HC Deb 05 March 1979 vol 963 cc912-1041


[9TH ALLOTTED DAY]—considered.


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

3.57 p.m.

Mr. Michael Heseltine (Henley)

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 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.

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 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 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 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 (Mitcham and Morden)

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 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 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.

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 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- 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 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 (Hornsey)

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.

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 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- 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 (Isle of Wight)

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 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 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 (Liverpool, Garston)

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 (Northampton South)

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.

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 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 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 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 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.

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 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 (Daventry)

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- 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, 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- 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 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.

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 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- 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 (Birmingham, Erdington)

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 (Norfolk, South-west)

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.

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 (Birmingham, Ladywood)

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 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. 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 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 (Buckingham)

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 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. 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 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 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 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 (Birmingham, Ladywood)

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 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 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 (Northampton, South)

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- 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 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- 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) 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 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 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 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 (Gravesend)

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 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 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 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 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 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 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.

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 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 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 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 (Isle of Wight)

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.

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 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- 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.

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 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.

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.

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 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— 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 (Norfolk, South-west)

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 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.

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 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 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 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, 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 (Pontefract and Castleford)

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 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.

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.

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 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 (Birmingham, Stechford)

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 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 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 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 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 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 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 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 (Hackney, South and Shoreditch)

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 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 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.

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. 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.

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.

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 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 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 (Reading, North)

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 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.

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- 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 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 (Liverpool, Garston)

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 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 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 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 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 (Melton)

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 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 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 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 (Battersea, South)

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, 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 (Ealing, North)

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 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 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 (City of London and Westminster, South)

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 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 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 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. 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 (Hornsey)

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 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 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, 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 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 (Hayes and Harlington)

The hon. Gentleman is very knowledgeable about London housing. Perhaps he will say whether he thinks it right that Hillingdon borough council 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 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 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 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 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 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 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 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 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 (Salford, East)

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 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: " 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 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.

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- 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
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
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
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.