HC Deb 12 June 1978 vol 951 cc648-50
Mr. Speaker

Mr. Kinnock—Question No. 24.

Mr. Kinnock

Question No. 24, Sir. This is unbelievable.

The Under-Secretary of State for Wales (Mr. Alec Jones)

If getting to Question No. 24 is unbelievable to my hon. Friend, I assure him that it is unbelievable to me as well.

24. Mr. Kinnock

asked the Secretary of State for Wales if he will introduce legislation to seek to prevent house building companies from making price increases which exceed demonstrable cost increases between the time of an initial agreement with a purchaser to sell and the completion of sale to that purchaser.

Mr. Jones

It would be extremely difficult to devise effective and enforceable legislation in such cases. Excessive price increases are best prevented by restoring stability in the housing market—which is the objective of the recent agreement with the building societies on lending levels.

Mr. Kinnock

Is my hon. Friend aware that this may be yet another case of one of those famous misprints? I thought that I had put this Question down to my right hon. Friend the Secretary of State for Prices and Consumer Protection.

Is my hon. Friend aware that there are now several instances of firms building new houses and then, in between the time of the original agreement to sell and the eventual sale, imposing substantial increases in price, amounting to several thousand pounds? Whereas in ordinary domestic transactions it is difficult to stop gazumping, it must be possible to introduce an interim contract which would hold firms to the original price plus any demonstrable cost increases. This would be a significant advance in protection for house buyers and families.

Mr. Jones

Perhaps I should explain that my hon. Friend's Question was transferred to the Welsh Office by virtue of my right hon. Friend's responsibilities for housing in Wales. Gazumping is a problem which has concerned many of us for a very long time, but we nave to be careful in these matters that we do not introduce, or attempt to introduce, a remedy for gazumping which would be far worse than the disease.

My hon. Friend is probably aware that, following detailed investigations of these matters in 1974 and in 1975, the Law Commission concluded that effective legislation against gazumping could work against the interests of the purchaser in many cases.

Mr. Costain

Does the Minister appreciate that the way to control prices is to increase competition? Will he have a word with the Secretary of State for the Environment to ensure that land is made available for builders, so that they can build more and so that there can be more competition? The sort of case to which the hon. Member for Bedwellty (Mr. Kinnock) referred, whether true or not, would not then happen.

Mr. Jones

I believe that my hon. Friend's question was particularly concerned with the aspects which have arisen in Wales. The Community Land Act 1975 is working extremely effectively in Wales, and land is available for building in Wales.

Mr. Kinnock

On a point of order, Mr. Speaker. Is it in order for the hon. Member for Folkestone and Hythe (Mr. Costain), in referring to the case I raised, to use the words "whether true or not"? I would certainly not dream of introducing or mentioning a case if it were not true.

Mr. Speaker

I have no doubt that the hon. Member for Folkestone and Hythe (Mr. Costain) did not intend to make any imputation concerning the honour of the hon. Member for Bedwellty (Mr. Kinnock).

Mr. Costain

Further to that point of order, Mr. Speaker. I certainly had no such intention. As a matter of fact, the hon. Gentleman did not mention the name of the case. I gathered that it was a supposition and may or may not have happened.

Sir A. Meyer

Will my hon. Friend—and no doubt the hon. Member for Bedwellty (Mr. Kinnock)—agree with me that it is most unsatisfactory for Questions on general housing policy to be transferred to the Welsh Office purely because they are asked by Welsh Members?

Mr. Jones

I must admit that I am not responsible for the transferring of the Question. I am merely responsible for the answer.

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