Commons Sitting of 5 March 1979

Preamble
The House met at half-past Two o'clock

Preamble
PRAYERS
[Mr. SPEAKER in the Chair]

DEATH OF A MEMBER
Mr. Speaker: I regret to have to inform the House of the death of Thomas Henry Swain, esquire, Member for Derbyshire, North-East, and I desire on behalf of the House to express our sense of the loss we have sustained and our sympathy with the relatives of the hon. Member.
ORAL ANSWERS TO QUESTIONS
  PRICES AND CONSUMER PROTECTION

    Director General of Fair Trading
    Mr. Maddenasked the Secretary of State for Prices and Consumer Protection when he intends next to meet the Director General of Fair Trading.
    Mr. Durantasked the Secretary of State for Prices and Consumer Protection when he plans next to meet the Director of Fair Trading.
    The Minister of State, Department of Prices and Consumer Protection (Mr. John Fraser)Tomorrow.
    Mr. Madden: Will the Minister ask the Director General what progress is being made in his discussions with the building societies on the introduction of a joint valuation and structural survey scheme for potential house purchasers? Is the Minister aware that the scheme is now in its seventh draft and that the discussions have been rumbling on for about 18 months? When does he expect the scheme to be introduced?
    Mr. Fraser: I understand that the Office of Fair Trading and the building societies are likely to reach agreement in principle very shortly. I shall then make an announcement.
    Mr. Durant: When the Minister meets the Director General tomorrow will he ask him whether it his intention to intervene in the case of Leisure Arts to deal with the anomalies and so-called malpractices?
    Mr. Fraser: If the Director General wishes to take action, he has adequate powers under part III of the Fair Trading Act. However, I am not aware of any breaches of the law which have come to his attention.
    Mr. Greville Janner: When the Minister meets the Director General will he congratulate him on the work that he and his Department are doing and ask what further plans he has for extending the protection of the consumer against exploitation?
    Mr. Fraser: That is a wide matter, but I shall certainly put the question to the Director General.

    Price Commission
    Mr. Neubertasked the Secretary of State for Prices and Consumer Protection when he intends next to meet the chairman of the Price Commission.
    Mr. Canavanasked the Secretary of State for Prices and Consumer Protection when he expects to meet the chairman of the Price Commission.
    The Secretary of State for Prices and Consumer Protection (Mr. Roy Hattersley): The chairman of the Price Commission and I meet frequently. No firm date has been set for our next meeting.
    Mr. Neubert: Although several factors contributed to the decision, does not the Price Commission's 12-month freeze on British Oxygen prices cast some doubt on denials that the Commission is acting as a sanction in support of the Government's pay policy? In this connection, was not the Secretary of State's speech to Lancaster Labour Party a fortnight earlier highly significant? In that speech he linked the importance of private sector pay settlements to inflation in the next

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    few months with the increased powers recently given to the Price Commission.
    Mr. Hattersley: The hon. Gentleman continues in vain his efforts to demonstrate that I direct the work of the Price Commission. I do not, nor am I able to under the law. What the report into British Oxygen demonstrates is that all costs contribute to prices, including wage costs. If that comes as news to the hon. Gentleman, it does not to anybody else.
    Mr. Canavan: Will my right hon. Friend tell the Chairman of the Price Commission that it is about time he started using his powers to freeze prices instead of standing by and watching profiteers exploiting ordinary working people? For example, why were Scottish & Newcastle Breweries Ltd. allowed a recent increase of 3p on a pint of beer when that company's pre-taxed profits for last year alone amounted to £35 million?
    Mr. Hattersley: I suspected that that was the supplementary question which my hon. Friend would ask. The powers of the Price Commission enable it to make discretionary investigations of price applications and to make judgments about where an investigation is justifiable and whether a price increase could be justified, against the criteria that have been set down by the Act. It is not for me to interpret how the Price Commission acts in relation to individual companies. We must assume that in the case to which my hon. Friend referred the Commission decided that an investigation or freeze was not within the terms of the Act. In the case of two other breweries, where the action sought by my hon. Friend was taken, we must assume that the Commission judged that that was within the terms of the Act.
    Mr. Tim Smith: Is the Secretary of State aware that in almost every Price Commission report to date the Commission has commented on the management efficiency of the company under investigation? Will he ask the chairman of the Commission to define management efficiency? If the Commission does not do so, does the Minister believe that it is qualified to comment upon it?
    Mr. Hattersley: I do not believe that to be a task which I can impose rightly on the chairman of the Price Commission.
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    I believe that in a number of reports, known both to myself and to the hon. Gentleman, it has been demonstrated that with greater management efficiency the consumer can be spared an unnecessary price increase. It is the duty of the Price Commission to ensure that when a price increase is unnecesary it is not implied. I hope that the Price Commission will continue to carry out that duty.
    Mr. Skinner: Will my right hon. Friend accept that if the Government are goaded by the Opposition into switching from direct taxation to indirect taxation, in the next Budget or any other, that will increase prices? Will he resist any moves in that direction in every capacity in which he serves?
    Mr. Hattersley: The Budget judgment and intentions are not matters for me. The Chancellor of the Exchequer is as well aware as is my hon. Friend that any increase in indirect taxes increases the cost of living and the cost of people's normal purchases. On the other hand, my right hon. Friend's principal obligation on inflation is to run the sort of economy that holds prices down and beats inflation in the long run. He has to balance the alternative obligations, all of which lead to the same end.
    Mr. Giles Shaw: The Secretary of State referred earlier to management efficiency. As he is meeting the chairman of the Price Commission tomorrow, will he discuss the amount of management time that is wasted inefficiently in dealing with Commission inquiries? Why does the Commission send out detailed questionnaires and follow them up with detailed questionnaires from the consultants it employs? Why cannot the Commission be more efficient?
    Mr. Hattersley: The hon. Gentleman ought to give some hard examples rather than make general allegations. A number of companies that have been investigated by the Commission have published their appreciation of the way that the Commission works and endorsed its judgment. If the hon. Gentleman wants to give examples of unnecessary questions and time being wasted, he should state them specifically, instead of making general allegations.
    Mr. Giles Shaw: I will.

    Price Increases
    Mr. Dykesasked the Secretary of State for Prices and Consumer Protection what was the percentage movement in the retail price index in the last two quarters of 1978.
    Mr. Hattersley: Compared with the previous quarter, the retail price index rose by 1·7 per cent. in both the third and fourth quarters of 1978.
    Mr. Dykes: In view of those figures and the likely figures for January and the first quarter of this year, why are the Government so confidently promising the public that inflation will not go into double figures again this year? What factors have the Government taken into account in making that rather rash promise?
    Mr. Hattersley: When the hon. Gentleman reads the figures in Hansard he will find that they are not as bad as his prepared supplementary question anticipated. The Government's reasons for what we have said about double-figure inflation are clear. It still remains within the power of the people and the Government to keep inflation at or about its present level. The decision about that is one for the Government and the people in partnership. We hope that the people, particularly through the wage claims that they will be pursuing in the next month or two, will demonstrate their determination to keep inflation within manageable proportions.
    Mr. Gwilym Roberts: Does my right hon. Friend agree that the fundamental factor in this matter is the strength of the economy and the fact that the pound is therefore remaining strong? Does he agree that this will be reflected in costs and, therefore, wholesale prices in coming months, and that it is a common belief among most forecasters that inflation will not only remain in single figures for the rest of this year but will be considerably lower than some of the previous forecasts?
    Mr. Hattersley: The facts to which my hon. Friend has referred are important. The pound remains strong and is stronger than it has been for the past two years. That will clearly have a beneficial effect on import prices and, therefore, on the rate of increase of inflation in general.
    Mrs. Sally Oppenheim: As the rate of inflation has now established a clear upward trend, with a return to double-figure inflation being widely forecast, will the Secretary of State admit that the Government's counter-inflation policy is in ruins and that a further upsurge in inflation is likely as a result of the increase, among other things, in local authority rates, particularly the increases being proposed by Labour local authorities?
    Mr. Hattersley: I agree with hardly anything that the hon. Lady said. Her forecasts of the changes in the rate of inflation have been uniquely bad over the past two years.
    Mrs. Sally Oppenheim: They have not.
    Mr. Hattersley: I apologise. The hon. Lady is right. Her forecasts have not been uniquely bad. The Leader of the Opposition said on Saturday that the Government's vaunted single-figure inflation rate was a nine month wonder—when it had already been in single figures for 13 months. Someone is even worse than the hon. Member for Gloucester (Mrs Oppenheim) in these matters.
    The position is clear. It is possible for this country to maintain a rate of inflation at or about the present level as long as the country co-operates in bringing about the sort of policies that achieve that end. If the hon. Lady and her colleagues continue to predict massive increases in prices they will be creating the circumstances that they pretend to fear.

    Inflation (International Comparisons)
    Mr. Gwilym Robertsasked the Secretary of State for Prices and Consumer Protection what change has taken place in the rate of inflation between January 1976 and January 1979; how this compares with January 1971 to January 1974: and if he will give comparable figures for the Federal Republic of Germany and the United States of America.
    The Under-Secretary of State for Prices and Consumer Protection (Mr. Robert Maclennan): Between January 1976 and 1979, the annual rate of inflation in the United Kingdom fell from 23·4 per cent. to 9·3 per cent. Between January 1971 and January 1974 the rate rose under the previous Administration from 8·5 per cent to 12 per cent. The annual percentage inflation rates in January 1971, January

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    1974 January 1976 and December 1978 for West Germany were 4·2, 7·4, 5·3, 2·4 and for the United States of America were 5·2, 9·4, 6·8, and 9, respectively.
    Mr. Roberts: Does my hon. Friend agree that those long-term figures demonstrate the poor record of the Conservative Party on inflation and the considerable achievements of the present Government, with the co-operation of the trade union movement and working people generally?
    Mr. Maclennan: I agree with my hon. Friend that the inflation that the Opposition induced during their period of office was largely their own responsibility, and particularly the responsibility of the then Chancellor of the Exchequer, Lord Barber.
    Mr. Adley: Can the Minister remind me and the House about the strange, missing two years? Which Government were in office between February 1974 and January 1976? Did the Minister support them?
    Mr. Maclennan: The hon. Gentleman seems to have no memory at all.

    European Community (Food Prices)
    Mr. Martenasked the Secretary of State for Prices and Consumer Protection whether he has made any representations to the EEC concerning the level of prices.
    Mr. Maclennan: I frequently attend meetings of the Agriculture Council. The Government have consistently made clear their strongly held view that the common price level in the EEC is too high.
    Mr. Marten: What has the Common Market actually done to help bring down prices in this country?
    Mr. Maclennan: It is reckoned that food prices are about 10 per cent. higher than they would be if we were not members of the EEC, but my right hon. Friend the Minister of Agriculture, Fisheries and Food is negotiating to try to eliminate the surpluses and excessive common price increases. It is hoped that that will help to stabilise the trend which is wholly unacceptable to the Government. As a footnote to that answer, there is an EEC subsidy on butter which is worth 5p per pound.
    Mr. Heffer: Does my hon. Friend agree that, apart from the inflationary policies carried out by the Opposition when they were in office, one of the reasons for the dramatic increase in prices was that we entered the Common Market? Does he agree that it is only now that some of those prices are beginning to level out, at a much higher level than they should have been in the first place?
    Mr. Maclennan: Food prices have increased as a result of our joining the EEC. That was brought about in part by our having to move through five stages of increases to price levels that were more approximate to those of the Community. That was understood and predicted to be inevitable when we took the decision and the country voted in the referendum to remain in the Community.
    Mrs. Kellett-Bowman: Is the Minister aware that when the cost of living rose in 1978 by 8·4 per cent., only 0·4 per cent. of that was due to the 7·5 per cent. devaluation of the green pound, whereas twice as much—0·8 per cent.—was due to an increase in car prices? Does he not believe that we must have an increase in British agricultural output if we are to maintain a steady supply of food to consumers and to sustain our balance of payments in the coming years?
    Mr. Maclennan: It is certainly the Government's policy, as described in the recent White Paper, to see increased agricultural production where it can be achieved efficiently and competitively. For that purpose, it is necessary that from time to time farmers' support prices be increased. That is a recognised part of the Government's policy.

    Price Commission (Disallowed Price Increases)
    Mr. Sainsburyasked the Secretary of State for Prices and Consumer Protection whether he will direct the Price Commission to include in its next report an analysis of the factors used in its decisions on disallowing price increases, including whether or not productivity schemes have been found not to be self-financing.
    Mr. Hattersley: No, Sir. The Price Commission Act 1977 gives me no powers to direct the Commission as to the matters to be included in its quarterly reports.
    Mr. Salisbury: Does the Secretary of State agree that if, as seems to be indicated by the recent report on the British Oxygen Company, the question whether a productivity deal is self-financing will become a critical factor in a Price Commission decision, two points follow? The first is that it would be illogical to make that decision binding for 12 months, because clearly within that period productivity could change dramatically. The second is that if the private sector is to suffer from this it will need to be very much reassured that the public sector monopolies' so-called productivity deals are equally rigorously scrutinised.
    Mr. Hattersley: I regard it as a matter not of suffering but of simple common sense. If a company accepts a further financial obligation and increases its costs in a way that at one time it suggests will not result in increased prices, but it then admits has resulted in increased prices, it should have no automatic right to pass on those increased prices to its customers. That seems to me to be elementarily true and elementarily right.
    With regard to the hon. Gentleman's second point, he must understand that the Price Commission makes its own judgments about self-financing productivity deals or, for that matter, any other element in a company's or industry's costs. When it inquires into the public sector, as it does from time to time, it can make exactly the same recommendation as it did in the case of the British Oxygen Company.
    Thirdly, as to altering the imposition of a price freeze if a company were to increase its efficiency, if the productivity deal were suddenly to bear the fruits that were promised, I made it clear in the press notice accompanying the report on the BOC that the Government would respond in exactly that way.
    Mr. Durant: Will the Secretary of State bear in mind what my hon. Friend the Member for Pudsey (Mr. Shaw) said about firms that feel that they waste a great deal of time dealing with the Price Commission? Will he do so particularly in the case of Metal Box, which merely passed on the increased price of tinplate from the British Steel Corporation? There was no additional increase, but a great deal of time was spent looking at
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    that increase in price, which was obviously allowed because the Government had agreed to the price increase by the BSC.
    Mr. Hattersley: The case of Metal Box demonstrates a number of morals that we should draw from Price Commission investigations. Not the least is that one of the reasons why that investigation came about was that pressure was brought to bear by the Food Manufacturers' Federation which said that it wanted an inquiry into tinplate prices and the prices of the containers in which its members sold their wares. One moral to be drawn is that the Commission should be allowed to make its own judgments, rather than have investigations imposed on it by vested interests of one sort or another.
    Mr. Giles Shaw: Does the right hon. Gentleman agree that there is also a moral to be drawn on the subject of disallowed prices? Would he care to comment on the position with regard to paraffin, where a controlled price agreed between his Department and the Secretary of State for Energy has resulted in the wholesale price going up but the retail price being fixed? As a consequence there is now a grave shortage of paraffin in certain parts of the country because distributors no longer find it profitable to sell or stock it. Is not this, too, something that the Secretary of State should investigate?
    Mr. Hattersley: In principle, I am not attracted by the idea of controlled and fixed prices. I much prefer to allow a freer system of price determination to come about, and when it is not free, because the price is determined by monopolies rather than competition, I am in favour of the Price Commission's examining the circumstances in that particular case. Therefore, the hon. Gentleman's general point receives some sympathy from me, but I do not think that the conclusion that he draws about the specific example is correct.

    Inflation
    Mr. Michael Morrisasked the Secretary of State for Prices and Consumer Protection what are his forecasts for price inflation, as measured by the retail price index, in the coming year.
    Mr. Montgomeryasked the Secretary of State for Prices and Consumer Protection what estimate he has made of the likely trends in the retail price index up to the end of 1979.
    Mr. Shersbyasked the Secretary of State for Prices and Consumer Protection what is his current forecast of the date on which the 12-month rate of increase in retail prices will rise above 10 per cent.
    Mr. Hattersley: The Government's short-term economic forecast was published on 15 November 1978. Such forecasts are of course conditional upon a number of financial and economic factors—not least the growth of earnings.
    Mr. Morris: I am grateful for that answer, but is the right hon. Gentleman aware that I ask that question now because there have been a number of changes in the economy since that forecast was made? It is most disappointing not to be able to receive a specific answer. May I ask the right hon. Gentleman now to give me a specific figure of the latest forecast increase in relation to this question?
    Mr. Hattersley: As the hon. Gentleman must know, it is not possible to give a precise estimate of the sort that he wants, although, as part of the Budget, the obligations placed upon my right hon. Friend the Chancellor of the Exchequer to publish a forecast will mean that a more up-to-date figure is provided. All that I can tell the hon. Gentleman—and I hope that he and the country will believe this—is that it remains possible that we can keep inflation at or about its present level. But that requires the wholehearted cooperation of industry as a whole, the British trade union movement and all those who contribute to the causes of increased inflation or stable inflation.
    Mr. Montgomery: How does the Secretary of State explain the fact that in Abertillery on 28 November 1978 he said that it was possible to forecast five to six months ahead because of factors that were known to his Department? Is not his newfound modesty largely due to the fact that he knows all too well that inflation will be back in double figures before very long?
    Mr. Hattersley: The hon. Gentleman was one of those who at the time of the Abertillery forecast announced that I could not make predictions with such accuracy. In fact, what I said then turned out to be exactly right. We achieved single figures in the early months of last year and we remained at or about that figure for the following year. What was different then from now is very clear. The overall level of earnings is not easy to predict and is not easy to determine. If it remains at the reasonable level advocated by the Government we can have another good year of inflation outturn. If not, inflation may well accelerate again. What I am reminding the House of today is the importance of holding down those costs that might accelerate the retail price index. I hope that Opposition Members will support us in making that point.
    Mr. Litterick: Can my right hon. Friend tell the House the extent to which the no doubt approximate estimate of future price increases is attributable, first, to wage increases; secondly, to factors external to the British economy; and, thirdly and very important, to those factors that are directly under the Government's control?
    Mr. Hattersley: Of course, there are some external factors. My hon. Friend would not expect me to pretend otherwise. The potential increased cost of imported oil is an obvious example. But I must tell my hon. Friend this about the other two categories. Those factors that can be determined by the Government—the control of the money supply and the limit on the expansion of the public sector borrowing requirement—have been moving in the right direction for the past two years. In all those particulars the Government have acted in a way consistent with our inflation targets. That leaves wage costs, which are a substantial contribution to every price increase. For the rest of the year they will determine our inflation by the end of 1979 and the early months of 1980.
    Mr. Rost: The Secretary of State is very good at blaming the Government's appalling record of rising prices on everybody else and everything else, particularly wage costs. Will he now tell us what proportion of the increased inflation that is expected is due to the Government's inability to control their own spending to

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    keep it within what they are prepared to raise in taxation?
    Mr. Hattersley: I said a moment ago, and I repeat, that the Government have a better record over the public sector borrowing requirement, domestic credit expansion and the money supply than our predecessors. If the hon. Gentleman has any doubts about that, I suggest that he reads "An End To Promises" written by one of his hon. Friends, who described the problems faced by the previous Government in the dying days of that Administration in terms that I have used to describe them at previous Question Times.
    Mrs. Sally Oppenheim: How can the Secretary of State reconcile the fact that the trend in inflation has been rising steadily for the past three months, at least since last November, with his own optimistic statements in June and November last year to the effect that 1979 would be another successful year in terms of containing inflation? As he appears to be having some difficulty in making long-term forecasts, may I offer him the services of Conservative research department statisticians to explain to him why my forecasts of last year are proving right and his are proving wrong?
    Mr. Hattersley: I take it that those are the same statisticians as urged the Leader of the Opposition to talk about nine months in single figures four months too late. But, putting that aside, knowing the hon. Lady to be an assiduous student of all my speeches, I always look, on the morning of my Question Time, to see what predictions I have made in the recent past. The predictions I made during the months to which she referred are boringly identical with what I have said today, namely, that inflation during the early part of 1979 was a matter for the British nation as a whole to decide that high wages would produce high inflation rates and vice versa. That is what I said then, and that is what I repeat now.
    Mrs. Oppenheim: On a point of order, Mr. Speaker. I should like to provide you with examples of quotations from speeches by the Secretary of State—
    Mr. Speaker: Order. I read speeches by right hon. and hon. Members on both sides of the House and keep my opinions to myself.

    £ Sterling
    Mr. David Huntasked the Secretary of State for Prices and Consumer Protection if he will estimate by how much the devaluation of the £ sterling, since October 1974, has affected food prices.
    Mr. Maclennan: It is not possible to distinguish the effects of the changes in the exchange rate from the many other factors affecting food prices over the period from October 1974.
    Mr. Hunt: Will the Minister accept that, even if he were able to calculate a figure, the position would be much worse were it not for the achievements of the private enterprise oil industry in the North Sea? Will he accept, further, that the present position is directly as a result of Government mismanagement which has made life in this country very much more difficult, especially for those on fixed incomes?
    Mr. Maclennan: The hon. Member will be aware that so far from the pound sterling having been devalued during the past year it has appreciated against a trade-weighted basket of currencies by 1·4 per cent., which is one of the contributory factors towards the stabilisation of the inflation rate.
    Mr. Gwilym Roberts: Will my hon. Friend congratulate the Minister of Agriculture, Fisheries and Food on his determined battle against devaluation of the green pound, and will he ask him to continue this battle, since it is in the interests of housewives in general?
    Mr. Maclennan: It is the Government's policy to recognise from time to time that changes in the green rate are inevitable in the wider interest of the economy as a whole. But my hon. Friend is right to point to the determination of my right hon. Friend the Minister of Agriculture, Fisheries and Food to ensure that the interests of consumers and counter-inflation policy are borne very much in mind in the balance against other pressures for change.
    Mr. Dykes: In view of the earlier references to the common agricultural policy, does the Minister agree that, notwithstanding the partial recovery of the pound against other European currencies, the

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    green pound differential through the MCAs in effect provides a substantial subsidy to our farm prices, representing one quarter of our contribution to the Community budget?
    Mr. Maclennan: I recognise that if we were to abandon altogether the present green pound level it would mean a substantial increase in the price of food. I do not know whether that is what the hon. Gentleman is recommending. It would mean an increase in the food index of about 6 per cent.

    Drugs
    Mr. Pavittasked the Secretary of State for Prices and Consumer Protection if he will take steps to monitor the increase of the price of drugs and restrict profit margins, in the light of the 62 per cent. margin on the price to the retailer of PRO-HYD 50 capsules 30.
    Mr. MaclennanIt is for the Price Commission to decide whether to investigate a particular price increase or the margin of a particular distributor.
    Mr. Pavitt: Will my hon. Friend see the Price Commission about these inordinate increases? The example which I give in my original question is only one of dozens of similar price rises in pharmaceutical products. Even worse, is my hon. Friend aware that the taxpayer is paying 100 per cent. more for commonly used drugs in the National Health Service than he was a year ago, and that this is a complete twist of the inflationary spiral about which his Department should be doing something?
    Mr. Maclennan: My hon. Friend will know that the prices of certain drugs are controlled by the Pharmaceutical Price Regulation Scheme and not by the Price Commission. To that extent, therefore, my hon. Friend's question should be directed to my right hon. Friend the Secretary of State for Social Services. To the extent that there are drugs which are not involved in that scheme, they are subject to the Price Commission's examination, and my right hon. Friend directed the Price Commission to examine the prices, costs and margins in the production and distribution of proprietory non-ethical medicines. My hon. Friend will have read that report, and he will
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    recognise that it does not bear out fully all his assertions.
    Mr. Michael Morris: Will the hon. Gentleman recognise that this question has nothing to do with the type of medicines that he referred to the Price Commission? The hon. Member for Brent, South (Mr. Pavitt) mentioned ethical products. However, before referring any matter to the Price Commission, will the Minister draw to its attention the recent report of the Office of Health Economics which said that the chief problem in the NHS was for primary care to be increased, and, concomitant with that, the greater use of drugs and research into drugs? If the drug companies are to succeed they have to be able to market their products properly.
    Mr. Maclennan: I do not think that removes from the Government the responsibility to scrutinise carefully, through the Pharmaceutical Price Regulation Scheme, the prices of drugs and, in the non-ethical sphere, the Price Commission's responsibility. But I must re-emphasise that it is not a matter on which my right hon. Friend can direct the Price Commission. The Commission is required to investigate at its own discretion where there is a suspicion that a price increase is not justified.

    Food Prices
    Mr. Peter Morrisonasked the Secretary of State for Prices and Consumer Protection what has been the increase in food prices since February 1974.
    Mr. Maclennan: In mid-January the food price index had increased by 115·6 per cent. since 1974.
    Mr. Morrison: Will the Minister say, in view of that very substantial increase in the cost of food over the past five years, what his estimates are for the increased cost of food over the next 12 months?
    Mr. Maclennan: All predictions of that kind are fraught with considerable difficulties. That is especially so in the case of food. The price of fresh food, as has been demonstrated by the events of January, is extremely subject to fluctuations due to weather. Seasonal foods vary very much in price from year to year. A very large part of the recent

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    increase has been due to the quite exceptional rise in the price of vegetables.
    Mr. Hardy: Although my hon. Friend is reluctant to offer any prediction, has he made any study of Conservative Party policy, such as it is? If so, does he agree that the implications of its policy are that food prices would rise enormously in a matter of months if Britain had the misfortune to have to endure one of its Administrations?
    Mr. Maclennan: The policy of the Conservative Party on food prices appears to be characterised by a completely unbalanced view that the green pound should be devalued as soon as possible, with all the disadvantages for the economy at large which would flow from that. The Opposition seem not to recognise the damage which would flow from any such sudden jump. The Government's policy is a balanced one bearing in mind both the needs of the producers and the pressures to which consumers are subject.
    Mr. Ridsdale: Does the Minister agree with the head of the Economic Commission that one of the chief reasons for the increase in the price of food has been the vast increase in transport costs?
    Mr. Maclennan: It is true that the cost of distribution is a major part of the end price paid by the consumer in the shop. A number of studies have been carried out by the Price Commission into the distribution of meat and fish especially. If the hon. Member has in mind a specific problem, perhaps he will draw it to the attention of my right hon. Friend.
    Mr. Grocott: Can my hon. Friend confirm that the view of the Conservative Party is identical with that of the National Farmers' Union on all food matters in that it calls for the complete devaluation of the green pound to bring our prices into line with those of other EEC countries? Will my hon. Friend also confirm that it is the Government's resolute determination to support completely the stance of my right hon. Friend the Minister of Agriculture, Fisheries and Food in this year's price round negotiations, whatever the effect it has on our relationships with the other eight nations?
    Mr. Maclennan: I have noticed that the farming press, which normally speaks with some favour of the Conservative Party, has not spoken with favour of its agricultural policy and indeed on more than one occasion has drawn attention to its absence. But I agree that my right hon. Friend is right to continue the policy which has been the policy of the Government over the past few years to seek balanced alterations in the green currency rate at the appropriate moments. I note what Mr. Richard Butler is reported to have said today. I do not know whether the Opposition are calling for a 15 per cent. devaluation of the green pound, as he has, but the cost consequences for the housewife will have been noted.
    Mr. Giles Shaw: Reverting to the supplementary question asked by the hon. Member for Rother Valley (Mr. Hardy), is the Minister aware that the Conservatives' price proposals on agricultural produce to move to common prices would result in a price increase of about 1 per cent. over five years? Bearing in mind what the Government have done with regard to VAT on food, which put up the food index by 4 per cent. at a stroke, who is the housewife's better friend?
    Mr. Maclennan: The hon. Gentleman is wholly wrong. The effect of eliminating MCAs in the way that he has described would be to put up food prices by about 6 per cent. at a stroke. That is something that no responsible Government could contemplate. Although the needs of the farming community are very much borne in mind by the Government, and have been demonstrated on a number of occasions, it is not possible to insulate the farming community wholly from our rate of inflation compared with that of the Community at large. We cannot hope to achieve common price levels until we have eliminated these disparities in our inflation levels. It is high time that the Conservative Opposition recognised that.
    Mr. Nicholas Wintertonasked the Secretary of State for Prices and Consumer Protection what is the increase in the retail price index, exclusive of seasonal foods, over the last six months, expressed at an annual rate.
    Mr. Cormackasked the Secretary of State for Prices and Consumer Protection what is the average annual rate of increase in the retail price index since February 1974.
    Mr. Tim Smithasked the Secretary of State for Prices and Consumer Protection how much the retail price index has risen since February 1974.
    Mr. Aitkenasked the Secretary of State for Prices and Consumer Protection what is the increase in the retail price index, excluding seasonal foods, over the last six months.
    Mr. Temple-Morrisasked the Secretary of State for Prices and Consumer Protection what is the latest year-on-year figure for the percentage increase in the retail price index.
    Mr. Newtonasked the Secretary of State for Prices and Consumer Protection what has been the percentage increase in the retail price index over the past 12 months.
    Mr. Hattersley: The retail price index has risen at an average annual rate of 15·6 per cent. since February 1974, giving a cumulative increase of 103·7 per cent. The increase over the last 12 months has been 9·3 per cent. The index, excluding seasonal foods, has risen by 4·3 per cent. over the last six months, which is equivalent to an annual rate of 8·8 per cent.
    Several Hon. Members
    Mr. Speaker: Order. I propose to call first those six hon. Members whose questions are being answered.
    Mr. Winterton: I am grateful to the Secretary of State for that information. Since the Government consider this index the most reliable index with regard to inflation, will he now concede that the Government's claim to be able to maintain single figure inflation throughout this election year is now, unfortunately, entirely bogus? Does he not accept that one way to keep down inflation is to encourage industry? Does he not agree that through various measures which the Government have introduced they have produced disincentives for industry which could make such a contribution to main-
    894
    taining a low figure of inflation in this country?
    Mr. Hattersley: No. I believe that it is still possible to maintain the inflation rate, as measured by the RPI, at or about its present level. I share the hon. Gentleman's view that the RPI is the best measure of inflation, which is why I did not draw attention to the final sentence of my answer, which shows that what is popularly called "the underlying rate is falling. I have stuck to the RPI in good times and bad. I have not chosen my index to demonstrate the best figure. I still believe in the RPI, and I believe also that it is possible, so long as the nation as a whole behaves sensibly, to keep inflation at or about its present figure.
    Mr. Cormack: Will the Secretary of State tell us how this 103 per cent. compares with the predictions that he and the Chancellor of the Exchequer made during the general elections of 1974? Can he also tell the House which British Government in history have had a worse record than this one on this front?
    Mr. Hattersley: The elections of 1974 were characterised by an argument concerning how inflation had been created. I share the view—I repeat it—that that was in part expressed by the hon. Gentleman who wrote "The End to Promises" that many of the causes of inflation in 1974–75 were established well before this Government came to power. The important achievement is that over the last two years we have cut the inflation rate by more than half. I believe that we can keep it at or about its present level, and we must struggle to do so.
    Mr. Smith: Is not the increase in me retail price increase since February 1974—to use the Secretary of State's own words—uniquely bad? How much worse is it than the increase under any previous British Government this century?
    Mr. Hattersley: This is the only British Government this century who came to power facing an increase of 400 per cent. in oil prices, a money supply that was wholly out of control, a public sector borrowing requirement that was expanding and industry that was rent by the divisions caused by the previous Government's industrial policy. For two years we overcame those difficulties, and since then we have managed to reduce the rate

    895
    of inflation. That is a fact with regard to the last five years.
    Mr. Temple-Morris: Modest man that he is, does the Secretary of State agree that since his Government came into office the pound has halved in value, or, to put it another way, that the cost of living has doubled? Modest man that he is, will he admit to any responsibility at all lying with this Government, and, if so, what responsibility?
    Mr. Hattersley: I have repeated this many times, and I shall repeat it again if it pleases the hon. Gentleman. I suppose that in 1974–75 we could have moved more quickly to remedy the errors of our predecessors. We could have attempted more quickly to get the money supply and the public sector borrowing requirement under control. Perhaps we did not clean up the mess sufficiently quickly, but that is the full extent of our responsibility.
    Mr. Madden: Can my right hon. Friend say what effect increasing television licences has had on the index? Does he favour abolishing the licence and raising the necessary revenue for the BBC from the Exchequer?
    Mr. Hattersley: I cannot give my hon. Friend the precise figure for which he asks, although it would be in points of decimals. As he knows, the second part of his question is a matter not for me but for my right hon. Friend the Home Secretary.
    Mr. Neubert: Would it not be more precise for the Secretary of State to admit that the time for alibis is over and that our record in the last five years, in comparison with other countries, is abysmal, and that even in January our inflation rate was higher than in any other country in the Common Market? Are not higher prices the inevitable consequence of a Socialist Government?
    Mr. Hattersley: The hon. Gentleman struggles to make his little political point. I must repeat the facts of the matter to him. We reduced inflation from over 20 per cent. to little more than 8 per cent.
    Sir John Langford-Holt: To 8·4 per cent.
    Mr. Hattersley: Exactly, 8·4 per cent. to be precise, if the hon. Gentleman wants
    896
    to remind us of that figure. We can maintain inflation at the present level, but one thing that would stop our maintaining it at that level would be the inducing of fear in the British people in general and the trade union movement in particular that since inflation is bound to get out of hand they must make pre-emptive wage demands to compensate for the anticipated rises. So long as the Conservative Opposition continue to pretend that inflation will again take off, I believe that they are making it more likely. We propose to tell the truth about inflation, which is that there is a good prospect of its remaining at or about its present level.

    Minimum Lending Rate
    Mr. Gowasked the Secretary of State for Prices and Consumer Protection what recent representations he has received about the increase in minimum lending rate to 14 per cent.; and what effect he expects that increase to have on the index of retail prices.
    Mr. Hattersley: None, in both cases.
    Mr. Gow: Does not the Secretary of State agree that the very high level of the Government's borrowing is the principal factor in the very high interest rates? Does he not understand that very high interest rates are wholly hostile to any growth in the economy?
    Mr. Hattersley: No, the very high interest rates, which I regret as much as the hon. Gentleman, are the result of a combination of factors, some of which are international and some of which are domestic. Having put down his question the moment that MLR went up, I would have hoped that the hon. Gentleman would record his pleasure that it has now gone down again.
    Mr. Litterick: Has my right hon. Friend considered referring to the Price Commission the rate of interest offered on the recent issue of Government securities?
    Mr. Hartersley: No.
    Mr. Nicholas Winterton: Does the Secretary of State accept that high interest rates have a bearing on prices charged by smaller business, the retailer in particular? Therefore, does not he accept that part of the price increases which housewives are experiencing today are a result of the Government's very high

    897
    public service borrowing requirement, which in the past has driven up interest rates and MLR? However, I welcome the recent small reduction in MLR.
    Mr. Hattersley: Of course increases in lending rates and the cost of borrowing are contributory factors when price increases come about. But the point that I tried to make a moment ago is that we must try to keep a balance over the economy as a whole. We have kept the public sector borrowing requirement firmly in check, we have stuck to our targets with regard to PSBR and our interest rate policy is a contributory factor in those targets being maintained.
    Mr. Michael Latham: With regard to local authority borrowing, will the right hon. Gentleman blame the shattering increase in rates which will come next month in many areas of the country—which will be far in excess of the Government's targets—on Lord Barber or on the EEC common agricultural policy?
    Mr. Hattersley: Different authorities have different records with regard to rate increases, and different authorties have different—
    Mrs. Oppenheim: Labour authorities.
    Mr. Hattersley: The hon. Lady cries "Labour authorities". That enables me to make my second point, which is that different authorities also have different records on the provision of services. The cry of "Labour authorities" is appropriate to them as well. As to specific rate increases, the hon. Gentleman must ask the Secretary of State for the Environment, and not me.

  PUBLIC EXPENDITURE
  Mr. Canavanasked the Chancellor of the Duchy of Lancaster whether, in his role as economic adviser to the Government, he is satisfied with current levels of public expenditure.
  The Chancellor of the Duchy of Lancaster (Mr. Harold Lever): All Government decisions, on expenditure as on other matters, have my full support.
  Mr. Canavan: Will my right hon. Friend give the House an assurance that the Government will resist the pressures which are coming from Tory hatchet men
  898
  and Treasury officials, who are demanding further savage cuts in essential social services in the forthcoming Budget? Does my right hon. Friend agree that an alternative strategy of increasing public expenditure by about £3 billion a year would not only help to improve essential social services but would create jobs?
  Mr. Lever: I do not know that there are any hatchet men among the Civil Service, in spite of the one-sided leaks that one reads about. The Government's approach to public expenditure is based on a rather broader vision than that of the Conservative Party. I am afraid that I cannot go along with my hon. Friend in believing that it would be appropriate to procure an immediate £3 billion increase in public expenditure. I am as keen as he is to move away from the grossly excessive levels of unemployment in the Western world, including those in our own country. But I do not think that a simpliste remedy of that kind will produce the results my hon. Friend wishes.
  Mr. Budgen: Does the right hon. Gentleman agree that the proposals from the Labour Party to increase public expenditure in the coming year by about £3 billion can only lead to a combination of higher taxes and higher interest rates, or else to an increase in the rate at which the money supply grows?
  Mr. Lever: I am not aware of any such proposals from the Labour Party. I am aware that some of my hon. Friends are understandably anxious to increase the public services. I share their desire. It is a question of timing in relation to our economic achievement permitting increases in public expenditure.
  Mr. Pavitt: Is my right hon. Friend aware that public expenditure next year in the North-West Thames regional hospital authority area will increase by £1,015 million through no decision of this House but merely by accepting the Common Market directive on nurses? Since that authority is but one of 16 such regions, may I ask my right hon. Friend to give his attention to this matter? If that kind of money is available, would it not be better for the House to decide to give it to the nurses through their pay packets rather than putting it into this scheme?
  Mr. Lever: I am afraid that I am not as erudite on the details of this matter

  899
  as my hon. Friend. I shall certainly look into the point he raises.

  MINIMUM LENDING RATE
  Mr. Ridleyasked the Chancellor of the Duchy of Lancaster what steps he intends to take to mitigate the effect of 14 per cent. minimum lending rate on small businesses.
  Mr. Lever: As the hon. Member is aware, minimum lending rate was reduced last Thursday to 13 per cent. It is not possible to insulate small firms from rises in market rates of interest. I am, however, aware that these rates may sometimes raise special problems for small firms and I shall continue to seek other ways to help them, as we have done in the past year or so.
  Mr. Ridley: Although one is pleased at the fall in minimum lending rate, may I ask whether the Chancellor, in his charming way, has yet understood the essential point that high Government spending, particularly on wasteful job creation and job protection schemes, causes the Government to force up interest rates so as to borrow, thereby losing more real jobs in the private sector than they create bogus jobs in the public sector?
  Mr. Lever: I think that the rather naive assumptions which the hon. Gentleman invites me to make owe more to party polemics than to a desire to grasp the whole of this complex subject. Our borrowing requirement is firmly held in check. The rates of interest at present, for one reason or another, are higher than they were with the same borrowing requirement. The hon. Gentleman chooses wilfully to ignore a whole complex of factors at home and abroad which bear upon interest rates.
  Mr. Litterick: Can my right hon. Friend tell the House how much in interest charges the recent issues of Government securities will cost the taxpayer between now and the end of the century? Does he agree that that borrowing could have been had more cheaply?
  Mr. Lever: Without notice I cannot give my hon. Friend the cost in interest charges to the end of the century, or to
  900
  any particular time. The present high rates of interest are undoubtedly exceedingly costly. No one will welcome more than I shall any reduction in interest rates on all borrowings which the Chancellor of the Exchequer is able to make.
  Sir William Elliott: Does the right hon. Gentleman agree that the high figure which was reached for MLR was reached in a state of panic and was not connected with any sense of reality?
  Mr. Lever: I do not know that I find it reassuring that Opposition Members and some of my hon. Friends are achieving identical hallucinations on this delicate area of finance. No one could possibly suggest that that rate of interest was induced by a state of panic. It was a judgment reached after due consideration. The rate was dropped as soon as market conditions made it possible.
  Mr. Skinner: Is it not a fact that it has been widely reported that, as a result of minimum lending rate going up to 14 per cent., some of the City friends of the Chancellor of the Duchy have made a killing during that three-week period when the Government were selling gilts in that way? As my right hon. Friend has just raised the question of the PSBR again, may I ask whether he takes into account the fact that it is costing about £4,000 million to finance the dole queue? Is he not aware that that is one of the factors which is creating inflation and leading to this figure of 14 per cent.? It is at that end that he ought to start doing some work.
  Mr. Lever: My hon. Friend raises two interesting points. The first relates to the profits made by some people in dealing in gilts. All I can say is that of course some people make profits from time to time dealing in gilts. Otherwise, they would not deal in them. If my hon. Friend were to offer me a gift of either the profits made recently dealing in gilts or the losses that have been made in gilts in recent years, I am afraid that I should have to tell him that the latter would quite dwarf the former.
  The second point raised by my hon. Friend is important. The key problem for the Government in a difficult inflationary situation such as we have now is how to prevent the measures taken to

  901
  curb inflation from further adding to the public sector borrowing requirement by increasing the unemployed, non-wealth-creating sector of our economy. I share my hon. Friend's anxiety on this score and am anxious that we tackle this problem so as to reduce the PSBR, as well as the human unhappiness and wealth loss which results from this high level of unemployment.
  Mr. Gowasked the Chancellor of the Duchy of Lancaster what recent representations he has received from those living in the Duchy about the increase in minimum lending rate to 14 per cent.; and if he will make a statement.
  Mr. Lever: None, Sir; but I am sure that last week's reduction in minimum lending rate to 13 per cent. will be widely welcomed.
  Mr. Gow: Will the Chancellor of the Duchy of Lancaster tell the House and those who live in the Duchy what is his assessment of the influence on the minimum lending rate of the Government's present borrowing requirement? Will he do that in the context of what he said a moment ago, namely, that it is desirable to reduce the public sector borrowing requirement below the figure of £8,500 million?
  Mr. Lever: I hope that the hon. Member has not quoted me accurately. I made no such assertion about the extent of the borrowing requirement. The Government have made clear that they do not want the borrowing requirement to be inflated and that they intend to keep it firmly under control. The rate of interest that we have reached, in my opinion—since the hon. Gentleman asks for my opinion—does not derive from the size of the Government's borrowing requirement. It derives from a number of other factors too numerous to retail now.
  Mr. Wigley: In view of the high level of interest rates and the likelihood that they will remain at this level for a time, is the right hon. Gentleman satisfied that adequate funds are available for industry and in particular small companies which are starting up for the first time? Would it be helpful to have a low-interest fund available to these companies?
  Mr. Lever: Availability of funds and the rate of interest are not necessarily the same thing. As the hon. Gentleman
  902
  knows, the Welsh Development Agency has done a splendid job in providing funds. COSIRA and other agencies have done well in the United Kingdom generally. There are special difficulties for the smaller firm in finding finance. I shall keep under constant review what might be done to extend the facilities for providing finance for these smaller firms.

  SCOTLAND (COURTS DISPUTE)
  Lord James Douglas-Hamilton(by private notice) asked the Secretary of State for Scotland, bearing in mind that justice in Scotland has been suspended indefinitely in the Court of Session, the High Court of Justiciary and most sheriff courts as a result of industrial action by clerks of court, whether he will introduce emergency legislation to deal with summary criminal cases and civil cases, for example, actions for personal injuries which may be affected by time-barred prescription.
  The Secretary of State for Scotland (Mr. Brace Millan): I regret to say that since 23 February the Court of Session, the High Court of Justiciary and the majority of the sheriff courts have been seriously affected by industrial action taken by members of the Society of Civil and Public Servants and the Civil and Public Services Association.
  The Lord President of the Court of Session has made rules of court suspending normal sittings in these courts, except for certain categories of business, and also suspending procedural time limits laid down by the courts. Under the arrangements made, all courts are dealing with very urgent matters, for example, interim interdicts and committals of persons charged with serious offences. Moreover, some sheriff courts are able to deal with other matters.
  I recognise that the position is serious and unsatisfactory and, along with my right hon. and learned Friend the Lord Advocate, I am keeping the whole situation under continuing review to see what further measures, including emergency legislation, may be required.
  Lord James Douglas-Hamilton: Is the right hon. Gentleman aware that under section 23 of the Summary Jurisdiction (Scotland) Act 1954 all summary criminal

  903
  cases must be brought within six months? If the right hon. Gentleman does not introduce emergency legislation, many persons who are charged with crimes in Scotland will have cause for great rejoicing. They may never appear in court. That is most unsatisfactory for the rule of law.
  Mr. Millan: The Acts of Adjournal deal with these and similar matters. We are containing the present situation, but I have not ruled out legislation.
  Mr. Dalyell: I recognise the delicate situation in the courts, but how long does the suspension of time limits last?
  Mr. Millan: I do not think that a limit has been imposed. We have suspended the sittings so that the time limits do not apply.
  Mr. Henderson: Following that new version of the West Lothian question, will the Secretary of State consider civil as well as criminal cases? People may be time-barred from bringing an action if it is not launched within a specific period. Is the Secretary of State satisfied that there are sufficient arrangements to protect people's rights?
  Mr. Millan: For normal cases the Acts of Sederunt that have been made by the Lord President of the Court of Session deal with the immediate situation. I appreciate that a number of cases may become time-barred and require legislation. If legislation were introduced, it would have to be retrospective, so that no one would fall outside such powers.
  Mr. Monro: The Secretary of State does not appreciate the seriousness of the situation. Law and order have ceased to function in Scotland. Will the right hon. Gentleman introduce legislation this week? He has given no indication of the time scale. The matter should not be allowed to drift on week by week.
  Mr. Millan: I have no intention of allowing matters to drift on, but I do not think that I shall be able to introduce legislation this week.
  Mr. Failbairn: Does the Secretary of State appreciate that fundamental constitutional rights are being denied to the citizens of Scotland? It is nonsense to say that the Acts of Adjournal deal with statutory summary rights. Only emergency legislation by the Government can do that. It is a most serious constitutional matter. Does the Secretary of State also
  904
  appreciate that I wrote to the Prime Minister on 26 February asking him to take it up at that level? I have not even had the civility of a reply.
  Mr. Millan: What I said previously applies. If there are gaps that require to be dealt with by legislation rather than by further Acts of Adjournal, I shall consider them. I wish to ensure that no one charged with a criminal offence slips through the net because of the present situation.
  Mr. Teddy Taylor: Does the Secretary of State agree that the disruption of courts and of justice in Scotland is of the utmost constitutional gravity? Will he give a clear assurance that there is no possibility of an accused person being released and not being brought to trial? Secondly, when will there be emergency legislation? Thirdly, what steps are being taken to resolve this desperately serious situation?
  Mr. Millan: I am open to suggestions on the hon. Gentleman's last point, but so far there have been none. The situation in the courts is part of a larger dispute involving two of the Civil Service unions. I do not know whether the hon. Gentleman is suggesting that we should simply give in to the demands of the unions. I hope not.
  I can give the assurance on the general position that the hon. Gentleman asked for. He will appreciate that that is dependent on a number of petitions that my right hon. and learned Friend the Lord Advocate has made to the courts in Scotland. I assume that if further petitions are necessary these will come forward, and I must assume that the courts will grant them. But these are individual cases to be decided by the courts rather than the Government.
  Mr. Taylor: In the absence of a settlement, when will emergency legislation be required?
  Mr. Millan: I said that I was keeping that question under continuing review. I am not prepared to give a time for emergency legislation, should that prove necessary.

  NEW MEMBERS
  The following Members took and subscribed the Oath:
  David Charles Waddington Esq., for Clitheroe.
  John Bruce-Gardyne Esq., for Knutsford.

  NATIONAL UNION OF JOURNALISTS
  Sir John Eden: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
  " the decision by the National Union of Journalists to expel several hundred of its members employed in provincial newspapers who refused to go on strike; and the serious implications of that decision for the employment prospects of the journalists concerned, as well as for the freedom of the press."
  Recently the NUJ called a strike among its members employed by provincial newspapers. No ballot of the membership had been taken, and in a number of places separate local pay increases had already been negotiated. The concurrent national agreement still had some time to run. Several hundred journalists refused to strike, and continued at work. These included journalists employed on the Bournemouth Evening Echo and its associated newspapers in other parts of the South.
  After the strike the union set up its own investigative procedures and "tried" its members who had refused to strike. This "flying assize", as it was called, caused widespread concern, and a number of us tabled early-day motion No. 231 criticising what had been done. Journalists who had refused to strike expected some retribution, in the form either of a fine or of the temporary suspension of their membership. But the union has gone much further. As one leading journalist in my constituency put it "The union has gone crazy. It is destroying a complete branch." In fact, last Wednesday 33 journalists on the Bournemouth Evening Echo were told that they were to be expelled from the NUJ. The same harsh treatment has been meted out to others in Weymouth, Southampton, Birmingham, Nottingham and elsewhere.
  This is a very serious matter. It will have the most damaging effect on the career prospects of the journalists concerned. It will debar them from employment where there is a closed shop agreement in favour of the NUJ, and that covers most of Fleet Street, the provincial press and broadcasting. This is going to an extreme. The punishment is excessively
  906
  severe and I hope that the union will think again.
  The union action also carries grave implications for the freedom of the press. There are those, including the present Leader of the House, who have tried to establish the NUJ as the sole union to be recognised in journalism. Let us hope that that day never comes.
  Even as things are, the power to deprive a journalist of his or her livelihood provides immense opportunity for coercion in a wider field. What is now being done in support of a union diktat in the furtherance of a pay claim could so easily become a weapon for regulating the nature and content of material to be published. That must cause deep anxiety in this House and it should be the subject of our most urgent consideration.
  Mr. English: On a point of order, Mr. Speaker—
  Mr. Speaker: Order. There can be no point of order until I have answered the right hon. Gentleman.
  Mr. English: But you may be answering him under a misapprehension, Mr. Speaker—
  Mr. Speaker: Order. I take the words of hon. Members as they come. I shall give my ruling accordingly. If the hon. Member for Nottingham, West (Mr. English) wants to raise this matter afterwards, of course I shall listen to him.
  The right hon. Member for Bournemouth, West (Sir J. Eden) asked leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
  " the decision by the National Union of Journalists to expel several hundred of its members employed in provincial newspapers who refused to go on strike, and the serious implications of that decision for the employment prospects of the journalists concerned, as well as for the freedom of the press."
  I listened with anxious care to the right hon. Gentleman. The House knows that, however important the matter, it is not for me to decide whether it should be debated; I merely decide whether there shall be an emergency debate.
  As the House knows, under Standing Order No. 9 I am directed to take into account the several factors set out in the

  907
  Order but to give no reasons for my decision. After listening very carefully to the right hon. Gentleman, I have to rule that his submission does not fall within the provisions of the Standing Order, and therefore I cannot submit his application to the House.
  Mr. English: On a point of order, Mr. Speaker. I am grateful to you. I am not competent to say what has happened in Bournemouth, but I believe that the right hon. Member may have unwittingly misled the House as to what happened in Nottingham—
  Mr. Speaker: Order. We cannot have an argument about facts now. If there is a point of order that I can deal with, I shall do so. Otherwise, there is no point in pursuing this matter.
  Mr. English: I would have thought, Mr. Speaker, that fact was important in this context. If six members of the NUJ are being threatened with eviction from their houses by their employers, as has occurred in Nottingham, that should be mentioned here as well—
  Mr. Speaker: Order. Perhaps the hon. Member would like to make his own Standing Order application.
  Several Hon. Members—
  Mr. Speaker: Order. I am not taking further points of order on a ruling that I have already given.

  EMPLOYMENT PROJECTS (TREASURY MEMORANDUM)
  Mr. Gow: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
  " the prospective loss of £800 million involved in the Government's so-called job saving projects, disclosed in a memorandum from the permanent secretary to the Treasury addressed to the permanent secretary to the Department of Industry, and described in The Guardian newspaper of 28 February 1979."
  Last Wednesday The Guardian disclosed the contents of a memorandum from the permanent secretary to the Treasury which showed that over the four
  908
  months ended December 1978 the Government initiated seven job-saving projects involving the country in losses of up to £800 million.
  I must satisfy you, Mr. Speaker, that this matter is specific, and I shall deal first with the specific nature of the projects. I take first the Rolls-Royce project, which the memorandum states is inherently risky and, even on an optimistic assumption, could not be expected to break even until 1993.
  My second instance is the British Aerospace 146 project, in which launching costs are expected to be between £250 million and £300 million, with a loss to the country of between £90 million and £210 million.
  The third specific matter to which I draw attention is the airbus project, in respect of which it is stated that there will be a negative cash flow of £300 million by 1983, and a loss, on today's prices, of £110 million.
  I turn to the importance of the matter. Sir Douglas Wass included in his memorandum the following statement:
  " We seem bent on, or have decided on, going ahead with projects which seem likely to waste economic resources."
  I believe that there is no more important matter for this House to discuss than the question of the control of Parliament over the expenditure of public money.
  The third criterion relates to urgency. There was a suggestion—I believe it to be well founded—that these projects had been initiated during the four months ended 31 December 1978 because it was widely assumed that during that period a general election might fall. It is now even more likely that we shall have an early general election. Unless this House debates this matter urgently, who knows what the Government Front Bench will get up to in trying to buy votes at the next general election?
  I consider that this submission fulfils all three criteria. It is specific, it is important, and it is urgent that the House should debate the matter.
  Mr. Speaker: The hon. Member gave me notice before noon today that he would seek leave to move the Adjournment of the House for the purpose of discussing a specific and important matter

  909
  that he believes should have urgent consideration, namely,
  " the prospective loss of £800 million involved in the Government's so-called job saving projects, disclosed in a memorandum from the permanent secretary to the Treasury addressed to the permanent secretary to the Department of Industry, and described in The Guardian newspaper of 28 February 1979."
  As the House knows, under Standing Order No. 9 I am directed to take into account the several factors set out in the Order but to give no reasons for my decision. I have given careful consideration to the representation which the hon. Gentleman has made, but I have to rule that his submission does not fall within the provisions of the Standing Order. I therefore cannot submit his application to the House.
  Mr. James Lamond: On a point of order, Mr. Speaker. Is it causing you any concern that a practice seems to be growing up of Opposition Members raising Standing Order No. 9 applications with the purpose of making speeches about matters which have appeared in the press recently on which they know they would not otherwise be able to speak? We have just heard an Opposition Member make reference during what was supposed to be an impartial submission to the Government's buying votes and to the Government's so-called job creation programme.
  I should like to suggest to you, Mr. Speaker, that you examine the speeches being made by Opposition Members in support of Standing Order No. 9 applications to see whether those Members are keeping strictly within the Standing Orders of the House.
  Mr. Madden
  Mr. Speaker: I shall hear the hon. Gentleman before I comment on the point of order.
  Mr. Madden: Adding to what my hon. Friend the Member for Oldham, East (Mr. Lamond) has said, I am sure, Mr. Speaker, that you will agree that over recent weeks we have heard a large number of applications under Standing Order No. 9. I am sure that the House would be grateful for a reminder from you, which you have given from time to time but which seems to have been overlooked recently, that the main objec-
  910
  tive of such applications is to advance arguments why a debate should be granted rather than to advance the substance of matters which would be heard in such a debate.
  A number of hon. Members are placed in great difficulty. The right hon. Member for Bournemouth, West (Sir J. Eden) made reference today to a situation existing in many parts of the country, and my hon. Friend the Member for Nottingham, West (Mr. English) clearly took exception to some remarks made about his own constituency. We are denied an opportunity of refuting inaccurate statements which may be made about our constituencies if applications are made as widely as they have been today.
  Mr. Speaker: The hon. Gentleman, if he were advancing an application for an emergency debate, would be one of the first Members who would wish to state the facts on which he based his application. It is within the power of the House to change its rules. There is a long-standing report waiting for discussion by the House which deals with this very question of Standing Order No. 9. Until the House changes its rules, I am under instructions to fulfil the rules that exist.
  The Lord President of the Council and Leader of the House of Commons (Mr. Michael Foot): Further to that point of order, Mr. Speaker. It is perfectly true, as you suggest, that there is a report which, if carried into effect, would deny the House altogether the possibility of raising Standing Order No. 9 applications at the present time in its proceedings. This is, of course, a matter for debate by the House. Some hon. Members might think that such a proposal, if implemented, would deprive Back Bench Members of their rights. Some might wish to resist it on that score. Whether hon. Members are trespassing so far as to breach the normal manner in which they can raise these matters is a different question altogether.

  BILL PRESENTED
  OUTLAWRIES (NO. 2)
  Mr. Ronald Bell, supported by Mr. J. Enoch Powell, Mr. Julian Amery, Mr. Hugh Fraser, Mr. John Biggs-Davison and Mr. Patrick Wall, presented a Bill to

  911
  vary the application of section 2 of the Southern Rhodesia Act 1965; to clarify the meaning of section 2 of the Immigration Act 1971; and for the better prevention of clandestine outlawries: And the same was read the First time; and ordered to be read a Second time upon Friday 30 March and to be printed [Bill 99].

  Ordered,
  That the Arbitration Bill [Lords] be referred to a Second Reading Committee.—[Mr. Thomas Cox.]

  Ordered,
  That the Consents to Prosecutions Bill be referred to a Second Reading Committee.—[Mr. Thomas Cox.]

ORDERS OF THE DAY
[SUPPLY]
[9TH ALLOTTED DAY]—considered.
HOUSING
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Thomas Cox.]
3.57 p.m.
Mr. Michael Heseltine: There is no better way of starting this debate than to set out the facts of the Government's housing record. Let me put it as briefly as I can. Last year saw the completion of 280,000 new homes, the worst figure for a full year since this Government came to power. Since 1974, 400,000 homes to rent have gone off the market altogether. Mortgage interest rates are now at 11¾ per cent., a higher level than under any previous Government. Land prices have risen by 18 per cent. in a year. House prices have risen by 26 per cent. in a year.
The conclusion of five years of this Labour Government has produced the worst new building record, the lowest number of private rented homes, a collapsed level of improvement grants, record-breaking interest rates, soaring land prices and rocketing house prices. It would be extravagant to claim that their housing record is the worst aspect of this Government's policy—there are a lot of competitors for that claim—but the fact is that 1978 has been a disastrous year for housing. Wherever there has been a slight glimmer of improvement in any field, it has not been as a consequence of Government policy but despite it.
The case against the Government's policies falls into three parts. First, their overall management of the economy has involved both decisions and measures that have worsened the housing situation. Secondly, the specific acts of policy that the Government have taken in housing have made things worse and not better. Thirdly, there is a whole range of decisions that the Government ought to have taken but have signally failed to do so.
I should like to refer first to the overall management of the economy. The level

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of interest rates is of particular sensitivity to many fields of housing where borrowing of one sort or another is so central a feature. The building industry itself relies on overdrafts, the house purchaser relies on mortgages and the local authorities depend on borrowed money. The consistent feature of the Government's economic policy has been to borrow at such a level for their public sector borrowing requirement as to establish a climate in which record interest rates have prevailed. In order to borrow on that scale, the Government have been forced to keep interest rates up in the inflationary climate which their economic policies have created.
In addition, the Government's high level of personal taxation has reduced the discretion of the ordinary citizen to spend his money as he wants in the way that many of them would have done—in purchasing their own homes for the first time. So with both high interest rates and high personal taxation, the Government have squeezed out resources from the private housing sector.
If I gave just one figure, it would be that, over the whole period of this Government, as a consequence of the prevailing interest rates, the average mortgagor is spending £160 a year simply in extra interest charges over the level which obtained under the previous Government.
The effect on local authority housing has been as serious as the effect on the private sector of interest rates at their present crisis levels. Local authorities have found, as they are faced with the harsh pressures upon their finances, that to go on supporting a public sector housing system which is based upon a subsidy, for every new home built in its first year, of £1,200 per annum is increasingly beyond their economic resources.
Of course, the Government argue, in the hope that the argument will appeal to their supporters, that this has something to do with those authorities controlled by the Conservative Party. However, as the Secretary of State himself should know, the reality, as one can see in Manchester and Sheffield, for example, is that Labour-controlled authorities have felt exactly the same squeeze and have found no alternative to a cut in their levels of housing.
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It is Conservative authorities which, faced with these pressures, and as a result of their own convictions, have been seeking to mitigate the unfortunate local effects of these policies. In Leeds and Oxford, for example, they have been in the forefront in releasing land at low cost so that cheap, or cheaper, houses can be built by the private sector to enable young couples to get their first home.
The squeeze on public sector housing is coming partly from the Government's economic mismanagement and partly from the changing patterns of housing in various areas, along with the shift of emphasis in some areas away from new public sector building to the improvement of existing and older properties. There is thus no substance in the suggestion that Conservative authorities are the ones that are deliberately trying to contrive this situation.
Indeed, the reverse is true. All local authorities have come under great pressure from the Government's mismanagement of the economy, and the Conservative authorities are the ones that are seeking by every means in their power to mitigate the hard effects on their local citizens.
The second aspect of the case against the Government is that they have done many things to aggravate the situation in addition to their general preoccupation with the levels of public expenditure and the consequential effects of inflation. We have often warned about, and subsequently debated, the effect on housing programmes that the Community Land Act would unquestionably have. As time has gone on and the figures have become available, it has become clearer and clearer to any detached observer of the housing scene that that Act has proved to be an albatross around the necks of those responsible for providing houses.
In the first year of the operation of that Act, 1,600 acres were acquired under its powers and a miserable 53 acres were released for new housing. In the second year, it is some consolation that only 800 additional acres were acquired, but the only additional benefit to home construction was a further 100 acres released. So 2,400 acres were taken into public ownership and only 153 were released on to the market.
That is the practical statistical effect of the Act, but its attendant bureaucracy an

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the delay and uncertainty that surround it have had an incalculable effect upon the local authorities in their areas, and particularly upon the private sector.
The partner to the Community Land Act, the development land tax, has had an equally serious effect. With that tax pitched at the level chosen by the Government, there is now a major deterrent to anyone selling land. The incentive must be to hold land in the hope of a change of Government making it worth a person's while to put his land on the market.
The dilemma that the Labour Government will not face is simple. They will either have to make it worth people's while to sell land because people can see some return for themselves or rely on draconian compusory powers and resources from the public sector on a scale beyond even their wildest contemporary dreams.
But the present situation, of no such powers in the hands of the Secretary of State and no such public sector finance available to implement them if they existed, combined with punitive disincentives against the release of land and the workings of the Community Land Act, is a major reason for the soaring land prices which now dominate the housing industry. So those two areas are in crying need of reform. The Community Land Act must go, and the development land must be altered so that it ceases to be the disincentive to land release that it has become.
The Secretary of State will be as familiar as any other hon. Member with the evidence, now being collected by the House-Builders' Federation in its latest survey, that the shortage of land is now one of the growing crises in the medium-term provision of housing. It is no use waiting until the crisis overwhelms us or until we have a more buoyant economy. If we are to have the land on stream to make the houses available, action is urgently required and should be taken forthwith.
In their mortgage policies, which also come within the general remit of what the Government have done, the Government have actually sought to compensate for the failure of their house building programmes. This is the oldest Socialist solution, always presented in the light of experience. First, one fails to carry out
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the programme to which one is committed—they failed, in this case, to build the houses—and then one makes it much more difficult for those who might have built the houses to get the money to do so. So there is a double squeeze. The result is seen in this case in the form of mortgage rationing and in the drastic cuts in local authority lending for which the Secretary of State is responsible. They have contributed significantly to the dwindling home construction programme and therefore to the rise in prices.
The whole of this—the Community Land Act, the DLT, the mortgage famine and local authority reduction in finance for purchase—has created an atmosphere of far less confidence in the construction industry than is necessary if we are to see a revival in the industry.
The less confidence there is, the fewer houses there are; the fewer houses there are, the higher are the prices. So not only do we not have the houses; those who buy are forced to pay ever-increasing prices.
The Secretary of State will argue that, far from this being his fault, he introduced the Home Purchase Assistance and Housing Corporation Guarantee Act 1978, designed to help the first-time purchaser. I have been looking at the way in which that Act has worked in practice. With a great deal of ballyhoo, the Government promised that if someone saved for two years he would receive a grant of £110 maximum and a loan of £600 maximum. Thus, anyone who was prepared to wait that long could look forward to a total State provision of £710 to add to his own savings.
During the time in which people have been saving, however, house prices have been rising. During the time that someone has been saving in order to qualify for £710, the price of the average house for the average new buyer has risen from £13,200 to nearly £19,000. So the consequence of Government policies, which they believe are mitigated by their home incentives scheme, is to deprive people of £5,200 and make available £710 as a maximum, £600 of which is a loan. That is what one would describe as Socialist charity at its clearest.
I wish to turn to the effects of the Rent Act 1975. Since the present Government were elected, nearly 400,000 homes in the

917
privately rented sector have been withdrawn. It is estimated that there are 800,000 empty homes. Let me refer to what the Government have not done, in a dramatically worsening situation, in the provision of rented accommodation. With hundreds of thousands of empty homes and with a declining number of homes to rent, one would have expected the Secretary of State to publish a review of the Rent Acts. Surely, after all the years spent poring over statistics, examining the evidence and consulting the experts, and against a patently unacceptable position in terms of privately rented accommodation, one would have expected the Secretary of State to come forward with some solutions, suggestions and evidence—but not a bit of it.
This is one of the most unforgivable aspects of the right hon. Gentleman's security of tenure in the Department of the Environment. Why does he not publish the findings? Are they so unacceptable to his own personal convictions? Are the facts available to him so contrary to the case put forward, for his own Socialist reasons, by the Minister for Housing and Construction? It is intolerable that week after week, month after month, we see only prevarication in this serious area of housing hardship.
Mr. Bruce Douglas-Mann: Does the hon. Gentleman agree that the decline in the privately rented sector was even greater in the period following 1957, and was just as great in the period prior to the passage of the 1974 Act? Does he agree with the view of his hon. Friend the Member for Hornsey (Mr. Rossi) that, regardless of a change of Government, security of tenure in the private sector should be retained?
Mr. Heseltine: I am fully aware of the fact that when the Labour Party was in Opposition its members made so many threats against the private landlord that a considerable number of private houses were withdrawn from the market. But at least when we were in office we were building new houses at a rate which in some way compensated for the lack of privately rented accommodation. The charge against the Labour Government is that they do not provide enough houses to rent and cannot maintain an adequate
918
supply of new houses because they cannot build them.
Mr. Douglas-Mann: Will the hon. Gentleman please tell the House what is Conservative policy on security of tenure?
Mr. Heseltine: The hon. Gentleman knows full well that we have no plans to alter the existing security of tenure provisions, but we have made it clear that we wish to experiment with a short-hold concept to give a new security of tenure to those who take on a lease of accommodation which is at present unlet. That point has been made clear on a number of occasions publicly.
There are a number of areas in which the Labour Government have failed to act. I refer to one matter which has been debated in this House and which has been dealt with on other occasions by my hon. Friend the Member for Hornsey (Mr. Rossi). The Government must know that there are vast tracts of land owned by public and local authorities. The release of that land has a significant role to play in the provision of land for new housing. I do not understand why the Secretary of State, who was eventually prodded reluctantly and after too long a period to write to the chairmen of nationalised industries to get land released, is now apparently unable to recognise the priorities of this challenge. He is unable to produce evidence of the results that have flowed on a serious scale from the initiative that we persuaded him to make.
There are countless acres now in the hands of public authorities waiting for somebody somewhere to provide some money for development. The reality is that that money is unlikely to be forthcoming on anything like the scale that those who own the land will have to assume if the land is to be developed quickly enough. The real need is not to go on planning for it but to release it into the private sector so that people may enjoy the homes built upon it.
The next area that requires action from the Government is that of planning. The House is rightly concerned with the high levels of unemployment. We are constantly told of the time that it takes to obtain planning or byelaw approval. The fact is that countless jobs and millions of pounds of investment are literally

919
stagnating in the filing trays of the bureaucracy. I am not keen on dismantling the purpose of our planning machinery; I wish to see it streamlined and speeded up. I also wish to see rapid decisions reached, so that we do not prejudice investment and jobs. That element must have priority.
Let me give one example. The city of Leeds is able to offer a decision within 28 days to anybody who makes a planning application for home improvement. That is a remarkable initiative by that authority, and it should be emulated widely by a larger number of authorities.
There is another initiative that is open to the Government and is long overdue. They should give to council and new town tenants a new deal by involving them in the provision of their own homes. This requires generous discounts to enable them to buy, and a charter to establish their own rights and status. This will release more cash for other and more important priorities and will give real incentives and choice as well as security to millions of families who have lost dramatically while the rest of the nation has gained from the benefits of a property-owning democracy.
Anybody who has the slightest doubt about the real interests of the Labour Party should have examined the newspaper reports about what happened to a local Labour councillor in Slough who had the temerity to buy her own home from the GLC. Her local Labour executive said that if she intended to buy her own home from the GLC she would no longer be required to be a Labour councillor. One can dismiss such action as the aberration of one local Labour council, but the matter then went to the Labour Party's southern regional headquarters, and on 16 February that Labour councillor lost her appeal. She was told "Sell your council house again and you can continue to be a Labour Party candidate, but so long as you own your council house you must give up your candidature."
Is that compatible with the Secretary of State's view about the benefits of a property-owning democracy? Does it accord with the idea of the spread of wealth and the proposal to give people a stake in their own society? This is what real, nasty, mean Socialism is all about—and everybody knows it.
920
If we look at the record of the Government's housing policy, we see that it has a sad familiar theme. There have been election promises in plenty and on a grand scale. Many claims have been made in the past about social improvement, the enrichment of the poor, and targets aimed at dramatic improvement of the nation's housing situation, but the harsh facts, which are always characteristic of the end of a Socialist Administration, amount not only to statistical failure. Much worse—and this is typical of Labour government—those who own their own homes have seen the capital values of their assets protected from inflation.
Those who have suffered from the actions of the present Government are those whom the Left always claims to help—those who want to buy their own homes but who are now further than ever from the reality of being able to do so. I refer to the young couples who need to find their first rented accommodation but who now know that that is much more difficult than ever to achieve. I refer to those, everywhere, who have listened to the easy promises and who have voted, having heard generous words, but who have been rewarded only with mean deeds.
4.19 p.m.
The Secretary of State for the Environment (Mr. Peter Shore): The House always enjoys the speeches of the hon. Member for Henley (Mr. Heseltine)—and today's speech was no exception. It is nine months since we last debated housing on the Floor of the House, and we all know that that period is the normal time for gestation and for the consideration of new ideas, new concepts and perhaps even new policy. However, I fear that the period of nine months did not produce very much from the hon. Gentleman this afternoon. Much of his comments were a weary rehash of other and better speeches which he has made in the past two or three years. We shall not get very far by selectively quoting and misquoting bits of the housing picture at each other.
The hon. Gentleman is entitled to say what he wants about land and the Community Land Act, but there are two matters of very serious importance about land. I put one of them to the House the

921
last time that we had a debate on housing. I said that it is the price of housing land that matters. The truth is that under the more or less free market regime operated by the previous Government prices for private houses rose by 200 per cent. between March 1970 and March 1974, which is almost exactly the period of the previous Conservative Government.
Between March 1974 and March 1978—that is, the first four years of Labour government—house prices did not rise by 200 per cent.; they fell by 30 per cent. In the last 12 months I reckon that those prices have at most reached the level that they reached in 1974. This will soon be put to the test, but I do not think that the general orders of magnitude are seriously affected. There was a 200 per cent. increase in four years under the Conservatives, and virtual stability for four and a half years or more of Labour government.
As for shortages of land, what the hon. Gentleman said is not true. The information that we have is that at least three years' supply of land is available for housing, with planning permission. This includes serviced land as well. I understand that there could be a problem emerging from the whole structure plan system about whether sufficient housing land is being set aside, but I believe that it is a problem for some time ahead. It is not one which operates on the present housing situation. So much, then, for land and land prices, which is an important issue.
I turn now to the other chief accusation made by the hon. Gentleman. He used the words "mortagage famine". I do not know where he has been. More mortgages, as hon. Gentlemen well know, were made available in 1977 than in any previous year. In 1978 the same record level was achieved. If it is a mortgage famine when some 800,000 mortgages are supplied, I do not know what is meant. It is an abuse of language and is part of the general intellectual sloppiness which we have come to expect from the Conservative Front Bench.
The third point that I put to the hon. Member for Henley is that there is no surprise at all in the fact that the private rented sector has been in long-term secu-
922
lar decline. If the rate of decline is as he said—that is, 100,000 a year since we have been in power—all I can say is that it has been declining at the rate of 100,000 a year for the past 20 years or more. The reason for that is that so many private tenants are, with my encouragement and that of others, becoming owner-occupiers.
Mr. Heseltine: Does the Secretary of State equate intellectual sloppiness with telling the House that the number of private mortgages has increased when he significantly fails to tell the House that there has been a dramatic reduction in the number of local authority mortgages?
Mr. Shore: The total number of mortgages available in the public and private sectors is running at a record level. If the hon. Gentleman will contain himself, he will find that there were two years in which local authority mortgages increased dramatically. Why? They went up dramatically during the first year of the Labour Government in 1974 because there was a terrible falling off—a real famine—of private building society mortgages which was brought about by the financial recklessness and lack of forethought of the previous Government. Therefore, that argument does not stand up.
The hon. Gentleman made a point with which I agree. Since we are now establishing a point of agreement, we should hear what it is. He said that one way of easing and improving the general situation would be to make the planning machinery work more effectively. To that I say "Hear, hear ".
We experience delays in the planning machinery because that machinery was designed to operate within a single tier of government. As the hon. Gentleman knows, that machinery was divided and was one of the many follies in local government reorganisation proposed by his right hon. Friend the Member for Worcester (Mr. Walker).
I have accused the hon. Gentleman of not having any new thoughts during the nine months since our last debate on housing, but I am glad that at the weekend conference in London at which the hon. Gentleman spoke—although not directly on housing—he clearly came to a view which I have held and propounded. It is that a measure of organic change

923
is necessary in local government and that the planning functions which overlap at district and county levels should be redistributed and simplified, along with transport and highways functions. Congratulations to the hon. Gentleman. My only regret is that we have not yet been able to carry him with us on direct housing policies. No doubt we will.
Mr. Hugh Rossi: I am sure that the right hon. Gentleman does not wish to mislead the House about the rise in house prices. If I understood him correctly, he said that we are now back to 1974 prices. If he looks at the figures produced by the Building Societies Association, he will find that at the end of 1974 the average house price was £11,000, that at the end of 1977 it was £13,700, and that at the end of 1978 it was almost £18,000. That is a very sharp increase in house prices under this Government.
Mr. Shore: The hon. Gentleman is so clearly confused that it must be entirely my fault. I was referring, as I thought the House understood, to housing land prices. I was not referring to house prices at all, though I am willing to.
Mrs. Elaine Kellett-Bowman (Lancaster): I am confused as well.
Mr. Shore: I am sorry if I have confused the hon. Lady. I distinctly thought that I was talking about land prices. I can remember referring to a figure of 200 per cent. for between 1970 and 1974, and a minus 30 per cent. figure for between 1974 and 1978. However, I am always willing to remove misunderstandings.
I think that the House will want to take account of the findings of the national dwelling and housing survey published a week ago. I am surprised that there was no mention of it in the hon. Gentleman's speech. This is probably the most important survey of housing conditions since the 1971 census. In many respects it goes beyond it. The survey shows in some detail the substantial progress that has been made in dealing with housing problems since the 1971 census. Numbers are important, and I shall quote some figures. However, progress in housing is much too complex to be judged simply in terms of the crude numbers of dwellings constructed.
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Between 1971 and the 1977 survey the supply of housing increased by 1£ million dwellings and we now have a figure, towards the end of 1977, of 17,244,000 dwellings in England. The number of households in this period increased by 1 million. The House will be glad to know that the number of households lacking the exclusive use of basic amenities—by which I mean a bath, a lavatory and hot and cold water—was halved from 2·8 million to 1·4 million. The number of families sharing a home fell from just under 800,000 to 528,000. The number of overcrowded households fell from nearly 220,000 to 73,000. The number of families unsatisfactorily housed, as a result of all these causes, was nearly halved, from 3·8 million to just on 2 million.
Housing conditions vary widely up and down the country. But among the 2 million families which are still inadequately housed a hard core of at least 1,500,000 are living in circumstances which most of us would regard as being unacceptable by today's standards. But we must not overlook that that hard core shades off into those living in housing conditions which, although less unsatisfactory, should be improved.
Housing conditions should no longer be judged solely in terms of the state of the fabric and of the amenities. We must look also at whether people are satisfied with the housing that they are occupying. An encouraging feature of the national dwelling and housing survey was that 80 per cent. of those surveyed were satisfied with their houses. But we must also examine carefully the reasons for dissatisfaction among the 20 per cent. and at where those who are dissatisfied are living.
It is no surprise that dissatisfaction with housing is greatest in our inner city areas, particularly in London. For example, 127,000 families with children under the age of 10 are still living at above first floor level who ideally should have homes with gardens.
The conclusion that I draw from the survey—and there is far more material in it than that to which I have alluded—is that the housing policies which we have pursued since 1974 broadly have been on the right lines. But we need now to sharpen our attack on the worst housing problems. The main thrust of this attack

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must continue to come from investment of public money.
Secondly, we need to widen choice—to enable people to move more freely from area to area and to select the type of housing and tenure suited to their needs. Thirdly, we need to remove causes of dissatisfaction, not only with housing but with the general environment in which the housing is sited. That last challenge is greatest in our inner cities.
Our key instrument in planning housing policies is the annual housing strategy and housing investment programme. This is a major step forward. By obtaining a better understanding of local housing needs, the Government are now in a position to direct resources where they are most needed.
The Housing Consultative Council, which we set up in 1977, is playing an important part in the planning process. We now have three-year programmes, which are planned in advance, and the arrangements for switching spending between programmes and between years. This provides the flexibility which is required.
One of the results of our initial approach to housing investment programmes on a local basis is that we have been able to move resources into areas and certain regions which previously were under-provided under national allocations of capital resources. The North-West has been a particular beneficiary, and I am glad that it has. I am also glad that we have been able to put additional resources into the inner city areas, particularly into those areas which are part of the partnership scheme or the programme groups of local authorities.
Housing associations are also playing a full part in improving housing conditions. They have been helped by the new Government grant system which was introduced in 1974. Their annual programme is now running at over 35,000 new or improved homes. That is more than four times the level that existed before 1974. We value this contribution, particularly at a time when local authorities controlled by the Conservatives are not always carrying out their duty to provide housing for those in need.
We are now developing our policies further with the objectives that I ex-926
plained earlier—sharpening our attack on the worst housing, widening choice and improving satisfaction. Where changes in the law are needed to secure these objectives, we shall be laying before the House our new housing Bill, which we hope to introduce well before Easter. The decisions reached as a result of our review of the Rent Acts, on which I shall report to the House as soon as possible, will also require legislation—but not in this Session.
I shall not anticipate the speech that I hope to make on the Second Reading of our new housing Bill but I wish to illustrate how some of the provisions of the Bill will relate to our main objectives which have been given extra force through the national dwelling and housing survey.
First, we want to concentrate allocations of capital on the areas of greatest housing need. We must ensure that substantial programmes in building and house improvement are carried out in those areas where they are needed and that the new subsidy arrangements help those local authorities with the heaviest responsibilities.
Mr. Stephen Ross: Does the Secretary of State accept that the greatest housing need, in order to deal with population increases, is in the South and West of England? Does he accept that a greater financial contribution should be made to those areas?
Mr. Shore: With the Housing Consultative Council we shall be considering the regional allocation of housing capital on a year-by-year basis. That is the first part of the exercise which leads to the allocation within the regions to particular local authorities. I shall certainly undertake that that will be kept under review. We shall, of course, be increasing the influence in our decisions by the knowledge that we are accumulating about local housing needs.
We must arrest the decline in houses which are well past middle age but which can still have many years of useful life if they are properly looked after. Local authorities and housing associations have a role to play, as do private owners.
Under the Bill we shall offer easier access to grants for the installation of basic amenities—a bath, inside lavatory, hot and cold water, and so on. We shall

927
give both public and private tenants the right to apply for grants. We shall extend the present availability of repair grants for older houses of limited rateable value. We shall take wider powers to vary the rates of grant generally.
To improve satisfaction we shall, in the new Bill, be giving statutory rights to council tenants, including rights to security of tenure. We shall be establishing machinery to enable tenants to be consulted about decisions affecting the management of local authority housing. I attach particular importance to improving housing estates which have become run down in different ways.
At one end of the spectrum are those estates which are beginning to suffer from a general pervasion of drabness. There is considerable life in the buildings, but they need interior modernisation, a brighter appearance and fresh landscaping. I intend to see that the costs of the necessary effort are recognised in the new housing subsidy system.
Towards the other end of the spectrum are estates where the problems are more serious and where decline has gone much further. Such estates are often notorious locally. They are labelled "problem estates" or "difficult to let". The decline of such estates is made manifest in transfer requests, in empty boarded-up dwellings and in repeated vandalism. It is no wonder that tenants feel dissatisfied, if not stigmatised. These estates call for a concerted attack, using the best management skills in the housing service and enlisting the aid of other social agencies. I intend therefore to put specific proposals to the local authority associations for a priority estates programme.
Local authorities will be asked to prepare programmes to tackle the fundamental social and environmental deficiencies of the estates, to reduce vandalism and insecurity, and to raise standards of caretaking, cleaning and maintenance to a level which restores residents' pride in their homes.
I shall help in two ways. First, I shall channel capital resources to these priority estates. Secondly, I shall give both capital and current expenditure on these priority estates a special place within the new subsidy arrangements. Where capital expenditure is needed on a more
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modern estate, I shall be willing to consider relaxing the so-called 30-year rule which would otherwise exclude subsidy on such expenditure. In those extreme cases where demolition is the only sensible course, I shall consider whether the circumstances justify the continuation of subsidy on the outstanding loan charges.
Mr. Eddie Loyden: In making these assessments and judgments, will my right hon. Friend bear in mind that serious mistakes, of which he is well aware, have been made in post-war building on some of the larger estates? If the suggested alternatives for carrying out the remedial work that my right hon. Friend anticipated could be carried out were unsuccessful, would demolition of those types of estates also come into question?
Mr. Shore: The demolition of estates is pretty well the end of the road. One would not wish to use that option, except in those special cases. However, I do not rule it out. What I have suggested is of the greatest practical value and meets the kind of experience of which my hon. Friend the Member for Liverpool, Garston (Mr. Loyden) has direct knowledge—namely, the relaxation of the 30-year rule. I believe that quite a lot of modern estates have suffered from either bad design or bad treatment to a point where substantial money is needed and can be afforded only if new subsidy arrangements are made to the local authorities concerned.
Mr. Michael Morris: Will the right hon. Gentleman give way?
Mr. Shore: No. I do not wish to trespass longer than I need on the time of the House.
My third aim is to increase mobility. The new housing Bill will contain provisions to achieve this aim in the public sector. Local authorities will be required to set aside a proportion of their vacant dwellings for people needing to move because of their jobs. We shall also take powers to widen the scheme at a later stage to assist people who wish to move for family and social reasons. These measures will certainly enable more people to move from one area to another than is the position today. This is a long overdue change in the public rented sector.

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In the private sector, it is our aim to enable more people to become owner-occupiers, provided only that it is not at the expense of people in housing need.
Local authorities supply mortgages, as the hon. Member for Henley reminded the House, for a significant number of people—generally those who have smaller financial resources than most and who are seeking to buy older and somewhat cheaper houses. Local authorities perform an important service in that respect, but it is not helpful that, under present arrangements and legislation, they have to charge interest rates which reflect the general borrowing rate of the local authorities, even when that is higher than the prevailing rate of interest charged by building societies. Therefore, we intend to introduce new flexibility into their arrangements so that local authorities, with contributions from their rate funds, can alter the lending rate to bring it into line with the rate currently charged by building societies.
I believe that we have now, and we shall seek in the housing Bill to develop further, balanced, consistent, fair and even-handed policies for both the home owner and the council tenant. But it is right on this occasion, which is probably one of the last general housing debates that we shall have, to inquire about the policies proposed by the Opposition. I had hoped that the choice of this Supply day meant that the Opposition had not only decided what they intended to do on a number of major housing policy matters but would take the House and the nation into their confidence and tell us precisely what they proposed. But the speech by the hon. Member for Henley—far below his normal standard of performance—was greatly disappointing. Therefore, I should like to put a few questions to him or, if not to him, to his hon. Friend the Member for Hornsey (Mr. Rossi), who I understand will be winding up.
I think that we should know the Opposition's policy on mortgages. They have twitted me about the fact that mortgage rates have been higher. I agree that they have. But what is the Opposition's policy? Are they sticking to the old 9½ per cent. maximum which they put before the nation in 1974? The hon. Member for Henley knows that
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each percentage point of subsidy costs over £150 million. At the present mortgage rate, that proposition would cost getting on for £400 million a year. Are the Opposition prepared to find the money? If so, where is it to come from?
What about the scheme to pay £1 grant to intending owner-occupiers for every £2 saved with a building society? In its original form, that proposal would have cost about £350 million a year.
We know from recent statements and speeches that some disciplines have been imposed upon this rather generous scheme in recent months. As I now understand it, the scheme is to have a maximum of about £1,000 and to be limited to houses up to a given price. But I still think that we are entitled to know how much it will cost. We should also know how the money is to be found.
I think that I know the answer to that one. I assume that it will come out of higher council rents. The hon. Member for Hornsey, in an interview with the National Builder this month, said:
" The Conservative Party has always taken the view that the first public expenditure cuts should be in transfer payments—subsidies to sections of the community ".
That is a well-known statement of principle. But in that same interview the hon. Gentleman went on to say:
" In the housing field we shall look very, very closely at the £2,000 million a year paid in subsidies to council tenants."
So it is council tenants who will pay for what remains of these schemes to help home owners. But is it all that they are to pay for?
Mr. Rossi: Will the right hon. Gentleman give way?
Mr. Shore: In one moment. I should like to finish this passage. I shall be delighted to give way to the hon. Gentleman. What will they be required to contribute to the proposed cuts? If £500 million is knocked off the £2,000 million, to which the hon. Member for Hornsey referred, that would raise council rents by £2 a week. I think that 5 million council tenants are entitled to know that.
Mr. Rossi: The right hon. Gentleman knows the answer to this question. As he studies my speeches and articles so carefully, he will have noted what I said about this matter at the Conservative

931
Party conference. If he had read on in that article, he would have found that I said it was impossible and impracticable to raise council rents to the level necessay to make a substantial impact upon that deficit of £2,000 million a year. Therefore, we place great emphasis on our policy of the sale of council houses. Indeed, local authorities which have started to implement that policy have already found that they have been able to reduce the non-mandatory rate of contribution by very substantial amounts.
Mr. Shore: I am sure that we are all grateful to the hon. Gentleman for making that point. I was about to come to that aspect of the policy—the sale of council houses. That policy, at any rate in the hon. Gentleman's commitment, has in no way been weakened and qualified by what has been said on other matters in recent weeks and months.
If we are to have any kind of intelligent debate, I think that we must get clear one or two significant and important matters. The first question which should be answered is what discounts are to be offered to purchasers. Is it now official Tory policy to offer discounts at a minimum of 30 per cent., as stated in the model scheme published by the Conservative Political Centre in January 1978? Are discounts to be at 50 per cent., as mentioned on a previous occasion by the hon. Member for Henley? Or is the local council property to be given away, as suggested by the right hon. Member for Worcester?
Secondly, is it still Tory policy to restrict the sale of houses to those who occupy them—the policy set out in "The Right Approach"? Or does the national Tory Party endorse the policies of those Tory-controlled local authorities which increasingly have been putting council property on the open market to be sold to the highest bidder? Is it national Tory policy, as well as the policy of some Tory local authorities, to put on the market whole estates of houses newly built for renting, keeping them empty while they are expensively advertised and while estate agents search for customers? I hope, particularly, that we shall be provided with an answer to that latter point.
Thirdly, is it national Tory policy to include among properties which may be
932
sold on the open market dwellings which were purpose-built as old persons' dwellings and mobility housing? That would deprive the old and disabled of housing which they are queueing up to rent.
The hon. Member for Henley cannot be unaware that those are the policies currently being pursued by the present Conservative-controlled Greater London Council. Does the hon. Gentleman agree that those policies are outrageously irresponsible?
I have said more than once that Government policy on the sale of council houses aims to secure a decent home for all at a price they can afford. In areas of the country where the sale of council homes would frustrate the policy, we say that the sales should not be made. On the other hand, we recognise that increasing numbers of tenants wish to buy their homes from councils and have the means to do so. Naturally, they wish to stay among the people and in the places where they have lived for a substantial part of their lives. In areas where such sales will not damage the local authority's ability to meet the need for rented accommodation, the sales could certainly take place.
In inner city and urban locations particularly, many still have great difficulty in finding a home that meets their needs at a price they can afford. They can look only to their local council for a home to rent. In such areas of housing shortage, indiscriminate sales are irresponsible.
The houses most likely to be sold are those with gardens, which are needed most by families with young children. Invite the House to study the national dwelling and housing survey which has just been published. That reveals that in many inner London boroughs two out of three families live in flats built over the years by Conservative GLCs, Labour GLCs and borough councils because, in earlier years, there was perceived to be a gross land shortage and a land price problem which could not be easily overcome by the local authorities. We all know about those hardships. The indiscriminate disposal of houses with gardens is to be deplored.
The Government expect local authorities to make a careful and responsible assessment of their local housing need before deciding whether and how many

933
council houses to sell. We are opposed to indiscriminate sales and the level of discounts that some authorities wish to offer—which the national Tory Party wants them to be able to offer. The "sale of the century" approach to the disposal of public assets provides a short-term way of cutting taxes and rates. However, it is financially irresponsible because public assets cannot be given away without someone having to pay the bill in the longer run—whether it is the taxpayer, the ratepayer or council tenants who continue to rent. The sale of council houses is likely to impose a substantial longer-run loss on the public purse. The larger the discount, the larger the loss.
Mr. Heseltine: The Secretary of State knows that that is humbug. The release of resources by the sale of council houses and flats enables local authorities to spend on building new properties—with gardens, this time, if the land is available.
Mr. Shore: The hon. Gentleman and I have covered this ground before. In June 1977 the hon. Gentleman was pinned down to answer the question, if council houses were sold, what woud be done with the proceeds of the sale? His prompt answer was that it would be entirely up to the council concerned whether it spent the proceeds on housing or in any other way such as cutting rates or other matters that enjoy the priority support of the Conservative Party at national or local level.
This Government have helped tens of thousands of people to become home owners. We have shown that home ownership can be promoted without taking properties away from those who want to rent. The Tory policy—the unrestricted right to buy—is financially profligate and is certain to push back the date when the remaining hard core of our housing problems can be said to be resolved.
I have said that I expect local authorities to behave responsibly. I have warned that, while not taking precipitate action, I would examine their housing policies, particularly the housing investment programmes, to take account of their overall housing situation and the balance struck between policies for sales and policies for new building and improvement.
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I am satisfied that the time has come to put a stop to certain practices affecting council house sales. Today I sent to the local authority associations draft amendments to the ministerial consents with which they must conform when they sell their houses. I shall tell the House what those amendments are.
First, as foreshadowed some time ago, I shall put an end to the schemes under which tenants will be sold options to purchase the council houses they are living in, thus depriving future councils of the right to use their stock of houses to the best advantage of their local population. I regard it as outrageous for present councils to attempt to restrict the freedom of action of successor democratically elected councils. Secondly, I shall stop the sale of houses that have been newly built for letting and, with some transitional arrangements, the sale of newly built flats. Thirdly, I shall stop the sales of empty houses and flats that become available for reletting. I see no reason why those who are able to buy should not purchase in the private housing market, which can easily accommodate them, leaving empty council property to those who are in housing need.
The amended consents will still enable local authorities to continue with responsible policies of making sales to sitting tenants of at least two years' standing. Councils will still be able to build houses for sale and to operate equity sharing schemes.
Mr. Michael Morris: Would not the time of the Secretary of State be better spent in instructing the London borough of Camden to do something about the 6,500 empty homes in that borough? Why does he not direct his attention to the London borough of Islington, with its 6,600 empty homes, and the London borough of Tower Hamlets, with its 3,100 empty homes, and the London borough of Southwark, with its 6,100 empty homes? The majority of all those homes are owned by local housing authorities.
Mr. Shore: I agree that there are too many empty houses in London and in the boroughs to which the hon. Gentleman has referred. However, the hon. Gentleman should not be selective. There are an enormous number of empty properties in the borough of Westminster and they are not local authority-owned. There is

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a general problem that does not fall within the subject that I am dealing with now.
I believe that I have shown that substantial progress has been made in improving housing in this country in recent years. We are not the best housed nation in Europe, but we are among the top three or four of the nations with which we are able to compare the amenities and quality of our houses.
We have a range of further policies which we shall be bringing before the House in legislation in this Session. I have shown that our policies are, and are meant to be, fair and even-handed between tenure groups—in contrast to what remains of the policies of the Opposition, which are clearly designed to help one section of the community at the expense and, indeed, at the cost of another.
5.1 p.m.
Mr. Arthur Jones: The Secretary of State's announcements towards the end of his speech emphasise what many of us have always believed, namely, that he has an ideological approach and political objectives in housing, particularly on the sale of council property. There is no doubt that he is trying to prevent the legitimate policies of elected members of local authorities, and I am sure that that change of policy will be widely deplored.
The Secretary of State had little to say about housing associations, but I wish to direct my speech to the important role that they are playing. I recognise that the subject does not give the Secretary of State the opportunities for rhetoric that he seeks in his speeches on housing, but housing associations are important. The right hon. Gentleman said that 35,000 new and improved houses had been made available by housing associations and more than £600 million—more than £17,000 per unit—has been made available to associations this year.
There is concern about the complications in the housing association movement. In mentioning some of the proposals in the new housing Bill, the Secretary of State indicated further complications in housing support. I hope that they will be kept as simple as possible, in the context of the wise use of public resources. Some of the responsibilities placed on housing associations are time-936
Consuming and unnecessarily bureaucratic. I hope that ways will be found to simplify them.
Housing associations have a longer history as housing agencies than have local authorities, having been the first to pro vide social housing. The earliest such body, the Society for Improving Condition of the Labouring Classes, was established, as the Labourers' Friend Society, in 1830. It began its housing work in 1844 and survived for well over a century until the 1960s, when it was taken over by the Peabody Trust.
In terms of numbers of houses provided, such bodies were of minor importance until recently. Their nineteenth century significance was as a forerunner and catalyst of public provision and they clearly demonstrated that neither philanthropy nor private subsidies, such as charitable donations, could bridge the gap between the rent-paying capacity of the poor and the cost of providing decent housing.
When it was at last conceded, in 1919, that the deficiency had to be met by subsidies, they were made available to housing associations—or public utility societies and housing trusts as they were then termed. Local authorities were empowered to assist in the promotion of voluntary housing bodies, and in the 1930s provision was made for many of the housing functions of local authorities to be carried out through housing associations.
Originally, housing associations, like local authorities, provided housing for the working classes at below market rents. Until the end of the 1950s, the "traditional" associations made a modest, but useful contribution. Most of the associations were small, though there were notable exceptions, such as the Coal Industry Housing Association, set up by the National Coal Board, and the long-established Peabody, Guinness, Bournville and Sutton organisations.
In 1964, we saw the establishment of the National Housing Corporation as a promotional body and channel of finance. The 1964 Act provided for Exchequer loans of up to £100 million.
Some of the difficulties facing housing associations, traditional and new style, would probably have been resolved had there been greater Government interest,

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but the Labour Government, like many local authorities, had—I do not say have—no heart in that minor sector of their great housing campaign.
A committee of inquiry was set up in 1968 under the chairmanship of the late Sir Karl Cohen, who was not only a leading local housing protagonist but a firm believer that there was nothing that a housing association could do that a local authority could not do better. After two years of internal wrangling, the committee, to its own great relief, was disbanded in July 1970. I was a member of that committee and there was some surprise at the time that a Conservative Member should have been appointed to it. It was unfortunate that a great opportunity was missed by that inquiry. Much of what has happened since then could have been on a sounder basis if the Cohen committee had been able to come up with positive proposals.
Because it is voluntary, the effectiveness of the housing association movement depends principally on the energy and capacity of those engaged in it. There were a vast number of associations—more than 3,000—and a bewildering variety of types. Most were small and had few assets. Arrangements for finance were complicated and confused and there was a real risk of the exploitation of housing association assets, created with the aid of public funds, because of an archaic and inappropriate system of registration that applied to associations that were not technically charities. Efforts have been made and continue to register housing associations as charities.
The Government envisaged a "special place" and promised "encouragement and support". The associations and societies providing rented accommodation would be brought into the fair rent system and their tenants made eligible for rent allowances. That would neatly secure greatly increased rent income for the associations without hardship to tenants.
The Conservative's Government's proposals for housing associations were incorporated in the Housing and Planning Bill 1973 and, on the change of Government, formed the basis of the Housing Act 1974. There was, by this time, all-party suport for housing associations. I make a point of stressing that because the Minister for Housing and Construc-
938
tion deprecated something that I said earlier.
The Act transformed the national Housing Corporation from a relatively modest organisation channelling Exchequer aid to the voluntary housing movement, and badgering building societies to do likewise, to the dominant promotional supervisory and financial institution that it is today. The corporation was also greatly strengthened in staff, which about doubled between 1973–74 and 1975–76 to 363 and developed a close link with the technical side of the National Building Agency, both of which were chaired by Lord Goodman.
The new subsidy system was so generous as to be beyond the wildest dreams of the most ardent supporters of the voluntary housing movement. It was designed to meet the total deficit on each scheme, with rents fixed by the fair rent system.
Circular 73/78 gave details of how the housing association grants are calculated. There are three stages. First, the net qualifying capital costs of the project are determined. Secondly, the estimated running costs are subtracted from the income from fair rents and other sources to give the estimated net income attributable to the project. Thirdly, the residual loan, which the net income will service—that is, the present value of the net income—is calculated. The grant paid is the difference between the net qualifying capital costs and the residual loan.
The level of grant works out at an extremely high level, averaging 75 per cent. to 80 per cent. of a fair rent scheme. Not surprisingly, with subsidies at that level, the voluntary housing movement expanded rapidly. The corporation had to operate for a time under severe pressure, not simply to administer the grants system but to check the eligibility of applicant associations for registration.
There is a problem caused by the fact that the fair rent set for new housing association dwellings is often significantly higher than the reasonable rent set by local authorities for properties that are similar and are intended to house similar people. This follows from the different rent-fixing systems in the two sectors and the fact that, despite the very high subsidy on new housing association building, the true subsidy on an identical council house will be even higher, mainly because

939
of rent pooling. My hon. Friend the Member for Henley (Mr. Heseltine) told us that the subsidy on new council properties was about £1,200 a year.
To keep down the level of public expenditure, the corporation set about searching for private funding with Government guarantees. That involved establishing a separate organisation, the Housing Corporation Finance Company Limited, with 40 per cent. of the shares being held by the corporation and the remainder being held by some of the larger housing associations, such as the Guinness Trust, the Sutton Trust and the London and Quadrant Trust. With that respectable backing, and working through a City merchant bank, £35 million of private funds was raised.
I submit that this is a blatant dodge to avoid operations being technically counted as public expenditure. It was possible only because housing associations, despite their huge dependence on public money, are regarded as being part of the private sector. The Expenditure Committee had some sharp comments to make about this, not because of the Housing Corporation's acumen or the undesirability of the outcome in housing terms, but because of the nonsense of public expenditure conventions.
The high level of provision made for grants to housing associations reflects the expanding role of the movement, which is now responsible for building or rehabilitating about 40,000 to 50,000 dwellings a year. I do not think that the Secretary of State gave that figure, but I know that the expenditure is continuing to increase.
In November last year the loans outstanding under guarantee by the corporation amounted to £48 million. In 1979–80 housing associations financed by the corporation are expected to incur expenditure amounting to £450 million, of which up to £50 million will be financed from private sources. I have taken figures from the Treasury White Paper "The Government's Expenditure Plans 1979–80 to 1982–83", Cmnd. 7439. There we are given for land, new dwellings, acquisition and improvements a total for the current financial year of £606 million. The budget for next year is £581 million. These are tremendous levels of expenditure and use of public resources.
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The Environment Sub-Committee of the Select Committee on Expenditure looked at last year's housing figures and made representations about the information they contained and the method of presentation. Members of the Committee were pleased their their recommendations were accepted, and appreciation has already been expressed for the assistance of Professor J. B. Cullingworth, who was then in the Cabinet Office and who is now professor and chairman of the department of urban and regional planning at the university of Toronto. The Committee also had the benefit of the wide experience of Mr. Henry Aughton, who had served a lifetime in local government.
I declare my interest, as a member of the management committee of the United Kingdom Housing Association, chaired by Lord Greenwood. In addition to New-build, the association has as its specialist operations the provision of single-person accommodation and the purchase, conversion and improvement of older properties, particularly in South Wales.
I note that the Public Accounts Committee is inquiring into the subject of housing associations. I have a summary of points raised in evidence by Mr. G. C. Wardale, deputy secretary at the Department of the Environment, and Mr. J. R. Madge, chief executive of the Housing Association. They appeared before the Committee on 22 January and 24 January this year. I understand that the evidence has not yet been published and is subject to parliamentary privilege. I am sure that that is a valuable inquiry and that it reflects the great interest in the movement felt both by the housing associations and by the public generally.
I understand that the Government want to build on the success and to sustain the confidence of housing associations to undertake new development. However, the present subsidy arrangements have the important defect to which the Public Accounts Committee drew attention in its ninth report, namely, that they make no provision for the recovery of any surpluses that may be generated over a time by the effects of inflation on net income. I welcome the Department of the Environment's press notice of 19 February, which proposes that powers should be taken under which associations could be required to show in their

941
accounts any surpluses arising from property provided with the benefits of housing association grant.
Housing associations, like local authorities, were brought within the fair rent system in 1972, but they were not taken out of it in 1975 along with the local authorities. The fair rent system as applied to associations creates difficulties because of the resulting disparity with local authority rents. It produces anomalies in the rent structures of individual associations.
The computation of support for housing associations is complicated. It is set out in detail in circular 103/77, issued on 13 October 1977. It clearly tries to anticipate every situation. Although I appreciate that the arrangements are not intended to be open-ended, one is left with that impression and that they have the effect of bailing out housing associations that get into difficulties, some of which may be of their own making.
The whole operation places great responsibility in the hands of the staffs of the associations. The administration and supervision by the Housing Corporation is detailed and must be very time-consuming. I question whether the corporation is adequately staffed to meet its obligations, and I recall the recent difficulties over its annual statement.
The degree to which the housing programme is now related to the work of housing associations must be recognised, and the vast sums of public money involved must be supervised and monitored. In this regard I hear conflicting views. On the one hand it is said that the corporation is difficult and tardy and on the other that the degree of control is inadequate.
Responsibility also rests with the local authorities that are helping housing associations. I have seen recent reports of difficulties in which the Greater London Council has been involved. Reference has been made to a sum of nearly £9 million handed over to housing associations over which it is said there is no public scrutiny. That may happen because the associations concerned are not registered with the Housing Corporation. This must be proving an immensely time-consuming task. I won-
942
der to what extent adequate staffs are available to meet departmental requirements in this regard.
I welcome the fact that the Public Accounts Committee is undertaking an inquiry, feeling as I do that that is necessary both in the public interest and for the future of the housing association movement.
5.18 p.m.
Mr. Julius Silvennan: I do not propose to follow the lines of the speech of the hon. Member for Daventry (Mr. Jones), who gave a very interesting talk about the history of housing associations, although it is an interesting subject. I simply mention that there are all sorts of housing associations, as the hon. Gentleman knows very well.
I want to deal with the question of the sale of council houses, particularly of what I learnt in one of my advice bureaux only about two weeks ago, when I heard from two tenants who desired to buy their houses from the Birmingham council. They had been offered the houses at, I believe, £7,280. A little later they discovered that several of their neighbours living in houses identical in design and in the same block had been sold their houses for £5,000. That seemed to them, as it seems to me, to be extraordinary. Naturally, they were very dissatisfied, and they asked the council whether they could have a reduction to a similar price. The council said "Nothing doing". The tenants took up the matter with a local councillor, but they did not get very far. At the time they were told that two surveyors had valued the properties, that valuation was not an exact science, and that there was always some variation in price between one valuer and another, though it seems to me that a variation of about 50 per cent. is pretty steep even in a science which is not very exact.
Moreover, the two houses were in a good area—the Castle Vale area—where there are a great many flats. These are post-war houses of quite decent construction. There is no question of their being slum houses. They were built about 15 years ago. One wonders how any valuer could come to the conclusion that these houses were worth only £5,000.
Mr. Paul Hawkins: Were the valuations done at the same time? Being a valuer myself, I agree with the hon. Gentleman that valuation is a very inexact science and that horrible results can be thrown up in different parts of the same town. Were the valuations done at the same time, or were they a year or two apart?
Mr. Silverman: This is quite interesting, because I thought in the first place that the valuations had been done by two different valuers. However, it turned out from a letter which I received from the council that they were done by the same valuer at approximately the same time. I was also told that the housing authority had a panel of valuers, that they were reputable valuers, and that in any event a valuation formed the legal basis for agreeing to sell the house concerned at that price, though it seems quite extraordinary bearing in mind the price of property in that area and other areas of Birmingham. I repeat that it is not an old, dilapidated slum area.
Eventually, the two tenants pressed the matter further, only to be told that the original proposed price in any event was now a year out of date, that they would now be charged more than £7,280, and that they must enter into new contracts on that basis. That seems to me to be more and more outrageous. I do not know whether it was simply because they had the impudence to suggest that the price should be reviewed or whether the city council or the city solicitor thought that that was the law.
There have been other examples in Birmingham. One was referred to in a press notice issued by my hon. Friend the Member for Birmingham, Yardley (Mr. Tierney). But obviously cases of this kind create a great deal of dissatisfaction and outrage. I think that even Opposition Members will agree with that.
On making inquiries, I found that there was a great deal of variation, though not quite to the extent that I mentioned in these two examples. What the justification for the £5,000 is I do not know, although I have been told by the chief housing officer that the valuers insisted that the valuations were correct. Of course, they would do. But on what basis the valuations were made, I do not know.
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I am not against the sale of council houses, especially to sitting tenants, in circumstances where it is justified. I do not dissent from the idea of making people owner-occupiers, and I can understand why some tenants want to become owner-occupiers. They do so mainly for financial reasons. They see their rents going up year after year, and they would like some stability in properties which they own. Repairs are not being done, and they would like control of their own repairs. I quite understand their reasons for wishing to become owner-occupiers, and I am not against it. To tenants who have bought their houses I say "Good luck. Carry on. I am not blaming you. I am blaming the local authority which has a policy of selling its houses."
However, in Birmingham not only are council houses being sold to sitting tenants. The council is also selling void houses to people who are supposed to be on the register, and I say "supposed to be" advisedly. I do not know the qualification required from people who are supposed to be on the register. I understand that some inquiries have been made by local councillors from which it appears that this is simply an example of queue jumping by people who can afford to pay mortgage rates in order to get on the housing list.
Mr. John Sever: As a member of the Birmingham local authority, I may be able to help my hon. Friend. I think that he will find that when a tenant seeks a transfer, especially from high-rise accommodation or that which is considered to be generally unsatisfactory, he goes to the local authority and asks for a transfer, presumably to a desirable area, and often finds that he has not sufficient priority rating in the local authority system for such a move. It is then that the housing officer will ask "Have you considered buying a property in that area?" In such a case, some way is found by which the system can be avoided so that a purchase can be undertaken, resulting in the person concerned jumping the queue.
Mr. Silverman: I understand that there are colleagues of my hon. Friend on the council who have made inquiries and not found that. It may be the case, and I can understand it because in my own

945
constituency of Erdington I must have between 5,000 and 6,000 high-rise dwellings. A large number of the people living in those dwellings—people with children, and even some who have no children—would very much like to be transferred to houses with gardens where their children could play. Those who have no children and who have resided in the claustrophobic atmosphere of a high-rise flat would also like to transfer. Some people, of course, do not mind high-rise flats. They prefer the isolation of a flat because it gives them additional privacy. But a very large number would like to transfer. Their chances of transferring as tenants to houses are practically nil in my experience. To get a house with a garden in Erdington and in many other areas is practically like getting a lump of gold.
In the last few years, about 6,000 dwellings have been sold—a lot of them to sitting tenants, but some of them void properties. Speaking from a constituency angle and without raising matters of ideology, I say that this is terrifically unfair to those who have been confined to high-rise flats for 10 or 15 years. There is no question of ideology, of Socialism, capitalism or anything else. There is no reason why they should not have a fair and reasonable prospect, having lived in that area for such a period of time, of transferring to houses with gardens. That is their aim and objective.
This is one of the reasons why I object to the sale of council houses in a place such as Birmingham. I do so on purely humane grounds.
I have been astonished to learn of the number of houses kept void with a view to selling them. I understand that void houses in the Birmingham district cost Birmingham more than £1 million a year in rent. A significant contribution to that is made by the void houses which are kept void for the purpose of selling them. What is more, we all know the fate of empty houses. Quite a few of them are vandalised seriously. That is another cost to the council which is not taken into consideration.
I am told by the local authority that this is a gain to the housing revenue account. I think that point was made by the hon. Member for Hornsey (Mr.
946
Rossi). It is maintained that this will be a panacea, that, instead of putting up rents to the degree to which they can be raised, councils should just flog council houses and that will solve their financial problems.
I make one or two points about that statement. I have gone into the figures myself. First, to some extent, it is correct that part of the burden is shifted from the local authority to the Government. What happens is that the tenant who becomes an owner-occupier and who has never had mortgage relief on his rent will get mortgage relief on the money that he has borrowed. Therefore, the amount of public expenditure is not decreased, because the burden is simply shifted from the local authority to the Exchequer. Also, in the calculation of the gain to the housing revenue account—and I have seen some figures—the figures are based upon the current housing account, and on the current housing account it is quite clear that one can say "This is what it cost us before and this is what it costs the housing revenue account afterwards." But, of course, the housing revenue account changes—for instance, because of inflation.
The Tory council, in 1971–72, also sold several thousand council houses. It sold them then, in many cases—they were mostly pre-war council houses—for £2,000 or sometimes less than £2,000. If we analyse how that affects the housing revenue account today instead of the effect at the time those houses were sold, we find an entirely different picture.
Therefore, first, the housing department has not taken the feature of inflation into consideration. No doubt the housing department will bear in mind that inflation, in housing—certainly over the last few years—has increased at a much steeper rate than the general rate of inflation. Secondly, the local authority has not taken into consideration that it is parting, for good and all, with a valuable and appreciating asset. If the local authority merely takes into consideration the current income and expenditure—what comes in and what goes out of the revenue account—that is nonsense and any private company which operated upon that basis and did not take into consideration the capital loss would obviously find itself eventually, if not immediately, in very difficult circumstances. The councils are

947
losing and parting with a valuable and appreciating asset.
If one weighed up the situation historically over a period, this element of gain, this element of advantage to the housing revenue account, would largely if not entirely disappear.
My major objection to the sale of council houses in places such as Birmingham is not so much the financial aspect as the social aspect. I have already mentioned the people who need houses, especially those in high-rise flats and other undesirable properties and areas, bearing in mind that the sale of houses is confined to the most desirable properties. No flats or maisonettes are sold at present. I understand that there is a scheme for selling some flats, but for all practical purposes that does not exist at present.
The local authority is selling the best part of the housing stock. I do not see how that can be justified. I was surprised when the hon. Member for Henley (Mr. Heseltine) said that this is releasing resources. Of course it does not release resources; that is a load of nonsense. In Birmingham, the housing department lends the money. Therefore, all that happens is that a transaction is recorded in the books of the Birmingham corporation. There is no releasing of resources at all.
It is true that in other authorities the purchaser goes to a building society. In that case he does not get his advance from local authority resources, but at the same time he is diminishing resources from another source—the building society.
Therefore, this idea of releasing resources is a load of sheer nonsense which I can only ascribe to somebody who, frankly, does not understand how housing revenue accounts and these schemes work in the various places where they are operated.
Mr. Arthur Jones: I cannot resist that challenge. The hon. Member for Birmingham, Erdington (Mr. Silverman) knows as well as I that the average life of a mortgage is just under 10 years, and, of course, with housing finance being funded for 60 years, one finds that on average repayments are made on a much shorter term. That is one of the factors to be considered.
Mr. Silverman: The hon. Gentleman says that the average mortgage lasts for 10 years, but obviously the average mortgage is for more than 10 years in the first place—usually 20 years or occasionally more. But I do not think that that invalidates my point. It is quite incorrect to say that the sale of council houses releases resources. That is no argument for it at all.
In conclusion, I am not opposed in principle to the sale of council houses, nor are the Government. I have no words of condemnation for any of the people who have bought council houses. If they were to come to me for advice I would say, frankly, that I do not like the idea of selling council houses but that they should buy them because they are a good buy.
The point is whether it should be done in a place such as Birmingham with its particular problems, not only its housing problems but still more the problems of the different type housing and people who want houses of a particular character. In those circumstances, I think that it is quite wrong. In the present circumstances, the conduct of these sales is becoming a shambles in Birmingham as it is in other places, where there is a sort of pathological urge to get rid of houses at any cost and whatever the consequences. I am bound to say that I cannot condone that in any degree.
5.37 p.m.
Mr. W. Benyon: The political circumstances that pertain today are such that we really cannot take anything that is said from the Labour Benches with any great seriousness. The Secretary of State seems to be rather like Nero at the moment. He is making a lot of noises from the Dispatch Box, but we cannot really take any notice until we have a decision at the polls and until we know just who will govern the country in the future.
The few remarks that I want to make are much more concerned with the policies adopted by my hon. Friends than with the record of the present Government, which is so appalling that it is almost the same as trying to knock over a man with a wooden leg. The enormous sums that have been spent have achieved very little, and much of the money has gone into the wrong pockets. That is

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the problem that will face the Conservative Party when it takes office.
There has been maximum expenditure with the minimum effect. Just two years ago, when the International Monetary Fund produced its strictures on our economy, it appeared that reason was prevailing and that a certain change was being brought about in the housing policies adopted by the present Government—particularly by the Minister for Housing and Construction. But these seem to have suddenly faded away in the last year or so in a sort of stultifying effect of Left-wing dogma and we are back to the same position we were in before. It is a very depressing situation.
I have said to the Minister before, and I say it again, that I would gladly trade a lot of my own cherished solutions to the housing problem if we could get some sort of bipartisan approach in the long term. Housing is so long-term that nothing would benefit the country more than if we could agree on roughly how we should proceed in the long term. By that I mean that we should try to use the four wheels of the coach in order to get rid of substandard housing and overcrowding.
The four wheels of the coach are local authority housing, the voluntary housing movement, the private rented sector and owner-occupation. Unless we can use all these to the full, particularly in those areas to which the Secretary of State paid so much attention—the inner city areas, the areas of housing stress and the deprived areas—we shall not get anywhere near to licking this problem.
The concentration of the Labour Party over the past four years, as it was in its previous periods of office, has been entirely on the municipal sector. It is for that reason that we are falling further and further behind, particularly in those inner city areas where the Labour Party is in power in local government.
There can be no more depressing experience than to tour or talk with the people who run those boroughs. It is as if they regard anything outside municipal housing as something akin to leprosy. One cannot get through to them. This was brought home to me very vividly the other day when I listened to the chairman of one of the inner London boroughs talk about home ownership.
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He agreed that a lot of people wanted to own their own homes, but what worried him was that if they produced houses for sale in his borough, the speculators would move in and those homes would be sold to people from outside. Therefore, he argued, there would be no benefit to those living in the borough.
I suppose that one must be thankful for small mercies, because one would not have heard even that attitude expressed a few years ago. Even so, it was a most depressing situation.
The problem with which we are faced in these inner areas is essentially one of rehabilitation. This is an extremely difficult task to undertake. Each house is different, and each house needs to be dealt with on an individual basis. My hon. Friend the Member for Northampton, South (Mr. Morris) read out the figures for certain London boroughs. What is happening is that the programme of rehabilitation is falling further and further behind.
I cite in evidence the Housing Corporation's programme for the current year. In that paper it states:
" The Corporation notes that, whereas on new build the rate of new tender approvals exceeds that for new loan approvals, indicating that the pipeline of approved schemes is making good progress, the position on rehabilitation is reversed and the backlog of acquired but unimproved houses is growing ".
That is absolutely true, not only in London but also in the inner city areas in the North and the Midlands.
The first priority of an incoming Conservative Government must be to tackle this situation. I remind my hon. Friend the Member for Hornsey (Mr. Rossi) of the great success which Mr. Harold Macmillan had in producing a target for building 300,000 houses a year. That was what was needed in housing at that time. What is now needed is a similar target, which in effect would say that we shall lick this problem in 10 years. We should set ourselves a target of rehabilitating substandard homes over the next 10 years, stick to it and meet it. Nothing could be more relevant to the current housing situation than getting rid of these bad areas and the stress which goes with them. To do so, one needs some legislation. Some things must be changed in law. But, most of all, one needs good administration, the cutting

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out of bottlenecks and the reallocation of resources to where they are really needed. We must also get rid of the situation I mentioned earlier, where this large sum of money goes into the wrong pockets.
I take the four wheels of the coach separately. I take first the private rented sector, because it is the least important. I warmly applaud the proposals of my hon. Friend the Member for Hornsey, which he outlined in an interview the other day. But I do not think that much can be expected from this sector in solving our current problems.
The rundown has already been mentioned, but I believe that it is the political threat of a future Labour Government that will stop any real success being achieved from this sector. In truth, the decision to get this sector moving is not that of my hon. Friend but one which lies with the Labour Government. Anyway, it is worth trying, and if we can get even a few more homes in inner city areas from this sector it will be well worth it.
The second wheel of the coach is the voluntary housing movement. I agree with my hon. Friend the Member for Daventry (Mr. Jones) that the Housing Corporation is doing a good job. It has been successful. But it can be helped even more if we can get an extension of the private capital inflow which has already started and which is being used by the Housing Corporation. We all know how this came about. It was allowed by the present Government in order to replace the shortfall as a result of the cutback in Government expenditure. There is no doubt that ample funds are available in the private market, and these could be tapped and brought into the provision of rehabilitated housing through the Housing Corporation and housing associations.
Home ownership is the most important aspect that needs to be tackled. The Conservative Party must make special arrangements to help buyers of rundown property which is in a very bad condition and which they will take over and put right. This involves grants to first-time buyers of older and cheaper property such as exists in inner city areas.
My hon. Friend the Member for Hornsey has been twitted by the Government Front Bench about his proposals to help first-time buyers. I hope that he will not be discouraged. But this proposal needs
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to be sharpened down a little so that we concentrate our effort on the areas and the people who really need it. It could so easily get out of hand and become an open-ended commitment which benefits people who really do not need it.
Last, but by no means least, I turn to the local authority sector. Perhaps I can turn round a phrase of Lord Butler and say that they are the best local authorities that we have. We must work through them and with them. I hope that my hon. Friend will not make the mistake, which the present Government have made, of trying to force local authorities to do something which they do not want. There is nothing to choose between a Labour Government forcing comprehensive education down the throat of a Conservative council and a Conservative Government trying to force a staunch Labour authority to sell council houses against its wishes.
No one wants to see the sale of council houses more than I do, and no one appreciates more the social advantages that can flow, but it is extremely dangerous to lose sight of the fact that these authorities are elected bodies. Goodness knows why they are elected over and again, especially when we see the mess that they make, but they are. But it is up to the people concerned to change that situation. We would be heading up a blind alley if we ran the same race as the Labour Government have run over the past four years and got ourselves into conflict with local authorities. Unless the whole system is changed, they are the authorities that have to get matters working and improve housing conditions.
I hope that my hon. Friends will think very carefully before making it a statutory requirement for councils to do something that they do not wish to do. There are many other ways of killing this particular cat. Financial inducements can be offered, and a whole gamut of powers is available, from loan sanction downwards, which can assist in bringing pressure to bear on authorities to sell, and offer for sale, houses to their tenants. There is no reason why we should not add to these financial incentives of a greater kind.
It is a scandal that, 30 years after the end of the war, we still have this curse of

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substandard and overcrowded housing. It is not improving. In spite of what the Secretary of State says, the position in some areas is deteriorating. We all know why this has occurred. There is no point in going over it again. We have heard it repeatedly in housing debates. What we need is a new, basic and fresh approach—one which should be short on politics and long on common sense.
5.52 p.m.
Mr. John Sever: I was not in the least surprised to hear the comments of the hon. Member for Henley (Mr. Heseltine) on this issue today. It is plain that there is nothing new in Conservative Party policy for this House to consider. What I was a little surprised to hear—certainly I was very pleased to hear them—were the comments of my right hon. Friend the Secretary of State about those measures which seem to be forthcoming in the new housing Bill, and the contents of the circular, issued today. I am sure that many of my right hon. and hon. Friends will be happy to know of those amendments and will look forward to seeing them being implemented.
My hon. Friend the Member for Birmingham, Erdington (Mr. Silverman) raised some interesting details about the position in one of the biggest municipal authorities in Western Europe. He has a depth of knowledge which is probably not surpassed by any public representative in the city of Birmingham. His speech was in marked contrast to that of the hon. Member to whose speech we have just listened. My hon. Friend the Member for Erdington has a grasp of the subject which the hon. Member—whose constituency I cannot at the moment recall—does not. I would not mind betting that the hon. Member's constituency does not include any inner city area.
Mr. Michael Morris: It is a pity that the hon. Member does not know the constituency of my hon. Friend the Member for Buckingham (Mr. Benyon). Within my hon. Friend's constituency there is the new town of Milton Keynes.
Mr. Sever: I am grateful to the hon. Member. I feel fairly sure that Buckingham does not contain the type of
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areas which my right hon. Friend and his colleagues on the Front Bench are anxious to serve in their capacities as Housing Ministers.
We must try to put forward the arguments for the inner city areas. They are contained neatly in certain passages of the recently published national dwelling and housing survey issued by the Department of the Environment. From that publication we can see that the situation in the United Kingdom has improved dramatically over the past few years. With some degree of modesty, I believe that Conservative Members can take some credit for that improvement over the first few years. In the latter years we have been an input into inner city areas which has been nothing short of dynamic.
I am sure my right hon. Friend will be well aware that at the end of 1977 one in 20 households in the West Midlands had no inside lavatory, while in Birmingham and Sandwell district council areas the proportions were even higher. It is on this, and similar shortcomings, that I wish to dwell, in the sure knowledge that my right hon. Friend will give them his utmost attention and do what he can to effect improvements.
Those of us who live in and represent the inner cities are aware of the overwhelming housing problems which they face. Those of us who try to draw shortcomings to the attention of the authorities are anxious to point out what it is that people living in such areas are looking for. They are obviously looking for an improvement in their standard of housing. They have looked to Labour Administrations in this place and in the local authority areas to bring about those improvements.
I believe that the new housing Bill is one of those measures which, with the benefit of hindsight, will be regarded as having been designed to improve the standard of living of everyone. I welcome the advent of this Bill and hope that many of the measures that we have talked about long and often in the Labour movement will be introduced. In Birmingham there are shortcomings in the improvement of houses in the inner ring areas. It is interesting to note that Birmingham has said in the past few days that the modernisation programme for properties

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in the inner urban areas—those properties for which there are big Government grants—has improved by 33 per cent. in the past two years. Those areas which are designed as partnership areas have found the extra money invaluable and have pumped it into housing. There has been a dramatic increase in the programme.
The shortfall has been in what might be regarded as the traditional area of local authority housing management, the area in which the local authority has spent its own money and directed its own affairs. In Birmingham in past years there were 239 conversions to flats. This is a very popular move in our area. The figure has fallen, in 1978, to 46. To those who wish to see such conversions taking place to facilitate movement in housing, particularly for the elderly and disabled, those figures are a condemnation of mismanagement by local Tory authorities, especially in the big cities.
Finally, I ask my right hon. Friend to visit us in the city of Birmingham at some time. I know that many of the voluntary bodies and other organisations working within the housing sphere would welcome the opportunity of meeting him. I recognise that I could have tabled a question asking him when he next intends to visit our city. However, I am sure that, in the spirit in which I have asked my question today, he will do his best to give me an answer later in the debate.
5.57 p.m.
Mr. Michael Morris: I shall resist the temptation to make a visit to Birmingham, Ladywood and will content myself by reflecting that hon. Members representing Birmingham seats seem to be joining in the chorus that no one in the Labour Party objects to the sale of council houses—except for the hon. Member for Salford, East (Mr. Allaun). However, they do everything in their power to prevent such sales happening. The statement by the Secretary of State this afternoon on the new circular is clear evidence of that. This circular will not be welcomed by the people.
This is probably the last occasion on which we shall have a major housing debate in this Parliament. It is, therefore, instructive to look back over five and a half years of stewardship, particularly that of the Minister for Housing and Con-
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struction I am afraid that the only area that I can find where there has been great success has been in the setting up of working parties. We have had more working parties in the past five and a half years than I can find at any other time since the turn of the century.
Now we are to have this new housing Bill. We have been promised the Bill since the Gracious Speech. The talk in the Smoking Room has been that it was coming any week now. That has been the talk since well before Christmas. Clearly, consultations have gone badly because the right hon. Gentleman got it wrong and had to change a lot of things. Now we are told that the Bill will be here just before Easter. We shall wait and see what further changes are to be made.
Let us look at the overall housing situation. I am surprised that the Secretary of State can be proud of the overall outturn of new buildings. The figures for housing starts are a fairer analysis. In 1973 the figure was 328,500. Last year it was 265,000. The right hon. Gentleman has not given us the forecast for 1979. I believe that we shall be lucky to make 230,000. That may be pessimistic, and perhaps the Minister will give us the forecast. But it is a sad fact that if only we had maintained the rate at which we were producing in 1973, 1 million families would be living in new or improved houses. A million families have been denied that by the Government.
Mr. Stephen Ross: Perhaps the hon. Gentleman could estimate how many of the 300,000 houses built in 1972–73 are now subject to extensive renovation because of damp, roof leaks, bad construction or design.
Mr. Michael Morris: I suspect that the number is relatively small. From the recent analysis in Building Design, it would appear that most of those old buildings were built in the early 1950s and 1960s, and not in the early 1970s.
A key sector is the private builders' home ownership sector. The Secretary of State admitted that under his stewardship mortgage rates had been higher, but he did not say that they had been nearly 2 per cent. higher and have cost the average family an extra £160 a year. Nor

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did he mention that there had been fewer first-time buyers or that the queues for mortgages are longer than ever before. He glossed over that. Yet the Government are interfering in the creation of new homes.
There are two areas where the Government are doing the worst damage. In the early spring of 1978 the Secretary of State instructed building societies to restrict their mortgage lending. The evidence from the building societies and informed opinion is that that did nothing to control house prices. Does the Secretary of State honestly expect us to believe that the building society movement does not know the results of his policy? He does not answer. He knows that the effect of that policy on home prices was nil, but it restricted mortgage lending.
The second area of damage is the lack of land at viable prices. The Secretary of State has said that there is three years' supply of land with planning permission, yet the latest survey from the House-Builders Federation shows that for 61 per cent. of the respondents the primary causes for holding up building are the lack of mortgages and of land. That is not surprising when one sees the results of the Community Land Act. Only 2,400 acres have been purchased in two years, which is hardly a great success. But, comparing that to the 153 acres that have been sold, one can see the nucleus of the problem. One can add to that the county structure plans, which have not been helpful to the house builders or planners. The right hon. Gentleman does a grave disservice to the house builders by not admitting that the primary problems that are restricting the creation of new houses in the private sector are the land policy and mortgage restrictions. The mortgage restrictions are primarily due to the public sector borrowing requirement and competition from the national savings movement.
The second key area is council housing. For a long time there has been a need radically to re-examine the role of council housing. It is wallowing like a large oil tanker going straight for the rocks. Costs are escalating and production is decreasing. Reports to the Government show that to build council houses costs 20 per cent. more than private sec-
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tor houses. The Department of the Environment admits that there are 62,000 hard-to-let rented homes owned by councils. If it is admitting that, one can bet one's bottom dollar that there are 100,000. There are about 10,000 council homes that local authorities wish to demolish. That is a shattering figure. It is high time that we knew exactly how many homes local authorities wish to demolish. The report in Building Design on 5 January 1979 was worrying.
There is at least now some evidence of the number of empty homes. The right hon. Gentleman has denied many times that there is a problem of empty properties. But in the national dwelling and housing survey there is an indication of the scale, and we have all underestimated it. In London there are 132,000 houses empty, the vast majority of which are owned by the local authorities.
The Minister for Housing and Construction (Mr. Reginald Freeson)The Minister for Housing and Construction (Mr. Reginald Freeson) indicated dissent..
Mr. Morris: It is no good the Minister shaking his head. He should examine which boroughs they are and who owns the properties. The London boroughs of Islington, Hackney, Southwark, Lambeth and Tower Hamlets are the culprits. It is all there in black and white. Thankfully, it is not as bad in the rest of the country. Birmingham is not nearly as bad as the Labour-controlled London boroughs. We have about 200,000 houses empty, and the vast majority are in local authority ownership.
Looking at the management of local authority houses, one finds that rebated rents are covering only just over 40 per cent. of the costs. Last year rent arrears rose by 40 per cent., as reported by CIPFA. The debt owed in unpaid rents is nearly £62 million. That is a crisis of local authority council housing management. It is not surprising that the president of the Institute of Housing Managers has called for better training and control of housing officers. Right hon. and hon. Gentlemen on the Government Benches complain of Conservative Members suggesting that council house rents should be increased. But manual earnings have risen by 88 per cent. and rents by only 67 per cent.
The right hon. Gentleman has not yet given his reaction to the report on

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value for money in local authority house-building programmes. That report stated that much of post-war public housing is ineptly planned, badly designed and unnecessarily expensive both in design terms and actions on the land market. The Minister is quoted in the papers as stating in response that this was a new, challenging and constructive report. But we have all known those facts for a long time.
Mr. Freeson: Has the hon. Gentleman read it?
Mr. Morris: Yes, I have read it. If it is so new and constructive, it is surprising that the Minister has not told the House about it.
Although I represent an urban constituency in the East Midlands, I must return to London to deal with the cost of council housing. In 1979–80 £995 million was allocated to London, compared with £2,862 million for England and Wales. In a year, £64 million will go to the London borough of Camden, which is building houses at over £70,000 a unit. Islington is getting £60 million, with a 40 per cent. rate increase and with thousands of empty properties owned by the council. I know that that is a fact because we have checked in that borough. Hackney will get £37 million, with a rate increase of over 50 per cent. to fund that. Southwark, with £55 million, is now so well off that it is able to produce a brand new town hall. Finally, there is Tower Hamlets, in which 74 per cent. of the land is owned by municipal and statutory authorities.
Despite all that, homelessness in London is the worst in the country and is on the increase. The Minister must face the fact that this is caused by the actions of Labour councils municipalising the properties and leaving them empty. The sooner he wakes up to that fact, the sooner we shall begin to solve some of the housing problems.
We had a working party report on direct labour last summer. This was produced with a great flurry at the last minute. I thought that £400 million could be saved in this area, but the report indicates that it could be more. Glasgow loses £3 million a year on its direct labour department. Newcastle has lost £900,000 in three years. About £1 million has been lost on South Tyneside. I could list many
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more examples. Is the Minister not worried about the situation? Should he not take some corrective action? Or will he continue to sit there complacently while millions and millions of pounds are thrown down the drain just to follow some Socialist philosophy?
If the Minister does not like my proposals, why does he not take the CIPFA proposals? That body has done three-quarters of the work for him. At least he should insist on competitive tendering, look hard at this problem and put it right. When will the Minister come clean about the figures in the expenditure White Paper? Last year we were told that subsidies would stabilise at around £1,400 million to £1,500 million at 1977 prices, but now we are told that the future projections for 1982–83, based on a new subsidy system, the details of which we do not know, are likely to come out at £1,828 million. Many of us wonder what the figure would have been had we stuck to the old system.
I wish to comment briefly on the other two wheels of the coach described by my hon. Friend the Member for Buckingham (Mr. Benyon). I am less sanguine than he is about the Housing Corporation. I suggest that any body which delays its final accounts not just once but twice and then tells us indirectly that they contain a £1 million technical error, £1 million on axed schemes and £6 million on abortive costs cannot claim that all is well with its financial accounting. There is now talk of the corporation building for sale. I think that the time has come when the corporation should stand on its own feet and be properly accountable to Parliament and to the people and perform what should be, in theory, a useful role.
The Minister too easily casts aside the usefulness of the private rented sector. For months on end he has refused to admit how many dwellings have been lost because of the 1974 Rent Act. We now know the figures from his own Department—more than 400,000 houses since 1974. This is disclosed in the housing and construction statistics, and if the Minister does not know which table I shall be more than happy to show him.
The survey done by the Office of Population Censuses and Surveys is equally worrying. This survey deals with the attitude towards letting, and it shows

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that 40 per cent. of current landlords have no intention of letting in future if they can possibly get out of it. That is their reaction to the 1974 Act.
The last five and a half years show a very sorry catalogue of catastrophes. We still have more than 2 million homes in an unsatisfactory condition, with a hard core of 1½ million. We still have 50 per cent. of council tenants who are subsidised but who could afford to buy their own homes, or at least pay economic rents. We still have massive municipalisation, more homelessness and massive rate rises. There must be a reaction in the London boroughs. There are thousands of council houses empty and tens of thousands in ruins. Yet all we get is still more and more reports flowing in from working parties but these are never published because the results are totally unpalatable to the Minister. Every one of those working party reports—however doctored, and we all know how many of them have been doctored before presentation—suggests that the Minister's five and a half years in office have seen total failure of the housing market.
6.15 p.m.
Mr. John Ovenden: I listened with interest to the hon. Member for Northampton, South (Mr. Morris) and his hon. Friend the Member for Buckingham (Mr. Benyon) talking about this coach with its four wheels. I was trying to remember the song about the wagon with its wheels which fall off one by one. I am not suggesting that that will happen to the Tory housing coach, but I suggest that the Conservatives should not place too much faith in one of the wheels which appears to be severely buckled and not able to take too much weight. That is the wheel that bears the private rented housing sector.
The more debates that we have on this matter, the more we hear from the Tories that the only role that the private rented housing sector can play is one in which it does not have any obligations. This means a situation in which there is no security of tenure for the people involved, in which the private sector operates in a totally free market providing very short-term accommodation and having the right to throw out tenants and to jack up rents at the least opportunity. Presumably
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that is the only way in which the private rented sector can play any role in the housing market. If that is so, it would be better for us to convert this rather ramshackle four-wheeled coach into a far more efficient tricycle with three dependable wheels. If we do not do so we shall be going back along the road before the 1974 Act, and perhaps before the 1957 Act as well. That means back to the Rachmans of this world and all our previous problems.
There are four major points in the housing debate at present, and we must look at them very seriously. I am sorry that yet again this housing debate has been bedevilled by party political points from the Opposition. This happens on every occasion when we debate the subject and we do not really get down to looking at the basic problems. We must look at the size of the building programme and the level of housing investment. Also, we must look more seriously at the question of the sale of council houses and assess the realities and not the myths of that issue. We must also look at the problems of owner-occupiers and the role of the building societies. Many of us are increasingly dubious about whether the building societies continue to fulfil their original role and whether they are the right vehicle on which to place so much of our housing finance. Perhaps we should consider whether we should place so much dependence on them for the furtherance of owner-occupation. The other area that we must consider is the protection of tenants and the need for continuation of the Rent Act.
Many of us argue not only that the Rent Act must be continued but that it must be tightened in order to do something about the abuses that are taking place. We must tackle more firmly the bed and breakfast racket, the licensing to occupy and leasing rackets, all of which are deliberate manoeuvres to avoid the Rent Act and to deprive tenants of their rights under that Act. Far from talking about lessening the restrictions, we should be making sure that the spirit of the Act is put into force. We must not allow a few racketeers to drive a coach and horses through the Act.
The major issue is the building programme and the level of housing investment. We are facing an extremely

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serious decline, particularly in the public sector of house building. The priority which was given to that sector in 1974, 1975 and 1976 seems to have diminished. The achievements of 1975 and 1976 in local authority housing starts seem to have been allowed to slip away. Public sector housing starts in 1978 were lower than in 1973. That is something about which we should be extremely concerned. Shelter reckons that local authority starts last year were lower than at any time since the war. If that is the position, we should be doubly worried.
The Government's Green Paper on housing set what many of us regarded as extremely modest housing targets. Some of us would regard those targets as inadequate to deal with the real extent of housing need. But present building levels, as measured by housing starts, fall short even of those targets. The targets were in the region of 275,000 houses a year in England and Wales. Present figures show that in 1977 and 1978 the level of starts in the public sector in England and Wales was below 240,000. The estimates given in the Government's Green Paper for the growth of households in this country is 146,000 a year. The estimates given for the demolition of houses for slum clearance and similar purposes is 60,000. It appears that, on the present level of starts, we are contributing fewer than 30,000 above that absolute minimum level and fewer than 30,000 towards the tackling of the overall deficit in housing.
There are two main reasons for the alarming decline in housing starts. The first is the attitude of many Tory councils, encouraged by their leaders. It is not happening so much today, probably because the levels are now down to such a figure that there is no need to encourage councils to cut back. I recall invitations in this House last year and in previous years from the Tory Front Bench to their colleagues in local government to cut back. Throughout those debates it was asserted that the level of council building was too high and needed to be cut back. The Tories in local authorities have responded to those invitations and have imposed savage cuts in house building, even in the stress areas. I regard that as indefensible. It amounts to an abdication of housing responsibility and a cynical disregard for people in
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genuine housing need. It is taking place in areas with the worst housing problems.
It would be wrong, and I would be indulging in the sort of activity I have been attacking, namely, the making of cheap party points, to pretend that that is the sole reason for the decline. It is a major reason, but it is not the sole reason. The unnecessary and damaging restrictions placed on local authority building by Treasury diktat in 1976 dealt a blow at local authority house building from which it has not yet recovered. Some of the responsibility has to be placed there.
There is real evidence that spending on local authority house building was not out of control in 1976, as was suggested by the Treasury at the time. Indeed, there is strong evidence that a decline in building starts was already setting in before the Treasury moved in with those restrictions. The imposition of those restrictions caused an acceleration of the downward trend that had already started and which has now led us to this abysmal low level of housing starts. The freeze that was then imposed on new contracts and the period of tough restrictions which followed for the rest of 1976 contributed to that major decline. We have to face up to that responsibility.
The level of investment in house building overall remains totally inadequate. Until housing is given its rightful place in our economic priorities, we shall be unable adequately to tackle the problems that face us. The level of capital investment in housing last year was about £1,500 million less than in 1974–75. That is an alarming drop. In 1979–80, it is supposed, according to the public expenditure White Paper, to increase by only about £100 million—a woefully inadequate figure. Much of the cutback between 1974–75 and last year centred on local authority mortgages and improvement grants. But there was still a reduction of about £400 million over the last two years in spending on new dwellings and new council building.
That cut must be restored as a matter of priority. It needs to be restored if we are to get back to an adequate level of council house building. It also needs to be restored in terms of general economic policy. Many hon. Members on this side want to see an increase in the level of public spending over the next

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few months if we are to get out of the economic trough into which we have plunged. The restoration of cuts in housing must have high priority. The 4 per cent. increase in housing investment programmes planned for this year must be increased substantially. I hope that this will be one of the major priorities of the Chancellor of the Exchequer when he presents his Budget. I hope that my right hon. Friends in the Department of the Environment will stress on him the urgency of this matter.
The Government's approach to the housing problem should be wider. I have never been convinced by the idea of stress areas. It implies that most areas in the country have no housing problems. That is a totally mistaken and complacent view. The Shelter survey conducted 18 months ago showed clearly that there is still a real housing need in almost every part of this country and in almost every housing authority area. Nothing has changed since that survey. In fact, the level of building that has taken place since that survey probably means that the situation has deteriorated rather than improved in many areas.
In the light of the declining building programme, falling investment in housing, high unemployment in the construction industry and the need for council house building throughout the country, there is a strong case for the lifting of the restrictions currently imposed on house building and for a major increase in investment. I should like to see a return to the system where controls on local authority house building are lifted and local authorities are put back into the position that existed prior to 1976 of deciding their own level of house building.
Such a system would not overtax the economy. Nor would it lead to overheating of the economy and runaway public expenditure. On the contrary, it would make a major contribution to forcing up the level of house building, which has declined to an alarming extent. It would ensure that those authorities wanting to build houses have that opportunity and also provide the opportunity to compensate for those authorities which are turning their backs on their housing responsibilities. Action on those or similar lines is imperative if we are ever to get out
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of this trough into which we have fallen in public sector house building.
I remember my right hon. Friend the Minister for Housing and Construction, describing the figures of council house starts in 1973 in strong and rightly condemnatory terms. It is tragic that we should have fallen back to that figure. We have to do something to get out of that trough and to get our priorities right and increase investment. The housing prospects of thousands of families have been hit hard by the decline in house building.
Those prospects are being further undermined by another aspect of housing policy, namely, the disastrous policy of selling council houses, with which my hon. Friend the Member for Birmingham, Erdington (Mr. Silverman) dealt so well. The policy of selling council houses makes no sense either in economic terms or in terms of housing policy. Already, those local authorities which sold large numbers of houses in the early 1970s have come to appreciate the financial consequences of their actions. Those authorities have found that the loss of rent income has not been compensated by the income from mortgage repayments, mainly because of the low prices they obtained for their houses. The burden of financing that shortfall in income has fallen on the remaining council tenants and the housing revenue account.
It is indefensible that those who are the poorest tenants and are not in a position to buy their houses should have to pick up the tab and pay, through higher rents, for the consequences of selling council houses. If the policies that have been suggested by Conservative Members were implemented, if 30 per cent. discounts were given or councils started giving away houses, as the right hon. Member for Worcester (Mr. Walker) would like, there would be massive escalations in council house rents to fill the gap—and the poorer tenants would pay the price.
But this is not just a financial question: it is a social question as well. As has been said, it is not just the number but the quality of houses sold which counts. It is not the flats and houses on the older estates that are sold, but the newer ones with gardens—those that are desperately needed by families who are sitting in high-rise blocks seeing their chances of a decent

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home wiped out by the irresponsibility of Conservative councils.
We have dithered too long on this. The Government have rightly said time and time again that they are opposed to the sale of council houses in areas of housing need. It is one thing to be opposed to it but quite another to do something about it. The Government have a moral responsibility to act. If they believe that these policies are damaging the housing prospects of those in the weakest position, they should step in to protect them.
I am pleased to hear what my right hon. Friend said about going some way towards removing the consent to the sale of new houses which were originally built for renting but are now being sold off before they can be occupied—not to sitting tenants, because there are no sitting tenants—in a way which does not accord with the general consent granted for the sale of council houses.
I am also glad that my right hon. Friend has acted to prevent some Tory councils from binding the hands of their Labour successors by removing the right to buy an option and thus guarantee the purchase of a council house for all time.
I should have liked my right hon. Friend to go further in a minor respect and get the estate agents out of the council house selling business. It is indefensible that so many estate agents should get rich pickings from the sale of council houses for doing very little work. Those pickings are at the expense of the council tenants who remain. It is the council which pays the estate agents' fees, and in the end the housing revenue account pays them.
Even if one believes in the sale of council houses, there is no justification for bringing in outsiders and allowing them to take these rich pickings when all the necessary staff and expertise already exist in the local authority.
But that is a minor point. The major point is that my right hon. Friend should have gone further today and discussed the withdrawal of the general consent for sale. If we are opposed to the sale of council houses in areas of housing need, we should say so and act accordingly. We ought to say that council houses cannot be sold in those areas where housing need still exists.
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I would define such areas not just as those with waiting lists but also those where young couples still have to live in high-rise blocks because there is insufficient family accommodation. There is no justification for selling houses in those circumstances. The replacement of the general consent with a specific consent based on a proper analysis of the housing position in local authority areas and of their building programmes would be a sensible solution.
However, the Secretary of State has moved some way. We all welcome what he has done. He has taken action to deal with the worst abuses. I hope that that is just a step in the right direction, not his final word, and that there will be a move later towards a system which recognises the Government's responsibilities in this respect.
The problems of owner-occupiers are often portrayed by Conservative Members as though they spring from a lack of houses to buy. That is why we have to sell council houses, they say—to boost the supply. But I have never found that that is the major grievance of owner-occupiers. Their major grievance is the mortgage system, the building society system. There is a great deal of resentment among owner-occupiers, who suspect that they do not receive fair treatment from building societies.
We should look into the system. In a question to the Prime Minister some months ago I suggested the setting up of a Royal Commission to examine housing finance and to decide whether building societies were the right instruments to use. If we cannot have a Royal Commission, could we not have a departmental inquiry?
We suffer in this area from decisions which do not always seem justified, decisions which are bitterly resented by many owner-occupiers. For example, the speed with which building societies raise their interest rates in response to general movements in the market and the slowness with which they reduce them has prompted one of my hon. Friends to suggest that a special law of gravity applies to building societies.
That is an issue that we should investigate. We should know whether owner-occupiers are getting a fair deal, whether the societies need to respond quite as

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rapidly as they do to increases in interest rates, whether they are as vulnerable to the market as they sometimes pretend and whether their source of finance may not be as rapidly affected by interest rate changes as they make out. We should also consider whether we need so many building societies.
There are so many unanswered questions over housing finance. For example, when it comes to interest rates, we all know that the societies enjoyed a substantial reduction in their tax bill last year because of adjustments in rates and allowances by the Chancellor and the unwelcome help in that direction of Opposition Members. I have not noticed that reflected in the level of interest rates that the societies pay or charge. The gap between the lending rate and the borrowing rate has not been narrowed.
Some societies outside the Building Societies Association charge lower rates. Are they more efficient or is there another reason? If some societies can do that, why cannot others?
Increasingly, owner-occupiers ask themselves why there need to be so many building societies, why each building society needs a smart new office in every High Street. Does this not contribute, they wonder, to the increase in interest rates? Does it not put an unnecessary burden on owner-occupiers?
It certainly puts a burden on those new buyers who must tramp from building society to building society seeking a loan and being turned down time after time, finally finding what they want at another society's office after having paid out large sums in surveyors' fees before they discover that that society does not lend money on that type of house. Different societies have different policies about the houses they will lend money on, but those policies are never published and are not widely known. Many young couples have lost a great deal of money in suveyors' fees by going to the wrong building society.
Could we not have a centralised system? Do we need so many building societies, so many offices? Do we need to waste so much money in the administration of the mortgage system? I am not suggesting that there are easy answers here, but we need to consider this
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system by means of a departmental inquiry or a Royal Commission.
I shall not repeat what I have said already about the need for tighter enforcement of the Rent Acts—not only in their continuation but in closing all the loopholes. There is a strong case for that approach. There is one area in which drastic action is required to protect occupiers. I refer to mobile homes, which need to be brought within the Rent Acts. The Mobile Homes Act, introduced by the hon. Member for Bridgwater (Mr. King) and supported by the Government, was well intentioned. However, that legislation has failed to provide proper protection for residents of mobile homes. It has not given them the security of tenure which they need and deserve, and it has failed to give them the right to sell their homes on site at reasonable prices.
Many residents have been deprived of the rights set out in that legislation because their landlords as site owners demanded extortionately high rents to persuade them to enter into a new lease. Residents have been offered the chance to continue with the present situation at the old rent, thus enjoying no rights at all, or to have the rights conferred upon them by the new legislation provided that they are prepared to pay a high price. The majority of such residents have decided not to do so, and indeed are in no financial position to enter into such a commitment. It is wrong that people should have to buy the rights which Parliament intended them to have but that is what is now happening.
Because of such abuses the Government set up a mobile homes review body. I commend that action and welcome the recommendations made by that body. However, it reported 18 months ago and we are still awaiting action on its recommendations. I wrote to the Department on this matter in September 1977, soon after the report was published, asking for information about what was to happen. I was told that it would be realistic to expect the process of consultation to take some time if the Government were to be expected to produce measures that were thoroughly thought out.
I wrote again in October 1978, 13 months later, asking what was happening to the proposals of the mobile homes

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review body. I was told that the Department was
" working on the preparation of legislation but, given that further consultation with interested parties will be necessary before specific proposals could be formulated, legislation in the coming session seems unlikely ".
Therefore, we have waited 18 months and there has still been no legislation. The review body conducted an exhaustive study into the problem and presented some valuable recommendations. There was plenty of time for the interested parties to put their views at the review stage. However, that should not be used as a further reason for delay.
I hope that the Government will re-examine the position and that when a new housing Bill is laid before the House—whenever that will be—this area will be the subject of action. If no action is taken, we should at least have a Government statement in the next few months so that we know their policy on mobile homes and what they intend to do to protect those who are now excluded from any legal protection at all.
Those who live in mobile homes are a very small group, but they deserve some consideration. I believe that it is important to mention that group in this debate so that the Government can be aware of the fact that there are some of us in this House who feel strongly on this issue. We believe that the Government should be taking their responsibilities in this respect a little more seriously and urgently than has happened up to now.
6.44 p.m.
Mr. Stephen Ross: I did not agree with many of the remarks of the hon. Member for Gravesend (Mr. Ovenden), particularly concerning the building societies. However, I very much agree with him on the subject of mobile homes. I am glad that he mentioned that subject, because I believe that it is time that the House had before it legislation on that topic. A large number of my constituents have been waiting anxiously for Government action. I was delighted to be a sponsor of the Mobile Homes Act, but it was only an interim measure and has not worked out as well as was originally expected because ways have been found to get round many of its provisions.
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I wish to plead with the House to leave the building societies alone, because they actually work. We certainly do not want any more Royal Commissions. Indeed, competition is already appearing because the banks are entering the mortgage field. The National Westminster Bank has just announced a profit of £297 million and Barclays £350 million. Both those banks could grant mortgages. However, let us give building societies their due, because they provide a very good service. For example, let us remember that their offices open on Saturday mornings—a service which the banks are not providing. People can deposit their cash with building societies at the weekends.
If the hon. Gentleman knows of people who have paid out money for surveys in respect of properties on which they have not been granted loans, I believe that they must have been misled by somebody in the office. I am sure that the majority of building societies would make a refund if clients had been wrongly advised. If the form has been correctly filled in and the date of the construction of the house and all the rest of it has been accurately supplied, such mistakes should not occur.
The fees charged by building societies for valuing properties are not high, and indeed are on a very low scale. I appreciate that inflation has taken over since I used to undertake surveys. We used to be paid £5 for the first £2,000, and the scale went up in very small stages after that. Therefore, the fees are not excessive.
Mr. Ovenden: May I put the record straight? I did not say that the fees were excessive. I said that they were a burden on people if they had to be incurred more than once.
Mr. Ross: I agree that if people pay for structural surveys and building society surveys and then find that they are gazumped, such money is wasted. If we were to deal with that situation, we would be getting somewhere.
I wish to deal with the cases where municipal authorities employ outside estate agents. I make no apologies for estate agents, but I know that local authorities which have tried to enter the business of estate agency have been most unsuccessful. Southampton is a case in point. There does not seem to be the

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same drive among employees within local authorities who are employed in selling properties as there is when outside operators are brought in. That is why even Labour-controlled authorities eventually decide to get on with the job and to bring in somebody who knows how to cope.
If the hon. Member for Northampton, South (Mr. Morris) wants to find empty houses, I suggest that for starters he should go to Redbridge, which is Conservative-controlled. I believe that in some parts of the country housing is now in surplus. With the drop in the birth rate in the last eight or nine years, surely we shall now have a chance to deal with our housing problems once and for all.
I wish to echo the pleas of the hon. Member for Buckingham (Mr. Benyon). I found his remarks most interesting, and I very much support his arguments. Let us try to approach our housing problems with more common sense and less party bias. I thought that when the hon. Gentleman spoke of the Minister for Housing and Construction having a sensible spell about 18 months ago he should have mentioned the Lib-Lab pact, but perhaps I should let that matter pass. The hon. Gentleman also suggested that too much money had gone into the wrong pockets. That has long been the case and it also happened under Conservative Governments. Many who have made great pickings out of the miseries of the property world are now residing in the South of France and elsewhere telling everybody that this country has gone to the dogs. I do not have much time for such people.
The hon. Member for Birmingham, Erdington (Mr. Silverman) referred to valuation problems. As one who has practised in this area, I know of the nightmares of valuing properties in a period of inflation. It is almost impossible in some cases to value a property even from month to month. This certainly was the case in 1972–73, and has happened in the last year. One constantly finds that one is out of date in such valuations because a sale suddenly takes place which "ups" prices elsewhere. The hon. Member for Norfolk, South-West (Mr. Hawkins) will agree that this is certainly true of land prices. One estimates farmland prices at £400 or £500 an acre and sud-
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denly finds that some land is going for as much as £1,000 or even £2,000 an acre. The whole market can go haywire in that way, and I suspect that such a spiral happened in Birmingham.
The hon. Member for Henley (Mr. Heseltine) mentioned the rise in prices under the Labour Government. I remind him that in 1972–73 prices doubled. However, I want to be pleasant to the hon. Gentleman because he said some nice things recently about the Housing (Homeless Persons) Act. I understand that the chairman of my local Conservative Party wishes to have that legislation abolished. I was pleased that the hon. Gentleman wrote that that legislation had a substantial amount of all-party support. Support was certainly given to me by the hon. Member for Hornsey (Mr. Rossi), and I wish to put that on record. I am glad that it is here to stay. I agree that it probably does not go far enough. We would all like it to deal with single homeless people and others, but it is on the statute book and I hope that it will stay there.
I believe that in our housing policies flexibility should be the order of the day. We talk about letting, owner-occupation, self-build, local authority building for sale and housing associations. These associations, with all their problems and despite their faults, are playing a marvellous role in many parts of the country by housing people that local authorities will not house. The Portsmouth housing association is even dealing with mentally handicapped people. Often such associations take more than 50 per cent. of people out of the housing lists.
No doubt the administration of some associations needs to be investigated, but the majority of those which are registered—and I declare an interest because I am a member of one—are playing a very important role. Many members of housing associations put in an enormous amount of time and charge no fee. I have an especial regard for a builder in my constituency whom I brought in at the founding of the Isle of Wight housing association who has never had one half-penny out of the association. He constantly checks contracts with other builders, but he has made absolutely nothing for himself. He has done a sterling job.

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We have had a plethora of discussion documents from the Department of the Environment recently. Most of us agree that they are fairly non-controversial and most of us will welcome the Bill when it finally appears. I join the hon. Member for Henley in condemning the Government for not having the courage to bring out their review of the Rent Acts. We should have had that review a year ago, but it now seems that we are not to have it in this Session.
I want to deal with six sectors. First, I turn to the problems facing long leaseholders. If local authorities are to enter this field in future and sell off flats with long leases, we shall need fresh legislation. Some people will fall into terrible traps and I am sure that Members on both sides of the House have increasing numbers of constituents, particularly elderly people, who have bought a flat on a long lease, possibly of 100 or 125 years, who find themselves suddenly faced with fantastic charges for maintenance, repairs and so on. In many cases these are structural repairs which one would have thought were the responsibility of the free-holder.
I have a case before me which is quite mild in comparison to some. A small block of flats was renovated, and the gentleman concerned did very well indeed out of it because he obtained all sorts of improvement grants. I do not deny him the right to those grants, but he made a lot of money out of the venture. In 1977 the repairs bills charged to the long leaseholders of these flats was £300. In 1978 the bill suddenly shot up to £2,535. That money was spent on structural repairs and damp-proofing to two of the flats which were sold earlier. I do not understand why the leaseholders had to contribute to the cost of those repairs. Other people have mentioned even bigger increases. There is the instance of the outside decoration of a block of flats half of which are on long leaseholds and the remainder on monthly or quarterly tenancies.
I was recently offered a flat in a property not far from here. I could not afford it and I am now feeling relieved that I could not. I suspect that the Financial Secretary, the Opposition spokesman for transport and a few others who did buy their properties may well be faced with
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similar bills. Perhaps then we might get some action. One wonders what the Government are planning to do about this problem. The Minister for Housing and Construction indicated some months ago that he was looking at the situation and hoping to introduce legislation. I hope that it will be in the forthcoming Bill.
My second point concerns the continuing saga of unnecessary demolition by local councils. This does not concern one particular council. Both Labour-controlled and Tory-controlled councils are involved. In our present economic situation we surely should put all our resources to full use. The matter of demolition is a national scandal in some parts of the country and demands action from the Government. The Secretary of State said something on this subject.
I spent two days in the Liverpool Birkenhead region. I do not want to talk about other Members' constituencies, but taxpayers' money is at stake. In Birkenhead there is a six-storey block of maisonettes—and these seem to be the ones which are causing the problems—called Oak and Eldon Gardens. The local authority has resolved that they must be blown up. They are all empty and it was certainly right and proper to get children and families out of these blocks. I have had representations from community institutions, including the Methodists, the Church of England and the Roman Catholics, who are anxious because they feel that the block could be renovated and perhaps sold to a housing association. I am sure that better use could be made of it and demolition avoided.
I do not see very much difference between the building I have mentioned and the block of flats in which I live. The Birkenhead maisonettes may be a little vandalised, but if they were done up they could be sold at £3,000 or £4,000 a time to young married couples or single people. I should think that if that were done there would be a queue for them. It will cost £500,000 to blow them up and on top of that are the loan charges. The Secretary of State said that in some cases such charges might be reduced or even cancelled. One finds the same thing in Liverpool with "The Piggeries." It will cost £750,000 to blow up the buildings and a further £60,000 a year in charges. That is why that authority is trying to find a private purchaser for them.

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This situation is a memorial to a period which was presided over by the right hon. Member for Leeds, North-East (Sir K. Joseph). It was a period when I think we all made terrible mistakes in the cause of urban renewal. However, I am not convinced that all these blocks of flats must come down. I think it would be proper for the Department of the Environment to institute careful investigations before it sanctions, as I suppose it must, such demolitions. Perhaps I can get some guidance on this matter later.
I am horrified at what is going on in certain parts of the country. In Portsmouth and in Redbridge, Ilford, for example, there are hundreds of houses standing empty. These schemes are still awaiting the results of public inquiries. We should have some legislation to cover demolition taking place before plans are finally approved.
The homeless situation is helped when housing associations make use of these properties for short-life accommodation. It is a tragedy that such action has not yet got off the ground. It has begun in a limited way, but in Cumberland Road, Portsmouth, Ilford, or even Southwark there are some very good houses, some of them recently re-roofed, standing empty. This is an absolute scandal.
My third point concerns the Rent Acts. I was disappointed with the view of the Opposition because, although I am not seeking to change security of tenure, I thought that the Opposition could have gone further than talking only about the shorthold scheme. There are parts of this country where housing is near enough in surplus to allow furnished lettings to take place entirely free of control.
I agree that the definition of what is furnished must be tied up. The accommodation must be properly furnished. I do not want to see someone letting furnished accommodation which consists of a couple of beds and an odd chair. I am prepared to leave this in the hands of the local authorities. If a local authority can convince the Department of the Environment that it has a very small housing waiting list, it should be allowed to let furnished property. There would have to be a guarantee that controls would not be reintroduced. But the Secretary of State should start such a scheme.
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I do not understand why legislation must apply throughout the United Kingdom. I am not suggesting that such a scheme should operate in London. I accept that in London it might be abused. But in my constituency and in many other parts of the country it would be of enormous assistance to local authorities, social workers and others who wish to help with the housing situation.
I agree with the Government's policy on the sale of council houses. We elect local authority representatives. If a Labour-controlled council does not wish to sell council houses, those who disagree have the opportunity to change that council. Some Conservative-controlled councils do not wish to sell council houses. The New Forest area is represented by such a council, as is my constituency. That is because the amount of local authority property is only about 11 per cent. or 12 per cent. of the total housing.
The New Forest area is an area of high prices and therefore those who earn low wages have to go to the local authority for housing. It would be wrong to force councils to sell their houses in such circumstances. Policy should be left to the local authorities to decide. I hope that local councils will not be forced to sell when their housing provision is small.
My fourth argument involves leases. Why do we not operate a leasing system? Many tenants of council houses want to have more say in the running of their affairs. They complain to us about the need to have gates and fences repaired. Why do not we give such tenants a five-or seven-year lease at a fixed rent? Then they could take over responsibility for maintenance. That would give tenants a stake in the equity. They would not have to find a capital sum. If they wanted to move and received a premium on their lease, I would say good luck to them. One could guarantee the renewal of lease to give them security of tenure.
I am all for co-operatives, but in many cases they do not work. When people are in desperate straits, leaders emerge and co-operatives will work. But I asked a tenant in my constituency why he did not form a tenants' co-operative or a street management scheme. He said that he would not be able to get on with the people across the road. It is a matter of human relations. Let us give tenants

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their individuality by granting them a lease.
My fifth point concerns standards of construction and design. The hon. Member for Northampton, South admitted that we have made many mistakes. Alarming mistakes have been made which have caused rising damp, and so on. What are the Government doing, and what are the Opposition thinking of doing, to ensure that in future houses are well built and designed? I am afraid that we shall repeat some of the mistakes. What is the future role of the Agrément Board which tests new materials? That board plays a vital role. I hope that its role will not be diminished.
What is the role of the NHBC? Is it to be extended? Should it take over more responsibility for the inspection of properties? What are we doing about training young people entering the building industry? What are we doing to ensure that the skills of those who are disappearing are passed on?
There are too many subcontractors and too few all-purpose builders. They seem to have gone to the wall in the last few years because they have had a rough time. Subcontractors do not pass on their skills. We must face that problem and we must try to get the all-purpose builder off the ground again. We must ensure that the new entrants to the industry know what they are doing. There were too many cowboys in the game in the early 1970s. If we are not careful, they will be back again. The person who invents a water closet which does not overflow should be given a gold medal from the Department of the Environment. One sees many such pipes overflowing in blocks of flats and it costs £7 or £8 to pay a plumber to put it right.
I support the concept of the housing tribunal. I believe that this matter is being considered seriously in Government circles and there is a chance that it will be written into the new Bill. Most of us think that such a structure should take over from the present courts and rent tribunals and that it will cover a wide spectrum.
This is probably the last speech that I shall make on housing in this House, and I am glad to put my following comments on the record. I suspect that if there is a change of Government—
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and I think that there will be—the incomers will abolish the Community Land Act. They would probably be right to do that. I wish to see regional land boards. The new Government will also reduce the rate of development land tax. But that will lead to another increase in land prices and profiteering. I do not want that to happen.
I suggest that, instead of doing that, the incoming Government should consider putting a site value tax on all land which is ripe for development. I know that the present Government will not do that, but it seems to me to be common sense. Once planning permission has been granted, the council should impose a charge and make the owner of the land put his land on the market. Such a system would keep out the middle man and eventually the development land tax could be phased out. I am sure that that is the way in which we should deal with the land problem. If I am not able to achieve office, and I agree that that is most likely, I hope to God that somebody will see sense in such a proposal.
7.8 p.m.
Mr. Paul Hawkins: I declare an interest as a chartered surveyor. Since I was a one-man band about 30 years ago I have not sold a house, but I have been into many in my constituency because of my job.
I shall spend most of the time speaking about housing improvement and housing improvement grants in rural areas. Several hon. Members did not carry out their promises not to go back over the record of the parties. That does not do any good. It does not produce new or better homes, which is what we want to do.
Before turning to my main theme, I wish to mention the valuation problem with which the hon. Member for Isle of Wight (Mr. Ross) has already dealt. Some of the comments by Labour Members about the building societies were ridiculous. The building societies represent one of the best arrangements that we have. I do not know whether they exist on the Continent. We have a unique system. The building societies are open for more hours than the banks and they provide an enormously good service.
The valuation problem arises often. It concerns people who feel aggrieved when a neighbour in another street is allowed

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to buy a house at £6,000 and they are asked to pay £7,000. As the hon. Member for Isle of Wight said, values change almost overnight, and they change easily in six months.
People often make the mistake of looking at only the outside of a house. They say "That is just like my house", They have never been inside the house. They do not know whether it has a WC inside or in the garden. They do not know whether it has a good bath or one which was put in in Victorian times. It is the interior decoration, the state of repair, whether it is very damp, the size of the garden, and so on, which can make a difference of £1,000 or £2,000 in the price of a house. I think that we should put on record that one looks not only at the outside but at the inside of a house for valuation purposes.
I am pleased that the Secretary of State is concerned to make it easier for tenants to move. That aspect is an absolute bugbear of the council house system. When we had rural district and urban district councils it was almost impossible to get a man to move over the boundary from one village to another. Today people want to move long distances. When firms move across the country to set up elsewhere, they want their skilled men to move with them. If council houses are not available and it is not possible for people to move or to exchange houses, employment prospects and the setting up of industry are hampered. Therefore, I shall be very pleased if the Secretary of State is able to bring about easier movement for tenants.
I agree that many council house estates, even in the countryside, lack general amenities—nicely cut grass, a few trees or a few rose bushes. They need something to make them attractive and pleasant areas in which to live.
I have always maintained that we need a new name for council houses, because they have a bad name. I have not yet thought of a good one, but I am sure that the ingenuity of the Department will be able to think up a really good name. We could call them British houses or even English, Scottish and Welsh houses if we wanted a measure of devolution without the real thing.
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I deplore the Secretary of State's new circular about the sale of council houses. No Government supporter yet seems to have mentioned why council houses are sold at all. The reason is that people want to buy them. Many tenants who have lived in their houses for possibly 3, 5, 10 or 15 years and paid rates and rents throughout that time now want the opportunity to buy those houses. In many instances repairs have not been carried out because, with the best will in the world, district councils today have enormous problems and therefore are not able to keep abreast of the repair problem with the rents which come in. If the Secretary of State stops the sale of empty houses, I believe that he will do a bad thing. In certain districts there are empty council houses in which no one wants to live because they are in remote rural areas where there used to be large numbers of farm workers. Now, instead of employing four men per 100 acres, a farmer will employ one man per 400 acres. Therefore, the houses are not needed in those remote areas. But some people like to come from the towns to remote areas. Those houses could be sold to those people to provide homes for them.
My personal involvement in housing began when I spent four years trying to get a licence to build a house. That was in the housing ministership days of Mr. Aneurin Bevan. Most hon. Members here now have probably never heard of a licence to build a house. But at one time one had to get a licence which kept one to a certain number of cubic feet, according to the size of the family, and which allowed one to buy only a certain amount of timber, and there was a set price on the house that one wanted to build.
The trouble was that I had a very good architect—he has become one of the most famous in the country. Up to that time he had built only for the Distillers Company. The Distillers Company had a great deal of money and he thought that I had a lot of money, or he did not know very much about prices in those days. I did not even get the roof on before I had to get another licence. I have taken a great deal of interest in housing since those days.
Under Mr. Bevan's housing ministership we had the withdrawal of the rural

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housing improvement grants which had been in operation since before the war. They provided for the improvement of many houses in rural areas—houses occupied by farm workers and people on small incomes. The grants were withdrawn because it was said that money was being paid to landlords who should be able to carry out the improvements themselves. After about four or five years those improvement grants were restored, but in the intervening period a large number of houses fell into considerable disrepair.
My main purpose is to draw attention to the large number of houses still to be improved in rural areas—at least in areas covered by the two district councils which between them cover my constituency. They also cover the constituencies of my hon. Friends the Members for Norfolk, North-West (Mr. Brocklebank-Fowler) and Norfolk, South (Mr. MacGregor).
Some years ago I took part in another housing debate, in the course of which I said that slums, which were obviously worse in towns, also existed in country districts and that there were unimproved houses in almost every village in my constituency. That brought down on my head the wrath of my very good friends on the district councils, who could not believe that they had houses which were unimproved. But they had a survey carried out and found that hundreds of council houses were without bathrooms, lavatories, hot and cold water and many other amenities which we take for granted today. I think that by the end of last year all council houses in my area had been improved up to the five-point standard. However, when I spoke previously, hundreds of council houses in my constituency had very few amenities.
The picture regarding privately owned houses in these two council areas is dismal. The West Norfolk district council estimates that 27½per cent. of the total of privately owned houses in its area are without some basic amenities. In fact, 9,554 houses are not up to basic amenity standards. Of that number, 1,500 are estimated to be totally unfit for human habitation. Yet grant approvals are running at only 200 per annum. Indeed, they are declining. In 1976 there were 236 grant approvals. In 1977 the figure was 209, and on 31 October 1978 it had dropped to 183. The Breckland district council states that it has not
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carried out a detailed survey of privately owned properties but on out-of-date figures it estimates that it has 7,800 houses lacking in basic amenities. It states that it does not know how many of those houses are without electricity.
Having obtained the figures, I asked the councils why they thought that the grants were not being taken up in larger numbers. The grants have been increased, although they have not kept pace with inflation, but there are other reasons why they have not been taken up. I received a reply from the chief executive of West Norfolk district council. In his letter of 31 January 1979 he wrote:
" The availability of grants has been made known to all Parish Councils, all offices have display material, exhibitions have been mounted…Despite the TV commercial I am not of the opinion that this has produced any increase in the number of applications received…The number of grants in fact being handled has shown a slight decline despite the fact that the grant available has been increased…If more finances were made available to enable us to follow up our housing survey the statistics would be more accurate and also it would provide an opportunity to explain to the various occupiers "—
he means as he goes around the houses—
" as to what grants are available."
I should like to press the Minister to make more money available for surveys that enable people to be informed on the spot what money is available in grants and to provide them with the forms and with help. That would increase the number of grants and improvements made to houses in these areas. The writer continued:
" Many old people just cannot be bothered to have their houses improved, they cannot face the upheaval ".
That is a reasonable understanding of a problem that we cannot do much to put right. The letter went on to say:
" The financial return to a landlord is not particularly attractive and this is why the number of applications received in respect of rented accommodation is not very high."
The chief executive officer says that there is no shortage of builders in the area. I endorse that opinion. We are fortunate in having many smaller builders who take on this type of work. He continued:
" The grant conditions in part seem to be in the form of a sledge-hammer to crack a nut, i.e.: an applicant must not be related to the occupant where the application is accompanied by a certificate of availability for letting. Representations have been made to the

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Department of the Environment that the conditions be altered to allow grants where the application is accompanied by a certificate of availability for letting, provided the property will be the occupant's only, or main residence. This would allow parents to assist their children…From my own experience it would seem that persons are reluctant to apply for Local Authority Renovation Grants because they feel that the associated repair works are too prohibitive, mainly for cost reasons. What is needed, in my opinion, is more help towards repair work, or perhaps a change in attitudes towards the high standards of repairs that some Local Authorities demand when they offer renovation grant monies to applicants."
Some of his points are worth examining. It is deplorable that in a council area with 9,800 substandard houses only 200 grants have been applied for annually in the past three years, despite the council going out of its way to seek to convince people that they should apply for housing grants.
I believe that the Government pay lip-service to the improvement of private houses, like so many other things in the private sector. I hope that I am wrong in that belief and that we shall see greater improvements carried out. The rents permitted are not sufficient, the red tape put in the way is strangling and there is not enough money to tempt people to apply. The result is considerable misery and unhappiness for many families when, with more common sense and ingenuity, we could have saved the building of thousands of council houses, thereby saving the country thousands of millions of pounds of capital and interest in building and letting at a loss.
Thousands of houses in my constituency have been allowed to fall down. With proper renovation grants, they could have been good enough today for people to live in. I hope that a Conservative Government, when they come into office, will have a different outlook. I am sorry that my hon. Friend the Member for Hornsey (Mr. Rossi) is not present. He and I used to discuss this matter a great deal between 1970 and 1974. I shall be non-partisan and say that we were not happy with our own housing progress at that time. I know that he intends to make a number of major improvements, and I wish him luck. However, I urge him not to forget that improving houses is important and is cheaper than building new ones and that there are problems in rural areas as well as in urban areas, and,
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finally, I make a plea that he will not build new towns and large housing estates on the best agricultural land.
7.26 p.m.
Mr. Geoffrey Lofthouse: I have recently been actively involved in local authority work as the chairman of a housing authority. I share the intention of the hon. Member for Norfolk, South-West (Mr. Hawkins) to refrain from making political points. I regret that the hon. Member for Henley (Mr. Heseltine) is not present because I believe that my opening remarks will kill his suggestion that all local authorities are being held up with their house building programmes because of the Government's policies.
I should like to make clear that local authorities must carry the blame in some parts of the country for their miserable housing performances. However, I am proud of the achievements of my own authority. The housing investment programme allocation to my authority in 1978·79 was £15·7 million. The allocation was not received until 24 May 1978, two months after the beginning of the financial year. During the course of the year we received a supplementary allocation of £1·5 million. Further to that, we have anticipated spending the 10 per cent. tolerance. Therefore, that provides a total expenditure of £18·7 million—a 20 per cent. increase on the basic allocation. I understand that further moneys would be available if we were able to spend them.
Surely that kills the suggestion of the hon. Member for Henley that all local authorities have failed to achieve their housing targets because of the Government's policies. More than sufficient money has been made available to meet our programme this year. However, there was the difficulty that we did not receive our firm allocation until after the start of the financial year. That problem will not exist this year because a firm allocation has been made for the year 1979–80. I understand also that guidelines have been set for the next three years.
The experience of Wakefield shows that an authority which is geared up to a large programme, with a political will to implement it, can make good progress. The onus should be on the local authorities and not on the Government

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to produce the goods. Local authorities should have schemes prepared well in advance and ready to implement. That demands a corporate development team with a planning function. It might help if local authorities adopted the proposals contained in the development management working group's report. Local authorities should also plan to overspend each year since schemes have a habit of slipping, and by allowing for that targets might be met. Local authorities should have a well-prepared, comprehensive housing strategy, with a five-year plan ensuring that political commitment and resources are tied together. That policy has been adopted by my authority and our success has undoubtedly arisen out of that. The number of dwellings completed in my authority's area in 1976·77 was 344. That figure has been quadrupled to 1,400 in the current financial year.
It is regrettable that authorities controlled by Conservatives have failed, for what I am sure is lack of political commitment, to achieve anything like that result. I emphasise that I am not making a political point. It is factual. The vast majority of local authorities that have failed to meet their targets—when allocations and resources have been available for them to do so—are Conservative-controlled. I understand that authorities are millions of pounds underspent in their housing investment programmes and that an additional 20,000 houses could have been built this year if authorities had spent the allocations made available by the Government.
I should like to draw attention to the conflict between district and county councils. I agree that there is a need to produce structure plans and to have agreement between the two authorities, but districts must determine their housing needs and not be constrained by county councils which have no executive function in housing and have different ideas of needs.
In West Yorkshire, for example, the county structure plan suggests not only how many houses should be built but where they should be built and where houses should be improved. It is the district council's responsibility to determine priorities, and the division of responsibilities should be made clear.
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I have criticised some local authorities for their recent housing performance, but I should like to offer constructive criticism and a contribution towards the formulation of policy in the forthcoming housing Bill. I draw attention to five issues that are worthy of particular emphasis.
First, the housing investment programme procedure introduced in 1978–79 was intended to give local authorities more freedom to determine their own priorities according to local circumstances. There is little evidence to suggest that controls over individual projects, such as the cost yardstick and cost limits for improvement work, have been relaxed substantially. These are still preventing local authorities from spending according to their own priorities.
Furthermore, the method of distributing resources to local authorities under the housing investment programme system is so constrained by controls that it impairs the ability of authorities to carry out their work. In particular, block II expenditure on improvement grants and lending to private persons is more heavily restricted, when compared with local authority bids, than are other blocks. I argue for individual project controls to be withdrawn, leaving the housing investment programme allocation as the method of controlling expenditure.
Secondly, allocations should be made in one block to allow authorities to make the best use of their resources. I believe that authorities should have the responsibility to decide what to do with their own resources and should not be subject to instructions from central Government on how that should be done.
A system of annual allocations can work satisfactorily in relation to capital spending programmes only if sufficient flexibility is permitted to allow for unforeseen changes in spending patterns. This winter the expectations of local authorities have suffered considerably from the effects of adverse weather conditions and industrial action. As a result they are likely to underspend on their allocation in excess of the 10 per cent. allowed under the tolerance arrangements. Special provisions should be made to allow authorities to carry forward more than 10 per cent. of the "1978–79 allocation into the 1979–80 programme.

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Thirdly, I am concerned about the overall level of house building. The substantial decline in public sector construction has not been offset, as was expected, by a corresponding increase in private sector activity. Indeed, the latter, dependent as it is on building society finance and the movement in interest rates, is giving rise to considerable concern.
Local authorities can do much to promote home ownership by building for sale, making land available to private builders, sponsoring housing developments with the private sector and encouraging equity sharing schemes. I suggest that the public expenditure implications of such schemes are minimal.
Fourthly, recent years have seen a serious decline in both clearance and improvement activity, with the result that the older housing stock is suffering increasingly from disrepair. Government proposals for remedying the situation are inadequate and, in certain respects, would be counter-productive. What is needed is a set of bold new measures that recognise the scale of investment that is required if the older housing stock is to be upgraded.
I argue particularly for the amalgamation of housing action areas and general improvement areas, the introduction of fabric repair grants on a block-by-block basis and 75 per cent. grants for all dwellings lacking the basic amenities. I also urge the extension of the repairs grants to all properties, full recognition of the importance of repair work involved in improvement grant expenditure and the immediate revision and regular updating of expenditure limits on grant assessments.
Finally, the building societies' support scheme has not been successful, and new, more vigorous schemes are needed. Local authorities could, for example, take funds on a block basis from building societies and lend them to people who do not qualify for building society finance. The Department of the Environment should take a closer look at building societies to discover whether they are too cautious in their lending policies, too critical of the status of applicants and too reluctant to lend in twilight areas, or invest too much of the investors' money in new offices which are often built only a stone's throw
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away from other building society offices, creating needless and wasteful competition. We have a marked example of that in my own town, and it would appear that if that continues there may be a need for rationalisation.
7.39 p.m.
Mr. Andrew MacKay: I start by declaring an interest. I am consultant to a private house building firm, Birmingham Housing Industries Limited.
I concur with most hon. Members that we should not be party political in the debate. Governments of both political persuasions have been far too political in their decisions, which have been taken by politicians who know far too little about housing problems from the point of view of both the industry and local authorities. I should like to make a few comments and observations and ask a few questions based on my experience of the building industry and experience as a Member representing a constituency where well over two-thirds of the houses are in the ownership of the local authority. I hope that the Under-Secretary will pass these comments on to the Minister for Housing and Construction, and that some of my questions may be answered at the end of the debate and that I may have answers to the others in writing in due course. None of my points will be party political but will concern matters of genuine concern and, I hope, will be highly constructive.
First, it is vital to agree that it is in the country's interest that as many people as possible purchase their own homes. Opinion polls have proved that to be immensely popular. The great majority of people, particularly young newly married couples, aspire to own their own homes. It is our duty not only to encourage that aspiration but to make it more than an aspiration—to make it a fact.
Secondly, I am sure that socially and psychologically it is in the interests of the well-being of the country as a whole that the majority of people own their own homes, thus becoming more responsible citizens, feeling that they are part of society and living a fuller life.
There are many schemes to encourage people to buy their own homes. Both

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parties have been toying with the idea of giving incentives to first-time buyers. In the most telling contribution of the debate so far, my hon. Friend the Member for Buckingham (Mr. Benyon) rightly pointed out to my own Front Bench that we should not willy-nilly give financial assistance to every first-time buyer, whatever his or her financial standing, but should encourage those who would otherwise be unable to start on the road of house purchase.
We must also make sure that there are plenty of homes available. Here perhaps I may be slightly critical of the Government, as I have been before. It was wrong for the Government at the turn of the year to restrict the funds that the building societies were lending to buyers. That meant that there was an artificial control on the market, which in fact has led to a bigger increase in house prices than otherwise would have happened. It had the reverse effect to that which the Government wanted.
I am sure that the Government's objects were honourable. They wanted to restrict the rise in house prices and thought that they could do that by restricting mortgages. Unfortunately, they forgot the one vital factor—that house prices rise when the demand for houses is greater than the supply. When the Government restricted the allocation of funds, particularly to second- or third-time buyers, those people simply stayed put. Therefore, there were fewer houses available to first-time buyers.
Moreover, the Community Land Act and the development land tax mean that very little land is coming to market now. That in turn means that fewer houses are being built in the private sector. The houses that are being built are in great demand, and therefore the prices are going sky high.
As a builder in Birmingham, I can assure the House that we are desperately trying to find fresh land to buy, and this is becoming increasingly difficult. When some land is available at auction, a large number of builders bid for it along with us, and the prices there are now going to more than £100,000 an acre for land that is not prime residential land.
That will not affect my company. We shall keep our profit margins the same. The person who will be affected by that
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shortage of land is the poor house buyer, particularly the first-time buyer whom we are supposed to have been helping. He will not be able to get on to the merry-go-round of house purchase.
Therefore, I am pleased that my party is pledged to scrap the Community Land Act. We should also reduce the development land tax to a level that is socially acceptable. I accept, and I think that the majority of my party accept, that there should be a substantial tax on profits made from the chance of planning fate, when land changes from being worth £1,000 an acre to £100,000 overnight. But the tax should not be so punitive that those who own the land do not bring it to market at all, which is what is happening. It is causing house prices to rise dramatically.
I believe—and I think that here the Government are moving along the right lines—that whatever party is in Government should ensure that local authorities either build on the land they own or sell it for building by the private sector. The nationalised industries and other public bodies should likewise be forced—I repeat "forced"—into selling their land. It is a national disgrace that in many of our cities there are large tracts of land lying derelict because they are owned by the local authority or various public bodies which are simply sitting on it. I am sure that we should be right to make them sell.
I am not suggesting that to increase the amount of land available there should be major encroachments on the green belts. It would be wrong to have our agriculture or our countryside further affected by the expansion of our cities. I am satisfied that in Birmingham—and I suspect that this is true of the other cities of the United Kingdom—there is more than enough land available within the city boundaries for building for many years to come, provided we ensure that that land land comes to market, and that when it does so it is quickly built upon.
When we talk about purchase, we must talk about purchase in the public sector as well as in the private sector. Many Labour Members have mentioned the sale of council houses. I think that some of their complaints are valid and reasonable. I do not think that it is right to sell an empty council house when there are

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people still looking for houses. It is intolerable that purpose-built accommodation is sold. It is most unfortunate that there are different valuations of identical houses which are being purchased. I have in my constituency a case very similar to that described by the hon. Member for Birmingham, Erdington (Mr. Silverman), whose constituency is a neighbour of mine.
However, I believe that it is in the interests of all concerned that council houses should be sold when the local authority has other accommodation for people wanting property. Let me take the example of Birmingham. I am glad to see that the hon. Member for Birmingham, Ladywood (Mr. Sever), who talked about housing in Birmingham, has re-entered the Chamber. There is no difficulty for him or me in finding people property in which to live in Birmingham if they are homeless. But the accommodation might be inappropriate—for example, a tower block for a young family or a house for an elderly couple who cannot get upstairs. There is no shortage of accommodation as such; there is a shortage only of the right sort of accommodation.
Therefore, I believe that we should agree to sell council houses. Sitting tenants who are buying their council houses would not move out if they could not buy but would stay there until they died. Therefore, by selling to them we are not robbing someone else of their houses.
The people who really deserve to buy their council houses are the tenants of very long standing. It greatly disturbs me that they are often the people who are not buying in my city, because they are aged 50 or over and can obtain a mortgage only over a short term and cannot afford the repayments.
When my right hon. and hon. Friends on the Opposition Front Bench discuss the level of discounts that we shall allow when we return to office, they should consider my suggestion that the greater discount should go to the person who has been a tenant for a longer period. I see nothing wrong in a tenant of, say, 25 or 30 years' standing having a 50 per cent. discount, because he or she will almost certainly be unable to afford a
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larger mortgage. Such people are the ones we should be particularly encouraging.
Now that I have moved on to the public sector, I should like briefly to talk about municipal housing. First, let us be honest: in our big cities it is hopelessly bureaucratic and inefficient. It is not working properly at all. We have had a few examples today. Let me give a few more. Repairs are carried out so badly and so expensively that the position is unbelievable. In my constituency, the state of some council houses is extremely bad. When the tenants of those houses write to the housing department asking for repairs to be carried out, they do not even receive an acknowledgment of their letters. That is why at least two-thirds of the constituency cases which come to me are housing cases, and I have no doubt that much the same goes for most of the other Birmingham constituencies.
It has been said already by the hon. Member for Erdington that houses are left empty for long periods. However, I do not think that the state of affairs is as sinister as he suggests and that they are being left empty so that they can be sold to private buyers. They are being left empty because the housing department is so large and inefficient that very often it does not know that they are empty. By the time it finds out, offers the houses to people on the list and they say "No", it can take six or nine months. As a result, there is not only a loss of rent revenue, but, even more important, it means that people who could be living in more suitable accommodation are bringing up their young children in tower blocks for six months longer than necessary.
The problem of rent arreas is considerable and is not dealt with properly. That applies both ways. Those with considerable rent arrears are not dealt with quickly enough because the arrears are not noticed quickly enough. On the other hand, recently a constituent of mine who with his wife had been a tenant for 50 years and was in his early eighties, never having once mised a week's rent, received a letter saying "If you do not pay your arrears to date by the end of the week, you will be evicted." I ask the House to visualise a person of 80 who has been a tenant for 50 years and

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never missed one week's rent getting a letter of that kind.
It goes without saying that as the Member of Parliament concerned I received a written apology from the city housing officer, and I made sure that his deputy went and grovelled before that tenant. But it is not good enough. It is quite possible that one or other of those elderly people could have had a heart attack or, even worse, died on the spot, and this was all due to the inefficiency of the machine. No one sent that letter deliberately. That was no malice. It was simply part of the inefficiency of the very large machine which is needed to run a large local authority housing department.
As for the building of new property, in Birmingham there is no shortage of accommodation, as the hon. Member for Ladywood confirmed. There are only shortages of certain sorts of accommodation. I suggest that the Government emphasise to local authorities that they should build far more warden-controlled accommodation for the elderly. This in turn would help the social services. Many elderly people who cannot cope easily with a large house and cannot climb stairs easily do not want to go into residential homes. They want to look after themselves, and warden-controlled accommodation seems to be the best answer. If those warden-controlled bungalows were built in large numbers, a large number of family houses would be freed and it would be possible to remove into them all those young families now living in tower blocks.
In my constituency, I have more than my share of tower blocks. A large number of the flats in them are occupied by young families. I ask hon. Members to imagine trying to bring up two or three children in a tower block flat. There is no garden. There is vandalism. The lifts do not work. The lack of maintenance is appalling. That is no way in a civilised society to bring up young children. It is no small wonder that many of them become muggers and vandals.
Why did we build tower blocks in the first place? That must be the biggest condemnation of municipal housing imaginable. If my building firm had built those tower blocks of flats, the chances are that I would not be here today because the firm would have gone
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bankrupt and I should not be eligible to be a Member of this House. The private sector has to make a profit. Therefore, my firm builds houses only for people who want to buy. If they do not buy them, we make no profit and we go out of business. There was no demand for tower blocks of flats.
The planners try to tell me that tower blocks save space. They do not. It is possible to get as many habitable rooms per acre by building three-bedroomed town houses as it is by building tower blocks of flats. Those hon. Members with tower blocks in their constituencies will recall that there are large spaces round these blocks, presumably because of the fear that they may blow over and to ensure that there is no additional damage to that to the poor devils who live in them.
Mr. Sever: Does the hon. Member accept that in the areas to which he is referring where the tower blocks are, especially in Birmingham, the density is well above 100 habitable rooms to the acre and that in some specific areas—Ladywood is an example—it is almost 200 rooms to the acre? In line with modern thinking, I do not think that we would attain the densities that the hon. Gentleman suggests. Will he accept further that the criterion 20 years ago when most of these projects were planned was not necessarily how much space they would take up but how much space there was available?
Mr. MacKay: I do not accept that. I have great respect for the hon. Member's knowledge of housing, especially in the inner city of Birmingham, but I am satisfied that it is possible to achieve as many rooms per acre by building houses as it is by building flats. I have taken professional advice on the matter, and that is what I have been given to understand. What is more, these are perfectly acceptable houses which meet Parker Morris standards. Therefore, there was no excuse to build flats.
Incidentally, I might add that Tory-controlled councils were equally to blame. The tower blocks were status symbols. In the late 1960s the boast was that we had built a few more than another local authority. The leader of the Labour group would try to tell the leader of the

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Tory group that he had got up an additional 10 tower blocks during his term. This was complete irresponsibility, just as it was to use the bulldozer and knock down many perfectly reasonable houses only to replace them with large estates which had no character and which lost all the community spirit. That is why I am pleased to know that there is agreement on both sides of the House not to use the bulldozer any more but instead to ensure that older houses are refurbished. Such a policy costs a great deal less, and it preserves the community spirit.
If we are to build further housing estates, we must not build large ones. When it comes to housing, small is beautiful. Very large estates are unmanageable, they lack character, they are quite unsuitable for people to live in and they are another example of where municipal housing has gone wrong.
I end as I began by asking the Undersecretary of State whether he can arrange for his right hon. Friend the Minister for Housing and Construction to answer as many of my arguments as possible. I have put them forward in as non-party political way as I can. I believe genuinely that we can sort out the housing problem provided that we have agreement on both sides of the House. There is far more chance here than in almost any other area of government and public life. It ill behoves any of us not to allow that to happen.
7.58 p.m.
Mr. Ronald Brown: I found two aspects of the speech of the hon. Member for Birmingham, Stechford (Mr. MacKay) extremely interesting. The first was that Birmingham had no housing problem. I envy Birmingham greatly. Some day I hope that someone from Birmingham will explain how this has been achieved so quickly.
The other interesting aspect of the hon. Member's speech was his faith in architects. In 1956 and 1957, when I was chairman of a housing committee, it was the architects who persuaded me that they could not put houses on a site in the way the hon. Gentleman described. I believe that one of them was a past president of the architects' institute. The tower
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blocks were built because of the architects—that was their advice to elected members—not because the elected members wanted them. It was because they were told there was no other way if we were to house 200 persons to the acre. It could be done only by building into the sky. By 1958, we realised that we had been misled, and most authorities stopped building them. But, of course, by then the damage had been done.
The hon. Member for Stechford, with oratorical skill, tells us, in 1979—20 years later—that it was silly to build these high-rise flats. But it was the advisers who told us that they had to be built in the way that they were. I can assure him that if I were him, I would not place too much reliance upon architects, because they change according to the time of the year.
I should like to congratulate my right hon. Friend the Secretary of State on his speech today. I think that he introduced some interesting concepts. His decision that he will now identify priority estates for improvement is a first-class idea. I can only hope that he will ensure that included in the criteria for a council to claim under this particular aspect of the policy will be the issue of dampness.
The hon. Member for Stechford might recall that the advisers to whom he now talks, when told about dampness—that is, when one has got salmon jumping out of the skirting boards—will say that it is not dampness but condensation. If one has water running down the walls, the windows and everywhere else, with everything soaking wet and beds rotten with dampness and mildew, the adviser will say that it is condensation. If one asks how it can be stopped, the advisers will say "Oh, of course, they are concrete walls." When asked why they were built with concrete walls, the answer is "Of course, that is a problem. Let us open all the windows." And so one goes on, in this silly way.
I keep asking my right hon. Friend's Department what is wrong with the Building Research Establishment, because it should be involved in this. Condsensation is now becoming commonplace. I am sure that many of my hon. Friends have the same situation in their surgeries, with people complaining about dampness. One goes round to see it, and it is dampness. I do not care what one calls it, but

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it is unforgivable that people are expected to live in such conditions.
Only recently, after four years of fighting my own local authority's advisers and officials and the builders, I discovered that three maisonettes are empty because nobody can discover why water is coming through the flat roof. I could have told them myself, but they cannot discover it. They resolved the problem in the first instance by telling one of my constituents that the best thing she could do was to pull a table under the hole in the ceiling which they had drilled to discover where the water was coming from. Naturally, the water came through this hole, and my constituent was told to pull the table along, put a bucket on top, catch the water and when it got full change the bucket. That is how the poor woman went on. I went to see it just to make sure it was true, and there it was.
When I talked to the officials they said "Yes, it is a problem, but we do not know where the water is coming from." That woman was left like that for weeks, before I finally said to them that the council must find an empty flat because she could not go on in that way.
I still believe that if the local authority cannot resolve such a problem the Building Research Establishment ought to be able to find some answers. I hope that when we are talking about improvements this particular problem, which is all too prevalent, will be considered. As has been said, the decision to relax the 30-year rule will be a tremendous advantage. The rule has caused problems in the past. Its relaxation will be extremely helpful to local authorities.
My right hon. Friend referred to fire precautions. Last week we had an awful tragedy when a tower block of flats in London caught fire and the fire brigade could not reach the upper floors because there were no fire escapes high enough to reach them. Such fires will continue. I keep on about polyurethane and other such disastrous materials, which are still used and which make it impossible for anybody to get out of a tower block flat if it catches fire. There is no way in which people can get out, because these materials burn so rapidly and with such intense heat and tremendous superheated smoke that they are dead before they have even been affected by burning.
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It is wrong to ask people to live in such conditions, and only last week the dangers that many of us have been forecasting were evidenced. I hope that my right hon. Friend will be able to tell us what advice his Department has to offer to local authorities about flats and maisonettes in tower blocks which are above a level which firemen can adequately serve. It is important that advice and help should be given.
I now turn to the antics of the GLC in London—with emphasis on the "antics". The GLC is the world's worst when it comes to misbehaving with regard to housing; it takes the biscuit. I hope that the decision to stop the sale of council houses will be effected as from today, because those jokers in the GLC will do everything they can to try to find ways and means of getting round any instructions that come from the Department I hope that the Department will take steps to make certain that the sale of council houses by the GLC is stopped as from tonight. The behaviour of the GLC is quite appalling.
The House might be interested to know that the GLC is proposing to sell 3,000 new and rehabilitated homes—they are empty houses—at a capital loss of £17½ million. It is planning to lose £17½ million. It is unbelievable. The GLC is paying £2 million to estate agents to "flog" the 3,000 houses. Therefore, with the £17½ million it is planning to lose and the £2 million that will be paid to lose it, nearly £20 million will be lost for that silly, soppy exercise—and that is ratepayers' money, taxpayers' money.
The hon. Member for Henley (Mr. Heseltine), whom I do not hold in very high regard since the day we had to make him come here and tell the House that he had told a lie—I do not forgive a man for telling a lie—and admit his offence and apologise, talks about a waste of public funds and is then unable, with the hon. Member for Hornsey (Mr. Rossi), who knows the facts, sitting next to him, to say at the Dispatch Box "I despise the GLC for wasting nearly £20 million of taxpayers' money." I do not understand him at all.
I come to the rather interesting situation where I recently asked how many tenants the GLC had in my own constituency. I was told that it had 17,600.

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I then asked how many had applied for transfer and was told that the number was 4,245—24 per cent. of the number who wanted a transfer. The GLC then said that these constituents had registered a transfer application and had indicated a preference for houses with gardens. The GLC said—as I am aware—that it does not have many houses with gardens in my constituency.
Another question I put to the GLC was how many properties it had in my constituency, and the answer was 5,625. I asked how many of those properties had gardens and was told that the number was 81. So out of 5,625 estate properties, 81 are houses with gardens. After 15 years of pressing the GLC to build houses with gardens in my constituency, we now have one estate which has 75 flats and maisonettes, and 65 houses with gardens. They will be completed at the end of this year. It was our administration that began the building.
The chairman of the housing committee said:
" I am very pleased, and so are my colleagues, that the Housing Policy Committee had just approved the sale of the 65 houses."
So, after waiting 15 years to get these houses, and having been told that in the whole of my constituency I have 81 houses with gardens, we now find that 65 houses will be available for sale at the end of the year. Many people have been desperately waiting and hoping that they will be transferred into these houses, but the chairman of the housing committee is "very delighted" to tell me that they are now up for sale.
The people of Hackney will thank my right hon. Friend very much indeed for his statement about stopping the sale of council houses. It is interesting to see the figure for the sales in Hackney, where we have more poor people, more one-parent families—one names it and we have got it; we are right at the bottom of the scale. The price of the 65 homes is to be £35,700 each. I am sure that there will be a big rush in Hackney for them! I am sure that people will be queueing up all day. It is quite unbelievable that the GLC believes it can sell the houses at that price.
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Even if we take £3,500 off the price as a discount, who does the GLC believe it will find in my constituency to pay that sort of price? We have 12,000 people on the waiting list in Hackney waiting for a proper home.
I turned over the page of the information that I received and discovered that Waltham Abbey is also building houses for sale. But those homes are being sold for £19,300 each. Therefore, I hope that someone can explain why Hackney is being screwed for £35,700 per house whereas similar homes in Waltham Abbey are being sold for £19,300.
I turn to the problem of transfers in my area. This is the one area where people in Hackney have to rely upon the transfer system, otherwise I have a housing Colditz. Until tonight, when council sales will stop, I had a housing Colditz in my area because no one could get out. It is extraordinary that since the Tories at County Hall decided to go ahead with their policy of selling council houses there has been a slowing down in the number of transfers that have taken place, not only in terms of numbers and in the length of time but also in the quality of properties that are finally offered.
The number of homeless families has also been increasing. At the end of 1978, the Hackney authority had succeeded in getting the number of families in bed and breakfast accommodation down to 20. It is terrible for people to be put into bed and breakfast accommodation. Now, as a result of GLC activities in taking people to court, getting them thrown out and making them the responsibility of the local authority, Hackney has 78 families in bed and breakfast accommodation. That was the figure in February this year, and it has resulted simply because the GLC is wedded to the policy of getting out of housing and getting rid of its housing stock.
In addition, the 32 London boroughs which are nominating to the GLC are experiencing exactly the same thing. The result is that at present Hackney has about 1,000 nominations for transfer waiting in the GLC offices. Our people are desperate to move from their existing properties to homes in other areas which they believe to be more suitable.

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Conservative Members argued earlier about the rights of people. Have my people no rights? Do not they have the right to transfer to more adequate accommodation? Does the GLC have the right to stop them because for political purposes it is choosing to take a particular course of action? I do not understand Conservative Members arguing for the sale of council houses. There are plenty of houses for sale if one can afford them.
I agree with the idea of owner-occupation. In fact, Conservative Members should remember that this Labour Government have done more for first-time buyers than the Conservatives did.
Mr. Andrew MacKay: What have the Labour Government done?
Mr. Brown: I shall tell the hon. Gentleman. I smiled a moment ago when it was explained that the Labour Government had stopped councils from giving mortgages. The Conservatives had that argument thrown back in their faces, because in the end it was seen that we had given more mortgages rather than fewer. The argument then centred around council mortgages. In 1961, I tried to shift £1½ million of the local authority's money to the purpose of providing mortgages and Lord Brooke of Cumnor, who was then Minister of Housing and Local Government, told me to stop that nonsense because it was the preserve of the building societies. But we did it just the same.
The fact is that at that time the Tories were not concerned about councils lending money. They may have been converted, but they should not make it out to be a virtue. The hon. Member for Henley tried to pretend that there was some great virtue in this. But we all know that orginally the Conservatives were never in favour of councils lending money.
We have also heard the argument in favour of housing associations. But housing associations are paid their grants on the number of units that they produce. In Hackney as a whole, 369 families are waiting for four-bedroomed accommodation and 114 for five-bedroomed accommodation. If the GLC does not help with a continuing building programme, these people will never be able to get
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a suitable home. When one asks the housing associations whether they can deal with this group of people, one is told that they cannot. One is told that if they take over a house it is financially more advantageous to convert the house into two units, because they are paid per unit. I therefore hope that my right hon. Friend will have a look at this problem, because it seems too absurd. How can we take care of the large number of families who are anxious for larger accommodation if the one area which I believe to be most useful—the housing associations—is dissuaded from doing so for financial reasons?
I hope that my right hon. Friend will also have a look at the means of transfer. I hope that he will have a look at the proposal to dump all GLC properties on to the boroughs. If the local authority is situated in an area which has nice houses, it is only too happy to have them handed back by the GLC. But that means that the people in my constituency will never have an opportunity of obtaining those houses. There must be some nomination scheme between the boroughs to ensure that areas such as mine have an undeniable right of sharing some of those houses in other boroughs. I am not a great believer in making something mandatory if it can be avoided, but this will have to be mandatory, not only in respect of the total number that each borough must offer but with regard to the quality and type of house offered.
I should like to give some up-to-date figures. Since last April, we in London have tried to introduce an inter-borough scheme for nominations. Hackney received 393 nominations for transfer to other boroughs, but has succeeded in rehousing only 37 families. Seventy-eight people were nominated in Waltham Forest, but only two have been rehoused. In Barnet, 35 families have been nominated and only two rehoused. In Enfield, 38 have been nominated and only one rehoused. But 46 people from other areas desired to come to Hackney, and 22 of them have already been rehoused. It will be seen that 50 per cent. of the applications in our case have been honoured, whereas those going out from us are not honoured. It is certain that we shall have to take action to ensure that there is a nomination scheme. If my right hon. Friend is of a mind to permit the GLC to go ahead

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transferring houses to the various boroughs, this has to be so.
Housing is a vital issue. I have been surprised at the unanimity there has been on the basic issues. What started out as a total battle with the Government, with a three-line Whip on the Opposition Benches aimed at proving how wrong the Government were, has petered out. There are only a few Opposition Members left and in the main we are all agreed on what we are doing and that we are doing a damned good job. Everyone is trying to be non-political, and I am in favour of that. We are talking about things that matter.
Tory councils throughout the country which took the advice of the Opposition Front Bench and consistently failed to produce houses for people have behaved appallingly. Their behaviour ought not to be paraded as a virtue. They should be condemned by all decent people because it is these councils which are responsible for the fact that fewer houses have been built this year than last year. We ought to add that it is the decent, nice people who are being made to live in dreadful conditions because of sheer political claptrap. This means hardship for many men, women and children.
8.21 p.m.
Mr. Tony Durant: I am delighted to have the opportunity of speaking briefly in this debate. I know that others of my hon. Friends wish to take part and I am aware that some speeches have been rather long. I agree with the hon. Member for Isle of Wight (Mr. Ross) on the question of housing numbers. The units are pretty well right throughout the country in relation to population. The problem we face is that we have too many units of the wrong sort in certain places. The hon. Member for Isle of Wight made a valid point—I am sorry that he is not here—when he said that housing ought to have a regional element. We should look rather differently at housing in certain parts of the country. I come from an area where there is a housing need, and there probably will be such a need for many years to come. There are other parts where this is not so.
The national needs are for more low-cost private housing for sale and more
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smaller units in the local government sector. In many local authorities there is a shortage of the small units. They have large units, meant for large families, and these large families do not always exist. Frequently there is difficulty in obtaining two-bedroom accommodation. The Minister said that house prices had been stable. I should like him to visit my authority, because that is not so there. In my area house prices have risen by 30 per cent. However, he is probably taking the national picture, and there are sharp differences throughout the country.
I agree with the point made by my hon. Friend the Member for Birmingham, Stechford (Mr. MacKay) about land held by nationalised industries. In answer to questions of mine, the Government have said that they are reviewing the amount of land held by such industries and intend to produce a policy to deal with this. We have not yet seen this policy. There are vast tracts of land which could be released to help ease the housing problem. Further, too much land is owned by local government.
The construction industry, which is the other element in this picture, has been through a difficult time. Many building firms have closed down. Even in an area such as mine, where there has always been housing need, two or three reliable and long-established building companies have gone bankrupt. The reason for this is that recently Governments have been using housing as an economic regulator in a way in which the motor car industry was once used. What the construction industry needs is a steady building programme, without peaks and troughs. The Labour Party's veiled threat of nationalisation does not help. It does not give stability to a fluid industry. People are against nationalisation and do not believe in it. It is a pity that the Labour Government still feel that this should be examined.
We must free more units. The Rent Acts have been mentioned. Rent control has been a great deterrent to the availability of accommodation, particularly for single people. In my area we need skilled men, but they cannot move there because there is nowhere for them to lay their heads. The Rent Acts have dried up a great deal of furnished accommodation. It is time that the Government came forward with some proposals.

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My hon. Friend the Member for Norfolk, South-West (Mr. Hawkins) raised the problem of old people's accommodation and the deterioration of their properties. Certain banks are prepared to grant annuities to old people to maintain and improve their properties. But under our present tax laws there is no concession for that. That is a pity, because it would enable them to look after their properties. These schemes make good sense and should attract tax relief.
The hon. Member for Gravesend (Mr. Ovenden) talked nonsense about the sale of council houses. It was the most discordant speech in the debate. He was inaccurate about building societies and the sale of council houses, and he is not well informed on the subject. I have been involved in the sale of council houses in Nottingham. Certainly there it is not the newest properties that are being sold. I had the privilege of handing over the deeds of one of the properties. A coloured immigrant lady was buying a terraced house in a long row. When I asked her why she wanted to buy it, she told me that it was because she had put a lot of money into the property. What is wrong with that?
We must carefully examine the management of council estates. Housing departments of local authorities are good at keeping housing lists, building new council estates and managing priority lists, but the management of the estates, once built, is a great weakness. There are problems with repairs, coping with vandalism, lack of community spirit and lack of facilities. Councils should consider having two departments, one to deal with new council housing and another for management. Managing council estates is a skilled job, and perhaps housing associations should be offered the opportunity to take over new council estates. There can be nothing wrong with divesting a council estate to a housing association. Housing associations know how to manage, and that is important to tenants.
Residents' associations in council estates should be fostered. There is a need for administrative back-up. People who live on council estates are not natural secretaries. They are good at the job of chairman, having initiative and drive, but not at basic administration. Residents' associations spring up with great enthusi-
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asm but collapse because no one sends out the notices. That is simple but important.
We must also examine building standards. We have had much discussion about high-rise flats. It does not matter who is to blame, but they are there, and sooner or later we must get rid of them. They are a terrible indictment of our society. They are not the way to house people. Everyone wants a home of his own. It is a pity that the Labour Party is still nervous about the idea of home ownership. It does not appear to mind home ownership if a house is being bought from another home owner but believes that buying a council house is dangerous.
I am in favour of the sale of council houses because I do not like the "us" and "them" attitude. People tend to think "That is a council house over there and they are funny people", and "That is all private over there". I like a mixed estate. People should own or rent their homes in a mixed community. That is much better for our society.
I am all for fostering more housing associations. It is a pity that we have not looked more closely at housing associations, because there is much more that we should do. All people want to own their own homes, but if they cannot afford ownership they want good-quality housing.
Reference has been made to council officials who walk around council estates telling the tenants that the damp is only condensation. This is one of the oldest problems. I have to deal with it constantly. Every week I go to a council estate where they tell me that a council official has told them that the damp on their walls is condensation and that they should open the windows and turn up the heating. This is not the way to deal with civilised people. They do understand about these things; they are not idiots.
My local authority has now decided, after five years' hammering from me about a particular block with so-called condensation, that there is actually a hole in the roof. At long last the authority agrees that this might be the cause of the damp. Frankly, most of the residents knew that all along. They did not need anyone to tell them that. Therefore, the question of using the Building Research

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Establishment to aid local authorities with these problems, particularly in the concrete-built blocks, is something which the Department must consider.
The Under-Secretary of State visited my constituency the other day and came up against a resident who was very dissatisfied with his property. Perhaps the workmanship was poor. Town halls must take acccount of problems like these. People's standards are higher, they want better conditions and they are entitled to them. Let us have no more talk about condensation. Let us talk about damp in properties, and let us do something about it.
I am delighted that we have had this debate. It has been a useful exercise and all hon. Members should take account of people's basic desire, which is to have a decent home of their own.
8.33 p.m.
Mr. Eddie Loyden: The speech of the Secretary of State on the Government's housing policy is entitled to two cheers. It begins to identify the problem in a different way from all past attempts. It is vital to understand that there is not a standard housing problem throughout the United Kingdom and that it differs from area to area, and even within areas. In that sense, the speech of the Secretary of State about unsuitable accommodation built in the post-war period and the attention that will be given to it by his Department are encouraging. At long last the problem has been recognised, and we all hope that some action will follow.
It is true that the housing problem of this country is not new. It has been with us since the dawn of man, so to speak. I cannot recall any time when we have not had housing problems. both locally and nationally. If one examines the massive contradictions in our society in this area, one gets a little nearer to the truth and nearer to the solutions that the truth exposes.
One or two particular attitudes have been adopted in these discussions. Many hon. Members have illustrated the problems in their constituencies. It is important to recognise that there is an overall problem, which needs central Government activity, and a local problem, which needs local action. I very much agree with the
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hon. Member for Reading, North (Mr. Durant) that the management of council estates is very important. This management is in sorry state, and something should be done about it by the Department.
The problem can be subdivided into four categories. The first is that there is still a shortage of houses. That has been established in contributions by hon. Members from both sides. Secondly, we have to recognise that there is still an unacceptably high level of unfit houses. The third problem is an unacceptable number of houses that lack basic facilities or amenities. The fourth concerns post-war housing construction, which has created problems on major council estates.
All these problems start from the fact that there is still a shortage of housing. A massive contradiction in my area is that there is 15 to 20 per cent. unemployment among building workers, there is no shortage of building materials, there is certainly no shortage of demand for homes, and yet we face a situation where a solution cannot be found to these three ingredients of the problem. The main cause is that the market remains the major influence on house building.
Conservative Members have argued the value and the benefits of the sale of council houses. Again, my area shows a massive contradiction. There are endless private properties for sale, and endless numbers of people requiring houses, yet the local authority decides to embark upon a build-for-sale programme. My right hon. Friend has visited an estate in my constituency. He knows enough about it to be able to make an assessment of the problems that exist there. People are virtually trapped in accommodation that is inferior. There is a serious fire hazard in many of the flats which are occupied by elderly people. Other problems are water penetration, damp and bad structural faults—all criticisms usually applied to the vast council estates built in the post-war period.
I ask myself how it has happened. The same construction companies build the beautiful private estates within walking distance of the spine blocks of flats at Netherley. But they are built to different standards, with different layouts and better landscaping and environment. If one compares the cost to the local

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authority of building the monstrosities in Netherley with building often by the same builder in the private sector, it must pose a serious question whether local authorities are getting value for money from the constructors. Does the age-old attitude still prevail that there must be a difference in structure and environment between council houses and private estates?
All of these matters have contributed towards the problem that exists in housing. I hope that my right hon. Friend will tackle seriously the problems of those who are committed to remain in these properties for the rest of their lives, facing additional problems when flats beneath or alongside those in which they are living become vacant and are eventually vandalised. There is a growing number of such properties on the Netherley estate and on estates elsewhere in the country.
We cannot go on asking the residents of those estates to put up with the hardships both of the houses and of their environment. The two things are connected. When people are totally dissatisfied with their environment and housing, that shows itself in the community in a couldn't-care-less attitude and often in vandalism. I hope that my right hon. Friend will seriously seek other ways, perhaps by means of pilot schemes, of decanting unsuitably housed families from those places. After an examination in depth, perhaps he could consider whether they can be given alternative housing. I shall not go into what that might mean, but such an examination should be made. One problem with these types of tenants is that the sale of council houses adversely affects their opportunities to transfer to a house with a garden, which all hon. Members agree is the right of a family, particularly one with young children.
We should also consider the allocation policies of local housing departments. It is easy to design an allocation system which prevents people from being housed. One just sets up a certain number of points—perhaps 18—and then sees that no one reaches that magic number. In that way, people are kept in unsuitable accommodation for the rest of their lives.
The allocation policy should be designed to meet the needs of people in unsuitable housing and not to frustrate
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their desires. A remedy cannot be found overnight, but I welcome the step that my right hon. Friend has taken in the right direction. It is vital to the future of our housing concepts to examine the post-war estates and see whether we have the courage to admit to the mistakes which have been made. Then perhaps we can take action to relieve these people of the suffering they have had since they occupied their present premises.
Several Hon. Members Several Hon. Members rose—
Mr. Deputy Speaker (Mr. Oscar Murton): Three more hon. Members want to take part in this debate. May I suggest that they speak for five minutes each?
8.44 p.m.
Mr. Michael Latham: I shall comply with your wishes, Mr. Deputy Speaker. I therefore shall not follow the theme of the hon. Members for Liverpool, Garston (Mr. Loyden) and will abandon that section of my speech. I want to get on immediately to the subject of land. I speak as a house builder myself.
The serious land situation should be properly discussed tonight. It is probably the hardest problem of all to solve. To a house builder, particularly if he is operating on a rising market, it is important to maintain a small but viable land bank of at least 18 months and preferably longer. Bearing in mind the fact that the typical house builder has a small or very small company, he looks for land in the locality he knows—usually a rural or suburban area, with a green field site being his prime aim, preferably near one of his previous developments and not near one of those of his competitors. He wants the site to be serviced or be capable of being serviced quickly. He wants a readily marketable proposition, and he should be able to proceed with it at a speed dictated by his business acumen.
All those points give at least three areas of conflict between what the builder wants and what the local authority or the electorate want. First, there is the choice of a rural area. Conservation pressures against rural area use are growing stronger, and planners do not like it either. Secondly, on suburban sites, which involve the demolition of Victorian or Edwardian property, conservationist

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pressure is also growing and traffic constraints often militate against more intensive development. Then there are the cost constraints, the need to put in sewers and so on.
The original instrument of Government intervention in the land market was the Community Land Act. In England and Scotland this Act has proved a dismal flop. The English record in the first two years of the Act can be summarised simply: land purchased, about 2,300 acres; land resold, about 170 acres; Government circulars and directives, 141; total local authority expenditure, £37·6 million, of which £6·5 million comprised administrative costs. Total local authority income amounted to £5·9 million, and the net deficit was £31 million.
Only three local authorities have managed to make any profit so far—just three out of all the hundreds of local authorities. One such authority was Leicester city. Parliament was not allowed to know the details, because Ministers refused to give them. Fortunately, the city council was much more helpful. In 1976–77, the first year of the land scheme, it bought a 7·6 acre site, which was part of a former gasworks. It carried out some works to improve the access and sold the site in two parcels for industrial and commercial development.
The site purchase cost £281,716. Administrative costs and interest charges in that year were £24,624. In the following year, 1977–78, infrastructure costs and further interest charges amounted to £51,139. The site, divided into two parcels, was then sold on a 99-year lease for £401,064. This produced a surplus of £43,585. Alas, even that modest profit was heavily raided by the Government and by the national and county pooling system, and the city council was allowed to keep only 15 per cent. Therefore, the net profit on a total outlay of £357,479 was £6,538, or 1·82 per cent. Although the council is to be congratulated on making any profit at all—especially as there are only two other local councils in the country which managed to do so—this can hardly be called the sort of return that is likely to enthuse any developer, whether in the public or private sector.
Therefore, there is no salvation down the road of compulsory State trading in
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land. It is doomed to failure because it places on local authorities a duty of land dealing which by temperament they are totally unsuited to fulfil. It is also intrinsically undesirable because it confuses the chance for a local authority to make a quick buck with the legal power which it possesses to grant planning permission.
The advantage, such as it is, of the Land Authority for Wales is that it has to seek planning permission, in common with any other developer, and is sometimes refused it. The developer and the planner should be at arm's length—not the same person.
If there is one area in which early action is both possible and desirable, other than the repeal of the Community Land Act, it is land taxation. In common with some of my hon. Friends, I have always preferred a relatively high rate of land taxation, provided that it is not confiscatory. I have always thought that 60 per cent. was the right figure. But if we are to make any real progress in inner city redevelopment we shall have to grasp the development land tax nettle much more ruthlessly. In respect of the more difficult inner city sites, I favour a nil rate of DLT but a substantial financial contribution by the developer in respect of all identifiable infrastructure costs.
As for damaged or difficult sites, such as disused docks, where the infrastructure costs are huge and the real residual value of the site is nil, there is a case for a negative rate of DLT—an actual tax remission or grant to the landowner, who in this case is usually a public authority, such as the Port of London Authority. These sites will never be developed at an acceptable speed if the Port of London Authority or similar organisations have to put them on the market at below what they consider a fair level of financial return or if the price is so high that the acquiring authority, be it a local council or a developer, has to pay so much that the scheme becomes non-viable.
That may seem an oddball idea. But the whole process of development is under tremendous strain. If it is now policy to prevent much green field site activity in the interests of conservation—and there is a great deal to be said for that from

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many angles—it is essential to get some real movement in building in the cities. If one-tenth of the effort being devoted to the Community Land Act could be devoted to these crucial but limited problems, the great log jam of bureaucratic slowness and restriction might begin to shift. If ever there was an area of policy to which Parliament should give its attention, it is the question of planning and land, because since the war successive Governments have nearly always got it wrong.
8.52 p.m.
Mr. Ernest G. Perry: In the debate a number of Members have tried to keep politics out of the housing question. That is to be admired. Some of the speeches have been a sincere attempt to try to deal with the morass of housing regulations. I congratulate the Secretary of State on his statement about the two amendments that he intends to introduce. They will be most welcome in many parts of inner London, particularly in the borough of Wandsworth. Many residents of Wandsworth will wish to thank him for having taken the initiative.
I want to deal with three points which have to some extent been mentioned by other Members. We have talked about these issues for a long time in the House and in Committees. One of them involves the question of blocks of flats, their ownership, the lessees and the tenants in those blocks. A large number of these well-built blocks of flats are owned by a ground landlord and have been sold from time to time to tenants and new owners. I receive an enormous amount of correspondence from tenants who have paid between £15,000 and £30,000 for their flats, and the maintenance charges are increased out of all proportion.
This matter was referred to by the hon. Member for Isle of Wight (Mr. Ross). The Department should examine cases where the freehold of such blocks of flats changes hands—in some cases every year—from one finance company to another and where the tenants and the owners of the flats are at risk all the time because of excessive maintenance charges and ground rent. For those tenants and owners some effort should be made so that, by means of a co-operative,
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the ownership of the land may pass to the owners of the flats.
This is a matter that the Government should examine. I hope that the Labour Government, after the next general election, will ensure that flat owners get some protection against the finance and property companies in circumstances where there is continual change of ownership of the freehold.
Much has been said about tower blocks. There are a number of these in Wandsworth and some tenants in these blocks are seething with discontent. There are 22-and 14-storey blocks of flats. On the twelfth floor there may be a wife and a husband and three or four children. The wife cannot get the children out of her sight for a moment. The family is stuck in a flat 14 storeys up and cannot move about or out.
On many occasions the lifts are out of action. One can imagine the problem in tower blocks in places such as Wandsworth. It is a social problem which must be considered. It is no good brushing it aside. We are building for the future a discontented youth. We must try to remedy the problem.
I do not wish to blame any political party for the present situation.
Mr. William Molloy: Why not?
Mr. Perry: I shall tell my hon. Friend why not. I remember the introduction of industrialised building in the late 1950s and early 1960s. That method of building was seized upon by the then Government with raptures. It was seized by both Labour and Tory local authorities because they believed that it would be the solution to their housing problems. In London in particular, tower blocks were developed. A number of scandals were connected with them.
What have we today? We have tower blocks with so-called condensation. Many problems are associated with tower blocks and they cannot be solved. Tower blocks were sold by the architects as a useful addition to our housing programme. Huge concrete blocks were lifted by giant cranes to erect the buildings. The Royal Institute of British Architects cannot dodge the blame. Many members of the

1017
RIBA must accept some of the responsibility for the inadequate building that took place in the late 1950s and early 1960s.
Mr. Harold Macmillan was the Prime Minister at that time. He wanted housing to be developed because we were falling behind. I do not doubt his good intentions. The Labour Government then tried to outdo Mr. Macmillan's Government in the number of flats that they erected. Today's problem is a result of the policies followed by the Conservative Government who were in office between 1959 and 1964 and by the Labour Government who were in office between 1964 and 1970. We are now stuck with London's tower blocks.
It would be wrong to believe that people will sit complacently by and put up with the conditions in the tower blocks. If perchance—and I do not think that there is much possibility of it—the Conservative Party was returned at the next election it would have to face the responsibility, in the same way as the Labour Party would. The problem cannot be dodged. Some blocks which have been up for only 20 years will not last another five years without much discontent.
I turn to the 1974 Act. It must be amended. Over 50 per cent. of houses in my constituency are owner-occupied. I have known for many years constituents who are retired and who used to let rooms to students. Now they do not let those rooms because sometimes they have bad tenants and they cannot get rid of them. These elderly people live in six-or seven-roomed houses but occupy only three rooms. I should like to see an amendment to the 1974 Act to cover such situations.
Bolingbroke Grove—which is named after the Earl of Bolingbroke—faces Wandsworth Common. A retired civil servant bought a house on that road. He wanted to let the top flat. He advertised and a young man applied. He was about to start work with the Daily Mail and produced a letter to prove it. He paid a week's rent. That retired civil servant got rid of that tenant only two months ago. He owed over £400 rent and nearly £80 for an electricity bill. The owner has just got rid of him. He is now dubious about letting that flat again. Having been
1018
caught once, he does not want to be caught again. He is a civil servant who always votes for me.
I suggest that we should amend the 1974 Act in these respects. I hope that when my right hon. Friend is returned as the next Secretary of State for the Environment he will take these matters under his control and do something to help owner-occupiers, particularly those who have empty rooms but are afraid to let them.
9.0 p.m.
Mr. Peter Brooke: It is always a pleasure to follow in debate the hon. Member for Battersea, South (Mr. Perry). Later I shall take up the last matter to which he referred.
It looks as though the close of the debate will be conducted by London Members. That is a pleasant reward for having sat through what has been a worthwhile debate.
I make no apology for concentrating on constituency issues. They embrace the whole of the new Euro-constituency of central London, which stretches between Hammersmith, North and Camden, St. Pancras, North, and they are relevant to all four of the local authorities within that area.
I feel emboldened to take up the subject of the city of Westminster because the Secretary of State, in his very good speech, cited the city of Westminster in response to an intervention by my hon. Friend the Member for Northampton, South (Mr. Morris).
If the House consults the national housing survey, to which the Secretary of State referred and to whose richness I pay tribute, it will see that in a number of characteristics the city of Westminster has an unusual housing stock. Incidentally, that is also true of the other half of my constituency in the city of London, but that has so small a residential population that I propose to omit it from comparison.
First, just under 90 per cent. of the total number of dwellings in the city of Westminster are flats. That is the highest proportion of total dwellings in the whole of Greater London.
Secondly, at over 27 per cent., Westminster has much the highest percentage

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of private rented unfurnished dwellings to total dwellings throughout Greater London. In the rest of the Euro-constituency, Hammersmith has 24 per cent. and Camden, Kensington and Chelsea have 20 per cent. Apart from Lambeth and Wandsworth, no other local authority in London has so high a proportion. When we take account of private furnished accommodation as well and add that, though Westminster is overtaken by Kensington and Chelsea, only the other two local authorities in the Euro-constituency to which I referred have over 40 per cent. I feel at liberty to use this heavy concentration of the private rented sector in this area of central London north of the Thames as a basis for making some remarks about the private rented sector.
The city of Westminster has two other unusual characteristics. Apart from the city of London, which I was omitting from comparison, it is the only local authority in central London which has more than 40 per cent. of its households as single-person households. That is possibly in line with its high involvement in the private rented sector.
What is perhaps more surprising is that the city of Westminster has a greater commitment to council housing than any other Conservative-controlled local authority in Greater London, with the exception of one authority in outer London which fluctuates in control between the two major parties. I mention this commitment to council housing for a reason which will bring me to the 1974 Act.
The public services in central London have found it increasingly difficult to recruit labour because, unless someone lived centrally, he would not be prepared to afford the cost of commuting to come in from further out. That has a consequent effect on public services in central London.
I shall take an example from my constituency. The South-West One district sorting office of the Post Office has much less difficulty in recruiting labour, because it can draw on the great council estates on Millbank and on the river, than the West One sorting office, also in my constituency, because there is no stock of council housing around it. The physical closeness of accommodation in the inner
1020
city makes a considerable difference to employment.
I acknowledge that evictions in Pimlico have diminished since the 1974 Act but, whatever the virtues of the Act, any estate agent in central London would tell the House that the stock of private rented accommodation suitable for secretaries has decreased severely over the last five years. About 1 million people come to work in my constituency every day and I am conscious that commercial organisations will wither—as have the public services—without the services of secretaries.
A great argument in favour of the private rented sector is the flexibility that it affords for the elderly, the young and the transient. The effect of legislation has been to diminish the stock of accommodation available for the young and transient. The Secretary of State said that the city of Westminster contained a large proportion of vacant dwellings, and he is correct. However, one riposte is that as 90 per cent. of our dwellings are flats and 44 per cent. of those are in the private sector, some accommodation in the private sector is being left empty because of the legislation.
Another impact of the Act on central London has been the deterioration in the quality of landlords. A sad feature of recent years is that well-respected British institutions in which tenants had considerable trust have sold out—frequently over the heads of tenants—to international purchasers, often from east of Suez, who have no understanding of our market. In any transaction, there will be a good and lasting deal only if it is a good deal for both sides. The departure of good landlords from the private sector out of sheer exhaustion with the problems does not augur well for the future.
The elderly are also a significant community in central London. Many are living in unfurnished accommodation and there are disturbing signs that the lack of security for tenants the rateable value of whose homes is over £1,500—a small and thus a narrow market—has been promoting rent demands, occasioned by international intervention, which are wildly outside the capacity of any British subject to pay from taxed income. This level of rents in what is, perhaps misleadingly, called the free market is actively

1021
influencing the behavour of rent assessment panels, particularly at the top level of protected accommodation. Many rent officers will privately reveal that to be so.
The lack of security of tenure for those with rateable values over £1,500 is one of the subjects which will presumably be contained in the review of the Rent Acts, for which my constituents have been waiting patiently. Therefore, it is not a subject for this debate. However, I shall put on record my deep compassion for couples in their seventies and eighties who have lived in their flats for 25 years. They feel considerable anxiety at having their future governed by an Arab landlord who has no understanding of the British system.
Within that part of the sector that has security of tenure, the variation in the quality of landlord, consequential upon the Acts, has had implications in terms of harassment. I recognise the difficulties facing the Minister in revising the legislation on that matter. However. I am equally conscious that a large number of tenants feel harassed, perhaps more by general neglect and incompetence than by active malice. In addition, many small landlords feel harassed by their tenants. The position will not improve until there is a return of trust between landlord and tenant. I endorse the views of my hon. Friends that we shall not achieve that equilibrium unless we reach a more bipartisan and imaginative relationship on housing. The fact that Westminster has a higher proportion of housing associations dwellings than has the rest of Greater London may be a pointer.
With the exception of certain rebates, the private rented sector has never received help in the form of public money in the same way as have council tenants and owner-occupiers. I hope that, if it becomes necessary for there to be an injection of public money to turn some blocks of flats into co-operatives owned by tenants, that money will be forthcoming, perhaps through housing associations.
I return to what I said at the start about my constituency being unusual in housing terms. Whatever the virtues of the Housing (Homeless Persons) Act of the hon. Member for Isle of Wight (Mr.
1022
Ross), who spoke so refreshingly earlier, the geography of Westminster is attracting a disproportionate number of the homeless, to the extent that they are crippling the housing account and effectively blocking the Westminster housing list to long-term Westminster residents. My constituency mailbag demonstrates the frustration and anger arising fom that, whatever the sympathy for the homeless.
The Secretary of State referred to preventing families living above the first floor. I understand the motivation and history behind that—the hon. Member for Battersea, South referred to the problem of tower blocks—but the rule is wholly incomprehensible to my constituents in Soho and Covent Garden. Those are communities in which I have great pride, not least because they are so different from the rest of London. My constituents live there because they like the environments and more would wish to move in if there were the opportunity to do so. They are frustrated by the densities permitted by the no-families-above-the-first-floor rule. I am not in favour of referendums on every subject under the sun, but if a referendum were held on that subject in Soho and Covent Garden, the Government would lose. I hope that at some stage we shall listen to the people who live in a place because they want to.
9.13 p.m.
Mr. Hugh Rossi: We have had a varied debate and a number of interesting and diverse points have been raised. I hope that the House will forgive me if I do not deal with every matter.
I start with the Secretary of State's speech. As always, he put on an extremely brave face and argued cogently, persuasively and, again as always, selectively. However, he and the Minister for Housing and Construction cannot escape being convicted for having presided over possibly the worst housing record of any post-war Government.
As my hon. Friend the Member for Henley (Mr. Heseltine) said, the Secretary of State stands condemned on virtually every count of his housing policy. He stands condemned on the decline in the private rented sector since 1974. Every commentator and every young person knows that, especially in Greater London, it is virtually impossible to find anything

1023
to rent except on a holiday-let or bed-sit basis, or unless one turns oneself into a private company or is a foreigner who is here temporarily.
Only the Minister for Housing and Construction continues to protest that there is no evidence that the Rent Acts have dried up the supply of privately rented accommodation, but he persistently refuses to publish the results of the inquiry into the working of the Acts. We have been awaiting the publication of those results for several years, but still the Minister delays. Perhaps he fears that he will end up with too much egg on his face and that is why he will not publish the results, particularly in the run-up to a general election. I understand his embarrassment and difficulty, but if he says that the Acts have not dried up the supply of privately rented accommodation, I challenge him to produce the results of the inquiry in the next couple of weeks and allow us all to see them.
Ministers stand condemned also for the collapse of the house building programme in both the public and private sectors. Nearly 50,000 fewer houses have been built each year under the present Government than under our Administration.
Those right hon. Gentlemen stand condemned for the collapse of the programme for housing improvement grants, from 166,000 in 1973 to 60,000 today. That is a tremendous drop in the improvement of what all agree is possibly the most necessary part of the housing policy—the resuscitation and rescuing of our existing housing stock to provide decent homes. This part of the policy has suffered cut after cut from the Government, yet we heard platitudes today about how it will be improved. I shall come to that in a moment.
Next, the Government stand condemned for the record high mortgage interest rates. Under no Government has the rate reached the peaks that it has under this Government.
The Government also stand condemned for the diminished supply of land for house building purposes. They trot out the fact that there are planning approvals for three years' supply. The Minister for Housing and Construction nods. I ask him to talk to the house builders about that. It is no good having land for planning permission if that land is in a
1024
place where people do not want to live or where the infrastructure has not been provided.
We all know that many landowners, apply for planning permission as a matter of interest, to see whether they will get it and whether that will enhance the value of their land. Then the land lies fallow and undeveloped. To rely on those figures is deceiving not only the country but the Government themselves.
If the Government talk to the industry, the house builders and the developers, they will find that since the introduction of the Community Land Act and the development land tax the supply of land has dried up, again because people will not bring forward their land for development purposes voluntarily if they know that at the end of the day they will have to pay a tax of up to 80 per cent. on it.
Moreover, the local authorities do not have the entrepreneurial skills envisaged under the Act to find the land for themselves. Therefore, we have a total land famine and virtually total stagnation because the only land that is now changing hands, at ever-increasing prices, is the land already in stock in hand among builders. One builder is selling to another. That is the land that is changing hands.
Mr. Molloy: The people's land.
Mr. Rossi: The people are certainly not getting homes on it as a result of this policy.
The Government also stand condemned for the increase in house prices, which are now about 60 per cent. above what the Government called the peaks of 1972–73. Twenty-six per cent. of that increase was accounted for only last year.
The Government have a great deal to answer for because of the high expectations they deliberately inflamed before entering office and their lamentable and disastrous performance over the past five years. In 1974 they promised to reverse the serious fall in the house building programme. It has fallen disastrously under them. They promised
" to secure a steady supply of mortgage funds at reasonable rates of interest ".
How people must laugh at that. We have seen high interest rates and the twisting of building societies' arms to stop them lending. We saw all that last year,

1025
as well as the Government's promise to make more money available for the improvement of our older properties. I have already given the House the figures on that.
As my hon. Friend the Member for Northampton, South (Mr. Morris) said in his perceptive speceh, if the Government had only maintained what we were doing when we left office, 250,000 more families would today be living in new homes, and 750,000 extra families would today be living in improved homes. Let alone the promises which they made and did not fulfil, if only they had kept up the programme which we had and which they criticised as inadequate, those million families would be that much better off. However, the day of reckoning is almost nigh, and soon they will have to answer to the electorate for having promised so much and delivered so little. It was with great interest, therefore, that I listened to what the Secretary of State had to offer today.
It is a feature of these periodic housing debates that the Secretary of State seeks to divert attention from his performance by making a promise for the future which may or may never materialise. Last year, it was a housing Bill with a tenants' charter. It is now quite clear that the Bill will never be produced in time to get on to the statute book before a general election. Perhaps that is quite deliberate.
Today the Secretary of State offered easier grants for improvement, which are to be welcomed. It is a great pity that he slashed improvement grants by the amount that I mentioned and disadvantaged the 750,000 families who otherwise would be in improved homes today. But it is gratifying to know that the right hon. Gentleman will reverse that policy. It will be interesting to see how he will restore the cuts and whether he will do it by raising the rateable value limits on the properties which qualify, because these are still far too low, or whether he will remove some of the conditions and restrictions imposed by the local authorities. We shall support him in any of these measures.
It is curious how we get a generalised statement—a promise of good intent—but how very little detail is given telling us how it is to be done in practice. We
1026
wonder whether, as in the past, this is just a smokescreen with no reality behind it.
Then the Secretary of State offered to improve housing estates in the public sector. Again, we were given no details of how it might be achieved. We all know that conditions on many housing estates owned by local authorities throughout the country are deplorable and a scandal and that they should not be in the hands of people who consider and call themselves model landlords. But again the lack of money is at the root of these complaints. So how in practice will the Minister solve the problem? Is it to be just more airy-fairy consultations of the kind that we have seen in the past which produce a great many words but very little action?
We have said time and time again that by his regressive action against the sale of council houses the right hon. Gentleman will make it more difficult for well-intentioned local authorities to improve their existing council estates by denying them the capital and the revenue which the sale of council houses is producing for them at the moment.
The right hon. Gentleman must know that currently the GLC is in credit to the tune of £19 million as a result of its programme for the sale of council houses. I am told that Leeds reckons on improving its housing revenue account by between £200,000 and £300,000 per annum for every 1,000 houses that it sells. That is a great deal of money going into the housing revenue account which then can be used to improve the older estates which need improvement. What is more, as I have said on a number of occasions, in Nottingham, on the sale of the three thousandth council house, the council was £8 million in credit in capital terms and had reduced the deficit on its housing revenue account in terms of the non-mandatory rate fund contributions from £1·2 million in one year to nil in the next. The sale of council houses can transform the financial basis of local authorities and enable them to do to their properties and estates the things that this House is crying out that they should do.
Mr. Neville Sandelson: The hon. Gentleman is very knowledgeable about London housing. Perhaps he will say whether he thinks it right that Hillingdon borough council

1027
should have slashed, virtually by half—if not by more—the number of people on the housing list in spite of the desperate need of people throughout that borough for new housing. Does he think it right that councils should accumulate large sums of money from the sale of council houses when there is this urgent need for the building of new homes for those who need them most?
Mr. Rossi: When the hon. Member for Hayes and Harlington (Mr. Sandelson) starts to talk about council housing waiting lists he should refer to his right hon. Friend the Minister for Housing and Construction, who time and again tells the House that housing waiting lists are no guide at all to housing need in the boroughs. If Hillingdon has gone through its housing waiting list and cut out the dead wood, pinpointing those families which are in real need, it has done a service to its community, and not the opposite. I recommend that exercise to all local authorities.
We all know—especially those of us who have been in local government—that people who go on to a housing waiting list do so for many reasons. The housing need of a large number of them is minimal, and in many cases they remain on the waiting list for many years after they have found accommodation for themselves. Yet the figures remain there. Why? I shall tell the right hon. Gentleman. They remain there as a justification for compulsory purchase orders when the local authority has to go before a public inquiry. We all know that that happens.
The third matter that the Secretary of State mentioned was that he wants to achieve greater mobility in the local authority housing stock. He suggested that he will encourage local authorities to keep a pool of accommodation available for mobility purposes. I wonder how local authorities will be able to keep that pool available, particularly in those areas where they have genuinely large waiting lists and—as in the borough of Hillingdon—are subject to problems created by the Housing (Homeless Persons) Act, where people who may have been in the district for a period as short as six months are given priority for housing need. Where one has local authorities with that kind of problem, how is one
1028
able to justify keeping a supply of empty property in order to achieve mobility between one authority and another? Perhaps the right hon. Gentleman can tell us in practical terms, precisely and in detail, how this will be attained rather than give us generalised statements.
Mr. Frceson: I think that this is a rather pointless exercise. If the hon. Gentleman has had experience of local Government he will know that housing allocations are done on a mixed source basis throughout the year, by many local authorities. Broadly speaking, they can estimate the number of dwellings that they will have by way of relets or new provision month by month throughout the year and are able to calculate the number of places that they can make available. On that basis, if a given number are to be allocated for people moving from another part of the country, those local authorities are perfectly capable of doing that administratively without keeping the properties empty for months on end.
Mr. Rossi: Yes. They will do that by putting further back those people on their general waiting lists as a start.
The fourth matter that the right hon. Gentleman mentioned was the private sector—home ownership—which he tells us he wishes to encourage. He stated that he desires that the local authority rate should reflect the borrowing rate offered by building societies. We have already had that promise from him in the past and we are still waiting for it to be implemented.
In the context of that remark, I was interested in the contribution made by the hon. Member for Gravesend (Mr. Ovenden), because he castigated the building societies roundly and suggested that a Royal Commission be set up to investigate them. One of the reasons he gave was that building societies were charging interest rates much higher than they need. He suggested that they are very responsive when interest rates in the market go up, but slower to react when they come down. Yet here is the hon. Gentleman's own Minister suggesting that local authorities be given the ability to follow the example of the building societies, because, as the Minister knows—even if the hon. Gentleman does not—building

1029
societies are the source of the cheapest form of finance in this country. Indeed, we in this country are very lucky to have a building society movement which has made home ownership available on the scale that it is today.
Mr. Ovenden: Since the hon. Gentleman listened with such great interest to my speech, perhaps he would like to answer the other points that I raised about whether in this day and age we should believe that building societies are the be-all and end-all of housing finance. How does he justify the present level of building society interest rates, taking into account the tax relief that was given to building societies last year? How does he explain the fact that some building societies outside the Building Societies' Association can charge lower rates and have a lower gap between their lending and borrowing rates than societies inside it? Perhaps he would like to go the whole way and answer all those points.
Mr. Rossi: With regard to the last point, one normally finds that building societies outside the association charge marginally higher rates, because they go for a dearer market. They offer better terms and, therefore, they have to lend out at higher terms. That is the general position there, which the hon. Gentleman will discover if he studies the statistics which are available for him to see. Quite honestly, I do not think that the speech he made did him very much credit, because it showed enormous gaps in his understanding and knowledge of that subject.
With regard to local authority lending, there was not a word in the right hon. Gentleman's speech about the drop from £514 million lent by local authorities in 1973–74 to the current level of £155 million. Yet here he was again speaking in terms of platitudes, tears almost coming out of his eyes, saying how necessary it is to help poor people achieve home ownership and to put local authorities in a better position to lend the money by equating interest rates with those of the building societies.
But what about the actual cash available for this purpose? Why has he slashed it by four-fifths between 1973–74 and today? If he reversed that policy he
1030
would give far greater help to people who want to buy in those areas.
The Secretary of State and a number of other hon. Members referred to the Conservative Opposition's policy on the sale of council houses. I take this opportunity to reaffirm that on entering office it is our policy to give all council tenants the legal right to buy their own homes on a freehold basis, if it is a house, or a long lease if it is a flat.
My hon. Friend the Member for Buckingham (Mr. Benyon) asked that we leave this to the discretion of the local authorities. But we did that in the past, and it is clear that the Socialist-controlled authorities, so besotted with the concept of public ownership, will never give their tenants this right. We think it wrong that that right should be restricted geographically to certain people, so that it becomes a matter of accident whether they are given this right. It is, therefore, necessary to deal with this issue on a universal basis.
Labour Members ought to be flattered that, in a sense, we are to extend to council tenants the right which they proudly proclaim they gave to long leaseholders in the private sector in 1967. Just as a long leaseholder in the private sector has the right to enfranchise himself by serving a notice on his landlord, so the council tenant—who is not merely a long leaseholder but a life tenant, even unto the second generation in most cases—will be given this right which the Government saw fit to give to those in the private sector.
We recognise that where the pool of council accommodation is as low as 10 or 11 per cent., particularly in rural districts surrounded by green belt, some special provision will have to be made. We do not say that we shall completely exclude the public sector from making any provision whatever, especially for those in the community who, by definition, cannot help themselves. Here I have in mind the elderly who are unable to obtain a mortgage, the incapacitated, the poor or the single. They must be given help by way of local authority accommodation, and that must be preserved where the problem exists in the terms that I have described.
We must deplore the regressive steps announced today by the Secretary of State

1031
concerning the sale of council houses. His circular will be cancelled the moment we are in office—and that will not be very long. It is merely a hiccup, an interruption in the scheme for council tenants. They need not let the Secretary of State's announcement worry them too much.
The right hon. Gentleman has announced that he wishes to stop the sale of newly built houses for letting. He has not mentioned the fact that there are many councils which, in partnership with developers, are building houses for sale. I understand that this has his blessing. He did not make clear whether his circular will extend to such schemes. Where is the dividing line to be drawn when local authorities are embarking on a scheme? Who is to say whether they intend to build for letting or for sale?
The right hon. Gentleman says that he wants to stop the sale of relets. He condemned local authorities which did that. This is not within the concept of the policy we have announced, because it relates to giving existing council tenants the right to buy their own homes, which is a power local authorities have at the moment, as distinct from a right that we intend to give tenants. There is a great deal to be said for allowing people on the general housing waiting list to have an opportunity of buying those homes rather than letting them.
The right hon. Gentleman said that people who could afford to buy should do so on the private market. Is he saying that people on council waiting lists, if they can afford to buy, should do so on the private market? He made his statement in very robust and general terms. If he is saying that, he is introducing a new concept into housing need. He is introducing financial ability. That may not be a bad thing. If the right hon. Gentleman would like to expand on that, he may find that we are not very far apart. Our concept of council housing is to house those who cannot house themselves, who cannot be expected to house themselves even with a modest amount of help of the kind we intend to give under our grants-for-deposit scheme which we have announced and discussed earlier.
The surplus of housing accommodation has also been mentioned. A survey by the Nationwide building society in 1977 showed a surplus of 830,000 dwellings over households. That would argue that
1032
there is no housing shortage in the country as a whole. The problem is accessibility rather than availability. It is also clear from the debate that much of the empty property, especially in the London area, is in the hands of local authorities. We condemn the authorities which go forward with grandiose schemes of territorial expansion. They municipalise houses everywhere, even outside their boroughs, and then find that they do not have the resources to improve them and bring them into use. They leave them empty for months or years.
The hon. Member for Battersea, South (Mr. Perry) mentioned the problem of empty or unoccupied houses in the private sector. People do not let their houses because they fear that once stuck with a tenant there may be great problems. The Rent Acts must be amended to create what we call shortholds, whereby those properties that are at present unlet and unlikely to be let will be outside the Rent Acts if let on a two or three-year term. People should be given confidence to let properties, which they do not have under present legislation.
I have a number of points still to raise. But I have promised the right hon. Gentleman a certain amount of time to wind up the debate and I hope that the House will forgive me if I leave the matter there.
9.42 p.m.
The Minister for Housing and Construction (Mr. Reginald Freeson): I first wish to correct a myth that is possibly being developed by the hon. Member for Hornsey (Mr. Rossi) and other Conservative Members that all was sweetness, light and marvellous achievement until the dreadful moment in February-March 1974 when the Labour Government came to office, and suddenly everything began to go wrong with the housing programme. It should be remembered, and is by many, that at the end of 1973 and the beginning of 1974 we had the sharpest collapse in private house building for 30 to 40 years. In the boom years about 200,000 new dwellings a year were started, and that dropped to 105,000 dwellings. That was the fact and not the myth.
According to the last White Paper on public expenditure published in 1973 by the Conservative Administration, the projection was that local authority housing starts two years later would run at about

1033
70,000 a year, with the housing associations producing 10,000 to 11,000 additional dwellings, a large number of which were new build and others acquisition and conversion.
Under the previous Labour Government and during the first one or two years of the Conservative Government there was high activity. By 1973, with the general collapse of the boom, there was a major collapse in housing. We had to tackle that during our first few months in office, against the background of the most serious economic crisis to hit the Western world for 50 years. Those are the facts.
During that same period house prices doubled in three years, there was a major mortgage famine, only partially offset by the growth in local authority lending, and 100,000 young prospective first-time purchasers were unable to buy their own homes each year by the time the Tory Government had left office. There were many things to do, as there are still many things to do, in housing.
The first task of this Government was to end that situation as best we could. We did so, despite the most enormous economic difficulties. In the four to five years since that time 1½million new homes have been built, a further 850,000 substandard and near-slum houses have been rehabilitated and converted into new homes, and nearly 800,000 more families occupy good rented homes provided by councils and housing associations. In addition, nearly 800,000 more families own their own homes and the number of first-time buyers has increased from 220,000 a year in the last year of Conservative rule to more than 370,000 a year today. That is the reality which we must set against the distortion that we heard earlier.
Mr. Heseltine Mr. Heseltine rose—
Mr. Freeson: No, I will not give way now. I will give way in a few moments.
Our housing record goes beyond those figures. Despite what is said by the Opposition Front Bench, many Conservative Members agree with many of the things that we have done.
I turn to the Rent Act 1974, which is often trotted out by the Opposition. That Act gave security of tenure to many
1034
thousands of families in furnished flats and rooms who had previously been at risk. That was its objective and that is what it has achieved. The loss of private rented accommodation has nothing to do with the last four or five years. There has been a loss of 100,000 private rented dwellings every year for the past 30 years, and that figure went up to 200,000 a year between 1957 and 1964, when we had decontrol. That was the biggest rate of loss that we ever had in this country. The losses are not peculiar to our years in office; they have been going on for a long time.
Mr. Frank Allaun: Since 1900.
Mr. Freeson: My hon. Friend is quite right—since 1900. We have given security of tenure and we were right to do so.
The Housing Act 1974 gave new powers and resources to councils and housing associations to acquire and modernise old houses. We have initiated a programme of co-operative housing. More than 100 housing co-operatives have been started within the last two years alone, and there are more on the way. The Housing Rents and Subsidies Act 1975 increased resources for house building, municipalisation and rehabilitation by councils. Many thousands of homeless families are now helped by the Housing (Homeless Persons) Act 1977. Last year's Homes Insulation Act provides grants for roof insulation. The Home Purchase Assistance and Housing Corporation Guarantee Act of last year will help about 200,000 first-time home buyers at the lower end of the market each year. It will also increase the resources going into rented housing and housing cooperatives through housing associations.
Mr. Heseltine: In not one single year have the Government achieved the results of the last Conservative Government in every year.
Mr. Freeson: That is not true. Look at the figures in the housing statistics.
Mr. Heseltine Mr. Heseltine rose—
Mr. Freeson: The hon. Gentleman is, I am afraid, a bit of a disaster in housing debates. He should not keep repeating himself in interventions. He should read the Sunday Express as well. Let us turn to some of the issues. [HON. MEMBERS:

1035
" Smear."] We now have a great attendance on the Opposition Benches. They are here to interrupt and to stop the reply to the debate, as usual.
Let us turn to some of the things we have been doing. I will get them on the record, no matter how much shouting takes place in the short time that is available. We have been encouraging a whole variety of new tenures in ways that the Tory Party knew not of when in office. Shared equity, co-operatives, special housing provision for owner-occupiers by way of community leasehold and a whole variety of new initiatives are now common practice among a growing number of housing associations and progressive local authorities.
Reference has been made to our new system of housing strategy and investment programmes. It is against this background of a total approach—not a narrow approach—by local authorities towards housing need that we set out our policy on council house sales. The policy announced by my right hon. Friend earlier this afternoon is a highly principled one which I should have thought would have the support of any person who wants to see housing that is standing empty brought into use to meet housing needs. My right hon. Friend has stated that it is our intention to stop the obscenity—that is what it is—of councils touting empty properties around on the market while people are waiting to be rehoused in areas of housing stress and need. That is the purpose of the policy. I believe it will receive the overwhelming support of people who believe in social housing policy in this country. This Government will have no part in practices indulged in by people who are not concerned to apply principles to housing policy.
I will deal with the issues raised by the hon. Member for Hornsey. He was at pains to criticise us for the reduction in home improvement grants and for the reduction in house building by local authorities. He has called for more money to be put into the operation of the home loans scheme that we announced under the new Act. He wants us to spend more money to raise rateable values, to increase improvement grants, and to improve on assistance to home buyers. He also wants more houses built by local
1036
authorities. He has complained about the reduction.
Even though the hon. Gentleman took up so much time, I am prepared to give way to allow him to tell the House and the country whether it is his intention to increase resources going into public sector housing in order to achieve these objectives. If he is not, he is kidding the House and the country. Does he intend to do so?
Mr. Rossi: A lot depends on the amount of money we find in the kitty when we take office. Our fear is that we will face a Mother Hubbard situation. In any case, our emphasis is on the sale of council houses to release money tied up at the moment doing nothing.
Mr. Freeson: The hon. Gentleman knows that, even if his policy on council house sales ever became law, the rate of such sales under Tory councils is so low that it would not produce the resources which he claims he needs.
Let me go on to another question. If the hon. Gentleman and his hon. Friends believe in getting more done, will he please join us in exhorting local authorities now to spend the resources which we have already made available and which they are not spending? I will gladly give way again if the hon. Gentleman will join us in calling upon all councils to spend the allocations of capital investment that we have distributed in these last few years. There is a serious risk of underspend. There is a serious risk of the programmes not being achieved. I invite the hon. Member for Hornsey or his hon. Friend the Member for Henley (Mr. Heseltine) to join us in calling upon all councils to spend up to the programmes for which they applied and which we distributed.
Mr. Heseltine: I am not prepared to tell the Labour-controlled authorities of Manchester and Sheffield how they should spend the money. I am not prepared to tell Labour-controlled authorities to increase expenditure and place a greater burden on their ratepayers than that already imposed by the Secretary of State.
Mr. Freeson: The hon. Gentleman did not note that I was not asking him to join me in calling upon particular political parties. I asked him to join me in calling upon all local authorities to spend the resources which are already available.

1037
He has refused to do so; he does not want these things done, despite his complaints today. Nor does the hon. Member for Hornsey.
Mr. Molloy: Perhaps the hon. Member for Henley (Mr. Heseltine) will bear in mind that the Tory-controlled council in the London borough of Ealing has cancelled an estate which was designed by the Labour council and has paid the builders £90,000 out of public funds not to build those houses, either for sale or for rent.
Mr. Freeson: That is not unique. Throughout the country, hundreds of thousands, even millions, of pounds are being wasted by councils making those decisions. It is costing the GLC over £1 million a year merely to keep empty properties available for sale. On the GLC's figures, not mine, £1 million has been lost this year simply by doing things that we are aiming to stop.
I am still waiting to hear from the Tory Party what it proposes to do to sustain the programme which its spokesmen themselves criticise as too low. They cannot have it both ways. They cannot com-
1038
plain about the reduction in local authority house building and the failure to switch resources to house improvements and at the same time refuse to call for the use of those resources.
One thing is certain: if the Tory Party ever returned to power there would be a major reduction in investment in housing, led by the hon. Members for Henley and Hornsey. Some of their hon. Friends would deplore their proposals. We have heard some of their speeches today. If they are honest, they know this and they should tell their Front Bench spokesmen to stop denigrating public sector housing activity—a denigration which lies at the centre of their political lives. Millions of people will suffer from that approach. They already are suffering, as a result of the messages of the hon. Member for Henley through Conservative Central Office to Tory councils. I ask both hon. Gentlemen once more: will they please support us in getting these resources spent and thus housing more people?
Question put, That this House do now adjourn:—
The House divided: Ayes 279, Noes 290.

Division No. 821

AYES

0 p.m.

Adley, Robert

Chalker, Mrs Lynda

Fox, Marcus

Aitken, Jonathan

Channon, Paul

Fraser, Rt Hon H. (Stafford&St)

Alison, Michael

Churchill, W. S.

Freud, Clement

Amery, Rt Hon Julian

Clark, Alan (Plymouth, Sutton)

Fry, Peter

Arnold, Tom

Clark, William (Croydon S)

Galbraith, Hon T. G. D.

Atkins, Rt Hon H. (Spelthorne)

Cockcrolt, John

Gardiner, George (Reigate)

Atkinson, David (B'mouth, East)

Cooke, Robert (Bristol W)

Gardner, Edward (S Fylde)

Awdry, Daniel

Cope, John

Gilmour, Rt Hon Sir Ian (Chesham)

Baker, Kenneth

Cormack, Patrick

Gilmour, Sir John (East Fife)

Banks, Robert

Corrie, John

Glyn, Dr Alan

Beith, A. J.

Costain, A. P.

Godber, Rt Hon Joseph

Bell, Ronald

Critchley, Julian

Goodhart, Philip

Bendall, Vivian

Crouch, David

Goodhew, Victor

Bennett, Sir Frederic (Torbay)

Crowder, F. P.

Goodlad, Alastair

Bennett, Dr Reginald (Fareham)

Dean, Paul (N Somerset)

Gorst, John

Benyon, W.

Dodsworth, Geoffrey

Gow, Ian (Eastbourne)

Biffen, John

Douglas-Hamilton, Lord James

Gower, Sir Raymond (Barry)

Biggs-Davison, John

Drayson, Burnaby

Grant, Anthony (Harrow C)

Blaker, Peter

du Cann, Rt Hon Edward

Grey, Hamish

Body, Richard

Durant, Tony

Grieve, Percy

Boscawen, Hon Robert

Dykes, Hugh

Griffiths, Eldon

Bottomley, Peter

Eden, Rt Hon Sir John

Grimond, Rt Hon J.

Bowden, A. (Brighton, Kemptown)

Edwards, Nicholas (Pembroke)

Grist, Ian

Boyson, Dr Rhodes (Brent)

Elliott, Sir William

Hall-Davis, A. G. F.

Braine, Sir Bernard

Emery, Peter

Hamilton, Archibald (Epsom & Ewell)

Brittan, Leon

Evans, Gwynfor (Carmarthen)

Hamilton, Michael (Salisbury)

Brocklebank-Fowler, C.

Eyre, Reginald

Hampson, Dr Keith

Brooke, Hon Peter

Fairbairn, Nicholas

Hannam, John

Brotherton, Michael

Fairgrieve, Russell

Harrison, Col Sir Harwood (Eye)

Brown, Sir Edward (Bath)

Farr, John

Harvie Anderson, Rt Hon Miss

Bruce-Gardyne, John

Fell, Anthony

Haselhurst, Alan

Bryan, Sir Paul

Finsberg, Geoffrey

Hastings, Stephen

Buchanan-Smith, Alick

Fisher, Sir Nigel

Havers, Rt Hon Sir Michael

Buck, Antony

Fletcher, Alex (Edinburgh N)

Hawkins, Paul

Budgen, Nick

Fletcher-Cooke, Charles

Hayhoe, Barney

Bulmer, Esmond

Fookes, Miss Janet

Heath, Rt Hon Edward

Burden, F. A.

Forman, Nigel

Heseltine, Michael

Carlisle, Mark

Fowler, Norman (Sutton C'f'd)

Hicks, Robert

1039

Higgins, Terence L.

Miscampbell, Norman

Shaw, Michael (Scarborough)

Hodgson, Robin

Mitchell, David (Basingstoke)

Shelton, William (Streatham)

Holland, Philip

Moate, Roger

Shepherd, Colin

Hooson, Emlyn

Monro, Hector

Shersby, Michael

Hordern, Peter

Montgomery, Fergus

Silvester, Fred

Howe, Rt Hon Sir Geoffrey

Moore, John (Croydon C)

Sims, Roger

Howell, David (Guildford)

More, Jasper (Ludlow)

Sinclair, Sir George

Howells, Geraint (Cardigan)

Morgan, Geraint

Skeet, T. H. H.

Hunt, David (Wirral)

Morgan-Giles, Rear-Admiral

Smith, Dudley (Warwick)

Hunt, John (Ravensbourne)

Morris, Michael (Northampton S)

Smith, Timothy John (Ashfield)

Hurd, Douglas

Morrison, Hon Charles (Devizes)

Speed, Keith

Hutchison, Michael Clark

Morrison, Hon Peter (Chester)

Spence, John

Irving, Charles (Cheltenham)

Mudd, David

Spicer, Michael (S Worcester)

James, David

Neave, Airey

Sproat, lain

Jenkin, Rt Hon P. (Wanst'd&W'df'd)

Nelson, Anthony

Stainton, Keith

Johnson Smith, G. (E Grinstead)

Neubert, Michael

Stanbrook, Ivor

Jones, Arthur (Daventry)

Newton, Tony

Stanley, John

Jopling, Michael

Normanton, Tom

Steel, Rt Hon David

Joseph, Rt Hon Sir Keith

Nott, John

Steen, Anthony (Wavertree)

Kaberry, Sir Donald

Onslow, Cranley

Stewart, Ian (Hitchin)

Kellett-Bowman, Mrs Elaine

Oppenheim, Mrs Sally

Stokes, John

Kershaw, Anthony

Page, Rt Hon R. Graham (Crosby)

Stradling Thomas, J.

Kimball, Marcus

Page, Richard (Workington)

Tapsell, Peter

King, Evelyn (South Dorset)

Parkinson, Cecil

Taylor, R. (Croydon NW)

King, Tom (Bridgwater)

Pattie, Geoffrey

Taylor, Teddy (Cathcart)

Kitson, Sir Timothy

Penhaligon, David

Tebbit, Norman

Knight, Mrs Jill

Percival, Ian

Temple-Morris, Peter

Knox, David

Peyton, Rt Hon John

Thatcher, Rt Hon Margaret

Langford-Holt, Sir John

Pink, R. Bonner

Thomas, Dafydd (Merioneth)

Latham, Michael (Melton)

Prentice, Rt Hon Reg

Thomas, Rt Hon P. (Hendon S)

Lawrence, Ivan

Price, David (Eastleigh)

Townsend, Cyril D.

Lawson, Nigel

prior, Rt Hon James

Trotter, Neville

Lester, Jim (Beeston)

Pym, Rt Hon Francis

van Straubenzee, W. R.

Lewis, Kenneth (Rutland)

Raison, Timothy

Vaughan, Dr Gerard

Lloyd, Ian

Rathbone, Tim

Viggers, Peter

Loveridge, John

Rees, Peter (Dover & Deal)

Waddington, David

Luce, Richard

Rees-Davies, W. R.

Wainwright, Richard (Colne V)

McAdden, Sir Stephen

Renton, Rt Hon Sir D. (Hunts)

Wakeham, John

McCrindle, Robert

Renton, Tim (Mid-Sussex)

Walker, Rt Hon P. (Worcester)

Macfarlane, Neil

Rhodes James, R.

Walker-Smith, Rt Hon Sir Derek

MacGregor, John

Rhys Williams, Sir Brandon

Wall, Patrick

MacKay, Andrew (Stechford)

Ridley, Hon Nicholas

Walters, Dennis

Macmillan, Rt Hon M. (Farnham)

Ridsdale, Julian

Warren, Kenneth

McNair-Wilson, M. (Newbury)

Rifkind, Malcolm

Weatherill, Bernard

McNair-Wilson, P. (New Forest)

Rippon, Rt Hon Geoffrey

Wells, John

Madel, David

Roberts, Wyn (Conway)

Whitelaw, Rt Hon William

Marshall, Michael (Arundel)

Rodgers, Sir John (Sevenoaks)

Whitney, Raymond

Marten, Neil

Ross, Stephen (Isle of Wight)

Wiggin, Jerry

Mates, Michael

Rossi, Hugh (Hornsey)

Winterton, Nicholas

Mather, Carol

Rost, Peter (SE Derbyshire)

Wood, Rt Hon Richard

Maude, Angus

Royle, Sir Anthony

Young, Sir G. (Ealing, Acton)

Mawby, Ray

Sainsbury, Tim

Younger, Hon George

Maxwell-Hyslop, Robin

St. John-Stevas, Norman

Mayhew, Patrick

Scott, Nicholas

TELLERS FOR THE AYES:

Meyer, Sir Anthony

Scott-Hopkins, James

Mr. Spencer le Marchant and

Miller, Hal (Bromsgrove)

Shaw, Giles (Pudsey)

Mr. Michael Roberts.

Mills, Peter

NOES

Abse, Leo

Brown, Hugh D. (Provan)

Crawshaw, Richard

Allaun, Frank

Brown, Robert C. (Newcastle W)

Cronin, John

Anderson, Donald

Brown, Ronald (Hackney S)

Crowther, Stan (Rotherham)

Archer, Rt Hon Peter

Buchan, Norman

Cryer, Bob

Armstrong, Ernest

Buchanan, Richard

Cunningham, G. (Islington S)

Ashley, Jack

Butler, Mrs Joyce (Wood Green)

Cunningham, Dr J. (Whlteh)

Ashton, Joe

Callaghan, Rt Hon J. (Cardiff SE)

Daiyell, Tam

Atkins, Ronald (Preston N)

Callaghan, Jim (Middleton & P)

Davidson, Arthur

Atkinson, Norman (H'gey, Tott'ham)

Campbell, Ian

Davies, Bryan (Enfleld N)

Bagier, Gordon A. T.

Canavan, Dennis

Davies, Rt Hon Denzil

Barnett, Guy (Greenwich)

Cant, R. B.

Davies, Ifor (Gower)

Barnett, Rt Hon Joel (Heywood)

Carmichael, Neil

Davis, Clinton (Hackney C)

Bates, All

Carter, Ray

Deakins, Eric

Bean, R. E.

Carter-Jones, Lewis

Dean, Joseph (Leeds West)

Benn, Rt Hon Anthony Wedgwood

Cartwright, John

Dell, Rt Hon Edmund

Bennett, Andrew (Stockport N)

Clemitson, Ivor

Dempsey, James

Bidwell, Sydney

Cocks, Rt Hon Michael (Bristol S)

Dewar, Donald

Bishop, Rt Hon Edward

Cohen, Stanley

Doig, Peter

Blenkinsop, Arthur

Colquhoun, Ms Maureen

Dormand, J. D.

Boardman, H.

Conlan, Bernard

Douglas-Mann, Bruce

Booth, Rt Hon Albert

Cook, Robin F. (Edin C)

Duffy, A. E. P.

Bottomley, Rt Hon Arthur

Corbett, Robin

Dunn, James A.

Boyden, James (Bish Auck)

Cowans, Harry

Dunnett, Jack

Bradley, Tom

Cox, Thomas (Tooting)

Dunwoody, Mrs Gwyneth

Bray, Dr Jeremy

Craigen, Jim (Maryhill)

Eadie, Alex

1040

1041

Edge, Geoft

Lamond, James

Roderick, Caerwyn

Edwards, Robert (Wolv SE)

Latham, Arthur (Paddington)

Rodgers, George (Chorley)

Ellis, John (Brig & Scun)

Leadbitter, Ted

Rodgers, Rt Hon William (Stockton)

Ellis, Tom (Wrexham)

Lee, John

Rooker, J. W.

English, Michael

Lestor, Miss Joan (Eton & Slough)

Roper, John

Ennals, Rt Hon David

Lever, Rt Hon Harold

Ross, Rt Hon W. (Kilmarnock)

Evans, Fred (Caerphilly)

Lewis, Kenneth (Rutland)

Rowlands, Ted

Evans, loan (Aberdare)

Litterick, Tom

Ryman, John

Evans, John (Newton)

Lofthouse, Geoffrey

Sandelson, Neville

Ewing, Harry (Stirling)

Lomas, Kenneth

Sedgemore, Brian

Faulds, Andrew

Loyden, Eddie

Selby, Harry

Fernyhough, Rt Hon E.

Lyon, Alexander (York)

Sever, John

Fitch, Alan (Wigan)

Lyons, Edward (Bradford W)

Shaw, Arnold (Ilford South)

Flannery, Martin

Mabon, Rt Hon Dr J. Dickson

Sheldon, Rt Hon Robert

Fletcher, L. R. (Ilkeston)

McCartney, Hugh

Shore, Rt Hon Peter

Fletcher, Ted (Darlington)

McDonald, Dr Conagh

Short, Mrs Renée (Wolv NE)

Foot, Rt Hon Michael

McElhone, Frank

Silkin, Rt Hon S. C. (Dulwich)

Ford, Ben

MacFarquhar, Roderick

Silverman, Julius

Forrester, John

McGuire, Michael (Ince)

Skinner, Dennis

Fowler, Gerald (The Wrekin)

McKay, Allen (Penistone)

Smith, Rt Hon John (N Lanarkshire)

Fraser, John (Lambeth, N'w'd)

MacKenzie, Rt Hon Gregor

Snape, Peter

Freeson Rt Hon Reginald

Maclennan, Robert

Spearing, Nigel

Garrett, John (Norwich S)

McMillan, Tom (Glasgow C)

Spriggs, Leslie

Garrett, W. E. (Wallsend)

Madden, Max

Stallard, A. W.

Georage, Bruce

Magee, Bryan

Stewart, Rt Hon M. (Fulham)

Gilber, Rt Hon Dr John

Mahon, Simon

Stoddart, David

Ginsburg, David

Mallalieu, J. P. W.

Stott, Roger

Golding, John

Marks, Kenneth

Strang, Gavin

Gould, Bryan

Marshall, Dr Edmund (Goole)

Strauss, Rt Hon G. R.

Gourlay, Harry

Marshall, Jim (Leicester S)

Summerskill, Hon Dr Shirley

Graham, Ted

Mason, Rt Hon Roy

Taylor, Mrs Ann (Bolton W)

Grant, George (Morpeth)

Maynard, Miss Joan

Thomas, Jeffrey (Abertillery)

Grant, John (Islington C)

Meacher, Michael

Thomas, Mike (Newcastle E)

Grocott, Bruce

Mellish, Rt Hon Robert

Thomas, Ron (Bristol NW)

Hamilton, W. W. (Central Fife)

Mikardo, Ian

Thorne, Stan (Preston South)

Hardy, Peter

Millan, Rt Hon Bruce

Tierney, Sydney

Harrison, Rt Hon Walter

Miller, Dr M. S. (E Kilbride)

Tilley, John

Hart, Rt Hon Judith

Mitchell, Austin (Grimsby)

Tinn, James

Hart, Rt Hon

Molloy, William

Tomlinson, John

Hattersley, Rt Hon Roy

Moonman, Eric

Tomney, Frank

Hayman, Mrs Helene

Morris, Alfred (Wythenshawe)

Torney, Tom

Healey, Rt Hon Denis

Morris, Rt Hon Charles R.

Tuck, Raphael

Heffer, Eric S.

Morris, Rt Hon J. (Aberavon)

Urwin, T. W.

Home Robertson, John

Morton, George

Wainwright, Edwin (Dearne V)

Hooley, Frank

Moyle, Rt Hon Roland

Walker, Harold (Doncaster)

Horam, John

Mulley, Rt Hon Frederick

Walker, Terry (Kingswood)

Howell, Rt Hon Denis (B'ham, Sm H)

Murray, Rt Hon Ronald King

Ward, Michael

Hoyle, Doug (Nelson)

Newens, Stanley

Watkins, David

Huckfield, Les

Noble, Mike

Watkinson, John

Hughes, Rt Hon C. (Anglesey)

Oakes, Gordon

Weetch, Ken

Hughes, Mark (Durham)

Ogden, Eric

Weltzman, David

Hughes, Robert (Aberdeen N)

O'Halloran, Michael

Wellbeloved, James

Hughes, Roy (Newport)

Orbach, Maurice

White, Frank R. (Bury)

Hunter, Adam

Orme, Rt Hon Stanley

White, James (Pollok)

Irving, Rt Hon S. (Dartford)

Ovenden, John

Whitehead, Phillip

Jackson, Colin (Brighouse)

Owen, Rt Hon Dr David

Whitlock, William

Janner, Greville

Padley, Waller

Willey, Rt Hon Frederick

Jay, Rt Hon Douglas

Palmer, Arthur

Williams, Rt Hon Alan (Swansea W)

Jeger, Mrs Lena

Park, George

Williams, Alan Lee (Hornch'ch)

Jenkins, Hugh (Putney)

Parker, John

Williams, Rt Hon Shirley (Hertford)

John, Brynmor

Parry, Robert

Williams, Sir Thomas (Warrington)

Johnson, James (Hull West)

Pavitt, Laurie

Wilson, Rt Hon Sir Harold (Huyton)

Johnson, Walter (Derby S)

Pendry, Tom

Wilson, William (Coventry SE)

Jones, Alec (Rhondda)

Perry, Ernest

Wise, Mrs Audrey

Jones, Barry (East Flint)

Phipps, Dr Colin

Woodall, Alec

Jones, Dan (Burnley)

Price, C. (Lewisham W)

Woof, Robert

Judd, Frank

Price, William (Rugby)

Wrigglesworth, Ian

Kaufman, Rt Hon Gerald

Radice, Giles

Young, David (Bolton E)

Kelley, Richard

Rees, Rt Hon Merlyn (Leeds S)

Kerr, Russell

Richardson, Miss Jo

Kilroy-Silk, Robert

Roberts, Albert (Normanton)

TELLERS FOR THE NOES:

Kinnock, Neil

Roberts, Gwilym (Cannock)

Mr. James Hamilton and

Lambie, David

Robertson, George (Hamilton)

Mr. Donald Coleman.

Lamborn, Harry

Robinson, Geoffrey

Question accordingly negatived.

HOVERCRAFT (CIVIL LIABILITY)
10.18 p.m.
The Under-Secretary of State for Trade (Mr. Clinton Davis): I beg to move,
That the draft Hovercraft (Civil Liability) Order 1979, which was laid before this House on 19 February, be approved.
Although this order is intended to replace the Hovercraft (Civil Liability) Order 1971, the changes which it makes to the provisions of that earlier order are relatively few and restricted in scope. But, because of the necessarily complex and lengthy nature of the 1971 order and the many detailed amendments which are in consequence required to it, a completely new order has been prepared in the interests of convenience and clarity.
As hon. Members may know, the purpose of the 1971 order, which, like the present order, was made under section 1 of the Hovercraft Act 1968, was to establish the nature and extent of civil liability in respect of the carriage of cargo, passengers and baggage by hovercraft and in respect of third party liability arising in relation to hovercraft.
Thus, the 1968 Act and the 1971 order make provision, first, for a modified version of the Carriage by Air Act 1961 and the Carriage by Air (Supplementary Provisions) Act 1962 to apply to liability in the carriage of passengers and their baggage by hovercraft; secondly, for a modified version of the Carriage of Goods by Sea Act 1924 to apply to liability for cargo carried by hovercraft; and, thirdly, for a modification of part VIII of the Merchant Shipping Act 1894, as amended, to apply to a hovercraft owner's or operator's overall liability for causing personal injury or death or property loss or damage.
In the past eight years there have been two main developments that make amendments to the 1971 order desirable, though without changing the general approach adopted by that instrument. First, inflation and the revised limits of liability that apply under the original maritime or aviation statutes make the various limits of liability established by the 1971 order too low and out of date. Secondly, new legislation that has come into force since 1971 needs to be taken into account.
1044
I shall briefly explain the main changes made by the new order. The 1971 order applied to hovercraft the liability for passenger rules of international carriage by air, but with a standard per capita limit of liability for death or personal injury of £12,000. That was because at the time ship owners were able to exclude contractually all liability towards passengers—a situation which it was not thought should apply in relation to hovercraft.
The £12,000 limit did not, however, derive from the aviation example. It was merely a figure which was considered at the time to be fair to hovercraft operators and passengers alike. The new order simply increases that limit to £30,000 to compensate for inflation since 1971. It is perhaps relevant to note that, as a result of the Unfair Contract Terms Act, ship owners can no longer contract out of all liability to passengers, though they are allowed to limit it to slightly more than £30,000 per capita.
The increase made by the new order will also effectively implement the immediate recommendation on hovercraft limits of liability of the Royal Commission on civil liability and compensation for personal injury—the Pearson Commission. That is the situation on international carriage, but it is different in relation to domestic carriage, for which the order does not introduce the higher limit suggested by the Pearson Commission.
For the longer term, the Commission envisaged the application of the limit in the Warsaw Convention as it will be amended by Montreal Protocol No. 3. The Commission assumed that air law should remain the basis of the carriage of passengers by hovercraft—an assumption which is open to considerable doubt. The legal committee of IMCO may shortly consider a preliminary text of a draft international agreement relating to the carriage of passengers and their baggage by hovercraft which is based on the provisions of a new convention on ship owner's liability for the death of or injury to passengers, namely, the 1974 Athens Convention. It would seem sensible not to prejudice our possible future application of the draft international agreement if, after consideration by the IMCO legal committee, it remains based on maritime law. I hope that the House

1045
will feel that that is an appropriate course.
Two amendments are made to the provisions of the 1971 order in respect of liability for passengers' baggage. The limitations for baggage in the 1971 order were identical to those applying in the United Kingdom to air transport, namely, £138 per passenger for baggage in the passenger's charge and £7 per kilogram for registered baggage. Those limits have since increased by about 50 per cent. while the limits for hovercraft under the 1971 order have remained unchanged. In addition, doubts have been expressed since 1971 about whether the air law distinction between registered baggage and baggage in the charge of a passenger is applicable to hovercraft where items handed over by the passenger on embarkation are not normally weighed.
To deal with those two matters, the new order increases the hovercraft limit of liability for baggage in the charge of a passenger to £216, so that it again accords with that applicable in carriage by air and establishes a separate and additional limit of £216 for other baggage, replacing that which now applies to registered baggage.
I turn now to cargo liability. The rules in the 1971 order for goods on board a hovercraft were based on the Carriage of Goods by Sea Act 1924. That Act implemented in the United Kingdom an international maritime agreement on the subject known as the 1924 Hague Rules. However, in June 1977 the 1924 Act was superseded by the bringing into force of the Carriage of Goods by Sea Act 1971, which gives effect to a protocol to the 1924 Hague Rules. It is therefore only sensible that the 1971 order should now be amended to reflect the changes that have resulted from the Carriage of Goods by Sea Act 1971 entering into force.
Finally, there is global limitation, the overall ceiling on liability in respect of all claims which may arise from an incident, although under both the 1971 order and this new order that overall liability limit does not include claims in respect of death or injury to passengers on board the hovercraft itself, or for loss of or damage to their baggage. But the global limitation figures which apply
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to ship owners, and upon which the corresponding 1971 hovercraft limits were based, have increased by over 50 per cent. since 1971. This order simply increases the hovercraft limits in the same proportion.
I hope that the House will approve the order, which does not depart from the principles established in the 1971 order but merely brings that order up to date in certain limited respects. In so doing, I particularly emphasise and commend to the House the substantially increased protection that the new order will accord to hovercraft passengers.
10.26 p.m.
Mr. David Hunt (Wirral): Although the order is a technical provision, it is very important. It gives the House an opportunity to look at hovercraft travel over the period since the previous order was made. Looking back over the past 10 years, one sees that the number of passengers and the number of cars carried by hovercraft have greatly increased. Whereas 10 years ago Hoverlloyd carried 36,000 cars annually, it now carries a quarter of a million. Compared with the 300,000 passengers it carried 10 years ago, it now carries 1¼ million every year. Sea-speed carries about three-quarters of those numbers of cars and passengers.
I believe that what has happened over those years has justified the original decision to treat the hovercraft as a vehicle sui generis and to apply each rule, order and provision relating to ships, aircraft or motor vehicles only if it is applicable.
However, other countries have not been so far-sighted. France, for example, has sought to treat the hovercraft as a ship, and in doing so has encountered a great deal of difficulty. Although we are not dealing with that subject tonight, one example of the problems lies with the French treatment of port and harbour dues according to tonnage, which is causing our operators some problems.
The order is a very important measure, dealing as it does with civil liability. I take issue with the Minister over the amount of consultation that has taken place. I understand that the main operators have been consulted, but they have expressed some concern to me—I cite Hoverlloyd in particular—about the lack of any response to the consultation. Hoverlloyd has shown me a letter that

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it wrote to the Department of Trade on 12 May 1978 making a number of very important points about the draft, not one of which appears to have changed the draft. It received no communication in reply. It would be helpful if the Minister could indicate that the points raised by Hoverlloyd and Seaspeed will be dealt with in correspondence.
Having made the right decision, so that since 12 July 1972 a hovercraft has not been treated as a ship, motor vehicle or aircraft, but as an air-cushion vehicle, we must get the balance right. As the Minister has explained, the order is based on the practice of using the Carriage by Air Acts for liability for carriage of passengers and baggage and the Carriage of Goods by Sea Act for liability for carriage of cargo.
Under the order, there are to be substantial increases in liability for hovercraft operators. This is perhaps an appropriate moment to point out something that the Minister did not mention, namely, that as well as applying the different principles of liability in the amounts involved, doing it in this way introduces differing principles of liability.
Kovats, who has written what is described as the bible on the law of hovercraft, points out the difficulties of doing it in this way. I wonder whether the Minister is wedded totally to the principle, or whether he is still considering it. Kovats says:
" By introducing the concept of wilful misconduct (which is based on intentional wrongdoing) from air law, while leaving unaffected the rules relating to negligence (which are based on reasonableness) and limitation of liability (which are based on fault and privity) applied in maritime cases, the legal analysis of a single act or omission on the part of one and the same person "—
albeit in respect of differing liabilities—
" will pose innumerable difficulties to all whose task will be to fix the incident of liability where it should lay."
That is very important, of course.
Returning to the amounts involved, I wish to put three matters to the Minister. First, while I recognise that in 1971 the limit of liability for injury to or death of passengers was fixed at £12,000 and therefore, of course, there must be a review, in my view the increase to £30,000 is very substantial. Despite the Government's mismanagement of the economy.
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that is not related wholly to inflation. It represents a positive increase. Operators believe that it will place them at a competitive disadvantage with ship owners.
Under SI No 1468 of 1978 ship owners may limit liability to £30,390·8, but they have the benefit of an overall limitation of liability. I refer to representations which have been made by the British Hovercraft Corporation Ltd.—and I had the opportunity of speaking today to Mr. Stanton-Jones, the managing director. It believes that the lack of an equivalent overall limitation of liability places the hovercraft operator at a considerable disadvantage. In putting his case, Mr. Stanton-Jones included the existing limit, which is £130 per gross ton of the ship involved. He gave an example of an N4 mark 2 hovercraft with 280 passengers and 30 cars, where the limit of liability under this order and its new provisions will be £8· 5 million, whereas a typical cross8· Channel ferry with a gross weight of 2,400 tons carrying 1,200 passengers and 155 cars will have a maximum liability of £310,000. At first sight, unless the Minister can explain why he wants this order to come into force on 1 April, that would seem to be a very serious disadvantage.
Even if the London Convention 1976 is ratified in relation to ships, a ship owner will still have an overall limit of approximately £17 million. As the Minister knows, we have been discussing the London Convention in our debates in Committee on the Merchant Shipping Bill. But even though it reaches that limit, there are still competitive disadvantages.
It was as long ago as 28 November 1977 that Hoverlloyd put a case to the Department, and it has not had a response to its case as yet. It cited as an example the motor vessel "Earl Siward", which is in regular service on the short sea route, with a gross tonnage of 3,602 and a net registered tonnage of 1,217. The approximate global limitation for total liability for that vessel would be £230,000, whereas even on the present liability figure of £12,000 for hovercraft passengers, where there is no overall liability limitation, a hovercraft has to carry only 20 people before its total liability is greater than that of a ship the size of the "Earl Siward". I should be grateful

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if the Minister would respond to the very serious contentions put forward by Hoverlloyd and the industry. Assuming a cross8· Channel ship to have a capacity of 1,000 passengers, even under the London Convention 1976 the per capita limit will be £17,000, whereas he is proposing a figure of £30,000 for hovercraft operators.
The Minister mentioned the Pearson Commission report. That Commission suggested that there should be a two8· tier system of liability, with a separate limit of £37,700 for journeys within the United Kingdom. That met with hostility from the industry, and it will be helpful if the Minister will confirm that he has rejected that approach, that so far as he is concerned he will stay with the £30,000 limit for all journeys and that no reconsideration in the light of Pearson is continuing at the present time.
The third point relates to baggage. Again, this will place the hovercraft operator at a disadvantage compared with airlines because it assumes that, with a limit of £216 per item of registered luggage, each item weighs 20 kilograms. But that is totally inaccurate, as Hoverlloyd's research shows that the average weight per item is 10 kilograms. Why is there difficulty in determining the difference between hand baggage and registered baggage? This is a point that concerns the industry. Can the Minister explain why he cannot simply define registered baggage as that which has been handed into the care of the operator? I know that there is no checking8· in, as there is with an airline, but baggage is handed into the custody of the operator. Surely that gives a reason why a particular definition can be taken in that context.
I should like to raise a further point in relation to cars. Under article 5 (b)
" a vehicle and its contents shall not be treated as baggage ".
I know that Seaspeed—British Rail Hovercraft Ltd.—has put forward a contention to the Minister that it believes his Department has missed an opportunity to rectify an anomaly over liability for motor cars. Ship ferries are governed by the Athens Convention, which lays down a limit of liability for cars of £2,170. This order clearly states that cars are not baggage, but it does nothing to lay down a limit for operator's liability. Perhaps the
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Minister will confirm that as a vehicle and its contents will not be treated as baggage they immediately fall into the cargo definition.
If that is the case, one then looks at the Carriage of Goods by Sea Act and sees that it operates by reference to a bill of lading. A bill of lading in relation to hovercraft operation does not have any relevance. A passenger does not negotiate a bill of lading with the hovercraft operator, yet if the operator wishes to incorporate the provisions of the Carriage of Goods by Sea Act he has to have a bill of lading or something equivalent. Perhaps the Minister will explain whether he is reconsidering the application of the Carriage of Goods by Sea Act in that context, because on the one hand he is making a substantial addition to the definition of cargo by treating all vehicles and their contents as cargo. But he is not, on the other hand, making the task any easier for the hovercraft operator by simplifying the definition and, indeed, the relevance of the Carriage of Goods by Sea Act.
The Minister referred to the IMCO Convention. As I understand the position, hovercraft were excluded from the Athens Convention in 1974 by a United Kingdom initiative, because the International Institute for the Unification of Private Law was studying a separate convention. I presume that this must be the draft convention to which the Minister referred, which is shortly to be discussed through IMCO.
As I understand it, that convention brings in a new definition, namely, "luggage", which would obviously require some reconsideration of the provisions of this order. I wonder whether the Minister could explain how he intends to consult the industry over this IMCO convention. Will he do it just through the hovercraft committee of the Air Regulation Board or does he propose to initiate a series of discussions with the operators and other interested bodies? The interested bodies, for instance the United Kingdom Hovercraft Society, would probably have some valuable contributions to make to the IMCO deliberations.
Seaspeed makes the point, which I understand it made to the Department, that we have a new Merchant Shipping Bill and that there is a new carriage by air and road Bill on the stocks. There

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are obviously things in both those Bills which will affect hovercraft liability, and therefore this order will surely have to be amended before it has been in existence for long. Seaspeed has felt strongly that it would have been better to have those two Bills out of the way before making the order effective. As it is eight years since the previous order was made it would not, in its opinion, have been wrong to have waited a bit longer.
The United Kingdom Hovercraft Society has also posed the question, which rather summarises my remarks: what are the different limits of liability for hovercraft, aircraft, ships and hydrofoils? We seem to be setting up a regime where there are different limits of liability for each of these vessels and craft, which adds to the complexity of existing law, particularly for passengers. What consideration is being given to reaching a unified approach on these issues? It would be helpful if the Minister could—if not now, in a letter, so that I can pass it to the various bodies which have been in touch with me—give an analysis of the differing limits of liability so that representations can be made on them.
Many of my points tonight have referred to the urgency to get the balance right when trying to incorporate these different regimes. We are talking more about the level of insurance premiums than anything else, because we must be aware of the industry's safety record. But insurance premiums contribute substantially to the competitive structure within which hovercraft operate. We have every right to be proud of the achievements of the United Kingdom in the manufacture and operation of hovercraft. We must ensure that we do not impose an unfair burden on this important sector.
10.43 p.m.
Mr. Stephen Ross: I begin my speech where the hon. Member for Wirral (Mr. Hunt) ended. I congratulate the hon. Member on his research. He has become knowledgeable in an area in which I did not know he was expert. I at once confess that I know very little about the subject. I am concerned because the British Hovercraft Corporation Ltd. employs 2,200 of my constituents and is, therefore, the largest employer of labour on the Isle of Wight,
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with the exception, I am afraid, of the Isle of Wight county council, which I suppose we have to expect.
As the hon. Member for Wirral has rightly pointed out, the hovercraft has a marvellous safety record. I can think of only one fatal accident, which occurred off Ryde in rough weather. That accident was a tragedy which never should have happened. There may well have been another occurrence, but I cannot think of it.
I feel that this British technical invention has not had enough support from the Government. The hovercraft in which I travel across the Solent—and I know of only those two routes, plus the cross-Channel routes, which are operated regularly in this country—were built 10 or more years ago. Even the SRN 4, the Earl Mountbatten of Burma class, which operates from the constituency of the hon. and learned Member for Dover and Deal (Mr. Rees), is a stretched craft. It was originally built in the late 1960s and has had the middle chopped out and an extra bit put in. It is a great success and we in the Isle of Wight are thrilled with it. We are doing the second one for Seaspeed. But the fact is that we ought to have developed much further. We should be in the next stage of these craft, where they would be competitive with merchant shipping. We demonstrated that in the House some two or three years ago.
New opportunities are opening up in Alaska and China. My constituents and the managing director of the British Hovercraft Corporation Ltd. are somewhat incensed that when the Chinese are over here they seem to be directed to subsidiaries of British Shipbuilders—nationalised companies—and Vosper Thorneycroft in particular, which is a real tiddler in the production of hovercraft—while BHC is generally left out of the picture, although now I gather that it is back in it. But as it is the manufacturer of virtually every craft, except for the French craft which are operating across the Channel, it is nonsensical not to give it every opportunity to get in on the area of operation now opening up in China. I have a feeling that hovercraft will be of use to China, and I am pleased also that in Alaska the Jones Act, which had the effect of stopping operations in

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Alaska, has been conceded for five years. That allows British operators to get into the Alaskan market, too.
I am concerned that this order will put hovercraft at a grave disadvantage in comparison with ships. At a time when they are struggling to continue to keep ahead, this additional blow may persuade some of the operators—there are only three that I know of in this country, Hoverlloyd, Seaspeed and Hover Travel, which is based in my constituency—that it is no longer a viable possibility to continue to operate.
I have confirmation of some of the figures quoted by the hon. Member for Wirral. Under the Merchant Shipping Bill, some of the liability for cover for merchant ships is being substantially increased. If the figures given to us by the managing director of British Hovercraft are correct, it seems to me that the company is being put at a considerable disadvantage. Is this necessary in view of the very limited operations of these craft? Their operations have not expanded at anything like the rate which we would have expected. They have not had anything like the encouragement that they should have had. We are passing a very lengthy document here for a very small number of hovercraft operating in this country. Is it really necessary to land them with such heavy overheads?
10.48 p.m.
Mr. Clinton Davis: The hon. Member for Wirral (Mr. Hunt) asked me about consultations. My understanding of the situation was that all the points that had been raised by the hovercraft operators were fully considered. Indeed, a copy of the draft order was submitted to them last week, and my understanding was that the points they had raised were substantialy covered in this order as we are now considering it. If they wish to raise any specific matters, of course I shall deal with them by way of correspondence, but, to the best of my recollection, they have not written to me about the situation. I shall certainly consider what the hon. Gentleman has said, and perhaps the hovercraft operators will do likewise if they wish to raise any particular matters beyond those which have been canvassed in the House.
The hon. Member for Wirral asked whether we would be considering longer-
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range changes in the concept of liability. I indicated in opening the debate that the order did not dramatically affect the situation. It is merely a reflection of developments since the 1971 order and is, therefore, limited. Longer-term thinking should be undertaken in the light of the changing international scene, not least the current deliberations in the IMCO legal committee—to which I referred earlier. It would be premature to embark on a substantial change prior to the conclusion of those deliberations, and it is unlikely that IMCO will come forward with a convention for some years. It is impossible to predict how long that will take.
The hon. Member for Wirral thought, as did the hon. Member for Isle of Wight (Mr. Ross), that hovercraft operators would be prejudiced by the changes in relation to operators of ships and, to some extent, aircraft. But perhaps we should consider the comparison with ships rather than aircraft. The British Insurance Association has examined this from an insurance point of view. Its advice is that, even with the increase from £12,000 to £30,000 per passenger, the resultant increased insurance premiums will probably only have a slight effect on fares. The grave disadvantages which the hon. Member for Isle of Wight mentioned are confuted by that assertion.
The hon. Member for Wirral asked about the non-application of the global limitation to hovercraft passenger claims. A difference will exist under the new order, but that is so under the 1971 order and is nothing new. That order was made at a time when ship owners were able contractually to exclude all liability towards passengers. Exclusion of passenger claims from a hovercraft operator's global liability, however, continues to be desirable to ensure that compensation available to passengers is not significantly reduced by other claims. The present position of ship owners being able to include passenger claims within their ordinary global limitation amounts will end once the 1976 London Convention comes into force.
The hon. Member for Wirral went on to question the basis of the rules whereby a comparison is made with ships. The measurement rules by which a ship's tonnage is assessed cannot easily be applied to hovercraft. The global limitation calculation for hovercraft is derived from a

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comparison of the values of ships and hovercraft. That was the subject of detailed study before the making of the 1971 order. The new order does not change that.
I thought that I had made the position on the Pearson Commission quite clear. The Government are not taking up the matter of the rules relating to liability in the domestic regime.
The question of cars has been raised. The new order does not change the treatment of vehicles at all. It specifies that vehicles and their contents are not to be treated as passengers' baggage. On the other hand, if a vehicle were carried under a bill of lading or some similar document the cargo liability provisions of the order would apply. Otherwise, any contract for the carriage of a vehicle by hovercraft would be subject to the general rules of law, and loss or damage to the overall limitation provisions of the order. Any alteration in this can properly await the more fundamental review of the whole of the hovercraft civil liability provisions, and it would be premature to embark upon that now.
Mr. Peter Rees: This is obviously a matter of concern for those operating from my constituency. Is the Minister indicating that a major review will be undertaken by his Department? If so, when, and when is it likely to report? Also, what will be the terms of reference?
Mr. Davis: The major review is in the hands of IMCO initially. I was asked earlier about the nature of the consultations that will flow from that. It is far too early to judge how we would want to go about consulting. This is a matter that will probably take place in 1981 or thereabouts. It would be wrong for me to enter into any commitments now. Although some criticism has been made of the adequacy of consultation in this case—and I shall investigate that because that was not my understanding—it is the Department's general policy to consult widely. Should there be occasions when deficiencies have occurred in this respect, I shall do my best to ensure that they are put right. I am sure that my officials will have noted very carefully what has been said in the House tonight.
On the question of differing limits of liability, it would be useful to have these
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set out in writing because there is a measure of confusion. This matter will be put right only when the fundamental review has been carried out. I shall certainly write to the hon. Member for Wirral. I cannot give him a time scale for this because the matter may need a certain amount of research, but I shall try to do it as soon as possible. I agree that this is a little bewildering on occasions.
I share the views expressed by the hon. Member for Isle of Wight about the very remarkable record, not simply in terms of safety but in terms of initiative and enterprise, that has resulted from the development of the hovercraft in this country. It is a superlative example of ingenuity. Whether we have made the best use of it is a matter that goes far wider than the terms of tonight's debate.
All I can say about the Chinese interest is that I am not a Trade Minister as such, but I shall draw this matter to the attention of my ministerial colleagues in my Department and the Department of Industry. I should be very surprised if every attempt had not been made to interest people overseas in this product. I gather that if there has been any sort of oversight here, it has all been put right and that the Chinese may be as interested in this as they are in certain other matters.
Question put and agreed to.
Resolved,
That the draft Hovercraft (Civil Liability) Order 1979, which was laid before this House on 19 February, be approved.

HOSPITALS (MIXED SEX WARDS)
Motion made, and Question proposed, That this House do now adjourn.—[Mrs. Ann Taylor.]
10.58 pm
Mr. David Atkinson: I am pleased to have the opportunity to raise a matter which has caused considerable concern to many people, namely, the problem of mixed wards in hospitals.
This may not be the most appropriate time for such a subject to be raised when there are over-long hospital waiting lists further aggravated by industrial action by hospital staff. One could argue that patients should count themselves fortunate to be offered any bed in any ward at this

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time. Nevertheless, there is growing evidence to suggest that the trend towards mixing the sexes in hospitals is taking place today at a speed and in a manner which is not wholly acceptable to the public, as the Minister will know from his own correspondence and from reports which he will have received from community health councils throughout the country.
I am aware that the practice of mixing the sexes in hospitals is not new. It applies to many, if not most, of our hospitals. Some good reasons exist for it. I do not object to them in principle. Mixed wards offer a more flexible system of management of hospital accommodation and a more efficient use of our resources, manpower and equipment, particularly with regard to intensive care units where patients are far too ill to be concerned about the company they are keeping. I agree that positive therapeutic advantages exist as a result of the socialising that it encourages, which helps to stimulate morale and thus provides for a more rapid recovery. In hospitals for the mentally ill, in particular, it provides a positive aid to rehabilitation.
The fundamental point is that entry into such a ward must remain for all time a matter of personal choice. That must be the prime criterion. There exists today worrying evidence that this is not always being applied. There is a real and growing fear and outrage that the proliferation of mixed wards will, in due course, eliminate any margin of personal choice.
Moreover, there are reports, which I believe the House cannot ignore, that, where sexes are mixed, in some hospitals conditions are being experienced and standards are being applied which constitute an affront to human dignity and which cannot be tolerated. Such a situation deserves the fullest investigation and consultation with area health authorities and, through them, the general public before we can allow the trend towards more mixed sex wards in our hospitals to continue.
Last October my local community health council in East Dorset received and discussed a paper on this matter which referred to the fact that
" Mixed units and wards are being introduced into specialties such as orthopaedics and geriatrics, where it is unacceptable for a num-
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ber of reasons. Firstly, there is no preadmission warning that patients will be entering a mixed ward or unit. Secondly, there is no choice for patients between mixed and non-mixed wards. Thirdly, some patients experience acute embarrassment performing toilet procedures in mixed wards. Fourthly, geriatric patients are expected to perform toilet procedures in mixed day rooms without adequate privacy, resulting in a loss of dignity for these patients. Finally, elderly female patients may be sensitive and upset by the sight of confused male patients wandering about mixed wards and day rooms partially or totally unclothed."
I understand that a petition sharing the local community health council's concern about mixed wards is currently attracting hundreds of signatures in my constituency.
Last year, the Association of Nursing Practice, which is part of the Royal College of Nursing, concerned about the development of mixed wards, and after seeking evidence through the medium of the Nursing Standard in order to present a view representative of its profession, reached the conclusion that
" patients' attitudes, beliefs and wishes in this matter are not being taken into account and in some instances are even being disregarded."
Also last year, the Health Service Commissioner upheld the complaint of a woman patient that privacy was inadequate in the mixed ward to which she had been admitted and said that he was not satisfied that adequate provision was made in the hospital concerned for those who found the arrangement distasteful.
A number of gruesome reports have appeared in the press or have otherwise come to light of violence and other disturbing behaviour in mixed wards, which would be intolerable by any standards and which I hope will always be subject to the most vigorous investigation whenever they appear.
Since it became known that I was to raise this matter tonight I have received many letters, from men as well as women, from young people as well as from the elderly, and not just from my own constituency—and I would not judge any of them as prudes. All the people who have written to me, save one, express gratitude that at last these problems and concerns are being brought to the attention of the House.
Many of them refer to their own experiences in hospital, stressing that never again would they be prepared to be

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treated in a mixed ward. Some even go so far as to say that they would refuse a hospital bed if it meant that they could not exercise freedom of choice of ward. One can understand their views when all they seek in entering hospital is to try to get well with maximum personal privacy and the preservation of human dignity.
Where there exists between beds nothing but scant screens or semi-transparent curtains, few patients are unlikely to be embarrassed or offended on being overheard discussing, or overhearing discussions on, intimate problems with a doctor or nurse, or by every sound associated with the calls of nature. I do not know whether men are prone to snore more uncontrollably than women or whether women are prone to chat more unceasingly than men, but if one is feeling really low it is a little late to find out from the behaviour of one's neighbour when one has opted for a mixed sex ward.
These are details which some doctors and health officials, and even some politicians, may regard as trivial in comparison with the major problem of a lack of hospital beds. Nevertheless, the House should accept that the practice of mixing the sexes in our hospitals against the wishes of the majority of patients smacks of expediency and is providing a second-best service.
Therefore, I ask the Minister to assure us, first, that no patient will enter a mixed ward without being given a choice and being adequately informed of the conditions and circumstances involved; secondly, that when a patient opts for a single sex ward there will be no threat of delay in treatment; and, thirdly, that where mixed wards exist, adequate partitions will be provided to maintain privacy. I should be glad to know whether minimum standards are laid down by the Department, and, if so, whether they are enforced.
Finally, will the Minister agree now to embark upon a process of consultation with every area health authority on the whole question of mixing the sexes in hospitals, to review the evidence of the problems that have arisen and to ask every community health council to seek and to discuss the views of the public, the consumer whom the hospital is there to serve?
11.10 p.m.
Mr. Tom Normanton rose—
Mr. Deputy Speaker (Mr. Bryant Godman Irvine): Has the hon. Gentleman asked the permission of the hon. Member for Bournemouth, East (Mr. Atkinson) to intervene?
Mr. Normanton: Yes, Mr. Deputy Speaker.
Mr. Deputy Speaker: Very well.
Mr. Normanton: I should like to thank my hon. Friend the Member for Bournemouth, East (Mr. Atkinson) for allowing me to add briefly to his valuable contribution. I do so in the interests not of party political issues but of important social ones.
I wish to reinforce my hon. Friend's comments, and in view of the lateness of the hour I shall do so briefly. I recall the ever-increasing frequency with which my help has been sought by patients who, unwillingly, and without even a "by your leave", have had to face the experience which for some is traumatic in a moment of dire distress, of having to enter a mixed ward.
Unfortunately, many patients are faced with the alternative of a mixed ward or of receiving no medical treatment. Therefore, I readily endorse my hon. Friend's strictures. Will the Minister take it from me that in allowing this practice to continue, and indeed to increase, he is endorsing what many thousands of people, in their moment of dire need, see as an affront? Will the Minister institute the consultations to which reference has been made, not just with the nursing representatives or the area health boards but with authors of journals and magazines who play such a valuable part in promoting the interests of patients and nurses?
I see in this growing practice a classic example of the interests of the patient being prostituted in the cause of administrative convenience. Because of the way in which these matters are interpreted, that feeling is growing fast. It is another example of the kind of social engineering to which we on the Conservative Benches take the strongest possible objection. The aged, the young, the sick and the sensitive await the Minister's reply with more than passing interest.
11.12 pm.
The Minister of State, Department of Health and Social Security (Mr. Roland Moyle): I am grateful for this opportunity to explain my Department's attitude towards mixed sex wards and also to correct what appears to be a misapprehension toward the position in the constituency of the hon. Member for Bournemouth, East (Mr. Atkinson).
The term "mixed sex wards" is, at best, a convenient piece of shorthand, which conjure up rather a misleading image. I hope to explain what the term means. In recent years there has been a movement towards the systematic grouping of patients according to the degree of illness and dependence on the nurse rather than on simple classification by diagnosis or by sex. New hospital accommodation has enabled this concept to be applied. There is a separate grouping of beds in an overall ward area—such as in bays of four or six beds each. It is possible for men and women to be nursed in the same ward, but in the privacy of a bed area occupied by one sex only. In wards of this kind communal areas, such as day rooms for ambulant and other mobile patients to use if they wish, are frequently combined. I see no reason to discourage this trend.
In some older buildings, accommodation may also be arranged so that men and women may be nursed in the same ward—normally partitioned or otherwise separated from each other—but of necessity both sexes may share some sanitary facilities and whatever day space is available. All such accommodation must be provided in such a way as to maintain privacy and avoid embarrassment. From the information which I have received, this appears to cover the provision in the East Dorset health district, which covers the hon. Gentleman's constituency.
It is easy to see how, in certain circumstances, the use of such purpose-designed or adapted wards for both sexes enables the best use to be made of the resources available. This makes a contribution to the reduction of waiting lists. Preferably such wards should be in purpose-designed accommodation, as indeed they are in modern hospital accommodation. But I admit that older, upgraded accommodation has to be used in many of our hospitals. Where a health authority decides to utilise other
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accommodation for both sexes, it must of course have regard to the need to ensure that reasonable privacy can be maintained and unnecessary embarrassment to patients avoided.
There are a number of circumstances where there are special advantages in desegregated accommodation. I have in mind, first, critically ill patients in intensive therapy units. The facilities are so specialised and the number of patients treated by them is so small that it would not be reasonable to provide separate accommodation. Most of these patients are unconscious or semi-conscious and there is an acute need for observation by nursing staff, which must take priority. The need of the patient for privacy should, however, be safeguarded as far as possible. Special units such as those for day surgery cases and programmed investigation units are also used by men and women, provided that there are appropriate arrangements to preserve propriety where both sexes occupy the units at the same time.
I should also mention that there have been found to be positive advantages for many patients, particularly for those with long-term or psychiatric illness in the provision of wards in which there is no segregation during the day.
The hon. Gentleman will wish to know that I am fully aware that when patients enter hospital their sensivity is heightened by apprehension. They will already be anxious about their health and worried by finding themselves in strange surroundings. They will be separated from the support of family and friends. During the course of treatment they may have to submit to questions and procedures which may seem to be an invasion of their privacy. For these to take place in the presence of members of the opposite sex may well add to their anxiety.
Most people in their daily lives expect a degree of separation of the sexes and privacy for certain activities. Any departure from these accepted norms can be upsetting. However important the contribution it makes, a therapeutic regime must be introduced to the prospective patient and his relatives with sympathetic understanding.
My Department has therefore drawn the attention of regional administrators, regional medical officers and regional nursing officers to the special need for

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arrangements to protect privacy in mixed sex wards, particularly during medical examination. It is certainly my view that when a person is to be admitted to a hospital ward which contains patients of both sexes the hospital should give him or her prior notice of the intention. I hope that where patients have expressed themselves to be unhappy about mixed arrangements the hospital will, if at all possible, offer alternative accommodation. But this might lead to a situation where the patient's admission has to be deferred until a bed in a single sex ward becomes available. Therefore, I cannot give the guarantee for which I have been asked. It would be impossible to do so.
In the main, the representations which have reached my Department from various parts of the country have failed to indicate whether the writer has actually been a patient. My experience and that of the Department seems to be at variance with that of the hon. Gentleman in a mixed ward. We do not know to what extent the criticisms stem from personal experience and to what extent they may be based on a possibly erroneous picture of what a mixed ward is like. Nevertheless, as a basis for action, I accept that some people feel strongly about this matter, regardless of the reasons for the mixing of patients in any ward.
It is difficult to arrive at reliable information about the attitudes of patients towards the treatment that they have received, but a survey of over 400 patients, conducted in Manchester—an area where there are a number of mixed wards—showed that only about 12 per cent. of the patients interviewed objected to having been in mixed sex wards. A total of 58 per cent. said that if they returned to hospital they would not be bothered about being in a mixed ward. Just over 26 per cent. expressed a preference for such accommodation. Of course, because this evidence is a one-off survey, it has to be treated with a certain amount of reservation.
As I indicated to the hon. Member for Cheadle (Mr. Normanton), there is no centrally maintained record of the number of hospitals in which the mixed wards system is operated. That is because I regard the use and management of mixed wards as a matter for local decision. I shall not, therefore, be conducting extensive consultations with health authorities
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and community health councils. I believe that these decisions are best left to local health authorities. It is a matter for local decision. Certainly I should not stand in the way of these decisions being taken if the proper departmental advice and guidance were followed. It is at the local level that administrators and their professional colleagues are best able to weigh up the various factors in deciding how best to use available resources.
In June 1978 the secretary of the East Dorset community health council wrote to the district administrator of the East Dorset health district on the subject of mixed wards. I should like to quote a few sentences from his letter:
" From discussions with local community groups I detect a growing concern at the practice of mixing male and female patients in hospital units and wards. Most people I speak with appear to accept the mixing of male and female patients in intensive care units "
—that, at least, is common ground—
" but consider that mixed units and wards are being introduced in other specialties where the mixture is unacceptable for a number of reasons ".
It goes on to say:
" Stories emanating from local community groups—which, in some instances, are forming the basis of reports being submitted for discussion at national conferences—lead one to feel that the local situation is worthy of a review."
I have looked at the letter. It reports a number of allegations, but mostly in general terms without specific instances, names or examples.
In response to that letter the district administrator reviewed the local situation and in August 1978 sent the community health council a detailed note on the mixed sex arrangements in the district. That showed that for the most part these were in intensive care or similar units or in children's wards and that the others—of which there were few—involved the use of wards subdivided into segregated single-sex bays, as I indicated earlier, or, in most cases, entailed no mixing other than in day rooms. However, there was a small number of male wards in which a number of beds—separated as far as possible from the rest of the ward—were set aside for the use of female patients when the pressure of demand for female beds made this necessary.

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In his letter the district administrator stressed that, apart from intensive care, coronary care and paediatrics, wards were not routinely mixed, except where special factors made this necessary. It was notably commoner in geriatrics and other provisions where the demand for female beds often exceeded the supply. He made it clear that it was the district management team's policy not to mix patients if it could be avoided but to give them maximum privacy.
The district administrator was obviously unable to confirm or deny any of the allegations in the letter from the secretary of the community health council, but he offered to investigate any specific complaints. I understand that that offer has not yet been taken up. Here is a way in which the secretary of the community health council can process the matter forward. If he will submit specific complaints to the district administrator, he will do his best to investigate and reach a conclusion on them.
In the past five years the district concerned has received only one complaint about a mixed sex ward. That referred to an ad hoc mixing of orthopaedic patients which was briefly introduced to meet a sudden staff shortage resulting from sickness.
On 22 September the Bournemouth Times published a colourful report under the headline
" Mixed Wards Trend Shocks the Women Patients "
which attributed to the secretary of the East Dorset community health council the view that "hospital bosses" were pushing forward "the new system" despite fierce opposition from women patients. It seems significant against that background that when the East Dorset
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community health council considered the question of mixed sex wards in October it did not make any representations to the district administrator or seek further explanations from him.
I gather that someone is organising a petition, but it is difficult for the district administrator to do other than assume that the community health council was satisfied with his explanation of the policy followed in the district, in view of the non-reaction of the council at that stage to his reply to the secretary. Apart from the petition, I am not aware of any new facts that have come to light to support the allegations referred to in the letter from the secretary of the community health council.
On the other hand, the district management team felt that it would be useful to draw up guidelines for arrangements in shared day rooms, and that has now been done, in the hope that it will relieve any sense of anxiety.
What is interesting about this episode is that it started not with specific complaints from patients but with vague allegations based, possibly, on a misunderstanding of the local policy. I hope that the explanations given by the district administrator to the community health council will help to reassure people in the Dorset East health district. Looking at the question nationally, I can only express the hope that, while there are bound to be variations throughout the country in both expectations and individual preferences, what I have said will assure those who may be worried by reports in the press or elsewhere about mixed wards that authorities concerned and their officers are fully aware of the importance of meeting the individual patient's need for privacy.
Question put and agreed to.
Adjourned accordingly at twenty-seven minutes past Eleven o'clock.