HC Deb 28 February 1978 vol 945 cc274-88

5.5 p.m.

The Under-Secretary of State far Scotland (Mr. Hugh D. Brown)

I beg to move Amendment No. 1, in page 1, line 14, leave out from 'State' to 'shall' in line 1 on page 2.

Mr. Deputy Speaker (Sir Myer Galpern)

With this we may take Amendment No. 4, in page 2, line 23, at end insert— '(3A) In the event of the Secretary of State and the Convention of Scottish Local Authorities being unable to agree on an estimate of the amounts mentioned in paragraphs (a) and (b) of subsection (2) above for any year, either party may request that the estimates be submitted to arbitration by a procedure to be agreed by both parties'.

Mr. Brown

This amendment replaces an amendment that was carried in Committee. The subject was discussed fully in Committee. It is certainly an important matter. In Committee, my hon. Friend the Member for Edinburgh. Central (Mr. Cook) said that he was concerned to ensure that a total sum of housing support grant is not simply imposed by the Secretary of State on local authorities. He wanted to prevent any arbitrary reduction of total grant by a Secretary of State assuming, say, his own lower estimates of expenditure and higher estimates of income.

As we have gone into this matter fully, I would suggest that it is enough for me to say that it is not entirely a matter for the Secretary of State. The Bill spells out the elements of calculations that he must take into consideration in setting the amount of grant, and he is committed, through subsection (3), to consultation with local authorities.

We have recently discussed this question with representatives of the Convention of Scottish Local Authorities, and they are satisfied with my assurances that the Secretary of State would fully consult local authorities before settling the amount of housing support grant, and the right medium of consultation would be the Convention, even though COSLA would not be specifically named in the legislation. There is only one association at present and that is reflected in the wording of the Bill. We would certainly reflect the Convention's views in the report that would accompany the HSG order each year.

Our commitment to working with local authorities is well borne out by our record of joint working with COSLA over the past two years or so, particularly on housing support grant and on housing plans. I pay tribute to how helpful and constructive the Convention has been. Therefore, I think that Amendment No. 1 is essential.

Amendment No. 4 is identical to an amendment moved by my hon. Friend in committee. I am afraid that, as before, I cannot accept the amendment. I have stressed the responsibility of the Secretary of State for estimating housing support grants. I think that it should be made clear that the only proper arbiter in this dispute would be the House of Commons. I thought that that was something which we in the Committee were all agreed was desirable. That is because it is to the House that the Secretary of State would be answerable.

As my hon. Friend the Member for Aberdeen, South said in Committee, the dispute, if there should be a dispute, would be a political matter and, therefore, it would have to be resolved in a political arena.

Mr. Robert Hughes (Aberdeen, North)

Simply for the record, my constituency is Aberdeen, North. I hate to be associated with South Aberdeen.

Mr. Brown

I beg my hon. Friend's pardon. That is the first clanger that I have dropped today. I thought that I said Aberdeen, North. However, in any case, as my hon. Friend pointed out, if there were a dispute it would be a political matter and should be resolved, therefore, in a political arena.

I give the House this assurance, which I have already given to the Convention. If there is disagreement between the Sec- retary of State and COSLA on the basis of the estimates, the Convention's views will be indicated in the report that accompanies the order. I am not suggesting that we should get into an industrial relations situation, but I am, more or less, hinting that if there should be disagreement, it will be registered and shown clearly in the report that will accompany the order.

If there was independent arbitration, it is fair to ask whether we should assume that the House would automatically accept the findings of arbitration. That would have the effect of the House merely rubber-stamping decisions that have been made outside in a non-political arena.

Certain hon. Members who were on the Committee will agree that the Government went a long way towards meeting this objective of open government. We provided that the order be laid in draft. We provided that a variation order could not be combined with a main housing support grant order. We undertook to allow the maximum period for scrutiny by laying the order many months before money became available. Having made these improvements—not concessions, because we are all at one in the attempt to increase opportunity for parliamentary scrutiny—I hope that the House will accept my explanation, carry Amendment No. 1 and reject Amendment No. 4.

Mr. Robin F. Cook (Edinburgh, Central)

I wish to speak particularly to Amendment No. 4, which stands in my name. This amendment seeks to place in the Bill an amendment which I moved in Committee. In Committee the paving amendment was carried but the substantive amendment, moved at the subsequent sitting, was defeated. We are now in the position when the Minister is moving to delete the paving amendment and I am seeking to insert the substantive amendment, the principle of which was accepted in Committee.

It is appropriate, at the outset of our consideration of this Bill on Report, that we should be faced with amendments which go to the heart of the Bill. What we are faced with in this Bill is an attempt to provide by legislation that housing subsidies will in future be settled not by legislative means but by what might be described as Executive action—by means of an order drawn up by the Government and laid before the House. We had a very full debate on this matter in Committee. We debated it for the best part of two hours.

The point that came consistently through our debate was that there was considerable unhappiness, I believe shared on both sides of the Committee, with the existing procedures for dealing with orders laid by the Government. The fact is that such orders are likely to be debated for only one-and-a-half hours, probably late at night or, if they follow the pattern of the rate support grant order, probably on the last sitting day before the recess. In the course of those one-and-a-half hours probably half of the time will be taken up by the Front Benches, leaving at best a couple of Back-Bench speakers from either side of the Chamber. Further, no amendment can be tabled to the order and at the end of the debate the House is faced with the invidious task of deciding whether to approve the order with all its defects or to reject it and any benefits that it may confer. In other words, the House is faced with a decision whether to approve the order or grant of some kind or whether to make absolutely no housing support grant available.

That position represents a false choice. We have been through that exercise with the rate support grant order. In 1976 the House was faced with precisely that decision. The appropriate response, given the inadequacy of our procedure for considering orders laid before the House, would be for us to sit down and consider the procedure by which we could best evaluate housing support grant orders. In Committee I attempted to table an amendment which would refer those orders to a Select Committee which would have the power to call witnesses and ask the Serjeant at Arms to secure papers, should that be necessary. In the event—and this will not come as a surprise to you, Mr. Deputy Speaker—that amendment was not selected because it went beyond the subject matter of the Bill and it would not be competent for us, either in Committee or on Report, to attempt to alter the procedures of the House to provide for a more thorough surveillance of housing support grant orders than exists for any other form of order laid before the House.

Given that we are unable to change the procedures by which the House tests the orders laid before it and given this widespread dissatisfaction with those procedures, it is only proper and right that we should turn our minds to discovering alternative checks and balances which can be put in to provide proper scrutiny of whatever grant is proposed by the Secretary of State. If we cannot do that through this House, regrettably, we must seek another forum in which it can be done. I say at once that I have considerable sympathy with what my hon. Friend the Under-Secretary has said. I believe that the right place for the arbitration to be settled should be this House, if we could find a proper procedure by which to do it. Even now my objection to the Government amendment and my motivation in putting forward my amendment is precisely that I am dissatisfied with our procedures. If only we could find an alternative procedure to strengthen the present methods I would not seek to write into the Bill the provision for independent arbitration.

5.15 p.m.

In default of such improvement we have to consider some form of independent arbitration. The main reason why I do so is that I am doubtful about the extent to which the consultations with COSLA will be meaningful. The one thing we have learned during the course of the past two years in debating the rate support grant negotiations is that COSLA negotiates from a position of weakness. It is entirely dependent on the Government for its money. It has no sanctions which it can impose if the Government take a position inimical to COSLA's interests. What I seek to do in my amendment is to provide a small sanction which COSLA could exert in the course of those consultations, namely, the threat that it might take the final settlement to arbitration.

I would not imagine that COSLA would seek to use such a threat every year. I would not imagine that it would go to arbitration more than once in a decade. Nevertheless, as a final sanction that eventual backstop would be there and would exercise some form of check and balance in the course of the annual negotiations. Without that I very much fear the effect of this legislation in giving quite so much widespread discretion to the Secretary of State of the day, whoever he may be. It is appropriate that we should remind ourselves that the Secretary of State may not always by my right hon. Friend.

If I were confident that my right hon. Friend would be with us for eternity and that there would be no constitutional shake-up which might devolve this function to another forum, that there would be no subsequent General Election which might threaten my right hon. Friend's tenure in office, or that there might never be some unfortunate virus which struck down my right hon. Friend the Prime Minister who might be replaced by someone who might initiate a tremendous shake-up of ministerial posts—if I could be sure that none of these things would happen, I would have much more confidence in the procedure we are considering because my right hon. Friend has been reasonable in Committee and has made maximum efforts to consult those of us who were on the Committee.

What we are doing is legislating for these powers to be held by the man who holds the office of Secretary of State. That may well be, at some point in the future—we do not know how long—a person other than my right hon. Friend. I hope that the House will consider the principle put forward in the amendment and will come to the same conclusion as that of the Committee when it reached a decision on these amendments.

There is an additional point. When the Committee reached its decision on the group of amendments it did so before receiving the submission on the Bill from COSLA. At the time we understood that COSLA had been fully consulted and entirely accepted the principle of the Bill. Subsequently, after we examined this group of amendments, we received the COSLA submission. I believe that I am correct in saying that the COSLA comment on Clauses 1 to 3 was that while it accepted the principle of change it nevertheless registered unease about the replacement of a fixed form of subsidy, which provided certainty, with a new form of subsidy which could be changed from year to year. I hope that the amendment standing in my name will go a considerable way towards removing the unease expressed by COSLA.

Mr. Teddy Taylor (Glasgow, Cathcart)

As the hon. Member for Edin- burgh, Central (Mr. Cook) is aware, we supported his amendment in Committee because we thought that it raised an issue which should be considered. We share the fears of COSLA about replacing a known system of housing subsidy—one laid down in legislation and understood by local authorities, one which cannot be removed by Government action—with a procedure whereby the Secretary of State can fix an amount annually which he thinks should go to Scottish housing. I am sure that the Under-Secretary would agree that this is the position. We are getting rid of a system embodied in legislation and replacing it with a system which requires a blind confidence in the Secretary of State and his commitment to Scottish housing.

In other words, we are giving away something which had a guarantee and replacing it by a pig in a poke which depends on the commitment to housing of the Government of the time. This is the main reason for which we supported the hon. Member for Edinburgh, Central in Committee. The only assurance that we had at the time was that of the Minister, who said, in effect "Don't worry. We will look after Scottish housing. We have already shown by our policies and our commitment that we will do that." I think that at the time there were some Labour Members who accepted that assurance. The hon. Member for Central Ayrshire (Mr. Lambie) appeared to think that the assurance was all right, given the Government's commitment to housing.

Since that debate I have been looking through the housing plan presented by the Government at the time of the General Election and at what has happened since then. As a result, I am even less confident now than I was previously about the Government's ability to deliver a sensible housing policy. Every Labour Member—and in particular the hon. Member for Edinburgh, Central and the hon. Member for Central Ayrshire—will be aware of the basis on which the Government were elected. I quote from the manifesto of the Labour Party. Speaking of the Conservatives, it said: In 1970 they promised us better housing, yet the housing figures for 1973 were the most disastrous for Scotland since 1959, When the last Tory Government was in office. The manifesto went on to indicate that the new Government's plan was to put new emphasis on the expansion and improvement of housing in Scotland. We shall not let up until that aim has been achieved. Here we had the Labour Party picking, for very special reasons, the worst year for housing—in other words, the figure for 1973—and saying that a Labour Government would expand housing on that basis and would not rest until an improvement had been achieved. But only yesterday, by fortunate accident, we had from the Government their housing figures for 1977. I looked whether there had been a dramatic expansion on the disastrous figure for 1973. I found that, far from there having been a leap forward from the figure of 30,003 in that very low year, the figure of house completions last year—I am sure that the hon. Member for West Stirlingshire (Mr. Canavan) will be horrified to learn this—was only 26,772.

Instead of there having been a massive expansion or improvement, we find that the only record being beaten by the Government is for the number of unemployed Scottish building workers. I am sure that the hon. Member for West Stirlingshire will also want to protest about that.

Mr. Dennis Canavan (West Stirlingshire)

Will the hon. Gentleman give a breakdown of the figure of 26,772 into those local authorities which are controlled by the Tories and those which are controlled by the Labour Party?

Mr. Deputy Speaker

I do not think that that would be in order in discussing these amendments.

Mr. Taylor

I think that the hon. Member for West Stirlingshire is simply trying to excuse—

Mr. Deputy Speaker

The hon. Member for Glasgow, Cathcart (Mr. Taylor) is now introducing something which smacks of electioneering. Let us get on.

Mr. Taylor

Certainly. I think you are quite right, Mr. Deputy Speaker, in saying that we should leave it, but I am sure that when we come to the General Election the people in Scotland, who have been so shamefully misled on housing and who have found the Government's housing policy to be a disgraceful shambles, will take note of the fact. There can be no question that the estimates, plans and proposals of the Government on housing have turned out to be a shambles, because we have a figure of house completions for 1977 which is well below the figure for a disastrous year. I am sure that the hon. Member for Central Ayrshire and many of his colleagues will find great difficulty in justifying to their constituents the shameful record of the Government. As I said earlier, the Government's real achievement is to create a record number of unemployed building workers.

In these circumstances we have to ask, in relation to the amendment, whether we are quite happy to accept the assurance of the Government and the good will of this rather confused housing Minister, who means well but is not able to achieve anything for Scotland. One of the problems that we have nowadays is that we find ourselves faced repeatedly with nice, pleasant, smiling and well-meaning Ministers who are trying to do their best but who are not succeeding in achieving anything. Things only go from bad to worse. The one exception is the Secretary of State for Scotland. He manages to get Scotland into a very serious situation without even trying to smile.

The only assurance that we have, therefore, is the Government's good will. We were very unhappy about this question in Committee. The only thing which reassures us now is that we are quite convinced that the Government's tenure of office will not be a very long one, and that when the legisation comes into effect there will once again be a Conservative Government in office, and that they will deliver the goods on housing to the people of Scotland. We are proud of our record in that respect. Although the amendment gives considerable powers, freedom and scope to the Government—

The Deputy Speaker

I draw the hon. Gentleman's attention to the fact that the Secretary of State for Scotland is now smiling broadly.

Mr. Taylor

Yes, but he will not be smiling for long. The one thing which reassures us—and which, I am sure, will reassure sensible Members such as the hon. Member for Edinburgh, Central—is that the freedom of action that we are giving to the Secretary of State will apply also to Conservative Governments. We are sure that when we have a Conservative Government, with the freedom of action which the clause gives, Scotland will have no fears whatsoever.

We wanted to have the amendment of the hon. Member for Edinburgh, Central debated and discussed, but as we have, on the one hand, the assurance of the likelihood of a Conservative Government being returned to power, and, on the other hand, the strength of feeling in Scotland about the Government's housing policy—it is so strong that it might make the Government budge—we shall in those circumstances be happy to accept the Government's amendment. As I have indicated, that is basically because we are convinced that either there will be a change of Government or the sheer force of public opinion in Scotland will oblige the Government to adopt a better housing policy than they have in recent years.

Mr. Robert Hughes

One cannot but admire the effrontery of the hon. Member for Glasgow, Cathcart (Mr. Taylor). I suspect that beneath the common man approach that he brings to everything is a secret desire to be ennobled and to sit in another place along the corridor. There could be no better forum for the grand old Duke of York, who marches his troops to the top of the hill and, as soon as he sees someone approaching, rapidly goes back to where he came from.

Mr. Robin F. Cook

I think that Humpty-Dumpty would be more appropriate.

Mr. Hughes

I do not know how the hon. Gentleman is able to make the speech that he has just made and then say at the end of it that he will support the Government's amendment. But, as we know, all things are possible to the hon. Member for Cathcart as long as he is able to get up and waffle.

Mr. Taylor

I should have made it clear that our position is that we shall not resist the Government's proposal. It would be very difficult for us to support the Government on anything relating to housing, because their record is quite shameful.

Mr. Hughes

I am glad that the hon. Gentleman has put the record straight. He can only oppose and cavil, but for once it seemed that he was actually about to do something positive. Now it appears that he will remain seated on the Front Bench when the Division comes. He will not be leading his troops anywhere. There must be a title for that sort of behaviour but I cannot think of it at the moment.

I will not go over the story which we went over in Committee, but the fact is that my hon. Friend the Member for Edinburgh, Central (Mr. Cook), even after having had time to think about it, has not come up with a positive form of arbitration. Before I agree to write anything into a Bill which leads to people being appointed from outside the political arena to arbitrate on housing policy, I want to know what that arbitration procedure is to be. I still stick firmly to my remarks in Committee that if there is a conflict between COSLA and the Government, the final decision will be a political one, and therefore it must be settled in this House.

In Committee my hon. Friend put forward the names of one or two people whom he thought might be the arbitrators. He mentioned my right hon. Friend the Member for Kilmarnock (Mr. Ross), who is a former Secretary of State for Scotland. I would not wish to cast any aspersions on my right hon. Friend, even if he is not here. I would not dare do any such thing. The other name mentioned was that of Sir George Sharp. Again, I have nothing against Sir George Sharp, but I do not believe that anyone from outside is the right person to arbitrate in political matters.

I think that the amendment is defective in achieving the purpose which my hon. Friend seeks to achieve. He is really saying that the head-on collision between the Government and COSLA will happen only rarely, but that when it happens feelings will be running very high, and that the Secretary of State will dictate arbitrarily what is to happen.

The amendment says that the arbitration procedure has to be agreed by both parties". If the Government wanted to be tough they could say "You can accept this clause if you like". But COSLA, being one of the parties, may request that the matter goes to arbitration. If the Government do not agree to the arbitration procedure we are no further forward.

5.30 p.m.

The Government can rest on their position by saying, "All right, unless you accept this, we shall not agree to the arbitration procedure and, therefore, there will be no money". I do not think there is any way around the problem that will arise if and when the decision is reached that there is insufficient money to go round and for housing to get its fair share—whichever Government or whichever Assembly takes the decision that only so much money is available.

There is no way in which any individual arbitration machinery can resolve that problem. It can only be resolved politically. I would rather stick to this than write something into the Bill which I believe would be totally ineffective at the end of the day.

Amendment agreed to.

Mr. Hugh D. Brown

I beg to move Amendment No. 2, in page 2, line 20 leave out 'and'.

The Deputy Speaker

With this we may take Amendment No. 3, in page 2, line 23 at end insert'; and (c) the latest information available to him as to changes in the general level of earnings which would affect the amount of relevant income which could reasonably be expected for that year.'.

Mr. Brown

Amendment No. 2 is a purely drafting amendment to pave the way for Amendment No. 3, which requires the Secretary of State to take into consideration the latest available information on the general level of earnings. These amendments arise out of an undertaking that I gave in Committee in response to an amendment tabled by my hon. Friend the Member for Aberdeen, North (Mr. Hughes) in the absence of my hon. Friend the Member for Edinburgh, Central (Mr. Cook). That amendment was withdrawn when I undertook to look further into the matter.

I pointed out the technical difficulties of drafting such an amendment in a nonrestrictive way, in other words, to leave room for genuine negotiations between the Secretary of State and the Convention of Scottish League Authorities.

Amendment No. 3 accomplishes this and establishes the principle that the Secretary of State must take into account changes in the general level of earnings before estimating the aggregate relevant income of local authorities each year. Subsection (6) provides that the HSG order should be accompanied by a report of the considerations which have led to it. This report would have to explain the estimate of relevant income by reference to information on changes in the general level of earnings. I hope that satisfies the undertaking that I gave.

The Government believe that earnings provide the most appropriate and reliable indicator of people's ability to meet the cost of their housing and that this is a key factor in determining the level of relevant income which local authorities can reasonably expect to receive.

The amendment is not restrictive. It makes clear that earnings must always come into the reckoning. It does not rule out other relevant factors. I hope the House will accept that this fulfils the undertaking that I gave in Committee.

It gives the local authorities an important assurance that the level of relevant income will always take into account changes in the general level of earnings.

Mr. Jim Craigen (Glasgow, Maryhill)

Will my hon. Friend indicate whether he was talking about the general level of earnings in terms of the United Kingdom, the regions or the sub-regions, because there may be considerable variations?

Mr. Brown

Obviously I would not attempt to pronounce on that. It is one of the factors that will be part of the discussions on the relationship between earnings and relevant income. I do not think that we can separate the United Kingdom level of earnings. I know that Scottish earnings have risen, and in some areas are higher than in most other parts of the country. Nevertheless, I am giving a general assurance about the level of earnings.

Given the skills and knowledge of COSLA, if there is any way in which it can seek to exploit an increased commitent by the Secretary of State, I am sure that it will be able to deploy the arguments in favour.

I am making it clear, and giving the assurance, that the Convention will be free to ask for further factors to be taken into account. I believe that will cover the point made by my hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen). Given that assurance, I hope that the House will accept the amendments.

Mr. George Younger (Ayr)

Far be it from me ever to look a gift horse in the mouth. The Minister has clearly tried to meet one of the points which several hon. Members made in Committee. It is extremely interesting that the Minister has decided to accept this point about taking into account the level of earnings.

He may recall that when we discussed this at considerable length in Committee, the discussion centred around taking into account not only earnings but prices. There was some discussion about whether it should be earnings and prices and what the balance between the two was.

The fact that lay behind this discussion was the truly sobering fact that in the past three years—for the first time in the memory of any of us—the actual level of earnings went up by less than the increase in prices. For most of our lifetime the reverse has been the case. Certainly, during the years of the Conservative Government, it was invariably the fact that the level of earnings went up by more than the level of prices and that the general standard of living of the people went up as a result.

Yet it is now a Labour Government who are having to come forward and admit that in considering the housing support grant for the future it would be the level of earnings rather than the level of prices that would be taken into account when assessing how much a local authority can expect to get in revenue.

I believe the Minister has been enabled and encouraged to accept this change because, from his experience of government over the last three or four years, earnings in many ways provide a more favourable statistic than prices. Since prices were allowed to rise further, the standard of living of every person in the country dropped as a result of the Government's policies.

I accept that this is a genuine attempt to meet the wishes of the Committee. We are obliging the future discussions on housing support grant to take into account the level of earnings. But the level of earnings alone could be very misleading, particularly if a future Labour Government were to pile yet more taxation on the back of the ordinary working person as they have done so conspicuously and successfully in the last three or four years. If they do so, then even the level of earnings could be a misleading figure because net earnings are what matters to ordinary people, not gross earnings, which the Labour Government will take more and more of in taxation.

Mr. Harry Gourlay (Kirkcaldy)

A great deal of what the hon. Gentleman has said is suitable for a propaganda speech but not for a speech in the House of Commons, where the Chancellor in this financial year announced £1,000 million tax cuts. That cannot be said to have added to taxation.

Mr. Younger

I do not think the hon. Gentleman wants me to go too far into that argument. He will be more aware than anyone that the average family's tax burden under this Government has gone up from £8 to about £17. A figure of £1,000 million off taxation is absolutely nothing compared with what has been put on. It has been estimated that there would have to be five times that amount deducted before this Government were even back to the level of taxation under the previous Conservative Government.

In the context of this amendment, we are grateful to the Minister for agreeing that the level of earnings will be taken into account. But we hope sincerely that there will not be many more months of Labour Government giving rise to a further reduction in the standard of living of the ordinary manual worker—a reduction which, as I say, has not happened previously since the 1930s.

Amendment agreed to.

Amendment made: No. 3, in page 2, line 23, at end insert ';and (c) the latest information available to him as to changes in the general level of earnings which would affect the amount of relevant income which could reasonably be expected for that year.'.—[Mr. Hugh D. Brown.]

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