HC Deb 31 July 1981 vol 9 cc1403-9

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

1.32 pm
Mr. George Cunningham (Islington, South and Finsbury)

The grievance that I want to raise is that council tenants, certainly in my constituency, more generally in London, and I believe throughout the country, have to pay much more for communal central heating and hot water than other people not housed in council accommodation. I feel this grievance particularly because the majority of my constituents live in public accommodation of one kind or another. There are three local authorities providing accommodation within my constituency—the borough of Islington, the Greater London Council and the Corporation of the City of London, to say nothing of many housing associations in the area.

The heating charges levied by all three public authorities are high compared to the charges that one would have to pay in private accommodation for the same service. I stress that I am talking of communal heating systems and not of those heating systems, even in council accommodation, where the tenant has complete control with a separate boiler provided for each dwelling.

In comparing the costs levied by local authorities with what is normal and understandable, one has recourse to a useful series of booklets that I hope will continue to be produced by the Department of Energy. These booklets, called "Compare your home heating costs", contain different figures for different parts of the country to take account, among other things, of differences of temperature. I shall be referring to the South of England edition.

The latest booklet, dated January 1979, is based on figures relating to November 1978. In making use of the figures, one has therefore to make some rough and ready uprating to take account of the rise in fuel costs since that time. While acknowledging that the booklets are not the responsibility of the Minister who will reply, I hope that the hon. Gentleman will pass to the Department of Energy my hope that no decision has been taken to terminate publication of the booklets, which have been useful not only for the purposes of this type of debate but also to many people throughout the country in determining the charge that they might have to face for the provision of space heating and hot water. I hope that the Department of Energy will proceed belatedly with the production of an up-to-date version of the booklets

I take as my first example tenants of a one-bedroom flat—a two-room flat with other facilities—in the borough of Islington. A tenant enjoying full central heating and hot water will pay anything between £6.60 and £8.90 a week for the service. Tenants enjoying partial space heating and hot water will pay anything between £5.85 and £6.90 a week. Tenants with full space heating and no hot water will pay just under £6. Those with partial space heating and no hot water will pay between £3.69 and £6.08. The variations depend on the age of the accommodation and on whether the heating is provided by gas or oil and similar variations. I have based my figures on a selection of those levied in different blocks.

The figures are a disgrace. Anyone who pays for heating in his own home—perhaps a detached house—knows that he can get far more space heating and hot water than these people remotely get for not much more cost. A study needs to be made to discover why people are having to pay what I claim amounts on average to double the sum for the same amount of space heating and hot water compared with the rest of the population.

I should like to compare some figures with those given in the Department of Energy booklet. I take a two-bedroom terraced house with full space heating and hot water. According to the Department of Energy booklet, the average payment might be about £2.50 a week for an oil-based system. I wish to make a comparison not with a terraced house but with a flat which normally has party walls either all the way round it or nearly all the way round it. I wish to give figures for Islington borough council property. A gas-fired system in pre-1953 accommodation costs £10.28. For oil-fired 1953 to 1969 accommodation, the cost is £8.90—and that is for a one-bedroom flat, the only figure available. In gas-fired post-1970 accommodation the cost is £10.51 a week. In gas-fired post 1980 accommodation it is £8.45 or £9.43 a week.

The figures amount on average to £9 a week, or £470 a year, compared to a figure in the 1979 Department of Energy booklet of £129 a year. Even doubling that figure to take account of inflation, which would be excessive, the sum amounts to about £260. The booklet shows that, even including the cost of equipment and the cost of paying interest and amortising the capital over seven years, the running costs and the equipment costs in this type of accommodation might come to about £373 a year, or £7 a week.

Islington borough council tenants in the same size accommodation seem to be paying half as much again as they ought to need to pay even if they were amortising the equipment which is in use—and, of course, they are paying for the amortisation of the equipment as part of their rent, quite apart from the heating charges which they are paying.

Secondly, I ask the House to compare Islington borough council three-bedroom flats with the three-bedroom semi-detached house given in the example in the booklet. The booklet says that the latter, on an oil-fired basis, would cost about £4 a week, or £220 a year. To be on the safe side, let us double it to take inflation into account. We come to a figure of £440 a year, or £8 a week. The equivalent Islington borough council flat charges are, for oil-fired 1953–69 accommodation, £8.90 for just one bedroom. For a gas-fired system post-1970, it is £12.37 a week. For a gas-fired system post-1980, it is £10.91 a week. That is an average of, say, £11 a week, or £580 a year, compared with a booklet figure, doubled, of £440 a year.

Rather unusually, I have in my constituency a great deal of City corporation accommodation. Half of all the City's extra-territorial accommodation is in my constituency. There are three estates. In two-bedroom flats on those estates, which do not all have full space heating, the charges are £9.50 a week, £7.55 a week and £9.75 a week on the three separate estates—an average of about £500 a year. That compares with a figure in the booklet of £2.50 a week for this size of accommodation, and that is £130 a year which, if we double it, comes to £260. So we have £500 for the City corporation tenant and the doubled booklet figure of £260 a year.

It is that kind of comparison which justifies me in saying that the council tenant is paying about double what a person outside council accommodation would normally pay.

If we take a comparison on three-bedroom accommodation, the booklet figure is £220, doubled to £440, and the City corporation charges in my constituency work out at about £10.70 a week, £8.45 a week and about £10.50 a week—once again, an average of about £520 for the council tenant, compared with no more than a doubled indicated level of between £400 and £440 for other people.

Council tenants in many parts of the country—certainly in my constituency—are paying far more for heating and hot water than other people are paying for precisely the same amount of heating and hot water.

Are they getting better service? No one will imagine that they are. Often the systems in council accommodation work badly. They fail and are not repaired quickly. Tenants often have difficulty in getting refunds for periods when their systems are not working. I have many tenants at the moment awaiting refunds from the GLC for weeks when heating was not working at all or are working badly. When faults occur, tenants have to use temporary means of heating, often extremely expensive electric fires. If they are tempted to use mobile Calor gas fires, they find that they have a large capital outlay for an appliance which should never be needed and which will be needed only some of the time. They will also find that the use of such fires is often prohibited on safety grounds.

Why, then, do council tenants have to pay so much compared with other people? First, there is simple inefficiency. The same administrative inefficiency which characterises other aspects of council housing departments also characterises this aspect. Repairs are done badly and have to be redone. The cost of however many jobs it takes to carry out a repair has all to be put on to the heating account. It is not just the cost of the job which needed to be done; it is the cost of the messing up of the job and of putting right the messing up of the job for which the tenant has to pay.

Secondly, many places suffer from bad design. It is a tragedy of our age that architects, instead of allowing their diseased imaginations to work on the houses in which they themselves live have allowed those diseased imaginations only to work on the blocks which they have built for other people—our constituents—to live in. These places are often absurdly badly designed. Double glazing, so common on the Continent and increasingly common in owner-occupied accommodation here, is hardly ever seen even today in council estates. The cost of putting in double glazing when it was not put in in the first place is very high compared with the cost of initial installation.

Thirdly, there is extremely bad insulation of most hot water tanks. The ready-insulated tank which is produced by the manufacturer with an inch or one and a half inches of insulation bonded on to the copper tank is still not commonly used by councils. There are still many councils which never dream of putting in double immersion heaters, if immersion heaters are in use. By a double immersion heater, I mean one which has a long element and a short one so that, if the householder wants only a little hot water, he does not have to heat the whole tank. This is an easy enough device to purchase, but far too few public authorities take the trouble to purchase that as against the slightly cheaper single element heater.

Those are only some of the reasons, along with simple inefficiency, why the charges are so much greater. But it still leaves a total question mark in my mind. I do not understand how the charges can be as high as they are, even given all these disadvantages.

I should like to see the Department of the Environment, in its local authority surveillance capacity, asking a selection of local authorities—not all of them—in different places to supply it with the figures for the charges which they levy for space heating and hot water heating.

I should also like to see the Department of the Environment using those figures, consulting the Department of Energy about them and, by sending out its regional representatives, trying to find out what it is which makes the charges for local authority tenants so much greater than any commonsense assessment of the objective facts would suggest is right.

That is the specific request which I make to the Minister. The present situation is taking council tenants for a ride. It is making them pay roughly twice as much as they should be paying. Although I can see that the Department of the Environment can say that this is entirely a matter between local authorities and their tenants, the grievance is so widespread and severe and the situation is so common to all local authorities that it makes sense for the Department of the Environment to devote a little time and effort to seeing whether it can do anything about it, above all in an age when we are all obsessed with the necessity to conserve energy.

I ask the Minister, therefore, to endeavour to collect those figures, to consult the Department of Energy about them, to bully the Department of Energy into producing an up-to-date version of its booklet and to carry on producing those booklets, and to give my constituents a ray of hope that they might in the future need to pay no more than other people in the country for the quantity of heating and hot water which they get.

1.49 pm
The Under-Secretary of State for the Environment (Mr. Geoffrey Finsberg)

I shall draw the attention of my colleagues in the Department of Energy to the comments of the hon. Member for Islington, South and Finsbury (Mr. Cunningham) about the publication to which he referred.

I am grateful to the hon. Gentleman for raising the question of heating charges in local authority properties. It is a matter of great concern to tenants, not merely in his constituency but in other parts of the country. The statutory responsibility for the management, regulation and control of council housing rests with the local authorities concerned. It is for each local authority to decide whether to install central heating in its dwellings and, if so, what form that heating should take—for example, the type of system and the type of fuel to use.

When authorities decide to install in individual dwellings solid fuel or gas-fuelled central heating or electric heating, the tenant is responsible for paying, for example, the gas or electricity board for the fuel that he uses, in the same way as is any other consumer. However, that is not the basic point that the hon. Gentleman is making. He is saying something different, and I shall come on to that and be as helpful as I can.

The hon. Gentleman and I know that it is not uncommon for local authority dwellings to be served by some form of collectively provided, landlord-controlled heating. Communal central heating is frequently found in blocks of flats where there is one heat source per block.

With communal heating, the main determinants of the cost to the tenant would be the reasonableness of the price that the local authority pays the suppliers of the fuel, how it apportions charges among tenants and the efficiency of the system. I shall leave aside what the hon. Gentleman said about architects, but he will recall various remarks that I have made about architects and planners in a different context.

The price of the fuel depends on general pricing policies and the terms of the particular contract which the local authority is able to negotiate with the fuel boards, oil companies or local suppliers. When faced with the fuel originally chosen for a particular system appearing to escalate in cost out of line with others that are available, it is up to the local authorities to decide whether to change the fuel or to take other steps to make the system more economic. It is difficult for them to reach a realistic decision in the light of constantly changing comparisons between fuels, and a decision to change fuels is normally the most expensive option for an authority. It would normally be wise for a local authority to consider introducing more reliable metering and to seek to improve the efficiency of the heating system before considering changing the fuel.

With communal heating, the total fuel costs must be apportioned between, and charged to, those tenants for whom heating is provided. That can be done in one of two ways. The authority can either impose a notional, flat rate, average charge for heating or employ some form of heat metering system which will relate the heating charge to the actual amount of heat used. The choice is entirely a matter for the authority concerned.

Ideally, apportionment of the charges should be on the basis of payment for fuel used and should provide an incentive to save fuel. The evaporation heat meters generally used have, however, long been suspected to be inaccurate. The Building Research Establishment has been examining that important problem and it is hoped to publish a report towards the end of the year.

If the system is inefficient, the options would include insulation, introduction of controls, and possibly a change in the system of heating to, say, individual heating. For example, electric heating has often been installed in the past because of the comparatively low capital cost, which has, however, been more than offset by steep rises in running costs.

My Department chaired the joint working party on heating and energy conservation in public sector housing which in 1978–79 issued domestic energy notes 1 and 3 on electric heating, which emphasised the importance of high standards of insulation and other measures to reduce heat loss.

The note gave advice on efficient operation and on improved controls as ways of achieving acceptable comfort at reasonable cost and covered the overhaul, repair or extension of the heating system, stressing that replacement should be the last resort.

I stress that I do not intend to be provocative, but the hon. Gentleman made the important point that heating jobs are often repaired, re-repaired and repaired yet again. Frequently, such work is done by directly employed labour and in those cases there is no redress. If the job is done by an outside contractor and the specification is properly drawn up, it ought to be possible for the local authority to make certain that the work is put right at no cost to the council.

Mr. George Cunningham

I assure the hon. Gentleman that in my area most of such work has been done by private contractors and the number of mess-ups has been considerable. The employment of private contractors is no solution to the problem. I should much rather have work done by a direct labour department than by most of the private contractors with which I have had to deal.

Mr. Finsberg

We must agree to differ on that matter, but if a contract is properly drawn up it ought to be possible to get the work put right at no cost. Perhaps contracts have not been as watertight as they should be. However, although I can be provocative on occasions, I was not intending to be so today.

The priority that authorities give to central heating work is a matter for them. The note stressed that whatever decison the local authority makes should ensure that tenants are consulted at all stages and that their views are taken fully into account. In particular, adequate information should be given to tenants in non-technical terms about the operation of the system.

Responsibility for maintaining central heating installations rests with local authorities, but the cost is met by tenants, as the hon. Gentleman graphically illustrated, either directly through heating charges or indirectly through council rates.

The Government would not expect local authorities to levy charges for heating that would result in a surplus, but we consider that they should aim to cover the full operating costs of a heating scheme.

The hon. Gentleman said that comparisons between updated figures from the Department of Energy and the charges in two local authorities show that something is out of balance. Again, I am trying to be purely factual, but the hon. Gentleman knows that if a local authority tenant exercises his right to buy his flat he will have the same right as the owners of flats in private blocks to challenge the local authority's estimate of service charges. It is worth thinking about that issue.

Mr. George Cunningham

Why should a person not have that right as a council tenant?

Mr. Finsberg

We considered that point and produced a tenants' charter. I referred earlier to the consultation that needs to take place if a local authority is to make major changes.

The hon. Gentleman argued that in the public sector tenants are limited in what they can do to help themselves and, although we have taken steps to allow local authorities greater freedom in allocating their resources, we recognise that the Government have their part to play, in particular in aiding householders to improve the insulation of their homes.

The hon. Gentleman quoted from the Department of Energy booklet on home heating costs. It contains excellent and impartial advice, which is still relevant, on the practical benefits of better insulation, draughtproofing and the lagging of hot water tanks.

We must all try to reduce the amount of energy that we use—by careful husbandry, by reducing the heat loss in our homes by insulation and draughtproofing and, when the opportunity arises, by choosing efficient heating appliances which are suited to our needs. The Department of Energy booklet from which the hon. Gentleman quoted did not have up-to-date heating costs, but it still illustrates well the difference that insulation, for example, can make to the annual fuel bill.

Through the homes insulation scheme we have made available grants to local authority tenants, as well as to those in the private sector. Every tenant who lives in a house with an uninsulated loft can apply to the authority for a grant of 66 per cent. of the cost, up to a maximum of £65, and all elderly tenants on limited means can apply for a 90 per cent. grant, up to a maximum of £85. I am very much concerned to see the grant reach those most in need.

The hon. Gentleman asked that we should look at a position that he finds unsatisfactory. I have carefully noted his suggestion that there should be a study of the issue, which, if it went ahead, would have to run across the Departments of Energy and the Environment and the local authorities. I shall give his idea the serious consideration that it deserves.

I hope that the hon. Gentleman will agree that it has been very useful to air the issue. I am grateful to him for giving the House the opportunity to discuss it. I am also grateful for his suggestion, which I promise to examine personally.