HC Deb 13 June 1988 vol 135 cc132-9

Amendment made: No. 246, in page 33, line 41, leave out 'Housing Corporation ("the Corporation")' and insert `Corporation'.—[Mr. Waldegrave.]

Mr. George Howarth (Knowsley, North)

I beg to move amendment No. 82, in page 33 line 43. at end insert — `Where the expenditure incurred has been financed by a loan from a local authority, the grant shall be paid to the local authority'.

Mr. Speaker

With this it will be convenient to consider new clause 33—Housing association grant on schemes sponsored by local authorities'.—(1) Housing association grants shall be available under section 45 of this Act for housing associations schemes funded by local housing authorities within the meaning of section I of the Housing Act 1985. (2) The terms under which housing associations grants are available for such schemes shall, taken as a whole, be not less favourable to housing associations than the terms in respect of schemes directly funded by the Housing Corporation. (3) The Housing Corporation shall consult on grants for housing association schemes funded by local housing authorities with such associations as appear to them to be representative of such housing authorities and housing associations as regards:

  1. (a) the amount of grant available;
  2. (b) the procedures to be followed in relation to applications for grant;
  3. (c) the circumstances in which grant is payable;
  4. (d) the method for calculation and any limitations on grant;
  5. (e) the manner in which and time or times at which grant is paid.'

Mr. Howarth

The Government have tried to constrain or prevent local authorities from funding housing associations directly. It seems rather strange that the Government should try to carve out a new role for local authorities as a strategic authority—they do not envisage local authorities being landlords on any great scale—while removing their ability to fund other bodies such as housing associations.

Many of us who have been deeply involved in housing for many years—as I have been, on Merseyside—have witnessed the good results of local authority funding of housing association schemes for the elderly and general family need, for example.

There is a more alarming point. I have here a letter from the chief officer, programme and operational support division, in the Housing Corporation, who was asked to comment on whether the Housing Corporation would be able to fund housing co-operatives. Housing co-operatives involve the same funding mechanism as housing associations. In reply to the National Federation of Housing Co-Operatives, he concluded in his letter dated 9 May 1988: In these circumstances, given the potential magnitude of calls upon our ADP resources, we have concluded that we have no option but to draw the line. Our present view is that we will not use ADP funds to enable council tenants to opt out of council housing through the formation of housing co-operatives or indeed through other housing association mechanisms. In other words, the Housing Corporation's ability to fund housing associations to help council tenants, who often live in dreadful conditions or in bedroom spaces which are in short supply, will be constrained, so quite where the new initiatives in council estates and inner cities will come from, I am at a loss to understand.

Mr. David Alton (Liverpool, Mossley Hill)

I strongly agree with the hon. Gentleman. Does he agree that, on Merseyside, there are some good examples—especially in the city of Liverpool—of people grouping together to form a housing co-operative with help from housing associations? Without the funding that the hon. Gentleman mentioned, which can act as a catalyst and get them off the ground, there is no way in which people will be able to pull themselves up by their own bootstraps. It is not good enough to express the sentiment—the cash is needed as well.

Mr. Howarth

That is absolutely right. The hon. Gentleman will remember the tenant rehousing programme in the city of Liverpool, which was a good example of what he describes. The local authority funded people to establish a co-operative scheme. That will not be possible under the new arrangements. The Housing Corporation has confirmed that it will not substitute those resources. I find that staggering and worrying. The Government support such initiatives, but they are removing all the funding mechanisms which go through the Housing Corporation or local authorities as a result of which those initiatives can come to fruition. Quite frankly, I am not quite sure that the Government realise the difficulties that they will create on the outer estates and in the inner cities. Even at this late hour, I hope that they will reconsider their position and produce a positive response to genuine fears.

Mr. Waldegrave

The hon. Gentleman raised points about resources which are at the heart of a great deal of the measure. We are continuing our debate in Committee, which was a good debate, about what mechanism should be used and whether our original suggestion that the disadvantages of double scrutiny in Housing Association grant funding between the corporation and local authorities were so severe that we should cut through that by centralising it in the Housing Corporation. That had administrative gains, but there was the loss of pluralism in not having local authorities leading schemes. I well understand that everyone's capacity to do that depends on the resources available to them.

We are discussing the mechanism. I assure the hon. Gentleman that the clause as drafted enables local authorities to continue leading HAG-funded schemes and for the corporation to give the grants. It is our intention, as I announced on 23 May, that that should continue. We shall try to deal with the problem of double scrutiny that has irritated everyone, probably including the hon. Gentleman in the past when he was involved in these matters, by putting all that in the hands of the corporation.

Mr. George Howarth

Just to get the matter absolutely clear, is the Minister of State saying that the new clause as drafted will mean that local authorities can directly fund housing associations or co-operatives to house their tenants or anyone else in housing need?

Mr. Waldegrave

The Bill as drafted enables the Housing Corporation to fund housing association schemes which have been established by local authorities, as in the past. It makes no change to those arrangements except that the corporation alone will be responsible for vetting the scheme for grant which will help to speed things up. That will be done by the administrative arrangements. The local authority alone should be responsible for deciding whether public resources should be committed to it. Of course, they will be subject to normal capital controls, and there is also the separate argument about resources.

The Bill enables them to say, "We want to fund this housing association scheme to our housing investment programme allocation," as many boroughs in London, most famously the royal borough of Kensington and Chelsea, have done for many years, and, "We shall have only single letting." I take it that my hon. Friend's new clause and the Opposition amendment were really probing amendments to make sure that that will continue to be possible. I can repeat the assurances which I gave in Committee and there is no question about them.

Mr. George Howarth

Will the Minister answer another of my points? As recently as 9 May, the Housing Corporation said that it will not use ADP funds to support schemes that essentially rehouse local authority tenants. Therefore, in many cases the Minister's assurances will not apply. People in housing that is inadequate in one way or another will not be able to get housing association or housing co-operative schemes funded.

Mr. Waldegrave

The schemes will be for the local authority to decide, as at present, and the Housing Corporation will pay HAG funding as in the past. The only change is that the vetting and scrutiny will be done only by the Housing Corporation.

New clause 33 sought to give local authority associations the same right to be consulted on the HAG rules for local authority sponsored schemes as the housing association movement, which does not seem to be right. it should be for the local authority to lead on the schemes and for the housing association movement and for the Housing Corporation to decide on the details of the funding arrangements that finance the schemes. I hope that my assurances which meet the points that were raised in Committee and the points raised by the hon. Member for Knowsley, North (Mr. Howarth) tonight will enable my hon. Friend and the Opposition to withdraw the amendments.

10.15 pm
Mr. Alton

Before we move on, I should like to comment on one or two of the points made by the Minister. From my experience in Liverpool, where I was a housing committee chairman for some time and where we initiated a number of housing co-operative ventures, I am disappointed that the Government are not putting as much emphasis on the autonomous status of housing co-operatives as they are on housing associations. I agree with what the hon. Member for Caernarfon (Mr. Wigley) said about the general role of housing associations and how they can act as useful catalysts. I am an enthusiast for housing associations, but I would prefer to place the emphasis and the money on groups of tenants who would like to take control for themselves through the establishment of housing co-operatives.

I am disappointed that we are not creating mechanisms that give tenants a chance to take over for themselves and to be able to establish and manage their housing co-operatives. We ought not to be placing obstacles in their way. I should like to see more resources allocated through the housing investment programme direct to council tenants. I do not believe that the Government have thought the matter through sufficiently.

There is the problem of recalcitrant local authorities which do not agree with the Government's position. My authority was an example of that. For two years, it adamantly refused to allow groups of tenants who wanted to establish housing co-operatives to do so. I introduced a ten-minute Bill to give tenants the right to establish co-operatives in the communities in which they live. Only last week the Bishop of Liverpool, David Sheppard, and the Archbishop, Derek Worlock, presided over the opening of the Eldonians, a housing co-operative in the heart of Liverpool. It is on a site that the tenants had to fight tooth and nail to acquire. They had to fight against all the odds, including the local authority, which tried to prevent them from obtaining the site. Now, the old Tate and Lyle site at Love lane in Liverpool is an exciting new housing co-operative. I pay tribute to the Government for their part in helping the tenants achieve that.

Mr. Waldegrave

The hon. Gentleman was generous enough to forestall me. I had an exciting visit to the Eldonians the other day. Ironically, I was pressed strongly —we were able to accede to the request—to have the land transferred into the development corporation areas because it was felt that there would be much more co-operation. I hope that that will be the case.

Mr. Alton

I do not deny that there will probably be greater co-operation. However, there is no local accountability through the Housing Corporation. The problem is that the tenants were not able, within their local authority, to establish a housing co-operative and obtain direct funding. It is not a question of coming under a development corporation or a local authority. The tenants wanted to be able to take control and establish their housing co-operative.

That is a good illustration of all the obstacles that can be placed in the way of tenants. I pay tribute to the Merseyside improved housing association for providing advice and helping the tenants through the minefield that they had to negotiate. These tenants are a classic example of what can be achieved by unemployed people most of them were unemployed—living in a rundown tenement block in the heart of one of the worst inner-city areas in the country. They were able to take over, but how much better it would have been if the resources, power and control had been given to that self-help group early on. How much better it would have been if the bureaucracy, red tape and obstacles placed in their path by the local authority and through the various planning consents they had to acquire could have been removed. A golden opportunity that could have been taken in the Bill has been lost.

Mr. George Howarth

The Bill seems to be moving from muddle to chaos. Our amendment seeks to mitigate that. Therefore, we will press the amendment to a Division.

Question put, That the amendment be made:—

The House divided: Ayes 184, Noes 234.

Division No. 349] [10.18 pm
Adams, Allen(Paisley N) Doran, Frank
Allen, Graham Douglas, Dick
Alton, David Duffy, A. E. P.
Archer, Rt Hon Peter Dunnachie, Jimmy
Armstrong, Hilary Dunwoody, Hon Mrs Gwyneth
Ashdown, Paddy Eastham, Ken
Ashton, Joe Evans, John(St Helens N)
Banks, Tony(Newham NW) Ewing, Harry(Falkirk E)
Barnes, Harry(Derbyshire NE) Ewing, Mrs Margaret(Moray)
Barron, Kevin Fatchett, Derek
Battle, John Fearn, Ronald
Beckett, Margaret Fields, Terry(L'pool B G'n)
Bell, Stuart Fisher, Mark
Benn, Rt Hon Tony Flannery, Martin
Bennett, A. F.(D'nt'n & R'dish) Foot, Rt Hon Michael
Bermingham, Gerald Foster, Derek
Bidwell, Sydney Foulkes, George
Blair, Tony Fraser, John
Blunkett, David Fyfe, Maria
Boateng, Paul Galbraith, Sam
Boyes, Roland Galloway, George
Bradley, Keith Garrett, John(Norwich South)
Bray, Dr Jeremy George, Bruce
Brown, Nicholas(Newcastle E) Gilbert, Rt Hon Dr John
Buchan, Norman Godman, Dr Norman A.
Buckley, George J. Golding, Mrs Llin
Callaghan, Jim Gordon, Mildred
Campbell, Ron(Blyth Valley) Grant, Bernie(Tottenham)
Campbell-Savours, D. N. Grocott, Bruce
Canavan, Dennis Harman, Ms Harriet
Carlile, Alex(Mont'g) Healey, Rt Hon Denis
Clark, Dr David(S Shields) Heffer, Eric S.
Clarke, Tom(Monklands W) Hinchliffe, David
Clay, Bob Holland, Stuart
Clelland, David Hood, Jimmy
Clwyd, Mrs Ann Howarth, George(Knowsley N)
Cohen, Harry Howell, Rt Hon D.(S'heath)
Cook, Frank(Stockton N) Hughes, John(Coventry NE)
Corbett, Robin Hughes, Roy(Newport E)
Corbyn, Jeremy Hughes, Sean(Knowsley S)
Cousins, Jim Hughes, Simon(Southwark)
Crowther, Stan Illsley, Eric
Cummings, John Janner, Greville
Dalyell, Tam John, Brynmor
Darling, Alistair Jones, Barry(Alyn & Deeside)
Davies, Ron(Caerphilly) Jones, Ieuan(Ynys Môn)
Davis, Terry(B'ham Hodge H'I) Jones, Martyn(Clwyd S W)
Dewar, Donald Lambie, David
Dixon, Don Lamond, James
Dobson, Frank Leadbitter, Ted
Leighton, Ron Rees, Rt Hon Merlyn
Lestor, Joan(Eccles) Reid, Dr John
Lewis, Terry Richardson, Jo
Litherland, Robert Roberts, Allan(Bootle)
Lloyd, Tony(Stretford) Robertson, George
Lofthouse, Geoffrey Robinson, Geoffrey
McAllion, John Rogers, Allan
McAvoy, Thomas Rooker, Jeff
McCartney, Ian Ross, Ernie(Dundee W)
Macdonald, Calum A. Ruddock, Joan
McFall, John Sheerman, Barry
McKelvey, William Sheldon, Rt Hon Robert
McLeish, Henry Shore, Rt Hon Peter
McNamara, Kevin Skinner, Dennis
McTaggart, Bob Smith, Andrew(Oxford E)
Madden, Max Smith, C.(Isl'ton & F'bury)
Mahon, Mrs Alice Soley, Clive
Marshall, David(Shettleston) Spearing, Nigel
Martin, Michael J.(Springburn) Steinberg, Gerry
Martlew, Eric Stott, Roger
Maxton, John Strang, Gavin
Meacher, Michael Taylor, Mrs Ann(Dewsbury)
Meale, Alan Taylor, Matthew(Truro)
Michael, Alun Thompson, Jack(Wansbeck)
Michie, Bill(Sheffield Heeley) Turner, Dennis
Millan, Rt Hon Bruce Vaz, Keith
Moonie, Dr Lewis Wall, Pat
Morgan, Rhodri Wallace, James
Morley, Elliott Wareing, Robert N.
Morris, Rt Hon J.(Aberavon) Welsh, Andrew(Angus E)
Mowlam, Marjorie Welsh, Michael(Doncaster N)
Mullin, Chris Wigley, Dafydd
Nellist, Dave Williams, Rt Hon Alan
O'Brien, William Williams, Alan W.(Carm'then)
O'Neill, Martin Wilson, Brian
Parry, Robert Winnick, David
Patchett, Terry Wise, Mrs Audrey
Pendry, Tom Worthington, Tony
Pike, Peter L. Wray, Jimmy
Powell, Ray(Ogmore) Young, David(Bolton SE)
Primarolo, Dawn
Radice, Giles Tellers for the Ayes:
Randall, Stuart Mr. Frank Haynes and
Redmond, Martin Mr. Allen McKay.
Aitken, Jonathan Budgen, Nicholas
Alexander, Richard Burns, Simon
Alison, Rt Hon Michael Butcher, John
Allason, Rupert Butler, Chris
Amess, David Carlisle, Kenneth(Lincoln)
Arnold, Jacques(Gravesham) Carrington, Matthew
Arnold, Tom(Hazel Grove) Carttiss, Michael
Ashby, David Cash, William
Atkins, Robert Channon, Rt Hon Paul
Atkinson, David Chope, Christopher
Baker, Nicholas(Dorset N) Churchill, Mr
Baldry, Tony Clark, Sir W.(Croydon S)
Banks, Robert(Harrogate) Colvin, Michael
Bellingham, Henry Conway, Derek
Bendall, Vivian Coombs, Anthony(Wyre F'rest)
Benyon, W. Coombs, Simon(Swindon)
Bevan, David Gilroy Cope, Rt Hon John
Biffen, Rt Hon John Couchman, James
Blackburn, Dr John G. Cran, James
Boscawen, Hon Robert Critchley, Julian
Boswell, Tim Currie, Mrs Edwina
Bottomley, Peter Davies, Q.(Stamf'd & Spald'g)
Bowden, Gerald(Dulwich) Davis, David(Boothterry)
Bowis, John Day, Stephen
Braine, Rt Hon Sir Bernard Devlin, Tim
Brandon-Bravo, Martin Douglas-Hamilton, Lord James
Brazier, Julian Dover, Den
Bright, Graham Dunn, Bob
Brooke, Rt Hon Peter Durant, Tony
Brown, Michael(Brigg & Cl't's) Dykes, Hugh
Browne, John(Winchester) Evans, David(Welwyn Hatf'd)
Bruce, Ian (Dorset South) Fallon, Michael
Buchanan-Smith, Rt Hon Alick Farr, Sir John
Buck, Sir Antony Favell, Tony
Field, Barry (Isle of Wight) MacKay, Andrew(E Berkshire)
Fookes, Miss Janet Maclean, David
Forsyth, Michael (Stirling) McLoughlin, Patrick
Forth, Eric McNair-Wilson, Sir Michael
Fox, Sir Marcus McNair-Wilson, P. (New Forest)
Franks, Cecil Malins, Humfrey
Freeman, Roger Mans, Keith
French, Douglas Marland, Paul
Fry, Peter Marshall, John (Hendon S)
Gale, Roger Marshall, Michael (Arundel)
Gardiner, George Martin, David (Portsmouth S)
Garel-Jones, Tristan Mates, Michael
Gill, Christopher Maxwell-Hyslop, Robin
Gorman, Mrs Teresa Mayhew, Rt Hon Sir Patrick
Grant, Sir Anthony (CambsSW) Meyer, Sir Anthony
Greenway, Harry (Ealing N) Miller, Sir Hal
Greenway, John (Ryedale) Mills, Iain
Gregory, Conal Miscampbell, Norman
Griffiths, Sir Eldon (Bury St E') Mitchell, Andrew (Gedling)
Griffiths, Peter (Portsmouth N) Mitchell, David (Hants NW)
Grist, Ian Moate, Roger
Ground, Patrick Monro, Sir Hector
Grylls, Michael Montgomery, Sir Fergus
Hamilton, Hon Archie (Epsom) Morris, M (N'hampton S)
Hamilton, Neil (Tatton) Morrison, Hon Sir Charles
Hampson, Dr Keith Moss, Malcolm
Hanley, Jeremy Moynihan, Hon Colin
Hargreaves, A. (B'ham H'll Gr') Mudd, David
Hargreaves, Ken (Hyndburn) Nelson, Anthony
Harris, David Neubert, Michael
Haselhurst, Alan Newton, Rt Hon Tony
Hawkins, Christopher Nicholls, Patrick
Hayes, Jerry Nicholson, David (Taunton)
Hayhoe, Rt Hon Sir Barney Nicholson, Emma (Devon West)
Hayward, Robert Onslow, Rt Hon Cranley
Heddle, John Oppenheim, Phillip
Hicks, Mrs Maureen (Wolv' NE) Page, Richard
Higgins, Rt Hon Terence L. Paice, James
Hill, James Patnick, Irvine
Hogg, Hon Douglas(Gr'th'm) Patten, John(Oxford W)
Holt, Richard Pawsey, James
Hordern, Sir Peter Peacock, Mrs Elizabeth
Howard, Michael Porter, Barry (Wirral S)
Howarth, Alan (Strat'd-on-A) Porter, David (Waveney)
Howarth, G. (Cannock & B'wd) Portillo, Michael
Hughes, Robert G. (Harrow W) Powell, William (Corby)
Hunt, David (Wirral W) Price, Sir David
Hunt, John (Ravensbourne) Raison, Rt Hon Timothy
Hunter, Andrew Renton, Tim
Hurd, Rt Hon Douglas Rhodes James, Robert
Irvine, Michael Riddick, Graham
Irving, Charles Ridley, Rt Hon Nicholas
Jack, Michael Ridsdale, Sir Julian
Jackson, Robert Roberts, Wyn (Conwy)
Janman, Tim Roe, Mrs Marion
Jessel, Toby Rossi, Sir Hugh
Johnson Smith, Sir Geoffrey Rost, Peter
Jones, Robert B (Herts W) Rowe, Andrew
Kellett-Bowman, Dame Elaine Rumbold, Mrs Angela
Key, Robert Ryder, Richard
King, Roger(B'ham N'thfield) Sackville, Hon Tom
Kirkhope, Timothy Sainsbury, Hon Tim
Knapman, Roger Sayeed, Jonathan
Knight, Greg (Derby North) Scott, Nicholas
Knight, Dame Jill (Edgbaston) Shaw, David (Dover)
Knowles, Michael Shaw, Sir Giles (Pudsey)
Lamont, Rt Hon Norman Shaw, Sir Michael (Scarb')
Lang, Ian Shelton, William (Streatham)
Latham, Michael Shephard, Mrs G. (Norfolk SW)
Lawrence, Ivan Shepherd, Colin(Hereford)
Lee, John(Pendle) Shepherd, Richard(Aldridge)
Lester, Jim (Broxtowe) Shersby, Michael
Lilley, Peter Speller, Tony
Lloyd, Sir Ian (Havant) Spicer, Sir Jim (Dorset W)
Lloyd, Peter (Fareham) Spicer, Michael (S Worcs)
Lord, Michael Stewart, Allan (Eastwood)
Luce, Rt Hon Richard Stewart, Andy (Sherwood)
Lyell, Sir Nicholas Sumberg, David
McCrindle, Robert Thorne, Neil
Macfarlane, Sir Neil Twinn, Dr Ian
Waddington, Rt Hon David Widdecombe, Ann
Waldegrave, Hon William
Walker, Bill(T'side North) Tellers for the Noes:
Wardle, Charles(Bexhill) Mr. Mark Lennox-Boyd and
Wheeler, John Mr. David Lightbown.

Question accordingly negatived.

Further consideration of the Bill adjourned. —[Mr. Kenneth Carlisle.]

Bill as amended (in the Standing Committee), to be further considered tomorrow.