CONDITIONS OF SALE

HC Deb 11 June 1980 vol 986 cc662-72

Mr. Rifkind

I beg to move amendment No. 61, in page 8, line 41, after ' tenant ', insert ' 'or any of his successors in title'. The amendment extends the prohibition on the imposition of pre-emption conditions to include pre-emption conditions falling on the original purchaser's successors in title. The amendment will be beneficial in two ways. In relation to houses which are not intended to be subject to pre-emption conditions, it might have been possible for a landlord to impose a pre-emption condition directly on to a successor. Clearly that would have been inappropriate and against the Bill's intentions.

In relation to houses which are intended to be able to be made subject to pre-emption conditions, the amendment makes it clear that authorities which have chosen to waive their right to pre-emption on the first occasion that a house is sold can, nevertheless, exercise that right should the house be resold a second time within the period. If a second owner wishes to sell a property, the local authority should be entitled to exercise the right of pre-emption.

Amendment agreed to.

Mr. George Robertson

I beg to move amendment No. 62, in page 8, line 43, after ' of ', insert 'a dwelling house of one or two apartments or'.

Mr. Deputy Speaker

With this we may discuss the following amendment :

Government amendment No. 63.

No. 64, in page 8, line 43, after ' been ', insert ' provided'.

No. 65, in page 9, line 2, leave out from ' person ' to end of line 3.

Mr. Robertson

There are two parts to the argument. The first relates to the small number of one- or two-apartment houses in the Scottish housing stock. The second relates to houses provided for disabled people. The Government have made a provisional decision not to exempt houses for the disabled from the right-to-buy provisions, although they have said that they will reconsider the matter. The danger is that the few houses for elderly and disabled people will be subject to the right-to-buy provisions and will disappear from local authority housing stock.

The only protection for specifically designed houses from the right-to-buy provisions is in this part of the Bill which allows for certain pre-emption rights to be retained by local authorities so that they can repurchase houses if they come on to the market.

In amendment No. 63 the Government seek to tighten the definition of houses covered by the pre-emption clause. We welcome the tightening of the definition, as far as it goes. However, it is not enough to reassure people who believe that potential problems will continue to arise because of the severe shortage of such specialist housing.

The problem is recognised even by this Government. They have made savage cuts in the housing support grant and the general house building programme in Scotland so that council house building will be reduced to pre-war levels, but local authorities are being exhorted by the Government to concentrate the money that they have—and that is precious little—on specialist interest housing, with an accent on the elderly and disabled.

Neither party can be particularly proud of Scotland's record in this respect. There is a sizeable gap in the provision made for such people. The totals were announced in a written answer on 4 February. A total of 2,794 local authority houses, 216 new town houses and 67 SSHA houses are designed or adapted for the physically disabled. That total does not go to the nub of the problem.

Houses that have been specifically designed are an expensive matter for any local authority looking seriously at the problem. Any move by the Government that proves a deterrent to local authorities to build such houses would be a backward step and would exacerbate the problem. Amendment No. 62 is desgined to protect the smaller houses of which there is a disproportionately small stock in Scotland and which tend to be the houses required by the elderly. If there is any prospect that local authorities will start to lose even more of that small number of one, or two-apartment houses, the difficulties experienced are likely to continue to afflict succeeding Governments.

A loophole in the Bill is that people other than sitting tenants can benefit from the right to buy, probably not immediately, but within the foreseeable future. This means that small units, adequate and appropriate for the elderly, will disappear from local authority housing stock.

Our amendments are designed to strengthen the hand of local authorities in providing for what even the Government consider to be a major housing priority. I hope that the Government will recognise the force of the arguments made by Shelter and by local authorities and will take on board our amendments which would strengthen substantially the provisions in the Bill and in amendment No. 62.

Mr. Gordon Wilson

I express a wholehearted welcome for the amendment put down by the Labour Opposition. The case was presented in reasonable terms by the hon. Member for Hamilton (Mr. Robertson). The amendment should commend itself to the Government. In most areas, with the age of the population rising, there is a tremendous demand for smaller houses for old people. If those houses are bought by sons and daughters, they will be taken out of circulation for older people.

I could have extended my argument to include ground floor houses. That issue, however, is not before the House. In the current situation, the one or two apartment houses will not be replaced because the Government are not making finance available. The housing programme has come to a crashing halt. It will be difficult for these houses to be taken out of circulation if there is no prospect that local authorities can replace them.

Mr. Cook

I echo the sentiments of the hon. Member for Dundee, East (Mr. Wilson). I support warmly my hon. Friend the Member for Hamilton (Mr. Robertson) in the amendment that he moved. This debate would not be necessary if the Government had framed their legislation to allow discretion to housing authorities in the application of the sale of council houses. I am surprised that the hon. Member for Perth and East Perthshire (Mr. Walker) dissents. The hon. Gentleman will perhaps share his views with the House. This matter affects the elderly section of the population. One might have expected that at least one Government Back Bencher would let hon. Members know whether he shares the views of the Opposition on the housing conditions of the elderly.

Mr. Bill Walker (Perth and East Perthshire)

The hon. Gentleman is aware that we spent some time in Committee discussing the Bill. I made my views clear at that time.

Mr. Cook

The procedure of the House provides for a Bill, as reported by a Committee, to be tested and examined by the whole House on Report. I can perhaps exempt the hon. Gentleman from giving his views again. That still leaves 332 Conservative Members. I should have thought that at least one would have wished to give his views about the housing conditions of old people.

8.15 pm

Mr. Hugh D. Brown

My hon. Friend will have noted that the hon. Member for Perth and East Perthshire (Mr. Walker) was one of the few with a legitimate excuse. He was a member of another Committee at the time. Even so, hardly a word was heard from him in Committee.

Mr. Cook

I believe that this matter has been adequately explored. If local authorities were given discretion about which houses to sell and not to sell, I do not think that more than a handful of them would willingly decide to sell one-or two-apartment dwellings that are suitable for the elderly. Virtually no housing authority in Scotland has enough of these dwellings. At the time I last inquired, the number of applicants in the Edinburgh district council area, for one- or two-apartment houses, as a proportion of the waiting list, was double the number of one- or two-apartment dwellings as a proportion of the housing stock. That is typical of the position throughout Scotland.

In general, elderly applicants wait twice as long as other applicants because it is more difficult for them to obtain the accommodation that they seek. Ironically, they are the people who have less time to wait. By the time the offer comes round they may no longer be able to take advantage of it. That is one reason why few housing authorities would willingly sell off this stock.

There is another reason. If there is an area where speculation is likely to occur as a result of the Bill, it is among houses for the elderly. That is the sector where one might expect to realise an investment in the near future as the tenant dies and the house becomes vacant It is not readily obvious why someone who is now retired, living in a house suitable for an elderly person but not necessarily adapted for an elderly person, should choose, at that moment in life, to become an owner-occupier other than for the speculative value when that house becomes available to his descendants or whoever may have advanced the loan with which the house is purchased.

My hon. Friend's moderate amendment would not deny such a tenant the right and ability to become an owner-occupier for the rest of his term, but it would give the district council a preemption right that would enable it to recoup the house when it came back on the market. That would discourage speculation. There would be no point in speculating when it was known that the local authority might exercise preemption and recoup the house. Secondly, even more important, it would retain the house in a housing stock where it was desperately needed.

Mr. Gordon Wilson

Will the hon. Gentleman accept that his first argument may not be correct? If the house is sold and a pre-emption right applied, the risk of speculation will not be curbed because the enhanced value will have to be repaid.

Mr. Cook

Speculation would not necessarily be eliminated, but the fact that a local authority was in a position to exercise a pre-emption right would, to use the hon. Gentleman's phrase, curb it to some extent. We are dealing with a type of house of which there are not enough. There will plainly not be enough built in future years. We discussed yesterday the effect of the cutback in capital allocation. Even to keep abreast in the growth of the number of elderly will strain the capital allocation that remains. In those circumstances, it is plain folly to sell off houses without taking the modest step of providing a pre-emption clause.

Mr. Hugh D. Brown

I should like to add a few sentences. Something that is new since this matter was discussed in Committee is the fact that the report on the provision of services for the elderly has been issued. Even in the foreword to that report the Secretary of State for Scotland had the grace to admit that he could not accept its recommendations and that there was no obligation on him to accept them. That merely indicates to me that the Government are totally incapable of allowing any flexibility with regard to the type of housing for the elderly, even though we warned them that in cerain areas there could be a demand from sections of the community other than the elderly.

We are winning the arguments, yet there has not been a concession of any substance. We have bent over backwards to stress that this is not another case of obstructing the legislation which the Government are determined to push through. It is not a case of reducing the number of people who will be eligible. This type of housing accommodation is in short supply. Yet in spite of all the arguments, the Government and the Minister are going ahead pigheadedly with their ideological crusade to sell everything that they can. It is tragic that we have not had more time tonight—I do not blame anyone, because there are too many amendments, to which we have contributed—to discuss the problems of housing for the elderly.

Mr. Rifkind

I must first refute the point made by the hon. Member for Glasgow, Provan (Mr. Brown). The Government have acknowledged the problems of the elderly. It is for that very reason that all sheltered housing, which is the matter of greatest interest to the elderly, is excluded from the right to buy. Were the Government being pigheaded, dogmatic or ideological, there is no reason why they should automatically have chosen to exclude sheltered housing. They have done so because they recognise its importance.

The hon. Member for Edinburgh, Central (Mr. Cook) said that this problem would have been removed if only the Government had allowed discretion to the local authorities in terms of the houses that they sell. He must appreciate that any possibility of the Government's being able to move in that direction was removed by the attitude of the Labour Party in the local authorities that it controls. For example, how many houses are at present being sold in Glasgow, Dundee or Aberdeen at the discretion of the local authorities? Not one—thus making clear that only when Parliament has so decreed will a house in any of those local authority areas that are under Labour control be sold. Therefore, we must accept the unfortunate reality that the provision of general discretion to local authorities would have meant that in Labour-controlled authorities not one house would have been sold in the future, as has been the case in the past.

Mr. Cook

The Minister is well aware that the Bill was drafted and published at a time when only five authorities in the whole of Scotland were under Labour control. If the Government produce a Bill that is so intransigent, and that leaves so little room for flexibility at a local level, they cannot complain if those who subsequently win elections and are in opposition to the Bill adopt an equally intransigent position.

Mr. Rifkind

But the Labour Party's views have not changed since the Bill was published. One can look with a great deal of curiousity but with very little satisfaction at the attitude of Labour controlled authorities in Scotland and elsewhere during the last 20 years. Hardly one Labour authority has sold a house, except when it has been forced upon it. Therefore, the hon. Gentleman cannot put forward that proposition.

Amendment No. 62 does not specifically refer to the elderly, but rather to one- or two-apartment houses. Here there is an inconsistency in the Opposition's approach. In Committee they spent half their time arguing that the elderly would never take advantage of these provisions, that they would never wish to buy their homes, and that it would be pointless their wishing to do so, yet they are now suggesting that all these houses will be sold as soon as the Bill becomes an Act of Parliament.

The only proposition that has been put forward today is based on the pure speculation that although elderly people themselves would have no interest in buying the house, and although they probably would not have the means to do so, they have thousands of relatives in Scotland who are waiting for the moment to come when they will be able to make a gift to their elderly relatives in order that they can purchase their property. As a pure theoretical proposition, I cannot prove that that will not happen, but, equally, Opposition Members have not produced one iota of evidence to suggest that it will. But that is the only basis on which they have put forward their argument.

Mr. Gordon Wilson

Is not the hon. Gentleman in danger of extending his argument too far? He is talking about house sales and the extent to which houses will be sold. Does not he accept that houses that are occupied by the elderly will be held for a shorter period, because of the facts of life and turnover, and that such houses will normally come into circulation more frequently? If there is a shortage of those houses, surely there should be a pre-emption that would allow a local authority that had a superfluity of elderly tenants to repurchase the house and to pay the price as determined by the district valuer, in order to meet demand?

Mr. Rifkind

But even if the person who has bought the house dies, and the house again becomes available, it will be an attraction only to those who need one-or two-apartment accommodation. The categories of the population that would benefit from that type of housing are severely limited. Again, I should stress that there is no question of housing being lost to the community. The housing still exists and is available for those who need one- or two-apartment accommodation. If substantial numbers of elderly people in such accommodation wish to exercise their right to buy, it seems wrong that they should be penalised compared with the rest of the population. On the other hand—this is the argument normally put forward by Labour Members—if hardly anyone in that category wishes to exercise that right, it is wrong to suggest that such houses would be sold in any numbers.

Mr. Wilson

The Minister has just said that it would be wrong for these people to be penalised. In what way are they being penalised? As I understand it, they are allowed to purchase houses. However, if the amendment is accepted they will be allowed to purchase the houses subject to a pre-emption clause. The aim of that is to retain the house for the benefit of the community. However, that would still allow the value of the house, or any added value as determined by the district valuer, to go to the tenant or his successor.

Mr. Rifkind

It is right and proper that if an elderly person wishes to exercise the same right as other members of the community he should derive the same benefits. A house that has a pre-emption clause tied to it will clearly not be as attractive to a potential purchaser—[HON. MEMBERS : "Why?"]—because the market value will be significantly affected. That is my point of view, but I accept that Opposition Members may take a different view.

Mr. Millan

It is not a question of what we accept ; it is a question of what is in the Bill. As I understand it, the Minister was at great pains in Committee to make it absolutely clear that a preemption right would in no way affect the value that the person concerned would obtain. Is he saying that the Bill does not provide that?

Mr. Rifkind

I am saying that we see no reason why elderly persons who might wish to purchase such property should be in a different position from that of the rest of the community. I take it that Opposition Members do not accept that viewpoint.

8.30 pm

Mr. Cook

For 20 sittings in Committee and for 48 hours on the Floor of the House the hon. Gentleman has insisted that when houses are bought they will not disappear, and that the tenant will sit there for 20 or 30 years and not disappear. He says, therefore, that the question of access to the house through re-letting will not arise. He must apply the logic of that position—he has repeated it tediously to the House—to the argument that he is advancing.

If the tenant does not move on—we are dealing with elderly tenants, who are not likely to move out of the houses that they have purchased until they die—he has the full enjoyment of that house, as an owner-occupier, under my hon. Friend's amendment. What does not exist is the right for that house to be put on the market after he is dead and in the ground. Under the pre-emption rights the local authority could then step in. During the time that he occupies the house he enjoys full rights as owner-occupier. It is not fair to say that such a person would be in any way disadvantaged by this amendment.

Mr. Rifkind

The amendment does not refer solely to elderly people ; it refers to a certain class of accommodation. I accept that it is largely occupied by elderly people—though not exclusively so—but there are many single people whom local authorities can occasionally accommodate, and there are other categories also within the group. I have explained the position of the Government, but I do not expect hon. Gentlemen to agree with it.

Government amendment No. 63 seeks to clarify special needs housing where major adaptations have been made for the elderly or the disabled. The Government have made it clear that where housing has been specifically adapted to the needs of the disabled or elderly that the pre-emption right should apply. Accordingly, I commend Government amendment No. 63.

Mr. George Robertson

After all the time that we have spent debating the issue, and bearing in mind all the views that have been expressed to him, the Minister must be either naive or blind-if he continues to believe that this provision will not affect the housing stock available for the elderly. There may be a loophole here that could provide a capital gain for somebody but there are plenty of people on the Conservative Back Benches—and some on the Front Benches as well—who could tell of simi- lar loopholes in every Finance Bill that comes before this House. It is naive for anyone to put forward the argument that this loophole will not be used when there is a clear capital advantage available to some people who will exploit the shortage of this kind of accommodation.

It is worth putting on record that 52 per cent. of Scottish households consist of one or two people, and that most of those households comprise elderly people. Yet only 14 per cent. of Scotland's public housing stock is suitable for the elderly. Any diminution of the housing stock available for the elderly will exacerbate a problem that even this Government recognise is severe in Scotland.

We do not wish to take up the time of the House by dividing on this issue, important though it is. We are willing to allow the Government further time to reflect on the obvious and serious problem being experienced by local authorities throughout Scotland. I have no doubt that in another place our hon. Friends will table amendments that will raise this subject again.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendments made: No. 63, in page 8, line 43, after ' which ', insert 'has facilities which are substantially different from those of an ordinary dwelling house and which'.

No. 68, in page 9, line 15, after ' instrument ', insert 'subject to annulment in pursuance of a resolution of either House of Parliament'.—[Mr. Rifkind.]