HC Deb 16 February 1979 vol 962 cc1542-54

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Thomas Cox.]

4.14 p.m.

Mr. William Shelton (Streatham)

I am grateful for the opportunity of having this Adjournment debate to raise a matter of some concern in the area of Lambeth in which lies my constituency. I shall refer particularly to the housing policy in Lambeth and its effect on rates, house prices, unemployment and homelessness. I shall then urge on the Government what action I think might be taken to improve the situation at least in the medium term, though nothing can be done this year.

I shall describe, very briefly, the current situation that pertains in the borough. During the council elections in May of last year I put a question to the Prime Minister. I asked him whether he was aware of the Left-wing extremists standing as members of the official Labour Party in the borough of Lambeth. I told him that the then Labour leader of Lambeth had described the situation, if the result was satisfactory for that group of Left-wing extremists, as a Marxist dictatorship. I do not know whether or not there is a Marxist dictatorship in the borough, but what I do know is that we have a rogue council in that borough.

In an article in the Evening Standard, a statement was made that the People's Republic of Lambeth have effectively declared UDI. As a result of the borough elections last year, we have had a victory for "entryism", by which I mean Left-wing extremists who adopt the guise of Labour Party candidates and win power through the Labour Party.

Indeed, the leader of Lambeth council, Ted Knight, was, I understand, expelled from the Labour Party for about 10 years and was a full-time working member of the Socialist Labour League, which is now known as the Workers' Revolutionary Party. On London Weekend Television recently he was asked if his views have changed since those days and he said, I understand: My views have not changed. The Labour Party's views have changed. It was a victory, last year, for damaging Left-wing dogma and for the profligate spending of ratepayers' money and a defeat for prudence and good sense for those who live in the borough of Lambeth. It is a salutary warning of what might happen to Britain if Left-wing extremists in the Labour group were as successful in Westminster as they have been, unhappily, in Lambeth.

It is to the housing policies of the present Lambeth council that I wish to refer, and especially its policy of municipalisation. I should also like to point out where the Government could intervene in the future. My understanding is that Lambeth plan to spend about £60 million on housing acquisition over the next five years. The great majority of that housing will need renovation and it could perhaps be estimated that another £20 million will go on this cause over the next five years, bringing the total to £80 million.

This money will, of course, come from the Government, but part of the interest and the debt charges will fall on the people of Lambeth. At 10 per cent., we are then talking about the sum of some £8 million per year.

This extraordinary plan to nationalise houses in Lambeth has already had certain results. House prices have been rising in the borough in an extraordinary way. A local estate agent was quoted in the local paper as having said: The council is putting in cash offers for almost every vacant property coming on to the market and squeezing out ordinary buyers. They seem to be backed by unlimited funds. It was brought to my attention that a block of flats bought by a property company last year for £120,000 was sold to Lambeth council four months later for £170,000. It showed little prudence in the Council's management when it gave a profit of £50,000 over four months in an area which obviously it must know well.

In addition, marauding bands of people are moving into Croydon, Wandsworth and other boroughs, buying up for Lambeth properties in those neighbouring boroughs. It is a new sort of imperialism, as we have seen in Cuba, whose troops were sent into Africa or South America to spread the revolution. I ask the Minister to tell us at what time and on what date, and by what legislation, boroughs were in fact given powers so to do, because it must be a given power. I have been unable to find by what power the borough council can buy up properties outside its own territory without the agreement of the borough in which it is buying it.

Incidentally, Lambeth has spent £60,000 on a promotional campaign advertising its wish to buy up properties. As a result—according to figures produced by the Halifax Building Society—from 1 July 1978 to 1 October 1978, average house prices in the whole of London rose by £1,698, from £20,899 to £22,597, whereas in the Streatham area the rise in the same period was £3,500, from £21,600 to £25,100. These are average prices of properties in respect of which a mortgage was applied for to the Halifax Building Society.

On course, this was a consequence of the profligate buying of private property by the council. The result in human terms is much more damaging. It makes it much more difficult for young married people to buy their first home when they are bidding against a council which uses ratepayers' money. The disturbing and distressing case of a Mr. and Mrs. Wilson was reported in the local newspapers. They decided to buy a maisonette, applied to Lambeth council for a mortgage, and sent their fee. Two months later, the fee was returned without any explanation, and at that time without an apology. On inquiry they found that the council itself was buying the maisonette that they had agreed to buy.

The results in respect of unemployment are much more difficult to quantify but they are also very disturbing. As the Minister knows, Lambeth has an unemployment problem. I understand that there are 10 unemployed people for every job. That is not satisfactory. Half of those unemployed are under 30, and half are coloured. The difficulty is that there is a mismatch of skills in the borough. Most of the unemployed are unskilled, and there is an acute shortage of skilled workers.

Indeed, the Lambeth council housing investment programme stated that between 1971—when the Conservative council left office—and 1975 the borough lost 27 per cent. of its total of skilled workers. We know that it is the skilled workers who want to buy their own homes. It is the potential small employer who wishes to buy his own home. It is the wealth creators who wish to buy their own homes. All these people will find greater difficulty as the result of the environment that has been created by the policies of Lambeth council.

As The Economist said a few weeks ago: Tracts of London risk becoming homogenous Council fiefdoms. It is insanity providing more accommodation for the unskilled, where job opportunities are declining … Therefore, it is not only a rogue council; if The Economist is right, its policies verge on insanity.

The consequences of these policies also fall on costs and efficiency. The council officers with whom I have had dealings are extremely efficient, courteous, excellent men and women who do their job well. But because of their political masters, they are unable to assimilate the vast influx of new properties that are pouring in on them. Part of the consequence is that Lambeth council is gaining a reputation as an extraordinarily bad landlord.

In answer to a question on 13th December, it was stated that 2,650 empty homes in Lambeth were owned by Lam- beth council. That is 9 per cent. of the housing revenue account's stock. It is the equal highest percentage of empty homes owned by any of the 32 London boroughs.

It may be argued that Lambeth has more special problems than all the other London boroughs, but I draw the attention of the Minister to Wandsworth, which is next door. Wandsworth is very similar, demographically, with many of the same problems. It has only 4 per cent. —not 9 per cent.—of housing stock empty, and only 1,050 as compared with Lambeth's 2,650. This must be an indictment of the management of the Lambeth housing policy, because of the influx of homes it has coming in through its municipalisation programme. Yet the council admits that it has a waiting list of 13,000 families.

When people come to me desperate for a house and give me lists and lists of empty houses, houses that have been empty for one year or two years—I could take the Minister and show him a council flat that has been empty for four years —I find it extremely difficult to explain this to my constituents.

Again, as regards council rents unpaid, Lambeth has the second worst record of all the 32 London boroughs—9 per cent. The rent owing is over £1 million. Last year it rose to £1.7 million. It represents 9 per cent. of total rents payable. Wandsworth's figure was £700,000 two years ago. Wandsworth lies ninth as opposed to Lambeth's second place. I would add that Wandsworth is a Conservative-controlled council now.

As for repair expenditure, Lambeth's figure is the highest of all the boroughs. In supervision and management costs, it is the third highest of all the boroughs. Repairs are slow. I am afraid that the council is indeed a thoroughly bad landlord. As municipalisation advances, the situation can only get worse and worse. The geographical spread of the houses that the council is buying, for instance, in other boroughs, as I have mentioned, must bring extraordinarily difficult problems of housing management and repairs. The council's teams will have to travel much further than good housing management would call upon them to do. The lack of standardisation in property will raise increasing problems for them. Therefore, the council is piling problem upon problem by pursuing this policy.

As a result, we have the rates problem. We know that the right hon. Gentleman the Secretary of State for the Environment expressed the hope that rate increases would remain within single percentage figure this year. Lambeth has an intended rate rise of 37½ per cent. In that figure, I understand, there is only 5 per cent. reserve for a settlement with the public employees. If one adds another 10 per cent., one is probably talking about something like a 45 per cent. increase. I understand that Councillor Knight is quoted in the Evening Standard as saying that this is inevitable in inner London boroughs, which will face the same problems. I draw the Minister's attention to Wandsworth, next door, a Conservative-controlled council, where the rate increase is provisioned at between 3 per cent. and 4 per cent. If there is a high settlement with the public employees, it might rise to about 10 per cent. or 11 per cent.—about one-third of that of Lambeth.

I saw in the newspapers yesterday that the Inner London Education Authority is pegging its rates and that the GLC's rise is about 11 per cent. or 12 per cent. Indeed, Lambeth council has said that it needs 28 per cent. just to maintain its existing services. How it can possibly say that when the rate of inflation has been 7 per cent., 8 per cent., or 9 per cent., I do not know. Again, it must be profligate spending. The council has not helped the situation by freezing council rents, although the average council rents are the lowest of all those of any council in London, bar two. It is a cynical political move to create a fiefdom to vote Labour at the expense and cost of the mass of ratepayers.

Such rate increases as I have been talking about bankrupt or drive out businesses and shops, discourage new employment and seriously burden those in the community least able. We know that whilst there is provision for supplementary benefits and for rent and rate rebates, many people who desperately need them do not take advantage of them, through pride or through ignorance. Therefore, this burden must fall on these people. Indeed, a petition was launched a week or so ago. I do not know how many people have signed it now, but within three days it had gathered 6,000 signatures, and in the High Road people were queuing 20 to 30 deep in order to put their names to it. It will be presented on 21 March, which is the final day for the rate decision.

A meeting of ratepayers proposed for next week or the week after has had to be moved to one of the largest halls in the area because the audience will be so large.

The situation is all the more bitter because the Lambeth councillors have just voted themselves a pay rise. They are including party meetings as eligible for pay. The Tories on Lambeth council voted against this, as did a splinter group of Labour councillors. The Tory-controlled Wandsworth council next door rejected the proposal outright and has frozen pay. This is a warning to the country that if Left-wing extremists in the guise of Labour Party supporters gain in Westminster as they have in Lambeth the whole country could suffer as Lambeth is suffering.

Now what can be done? There will be council elections in 1982. There is a by-election on 8 March, when the voters will doubtless show their feelings. Public indignation may have an effect within a year, but I urge the Government to see whether they can take powers to treat block 1 of the housing investment programme differently. The housing investment programme consists of bids that local councils put in to central Government. It is divided into three blocks. The first is for new house building, slum clearance, improvements to local authority dwellings and municipalisation. Lambeth applied for £61 million and was awarded £47 million. Blocks 2 and 3 are for similar projects of smaller amounts. Lambeth had a shortfall of £13 million. I understand that it has said that, come what may, it will not reduce its municipalisation programme. I understand that it is taking money from block 2, extending tolerances and anticipating from next year. In reply to its application for the programme, the Department of the Environment wrote that If the amounts for block 1 and 2 are less than seems necessary, the council is asked not to alter its new building programme nor its conversion and rehabilitation programmes. Lambeth has not followed the advice given by the Department and has altered those programmes. If it is spending £14½ million on municipalisation in the first year, that must be so.

I urge the Government to take powers in future to determine block 1 applications in detail, percentage by percentage, and not as a total. If the Government are lending such great sums of money, they should have more control over the way in which the money is spent. Block 1 is far too indeterminate. The Government should see how this can be done in the future. There should be a percentage on each item in the block 1 application. I hope that the Government will take heed and the country be warned by what is happening in Lambeth.

4.33 p.m.

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

The hon. Member for Streatham (Mr. Shelton) used a number of epithets to describe the present leadership of the Lambeth borough council, including "Left-wing extremists". He used the word "revolution". He described its policy as nationalising housing, which is a misnomer. But I propose to make no comment on that.

I listened carefully to what the hon. Member said. He drew attention to some aspects of the housing policy of the Lambeth borough council, but he did not paint the whole picture. That is surprising, as he represents one of the constituencies there. He should know that the borough has some of the worst housing problems in London, if not in the country. My Department's estimates show a total of some 105,000 households living in 95,000 occupied dwellings. Of those households, at least 15,000 are sharing accommodation, often in overcrowded dwellings. Over 22,000 are either lacking or do not have exclusive use of one or more basic amenities such as hot water supply or inside toilet. Many, such as the elderly and families with young children, are living in accommodation which is quite unsuitable for their needs.

Despite large-scale redevelopment programmes, almost half of the housing stock in the borough is still more than 60 years old, with the accompanying problems of poor layout, lack of facilities and disrepair. Many of the older estates in the northern part of the borough are cramped and congested. There are serious prob- lems of homelessness and squatting. This formidable concentration of bad housing conditions is aggravated by other social and economic disadvantages such as low incomes, unemployment, especially amongst young people, inadequate social facilities, and a poor urban environment. I hope that I do not have to emphasise too strongly the severity of these inner city problems in Lambeth. They should be as well known to the hon. Member and members of his party as they are on this side of the House.

Considerable progress has already been made in dealing with these problems. Since the 1967 house condition survey established their full extent in the borough, the statutory housing authorities and other housing agencies have carried out major programmes of new development, and rehabilitation of estates and individual houses. In addition, the past four years have seen a major expansion in the area improvement programme and the promotion of improvements in the private sector.

Further positive action is required. Lambeth council has made a very strong case, both in direct discussions with the Department on the housing investment programme and through the inner city partnership, for a favourable allocation of resources to enable it to undertake such action. The council has drawn attention to the continuing problems of shortage of suitable rented accommodation, the substantial requirement for extensive improvement and renewal of the housing stock, the need to reduce densities and improve the environment, and the concentration of these and other facets of social and economic stress in the northern part of the borough.

The council has reiterated, in discussions with the Department, that if it is to improve housing conditions and make Lambeth an attractive place in which to live and work, it must tackle vigorously the problems of congestion and urban decay which are evident. It has drawn up a housing strategy which is intended at least to maintain the impetus of current programmes and to arrest any decline in housing standards in the borough. It is the council's belief that the essential part of this strategy must be directed towards the acquisition of houses for immediate occupation by residents moving out of areas of housing stress, and the improvement of housing and environmental conditions on its inner city estates.

My Department has discussed Lambeth's housing strategy with the council's representatives as part of discussions held with local authorities countrywide on their housing investment programmes. We have recognised the severity of the housing problems in the borough and the need for effective action to deal with them. This has been reflected in a capital spending allocation of £56.5 million in the coming year.

I hope that I make it clear that we are determined to support the efforts of the authtorities participating in the Lambeth inner city partnership to tackle the economic and social problems in the borough, in which appropriate housing policies must play a crucial role. However, the hon. Member has referred to some very specific aspects of the local situation.

Mr. John Tilley (Lambeth, Central)

Before my hon. Friend leaves the general issue of housing, may I ask whether he agrees that Lambeth council is carrying out precisely the housing aspect of the Government's inner city programme that has been supported by both Front Benches? Does he agree that, if the Government are to respond any further to the situation in Lambeth, in order to maintain the excellent housing policies and reduce the rate rise they should give more Government money rather than less, as the hon. Member for Streatham (Mr. Shelton) has suggested?

Mr. Barnett

I agree with my hon. Friend. The needs of this borough are such that one would dearly like to give it more than at present. But my hon. Friend will appreciate the difficulties involved.

There was one rather disturbing aspect in the speech of the hon. Member for Streatham. He asked me to interfere with the housing policies of a local authority. One of the policies that we have been anxious to pursue as a Government is not to interfere more than we need with the housing policies of local authorities, whether they happen to be Conservative or Labour-controlled.

The hon. Member will appreciate that it is not for me to justify the detailed policies or financial decisions of Lambeth council. That is a matter for the elected members of the council. The new system of housing investment programmes which this Government have introduced has been designed to give housing authorities considerable freedom to develop policies which they consider are appropriate to the local situation within the bounds of overall cash limits.

My Department is, of course, concerned to ensure that housing strategies are formulated which have regard to national policies, to the availability of national resources and to the most cost-effective use of those resources. But once allocations are settled housing authorities should be free to go ahead with the minimum of intervention by central Government. The housing investment programme system should thus increase local discretion by putting greater responsibility on the local authorities themselves for deciding on the right balance of policies.

Authorities have been asked to look at a range of policy alternatives in preparing their housing programmes and to review the social and financial aspects, including revenue implications, of those alternatives. They have also been asked to take industrial requirements into account in preparing housing policies, particularly in inner city areas where economic decline and the resulting loss of jobs has been a major cause of the problems found there. I have no reason to doubt that these matters have been fully considered by Lambeth council in coming to decisions on its housing strategy and expenditure programmes.

We recognise that if the particular problems of inner city areas such as Lambeth are to be tackled effectively, more resources must be channelled into them. The Government have stated their intention in the consultation document on housing policy that housing investment programmes and subsidy arrangements should ensure that inner areas with severe housing problems have a higher priority in the allocation of capital resources and that existing tenants and ratepayers do not have to bear a disproportionate share of the high costs of essential housing investment.

I have also referred to Lambeth's favourable housing expenditure allocation for the year, the greater part of which is directly supported by Exchequer grant aid. Lambeth is already receiving substantial assistance from central Government under the 1977 construction package and the expanded urban programme for projects contributing directly to the improvement of social and economic conditions in the borough.

Our intention in expanding the urban programme, with its 75 per cent. rate of grant, was to provide partnership and programme authorities such as Lambeth with specific and significant aid to relieve them of the cost of undertaking projects beneficial to the inner city areas. The Government are determined that the London partnership authorities have the resources, whether under the urban programme or housing investment programme, to enable them to launch a sustained attack on their problems.

We recognise, however, that there may be concern over the effects that additional expenditure may have on the rates, even though we consider that it is only right and proper for the authorities concerned, and therefore the local community, to continue to meet a proportion, albeit a relatively small one, of the costs of such initiatives. I shall be discussing this further with the London partnership boroughs. Although a final decision has yet to be taken by the council, the rate increases projected for next year are substantial. It is fair to say that Lambeth's rate increases in recent years have been modest, and its domestic rate poundage in the current year is well below the national average for England and Wales.

The borough has done very well out of the 1979–80 rate support grant settlement. Lambeth's needs element entitlement will increase by about £2.9 million in real terms, equivalent to a 5.2p rate. This is the second highest increase in England and Wales. This is in line with the Government's policy that the rate support grant distribution formula should be used to shift the distribution of the settlement in favour of those areas, mainly in the major conurbations, which have the most pressing economic and social problems.

I should also make the point that we have made substantial resources available for mortgage lending in Lambeth under the housing investment programme and building society support scheme. Owneroccupation—contrary to what the hon. Member suggested—has been steadily increasing in the borough and there seems no reason to believe why this trend should not continue. But, of course, the answers to Lambeth's housing problems do not only lie within the borough itself.

The Question having been proposed after Four o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjorned at sixteen minutes to Five o'clock.