscious of the needs of the borough of Wandsworth. But I believe that this particular office project is thoroughly justified and will have a very good positive effect on this important part of that borough.

Apart from measured relaxations to assist inner London, the control will continue as at present—namely, ODPs will be available only to provide offices for firms that can demonstrate that they have a tie with the area.

In applying the control in the outer South-East Region we must make sure that the needs of other areas—the assisted areas and the inner cities, as I have already explained—are taken properly into account and that the development of employment opportunities does not outrun the general development of the economy. The House will recall that in my recent statement on new towns I indicated reduced population targets for third generation new towns and will be aware that the thrust to provide for over- spill in expanded towns is now somewhat abated. The provision of office space and particularly of the major developments which would come above the new 30,000 square feet threshold must be regulated accordingly in the outer parts of the South-East Region.

I turn now to the question of the place of the Location of Office Bureau in this new policy. When I made a statement just before Easter about inner city policy, I said that I had in mind a change in the direction of the bureau's activities.

As the House knows, its advisory service has provided London's management with information on all aspects of office location and office moves; and it has also provided valuable guidance to local authorities up and down the country which wish to encourage or need office employment. But up to now the emphasis of the bureau's work has been on decentralisation from London—to quote its terms of reference the decentralisation and diversion of office employment from congested areas in central London to suitable centres elsewhere. This remit clearly needs revision. In particular I propose to give the bureau two new tasks: attracting international concerns so that they locate office employment in Great Britain, including London; and giving particular attention to the promotion of office employment in inner urban areas, including London. This involves broadening the bureau's terms of reference to "promoting the better distribution of office employment" throughout the country. I shall shortly lay before the House a draft Order in Council to give effect to this change.

The bureau will, of course, continue to have the general duty of assisting in the mobility and efficiency of office employment. In carrying out its wider remit it will simply be extending and giving a new emphasis to the activities and methods, which, under its founder chairman, Mr. Sturgess, and its present chairman, Mr. Prendergast, it has developed and perfected with such marked effect. In particular, I hope that it will be able to attract international concerns to establish themselves in Great Britain—whether that be in London or in other major cities.

Although it is the bureau's publicity which attracts most attention—that, too, will have to reflect the new approach—the mainspring of the bureau's success has been the collection and collation of the information that office employers need in order to consider and plan a move, for I have no doubt that the results that the LOB has achieved depend on the reputation it has earned for giving employers easy access to accurate, comprehensive, impartial and up-to-date information, and to the research studies it has done on the mobility of office employment.

The bureau's experience and research are equally valuable to local authorities interested in attracting office employment and interested to learn how they can make themselves attractive to it. The bureau will, of course, continue to give special attention to the needs of towns in the assisted areas for office employment, and to helping the inner urban areas up and down the country to attract the office employment which they need.

So much for Clause 1 and the new policies we intend to pursue if, as I hope. Parliament enacts the measure.

The remaining clauses of the Bill need not detain us long. They provide for some minor, technical amendments to the existing legislation.

Clause 2 simply makes it possible to provide that the floor space exemption limit for office development permits be expressed in terms of square feet or in terms of square metres.

Clause 3 remedies a defect in the existing statutory provisions. It provides that an order made by the Secretary of State to exclude any area from the control shall be subject to the proper parliamentary procedure. I trust that the House will welcome this proposal for greater parliamentary control over my actions and those of my successors.

Clause 4 also remedies a defect in the existing statutory provisions. It relates only to local authority development. At present, I am told that there are exceptional circumstances in which local authorities in the controlled area can develop offices without getting a permit. The purpose of the clause is to close that loophole and put them on the same footing as other developers.

Having thus explained its purpose, I commend this short Bill to the House in what I hope has been a properly short speech. I hope very much that it will be given a Second Reading.

7.32 p.m.

Mr. Hugh Rossi (Hornsey)

First, I thank the Secretary of State for the way in which he has presented the Bill and the important statement that he made in opening the debate. We welcome all that the right hon. Gentleman has said about his new policy, especially that he has recognised the difficulties of the construction industry, and the anxiety he has shown in his new policy in trying to help the industry. I noted that he has regard to the fact that he must guard against the future upward spiralling of rents in the centre of London by ensuring that there is a sufficient supply to meet demand as and when the economy boom, for which we all wait, takes place.

We welcome the right hon. Gentle man's proposals to try to revitalise the inner-city areas, whether they be in London or in other cities. We noted with great interest all that he said about the new function of the Location of Offices Bureal, which I understand will now bring back jobs into the inner cities whereas its activities were directed to ensure that they were taken out of the inner cities.

That is a great reversal of policy and one begins to wonder whether there is anything left in ODPs. There seems to be little justification or basis, with all the exemptions there are, for keeping this administrative machine, other than perhaps the difficulty of knowing what to do with the civil servants who are presently engaged upon the exercise until some other job is found for them.

Having recognised the great step forward that the Secretary of State has taken, it is appropriate to consider whether there is any justification for maintaining any ODP system. With that in mind, I have turned to see what independent commentators have said about the operation of the system. It seems that there is almost universal criticism. The right hon. Gentleman should have regard to what is being said by planners about ODPs, the effect that they have had on our economy and inner cities and whether they have been effective in giving the sort of help to the assisted areas that the Secretary of State hopes will continue.

I refer the right hon. Gentleman, first, to the book written by John Radcliffe entitled "Town and Country Planning", which was published in 1974. In the chapter on offices he wrote: Location theory for industry might be unsophisticated but for offices it is primitive. The policy underlying it is indiscriminate, inconsistent, tardy and heavily reliant upon trial and error. Too much emphasis is placed upon the existing stock and future supply without sufficient regard to the nature of demand. Virtually no attempt has been made to define which office functions are most appropriate to central metropolitan positions, which to peripheral positions and which to the provinces, and how a policy of decentralisation, if considered expedient, might best be implemented. That is a heavy and formidable criticism of the ODP system. It is said that it is crude and unscientific. Mr. Radcliffe demonstrates that one of its consequences was to contribute to the spiralling increase in office rents that took place in the 10 years that he had under review in his book, with prime rents in the City of London rising from about £2 per square foot to £15. That cannot be attributed wholly to the consequences of inflation.

Compared with other commercial centres it has been demonstrated that London office rents in 1974 at £15 per square foot—they have stayed at about that level, having stagnated with our economy—were unfavourable compared with other commercial centres. For example, in Brussels, at the time Mr. Radcliffe was writing, rents were about £3 per square foot. In Zurich they were about £4 a square foot. Our economic difficulties have seen a stagnation in the rise in office rents while those on the Continent have begun to catch up.

However, London is still uncompetitive, rents ranging between £50 and £160 per square metre. I have to convert to metric terms as those are the figures that the CBI has available. That level of rents has to be compared with £36 to £47 per square metre in Brussels, £37 to £56 in Western Germany, £46 in Amsterdam and £16 to £44 in Milan. This difference in the rental of office accommodation in the centre of London exists at a time when we are so dependent upon our invisible earnings in banking, shipping and insurance to hold our balance of payments above water.

The theme of spiralling rents is taken up by Peter Townroe in his book entitled "Planning Industrial Location", which was published in 1975. In chapter 9, under the heading "The Movement of Offices", he writes: The ODP system has certainly contributed to the very high office rental values in Central London, thus making operations for companies forced to remain in London more expensive as their leases get renewed. The system also contributed to large increases in the wealth of individuals and companies involved in owning and leasing properties. Thus we have it that ODPs, by artificially restricting the amount of office space available, have greatly contributed to the cost of life in London, reduced our competitiveness in the international commercial world and served to make more wealthy those who invest in office property blocks— they toil not, neither do they spin: And yet I say unto you, That even Solomon in all his glory was not arrayed like one of these. I hardly think that that is a result that the Labour Party can regard with equanimity, especially when it tends to lecture us so much concerning the evils of unearned income, non-productive activity and the need to keep down the cost of living. However, I imagine that it consoles itself with the thought, as the right hon. Gentleman has done, that this is the unhappy consequence of the need to have a fairer distribution of new employment throughout Great Britain and the important principle of ensuring a shift of employment from the relatively wealthy South-East to the more depressed and assisted areas.

If that is the case—the Secretary of State said that it was his major objective—I am afraid that I must disillusion him. I refer the right hon. Gentleman to an article written in January of this year by G. B. Goddard in "Town and Country Planning". There he comments upon the Government's "Office Location Review" which was published in April 1976. He says: the proposed new powers will improve only marginally on the pretty abysmal success rate of the present system that is noted in the Review. Thus of all the forty one ODPs refused to named user applicants for 10,000 sq. ft. of space in the GLC area in the period 1965–72, eleven had remained in the same premises and twenty four had subsequently obtained an ODP on the same site or on another site in London. Only six of the applicants had in the event moved out of London, and all of these stayed in the S.E. I think that the explanation for that is to be found in the comment made in Chartered Surveyor for February 1973. It reads: The demand for additional floor space increased, but not because of an increasing number of jobs. The average amount of floor space per worker in offices was rising, not only because acceptable standards were rising, but also because mechanisation of many routine office jobs meant that more room was required for the machines. However, at the time, lack of information meant that this pressure from within central London for the expansion of existing offices was equated with additional employment and the interwar concept of London attracting development at the expense of other areas. In other words, the concept of the Government in restricting office accommodation in London is destroyed if one finds, first, as the review has shown, that those refused ODPs do not move out of London and the South-East anyway, and, secondly, that their motivation is to increase their capacity within their organisaton in order to have more efficient machines and internal operation.

I think that this is borne out by the experience of the LOB, which says that over two-thirds of its recorded moves have been to distances of less than 40 miles and that only one-eighth of them have been over distances of 80 miles—a very small proportion. The majority of the relocation of offices has been to Reading, Southend, Maidenhead, Croydon, Hounslow and Richmond. Others have been to new towns or expanded town developments, such as Ashford, Basingstoke, Swindon and Harlow. Again, in spite of the LOB, the concentration remains once more within the South-East.

Thus, the ODPs have not been a signal success in terms of creating jobs in the assisted areas. The only real success attained in this area has been that of the Government in decentralising their offices. Even so, there is currently a dispute with the unions over the 31,000 civil servants whom the Government wish to move out but who do not wish to leave London.

All this must be balanced against the stultifying effect that ODPs have had on the firms wishing to expand. I remind the House of the 11 that Mr. Goddard mentioned who had decided to stay where they were in their cramped and overcrowded conditions and the 24 who, after much delay, frustration and expense, obtained ODPs for their original sites or sites nearby.

Furthermore, the assisted areas have not been assisted. The Government review admits that indigenous growth has been the principal contributor to office development, especially in the assisted towns. The growth there has taken place not because of the movement of jobs, but because of the growth in their own populations.

To cap it all, some of the decisions of the Department responsible for ODPs have been bizarre and inflexible to say the least. This has manifested itself in respect of applications for office development over central area railway stations.

Here no extra land is required. Little or no burden is placed upon local public transport. Yet 43 such schemes proposed by British Rail were frustrated by ODP refusals. One is entitled to ask what difference this might have made to the finances of British Rail had it been allowed to enjoy rental income from developments such as these.

The Under-Secretary of State for the Environment (Mr. Guy Barnett)

The hon. Member has quoted the figure of 43 refusals. What period does that figure cover?

Mr. Rossi

It covers the 10-year period. I am quoting from the authorities that I mentioned earlier.

The closer one examines the operation of the ODPs, the more one wonders why we have allowed the system to remain for so long. The ODPs have created more problems than they have solved. Even the relaxations we have heard of today will not go sufficiently far to help deal with some of the problems I have indicated have been created by past practices. The Opposition take the view, therefore, that the time has come to scrap the ODP system altogether, or at least to let it die a natural and unlamented death by not extending its life in the way that the Bill seeks.

Certainly London and the inner cities, facing the crises they do, they must be given the freedom to allow their commercial life to expand. At the moment there is a surplus of office accommodation in the London area. Given the costs of construction against the rents obtainable, few developers at the moment are prepared to risk capital in building new offices.

That in itself is an argument for the abolition of unnecessary restrictions and controls. But the time will come, we all hope, when our economic life will be revitalised by the nourishing flow of oil and when it will once again expand. We must then allow our commercial offices to meet the challenge and not to be constricted and limited by inefficient and insufficient accommodation. If we do not do that, I am afraid that once again we shall see an office rents spiral or explosion blunting the edge of our competitiveness.

I suggest that we leave it entirely to the local planners to determine the problems of congestion and transport that might arise out of the granting of planning permission for the building or expansion of offices. There is no case for continuing a system that has served us so badly in the past and created so many difficulties. Therefore, I regret to say to the Secretary of State that we cannot support him on the Bill.

7.48 p.m.

Mr. Geoffrey Finsberg (Hampstead)

I, too, begin by welcoming the relaxations mentioned by the Secretary of State. I shall have two detailed questions to which I hope the Minister will be able to reply.

It is significant that the Government Front Bench is occupied by three London Members. They will find it difficult to explain to their constituents why, when unemployment in greater London has more than doubled in the past four years, they are seeking to prolong the life of a system which is still helping to keep jobs out of London. I look forward to hearing their explanations on this point.

The ODP principle in London is out of date, and I shall cite one or two authorities that I think will have the backing of all London Members. The 1965 and 1971 Acts were temporary, the latter being basically a consolidating measure. They were temporary but, alas, so was income tax when it was first introduced, and it is still with us. I do not wish to see the ODP system still with us in five years' time.

What cannot be stressed too much is that London is not asking for any preference. All London is asking for is that it should not be continually disadvan- taged, which it has been over the years. I accept what the Secretary of State says and very much welcome his response and his new terms of reference for the LOB. I join him in paying tribute to the current chairman—I did not know his predecessor—who has done a first-class job, even if it was a wrong-headed job because of the instructions given him by the Government. I am sure that now he has a different mandate he will do an even better job.

What I was not quite clear about was whether in the revised terms of reference that were being given to the LOB it was clear that under no circumstances would its job be to assist anyone to move out of London. That was not completely clear in what the Secretary of State said and perhaps it can be cleared up later.

With regard to office development permits, there is no political party divide. I would just remind the House of the resolution passed by the GLC on 12th October when all three parties, even the Liberals, who were then there, were unanimous in asking for the abolition of ODPs. I do not think I do him any injustice when I say that the one Labour Member on the Back Benches, the hon. Member for Ealing, North (Mr. Molloy) was not unsympathetic to that idea. I look forward to seeing what he does tonight should there be a Division on this issue. Of course, the Government may decide to drop the Bill.

But in the April 1976 review the GLC said: the following are giving cause for concern— (1) A fall-off in employment for clerical workers. (More than 80 per cent. of female and more than a third of male office employment is in the clerical workers category.) While the numbers of administrative and professional workers continued to grow in London between 1966 and 1971, there was nevertheless a drop of over 10 per cent. in employment for male clerical workers, mainly in inner London. There was a similar drop in employment for female clerical workers in inner London though in their case the decline was counter balanced by a corresponding increase in outer London". It went on to talk of Further dispersals of civil servants under the Hardman report; Recent moves by major banks and insurance companies to move out staff; and The effects of further progress towards automation, new methods and improved telecommunications. The GLC continued by asking that the system of office development permits should be dropped, and added: in any event should not be renewed after August 1977 when the present powers expire. If it is to continue, notwithstanding the Council's representation to the contrary, then consideration should at least be given to limiting it to large developments only (say those over 100,000 sq. ft.)". I shall be interested to hear why the Government have not found it at least possible to respond by going up to that figure of 100,000 square feet for exemption because, after all, that was the considered view of those people who know the problems of London best. The GLC knows these problems much better than does the little man sitting in his office in Marsham Street who is dealing with the ODP system throughout the country.

I reinforce what my hon. Friend the Member for Hornsey (Mr. Rossi) said about the need to transfer the examination on the question of ODPs from central Government to local government. I repeat that that was the unanimous view of the GLC on 12th October, and the same view has been re-expressed in a letter only this week from the new council. The policy is still unchanged. It is also right to quote from another document, the 1976 review "Strategy for the South-East".

In its review, The Economist described the major changes which it highlighted as follows: London is no longer the engine behind the expansion of the South East. It is a disaster area losing 100,000 people a year (mainly skilled workers), where more businesses fail than manage to get out in time, and pockets of unemployment as severe as in the depressed areas. I do not think there is a single London Member of either political party who would disagree with that analysis. Yet the Secretary of State continues to believe that there is a need for office development permits in Greater London. I do not believe there is a need for them anywhere. But if there is to be some sort of control, let it be exercised, in London, at any rate, by the GLC and equivalent bodies outside London which know their own local areas and their own local problems. In a debate in which we are discussing London and elsewhere it would be—

Mr. William Molloy (Ealing, North)

I understand the theory which the hon. Gentleman is submitting in that local authority planning officers in London know the problems best. It would appear to be a simple fact that they are bound to know better than the officers in Marsham Street. But that does not always follow in practice. In my own area in the London borough of Ealing I have seen large parts of my constituency almost maimed for life by the behaviour of planning officers. The only hope we might have is that the appeals of ordinary people against the decisions of local planning officers may be brought to the attention of my right hon. Friend via his inspectors. I do not think we can say that in general all will be well if we simply leave things to planning officers in the borough.

Mr. Finsberg That was not quite what I was saying. I was saying, let us leave it to the GLC or the Greater Manchester Council. It is, after all, for the elected members on those authorities to take the decision.

That brings me to another quote that I was going to make from Hansard of 14th January. Unlike the Minister who wound up in the previous debate, I shall not quote myself. I shall quote instead the former Government Chief Whip, who was a highly knowledgeable person, the right hon. Member for Bermondsey (Mr. Mellish). He said: When I was appointed a junior Minister with responsibility for London housing by my right hon. Friend the Member for Huyton (Sir H. Wilson) in 1964, we received the advice, which had also been given to the previous Conservative Government, that at all costs London had to be denuded of population and industry. We were told that it was growing fat and bloated and that the othe regions were suffering as a consequence.

That was the point the hon. Member for Ealing, North (Mr. Molloy) made. Foolishly enough, I believed it. I took the advice of those great planners. For many months I spent much time urging industry and people to leave London. Looking back now, I realise that it was about the worst advice that any Government were ever given."—[Official Report, 14th January 1977; Vol. 923. c. 1828.]

That reinforces the point that it is the advice given to Ministers, or the advice given to elected councillors, on which they base their decisions. If that is not so, there is no point in having an elected member. That is the point that I put to the Secretary of State for him to consider. Of course, it may be that he always takes the advice or his officials, but I have a greater respect for him and I do not think that he does.

What I have said so far demolishes much of the case—the rest was demolished by my hon. Friend the Member for Hornsey—for ODPs. I should like to know a little more about the effect of raising the limit from 15,000 square feet or metres to 30,000. The Secretary of State said this would save about 51 per cent. of applications. May we be told in actual figures what that means? Are we talking of 100 applications, 1,000 applications, or 10,000 applications? May we have it related to the 51 per cent.?

The Financial Memorandum says: The effect of the Bill will be to continue the cost of staff for administering the provisions, estimated at £128,000 a year, including overheads, at 1976 prices". May we assume that when the exemption limit is raised to 30,000 sq. ft., there will be a saving of 50 per cent. of the present staff doing this work?

I said that unemployment in Greater London had more than doubled in the past four years. I believe, as I said, that those who can judge the situation best on the advice of their experts are the elected representatives. These experts are not merely planners. Some local authorities are now employing industrial officers to liaise with industry and to tell them what the employment prospects are. If local authorities can get the advice and act on it, rather than the Secretary of State, a better job will be done. I hope that even now the Government will have enough common sense not to proceed with the Bill.

8.1 p.m.

Mr. Arthur Jones (Daventry)

My hon. Friends the Members for Hornsey (Mr. Rossi) and Hampstead (Mr. Finsberg) have covered the ground so fully that there is little left to say to justify the Bill. I want to deal with the central bureaucracy which has been built up around office development permits, the Location of Offices Bureau, and other methods by which the Government have tried to move office and service industries from one part of the country to another.

This debate shows the tremendous change of opinion there has been since the early 1960s. In the Press and the professions there was almost universal acceptance in 1964 of these arrangements to move office employment out of London. The system was extended to the whole of the South-East, the Midlands and East Anglia two years later. Those controls were essentially removed three years later, and one wonders whether that was not an admission that things had gone too far. Since 1970 office development permit arrangements have ruled only in the South-East.

As recently as July 1974 the Secretary of State said that strict application of controls that would apply severe restrictions would be brought to bear on speculative development, even for the replacement of existing accommodation. With concrete examples, my hon. Friend the Member for Hornsey has shown what a limited effect this has had elsewhere than in London. Even some of the movement from London has not been very far afield.

There is no doubt that this system has taken up a great deal of the time of the surveying and planning professions and of the planning departments of local authorities throughout the South-East. One should therefore consider the bureaucratic consequences of what has happened hitherto and of what the Bill proposes.

The office location review, which was published in July last year—a carefully researched document in which most Departments, including the Cabinet Office, were involved—considered not only ODP control but possible alternative instruments of policy in trying to prevent what the Government saw as too much office development in the South-East. One cannot but question whether such an exercise was worth the cost, which must have been tens of thousands of pounds, of such an erudite document. I wonder what a cost-benefit analysis would reveal.

We are concerned not only with these arrangements under the Department of the Environment. The Department of Industry has its own methods of getting service industries and office development to certain locations. I know that this is not the Secretary of State's remit, but in July 1973, under the Industry Act of the previous year, incentive schemes were used to get service industries to move to assisted areas so as to encourage office job take-up in those areas. There was a grant of £800 per employee moved with his work, normally up to 50 per cent. of the number of new jobs created. That, too, was a considerable bureaucratic machine using public money to encourage people to move.

The Location of Offices Bureau, established in April 1963, has only a modest staff and budget. Expenditure of 1975–76 was about £172,000. But we must consider its effect on public and private expenditure. In its 13 years, the bureau has moved 1,976 firms—presumably mainly out of London—and provided 139,326 jobs. It has done the work that it was asked to do. Many of us have been fascinated by the octopus advertisements on the Underground—one of the most effective advertising campaigns that I have seen.

The policy has been successful, but does the bureau need a new rôle? Can that new rôle be justified when, as my hon. Friend the Member for Hornsey said, many local authorities have substantial organisations operating successfully to encourage people to develop in their areas? The development corporations are outstanding examples of what can be done. One must question the need to continue the bureau.

It is not only the firms that have moved that have been affected. Many others have been persuaded to develop for the first time elsewhere than in London, which has achieved the Government's purposes. But this has led to a progressive run-down in London. That is the remarkable change of opinion that has occurred in the past few years.

I am told that the office development permit system last year refused 57 programmes, totalling 302,000 sq. ft. It would be interesting to know where that office development was provided. Does it mean that the contracts were lost, or does it mean that they moved out of London within a comparatively short distance?

In today's circumstances different considerations must apply from those that justified the introduction of the scheme in 1964. There is no question but that the arrangements distort the normal operation of financial and economic factors. From what the Secretary of State has said, I do not think that the Government have justified the need for continuing the office development arrangements for another five years.

The Secretary of State is not anxious to wind up the arrangements, so he is struggling to alter them by increasing the development from 15,000 to 30,000 square feet and the number of employees from 200 to 300. In this way he hopes to catch only the schemes of major importance. I do not consider that this is adequate justification for retaining the scheme of office development permits.

In the context of the wish of the Government to reduce public expenditure and bring greater effectiveness into the economy here was a small but positive example of the need to act. The Government should recognise that ending the scheme would mean savings in cash terms, in manpower, and in the interference in the economy.

I wish I thought that the controls, albeit significantly reduced, were not being maintained for their own sake, but I do not. I think that there is a reluctance on the part of the Government to surrender any form of control. They are lifting the controls somewhat but they are reluctant to lose a measure of control altogether. They are determined to maintain this control despite overwhelming evidence that it no longer serves a useful purpose.

The Government must face the realities of today. I regret that in bringing this Bill before the House they appear to be unwilling to do so.

8.13 p.m.

Mr. Tony Durant (Reading, North)

I represent an area some 30 miles from London. We have been affected by the whole ODP policy for a long time.

I have been involved with two local authorities—at Woking and at Reading. Historically, both towns mushroomed as a result of the railway age. I moved there with my parents because in those days the fares were cheap and it paid to move out of London. These towns grew very fast. The result of that growth was a decline in availability of office accommodation and other accommodation had to be redeveloped.

Both Woking and Reading decided to redevelop and both drew up imaginative schemes. The problem of the whole concept of redevelopment—whether it is done in partnership or direct with the local authority—is that it needs to be of the type where office accommodation is on top with shops and other facilities underneath in town centres. Office development permits, therefore, became a crucial part of the development of these towns.

If a plan were drawn up that involved large sections of the town with restricted ODP development, the net result was that there were large gaps in the development in one part of the town and that another part was blighted and became a desert where nothing happened for years. That has happened in East Reading.

One of my constituents had a German guest and when this man was leaving the town he apologised that the Germans had bombed Reading so vigorously. My constituent pointed out that it had nothing to do with German bombs—the local authority had pulled half of the area down. It was not its fault, office development permit policy had brought this situation about. Therefore, I am against the continuation of this policy in the Bill.

Another problem in the outer periphery towns is the cost of travel. It now costs a phenomenal sum—about £450 a year—to get to work. This means that people are seeking office employment within Reading rather than travel to London. They prefer Reading and they want to live there, but office development policy tends to work against that. This is bad for Reading.

One of the difficulties that we do not recognise enough is that because the policies of successive Governments have attracted industry from the South-East to the North—and I am not against that in principle—different kinds of employment must be found in Reading, Woking and other parts of the South-East. My constituency was once known for beer, bulbs and biscuits. We still have the beer, but the bulbs have gone to the West Country and the biscuits have gone to the constituency of the right hon. Member for Huyton (Sir H. Wilson). Manufacturing biscuits was once a crucial part of Reading's history. A number of companies are moving out simply because of the attractiveness of placing industrial units away from London. This means that other employment must be found, but the whole ODP policy works against it.

Reading is becoming the regional headquarters for the whole of that part of the country. We have a number of regional offices being established in Reading and we have attracted one or two headquarters from London because of the easy communications and the facilities. We need this development and we welcome it tremendously, but the ODP policy tends to work against it, and that is why I want to do way with this Bill.

I welcome the relaxation of the controls. The increase to 30,000 square feet and to 200 to 300 employees sounds fine, but in any major development in a town one starts with a key block in the centre. This is still controlled by the policy of central Government and this fact may hold up development around it. Unless there is a key block of offices with shops underneath in the centre, the whole development of a major block in a town can be held up.

I welcome the relaxation, however, because it will help in areas like mine. Nevertheless I do not believe that there is any need for it at all. We can make our own decisions with the Berkshire County Council.

I have been involved in marches on Ministers. In fact I marched, as a member of the planning committee in Woking, on the right hon. Member for Crosby (Mr. Page) and sat in front of him trying to persuade him to let us have more ODP permits for Woking. He was not too keen on the idea, because we were developing rather fast. We would have liked freedom of action to do what we wanted. We wanted to get rid of the blight that is serious in many developing towns.

Although we welcome the fact that Reading has had ODPs granted, this trend must be continued. We need the opportunity to make our own decisions and our own plans for developing our own town. The only reason the Government are anxious to hang on to this bureaucratic machinery is that they hate to get rid of any planning policy.

I am slightly anti-planner. I have a great suspicion of planners, who usually meet in offices and examine charts but seldom look at what they are dealing with on the ground. Too often the planners do not understand the needs of the people. A development may look tidy, but it needs local control and responsibility and not central bureaucratic machinery. This is an out-of-date concept, we do not need it any more, and I hope that we shall vote against the Bill tonight.

8.20 p.m.

Mr. William Molloy (Ealing, North)

I welcome the relaxation offered in the Bill. However, it has been suggested that it does not go far enough and that there should be more relaxation, and possibly no control whatever. We must try to keep a sense of balance.

We all know that there was complete unanimity in the House 10 or 12 years ago on this subject. There had been massive office development in Greater London, and the dangers were obvious. Large office blocks of 10 or 12 storeys were built in our capital. Yet we were always being asked by constituents, particularly by young couples who wished to marry, "Why cannot Parliament see to it that new homes are built for people such as ourselves and many like us, instead of allowing the development of great tower office blocks?" Therefore, we were all agreed that we needed to control office development.

The hon. Member for Hornsey (Mr. Rossi) quoted a number of learned works written by learned gentlemen. However, we know that those learned gentlemen in 1976 were of the view that we should do away with the control of offices. But some of us have memories that go back a long time. The same learned gentlemen in 1965 told Parliament to control the mushroom development of offices in the capital. They will say anything if they can make a bit of money by selling their books. We should all be mugs if we fell for that kind of nonsense. Therefore, let us try to keep the matter in perspective.

There was a need to control that type of development, and it was right that we took action—but we took it too late. Nevertheless, that legislation was introduced by a Labour Government, and was rightly continued by a Conservative Government. All the brilliant geniuses in our universities, so busy reading books written by other people, tell us when they see something going wrong "You must change the situation". We do not want them to tell us these things. We know all about them. They could make a much greater contribution to the problem by indulging in a little silence for four or five decades, because that would help us all.

I wish to pay tribute to the hon. Member for Hampstead (Mr. Finsberg) whose knowledge of the problems of London we all appreciate. We do not always see eye to eye, but London Members recognise the hon. Gentleman's abilities. We may have disputes about solutions, but we generally know what we are talking about because we see these things happening on the ground.

The hon. Member for Reading, North (Mr. Durant) spoke of the rôle of local authority planning departments. The Opposition generally believe that this Bill is not required and suggest that we should leave it all to the planners. That was all said at about 7.50 this evening—but at 8.15 p.m. the hon. Member for Reading, North took the reverse point of view and said that he was an anti-planner. He gave good reasons for not wishing to leave everything to the planners. But we cannot have the Tory Front-Bench spokesman saying "Leave it all to the local planners" and then, a short while afterwards, being told by a Conservative "The last thing we should do is to leave it to the planners".

The wise thing for the House to do is not to listen to what is being said in this House by the Opposition, but to take full cognisance of the experience on the Labour Benches, particularly my contribution from which the House is now benefiting. I hope that that contribution will not now be spoilt by the intervention of the hon. Member for Reading, North.

Mr. Durant

The point I was trying to make was that planning gets worse the higher up one gets. I am in favour of local planners, but I sought to make the point that the higher up the structure one went, the more remote the planners appeared to be.

Mr. Molloy

That may be true, and certainly the power vested by Parliament in local authorities is pretty formidable. We have all seen local planners at work on their charts, with finely drawn lines that look so impressive, but many of the plans have been drawn up merely to look pretty. If one asks "Where is that area?", the planners do not know what it is because they have drawn up their plans from somebody else's plan. Planners at local level are always desperately concerned with steel, concrete and glass, and when one seeks to question those plans it is almost regarded as a form of lèse-majesté. Many planners appear to be quite unconcerned about the needs of ordinary folk who live in the streets where the planners would like to see warehouses and large office blocks.

The three major parties in the GLC have requested the abolition of office control. I would not go as far as that. We have heard that industry is being attracted out of Greater London. Looking at the matter from a GLC standpoint, I believe that we have suffered as much as have other regions. I cannot see the sense of a policy which suggests "Because there is high unemployment in Wales or in the North or in Scotland, you in London must have your share". That is the sort of stupidity one finds handed down from youngsters from Oxford and Cambridge. It is no good saying to the ordinary man on the dole, "There is only 9 per cent. unemployment in your region". That kind of figure cuts no ice with the man with a family who is out of work. As far as he is concerned, he regards himself as 100 per cent. out of work.

Mr. Robert Kilroy-Silk (Ormskirk)

I am sure that my hon. Friend as a Socialist is in favour of sharing our resources throughout the country in terms of need.

Mr. Molloy

Of course I go along with that, but I do not see that kind of classification being sorted out in terms of unemployment. I shall have to work that one out. I can see the idea behind that suggestion—namely, that in certain areas one's fellow countrymen are suffering excessive unemployment, and that if industry can be attracted to those areas of large-scale unemployment, the problem in those areas will be reduced. In order to do that, it is argued, areas such as the South-East and Greater London must be told that they have enough industry and that no more can be brought into those areas because it must be spread into other areas.

However, things do not work in that way and that idea is not working. That was the intention and it was a good and honourable one, but it has not worked. Industry has been lost to London—and not only did the industry leave that we expected would leave but industry that we had believed would come to London did not come. What have we been left with? There are large shells of buildings in all parts of London that are going to rack and ruin. Men are losing their jobs.

I can give a classic example of a large factory that employed skilled men in the glass container industry. Since 1920 it had been a household name in that industry. I am referring to Rockware Glass. The firm made all sorts of clever glass containers as well as milk and beer bottles, and it sold its products to well-known firms all over the world. It then became financially attractive for the firm to say to its skilled employees, "You have done well boys, but we cannot respect your skills or crafts because the power of profit tells us that we must leave you in the lurch and shove off somewhere else." That is exactly what happened. I am anxious because the site that was used by that company is still empty.

London Members on both sides of the House want industry to be attracted back to London. I am gravely apprehensive that large industrial sites, such as the one that I have just mentioned, will be occupied by 12 to 13 warehouses. At one time about 1,500 skilled workers would have been employed on such a site, but if the area is used for warehousing there will be jobs for only about 30 to 40 clerks and a couple of fork-lift-truck drivers. That is the danger. Warehouses and offices cannot help such an area as Ealing.

As the hon. Member for Reading, North and the hon. Member for Hampstead have said, the ramifications are enormous. I support them, and I go further. The ramifications are extremely serious.

At one time in Ealing youngsters about to leave school were put in touch, through special courses, with the glass container industry. Some trained as specialists in that industry and many have travelled all over the world to sell the skilled work produced by their colleagues in England. Some school leavers became skilled fitters, carpenters, joiners or glass-blowers. All this was encouraged by the education authority in the area. When pupils were attracted to this industry their education was directed to that end. The idea was that they could become skilled artisans in this great industry. But suddenly the great industry was no longer there. Not only were the fathers of these pupils out of work but the whole educational system had to be readjusted, and there was nothing else to readjust to because no other industry came to Ealing.

Hon. Members are today pleading for more industry, but it is essential that we do not act too peremptorily because there is a danger that instead of industry we shall get warehouses and office blocks. I ask the Minister to bring to the attention of the Secretary of State the warnings that I have given about the danger of valuable land that once housed industry being taken over by either office blocks or warehouses, with the consequent threat to job creation in Greater London.

I wish to make one last point that has already been mentioned by hon. Members opposite, and it is another point that I ask the Minister to pass on to the Secretary of State. I entirely agree with the hon. Members for Hampstead and Reading, North that, as far as possible, all planning should be left to the local authority or the councils that know the area. Everybody is saying "Hear, hear" to that, but I wonder whether they will say "Hear, hear" to this: when councillors make their decisions for the benefit of the people that they represent and when pompous planning officers do not agree with those decisions and there is an appeal to the Secretary of State for a public examination, the councils know that they cannot count on the support of their own officers, whose salaries are paid by the ratepayers. Those officers will not appear at the tribunal on behalf of the ratepayers who pay their salaries because they claim that it is infra dig. That is as absurd as our wanting to send armed forces somewhere in the world and the Chiefs of Staff saying that although Parliament may have taken the decision, they did not agree with it and would therefore not carry it out.

This has been the attitude of some planners, and the problem must be seriously considered. It is no use hon. Members opposite and I agreeing in principle that local authorities should have more say in the planning of their citizens' towns if, in the final instance, too much power is vested in the local bureaucrats. That is as heinous as having too much power vested in bureaucrats at any other level, and I hope that my hon. Friend will mention this problem to the Secretary of State.

I have some apprehensions about the Bill and am not entirely happy with it. However, there is enough in it to tempt me to support it. At least we are not swimming in completely the wrong direction. There was a need for control of office building and, despite what others say to the contrary, I believe that that need still exists. For the reasons that I have mentioned, some form of control must be held at ministerial level.

8.36 p.m.

Mr. Fred Silvester (Manchester, Withington)

I shall not follow the arguments of the hon. Member for Ealing, North (Mr. Molloy) in his hot pursuit of pompous planning officers. Everyone who has spoken so far has come from the South-East or thereabouts, with a heavy preponderance from London. That will change when my hon. Friend the Member for Crosby (Mr. Page) speaks, but it is not surprising that there should have been so many speeches from hon. Members from the South-East since the Bill will have a direct effect upon London and the South-East.

But it should be remembered that the Bill was planned to have a powerful indirect effect on other regions and it is right to question whether we should allow this extension for another five years. It is not a clear judgment, but rather a narrowly based one.

I have never believed that there is any point in trying to build the rejuvenation of the North-West or any other area on the ashes of London, and I agreed with the reaction of the hon. Member for Ealing, North to the intervention of the hon. Member for Ormskirk (Mr. Kilroy-Silk). There is not much joy in equal shares of misery, and I do not see the joint of sharing out unemployment in that way.

The object of the exercise is to balance the various attractions of the regions so that the natural decisions of industry and office builders will be spread more evenly over the country. There is a natural gravitational pull to the South-East, and it is at this time, when there is unemployment in the South-East, that we may test whether we are serious about this policy.

It is easy to say that there should be special measures in assisted areas at times when it is a nuisance to have more business in the South-East because of the difficulty of finding labour, but the argument is more difficult when the South-East itself comes under unemployment pressure. The argument about relative levels of unemployment must be seen in the context that the whole country is sinking while the South-East is just beginning to get its feet wet. In the North-West and in other areas they are already well aswim. That is the situation with which we are faced, and the Bill is concerned not only with the present situation but with what will happen in the next five years. It is right, therefore, to look at it in a rather longer-term way than the hon. Member did.

There is a point which worries me considerably, and it is a major factor in my attitude towards the Bill. We are faced with the gradual peeling away of the traditional means of dealing with assisted areas. We lost the regional employment premium. I agreed with that because I did not think that it was very effective. Although the Government are still holding firm, the whole procedure for the transfer of civil servants is now under strong attack from the Civil Service unions, from Committees of the House and from speeches here. The whole attitude towards it is changing. I should not be surprised if the pressure continued to build up and there were an announcement that a change is to be made.

There is now the question of dropping the office permit arrangement. I think that we are in some difficulty here. It is obviously true that we do not wish to continue with something which has proved relatively ineffective. On the other hand, if we start peeling away these arrangements one by one, we shall have difficulties, because we do not thereby do away with the problem at the same time.

I entirely agree with the comment made earlier that all the evidence is conclusive that the strength of a region will come from its internal generation rather than anything we are likely to import from outside. That is true of offices, and the figures quoted confirm that. Nevertheless, it is true to say that imported jobs have made a contribution. If we examine the statistics of the Location of Offices Bureau for 1963 to 1976, we can say either that the North-West, the North, Wales and Scotland have only got 6 per cent. of the offices which have moved out of London, or, doing some quick mathematics, we can say that about 7,000 jobs have been moved out of London. If we simply quote the percentage it sounds derisory, but to areas in receipt of 7,000 jobs it is not derisory. That is the situation with which we are faced.

It so happens that in the North-West, part of which I represent, we are relatively well placed with offices. We have a rather higher proportion than the population would lead us to expect. But for other regions that is not the case, and the importance of the office element in the rejuvenation of these areas should not be underestimated.

My real concern in dealing with the Bill is not so much the office development permit system, to which I will come shortly, which I think has been ineffective. I am more concerned because it is part of the continuing erosion of the support for these areas. I think we shall soon come up against the problem at the next stage of IDC policy. I realise that it would probably be out of order for me to go into that aspect, but the IDC is the permit system relating to the industrial side, and there is quite substantial evidence from some of the academics and from others that the IDC policy has been one of the most effective ways of getting new jobs into the assisted areas. We should take that into account.

We have then to ask ourselves, given that we all agree with all these objectives, whether the office development permit policy is the right way of going about it? Clearly the answer to that must be "No". I do not think there can be any serious doubt that the statistics which were quoted, and which I think are generally accepted, show a remarkably small return for all this effort. If we were seriously setting out to get more office jobs in inner city areas or in any other part of the country, we should be disappointed by the return for what has been many years of this policy. As we have heard from London Members, we are now seeing a similarly adverse effect in London. If we pose the question—What is the trade-off between the advantage to the assisted areas and the disadvantage to inner London?—we must come to the conclusion that there is greater disincentive to inner London than any benefit to the other areas. It is for that reason only that I support my hon. Friends tonight. It is a narrow judgment.

It is most important that, having made that assessment, we undertake the next step. It is up to those of us who oppose the Bill and to others who have misgivings about it to point out that, nevertheless, we need some mechanism. The problem will not go away. The need for offices in other parts of the country is important.

One test will be the extent to which the Government hold firm to the proposals for Civil Service dispersal. I am aware that the Minister of State, Civil Service Department has emphasised that is his intention, but it is an interesting microcosm of the whole problem. It is true that people who are now employed in London in Civil Service jobs do not wish to go to Bury or somewhere else. They have their roots, like everyone else. Of course, a certain amount of inefficiency results from transfer. However, unless the Government, who in this respect have more powerful means of decision than any private firm, are prepared to take that step, we shall not get the pockets from which other satellite developments can occur.

I support rejection of the Bill, because that is right, but something must keep going in its place. A whole review of the way that we treat the regions is necessary. Many historic proposals could be demonstrated to have failed or not to have been very successful. Therefore, we must search for something new.

The most powerful argument against the Bill was adduced by my hon. Friend the Member for Hornsey (Mr. Rossi). He said that 41 firms had been checked, that of those only six moved out of London, and those six moved into the South-East. Therefore, keen though I am to find a way of channelling new resources into the assisted areas, I cannot support a Bill which will prove ineffective in achieving that end.

8.50 p.m.

Mr. T. W. Urwin (Houghton-le-Spring)

It is a pleasure to follow the hon. Member for Manchester, Withington (Mr. Silvester) if only because he has attempted, with a measure of success, to lift the debate from London into the regions. As I represent a constituency in the Northern Region, I welcome his initiative. I listened with great interest to his recital of the development area incentives and his whole attitude to the Bill and the general subject of office development control.

I am sure that the hon. Gentleman will forgive me when I tell him that I dissociate myself completely from that part of his speech in which he referred to his agreement with the recent decision to abrogate the regional employment premium. The whole of the Northern Region—as the House knows and as you certainly know, Mr. Deputy Speaker—is, like most of Scotland, a development area. I hope that we have gained some benefit from the operation of office development control, although the hon. Member for Withington and the hon. Member for Hornsey (Mr. Rossi) sought to dissuade me from that belief.

I welcome the Bill, but with reservations because of the relaxation of control, to which my hon. Friend the Member for Ealing, North (Mr. Molloy) gave an unqualified welcome, and because of the whole history of office development control. I was a Member when the system was introduced, and I recall the serious and extensive arguments in this Chamber on the subject.

One cannot think about office development control without immediately thinking of that highly controversial project, Centre Point, around which many of our arguments revolved, and the fact that when the first Act was introduced it was undeniably proved that far too much office space was available in the metropolis in comparison with the regions. At that time we were deeply concerned about the absorption of sometimes scarce building materials and the fact that skilled labour was being diverted from more praiseworthy jobs, such as the construction of housing, to build the tower blocks to which my hon. Friend the Member for Ealing, North referred. In some cases it was impossible to find tenants for the blocks when they were constructed.

There is and always has been tar too great a concentration of these resources in London. When the hon. Member for Withington speaks about the North-West, I am reminded that in the North-East and the Northern Region generally we have not only a higher unemployment rate than any other region in the country, including Scotland, but far too few outlets for school-leavers. There is far too little office employment for them, no matter how good their academic qualifications. On leaving school all too few of them find that sort of employment, whether in Government offices, commerce, or other sections of private industry.

My hon. Friend the Member for Ealing, North, in a rather philosophic discourse, referred to the justice of sharing resources. Surely it is right to try to increase the woefully inadequate job opportunities available to young people in my constituency, for example, which is dominated by coal mining, where only a few handfuls of office jobs are available anyway.

The town in which I live is bordered on the north and south by the two new towns of Washington and Peterlee, where land and other facilities are available for office development. Both these new towns have much to offer to Government offices and other offices. Certainly, Washington new town has. Both of them have tremendous leeway to make up. They are admirably geographically placed in an industrial area where the catchment area for young people is large enough to justify the allocation and construction of offices, whether Government or private.

I see office development control as an integral and essential part of the regional policies which have been pursued by both Labour and Conservative Governments. It is a historic fact that the right hon. Member for Crosby (Mr. Page) had the onerous responsibility—sometimes not meeting with the full approbation of his Back Bench colleagues—of administering the office development control policy handed on by the previous Labour Government. There is everything to be said in favour of the Bill and of the extension of powers sought in it.

My final argument in favour of creating more office work in development areas has a high economic content. Office space in the centre of London is much more costly than in the Northern Region, whether it be in Newcastle, Sunderland, Durham, Washington, Peterlee, Newton Aycliffe, or elsewhere.

Despite the opposition of some civil servants to a move, it is a fact that the Northern Region has become one of the most attractive in the country. It has sweeping open spaces replacing the old colliery spoil heaps; there is the beautiful and rugged Durham and Northumberland coast; there are the North Yorkshire moors. The Lake District and the Scottish Borders are both within one and a half hour's driving distance. There are all the amenities for enjoyment by people decanted from London or other parts of the country. We can also claim to have made available by the beauties of the North more accessible by the development of a system of communications much better than ever before.

I hope that the extension of the powers contained in the Bill will provide us with more opportunities for employment, particularly for younger people, than we have ever had in the North.

8.59 p.m.

Mr. Ivan Lawrence (Burton)

The hon. Member for Houghton-le-Spring (Mr. Urwin) said that he was pleased that the debate had been lifted away from London to the North. Perhaps I can attempt to lift it away from stale political dogma into the fresh air of reality.

As the hon. Member for Ealing, North (Mr. Molloy) says, both sides of the House are divided on the dispute about whether we should have planning restrictions and controls. That is a direct reflection of the fundamental rift between us. Members on the Government Benches believe in planning and controls. They will hold on to planinng and controls long after the need for them has passed.

The Bill provides for a layer of bureaucracy and planning which is unnecessary. I concede—as will all hon. Members—that the original legislation was justified, although by the time it was introduced in 1965 there had been a shift. The need for a restriction in commercial development had passed. That was because of the measures taken by the Conservative Government to discourage the further proliferation of commercial development.

The House often legislates just as a situation is beginning to turn against the need for legislation. That was reflected in the original legislation, which the Labour Administration intended to be temporary. Perhaps it was to our shame that we continued the temporary nature of that legislation instead of abolishing it.

The position that existed in 1965 cannot be compared with the situation today. In 1965 there was congestion of office development in London and other parts of the South-East. In 1965 there were not the same financial problems that face the Government at present. In 1965 a new Labour Government were in power after 13 years of Conservative rule. The new Government needed to flex their planning muscles and to show themselves to be a Socialist Government of the future.

The position now is different. First, the policy of rigid control in London and South-Eastern towns has begun to create more problems than it solves. Hon. Members who have become familiar with environmental matters cannot but have been impressed with the vast amount of evidence which pours into Government Departments of the rundown, the poverty and the misery of unemployment in the inner city areas. The present situation is different from that which existed in 1965 when the legislation was introduced.

Mr. Donald Anderson (Swansea, East)

Surely the central point is that the rundown is in the manufacturing base and that the office mix in London compared with that in the provinces is still favourable to London.

Mr. Lawrence

There is some strength in that argument. Nevertheless, there has been a rundown in employment in the inner city areas, in particular in London, even in commercial properties. About 100,000 people have moved out of London. The demand earlier this decade was to move commercial development out of London to other parts of the country. The result has been a rundown in the metropolis and the South-East area. That has caused tremendous harm and we are now experiencing massive unemployment. The situation is graver than it was in the mid 1960s. Anything that we can do to get employment back to the inner city, urban areas will cure many problems—not only the problems of unemployment and poverty but those of crime.

The second change that has come about is that in 1965 local government wanted these controls. But now we know that the new local government body in London, the Greater London Council, under Conservative control, is against them. We come back to the point that must be made time and again in debates of this kind—that we should leave development of local areas to those who understand it and know it best, and they are the local government in the particular place. If the GLC, under Conservative control or Labour control, feels that it would be better off without these controls, it ought to be allowed to make the choice, because it is the democratically elected body for the area. As far as possible, planning of this kind should be left to local authorities.

Mr. Kilroy-Silk

The hon. Gentleman does not seem to know anything about regional policy. The GLC is not a local authority but a regional authority. The hon. Gentleman is contradicting himself all the way through what he is saying.

Mr. Lawrence

I do not think that the hon. Gentleman appreciates what it is that I am saying. Anyone who argues that the GLC is not a local authority ought to study local government a little more.

Mr. Urwin

It is a region, all the same.

Mr. Lawrence

The position is as I have stated it. It is that the GLC does not want these controls, and the GLC, being the local authority—whether or not it is a regional local authority—ought to be able to take these planning decisions.

The third change is that we have, I think, learnt a little in the 12 years or so since the passing of this legislation, and we realise that if we can make savings in bureaucracy and in public expenditure, that will be to the good of the nation. The Government have been making very strenuous efforts to cut back on public expenditure and to cut out waste, particularly bureaucratic waste. Here is an opportunity to do this and to remove a useless layer upon the bureaucratic system. It is an opportunity of which I should have thought that the Government, in the present financial straits, would have been only too delighted to take advantage.

It may be thought that the views I am expressing are the views purely of a Conservative. I am very proud of the fact that I am a Conservative. I think that we have too many of these controls, restrictions and limitations and that it is a valid criticism of Socialism that Socialists hold on to the controls and the planning long after that is necessary. However, I draw the attention of the House to what the right hon. Member for Bermondsey (Mr. Mellish) has had to say in recent months about this legislation. After all, he was a Minister in charge of London development at the time that the legislation was introduced. He has said, When I was appointed a junior Minister with responsibility for London housing by my right hon. Friend the Member for Huyton (Sir H. Wilson) in 1964, we received the advice, which had also been given to the previous Conservative Government, that at all costs London had to be denuded of population and industry. We were told that it was growing fat and bloated and that the other regions were suffering as a consequence. Foolishly enough, I believed it. I took the advice of those great planners. For many months I spent much time urging industry and people to leave London. Looking back now, I realise that it was about the worst advice that any Government were ever given."—[Official Report, 14th January 1977; Vol. 923, c. 1828.] That comes out of the mouth of a London Member who had responsibility for planning and housing at the time that this legislation was introduced. Let hon. Members not think that this is just a piece of party polemics. It stretches across the party barriers. I am only sorry to see that the right hon. Member for Bermondsey is not in the Chamber at present to give support, as it were, for the Opposition's attitude to this legislation, however many concessions the Minister may already have made.

In short, therefore, I say that this sort of legislation proliferates a wholly unnecessary layer of bureaucracy and planning controls. Office development should best be left to those who know best about it—namely, the regional planning authority or other forms of local planning authority. When the present legislation expires on 4th August it should be allowed to stay expired. It has served its purpose and it should go. I am pleased that the Opposition have taken a hard line against it.

9.11 p.m.

Mr. Robert Kilroy-Silk (Ormskirk)

I was extremely surprised to find the hon. Member for Burton (Mr. Lawrence) appearing to represent metropolitan London. Either the hon. Gentleman has his eye on a London seat, or he has some peculiar motivation to advance the claims of London, claims that have been advanced so frequently in the past against those of the other areas of the country.

Like my hon. Friend the Member for Houghton-le-Spring (Mr. Urwin) in the North-East and my hon. Friend the Member for Swansea, East (Mr. Anderson) in Wales, I am surprised that the hon. Gentleman should make out a whole case in terms of London, he representing an area such as Burton. But then it is not surprising that he seems to have this confusion in his mind. The hon. Gentleman obviously has no concept of what a region is when he talks of the GLC in terms of a local authority.

Mr. Lawrence rose—

Mr. Kilroy-Silk

No, I am not giving way to the hon. Gentleman. I do not have enough time to give way.

Mr. Lawrence rose—

Mr. Kilroy-Silk

I have not finished with the hon. Gentleman. Perhaps he will choose to intervene at a later stage.

The hon. Gentleman made his normal, expected protestations about bureaucracy and free enterprise. That is what we have learned to expect from him. What he said is what we have heard so often from the Opposition Benches. Conservatives want a Tory free-for-all. They want no attempt to determine a proper, logical, coherent plan of development that will suit the country as a whole and the regions in it—regions such as Merseyside and the North-East, which have suffered years of neglect and decline. If Tory freedom, Tory free-for-all and the loosening of controls and bureaucracy that the hon. Gentleman wants are allowed to take place, they will lead to the proliferation of office buildings in London that are built at a profit, built to stay empty, while we have dereliction, high housing costs, a lack of adequate housing, and many other deficiencies.

I am sure that the rest of the country will say with me that it wants nothing of Tory freedom. However, the hon. Gentleman learns quickly. That much has to be said for him. At least he has learned that the Labour Party believes in planning. He turns to a startled House and says "The Labour Party wants the Bill because it believes in planning". Next week the hon. Gentleman will be saying "Labour Members believe in Socialist planning". That is true.

Mr. Geoffrey Finsberg

The planning of 1½ million unemployed.

Mr. Kilroy-Silk

It is because of our belief in planning that many of us do not fully accept the Bill, which extends for a further period the power to control office development. The Bill does not go far enough. We do not want a continuation of the existing powers. If there are any defects in the Bill, they are not those that have been outlined by Conservative Members. There are controls over the building of offices but they do not go far enough.

Bearing in mind the speculative office building that takes place in London, the South-East and the South-West, the facilities in the North-West and the North-East and the unemployment in the construction industry in those areas, the only logical conclusion is that there is not enough control over office building in areas where there is transport congestion, congestion of houses and schools, and a great burden upon all the social services.

Those are the conditions that we have witnessed in London. At the same time there is an intolerable level of unemployment and a lack of opportunity in the North-West and the North-East, and especially upon Merseyside. There is unemployment in the construction industry and a lack of proper facilities.

Given that situation it is eminently sensible to have control and planning. It is not necessary to be a Socialist to believe in that. Surely it is sensible to consider these matters dispassionately and objectively, whether it be England and Wales or the United Kingdom, and to attempt fairly and equitably to distribute and allocate our resources where they are needed and when they are needed. That seems to be eminently sensible. One does not have to be a Socialist to believe in that approach.

That approach does not imply a sharing out of misery but a sharing of the resources available to us to alleviate misery. Of course, other Conservative Members, like the hon. Member for Burton, have spoken in favour of London even though they represent constituencies in the regions. I suppose that they have to follow what has been said from their Front Bench and adopt the same rationale if they are to be able to explain their vote to their constituents.

The important thing is that we should be allocating resources to the areas where they are needed. They are needed in the North-West and the North-East. They are not needed in the South-East or the South-West to the same extent. It is ridiculous to suggest that this is in any sense unnecessary and potentially damaging bureaucratic control.

Such control is even more important when there is a depression. It is more important to share our resources then than to share them when there is a boom. One Conservative Member said that we should share resources in a boom but not in a depression. He said that London should not share its resources in those circumstances with the North-East or the North-West. Surely that is precisely the time to allocate resources fairly and equitably.

Perhaps when there is a boom the deprivation and neglect of decades in the North-West will go by unnoticed, even though it ought not. There is a greater need than ever, however, to share out the resources now.

We hear the Conservatives talking about freedom from controls and calling for public expenditure cuts in other areas. They want freedom from bureaucracy and yet they complain about unemployment in the North-West and Merseyside. They complain also about direct works departments. I know of no direct works department that has built a block of offices that has remained empty. No such department has built a Centre Point that has remained empty for years. If there is to be control of office development, it should not just be the controls in the Bill that ensure that offices move out to areas where they are needed, but a control to ensure that far more of our capital resources are put into the building of homes.

The Conservatives have been speaking about free enterprise and are in favour of the property developer and the speculative builder. They want capital to move freely after the profits in speculative building even if the buildings are to remain empty for several years. They worship Mammon but ignore the needs of my constituents who have no homes and who desperately require extra housing, which is denied them because the necessary resources are tied up far too much in speculative building for profit.

I want my right hon. Friend the Secretary of State to start some speculative building of his own. Let him put in hand a variation of the advance factory, building advance offices instead. Merseyside desperately needs more offices and I understand from the Merseyside Development Office that it receives several inquiries a week from concerns wanting to move into the area but unable to do so because suitable accommodation is not available. They require a purpose-built office with a lease or credit guarantee. On Merseyside we provide factories and we manage to attract industry, but there is a demand for office facilities and it is not being met.

Cannot my right hon. Friend help Liverpool and Merseyside? It is a service industry area and it has all the ancillary skills and resources to meet the needs of those industries. Cannot my right hon. Friend initiate a scheme whereby the builder can build an office block because the Government are guaranteeing his credit and capital or are prepared to take the office over as an advance office and to promote its letting when it is built?

I regret that this Bill is necessary. I would have hoped that my right hon. Friend would go a little further so that we control the building of offices in future and ensure that investment is directed to the building of houses more than we have done in the past or seem prepared to do in future. Regions like Merseyside which are not affluent, and which never have been, will never be unless the Government take more positive steps than they have in the past to ensure that resources are distributed through a Socialist regional policy which will generate the movement of resources from one area of the country to another according to the criterion of need.

There should be no other criterion, neither that of profit nor of who can shout the loudest. It should not be my hon. Friend the Member for Houghton-le-Spring versus the hon. Member for Ormskirk or dog eats dog, but a Socialist policy of sharing resources. We shall achieve that only when we have public control of the construction industry and the public ownership of land. I hope that my right hon. Friend will pursue a far more positive policy in future and along with his other right hon. Friends ensure that we do not get any diminution of this policy but rather its toughening up in future.

Mr. Speaker

The winding-up speeches by the Front Benches begin at 9.25 p.m. It is hoped that the hon. Member for Swansea, East (Mr. Anderson) will co-operate.

9.22 p.m.

Mr. Donald Anderson (Swansea, East)

I certainly agree that there is a case for rethinking the location of offices policy. But I do not think that now, a time of high unemployment, is the time.

This continuation Bill is opposed by the property world, by the new GLC and by the Conservatives, who are clearly trying to mend their fences as speedily as they can with the property world, having had such difficulties with the development land tax and the Community Land Act.

Mr. Geoffrey Finsberg

The Bill is opposed by the GLC totally. Both parties oppose it.

Mr. Anderson

So be it. But clearly the new GLC has been particularly vocal in that respect.

Mr. Geoffrey Finsberg

No.

Mr. Anderson

Conservatives at last week's conference of the Incorporated Society of Valuers and Auctioneers said that office development control had distorted the economic base of the country. That is the whole argument for regional policy as such. If, as has been argued by the hon. Member for Hornsey (Mr. Rossi), office development policy has been ineffective, the same argument can be used against regional policy. Both regional policy in general, as well as office development policy, have had some significant effects in the regions.

The London argument, as instanced by my right hon. Friend the Member for Bermondsey (Mr. Mellish), is that there are parts of London with high unemployment. What is wrong with London is the mix of employment. The manufacturing base has moved out to the regions and London is still largely over-dependent on the service sector.

But the regions, particularly my own part of Wales—the North-East, which is the area with the highest degree of unemployment currently—are over-dependent on the manufacturing base and need to attract offices. They need to attract service employment at a time when the public sector, as a result of constraint, is unable to provide it.

If we were now to start dismantling this control, although it has not been as effective as we should have liked, it would be another blow to the Government's regional policy, which by and large has been effective and will be seen as such. I, together with hon. Members representing not only Wales but the regions, ask for the continuation of this control.

9.24 p.m.

Mr. Graham Page (Crosby)

The hon. Member for Swansea, East (Mr. Anderson) will, I hope, forgive me if I do not follow the line of his speech directly, because it is appropriate that I should follow closely on the heels of my neighbour, the hon. Member for Ormskirk (Mr. Kilroy-Silk). I say "closely on his heels" because he has left the Chamber. Had he remained, he would have found that I do not argue for what he called the Tory free-for-all. In fact, I would join him in pleading for greater consideration for the difficulties of the North-West, particularly Merseyside, where both of our constituencies are situate.

However, I shall argue that there is a far better way of helping Merseyside and the other development areas and the less favoured areas than the ODP system, which hon. Member after hon. Member tonight, without always going as far as to say that it has completely outlived its purpose, has said should be thought out again because circumstances have changed. The Secretary of State himself described a number of ways in which he hopes to develop the system. I was hoping that he would drop it altogether.

It appears from the Explanatory and Financial Memorandum that office development is controlled very economically by the Department of the Environment. A sum of only £128,000 per annum is required to process about 430 applications, which I calculate to be about £300 per application. I gather that it will in future be much cheaper. My hon. Friend the Member for Hampstead (Mr. Finsberg) pointed out that the Secretary of State said that the load would be reduced, if he extended the limit, by about 51 per cent. I therefore presume that the cost, and I trust the manpower, will be halved.

If there has to be some control in addition to planning control, one might ask why this comparatively cheap system should not be continued. My answer is twofold. First, this cost is merely the tip of the iceberg. The system might be cheap to run within the Department of the Environment, but it is very expensive for commerce in preparing these applications and in the delay in obtaining planning permission because of the necessity to obtain an ODP first. Second, this control, as an addition to planning, is now ineffective in its objective. It is not only no longer necessary but is an encumbrance to planning control and development.

I should declare an interest as a director but not a shareholder of a property trust which has from time to time built offices. I am conceited enough, having declared that interest, to say that I know something about the problems which have been and will be faced by that kind of developer.

The original objective of the ODP system in 1964 was the control of office development in metropolitan London and, a few months later, in the South-East as well, so as to reduce or at least to keep static office employment in that area. No one now wishes to reduce office employment in London—at least not just for the sake of reducing it, as was the original intention. My hon. Friend the Member for Hampstead made that point effectively, as did the hon. Member for Ealing, North (Mr. Molloy), although the latter did not entirely carry with him his hon. Friend the Member for Ormskirk.

If the result were to encourage the increase in office employment in the North-West and the North-East, I imagine that London would grin and bear it, but the system has not been doing that very effectively. Incidentally, that was not the original objective of the system. That developed over the late sixties and early seventies. The ODP system has been singularly ineffective in achieving the objective of forcing development into the North or other areas—the South-West and Wales—where office employment was needed. I do not say that the system has been a complete failure; of course not. It has achieved the movement of perhaps 7,000 jobs.

The policy of dispersal of Government offices has achieved far more than the ODP system in taking office jobs to the assisted areas. The lack of success of the negative system of ODPs in bringing about a positive increase in office jobs in assisted areas was admitted by the Government when they introduced financial incentives.

My hon. Friend the Member for Reading, North (Mr. Durant) pointed out that he lost beer, bulbs and biscuits because of the success of industrial incentives, and the hon. Member for Ealing, North lost glass containers. That movement of industry was so successful that it was obvious that the same sort of idea should be applied to office movement.

The Industry Act 1972 gave an £800 grant per employee moved out and a five-year rent subsidy. On top of that there was selective employment tax and the regional employment premium, but none of these incentives succeeded in achieving the sort of movement of jobs that we had all hoped would be achieved at the time.

The need for incentives was obvious. This can be seen when one looks at the figures that were referred to by my hon. Friend the Member for Hornsey (Mr. Rossi) when he quoted from the office location review for the seven years up to 1972. This showed that of the 41 larger "named users" whose ODP applications were refused in the London area only six moved out of the capital and all of those moved to locations somewhere in the South-East. That was the sort of failure that we had to face.

My hon. Friend the Member for Daventry (Mr. Jones) asked about those firms that were refused applications last year. He asked whether they had moved out of London or just moved into the suburbs. Certainly there has been an increase in the number of office jobs in the assisted areas—some 8 to 12 per cent. But that is in line with the rest of the country. In the office location review this point is brought out very formidably in Section 5 which says: private sector relocation from other areas appears to have made only a very small contribution. The assisted areas have been benefiting mainly from the growth of 'indigenous' office employment, i.e. the expansion of enterprises already located in assisted areas or the establishment there of new establishments with origins in these areas. So the increases come mainly from indigenous growth.

It is not surprising that by 1974 the then Secretary of State for the Environment set up this review of office location. When the review reported, the Secretary of State said that he would increase the limits of 10,000 sq. ft. to 15,000 sq. ft. for exemption from office development permits and that he would consider the rest of the suggestions in the review.

The whole tone of the report of the review was that the ODP system on its own had outlived its purpose and was not achieving the objectives that we all hoped would be achieved. I quote again from the review: The control acts on the supply of new premises. By adding to the delays imposed on the market by the planning system, it is an additional brake. Whilst the control may not be very effective in achieving relocation to the assisted areas in that firms, refused an ODP, have a choice of alternatives, it nevertheless provides an opportunity for 'steering' because the individual application identifies the firms with the accommodation problem. So the best that the report could say was that it gave a chance to steer a firm. But it did not succeed, because the report concluded by saying: If a control is needed in addition to the incentive scheme…the choice would seem to lie between the occupation permit scheme —I hope that the Secretary of State will not adopt that— or continuing the simpler, more familiar ODP system. Having recognised that the system was not successful at that time, it gave the Secretary of State no real recommendation what to put in its place.

I should like to examine how the system operates in practice within the Department of the Environment. A small unit there receives and processes the applications and receives from the Secretary of State from time to time guidelines—in the same way as he might send out a circular to local authorities telling them what applications for planning permission he would call in. They are the guidelines upon which the unit works.

The provision in the legislation which directs the Secretary of State in the exercise of the discretion which he has in issuing office development permits is wide. Obviously, such guidelines have to be given to those administering the issue of the permits, but because of those guidelines the unfortunate applicant has to do an enormous amount of work before his permit is considered.

Before it moved its 1,500 employees to Sheffield, the Midland Bank considered as possibilities 750 cities and towns. That is what has to be done by those who apply for an ODP. They have to satisfy the Department of the Environment that nowhere else outside the controlled area will do. They have to carry out a survey of the staff—who will move or who will not move. In considering going to Merseyside or to the North-East, they have to consider whether there is staff available in that area, give their reasons and all the rest of it. It is an elaborate and costly business for a firm to prepare a planning application. Furthermore, it is hopeless to expect to get an application through unless the applicant firm is the "named user" or can satisfy the Department that the property will be custom-built.

Up to the present time it has been impossible to obtain ODPs on speculation, although the Secretary of State has now said that he intends to allow that in future. I refrain from commenting upon why a Socialist Government should support speculative builders; I agree with him to some extent, and I am glad to see a reform in his ideas.

There are now four categories of areas of control. There is the City of London—and nobody wants to control development there. It is said in the office location review report that the professions, in- dustry and banking are concentrated in London because they need to be close together.

Secondly, as for the rest of central London nobody wants to depopulate its office population there. Thirdly, in suburban London there has been much building development and it has been shown that a firm that has been refused permission to build in a suburban area rarely goes far elsewhere. Such a firm might go further into the South-East but not to the North-West or the North-East. Fourthly, there is the rest of the South-East—and by that I mean the South-East regional planning area not just the South-East of London but an area that goes as far as Bedford—I am sure that there matters can safely be left to the normal planning law.

That is why I am against the Bill and why I say that the ODP system should now be scrapped and control left to the normal calling-in procedure under Section 35 of the Town and Country Planning Act 1971. Under that Act, the Secretary of State has full power to give directions about the sort of planning application with which he wishes to deal himself. Indeed, such directions have been given many times about various types of development. I can recollect one that was issued about hypermarkets, and there have been others about forestry and so on.

If the Secretary wishes to have central control or some supervision over office development in the South-East where that development would exceed 30,000 square feet, he could disband the ODP system altogether and issue a directive that he wishes to call in all such planning applications. The advantages are that there would be no need for a separate unit in the Department of the Environment and that there would be no need for such applications for permits. The consideration of such development would be carried out through a partnership between the local authority and the Secretary of State at an early stage and the Secretary of State would have flexibility in applying the limits as necessary and in phasing out the whole system in due course.

My hon. Friend the Member for Manchester, Withington (Mr. Silvester) said that if ODPs were to go, something should be put in their place. My hon Friend wants to destroy the ODP system, as I do, but I do not want to destroy the whole of planning control. I wish to see provided a far better form of control—one within the normal planning law in partnership with the local authorities. The normal planning law would be applied and the Secretary of State could call in whatever he felt was of national or regional importance. That would mean that we should do away with the bureaucracy of the present ODP system and recognise that a planning system can deal with the problems that confront us far more effectively.

Now that the hon. Member for Ormskirk has returned to the Chamber I must repeat what I said at the beginning of my speech when he was absent, that is that dealing with such matters on a planning basis rather than by ODPs would be of far greater assistance to Merseyside and the less favoured areas of the country.

9.45 p.m.

The Under-Secretary of State for the Environment (Mr. Guy Barnett)

It will not be possible in the 15 minutes available to me to reply in detail to all the points made in this interesting debate, but I shall do my best at least to refer to most of them.

I start by answering the specific questions of the hon. Member for Hampstead (Mr. Finsberg), who asked how many ODP applications were received each year. In 1975 the number was 510 and last year there were 325 applications. I think that the hon. Gentleman wanted the figures because he believed that if we raised by half the figure of square feet for exemptions we could save 50 per cent. of the applications and therefore 50 per cent. of the staff who administer ODP controls in the Department.

I cannot do sums that simply, if only because of the differences in the number of applications in, for example, 1975 and 1976. However, I give the hon. Gentleman an absolute assurance that we shall, as always, adjust the number of staff to the work load with which they have to deal.

I was mildly surprised by the number of Opposition Members who raised the bureaucracy bogy. They admitted that only 14 staff in the Department coped with ODP control and that the Location of Offices Bureau spends less than £250,000 a year, yet we heard about bureaucratic control and the Government being reluctant to surrender this form of control. Hon. Members seem to be seeing if not Communists at least bureaucrats under the bed.

It may not be an effective policy of control—I shall come to that later—but it is certainly an inexpensive form of control for us. The right hon. Member for Crosby (Mr. Page) told us about the expense that property companies and others go to in preparing applications for ODPs. I shall look at the points that he raised, but we cannot be accused of continuing a highly expensive form of control.

There has been much criticism of ODPs in the 12 years of their operation. Every hon. Member opposite who took part in the debate, even the hon. Member for Manchester, Withington (Mr. Silvester), who has something to gain from it, was critical of the system as it has been operated. They suggested that it should be abolished.

I have to ask them whether they believe that there is a place for an office location policy. Obviously, the right hon. Member for Crosby thinks that there is but he believes that it should be part of general planning policy and that the Secretary of State should exercise control over the location of offices in this way. However, he was the only Opposition Member who made even that admission and we must assume from the speeches of the hon. Member for Hornsey (Mr. Rossi) and others that the Opposition want no form of control over the location of offices.

In a debate on 14th March the hon Member for Hampstead said: All impediments to growth must be removed—IDCs, ODPs".—[Official Report, 14th March 1977; Vol. 928, c. 110.] I am sure that is not yet official Opposition policy, but things are moving fast in that direction.

It is important that I should try to explain why we believe that some form of office location policy must be continued. It was nowhere better illustrated than in the speeches of my hon. Friends the Members for Ormskirk (Mr. Kilroy-Silk) and for Houghton-le-Spring (Mr. Urwin), who spoke about their con stituencies and the range of opportunities for people looking for employment there I did not fully follow the speech of my hon. Friend the Member for Ealing, North (Mr. Molloy), who seemed to be referring more to manufacturing industry than office employment.

Several hon. Members drew attention to the fact that we are concerned with the balance of employment in London compared with other parts of the country. Figures from the office location review indicate that, according to the figures in the 1971 census, the percentage of people in office accommodation in the Northern Region is 18.5. In Yorkshire and Humberside, the percentage is 19.3 and in Wales 18.0. I have no reason to believe that they are all that different today. In London the percentage is 38.3. Those figures illustrate quite simply that there is a very unfair balance of employment in different parts of the country, and it is that which we need to attempt to correct first.

It is partly for that purpose that we believe that there is a need for an office location policy, apart from the fact that office development in inner cities, as my right hon. Friend has pointed out, can be an important form of assistance in the regeneration of a run-down area, whether that area is in inner London, Liverpool, Birmingham, or anywhere else.

There has been criticism of the office development permit system. A lot of it is based upon experience of the system. Perhaps on occasion it has been used insensitively. Perhaps one of the reasons for its being used insensitively to begin with is that the Government did not monitor the operation of the system as well as should be.

My right hon. Friend pointed out the great importance of monitoring the system and of using it sensitively. Over the last dozen years or so we may have learned from some of our experiences of the need to monitor demand for and supply of office accommodation and to be sensitive to local needs, such as the needs of inner city areas, which we have been too ready to neglect in the past.

Perhaps, too, we made the mistake a dozen years ago of applying too low a limit for the requirement of office development certificates. I hope that, as a consequence of that experience and as a consequence of the reappraisal which my right hon. Friend has made of the need for office location policy today, we are now moving towards a policy which is relevant and which has benefited from experience.

Office location policy cannot, it seems to me, if it is to be successful, merely be confined to operation of an office development permit system, but that has been the implication of most of the speeches made by Opposition Members. It cannot be so confined, and my right hon. Friend made this absolutely clear. It is part of three aspects of office location policy with one of which the Bill is concerned. The Bill, admittedly, is concerned with ODP control, and hon. Members were right to concentrate their attention and their criticisms on that aspect of the policy. What is it? It is a disincentive to decisions to develop in South-East England.

Perhaps it is important to recognise—because figures have been quoted on a number of occasions this evening—that it acts as a disincentive and that, therefore, there may be and almost certainly are people or firms who, because of ODP control, make decisions to locate offices away from London without even applying for office development permits. Nevertheless, that is the purpose of the ODP policy.

But that is not the end of it, because the Location of Offices Bureau has a vital part to play in policy. I know that because of its advertisements that is the respect in which LOB is perhaps best known by hon. Members and, indeed, by the public in general. But it is fair to point out that the Location of Offices Bureau provides a very useful free information service to those interested in building or setting up offices in different parts of the country. This information service is perhaps not recognised for the importance it has, because of the general prominence of the LOB's advertisements.

The bureau has available for anyone who wishes to consult it a comprehensive list of office accommodation vacant in towns all over Great Britain and corresponding information about rents being asked. On top of this it can give help concerning Government assistance, planning permission, availability of staff, housing, transport, and anything else that anyone interested in moving his office needs to know. That is a vital part of office location policy. That is why my right hon. Friend is altering and broadening the remit of the Location of Offices Bureau. We believe that it has a vital part to play in this important job that needs to be done—that of getting a better distribution of office employment in the country at large.

There is a third aspect of the policy to which the right hon. Member for Crosby referred—the grants available from the Department of Industry. The right hon. Gentleman saw that as an alternative to office development policy, but I see it as a complement or at least as the third aspect of a successful policy.

The Department of Industry has been paying grants since 1973. But since October of last year those grants have increased. In consequence, there has been a doubling in the rate of applications for assistance to move to assisted areas. I believe that those three aspects have a vital part to play in office location policy. Indeed, Government dispersal has already been mentioned. That, too, has an important part to play. Only in that context can we see the real importance and value of the Bill.

I come back to what I said earlier. Clearly, it is important that the policy should be operated sensitively. Where it can reasonably be shown that a firm has a close link with an area in which it wants to operate, or that a large percentage of its employees need to be in that area, there is a case for the policy being operated as sensitively as possible.

The hon. Member for Reading, North (Mr. Durant) gave us an interesting analysis of problems in his constituency which no doubt affect many towns round London. With the great rise in transport

costs, there may need to be more office jobs available in those areas. The fact that we have raised the limit makes the policy immediately more flexible and should enable towns like Reading to develop offices where they need to do so. If there is a need for development because of a serious imbalance of opportunities in certain towns, or because unemployment has developed as people can no longer afford to travel long distances to work, I hope that we shall operate the policy intelligently and sensibly to cope with the situation.

I think that I should speak to those Members who, like myself, represent London constituencies and who are clearly worried about the situation. As has been pointed out, London has lost many manufacturing jobs. It has not lost quite as many office jobs. One reason for that—I think it worth quoting this, because it appears in an advertisement in tonight's Evening Standard—is what is said by the Location of Offices Bureau: We have details of available office space in 375 locations throughout the UK (including Greater London). And we know about local planning policies and Government incentives and controls.

I should emphasise that one final aspect of the policy is just that, because of the policy being pursued by the Government, because of ODP control and all the rest, we are in the long term influencing public opinion. Whereas 10 or 12 years ago people might not have thought seriously of going north to an assisted area, nowadays they are more ready to consider the possibility of dispersal to areas where the opportunities of employing labour are easier than they may be in London.

Question put, That the Bill be now read a Second time:—

The House divided: Ayes 155, Noes 121.

Division No. 142]	AYES	[10.00 p.m.
Anderson, Donald	Callaghan, Jim (Middleton & P)	Cunningham, Dr J. (Whiteh)
Archer, Peter	Campbell, Ian	Davidson, Arthur
Armstrong, Ernest	Canavan, Dennis	Davies, Ifor (Gower)
Ashton, Joe	Carter-Jones, Lewis	Davis, Clinton (Hackney C)
Atkins, Ronald (Preston N)	Clemitson, Ivor	Dempsey, James
Atkinson, Norman	Cocks, Rt Hon Michael (Bristol S)	Doig, Peter
Barnett, Guy (Greenwich)	Coleman, Donald	Dormand, J. D.
Benn, Rt Hon Anthony Wedgwood	Conlan, Bernard	Douglas-Mann, Bruce
Bennett, Andrew (Stockport N)	Corbett, Robin	Dunnett, Jack
Blenkinsop, Arthur	Cowans, Harry	Eadie, Alex
Boardman, H.	Cox, Thomas (Tooting)	Edge, Geoff
Boothroyd, Miss Betty	Craigen, Jim (Maryhill)	Ellis, John (Brigg & Scun)
Bottomley, Rt Hon Arthur	Crawshaw, Richard	Evans, Gwynfor (Carmarthen)
Butler, Mrs Joyce (Wood Green)	Crowther, Stan (Rotherham)	Ewing, Mrs Winifred (Moray)
Callaghan, Rt Hon J. (Cardiff SE)	Cryer, Bob	Faulds, Andrew
Fernyhough, Rt Hon E.	Leadbitter, Ted	Skinner, Dennis
Flannery, Martin	Lestor, Miss Joan (Eton & Slough)	Smith, John (N Lanarkshire)
Fletcher, Ted (Darlington)	Lewis, Ron (Carlisle)	Snape, Peter
Foot, Rt Hon Michael	Loyden, Eddie	Spriggs, Leslie
Ford, Ben	Lyons, Edward (Bradford W)	Stallard, A. W.
Forrester, John	Mabon, Rt Hon Dr J. Dickson	Steel, Rt Hon David
Fraser, John (Lambeth, N'w'd)	McCartney, Hugh	Stewart, Rt Hon M. (Fulham)
Freeson, Reginald	McDonald, Dr Oonagh	Stoddart, David
Garrett, W. E. (Wallsend)	McElhone, Frank	Stott, Roger
Gilbert, Dr John	MacFarquhar, Roderick	Summerskill, Hon Dr Shirley
Gourlay, Harry	Marks, Kenneth	Taylor, Mrs Ann (Bolton W)
Graham, Ted	Marshall, Dr Edmund (Goole)	Thomas, Mike (Newcastle E)
Grant, George (Morpeth)	Marshall, Jim (Leicester S)	Thomas, Ron (Bristol NW)
Grocott, Bruce	Maynard, Miss Joan	Thorne, Stan (Preston South)
Harper, Joseph	Miller, Dr M. S. (E Kilbride)	Tierney, Sydney
Harrison, Walter (Wakefield)	Mitchell, Austin Vernon (Grimsby)	Tinn, James
Hatton, Frank	Molloy, William	Torney, Tom
Heffer, Eric S.	Moonman, Eric	Tuck, Raphael
Hooley, Frank	Morris, Charles R. (Openshaw)	Urwin, T. W.
Howells, Geraint (Cardigan)	Murray, Rt Hon Ronald King	Walker, Terry (Kingswood)
Hoyle, Doug (Nelson)	Newens, Stanley	Ward, Michael
Huckfield, Les	Noble, Mike	Weetch, Ken
Hughes, Mark (Durham)	Palmer, Arthur	Wellbeloved, James
Hughes, Robert (Aberdeen N)	Park, George	White, Frank R. (Bury)
Hughes, Roy (Newport)	Parry, Robert	White, James (Pollok)
Hunter, Adam	Pavitt, Laurie	Whitlock, William
Jackson, Colin (Brighouse)	Roberts, Albert (Normanton)	Wigley, Dafydd
Jackson, Miss Margaret (Lincoln)	Robinson, Geoffrey	Williams, Alan Lee (Hornch'ch)
Jenkins, Hugh (Putney)	Roderick, Caerwyn	Williams, Sir Thomas (Warrington)
John, Brynmor	Rodgers, George (Chorley)	Wilson, Alexander (Hamilton)
Johnson, James (Hull West)	Rodgers, Rt Hon William (Stockton)	Wilson, William (Coventry SE)
Jones, Alec (Rhondda)	Rooker, J. W.	Wise, Mrs Audrey
Jones, Barry (East Flint)	Ross, Stephen (Isle of Wight)	Woodall, Alec
Jones, Dan (Burnley)	Ryman, John	Woof, Robert
Kaufman, Gerald	Shaw, Arnold (Ilford South)
Kilroy-Silk, Robert	Shore, Rt Hon Peter	TELLERS FOR THE AYES:
Lambie, David	Silkin, Rt Hon S. C. (Dulwich)	Mr. Alf Bates and
Latham, Arthur (Paddington)	Silverman, Julius	Mr. James Hamilton.
NOES
Atkins, Rt Hon H. (Spelthorne)	Hannam, John	Rawlinson, Rt Hon Sir Peter
Baker, Kenneth	Harrison, Col Sir Harwood (Eye)	Rhodes James, R.
Banks, Robert	Hawkins, Paul	Rippon, Rt Hon Geoffrey
Bennett, Sir Frederic (Torbay)	Hayhoe, Barney	Roberts, Michael (Cardiff NW)
Benyon, W.	Heseltine, Michael	Rossi, Hugh (Hornsey)
Berry, Hon Anthony	Hodgson, Robin	Rost, Peter (SE Derbyshire)
Biffen, John	Hunt, John (Bromley)	Sainsbury, Tim
Biggs-Davison, John	Hutchison, Michael Clark	Shaw, Giles (Pudsey)
Blaker, Peter	Junes, Arthur (Daventry)	Shepherd, Colin
Boscawen, Hon Robert	Kershaw, Anthony	Silvester, Fred
Bottomley, Peter	King, Evelyn (South Dorset)	Sims, Roger
Bowden, A. (Brighton, Kemptown)	Kitson, Sir Timothy	Skeet, T. H. H.
Braine, Sir Bernard	Knox, David	Smith, Dudley (Warwick)
Brittan, Leon	Langford-Holt, Sir John	Smith, Timothy John (Ashfield)
Brocklebank-Fowler, C.	Lawrence, Ivan	Speed, Keith
Brooke, Peter	Lawson, Nigel	Spence, John
Bryan, Sir Paul	Le Marchant, Spencer	Spicer, Michael (S Worcester)
Butler, Adam (Bosworth)	Lester, Jim (Beeston)	Sproat, Iain
Carlisle, Mark	Luce, Richard	Stainton, Keith
Channon, Paul	Macfarlane, Neil	Stanbrook, Ivor
Clark, Alan (Plymouth, Sutton)	Mackay, Andrew James	Steen, Anthony (Wavertree)
Clegg, Walter	Marten, Neil	Stradling Thomas, J.
Cooke, Robert (Bristol W)	Maxwell-Hyslop, Robin	Taylor, R. (Croydon NW)
Costain, A. P.	Miller, Hal (Bromsgrove)	Tebbit, Norman
Crowder, F. P.	Moate, Roger	Temple-Morris, Peter
Douglas-Hamilton, Lord James	Molyneaux, James	Thatcher, Rt Hon Margaret
Durant, Tony	Moore, John (Croydon C)	Thomas, Rt Hon P. (Hendon S)
Eden, Rt Hon Sir John	More, Jasper (Ludlow)	Trotter, Neville
Elliott, Sir William	Morgan, Geraint	van Straubenzee, W. R.
Eyre, Reginald	Morrison, Charles (Devizes)	Vaughan, Dr Gerard
Fairbairn, Nicholas	Nelson, Anthony	Viggers, Peter
Farr, John	Newton, Tony	Walder, David (Clitheroe)
Finsberg, Geoffrey	Oppenheim, Mrs Sally	Wall, Patrick
Fisher, Sir Nigel	Page, Rt Hon R. Graham (Crosby)	Weatherill, Bernard
Fookes, Miss Janet	Page, Richard (Workington)	Wells, John
Forman, Nigel	Parkinson, Cecil	Whitelaw, Rt Hon William
Fry, Peter	Pattie, Geoffrey	Young, Sir G. (Ealing, Acton)
Goodhart, Philip	Percival, Ian	Younger, Hon George
Gorst, John	Powell, Rt Hon J. Enoch
Gray, Hamish	Pym, Rt Hon Francis	TELLERS FOR THE NOES:
Grylls, Michael	Raison, Timothy	Mr. Carol Mather and
Hampson, Dr Keith	Rathbone, Tim	Mr. Peter Morrison.

Question accordingly agreed to.

Bill read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).