HC Deb 08 March 1978 vol 945 cc1411-4
8. Mr. Ovenden

asked the Secretary of State for the Environment what are the latest figures for housing starts and completions in the public and private sectors.

Mr. Freeson

The figures for January 1978 were published on 6th March. After seasonal adjustments have been made, there were 11,000 public sector starts and 11,400 completions in Great Britain; for the private sector the figures are 11,500 starts and 12,900 completions.

Mr. Ovenden

I congratulate the Government on the number of completions achieved in the public sector in the last three years, because it is a 50 per cent. improvement on the figure achieved by the Conservative Government in their last year of office.

Is my right hon. Friend aware that there is considerable concern on the Labour Benches about the decline in public sector starts, as is evidenced by last year's figure and the disappointing figure issued in January this year? Does he not think that the time has come to lift all restriction on local authority building in non-stress areas to compensate for the failure of Tory authorities in stress areas to enable them to meet their commitments?

Mr. Freeson

I have expressed my concern on this subject for some time. It is a serious matter that there is a prospect of a reduction in the number of starts, not because of lack of resources provided by the Government but following the failure of a number of local authorities to take up those resources, with effects being felt in underspending and lack of housing investment. Before I consider the suggestion put forward by my hon. Friend in seeking to solve the problem, I should like to consider other possibilities. We are now examining the matter closely.

Mr. Beith

Is the Minister aware that the Berwick-on-Tweed Borough Council is determined to build more houses but finds it impossible to obtain tenders because of the housing cost yardstick? Will he consider meeting a deputation from the council?

Mr. Freeson

I do not know about the necessity for meeting a deputation from that council. There are other authorities which face similar problems in the region. I am aware that there are problems in the Northern Region that are more deeply felt than perhaps elsewhere in the country. We are examining the matter closely. We shall shortly have the quarterly review of the housing cost yardstick levels and I hope to take action following that review.

Mr. James Lamond

Since it is clear that Tory-controlled local authorities are dragging their feet on new housing starts, why does not my right hon. Friend step directly into house building by setting up an English special housing association on similar lines to the Scottish Special Housing Association, which can take over from the Tory councils when they fail in their duty to the public?

Mr. Freeson

If one were to pursue that proposition—and this is not the first time it has been made—it would take some time, even if adopted, to implement and bring into action. In the meantime, there are other measures that we must consider in seeking to keep the level of housing activity up to that for which we have provided resource levels.

Mr. Rossi

Does the Minister agree that it is wrong to expect local authorities to increase their borrowings for new building and yet to retain their rate demands within the limits required by the Government? Does he agree that the fall-back in the number of starts has occurred in the private as well as in the public sector? Does he not remember that Shelter condemned the Government's housing record in 1977 as being the worst for 15 years? Furthermore, does he believe that the current policy of mortgage restriction helps private industry to build more houses?

Mr. Freeson

There are three or four supplementary questions tied up in the hon. Gentleman's comments. The answer to his point about the public sector is "No", because I do not think that the present state of the local rates is a reason for the hold-up in public sector starts. There are other reasons. Uppermost in my mind at present in this context are the policy decisions and influences stemming from the Conservative Central Office, from the hon. Gentleman and his colleagues on the Opposition Front Bench, and from Conservatives in the town halls. As for the other supplementary questions put to me by the hon. Gentleman, I shall deal with them when they are put separately.

Mr. Frank Allaun

If builders know that there are sufficient mortgages available, does it not encourage them? Is not the best way to help keep down house prices to increase the supply of private and council houses rather than to restrict the supply of mortgages?

Mr. Freeson

I do not follow my hon. Friend's reasoning. [HON. MEMBERS: "Oh."] Opposition memories are short. There has been much talk from the Opposition, but there was little action by the Tory Government in the early 1970s. We all know that what happened then was an explosion in house prices and a major collapse in house building in the private sector, from which we are still recovering.

Mr. McCrindle

If I may attempt to link the matter of starts and completions in the private sector with the subject of house prices, may I ask the Minister of State what effect on house prices will be caused by the fact that the Government are leaning on the building societies? How does that square with the movement towards building societies and the legislation on this subject which is now passing through the House seeking to provide grants and loans to first-time buyers, which may affect prices in the opposite direction?

Mr. Freeson

If I may take the hon. Gentleman's last point first, these mat- ters were examined and discussed at considerable length when the legislation to which he refers was before the House on Second Reading. Those matters will also be subject to a good deal of scrutiny when the Bill goes into Committee.

At this stage I merely wish to say that the scheme set out in the Bill to assist first-time buyers is planned to cover the kind of problem with which the hon. Gentleman is concerned. The scheme will operate in such a way as to allow adjustment in the market to take place over a period of two years or so.

On the other point mentioned by the hon. Gentleman, I prefer to save my comments until the Building Societies Association has considered this matter, which I understand will be not very long from now. I thought that we were all concerned—not only in this House but outside it—to attain stability not only in house prices but in the supply of mortgage money. That is why we are operating the joint scheme with the building societies through the joint advisory committee.