§ Motion made, and Question proposed, That this house do now adjourn—[Mr. Newton.]8.32 pm
§ Mr. Donald Anderson (Swansea, East)
I am glad to have this opportunity to open a short debate on a matter which, in my view, illustrates very well one aspect of the Government's attitude to housing in South Wales, namely, the response of the Welsh Office to the proposed sale of prison officers' houses at Clase in my constituency.
I suggest that the problem is best seen in the context of the overall housing crisis in South Wales. Perhaps we in Wales have become accustomed to low quality housing for too long and have given too little priority to housing as against our perhaps understandable prime concern with the problems of unemployment. Yet more than 15 per cent. of houses in Wales are substandard, compared with 9 per cent. in England. On most indices of unfitness, including those properties built before 1919, Wales comes bottom of the league table for Britain.
Certainly the general housing position has deteriorated under this Government. I commend to the Minister the recent report on this subject by the South Wales chief housing officers group, published in October last year and entitled "A report on the housing financial allocation to housing authorities for 1980–81". This has naught for the comfort of Welsh Office Ministers. The housing officers stress that the housing service in Wales is takinga far greater proportion of the public expenditure cuts than any other service".1057 Indeed, over the period 1980 to 1984 there will be a reduction of 40 per cent. in real terms in housing allocation.
No matter to what sector of our housing we turn—whether it be to public sector housing, private sector housing or the third arm, the housing associations—we see a constantly gloomy picture. The public sector is affected by the cutbacks. In the private sector starts have plummeted over the past year, in part because of the high mortgage interest rates, the general economic situation and the high unemployment in South Wales.
Hardly the most Socialist or radical group in South Wales, the South Wales region of the National Federation of Building Trades Employers, writes to me:The influence of the Government's economic policy is having catastrophic consequences for those firms relying on house-building as their main activity. As was stated, this is particularly true for those firms who have for many years made a major contribution to the house building in the public sector. The forecast in both the Swansea City and Lliw Valley borough councils' HSIPs for the period up to 1984 will inevitably mean some firms will cease to trade.The letter then gives the housing completions in Swansea in the private sector. In 1978–79 they were 398; in 1979–80 they were only just over half that figure, at 208. The comparative figures for the public sector are equally alarming. In 1978–79 there were 205 completions; in 1979–80 there were 156. A little more than 80 are forecast for 1980–81. With that shortfall in both the public building programme and the private building programme, it is hardly surprising that the waiting lists in all of South Wales increased to the present amount—well in excess of 29,000. Homelessness is also on the increase.
As the supply of public sector housing diminishes, because of the public expenditure reductions and the projected sales of council houses as part of the Government's policy, so the demand increases. That is partly for social reasons—the lower household size, which comes from an ageing population, break-ups of families and so on—but also because of the Government's policies, particularly in respect of the worsening unemployment figures in South Wales. All of that leads to defaults on mortgages, with those who default looking to the public sector for housing. This means that fewer can move from the public to the private 1058 sector and hence release homes for those on the waiting list. It must be remembered that our percentage of council houses in the total housing stock in Wales is less than 441st in England. For example, in my local authority in Swansea the percentage of council houses in the total housing stock is less than 30.
That is the context. We turn now to the specific problem and its importance for the Swansea housing situation. This is an excellent case study of the Government's ideology ratting on the housing needs of a local community.
The prison department owns 28 houses in Swansea, four of them with four bedrooms and the remainder with three. At the moment 23 are vacant, because prison officers in these days dislike living in compounds and prefer to live in their own accommodation, where they also enjoy rent allowances. So these houses are empty and surplus to the prison department's requirements.
The houses were built in the 1960s and are suitable for family housing. Al-thought they lack central heating, they are roomy, well-maintained and have garages. They are similar to the Swansea council's pre-war parlour-type houses which are among the most popular part of the housing stock of my local. authority.
The Home Office wishes to sell and the Swansea council wishes to buy, but Welsh Office approval is needed. The council wants to buy because these are attractive properties for its needs and because money is available in this financial year due to a projected underspend. That underspend does not arise from incompetent forecasting on behalf of the council. In fact, a scheme to build' about 100 houses on the Graig brickworks site in the same area was 17 per cent. over the housing cost yardstick and had to be abandoned. Those houses would have cost more than £20,000 per unit, compared with the asking price of £10,000 to £12,000 for the prison officers' houses.
Apart from the costs of the Graig brickworks scheme, the financial commitment that would have been necessary for 1981–82 was too large in respect of the uncertainties of the housing allocation that the Welsh Office would make, bearing in mind the fact that this year's allocation by the Welsh Office was not notified 1059 to local authorities until February. This tardiness has created substantial programming difficulties for housing authorities. However good reasons, the Swansea council has money available.
The council also has a large and growing waiting list of 2,435 families. One knows the arguments about how artificial waiting lists can be, but it is the view of my housing authority, and also my own personal impression from regular contact with constituents, that this is a real waiting list. It is underlined by the fact that homelessness in the city is a large and growing problem. Swansea is one of the black spots in Wales in this respect. Last year there were over 1,000 inquiries at the homelessness unit.
At £10,000 to £12,000, the prison department properties are good value for the city. The latest figure—in September this year—on a tender basis for two-bedroomed houses is £20,834, compared with £10,000 to £12,000 for these three-and four-bedroomed properties.
It is not surprising, therefore, in the light of that price differential and the large and growing needs of the housing authority, that my right hon. Friend the Member for Swansea, West (Mr. Williams) and I, and the whole city council, including the Conservative councillors, unanimously sought consent from the Welsh Office for the purchase of these houses.
There are a number of additional cogent reasons for that purchase. I have already mentioned the completions in the public sector in Swansea being reduced year by year so that the projected figure for this year is about 88. I have mentioned the state of the private housing market in the city. In effect, it is dead, as a recent deputation from the National Federation of Building Trades Employers underlined to me and to my right hon. Friend the Member for Swansea, West. On an impressionistic basis, I know of a cheapish house in a popular part of the city that has been on the market for over two months. During that time there have been only two visits and no offers. There are ample building society funds available for prospective purchasers, but few, if any, takers.
Those houses are likely to be unattractive to the private buyer. They are in 1060 terraces, and they are unmistakably institutional, having been built for a public authority. To that extent they are less attractive to an individual in the private sector. Another factor of which the Minister should be aware is that the Home Office is responsible for the roads and lighting on the estate. There would be considerable administrative problems if the houses were sold as single units. The charges for roads, lighting, and so on, would have to be apportioned between individual purchasers.
That is the background to the problem. The city council needs Welsh Office consent, and it has approached the Welsh Office. The response of the Welsh Office has been wholy negative, unreasonable and wooden. As far as I am aware—I stand to be contradicted by the Minister—there has been no inspection by the Welsh Office, no suggestion by the Welsh Office that if the houses did not sell on the open market its position would be reconsidered, and no suggestion by the Welsh Office that it would consider an alternative buyer such as a housing association, although, as no doubt the Minister knows, there is at least one housing association in the area that is interested in the houses. Although it would be a second best because of the nomination rights of the local authority, it would at least have the beneficial effect of reducing the ever-extended housing waiting list.
I say that there is little expectation of a positive response on the housing association front, and I am fortified in that view by an article in today's issue of the Western Mail, which states:The housing associations in Wales are launching a campaign this week to protest against any further cuts in Government aid which some believe could lead to the disappearance of a third of them.The report goes on to say:The problem is particularly acute in Cardiff and Swansea, where the waiting lists for accommodation are longest and the resources most thinly spread … Mr. Gareth Hughes, Welsh director of the National Federation of Housing Associations, said, ' If the cuts are made there will be no new houses built in Wales at all, and as many as a third of the housing associations will have to close. The situation is potentially dangerous'.So great is the danger that the Gwalia housing association, which was planning a special celebration on 5 November to mark its five hundredth house in the city 1061 of Swansea, will now use that event as a protest against further cuts in aid to the housing association.
If the Welsh Office has reacted in such a negative way to the plea of the Swansea city council, one perhaps has no high hopes that it will respond any more positively to an approach to it for consent from a housing association.
What was the nature of the reply of the Minister, dated 21 October, to the points that I put to him? He said that if the Welsh Office were to give consent it would be contrary to the policy of discouraging local authorities from buying existing property. That is clearly the doctrine. He also said:I believe that to allow the City Council to proceed in this case would not only be contrary to that policy but would be a complete negation of our views on private home ownership. The right course should now be to dispose of the houses on the open market if they are indeed surplus to existing requirements.The phraseif they are indeed surplus to existing requirementsmust suggest that the Welsh Office has not even bothered to contact the Home Office to see whether these houses are surplus to requirements. It has answered wholly from an ideological standpoint, without seeking in any way to check the facts on which it based that reply. Had it bothered to contact the Home Office it would have found, without any difficulty, that these houses are indeed surplus to Home Office requirements.
The Minister went on, in his letter of 21 October, to say:The purchase of existing dwellings places a quite heavy financial burden upon local authorities, and as it is the Government's policy to reduce public expenditure wherever possible it would not be seen right to be allowing a local authority to add to their existing commitments.If one uses the public expenditure argument, surely the Minister will look at the figures that I have given of the tender prices that the city council is now receiving for smaller properties—double the amount for which these houses are available on the market—and see what excellent value they are, rather than have new building in the public sector for the city council to take over. This is not in any way to municipalise because, after all, this is not a transfer from the private 1062 sector to the public sector, but a cash transfer from one part of the public sector, namely, the prison department, to another part of it, namely, a local authority. Indeed, on any figures, looking at house against house, or value against value, this would be a reduction in public expenditure.
The message is clear from the Government and the Welsh Office. They prefer to leave these properties empty and to be vandalised than to let them go to my local authority.
I am told that the local vandals have not yet noticed the 23 properties that remain empty. However, there are signs that they are beginning to notice. Already the shed windows in the back gardens of these properties have been smashed. Six of the windows have already been smashed. These first signs will further attract vandals and make the houses even more difficult to sell on the open private market. This will be a process of cumulative decline and the estate will rapidly become a wasteland as the last prison officers leave, as the nights darken and as the remaining tenants are unable to exercise some supervision over the estate. What an uncaring response! What a triumph of a doctrinaire Government!
I refer the Under-Secretary of State to the final flourish of the South Wales chief housing officers' group in the report to which I have referred. Having outlined the growing housing crisis in South Wales, it states:We therefore urge the Government to reconsider its attitude towards housing and towards a philosophy which cannot and will not work in the current economic situation. Unless this reconsideration takes place we believe that the housing problems of South Wales will reach a point when they may be insoluble.That is not the report of a group of radicals that the Government may think they can lightly disregard. It is a report from those in the front line—the directors of all the South Wales housing authorities—who see at first hand the effect of the Government's policies and who react in that way against the effects of those policies.
Had the Welsh Office, on a reasonable consideration of this case, given its consent, 23 families from the ever-growing waiting list in Swansea would have been immediately and decently rehoused. To them and to all those on the waiting list 1063 in Swansea, to my colleagues from Swansea, including my right hon. Friend the Member for Swansea, West and my hon. Friend the Member for Gower (Mr. Davies) who support me tonight, and to all those in Swansea in inadequate accommodation, the Welsh Office is saying in terms "Doctrine rules. Continue in your disadvantage. Our aim is to roll back the public sector"—this is set out so shamefully and so eloquently in the letter that I received from the Minister—"and to bring a new Tory freedom". This is a sad case and a sad feature of Conservative housing policy. What a perfect commentary on a wholly ideological response to a deeply human housing problem in Swansea.
§ Mr. Alan Williams (Swansea, West)
As the Under-Secretary of State will appreciate, though these houses happen to be in the constituency of my hon. Friend the Member for Swansea, East (Mr. Anderson), the housing list is managed on a Swansea city council basis and any decision that is taken on these houses will affect my constituency as well as that of my hon. Friend. I support my hon. Friend's argument.
At the time of the election there were many who were led to believe that the Conservative Party, if it became the Conservative Government, would support the family, the home and the aspiration to have a home. What has become of that? It is clear from repeated declarations and actions by the Administration that they regard as worthy of consideration only those who are willing to buy their homes.
The Under-Secretary knows that redundancies in Wales are multiplying and that closures and redundancy notices occur day in and day out. Many people are reluctant to make the long-term commitment to purchase a property. For most of those in my constituency and in that of my hon. Friend the only type of home for which they can hope is a new, rented one.
In common with other hon. Members, my hon. Friend and I hold regular Saturday morning surgeries. Normally not a Saturday goes by without my hon. Friend or I holding a surgery in the 1064 constituency. My hon. Friend also finds that at least 50 per cent. of the constituents who come on Saturday mornings come about housing problems, despite the fact that housing is a matter for local government. More than 2,500 people are waiting for housing in Swansea. I do not seek to make a political point, but the Under-Secretary knows the importance of current Government policy and its effect on house building in the public sector.
Those 2,500 people have little or no hope of being housed in the foreseeable future while the Government pursue such policies. Some of those on the housing list will never be accommodated in a council house. As youngsters grow up and aspire to have homes of their own they will join the housing list. They have no prospect of being housed. We have a small opportunity to do something to help. I could understand the Welsh Office arguing that such houses should be sold if there were a scarcity of houses for sale in Swansea. If someone were to walk or drive through the city, or visit an estate agent's office or read the South Wales Evening Post, our local evening newspaper, on any evening of the week, he would discover that, far from a scarcity of housing for sale in Swansea, there was a glut.
If the Under-Secretary persists with this policy, he will rob the couple of dozen of those in Swansea who are trying to sell their homes—perhaps because they have had to move as a result of the Prime Minister's advice to go elsewhere to find the jobs that are denied them in Swansea—of a chance to sell them. Until now he has insisted, unnecessarily, on transferring public houses to the private sector. If the hon. Gentleman wants to support the house owners of Swansea, he should avoid putting an extra supply of houses on the market when there is no need. If he wishes to help those whose housing need is most acute, he should add houses to the local authority's housing stock, because the local authority is already under severe pressure.
The Under-Secretary is well aware that Swansea has many old steel houses which were built just after the war. In my hon. Friend's constituency there is a project to refurbish those properties. Only a fortnight ago, the housing director told 1065 me that the steel houses in my constituency—in Waunarlwydd and West Cross—may not be refurbished, although they are in need of it. Funds may not be available from the Government. Houses that could be saved may slither into rusty decline. They will have to be abandoned. At the same time, houses are to be put on the market—although there are people in the housing queue—and they will remain empty for some time, because the housing market in Swansea is flat. That is the tragedy.
In addition, we even find that organisations such as housing associations which are not noted for political activity have tried to emphasise the desperate need in this respect. There is one housing association in Swansea which I would gladly see closed down. We have had exchanges with the Department about its activities. It is one of the least responsible organisations that I have ever come across. However, another the GWALIA Association—has been in touch with the Prime Minister and the Welsh Office trying to stress the desperate need that it sees for new rented housing in Swansea. Like the local authorities, it finds that it will be deprived of funds.
Let us not deceive ourselves that the Government will get the best possible bargain in selling these houses if they go ahead with this policy. There was the recent decision to sell the prison governor's house in Gower Road, Swansea. It was not sold on the open market; it was sold by private charter. A constituent of mine, who insists that he could and would have paid more money for it, was denied that opportunity because the Government told the agent that they wanted whoever would settle first at the set price. There is no pretence that the Government will necessarily get the best prices for the sale of these houses.
In any case, it is ludicrous that the local authority should be in a position in which it would have to pay more to build two dozen houses to help people in the queue than to buy the houses that were available. If the Under-Secretary is concerned about public expenditure, he should welcome the initiative by the local authority because it is not adding to public expenditure. The money would come out of the funds already allocated to that authority. Not only is it not adding to public expenditure; it is getting 1066 better cost benefit—it would have more houses by buying these than by building new ones. The Minister should welcome this initiative which would add to the efficiency of the housing department in Swansea.
If the Minister does not intend to be helpful tonight, I hope that before he makes a final decision he will ask the Swansea city council for an analysis of its housing list. How many are on that list? How many disabled and priority cases are there? We see these cases week in and week out—people with severe medical conditions who need these moves and cannot be accommodated because the whole housing system is in a log jam. There are no new houses coming on to the market to start mobility in the rental systems within the local authority. I hope that the Minister will at least do this if he will not give us a positive response tonight.
If the Government refuse this perfectly reasonable request from the Swansea city council, they will be seen as having sold out the aspirations of the people in Swansea, who want nothing more than a roof over their heads, in pursuit of rigid and, in this case, stupid and costly Tory dogma.
§ 9.8 pm
§ Mr. Ifor Davies (Gower)
I welcome the opportunity to intervene very briefly in this short debate. I congratulate my hon. Friend the Member for Swansea, East (Mr. Anderson) on raising this important issue. He has outlined the case fully. I declare an interest in that part of the administration of the city of Swansea comes within my constituency.
On this question of housing there is no greater problem confronting any of us than the appeals that we receive week in and week out from people who are looking for a roof over their heads. The record of this council is as good as any in its efforts to house people. However, in 1979–80 the figure for homeless people was over 1,000. The council deserves the Government's support in trying to house the homeless.
I have been informed on good authority that the Minister's Department has offered the houses free of charge to the West Glamorgan health authority. If that is so, it should be challenged in the House. It would be a direct contradiction 1067 of the letter that my hon. Friend for Swansea, East has. If the Minister cannot reassure us about that tonight, will he investigate the matter and clarify the situation? I urge him to reconsider the matter and give the Swansea council an opportunity to meet the tremendous demands made on it to house people.
§ The Under-Secretary of State for Wales (Mr. Wyn Roberts)
It may be helpful if I set out some of the recent history of the central issue raised tonight by the hon. Member for Swansea, East (Mr. Anderson), and followed up by the right hon. Member for Swansea, West (Mr. Williams) and the hon. Member for Gower (Mr. Davies).
Let me first assure the hon. Member for Gower that I have no knowledge of a proposed offer to the West Glamorgan area health authority, but I shall make inquiries. However, I point out that it is not for the Welsh Office to make such an offer. The houses are owned by the Home Office.
§ Mr. Ifor Davies
I have it on good authority that the rumour is true. If it is, there must be something wrong if the Home Office has not informed the Welsh Office.
§ Mr. Roberts
I understood the hon. Gentleman originally to say that the Welsh Office had offered the houses to the area health authority. I assure him that that is not so. I have assured him that I shall look into the matter, although, as far as I am aware, the position is as I have outlined.
§ Mr. Alan Williams
I realise that the Minister has been caught on the hop, but, if the circumstances described by my hon. Friend the Member for Gower (Mr. Davies) are correct, it is important for us to know in the very near future. Will the hon. Gentleman undertake to notify the three of us within the next 48 hours, as it will only take a telephone call to check the facts?
§ Mr. Roberts
I give the right hon. Gentleman that assurance.
Swansea city council wrote to the Welsh Office on 29 September for approval to acquire the houses at Clase. I shall be returning to the contents of the letter in 1068 a moment. The Welsh Office replied to the council with commendable speed on 2 October. A week or so later, the hon. Member for Swansea, East raised the issue with me and with my hon. and learned Friend the Minister of State, Home Office. My reply, which was sent on 21 October, fully explained my reasons for turning down the council's application.
In my letter to the hon. Gentleman I reminded him that the Government's policy is to discourage local authorities from buying existing houses. To allow Swansea city council to proceed in this case would not only be contrary to our general policy, it would be a complete negation of our views on home ownership. I told the hon. Gentleman—and I tell him again now—that the right course is for the houses to be sold in the normal way by the prison department on the open market.
The hon. Member has raised the matter again, and although he has not brought any new facts to my attention, I am glad of the opportunity to explain the Government's position to him.
It is our policy in housing to encourage owner-occupation. The Government have consistently stressed their desire to extend home ownership as widely as possible. We know that that is popular in Wales. Consequently, we have devised a seven-point plan to bring that about. The first is the sale of council houses to sitting tenants. The second is, the sale of local authority owned land to private builders, with planning permission, for starter home schemes or, in partnership with builders, to provide other forms of low-cost housing. Thirdly, local authorities can make better use of the available resources by building for sale where they are unable to develop partnership arrangements. They can improve older property in their ownership for sale under the Government's new scheme. They can even sell unimproved homes for improvement by the purchaser.
That could be especially attractive for occupiers of older council houses built between the wars since they would be free to choose their own time and terms for the improvement works and the local authority would be freed from the often considerable expense of improvement. I am as aware as any hon. Member of 1069 the problems that we meet as constituency Members. Often they are concerned with repairs and improvements to existing homes. The Government are doing their utmost to help. I am pleased to say that in Wales the level of owner-occupation is already high, and we would, of course, wish it to be even higher.
We feel that the balance between the private and the public sectors has been going the wrong way over the years, both in housing and in other fields. We have acted to reverse that movement. We believe that, in general, there are too many houses in the public sector. I accept that this masks some remaining needs, such as accommodation for the elderly, but certainly the stock of general needs housing—three- and fourbedroomed accommodation—is too great. According to the figures supplied by Welsh local authorities in their housing investment programme submissions this year, there are about 286,000 dwellings owned by local authorities in Wales. That is about 26 per cent. of the total housing stock—just over a quarter. There are, I understand, almost 65,000 dwellings in Swansea, of which nearly 20,000 are council owned. That represents about 30 per cent. of the total—a high figure in my view. It seems to me that Swansea city council's priority ought, therefore, to be looking to correct the imbalance by selling some of that stock. It would require the sales of almost 3,000 of its houses to bring it into line with Wales taken as a whole.
§ Mr. Alan Williams
With respect to the Under-Secretary and having listened to what he has said, I must say that I cannot feel a lot of respect for him. I have never heard such unadulterated twaddle and rubbish in my life. The hon. Gentleman and I have been personal friends for some years, but I ask him, before he goes any further, with this arrant nonsense, to check what real life is like behind the phoney statistics that he is peddling.
My hon. Friend the Member for Swansea, East (Mr. Anderson) and I have had to see us in recent weeks a succession of young families who have been told that the only hope for them, from the council's point of view, is for the families to split up, the children to be taken into care and the parents to find accommodation for themselves. If the Under-Secre- 1070 tary feels that that is evidence of a surplus of council housing in Swansea, I do not know how he forms his judgments. I do not understand the peculiar warped and twisted sense of values that he is peddling.
§ Mr. Roberts
We are all accustomed to the right hon. Gentleman's extremist and excessive remarks. His comments on what I have said are typical. If the facts are as he suggests, the position is surely no tribute to the high proportion of public sector housing and its management in Swansea.
One of the most significant elements in our Housing Act is the right that we have given to council tenants to buy the houses in which they have been living, often for many years. We have relaxed controls in the private rented sector with the introduction of shorthold tenancies which, of course, the Labour Opposition have threatened. Through our improvement for sale scheme, we shall be trying to promote the rehabilitation and sale of older houses by local authorities. What we have done in the Housing Act is to shift the emphasis away from the extension of public sector housing although, of course, we all accept that there will always be a need for new dwellings in special categories, and we do not deny that public sector housing will always have a significant part to play. Certainly I accept that local authorities have an important part to play in housing, not only in the public sector but in the private sector, too. I venture to suggest that their role should become even greater.
The Government's general policy is quite clear, and it is equally clear that it applies in this case. I do not expect the hon. Member for Swansea, East to agree fully with our views on municipalisation. This is an issue of principle on which the battle lines have long since been firmly drawn. But I would expect him to agree that what the council proposes is a clear and straightforward case of municipalisation, and therefore I would expect him to recognise that my decision is inevitable. The houses in question are certainly in the public sector now, and they are to be put on sale on the open market. What the council wants is to add the houses to its existing stock. If that is not municipalisation, I do not know what is.
1071 Of course, we accept that there can sometimes be occasions when local authorities may buy existing houses. The Department wrote to authorities earlier this year to remind them of the long list of categories of acquisition still permitted under the terms of the Housing Act 1957.
There are also areas where we are content to allow local authorities to add to their housing stock, apart from statutory obligations which arise, for example, in areas covered by confirmed compulsory order. We allow acquisition of property blighted by public knowledge of slum clearance or other local authority proposals, and we have agreed to acquisition by agreement from elderly owner-occupiers who are unable to maintain their homes and who are being rehoused by the local authority. We are also prepared to allow reacquisition of dwellings previously sold under pre-emption arrangements. But, as I made clear earlier today in answer to a question from the hon. Member for Caernarvon (Mr. Wigley), where old pre-emption arrangements have lapsed, I do not agree that reacquisition is right. Clearly for an authority to do so would mean that the authority was acting to bolster up the local housing market and safeguard the price base.
Some of the arguments advanced by the hon. Member and his right hon. Friend the Member for Swansea, West struck me as very curious. If we adopted them, they would result in intervention in the local housing market and in rising house prices.
In one area, which I have already mentioned briefly, we even encourage acquisitions. The Housing Act 1980 introduces the improvement for sale scheme. Under this scheme, authorities can acquire dwellings, usually vacant and run-down, improve them, and then resell them. In this way, acquisition by authorities can encourage our policy of home-ownership as well as rehabilitating some of the older housing stock. Authorities which take advantage of this scheme can have the benefit of an Exchequer grant towards the costs. The scheme has been devised because we are very much aware of the problems which exist in these areas of older housing w here, all too seldom, do local 1072 authorities undertake positive action to secure the renovation and improvement of such houses.
I accept that Swansea is tackling its housing action areas in an energetic way and achieving results, but there is still much to be done. Local authorities have the freedom to buy in these circumstances without formal approval where the objective is to resell once the house is restored to a good standard.
But Swansea city council's reasons, at least the reasons the council advanced to us for wishing to purchase the houses at Clase, fell into none of these categories. I hope that the hon. Member for Swansea, East will not mind if I refer to the letter from the council which sought approval for its acquisition of these houses. The hon. Gentleman said that there were a number of cogent reasons for the council seeking approval for the purchase and various reasons have been advanced this evening. But the council gave the Welsh Office only one reason. It said that it had been unable to proceed with a house building project this year. The chief executive wrote——
§ Mr. Roberts
I must finish this paragraph.
The chief executive wrote:As a consequence, there is an underspend on our programme which my council wishes to utilise in respect of these dwellings at Clase. In the circumstances, it was felt that this was the most expedient way of using the consequent underspend, particularly at this point in time in relation to the financial year".That is what the Welsh Office was told by Swansea council. Now this, if I may say so, reveals a sorry state of affairs.
What we have been told is that the council are not able to spend its capital allocation on one project, so it thinks that it can quickly use up the money by buying these houses at Clase. It is not for me to comment on its financial planning, or the arrangements within its housing programme, but I would say that it need not spend its allocation just for the sake of it.
§ Mr. Roberts
I need not emphasise the importance of cash limits. They must not be exceeded. The recent action of my right hon. Friend the Secretary of 1073 State for the Environment on capital allocations in England speaks for itself. So far, we have been able to avoid parallel action in Wales but the most careful planning and financial management by authorities is necessary.
Capital allocations to councils are not targets they have to reach. They are absolute limits which must not be exceeded. I would rather see Swansea city council underspend its allocation than have it use it to finance property transactions to the public sector. This is simply not a worthwhile use of public money.
But of course there are other worthwhile uses to which Swansea could put the money. It has active housing action areas as I have mentioned already, where much needs to be done. The council has now more scope to encourage improvements in the private sector with grant aid—and the Housing Act 1980 enables it to assist with grants for essential structural repair. Of course, at the lower end of the housing market—an area where I know Swansea is active—there is scope for further mortgage assistance either for house purchase, where building societies are not active, or in support of essential improvements.
Perhaps I could take this opportunity of stressing that there is no shame in underspending an allocation. We know that problems develop and our best laid schemes fail to materialise or are delayed. This is why we maintain a careful monitoring system on housing expenditure, and why we are prepared, if the opportunity offers, to re-allocate one authority's unspent provision to another.
Hon. Members suggest that the houses at Clase could not be sold in the private sector. They suggested that it is a poor time for the Home Office to be selling. I find that extraordinary. If the houses are offered at too high a price market conditions will certainly ensure that they are eventually sold at a lower price, to the benefit of the individual purchasers. I cannot think that the hon. Members really want the city council to use public money to intervene in the market to keep up the price of houses. That was the conclusion of the argument by the right hon. Member for Swansea, West. I am certain that I speak for my right hon. Friend the Home Secretary when I say that he would not want Swansea city 1074 council to use public money in paying a price for the houses which would be higher than the price determined by the open market. The Home Office wants to sell the houses and I understand that it does not see any great difficulty in selling them in the normal way to individuals on the open market.
§ Mr. Alan Williams
In that case, why does not the Under-Secretary of State agree that the local authority can buy them at whatever the lower price is supposed to be? Why should they be sold to the local authority at a higher price than on the open market? Let the local authority have them at that price and that will satisfy the hon. Gentleman's worries.
§ Mr. Roberts
If the houses are placed on the open market any individual can buy them. Surely the right hon. Gentleman does not wish to deprive these citizens of Swansea of the opportunity to purchase these homes.
I expect building society mortgages to be available for such purchases by private individuals but it would be more in keeping with this Government's policy to make the council's unspent allocation available for mortgage lending here, if it proved necessary, rather than use the money to purchase for its own stock. Why does the council not follow that procedure?
I have carefully considered what has been said, but I see no reason to reconsider my previous decision. It would be a complete negation of our policy on private home ownership if I allowed Swansea city council to proceed as it wishes. The Government's aim is to reduce the scope of the public sector and this could not be achieved if we allowed local authorities to use public money to buy houses which otherwise would be bought by private individuals. The purchase of these houses by Swansea city council would do nothing at all to increase the housing stock of the area. It would reduce the council's ability to spend its allocation on other, more worthwhile purposes. It would involve also the expenditure of scarce resources which, spent another way, might result in more worthwhile housing assets at the end of the day.
Indeed, I add—in case hon. Members have not thought of it—that even if the 1075 council were to buy these houses and to rent them to tenants the tenants would, in due course, have the right to buy them under our Housing Act. And I am sure that they would exercise this right.
§ Mr. Roberts
The right hon. Gentleman may say "Let them". In that case, why go through all the procedure of Swansea buying the houses, of putting tenants into them and then of those tenants buying the houses when the houses could be placed on sale immediately? By agreeing with me on that score, the right hon. Gentleman and his hon. Friends have conceded my point.
We do not wish to interfere unnecessarily in the affairs of local authorities, but what Swansea city council now proposes is in direct conflict with our policies and it cannot be allowed. I have listened carefully to the right hon. Gentleman and his hon. Friends, but I have to say that my earlier decision cannot be changed.
§ Mr. Anderson
Could one sum up the Minister's position by saying that the Welsh Office is prepared for these houses to remain indefinitely for sale and be vandalised rather than let them be transferred to the Swansea city council and help reduce the growing army of despairing young people who cannot afford housing otherwise?
§ Mr. Roberts
That is a totally unfair summing up of the Welsh Office position. These houses will be put on the open market just like any other houses. There is no reason to suppose that anything will happen to these houses that might not happen to any other houses that are put up for sale. The hon. Gentleman is quite wrong in his forecast. He can trust the Home Office to look after its own property and to ensure that these houses are put on the open market. He can be sure that the citizens of Swansea who wish to buy them will have the chance to do so, as will anyone else, on the open market.
§ Question put and agreed to.
§ Adjourned accordingly at twenty-three minutes to Ten o'clock.