HC Deb 02 November 1988 vol 139 cc1007-9
5. Mr. Campbell-Savours

To ask the Secretary of State for the Environment if he will exercise his powers under section 22(2) of the Local Government Finance Act 1982 to require the Audit Commission to direct the holding of an extraordinary audit into the accounts of Westminster city council relating to the disposal of the freeholds of 32 Smith square and 67 Tufton street, London, SW1.

Mr. Ridley

No, Sir.

Mr. Campbell-Savours

How else will we find out the truth? Does the Secretary of State know that, despite being pressed by Westminster councillors, Lord McAlpine, treasurer of the Conservative party, refuses to divulge any information about that transaction? What is he trying to hide? Why does he not let us have the figures or let us have sight of the documents so that we can stand the allegations up or the Conservative party can knock them down? All we want is the truth. Will the Secretary of State go to Lord McAlpine and ask him to publish the documents in the public interest? As a Westminster ratepayer, I want to know what is happening.

Mr. Ridley

I am delighted to give the hon. Gentleman such information as I have, including the figures. At the beginning of this decade Westminister sold quite a number of freeholds to sitting tenants. The freehold, plus the lease, is worth more combined than the two separately. The council's policy was to obtain 70 per cent. of the gain that arose from combining the lease with the freehold.

In the case of Smith square, the council sold a freehold valued at £60,000 for the sum of £1.325 million—a profit for Westminster ratepayers of about £1.25 million.

As for Transport house next door, the council sold the freehold of the Labour party's headquarters to the Transport and General Workers Union for £2.25 million—a profit for Westminster ratepayers of about £2 million. In the two transactions, the Transport and General Workers Union probably made a far bigger profit than Conservative Central Office on the sale of the lease. I quite understand why the right hon. Member for Islwyn (Mr. Kinnock), who is sponsored by that union, has not raised this particular question. He must know what a bonanaza that union has made by its very wise purchase of the freehold.

I can assure the House that the district auditor will give his views on whether the original transactions were made at the proper market value, as all those concerned believe they were.

Mr. Wilshire

Does my right hon. Friend agree that trying to score cheap party points off the sale of one property in Smith square is really bringing politics to an all-time low if Opposition Members do not admit to profits being made by their friends in the trade unions?

Mr. Ridley

I make no complaint about either transaction. I believe that they were both at proper market value, I am delighted that both purchasers and many others managed to take advantage of the rise in the property market later on. However, I believe that the Labour party should stop being so partial and selective.

Mr. Rooker

The Secretary of State is not telling the whole truth; he is misinforming the House. Is it not a lapse in accepted standards of conduct of public administration in this country when the governing party conspires with a local authority in a property transaction which, as the Secretary of State did not say in his reply, leads to the governing party making a profit of £2.4 million at the expense of ratepayers? That is what actually happened as a result of the transaction in 1983, which is not the transaction about which the right hon. Gentleman told the House. The governing party of this country made that profit. No other political party or trade union has been involved in making a profit further down the line.

Mr. Ridley

That really was lame. The hon. Gentleman knows full well that there was an interval between the two transactions, during which property values rose. He knows that the TGWU has made just the same profit over the same period, although it has not yet chosen to cash it in.

Mr. Speaker, if you are not able to call the hon. Member for Newham, North-West (Mr. Banks), who has been rising to intervene, let me say that I would ask him to withdraw the allegation that he made in his speech on Monday—column 728 of Hansard—that the sale of the freehold for Conservative Central Office was a scandal. I have now made it clear that it was not a scandal, and I hope that he will do the decent thing and withdraw that remark.