§ The Parliamentary Under-Secretary of State for Scotland (Lord James Douglas-Hamilton)
I beg to move,That the draft Housing Support Grant (Scotland) Order 1989, which was laid before this House on 15th December, be approved.
I know, Mr. Speaker, that a number of hon. Members hope to catch your eye this evening and I therefore propose to keep my opening remarks brief. Nevertheless, it may be helpful if I remind the House that housing support grant is a deficit subsidy that is paid to certain local authorities—
§ Mr. Speaker
Order. Will it be for the convenience of the House to take together the two motions on the Order Paper?
§ Mr. Donald Dewar (Glasgow, Garscadden)
Will we have a three-hour debate if both matters are taken together, Mr. Speaker?
§ Lord James Douglas-Hamilton
It would be sensible to take both together if the complete picture is fully to be understood.
§ Mr. Speaker
Then we shall discuss also the following prayer:That an humble Address be presented to Her Majesty, praying that the Housing Revenue Account General Fund Contribution Limits (Scotland) Order 1988 (S.I., 1988, No. 2081), dated 29th November, a copy of which was laid before this House on 7th December, be annulled.
§ Lord James Douglas-Hamilton
Housing support grant is a subsidy that is paid to certain local authorities to help them meet their council housing costs. To be more precise, it is a subsidy paid by the Government to those authorities which, on reasonable assumptions about the income and expenditure falling on their housing revenue accounts, would otherwise have an excess of expenditure over income.
Full details of the housing support grant settlement for 1989–90 are set out in the draft order and in the report which accompanies the draft order. The amounts of grant which will be paid to individual authorities are listed in annex C of that report. The House will wish to note that the total amounts to over £60 million. This is an increase of 11 per cent. over the £54.6 million which is being paid during the current year.
Before discussing in detail certain aspects of the settlement, I should record my thanks to the Convention of Scottish Local Authorities, with whom I have had full discussions about the settlement.
I mentioned earlier that the housing support grant calculations depend upon reasonable assumptions about local authority income and expenditure levels. These assumptions give rise to a certain amount of misunderstanding. They are crucial, however, to an understanding of how housing support grant is calculated and to the determination of the grant entitlements of individual authorities. It may therefore be helpful if I deal briefly with 800 each of the main items of income and expenditure associated with housing revenue accounts and describe the assumptions underlying the estimates.
The loan charges which we estimate authorities will pay in 1989–90 are based on a projection of each authority's capital debt to mid-1989–90, taking account of the estimated amounts of new borrowing and debt redemption. To calculate interest charges, we apply to these figures of capital debt the average interest rate expected for local authority borrowing in 1989–90. At present, this is estimated to be 10.2 per cent. I appreciate, however, that interest rates may fluctuate. I can assure the House, therefore, that if in practice interest rates are significantly different from our estimate we shall bring forward an appropriate variation order. At present, however, we estimate loan charges for all authorities in 1989–90 to be just over £464 million.
§ Mr. John Home Robertson (East Lothian)
The Minister just made an important statement to the effect that the Government will bring forward a variation order if there is what he rather quaintly described as a fluctuation in interest rates. How much of an increase would there have to be for the Government to reimburse Scottish housing authorities?
§ Lord James Douglas-Hamilton
It is customary to bring forward a variation order if there has been a significant change in the level of interest rates applying to local authority borrowing. This year, the latest estimate of the pool interest rate for 1988–89 is the same as it was when the 1988–89 order was made in January 1988. I have no plans, therefore, to bring forward a variation order for 1988–89 but, as I said, if there are significant changes in interest rates, we shall bring forward an order for next year.
The other major item of expenditure on housing revenue accounts concerns the cost of managing and maintaining the stock. For 1989–90, we have increased the management and maintenance assumption in the housing support grant formula by 8.5 per cent. I am pleased to tell the House that this is the third year in succession in which we have been able to adopt an increase which is higher than inflation. The per house allowance will rise from £333 during the current year to £361 in 1989–90, which should encourage further real growth in repairs expenditure.
On the income side, we are assuming for the purposes of the settlement that rents will increase by £1.48 per house per week over the 1988–89 order levels, bringing rents to £18.93 in order terms. This increase of 8.5 per cent. matches that of the management and maintenance assumption. I invite the House to note this deliberate linkage, which reflects the fact that improved levels of service have to be paid for by increased rents.
I should also stress that, in making these assumptions, the Government are not seeking to fetter the discretion of authorities to make their own decisions about the level of rents and about the level of management and maintenance expenditure. We are making these assumptions for the purposes of calculating housing support grant and we do so in the interest of equity—to ensure that all authorities are treated fairly in the distribution of grant. We thus avoid an authority receiving more grant because it is inefficient at carrying out repairs, so loading up its housing revenue account with maintenance expenditure. Similarly, 801 if an authority chooses to set a higher rent to improve the levels of service it provides to its tenants, it may do so without being penalised in grant terms.
§ Mr. Dennis Canavan (Falkirk, West)
The Minister mentioned rent levels. Is he aware that, since the Government came to power, council house tenants in Scotland have suffered rent increases of 230 per cent.? In view of that, how can the Minister possibly justify a situation in which out of the 56 housing authorities in Scotland, 33 will not receive a single penny in housing support grant and 48 will be prohibited from taking a single penny from the general fund for the housing revenue account? How on earth can the Minister possibly justify that vicious attack on the living standards of council house tenants?
§ Lord James Douglas-Hamilton
My first point in reply to the hon. Gentleman relates to the formula. Essentially, the amounts of housing support grant payable are derived from an assessment of the expenditure and the income falling on local authority housing revenue accounts in 1989–90. The means by which the various items of such expenditure and income are estimated are set out in the report accompanying the order, and the way in which the HSG is calculated is known as the HSG formula.
§ Lord James Douglas-Hamilton
If the hon. Gentleman wants me to spell out the formula in greater detail and explain how it works, I would be pleased to do so.
The Government choose an average rent level and an average level of management and maintenance expenditure which they consider reasonable for all authorities. Those reasonable levels are known as the HSG assumption, and the Scottish Office recalculates the housing revenue account of each authority using those assumptions about rent levels and management and maintenance expenditure.
The hon. Member for Falkirk, West (Mr. Canavan) wants to know why we use assumptions rather than actual figures. I will give him an example. The average expenditure per house in 1988–89 in Aberdeen is £294, but it is £552 in Dumbarton. That does not necessarily mean that Aberdeen is more efficient than Dumbarton. Levels of expenditure depend not only on efficiency, but also on political decisions about the level of service to be provided and on technical decisions about the extent to which repair programmes should be capitalised. That is why we use the assumptions to which I referred.
If there is still a deficit on the recalculated account, that deficit is made up by paying an equivalent of housing support grant to the authority concerned. The main factor in determining whether an authority receives a housing support grant is its level of loan charges.
The hon. Member for Falkirk, West asked why rents have increased so much and he referred to a figure of 230 per cent. Rents have indeed risen by more than the level of inflation since the Government came to power. However, that reflects the artificially low rent policies that many Scottish authorities maintain at the expense of their ratepayers.
§ Lord James Douglas-Hamilton
The hon. Gentleman disputes that. I will give him the figures. On average, the rents for local authority tenants in Scotland are £2.55 less than those paid on average south of the border. The estimated average rent increase for this year will be less than that for last year. We calculate that the rise last year was £1.65 and that the estimated average rent increase for 1989–90 will be about £1 .30 to £1.34.
§ Mr. Ron Brown (Edinburgh, Leith)
Why is Edinburgh district council treated so disgracefully while the Scottish Development Agency, a Government body, is given finance that is essentially a subsidy for Barratt, which will benefit in a part of Edinburgh known to the Minister—West Pilton Circus? The company will make a vast profit.
Does the Minister think that that is a good thing, or does he realise that it is one of the cynical cons repeatedly condemned by the people of Edinburgh?
§ Lord James Douglas-Hamilton
I am proud that, when West Pilton was in my constituency rather than that of the hon. Gentleman, I invited the SDA chairman and chief executive down. Through their intervention, considerable environmental assistance was given so that an adventure playground could be built. The SDA has continued the tradition, and I am very glad that it is assisting with urban regeneration projects in the hon. Gentleman's constituency which I believe will benefit his constituents.
Our calculations in December suggested that an increase of about £1.73 would be sufficient to allow Edinburgh district council to make a small but real improvement in the services that it provides for its tenants. While rises in interest rates may now suggest a slightly higher increase, the figure suggested by the council's Labour group appears excessive. Tenants should be in no doubt that, if rents are increased by the threatened £4 a week, it was the council—not the Government—that imposed an increase on that scale.
§ Lord James Douglas-Hamilton
I should like to go on. I shall listen to the hon. Gentleman's speech and reply to him when I wind up the debate.
I must repeat that, despite the increase in housing support grant for 1989–90, it is the Government's policy to reduce indiscriminate subsidies to council housing so that resources may be concentrated on capital investment, and to target money towards individuals who need it. This year housing benefit in Scotland is expected to reach £623.8 million. We are limiting contributions that authorities may estimate to make to their housing revenue accounts from their general funds. Hon. Members will have noted that for 1989–90 the limits on such contributions have been set at £3.5 million in aggregate. That compares with limits totalling £22 million this year and an outturn figure of £42 million in 1987–88.
I make no apology for those figures. The progressive reduction in the amount of general fund contributions means that authorities can no longer maintain rents at unreasonably low levels by systematically subsidising their housing revenue accounts at the expense of their ratepayers. In achieving that position, I believe that we have put the finances of council housing on a much sounder basis. Housing support grant remains to help authorities that have particular difficulties in meeting their loan charges because of historically acquired debt; but 803 indiscriminate subsidies to tenants, regardless of their ability to pay for their housing, have been substantially eliminated. Because rents are now at a more realistic level, council tenants can look forward to a real improvement in the levels of service provided by their landlord.
§ Lord James Douglas-Hamilton
Housing benefit in Scotland this year is expected to be more than £623 million. That is not being obnoxious to the council tenant, but targeting subsidy to those who need it. If mortgage tax relief has continued to rise, as indeed it has, it is largely because the Government have enabled many more people to buy their own homes. We believe that that fits in with the aspirations of the Scottish people.
I welcome the fact that local authority rents are able to make a greater contribution towards meeting housing costs—
§ Lord James Douglas-Hamilton
No. Many hon. Members wish to speak, and I want to develop the points that I am making.
Let me return, however, to our proposals for general fund contributions in 1989–90. As I have said, the aggregate of the limits on contributions amounts to £3.5 million and positive limits have been allocated to eight authorities. The contribution limits have been calculated to ensure that the average rent increase in those authorities can be restricted to £2 per house per week, or that the average rent can be held to £20.50 per house per week. The calculations are based on the Scottish Development Department's estimate of the loan charges which each authority will face in 1989–90. They assume that there will be an increase of 8 .5 per cent. in authorities' management and maintenance expenditure over the levels for which they themselves budgeted in 1988–89. Let me emphasise that we are working from authorities' own figures, as reported to CIPFA—the Chartered Institute of Public Finance and Accountancy. Those calculations are therefore as realistic and as accurate as we can make them.
I should also stress that in no sense should the maximum £2 per house per week increase be regarded as a norm or standard to which authorities are expected to conform. It is not the business of this Government to set local authority rents. Authorities will be making their own decisions about the levels of management and maintenance expenditure in their area and about the rents which they will need to set in order to balance their housing revenue accounts.
Finally, I should like to touch briefly on the combined effect of the subsidy proposals before us tonight. I calculate that the overall effect of housing support grant and general fund contributions on the housing revenue accounts of local authorities in Scotland will be to generate an overall rent increase of around £1.34 per house per week.
§ Mr. Graham
Can the Minister tell the tenants of the Scottish Special Housing Association—which the Minister controls—why he is putting their rents up by an average of £1.88, when they already have some of the highest rents in Britain?
§ Lord James Douglas-Hamilton
The rents of SSHA tenants will not be as high as tenants of new towns and certainly will not be as high as those of many housing association tenants. The estimated average rents of SSHA tenants for 1989–90 will be £20.82. The estimated average rents for Scottish local authority tenants will be £17.57 and for new town tenants £21.26.
I express my conviction that the fact that there has been an increase for the SSHA tenants will mean that there will be a considerable amount to spend on management and maintenance.
If authorities decide to increase rents by more than the figures we have calculated—
§ Lord James Douglas-Hamilton
I shall listen carefully to what the hon. Gentleman says in his speech, and I shall be happy to respond to it in my reply.
This order relates to local authorities. If the authorities decide to increase rents by more than the figures we have calculated—for example, to meet expenditure on management and maintenance increased by more than the 8.5 per cent. we have assumed—this is their prerogative. But I emphasise that that will be the authorities' own decisions, and that high rent increases are not being imposed by the Government. An average increase of £1.34 per house per week would be rather less than the amount of the increase last year. That would bring average local authority rents in Scotland to £17.57 per week. I do not regard that as unreasonable. It is well below the current year's average council rent of £18.78 in England arid Wales. It is also substantially below current rent levels in housing association, SSHA and Scottish new town houses.
The hon. Member for Motherwell, North (Dr. Reid) made an interesting contribution to the debate. I was, of course, forewarned about what he would say, because much of his speech was reported in advance by last Wednesday's Evening Times. Indeed, this debate was reported as having taken place, which was no doubt attributable to the hon. Gentleman's pioneering approach in favour of exclusive journalism.
I must tell the hon. Gentleman that a tribute was paid to him by the Leader of the House, who said:The detailed speech that the hon. Member for Motherwell, North (Dr. Reid) appears to have made in the House in the early hours of the morning and which is set out with such cogency and clearness by Mr. Hernon is a tribute to the hon. Gentleman's foresight rather than an indication of the hours that he keeps in the House."-[Official Report, 19 January 1989; Vol. 145, c. 488.]
§ Dr. John Reid (Motherwell, North)
I thank the Minister for raising this matter, which is testimony to the efficiency of my press operations and the absolute incompetence of the Government in cancelling the debate in the first place. Lest the Minister is disappointed, my name is down to speak tonight and I shall ram every one of those words down his throat.
§ Lord James Douglas-Hamilton
I was just about to say that I looked forward with interest to discover whether he would use the same speech, but I am grateful, at least, for the opportunity to respond tonight.
The hon. Member for Motherwell, North complained about excessive rent increases and about the lack of housing support grant for Motherwell district council.
§ Mr. Dick Douglas (Dunfermline, West)
On a point of order, Mr. Deputy Speaker. Perhaps you could explain how the Minister will reply at the end of his speech to the interventions that hon. Members have made, if he is now to reply to a speech that has not been made?
§ Lord James Douglas-Hamilton
The article appeared under the headline:Rents rise hammers the Scots
I am glad of the opportunity to reply to the hon. Gentleman. Despite the absence of housing support grant, Motherwell district council has consistently maintained rents at a level substantially lower than the Scottish average. The management and maintenance expenditure of the council is also well below the Scottish average. In effect, the council's low-rent policies are restricting the levels of service that it provides to its tenants.
It is, of course, within the council's discretion to take such a course of action, but I do not believe that we would be justified in providing subsidies to maintain that situation.
§ Lord James Douglas-Hamilton
I shall not give way, but I look forward with great interest to the hon. Gentleman's speech, which I shall follow carefully.
I believe that the proposals considered tonight constitute a fair and reasonable subsidy package. They set an acceptable balance between the interests of the council tenant, the community charge payer and the taxpayer. We have consulted the authorities in detail about the orders, and I commend them to the House.
§ 11.3 pm
§ Mr. Donald Dewar (Glasgow, Garscadden)
One of the differences between the Minister and my hon. Friend the Member for Motherwell, North (Dr. Reid) is that my hon. Friend writes his own scripts, which has some virtue.
I thought, however, that the Minister organised and shuffled his many bits of paper with unusual dexterity and I enjoyed some of his remarks. It is always fascinating to know-it has never struck me before-that the way in which the housing support grant is calculated is known as the housing support grant formula. That is a gem worth preserving.
The Minister then plunged into a remarkable farrago of nonsense about notional figures, bordering on myth, as he dealt with the way in which the formula works.
§ Sir Nicholas Fairbairn (Perth and Kinross)
I am interested in the concept of notional figures based on myth. If the hon. Member for Motherwell, North (Dr. Reid) writes his own script and delivers notional speeches that were never given, but were nevertheless published in the press, and does not admit that that is a misleading and dishonest thing to do, why are we worried about myth?
§ Mr. Dewar
All I can say is that I welcome the presence of the hon. and learned Gentleman. It is refreshing to see him here as he is one of the great entertainers of the place. I hope that he will contribute later.
One of the problems that we face is that we get locked into debate on specific orders. Each of the litany of orders is taken as a whole and debated intensively. The danger is that we may lose sight of what has been happening to housing in Scotland. If we try to achieve some sense of perspective, it is clear that the situation is deeply depressing and that some of the carefully presented figures used by the Scottish Office represent no more than creative accountancy, which does not disguise the fact that housing has been harder hit than any other sector or that the prejudices of Government have directly impacted on the lives of our constituents.
There are many myths, some of which are at the basis of the Government's approach. In Conservative circles there is still a feeling that council house tenants are heavily subsidised. All too often in ministerial minds, and certainly in the minds of Conservative Back Benchers, the word "subsidy" becomes associated with the term "lazy". We are told that the system is corrupt. I recall the Secretary of State for Scotland making a dramatic speech in which he said that local government finance was a corrupt system designed to favour people who voted Labour, in a tendentious attempt to suggest that the local government finance system is one of the ways in which the dependency culture is perpetuated. I believe that that is to misrepresent and misunderstand in a grotesque and wounding way.
Despite the special pleading of the Minister, there is a painful contrast between the treatment of public-sector tenants and that of owner-occupiers. Tax relief on mortgages constantly escalates. It is difficult to defend a system in which the value of one's mortgage increases with one's income and in which anyone with a substantial middle-class income would receive genuine advice from his accountant that he-should plunge into the maximum debt that he can raise. We all know that that is a crazy system, and the Minister wisely did not try to defend it.
I understand that the best estimate of the cost to the Treasury of mortgage tax relief in 1984–85 was £3.5 billion. In 1988–89 it has gone up to £5.25 billion. That is certainly an under-estimate, because it has not caught up with the recent escalation in interest rates. It is difficult to calculate a Scottish figure because the statistics changed in 1982–83 with the introduction of MIRAS. However I understand from the Library, using the family expenditure survey, that the figure is probably just under 7 per cent. of the total—an annual figure of perhaps £350 million. When we compare that with the £55 million or £60 million that will be spent on housing support grant, the point is eloquently and brutally made. I find the Minister's attempt to use housing benefit as an alibi totally unconvincing.
§ Mr. Douglas
My hon. Friend has failed to remark on an additional advantage to the owner-occupier, particularly in cities such as Edinburgh where the capital value of the assets have increased in the past year. An article in the property page of last week's edition of The Scotsman shows enormous increases in capital value which cannot be available to council tenants.
§ Mr. Dewar
That is a fair point. I am strongly in favour of helping people to get into home ownership if they so wish. However, I object to a system which is designed to 807 help those who are already prosperous, who are almost certainly already property owners and who will use the system as a tax advantage and not as a way of broadening the base of what was once called the property-owning democracy.
For the Minister to use housing benefit as an alibi is a joke. Housing benefit provides help for the lowest income group in distress. By pushing up rents, as the Minister is determined to do, more people will be forced into the housing benefit net. No doubt he will then parade it as evidence of the Government's generosity, and the whole process will become a pathetic intellectual fraud.
§ Mr. Dewar
I hardly imagine that the Minister is not aware of my answer. No, I am not in favour of doing that, but I am in favour of spending money to help those in need of help to get into the home-ownership market. I should have thought that in his better moments, the Minister might have taken some interest in achieving that end.
The Government's approach to housing is not even-handed. The public sector is being manipulated in a way that puts ever-increasing burdens on those who wish to continue to rent. The impenetrable good nature of the Minister is no consolation. I fear that he is a man who knows not what he does but who is prepared to accept it.
Housing support grant in the coming year will be £5 million higher than it is in the current year. That will be paraded by some people as good news, but if we look back to 1980–81 we find that we spent £228 million on housing support grant, whereas next year we shall spend only £60 million. That is a measure of the Government's indifference. In 1980–81 it made up 37 per cent. of total housing costs in Scotland. Next year it will be 7 per cent. and 33 authorities will receive no grant.
Let us take Glasgow as an example. In some ways it is the best case to take from the Minister's point of view, because it is one of the few authorities that is still receiving a significant amount of help. In 1980–81 Glasgow received £49.4 million, whereas in 1989–90 it will receive £27.8 million, in cash terms. In real terms that is a fall over that comparatively limited period of 65 per cent. For Scotland as a whole, in 1987–88 constant prices, between 1980–81 and 1989–90 the drop is from £338 million to £54 million, a fall of 84 per cent. Yet Ministers say that they are generous to the public sector and that they bring good news. We are creating a massive housing crisis. There is no way in which the Minister can hide that.
The general fund contribution to rents has dropped this year from £22 million to £3 million. I apologise for using so many figures, but they put into sharp perspective the reality of what is happening. In 1983–84, the figure was £125 million—18 per cent. of total housing costs. In the coming year the figure will be less than 1 per cent.
The Minister says, with almost breathtaking complacency, that he is not trying to set rents for authorities, but that does bear even the most cursory examination. It is a disgrace. It is not just an abstract entry in a municipal balance sheet. It means that rents, which have increased in nine years by over 230 per cent., as my hon. Friend the Member for Falkirk, West (Mr. Canavan) mentioned, will again be substantially increased.
The Minister does not convince anyone when he says that rents in Scotland are still below those south of the 808 border. I do not believe that anyone would accept as a rational argument the claim that everything south of the border has to be duplicated in Scotland. That is the whole point of having a different form of housing stock, a different form of local government finance and a different approach to the social responsibilities of providing housing. It is a puerile argument—one of which the Minister should be ashamed—merely to say that. on average, tenants in England pay £2.55 a week more. If one considered housing costs, wages and incomes per head in Scotland, one would find that the picture was very different.
The point, as Renfrew pointed out in its representations to a number of hon. Members last week, is that many local authorities are now reaching the stage where housing is entirely self-financing. That is extraordinary, particularly when we look at the contrast with the other end of the housing market. It has been done largely in order to keep down the poll tax in its first year of operation and to make a few political points.
Ministers are full of brave talk about choice, but choice for them has a very special definition. It is distorted and destroyed for those in the public sector who wish to exercise choice by continuing to rent. Renting has, quite deliberately, been made a very unattractive option for anyone who is above the rebate level. That cannot be defended.
The Minister may be a nice man. [Interruption.] A lively debate has broken out in the ranks behind me. I am prepared to accept that he is a nice man, although my judgment may be distorted by my knowledge of some of his predecessors. At one time, Opposition Members thought of having the Michael Ancram memorial meeting tonight, but we decided to resist the temptation. The Minister cannot wander into politics and not be answerable for what he does.
The structure of housing finance is now based more and more on sales and anticipated receipts. In 1989.90, the general fund contribution will be £3 million. Housing support grant will be £60 million. Borrowing in the normally accepted sense and authorised by central Government will be £125 million. On top of that, the standstill in real terms which is being allowed for this year includes £307 million from anticipated receipts of council houses. For the first time we have a redistribution of receipts. Thirteen authorities have been asked to give up £10 million of their receipts which are now being reallocated.
I shall encapsulate the point. In 1987–88, of the total sum available for housing in the public sector, about 33 per cent. came from the sale of council houses. In 1989 –90, only two years later, that figure went up to 71 per cent. That is an unsatisfactory basis on which to fund the totally inadequate effort, without commitment, to do something about the collapse of housing stock in this country and its impact on the individual living standards of many of our constituents.
§ Mr. Home Robertson
My hon. Friend is touching on a point of enormous interest in my constituency. East Lothian local authority, a comparitively small authority, is the hardest hit by the new concept of negative capital allocation. How can it possibly make sense for a small district council to pay the Government as much as £2.8 million of the proceeds of council house sales before it is 809 allowed to start to spend any capital funds on the renovation or building of new houses to meet the urgent housing need in that district?
§ Mr. Dewar
I accept entirely what my hon. Friend says. They are now real problems for many district authorities, and not just on the capital side. There is another important problem that I might mention, and I shall fall to that temptation. I refer to what is happening to homeless persons and to the provision of hostel accommodation. Perhaps my hon. Friend the Member for Edinburgh, South (Mr. Griffiths) will return to this point 2if he catches your eye, Mr. Deputy Speaker.
A reasonable man may think that this matter should be taken account of in the revenue support grant, but it is not. A few authorities are accommodated in the housing support grant calculation, but for many that do not have housing support grant, anything that they do for hostels and in trying to cater for the real problem of homelessness in the community must fall as a direct charge upon rent-paying tenants. I am told by the Scottish Council for Single Homeless—perhaps the Minister will deal with this point—that the figure in Edinburgh is as high as £1.27 a week for every tenant. That is an extraordinary figure. It shows the Government's absolutely deplorable failure—on occasions, I tend to under-use language; I shall settle for "deplorable"—to face up to their responsibilities in regard to homelessness.
If we put it all together—the tragedy and the impact upon the individuals to whom I have been referring and the problems on the capital side—it means the gradual and steady deterioration that every hon. Member can see in the statistics, incomplete through they are, and in our own constituencies, week in and week out.
In its brief report—I make no apology for quoting it—the Convention of Scottish Local Authorities gives the Government's figures for 1986 and suggests that, of the 843,000 council houses in Scotland, 88,000 require major rewiring, about 234,000 suffer from dampness problems of one sort or another, and 153,000 require major renovation and repair. Of course there are arguments about whether the figures are accurate. It is difficult to know, because the Government will not carry out a house condition survey. We do not even have a Select Committee on Scottish Affairs to examine the evidence and come up with authoritative estimates.
No hon. Member could in all honesty deny that the situation is deteriorating. Whatever rent level may be fixed, we are sliding towards asking people to accept housing that they should not be asked to accept and in which they cannot reasonably be expected to live. My district council, Glasgow, would be the first—it would want—to concede that even preliminary inspection of dampness problems may be put off for many months because of the pressure on limited resources and limited staff.
Sometimes I do not know what to say to a tenant who tells me that he has reported something which, rightly or wrongly, he believes is affecting the health of his children. Such people may wait for two or three months without anyone approaching them to deal with the problem. I know that the answer is that it will be some time yet before anything happens, and even when property is inspected it will be longer before the remedial work is carried out. That 810 cannot be satisfactory. It is worlds removed from the—at times—almost insufferable complacency with which the Government inspect their housing record. It is the result of 10 years of neglect by the Government—sins of omission and of commission.
Worse still, the Government seem to want to weight and distort their arguments and policies even further. Their arithmetic on housing finance is a cruel message to anyone who wants to remain in the public sector. That message is getting through, but should never have been sent out: those who live in council houses should be there only because they have nowhere else to go or cannot manage to escape. That is not choice, by any standard. It is the end product of the misconceived policies which the Minister has followed so slavishly and complacently in recent years.
We hear about the Government's commitment. Let us examine public expenditure on housing, as shown by Government figures. At 1987–88 prices, it was £866 million in 1982–83. In 1989–90 it will be £537 million, a drop of almost 40 per cent. If a real cut of 40 per cent. measures up to the enormity of the crisis, if it shows the sort of commitment about which the Secretary of State boasts, and if he is really the sort of Member who is proud to represent public sector housing as well as owner-occupiers, he should examine these figures, and then his conscience.
This is a tragic error. It is the wrong approach, carried out in the wrong way with the wrong social objectives. We believe in and want to create choice. We are not opposed to owner-occupation: it should be encouraged—but sensibly. On the other side of the equation, there should be genuine choice that can be exercised in decent conditions by people who do not want to buy and who want to continue to rent in the public sector.
We oppose the orders because they directly threaten to compound the errors that have accumulated over the past decade or so. If unchallenged and continued, they will inevitably deepen the real crisis that we face in Scottish housing.
§ Mr. Bill Walker (Tayside, North)
It was a bit rich of the hon. Member for Glasgow, Garscadden (Mr. Dewar) to talk about creative accounting, given that he is a member of the party that, between 1974 and 1979, introduced massive real cuts in local government and had to go to the IMF.
We also heard from the hon. Member for Motherwell, North (Dr. Reid), with his creative and enterprising mind. We always knew that he was one of the intellectuals of the Opposition, but even he was stretching the imagination by claiming to have participated in a phantom debate.
§ Dr. Reid
I am sure that the hon. Gentleman will forgive the eccentricities of a humble Back Bencher like myself, who was quoted on a speech that he did not make, but what would he make of a Government Department, such as the Scottish Office, responding in detail in the same article to the speech that I had not made in a debate that had not taken place?
§ Mr. Walker
I would say that, once more, the hon. Gentleman is indulging in fantasy and creative accounting. It is right and proper that some defence should be made to even a phantom debate because something that appears in the press does not appear to be phantom and it must 811 therefore be dealt with. That is why the other side of what appears in the press must be answered. It is no good just saying that the debate did not take place or "We didna ken it was on", because the fact is that the hon. Gentleman has been caught out and he must live with it.
The hon. Member for Garscadden referred to mortgage interest relief, which is just a continuation of what has gone on for many decades under successive Governments. If I heard the hon. Gentleman aright he was suggesting that the way in which the Government approach mortgage relief encourages people to enter into the maximum amount of debt. How can he explain the capital borrowings of local authorities, if that is not also entering into the maximum amount of debt? There is certainly a lot of creative accounting in that.
I remind the hon. Gentleman that tax allowance is exactly what it says—it is an allowance; it allows people to keep the money that they have earned whereas, quite properly, housing benefit is taxpayers' funds being directed to individuals in need. That is the difference. To pretend that the two are the same is to distort the truth.
It is interesting to note that housing support grant in Scotland will increase, as it has previously, from the figure of £54 .6 million to £60.4 million-an increase of over 10 per cent. That is a real increase. It is directed towards only 23 of our district councils—33 are outside the apportionment, including my own two district councils of Perth and Kinross, and Angus, and will not receive any of the £60.4 million. Once again, taxpayers in my constituency are seeing their funds directed to councils outside Tayside.
One should also consider the huge sums that are paid directly to individuals into the housing coffers from housing benefit. That is what my hon. Friend the Under-Secretary of State for Scotland was saying. The important point is that we are talking about the vast sum of £600 million-plus going directly into the housing coffers. It is creative accounting to pretend that that is not an aid to public sector housing.
One should recognise that at least this Government are working on both fronts. There is no question but that £600 million is a lot of money. Quite properly, that money is going to individuals in need rather than a blanket figure going to a statutory body. That is the difference between the Government and the Opposition. The Government recognise that those in council housing, local authority housing or public housing of any kind, who are in need of financial support because of their financial circumstances, quite properly, should be, and are being, assisted.
Anyone who has made any attempt to study public sector housing, will realise that two major problems have been management and maintenance. Many of the houses built in the past 30 years have been found to be badly designed and poorly built. That is why the repairs allocation of £361 per house is welcome. It is an increase of 8.5 per cent.—again, a real terms increase—and following two years of real increases, it must mean that many more repairs will be completed during 1989–90, which is to be welcomed.
I am sure that I am not alone in thinking that 73,700 houses improved in 1987, a greater number than in any of the previous 10 years, is welcome. Certainly, for people who have been living in sub-standard local authority houses, these improvements are welcome. When we add that number to the almost 332,000 local authority 812 dwellings, we find that almost 40 per cent. of the stock has been included in modernisation schemes at a cost of over £1,000 million.
For the Opposition to say that the Government do not care and have not directed any funds is a distortion of the facts. We can at least produce hope in Scotland, which is the finest part of the United Kingdom in which to live. The quality of life in large areas of Scotland is far superior to that in the south-east of England. We should be pleased to know that things are being done in parts of Scotland where they need to be done.
Many of the messages coming from the tenants say that local authorities are not always good landlords. Many dreams have been turned into nightmares by defects such as dampness and condensation, which have created health hazards and misery. Some of that was the direct result of bad management and lack of supervision by local authorities. Local authorities would not admit that dampness and condensation existed until they were proved wrong.
The Scottish Special Housing Association, the other public sector landlord, has also had substantial resources devoted to it to meet its needs and the demand for new houses. We have seen 7,500 new homes costing £485 million, and £930 million has been spent on 32,000 new and rehabilitated houses. At the same time we have seen a drop in the number of households renting in the public sector. That is welcome, because it means that people are buying their homes, and for the first time in decades the figure fell below 50 per cent. in Scotland, until today it stands at about 48 per cent.
Over 132,000 tenants have been able to buy their homes, and that is a direct result of the Government's legislation, which was opposed by the Opposition. The proportion of households owning their own homes has risen in Scotland from 35 per cent. to over 44 per cent. That is good news for the people who own their homes. The Opposition say that our record in office is not good. The Labour party's record in office was abysmal and ours is far superior.
Since 1979, the resources made available for improvement and repair grants have, on average, been seven times higher per year than during the years of the last Labour Government between 1974 and 1979. The Conservative Government have spent £77 million per year compared with the Labour Government's derisory £11 million per year. Between 1982 and 1984, the maximum rate of repair grant was boosted from 50 per cent. to 90 per cent. During that time, Scotland's cities were transformed and private sector stock in the stone-built tenements was restored to its original structural magnificence. That is true of Dundee and of many of our other cities. The inside of those lovely buildings was modernised to a standard beyond the dreams of the original builders. Over 272,000 grant applications were approved, and today the private sector stock stands at about 1 million dwellings. The number of houses below tolerable standard has been more than halved to fewer than 56,000. That is still too many and there is still much to be done, but to suggest that the Government are doing nothing is a travesty of the truth.
We are continuing our programme of improvements, new building and change. Part 11 of the Housing (Scotland) Act 1987 came into effect on 2 January this year. All new private lettings after that date will be assured or short assured tenancies. Under both forms of tenancy, landlords and tenants will be able freely to negotiate rents 813 before the start of the tenancy. That is choice. Scottish Homes will work in partnership with other bodies to develop new approaches in housing that are long overdue and very necessary. Scottish Homes will have the benefit of experienced staff from both the Housing Corporation and the Scottish Special Housing Association. This background of knowledge, expertise and experience should combine with the new powers and functions to give Scottish Homes the ability to achieve the change in quality for the life of tenants that has eluded local authorities since 1945.
The motion will continue that change. We introduced the tenants charter as part of the Tenants' Rights, Etc. (Scotland) Act 1980. It has granted public sector tenants several important new rights, such as the right to buy at generous discounts—the Opposition opposed that—security of tenure, the right to succession, the right to a written lease and the right to alter or improve one's home. To suggest that the Government have done nothing is nonsense. Now, tenants' choice and rights will be extended by the Housing (Scotland) Act, which will also allow them more responsibility.
Tenants in Scotland will have the opportunity to seek a new landlord and new forms of tenancy, if they so wish, without moving out of the houses in which they live. There is no compulsion, so this is choice. All the Opposition can do is wring their hands. One has only to look at the results of their stewardship between 1974 and 1979 to realise just how hollow are their speeches.
We, the Conservative Government, have improved conditions and increased choice, and have made it possible for many more people to own their homes, giving them the opportunity to pass a capital asset on to their children, an opportunity denied to them by previous Administrations. We continue to increase grants and choice, while the Opposition girn and greet and complain. Worst still, the Labour Opposition steal the clothes of the Scottish National party, and make them respectable, with the devastating results that we have seen in the recent opinion polls. That should be worrying the Labour party. Instead of shadow boxing, and making speeches in debates that do not take place, they should be working out how to become a real Opposition, one capable of alternative Government. They should be turning their minds to that rather than to the negative nonsense that we have heard this evening.
§ Mr. Michael J. Martin (Glasgow, Springburn)
It is important to remind the hon. Member for Tayside, North (Mr. Walker), and the Minister, both of whom talked about subsidies going to council houses, that council tenants are also taxpayers. They are not getting money for nothing. The hon. Member for Tayside, North spoke nonsense about mortgage interest relief, which is a blanket subsidy that goes to people who are not necessarily in need.
It is significant to note that just before Christmas there was a by-election in Glasgow. The successful candidate, the hon. Member for Glasgow, Govan (Mr. Sillars) promised the people of Govan that he would be here to defend their interests. Glasgow district council has been forced, because of the order, to increase rents by £4 a week but the hon. Member for Govan is not present to defend 814 the people of Glasgow. The hon. Member for Govan can afford any council rent rise because he writes for a dirty Tory rag.
§ Mr. Andrew Welsh (Angus, East)
The hon. Gentleman is playing a dangerous game. Only a quarter of his hon. Friends have bothered to turn up for the debate. My hon. Friend the Member for Glasgow, Govan (Mr. Sillars) is in Govan working for his constituents, which is what three quarters of Labour Members seem to have chosen to do. It is a silly game to play.
§ Mr. Martin
If I was in Springburn tonight, which I would like to be because I am a resident there as well as its representative, many people would be asking why I was not here defending their interests. The hon. Member for Govan should get his priorities right. He had tears running down his cheeks when he told the people of Govan what he intended to do for them, but he conned those people. He is interested only in writing for a Tory rag.
I listened with interest to what the Minister said about the standard of repairs. He was suggesting that some local authorities give too high a priority to the level of repairs and will have to cut down. The Minister knows that much of the council housing stock, particularly in Glasgow, Springburn was built after 1945 when the Government told the local authority that it would have to embark on building non-traditional houses. For example, we have the Blackburn houses and houses with hardly any timber because of those policies.
Until the 1960s, local authorities such as those in Glasgow were forced to build houses such as those on the Easterhouse estate because the Tory Government of the day told them to do so. Also, in the early 1960s local authorities were forced to build multi-storey housing. It is one thing to leave a tenant without rewiring or double glazing but how can the Minister expect a local authority to leave multi-storey flats without a lift so that people have to walk up 22 storeys? The only thing a local authority can do is use its housing budget to ensure that repairs such as that are carried out. If the Minister takes subsidies away from local authorities, he is forcing council tenants to accept more responsibility, and some of them do not live in the non-traditional houses.
Many of the non-traditional houses have flat roofs. With hindsight it is easy to say that no house that has to endure damp such as that in the west of Scotland should have a flat roof. We know that that leads to dampness problems. However, when they were being built, the architects—the experts—told local authorities to use flat roofs and they conned the Governments involved—usually a Tory Government—into providing subsidies for the building of such houses. As a result there were severe problems with damp. Hutchinson E type houses were an example of that, as were the Balgrayhill corridor-type houses in my constituency. The problems were so great that the Government have encouraged local authorities to put the traditional gable roofs back on.
That type of dampness has caused bronchitis. Those with chest complaints such as asthma have been forced out of their houses. It is unfair to force local authorities to say to these tenants, "It does not matter whether your son has chronic asthma; he will have to stay in the house." That is morally wrong. The Minister's comments about the level of repairs were extremely unfair.
815 There has been talk about the sale of council houses. I think that my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) will agree with me that some houses that were bought in Knightswood for £8,000 with discounts have since been sold for £38,000. The ex-tenants have moved to Bearsden.
§ Mr. Martin
But there are 8,000 unemployed in my constituency, and I am not the only Member who represents a constituency with such unemployment. Few of those who are on the dole can say, "I shall buy that house for £38,000." The hon. Member for Tayside, North need not talk to me about choice. There are many other tenants who are still sitting in council houses in Possilpark and Hamiltonhill who have been forced into that position.
There are other ex-tenants who have bought their house, and good luck to them. They have bought because the Government have forced up rents. The only option for many is to buy. But parents are coming to local councillors, myself and other hon. Members and asking, "Why cannot my son and daughter have a council house in the area in which they were born and bred?" The answer is simple: the council houses have been bought and the Minister will not allow any more local authority houses to be built.
The Minister had better put on his thinking cap. If he wants communities in areas such as my constituency, where there are still good, sound communities, he must ensure that if council houses are being sold at one end of the market, there is decent housing stock at the other for those who are in dire circumstances.
I came across a tragic case a few weeks ago of three members of a family suffering from cancer. The mother of the family was one of them. It was her dream to get a part of what everyone wants, the Swedish houses. Why not? She had spent 25 years in her house. She could not fulfil her dream because there was no ground floor accommodation available for her, which was what she needed because of her disability.
We say that we want to help the sick and the disabled and integrate them within the community, not isolate them. We should not be saying to tenants, "You are severely disabled and we are sorry, but you cannot have the house that you want in the community in which you have lived for 25 years."
The Minister should understand what he is doing with local government. There has been talk about 1974 to 1979, the period during which I was a councillor. I enjoyed much satisfaction from being able to get things done during those five years. There is evidence of the rehabilitation that took place in Glasgow. We saw the implementation of modernisation schemes in Knightswood and Govan, for example. Unfortunately, councillors are now suffering from despair because they do not have a decent budget. It is wrong to treat the dedicated in that way. Local government is a means of ensuring that there is proper housing, to provide people with a decent quality of life. Unfortunately, the Minister is removing that opportunity from almost every generation in Glasgow.
§ Mrs. Ray Michie (Argyll and Bute)
I have heard nothing tonight which leads me to believe that the number of letters that I receive about housing problems in my constituency will diminish.
The order goes nowhere near to tackling the housing problem in Scotland, and the Government continue to turn a blind eye to the housing crisis by understating the need for expenditure and overstating the level of income likely to be achieved. The Minister predicted that the average rent will increase by £1.34 a week, but already some increases are higher. In my constituency, the projected increase is £2 a week.
The Government have identified 356,725 houses which need to be modernised or improved. They are suffering from condensation, dampness, warped doors and windows and cracked fabric, inside and out. The £5 million increase in housing support grant is welcome, but it is destroyed by taking away £19 million of general fund contributions, leaving tenants to pay an extra £14 million to bridge the gap.
The average weekly rent in 1988–89 is £16.23—an increase of 10.8 per cent. over the last year. In Argyll and Bute, the average rent last year was £18 a week, and it is projected to rise to £20—an increase of 11 per cent. Rents are rising faster than inflation and contribute to the rate of inflation. The hon. Member for Falkirk, West (Mr. Canavan) has told us about the unbelievable 230 per cent. rent rise since 1979.
Part of the reason for the rent rise is the rise in interest rates, which is the result of Government policy to dampen a boom in the south-east of England. Scotland can go hang. The order seems a waste of paper. There is a long list of local authorities with the word "nil" against each. It would be easier to say that only five districts and three islands councils will receive anything.
I believe that the Government are attempting to worm out of their responsibilities by ignoring the need for investment in the public sector. Rents are rising so quickly that they are making renting unattractive. Are the Government pushing up rents just to encourage more people to buy their council houses? Many do not want to buy because their homes are in such poor condition, and the incidence of mortgage default is growing significantly. Can the Minister tell us, although perhaps not tonight, how much housing benefit is paid out in each local authority area and how much mortgage tax relief is given in the same area?
The most important and disturbing thing of all is the plight of the homeless. According to Shelter, the number of homeless people in Scotland last year was an appalling 29,185. It is unfair that local authority tenants should have to bear the cost of a statutory service which is used equally by all sectors of the community. Such costs should be met from the revenue support grant, which would spread the load more fairly. The Government have failed singularly to tackle the problem of homelessness. In my constituency the number of homeless has risen from 180 in 1984 to 308 in 1988. To an hon. Member representing Glasgow or Edinburgh, that may not be a large rise, but in small areas and pockets of my constituency that is a large increase. That is not even the true figure. It reflects only those who go to the local authority and officially declare themselves to be homeless. The figure does not include those people 817 who live in overcrowded conditions, single people or childless couples who have no legal rights under the homeless persons legislation.
Not only is the plight of those people a stain on a so-called civilised country; those people cause resentment and bitterness among local people, particularly in rural areas where everyone knows everyone else, because the people in greatest need are often allocated houses before people who have waited patiently for their turn on the housing list.
Genuinely affordable housing for single people is in very short supply. They will continue to make up an increasing proportion of the homeless. It is now not possible for many local authorities to secure sufficient permanent accomodation or to make what is available available quickly enough. Some authorities have to rely on costly temporary accomodation for longer and longer periods. Local authorities are unable to perform their statutory duties adequately. There is a decline in new building and renovation and that is reducing the lettings available to homeless families to say nothing about those on the waiting lists.
All that is compounded by a further problem which particularly affects rural areas. It was estimated in 1986 that there were 19,446 second homes in Scotland. There were three in Bearsden and Milngavie and 2,763 in my constituency, and that was the highest figure for any area in Scotland.
It is very sad to see wealthy people out-pricing locals by thousands of pounds. Young couples who cannot now afford those houses must give up jobs and homes because they cannot match the inflated prices. Therefore, we lose the indigenous population and a priceless heritage and culture. House upon empty holiday house is visited perhaps once or twice a year. In this day and age where money is the god, no one in the Government cares. The order will do nothing to help the housing crisis in Scotland.
§ Mr. Nigel Griffiths (Edinburgh, South)
The order does nothing for the homeless and even less for the tens of thousands of Scottish tenants living in terrible conditions. It turns the screw on people who rent and do not buy and it is yet another manifestation of the Right-wing extremism which is gripping the Tory party in Scotland. I have never seen the Minister responsible for housing in Scotland look so worried at the Dispatch Box nor the Secretary of State look so craven. The Secretary of State would sell out his own city to appease the new Right.
Never has Edinburgh had two Conservative Members of Parliament—two members of Government—who have done so little for its people, or so much to damage the reputation of our great city. While Glasgow's housing budget is receiving nearly £28 million from the Government this year, Edinburgh is getting nothing. While Shetland receives nearly £4 million, Edinburgh is getting nothing. Are there no homeless people in Edinburgh? Do Edinburgh's tenants not deserve fair treatment? Clearly not. If only the Minister and the Secretary of State treated Edinburgh in the same way as Glasgow—and that is far from generous—Edinburgh would get at least £8 million from the Government this year to help towards its budget for the homeless.
818 The Government's own figures show that in Scotland more than 88,000 houses need rewiring. Over 150,000 need major structural repairs. A quarter of a million are damp or have condensation, and over a third of a million need modernising. In each and every one of those houses, hundreds of thousands of Scots and their families are suffering from the effects of unmodernised houses with draughty and leaking windows and damp. That is the reality behind the Government's figures; those are the issues that the Minister has sought to dodge from the Dispatch Box.
Between 1986 and 1990 the Government will allow councils' spending on their capital accounts to fall from £200 million to £125 million. That will be the amount of their guaranteed borrowing. The plight of home owners who are still awaiting 90 per cent. grants is uncertain. The Minister will know from his mailbag, as I know from mine, that many of his constituents—like mine—will still not be guaranteed to receive a contribution towards "grant-aided" work. Some have been waiting for many years.
Figures have never been the Minister's strong point. The withdrawal of grants from Edinburgh district council, the cut in rent income resulting from Government policies and the Government's failure to help the homeless should have resulted in an average rent increase of £5 a week for every tenant in Edinburgh. But, through prudent management and cost-cutting measures, the district council has managed to cut the increase by a fifth. Revenue support grant, of which the Minister gave details earlier, has meant that that Labour council is having to squeeze even more value for money from its services and receive an even smaller contribution from the Government.
If the Government's calculations of what Edinburgh should be spending are correct, they are an insult to the people whom I represent. The figures in today's and last week's statements show that the Government are allowing Edinburgh to spend far less than other areas. The Minister thinks that Edinburgh should be spending only £214 per annum on services for each adult: £214 to keep the streets clean, stock the libraries and equip and staff the schools. Perhaps he will tell us why he is letting Dundee spend £226 and Glasgow £336, according to the Government's calculations. Those are the facts which the Minister seeks to dodge.
The Government's contribution to the poll tax in Edinburgh is, frankly, bare-faced robbery. They are allowing only £438 per head, which is £244 less than for Glasgow. That means that Edinburgh's poll tax payers are having to pay through the nose for council services. If they received equal treatment to Glasgow, instead of having to set a poll tax of £385, Edinburgh and Lothian councils would have to set a combined figure of only £151. It is sad that the Minister is now selling out Edinburgh, but it is typical of the Government bowing to the extremism which has now gripped the Tory party in Scotland.
The message that we have received today is that the Government care nothing for the tenants and even less for those groups who are under pressure because of Government measures. The Secretary of State's figures for the budget which deals in part with homelessness show the shameful record which he must defend, but which he is defending so inadequately. In the Labour Government's last year in office, they set a budget which at today's prices was £418 million, out of which councils were allowed to 819 spend money on the homeless. Under this Government, that has dropped to a grant of only £60 million, which is one seventh of its previous levels.
The Government's record on helping the homeless reflects that trend. We can see that their contribution has dropped from £418 million—out of which the homeless could receive some contribution—to £377 million in the Government's first year of office, to £243 million in their second year, £147 million in their third year and so on, until it now stands at £60 million. What the Government are doing to help the homeless in the Minister's own city —the capital city—is, as my hon. Friend the Member for Dundee, West (Mr. Ross) so rightly said, nothing at all. Yet the Labour Government were able to support Edinburgh—a Conservative council at that time-to a tune of £22 million in a direct contribution to its housing support grant, out of which the council could spend money on the homeless.
By 1983, the Government had cut that budget to zero and since 1983 they have given Edinburgh and its homeless not one penny. In fact, for seven years Edinburgh's homeless have received no help from the Government. In those years it has been left to the Labour council to show some compassion to the homeless. The Government have not even assisted the Labour council. They have stopped the Labour council taking any money from the rates and now any money from the general fund to help the homeless. That has caused Edinburgh's Labour council to look to a group of people whose incomes on average are lower than those of the population as a whole—the tenants. It is the generosity of the tenants of Edinburgh that has helped the homeless, who are less fortunate than themselves. Whether they be in the Grass Market, whether they have lost their homes because of mortgage repossessions or because of marital breakdown, those people are being supported entirely by Edinburgh, and that is a shameful record.
What we know from recent events, from the figures and the Government's abysmal record, is that we do not have a Secretary of State or Ministers who will stand up for the capital city, never mind for Scotland. We have never had such a Secretary of State and Ministers from Scotland who have done so little for their constituents or their home towns. What is all the more lamentable is that they have not been generous to other parts of Scotland—they have been Scrooge-like in the amount of money that they have given or allowed councils to spend. Considering the low level of spending and the extreme and pressing need in all parts of Scotland, it is shameful that they can do so little to help the capital city of Edinburgh. They appear to have taken money from Edinburgh and volunteered it to the Prime Minister, the Treasury and the fanatics who care not a whit for the homeless, not a jot for people who rent their houses and who appear to care less for Edinburgh than for any other area.
The important consequence of the debate is that the Secretary of State and the Ministers should be brought to account before the House for their mismanagement of Scottish councils' funds and for their lamentable failure to stand up for the needs of the population of Edinburgh and Scotland. They have been brought to account tonight, and the people of Edinburgh will take note.
§ Mr. Andrew Welsh (Angus, East)
The hon. Member for Edinburgh, South (Mr. Griffiths) has a great deal of expert knowledge of housing and has outlined the problems of Edinburgh and Scotland. I hope that the Minister was listening because those issues are relevant to the living standards and environment of the Scottish people. His message was well worth hearing and I hope that the Minister took note.
Housing support grant is what it says—it is the amount of money central Government are prepared to give to support public housing in Scotland on a national basis. It is clear that the Government are giving less and less to any national housing programme. It is also evident that the Government have no national housing programme in Scotland. Their retreat from providing finance is witness to their lack of commitment to Scotland's housing situation and housing problems.
Since 1979–80, the housing support grant contribution to the housing revenue account has been slashed from 39 per cent. to 7 per cent. In 1989–90, only 23 out of 56 Scottish housing authorities will qualify for any form of housing support grant. By deliberate policy, the Government are withdrawing their financial commitment to any national housing programme.
As a consequence, the burden of financing council homes has shifted on to the tenants, but, at the same time, there has been a continuous reduction in Government funding—it has fallen from £391 million to £60 million when calculated on average prices. That staggering decline in commitment worth £331 million has taken place in less than a decade.
The Government are retreating from the problem. How else can one describe a Government who have done nothing to overcome the damp and decaying conditions prevalent in the Scottish housing stock and who have consistently refused, at the same time, to undertake a Scottish housing conditions survey? They are simply failing to measure up to the problem.
During the past nine years tenants have seen their rents rise by 230 per cent., but capital expenditure on housing has lagged far behind. Therefore, the Scottish tenants are getting the worst of all possible worlds-high rents and reduced housing standards. As a result of the Government's housing policy, more than two thirds of Scotland's housing stock now receives no grant support at a time when thousands of homes are simply below any tolerable standard. Once again the housing support grant settlement shows no national commitment whatsoever to tackling the major problems of homelessness, dirt and overcrowding and the other problems that are endemic in Scotland's housing system. The Government's callous indifference to Scotland's housing crisis is in the order for all to see.
The Government's housing priorities are quite clear when the vast mortgage interest relief subsidies enjoyed. by the south-east of England are compared with the sums being made available to Scottish local authorities. The Government always accuse Scottish council tenants of being sheltered from market forces, yet the £60 million provided for Scottish public sector housing pales into insignificance beside the subsidy of almost £5 billion given to English private housing through mortgage interest tax relief—by a factor of more than 80.
821 I wish to draw the Minister's attention specifically to homeless persons—a growing problem which the Government have singularly failed to address. The increase for the hostel portion of less than 1 per cent. of the aggregate grant is totally inadequate, but the 33 authorities which do not qualify for housing support grant are placed in an even worse position by the Government after this settlement. I hope that when the Minister has listened to my arguments, and to the points put to him earlier, he will give the House a cast-iron guarantee that he will look at the current legislation and report back with new proposals to help local authorities cope with the growing problem of homelessness.
At present most housing authorities which do not receive housing support grant have to meet all the costs of running their homeless persons' services through the housing revenue account. Surely that is unreasonable. It is unfair that local authority tenants should bear the costs of the statutory service which is used equally by all sectors of the community. Logically those costs should be met from revenue support grant, as that would spread the financial load much more fairly.
Funding hostels for homeless persons is a major problem for the local authorities which own and manage them. Those hostels are notoriously expensive for residents to operate, and even more so taking into account high void levels. I hope that the Minister will address that point when he replies to the debate.
The hostel portion of housing support grant was satisfactory while virtually all authorities were eligible. But when authorities were taken out of grant no account was taken of the grant that they had lost. I understand that a number of authorities such as East Kilbride, Perth and Kinross, Edinburgh and Inverclyde have lost quite substantial financial assistance. For example I understand that the additional combined costs of the homeless persons' service in East Kilbride and the hostel deficit has meant an increase of 75p per week per tenant, given the very small district council housing stock. In Edinburgh the figure is an approximate addition of £1 per month or £12 per tenant per year as an additional burden.
The homeless in Scotland need action, but the Government simply starve them of funds. As COSLA points out, the resources and consents available next year, excluding receipts, represent a cash reduction of £96 million for housing in Scotland.
The Government are producing a cash standstill, assuming that the greatest input to assist housing programmes must inevitably come from council house sales. It is a crazy way to run any council housing policy to say that housing provision will not be determined by the housing needs of the population but by the number of houses that can be sold. That is exactly what the Government are doing. They are imposing another major problem on Scotland's housing.
The proposed paltry increase of £5 million in housing support grant is nothing short of pathetic. As a direct result of Government policy, council house rents inevitably will rise. COSLA estimates that they will increase above the rate of inflation. The tenants are paying the price for the Government's policy. However, tenants in SNP-controlled Angus will benefit from a housing policy 822 which gave them a zero rent increase last year and a small increase this year which keeps Angus tenants well below the Scottish average.
§ Mr. John Maxton (Glasgow, Cathcart)
One reason why the SNP-controlled Angus council rents will be lower is that that council is prepared to accept a subsidy from Tayside region to collect the poll tax.
§ Mr. Welsh
I am referring to a zero increase in rent last year. Angus was the only council to achieve no rent increase. That fits in with the SNP's record in every year of its administration of keeping rents down. Angus tenants have benefited from that policy. That has happened, despite the Government's policy.
§ Mr. Tony Worthington: (Clydebank and Milngavie)
Has the hon. Gentleman noted that there is no connection between what he has said and what my hon. Friend the Member for Glasgow, Cathcart (Mr. Maxton) said? Will he now make such a connection?
§ Mr. Welsh
The only connection that it is feasible to make is the contribution made by the Tayside region towards rates collection by Angus district as collection agents. Its rent record is much more important. After having one of the highest rent levels throughout Scotland under the Conservatives, Angus now enjoys under the SNP one of the lowest rent levels in Scotland. I repeat that that record has been achieved by its own management record and despite the Government's policy.
§ Mr. Jimmy Hood Clydesdale)
Angus district council is collecting the poll tax and giving a subsidy to the tenants, which is a bit of a contradiction in terms. Hamilton district council, which covers part of my constituency, has refused to collect the poll tax, with the result that tenants have been penalised by 28p per week. However, we are standing by our principles. We do not speak about them; we act on them.
§ Mr. Welsh
I do not know whether that intervention was helpful. However, the hon. Gentleman is on very weak ground, since fewer than a quarter of his colleagues have turned up, so perhaps we could point an accusing finger at them.
I reiterate that the low-rent policy in Angus has been achieved by good government which has benefited the tenants. Tenants in other districts will not be so fortunate. Rent increases have been outpacing inflation. The capital allocation is about 50 per cent. short of what is required seriously to tackle Scotland's housing problems. That is due to this Government's policies, which are inadequate to meet Scotland's housing needs. The housing support grant package is typical of the Government's attitude, and it simply will not do.
§ Dr. John Reid (Motherwell, North)
I am very grateful to you, Mr. Deputy Speaker for having called me. I was getting worried about the lateness of the hour. I am glad that I have been called to speak in the debate, because I have issued a press release. I should not have liked to annoy Conservative Members twice in one week.
I shall repeat a few items that some hon. Members have read, because there are visitors in the Strangers Gallery who are eager for details of Scotland. It will permit me to repeat a few points that have already been published. I did 823 not intend to speak in the debate, but I am doing so as a result of popular acclaim. I do not withdraw or regret one word that I did not say last Tuesday in the House. I agree with every word that I did not have the opportunity to say on that occasion, but there are two tragedies to which I wish to refer.
First, in the seven days since I should have made that speech, there has been no change in the housing situation in Scotland. Secondly, it is rare in the history of Parliament for a Minister to be given one week's notice of the detailed case that is to be made against him and to be given the opportunity at the Dispatch Box to reply to the criticisms that are made of him and still to make such a pathetic effort of defending the Government's record.
Another item should be mentioned at the beginning of my speech. [Interruption.] The hon. Member for Tayside, North (Mr. Walker) is laughing. I enjoyed listening to his interventions and jokes this evening. God knows the people of Scotland have little enough to laugh about. One thing in particular intrigued me℄that the Minister, the hon. Member for Tayside, North and their colleague the hon. and learned Member for Perth and Kinross (Sir N. Fairbairn) actually read the Evening Times and are affected by it. That only goes to create a new law in physics—that even paper can sometimes penetrate the thickest walls of the largest mansions and the thickest minds of the biggest bigots in Scotland.
I am glad to note that some controversy has been caused, but the tragedy is that, for thousands of people, the Evening Times—not the debate—will bring little information or solace. Even tonight, as we debate the issue in the relative warmth of a comfortable Chamber, beneath the vaulted ceilings of the Palace of Westminster, almost 30,000 people will share neither warmth nor a roof over their heads. It has already been mentioned that 29,185 people in Scotland will draw little solace from warmth or a roof. They will not read Hansard in the morning, and they will not have read it last Wednesday. Therefore, they will know little of our debates.
Few of those 30,000 people will hear about the debate on wireless or television. They do not have wireless or television, or access to the privacy that allows them to listen to radio or to watch television. Many of them will pick up one or two pieces from the popular press about a debate that is carried on late at night, yet those 30,000 people are the real substance of the debate. I make no apology for having tried to highlight their plight by every possible means. If that resulted in a joke, because the Government's incompetence lost us a debate that we should have had a week ago, it is not I, but Conservative Members, who should apologise.
Those 30,000 people are the real substance of the debate. They have been mentioned by hon. Members tonight. I refer not only to the young couple who were mentioned in the Evening Times article. There are many of them. Last week they were still lying on relatives' couches, trying to keep marriages together in their early months. This week they are on the very same couches and they have not been forced to move on to others.
Old couples have been mentioned. I refer to people who have lived for years and decades in family homes. Because of a drastic delay in repairs and damp conditions, they now find themselves either having to move out of their homes or, once again in their old age, become dependent on people who are much younger. I make no apology for having raised that matter. Tonight we can debate the 824 consequences of the Government's failure to provide adequate housing support in Scotland, but the people such as those whom I have mentioned must suffer the consequences of the Government's housing policy.
For many years, it has been obvious that the overall picture of contributions for council housing in Scotland has been one of cuts and neglect, so there is nothing new in the substance of tonight's debate. The proposals for 1989–90 do nothing to halt that neglect. There has been a real cash reduction of about £96 million, which will do nothing to reverse the opinion of people in my constituency and others who suffer throughout Scotland that the Government are the real enemy when it comes to imposing rent increases upon them time and again. Nothing will be done to ease the burden of council tenants with rent arrears caused by cuts in housing benefits.
When I listened to some of the smug jokes that were being put around tonight, I thought of a case that I have mentioned in the House before. I make no apology for raising it a second time. An 83-year-old man is suffering from pneumoconiosis. One does not get that disease in a billiard hall or a pub. It is the result of a lifetime of working in the depths of a pit and producing wealth for others. That man went to war in 1939. He did not ask then what his country could do for him, or what he could do for his country. He just went and did what he had to. Now, the Government have taken away his housing benefit, and his rent has increased from 72p to £47 a fortnight. Surely someone with that record is entitled to ask, in the last decades of his life, what his country is going to do for people such as him.
Since the Government took office nine years ago, rents in Scotland have increased by an average 230 per cent.—
§ Mr. Bill Walker
I thank the hon. Gentleman for giving way with his usual courtesy. When he gives us these figures, will be carefully consider the level of housing support before the Conservatives came in in 1979? What was it in real terms? What is it today? Will he consider the fact that increased rents for those who can afford to pay them have gone into the housing coffers? Those who cannot afford to pay are—properly—given housing benefit.
§ Dr. Reid
My hon. Friend the Member for Edinburgh, South (Mr. Griffiths) has already dealt with some of those points. As others of my hon. Friends have said, many local councils and district authorities get not a penny, compared with 1979. The amount of unemployment that has been created in Scotland since 1979 is another part of the equation.
The defence put up by the hon. Member for Tayside, North is an unusual one. The Government would usually plead that rent increases had nothing to do with them. They are all to do with supply and demand—with the laws of the economy, or the Book of Revelations. They are never anything to do with the Government. In this case they cannot claim that, because there is nothing natural about a 230 per cent. increase in rents. It is out of all proportion to increases in housing costs, as dictated by the supply and demand of the market that is so beloved of the Government in other circumstances.
For instance, since 1981, housing costs—on the Government's usual criteria—have risen by 44 per cent. in Scotland; during the same period, the Government have compelled rents to rise by 124 per cent.—80 per cent. More 825 —to compensate for the loss of central grant and local contributions. That increase—from £4.92 to £16.23 a week—is of staggering proportions. It cannot be related to supply and demand.
Yet this order means that average rent increases next year will once again immensely outstrip inflation, with some authorities being forced to consider increases of £3 a week or more, or £4 or more in the Glasgow area.
What will we say to constituents who are already going under with rent arrears? There has been a massive increase in rent arrears in the past year. I can only tell my constituents the shameful truth about the Government's dogmatic insistence on undermining public sector housing, and the roles that rent increases and the sales of council houses have played in that. I can tell them that housing support grant is the only direct government subsidy for Scottish housing, and that this deliberate Government policy has meant more than £290 million in cuts in grants and subsidies. I can tell them that as a result of that, council rents are now more than £7 a week higher than they would otherwise have been.
None of this compensates for the misery that has already been suffered, and which will continue to be suffered, in many parts of Scotland. Those increases might buy some hon. Members a large cigar or a couple of brandies after dinner, but over a week, they are sufficient to cripple many households in my constituency and throughout Scotland which are already crippled by debts and which will face even greater debts as a result of the poll tax.
When, in anticipation of some of the points that my hon. Friends and I would raise, the Minister told us that rents in Scotland were lower than those in the southern half of England or across the border in England, and when he accused Motherwell district council of keeping rents artificially low in comparison with those elsewhere, for instance in the south of England, why did he also not tell us the average salary in the south of England compared with the average salary in Bellshill Shotts, Newarthill or Carfin? Why did he not tell us the average rate of unemployment in the south of England compared with that in parts of my constituency? Perhaps it is because he does not know, but it could be because he does not want to ask himself the question because once he reveals the average salaries and access to jobs in those areas, he will have to concede as a matter of moral principle and economics that rents in certain areas of the country are justifiably low because of social and economic circumstances.
I take it as a testimony of the efforts made by my colleagues who serve on Motherwell district council that they should be criticised here for attempting to ensure that the social and economic effects of poverty and unemployment in Motherwell district are compensated for by some attempt to defend the rents of the people in the area. As my father used to say, "If the crowds boo you and you are away from home, you're playing a damn good game." When the Minister criticises the action of Motherwell district council, that is the best testimony that it could have that its efforts are being well directed for the people who elected it.
The word "crisis" is used liberally these days, but when one considers rent increases and sees how little money is 826 available for capital investment or improvements in existing stock or for essential repairs to homes, using the word "crisis" in relation to Scottish housing is justified. Indeed, many would say that it is a moderate word to use.
I am surprised that the Minister should be upset that I have released the Government's own dubious statistics because whether they have been used in a speech in the House of Commons or not, they are the Government's own statistics—and they show that, of the 843,000 council homes in Scotland, no fewer than 356,752 need modernisation, 88,044 need rewiring and, most worrying for pensioners or for people with young families, 234,000 suffer from damp and almost 154,000 need major structural repairs. It is no wonder that the Minister and his cohorts do not like figures like that plastered about in their popular press, even if they are the results of his own Department's investigations into the inadequacies of Scottish council housing at present. Those figures can only worsen as a result of the facts given tonight. Indeed, they have already become worse because the figures that I have just given described the position in 1986 and there have been two more tragic years of rundown in council housing since then.
Once again tonight, just as in the tax cuts for the rich, just as in the social security cuts for the poor and just as in the cuts in housing benefit, the Government are cynically hammering the poorest and the most vulnerable in our communities in Scotland. Is it not significant that while central Government support for mortgage interest tax relief continues to increase, direct Government grants in support of local authority housing costs have decreased from £228 million in 1980–81 to £60 million next year?
It is conventional in such debates to refer to one's own constituency and district council and to speak about the effect of the order under debate. Nothing could be simpler. The effect in terms of benefit to my constituency will be absolutely zero. We will receive nothing in grant. Motherwell district council's housing support grant has plummeted from £8.19 million in 1980–81, the year after the Government came to power, to £5.74 million the following year, to £3.3 million in 1982–83 and to £1.4 million in 1983–84, and there has been nothing at all since 1984.
The Minister knows, as I know, that my constituents have paid the price of the Prime Minister's antipathy and antagonism towards them. My constituency has one of the highest proportions of council house tenants in Scotland and a high proportion of unemployment and poverty. As a result of not having voted for the Prime Minister, not coming from her small middle-class shop keeping background or not being successful capitalists, my constituents have been penalised at the rate of £1 million per year. That is £9 million over nine years. If there were anything left, the Prime Minister would take it away. She has taken it all away and my constituents receive nothing in grant.
In the debate the Minister revealed the Government's antagonism towards council housing. I am glad that he made the admission and my hon. Friends will remember it. The Government blame local authorities for pushing up rents. The Minister confessed, probably inadvertently, that rents have been forced up, not because of floating or supply and demand, but because they were too low when the Government came to power. That gives the lie to any 827 accusation that rent rises have been caused by anything other than a Government who came to power bent on increasing rents.
Motherwell has not been alone in the scale of its central Government deprivation. As we have heard in the debate, 56 authorities qualified for grant in 1980–81 and that figure has steadily fallen to 23. That has been brought about by a hostile Government on the basis of spurious assumptions. The factors used to determine an authority's eligibility for housing support grant ignores the actual position of housing authorities. The steady reduction by the Government has been brought about by ignoring the actual position of housing and substituting expenditure and income figures that they deem should be applied.
"Deem" is a peculiar word and is constantly used in courts. It means that although it is not known whether something happens and no one has any idea whether it could happen, it will be made up. "Make it up" is translated into legal language and becomes "deem. The Government ignore what is happening on the ground, the actuality of housing problems, and deem the housing needs of an area. In other words, they make something up to suit their own restrictive dogma. Put simply, the Government understate the need for expenditure and overstate the level of income likely to be achieved by a local authority. The difference between the two represents the Government's financial obligation which is steadily and significantly reduced.
Instead of deeming, making up and cutting by stealth, why do the Government not acknowledge the massive need for investment to halt the crisis in Scottish housing? Over £1,000 million per annum is needed to tackle the problem but only £569 million has been planned for next year. When consent to apply higher levels of investment in housing has occurred, it has largely arisen from council house sales, which further reduce the public sector stock, and are at the expense of grants and subsidies and lead to higher rents. The Government have contrived to manufacture the worst of all worlds for council house tenants. Had that arisen by accident or by incompetence it would have been a sufficient stain on the Government's record. When it arises as the predictable outcome of deliberate, contrived policy it is a matter of shame for the Government and for the House.
I wish that last Tuesday I had had the opportunity to go into the Lobby to vote against the Government on this issue. I wish that I had that opportunity every night, because every night the Government need reminding of the misery that they are inflicting on thousands of council house tenants in Scotland. That is why, even if the opportunity comes late, I shall be proud to walk into the Lobby to vote against the Government.
§ Mr. John McAllion (Dundee, East)
The Government Benches have been sparsely populated for most of this debate. When they have actually shown their faces, English Tory Members have shuffled impatiently as though they were anxious for the business to be concluded so that they could get away home to their beds. The Strangers Gallery is almost empty, the Press Gallery is empty, and the clock tells us that we are well on the wrong side of midnight. All these things tell us that the mother of Parliaments, the seat of democracy, is dealing with Scottish business in the way that it usually does. It is little 828 wonder that there is such unhappiness in Scotland with the constitution of the United Kingdom and the way in which the Westminster Parliament deals with Scottish business, or that there is such a demand for Scottish business to be returned to Scotland and put under Scottish control. I do not ask that the House changes the way that it handles Scottish business by having it earlier in the day. I ask that the Government grant the Scottish people what they have always wanted: their own assembly, to look after their own affairs away from this place, so that housing and other matters that are specific to Scotland can be dealt with in Scotland by Scots.
§ Mr. Nigel Griffiths
I know that my hon. Friend will wish to ensure that the record is accurate, and show that the press have not gone home entirely, but were so buried with their heads down in their notebooks taking every word of his sensible comments that he did not see them from his position.
I am grateful to my hon. Friend for drawing my attention to the press man who is sitting alone in the Gallery and is acting as a stringer for everyone else.
§ Madam Deputy Speaker (Miss Betty Boothroyd)
Order. I am not sure whether hon. Members are aware that it is not in order to refer to the occupants of the Press Gallery.
§ Mr. McAllion
I will accept your ruling, Madam Deputy Speaker.
I was grateful to my hon. Friend the Member for Glasgow, Garscadden, (Mr. Dewar), who drew our attention to a dramatic speech made by the Secretary of State for Scotland. That speech was made not during this debate—it has been his wont to take part in only few debates on Scottish business—but in a previous Parliament, and in it he complained about the corrupt system of council housing finance in Scotland, which he believed was corrupt because it benefited Labour voters. That comment shows the true genesis of the poll tax. Far from trying to root out corruption, and get rid of a corrupt system of financing local government, the Secretary of State has introduced another corrupt system of local government that will benefit Tory voters—the poll tax.
The Minister described housing support grant as a deficit subsidy. However, if there is no deficit in the way in which the council meets its housing costs, there can be no housing support for the council. How does one establish whether a deficit exists? The Minister said that one makes reasonable assumptions about the income and expenditure of local councils' housing revenue accounts.
Such a system depends on those who are making the assumption, and whether that assumption is reasonable. The Minister seems to be saying that a Tory Minister who knows little about housing in Dundee can make an assumption about the income of the Dundee district council and its expenditure on its 38,000 council houses and can arrive at the conclusion that there is no deficit on the council's housing revenue account, so it should get no subsidy from central Government funds. I can tell the Minister that Dundee district council's housing revenue account for next year will have to receive an additional £6 million over what it received last year, and the Minister is saying that that money will have to be found directly from increases in rent for council house tenants in Dundee and from no other source.
829 People who, like me, are owner-occupiers can look forward to central Government subsidies to meet their housing costs in the coming year, but those in the 38,000 council households will get no such subsidy because the Minister says that the revenue must come from rent increases. The people of Dundee are facing rent increases not of £1.34 per week but £3.95 and many tenants will face increases as high as £5.50 a week. The Minister says that that is because the rents have traditionally been too low.
An old couple came to see me last week in my surgery. They have suffered badly under the housing benefit changes introduced by the Government. They are receiving some transitional protection but they have not received any payment for some weeks. They were concerned about the rent increase about to be imposed upon them because they were down to the last £200 of their savings. A few months ago they had £340 but they had to eat into that to pay the rent increase as it stands now. The Minister is telling those people that they will just have to live with it and eat into their savings. After that, I do not know what will happen to them. Perhaps the Minister will explain how that old couple can stop worrying about the rent increases that he is imposing on the people of Dundee and no one else.
If anything is more arcane or difficult to follow than the procedures of the House, it is local government finance. So many phrases have been thrown into the debate—the general fund contribution, the housing revenue account, the housing revenue account block A capital allocation, the housing revenue account block B capital allocation and so on—that it is not difficult to understand why people in Scotland sometimes find it hard to follow the debates about housing and rent that take place here.
My hon. Friend the Member for Motherwell, North (Dr. Reid) said that none of the 30,000 homeless in Scotland would follow the debate closely or be able to question anyone on it. I doubt whether many council tenants in Scotland will follow the debate closely, not only because it involves obscure and detailed language with which they are not familiar, but because the Government deliberately stage it at this early hour in the morning when no members of the press are present. so that it will not appear in the press tomorrow and will not be on the radio or television. No one will know why their rent has increased.
When the people in Dundee try to find out why their rent has increased by £3.35 or £5.50 a week, we all know what they will be told by D C Thomson press in Dundee. It will say that the Labour council increased the rents as will Tory Ministers and the SNP opposition on Dundee district council. Nothing could be further from the truth. The Government and the Minister now sitting on the Front Bench are increasing rents. No matter how obscure the Minister makes that or how much he wraps it in detailed language, that is the truth and we will ensure that the people of Dundee realise that.
That becomes obvious if one looks closely at the housing revenue account for Dundee district council. Compared to last year the council will have to find an additional £6.3 million next year. There are many reasons why it has to find that additional expenditure and most of them are caused by the Government. First, there is inflation. The Chancellor set himself the target of zero 830 inflation but the Morning Star on Saturday said in banner headlines that inflation was 6 per cent. plus and rising. The Morning Star has always taken a keen interest in inflation and counter-inflationary policies. It was rightly drawing attention to the way in which the Government's economic policies are failing and the way in which inflation is imposing increases upon councils—[Interruption.] If the hon. Member for Stockton, South (Mr. Devlin) wishes to intervene, I will gladly give way. I would rather he intervened than continued to shout and mutter from a sedentary position.
§ Mr. Tim Devlin (Stockton, South)
Perhaps the hon. Gentleman can remind the House when the Labour party managed to get inflation down to 6 per cent. when it was in government. I cannot remember a time.
§ Mr. McAllion
When the Labour Government left office in 1979, inflation was 8 per cent. and falling. Within a year, the Tory Government had put inflation up to 20 per cent. because they gave way to inflationary pressures.
Because of inflation under the Government, Dundee district council will have to find an additional £247,000 to be allocated under the repairs and maintenance heading of its budget. That is just to keep the work at the same level as last year.
One can argue about how much the Government can be blamed for inflation increases, but one cannot argue about, the other Government decisions that have led directly to rent increases in Dundee. For example, they have changed the rules governing the definition of capital expenditure. Repairs and maintenance carried out to re-lets in Dundee used to be paid for out of capital expenditure and came under that heading. Since the Government changed the rules that define capital expenditure, that can no longer be done. By Government diktat, an additional £1.5 million has to be raised from the housing revenue account and so from rents. That is because the Government will not allow the district council to proceed within the definition of capital expenditure.
In 1980–81, Dundee district council received £9.1 million in housing support grant, which enabled it to meet its housing costs. If that level of support had been maintained, a further £72 million could have been spent on the city's 38,000 council houses. If the Government had honoured their commitment to council house tenants in Dundee by continuing to fund that level of grant, rents could be £4.50 a week lower that they are now. Instead of having to face an average increase of £3.95 a week, council tenants in Dundee could be given an average rebate of 55p a week. That would have been the result if the Government had paid up what they owed in housing support grant.
In 1985–86, Dundee district council received £4.917 million in rate fund contribution—the general fund contribution as it is now known—to help it meet its housing costs. Since then, direct Government action has caused the contribution to be cut in three huge swathes so that it is now absolutely nothing in the order that is before us. That is another massive blow to the housing revenue account and another reason why rents will have to increase in Dundee. That is the consequence of Government action. The council is not responsible for that.
Changes have been made to the housing benefit regulations and the district council estimates that these have cost it £190,000 in lost rent. That sum will have to be found from the housing revenue account next year, and 831 that will mean increasing rents. It was calculated that on 31 March 1988, rent arrears in Dundee stood at £884,000. The following day saw the introduction of housing benefit and social security changes. By 30 September, arrears had increased to £1,226,000. The people of Dundee, whom the hon. Member for Tayside, North (Mr. Walker) claims have been protected by housing benefit, could not afford to meet the increased rent levels. They were taken out of housing benefit and they had lost social security payments. They could not afford to pay their rents and the council could not get the money from them.
§ Sir Nicholas Fairbairn
Some of my constituents have the good fortune to pay their taxes to the Perth and Kinross district council and some are infinitely less fortunate and have to pay their taxes to Dundee district council. As the same system of support applies to both councils, why is it that those who have the misfortune to be taxed by a rabid Labour-controlled council such as Dundee have to pay twice as much as the fortunate citizens who are taxed by Perth and Kinross?
§ Mr. McAllion
That may have something to do with the fact that Dundee district council has 38,000 council houses while Perth and Kinross has only a small fraction of that number. The costs that have to be met by Perth and Kinross district council are infinitesimal compared with those that are faced by Dundee district council. If the hon. and learned Gentleman had thought about that he would not have got on his hind legs to ask the question. I am glad that one English Tory—the hon. Member for Stockton, South—has remained in the Chamber to listen to some realism instead of opting to be plonked down in the south to learn nothing about what is happening in Scotland.
§ Mr. McAllion
I am coming to that. There is the so-called benefit that is derived from selling council houses to sitting tenants. Dundee district council sold 1,600 council houses to sitting tenants last year, which meant a loss of rent income of £1.802 million. That sum will have to be raised from the housing revenue account, which in turn will mean increasing rents throughout the city. It would be all right if new council houses were still being built, but there are tenants who are trapped in multies, tenements or other housing which for various reasons is entirely unsuitable for them. There is a massive shortage of suitable housing in Dundee and so many are trapped in unsuitable housing and pay high rents. That is because the Government are selling the only houses which these tenants can aspire to live in by taking a place on the housing waiting list.
§ Mr. Bill Walker
The logical conclusion of the hon. Gentleman's argument seems to be that councils that sell off more of their housing are worse off. Why, then, is Dundee, which has one of the worst records of selling homes, worse off than Perth and Kinross, which has one of the best?
§ Mr. McAllion
The hon. Member is not comparing like with like. Dundee district council is in an entirely different league from Perth and Kinross. I do not represent Perth and Kinross. If the hon. Member for Tayside, North would like to tell us how many houses that council owns, we might be able to make a comparison.
§ Dr. Reid
In view of the resounding silence on the Conservative Benches, are we to assume that the three supposedly pertinent points that have just been made about housing finance in areas represented by Conservative Members have been based on ignorance even of the number of council houses in their areas?
§ Mr. McAllion
My hon. Friend is right. I have given the hon. Member for Tayside, North every opportunity to tell the House how many houses Perth and Kinross district council owns, but he will not do that because he does not know the answer. Nor does the hon. and learned Member for Perth and Kinross (Sir N. Fairbairn). They must sit in embarrassed silence because neither knows the answer, although they claim to represent that local authority in the House.
The Government's squeeze on capital expenditure in years past has contributed to rent increases. District councils, faced with a loss of houses because they have been forced to sell them and because they cannot get the capital allocation that they need to build new houses, have had to take out covenant schemes to build the houses they need. Such schemes are fine at the time, but a day of reckoning comes when repayments have to be made, and repayments are being made in a climate of climbing interest rates because of the Government's policies. That means another massive cost to the housing revenue account, and it is another reason for higher rents.
Labour district councillors in Dundee are doing a magnificent job on behalf of tenants in the city, whom they are trying to defend in a rapidly deteriorating situation. We have heard some statistics about homelessness tonight. Conservative Members had better know that, in Dundee, during the past five years, homelessness has trebled—and that figure does not take into account factors such as recent increases in mortgage interest rates, which will lead to a great deal more people being made homeless in the city. Housing benefit and social security changes will add to the problem.
The Government make out a good case for tackling the housing crisis in Scotland. They speak about co-operation between the Government and local councils and an attempt to deal with the many problems, especially in peripheral estates such as Whitfield.
§ Mr. Devlin
On the contrary—the hon. Gentleman started his speech by saying that English Members are not interested, and now he is trying to stop an English Member intervening. All I want to know is how many private sector houses there are in Dundee.
§ Mr. McAllion
I have no idea how many private sector houses there are. At one time, Dundee had 40,000 houses, which constituted about 60 per cent. of the housing stock. It now owns about 38,000.
In a statement about the Whitfield estate, the Government agreed that the way to tackle the housing crisis in peripheral estates is to increase expenditure on them and housing services. When the Government are asked for the money, however, nothing happens. They 833 have slashed housing support grant, taken away the general fund contribution and slashed the capital allocation to the council.
Next year, Dundee's housing revenue account block A allocation is to be cut by more than 50 per cent., from £9.95 million last year to just £4.43 million this year. How is the council supposed to tackle the city's massive housing problems when the Government will not even let it borrow money to spend on housing? It is selling the housing stock as fast as possible.
My hon. Friend the Member for Garscadden mentioned the Minister's refusal to have a house condition survey, such as is done in England and Wales, for Scotland. However, there are housing check lists. Dundee district council carried out one of those checks last year to update its five-year rolling plan for housing in the city. It found that 13,800 houses needed modernisation and 11,300 houses suffered from condensation and damp. It has calculated that it will need £25 million a year in capital allocations to deal with those problems. However, the Government have suggested that Dundee should receive only £4.03 million in capital allocation.
We could understand that level of allocation if there was a shortage of money. However, we cannot pick up a paper today without reading that the Chancellor of the Exchequer has £15,000 million of Budget surplus that he does not know what to do with. We only want a tiny wee fraction of that £15,000 million to start to tackle the housing problems in Scotland. No one understands why the Minister will not agree to that.
§ Mr. Bill Walker
The hon. Gentleman's head seems to be full of interesting statistics. If Dundee district council had £25 million to spend tomorrow, how would it find the work force to carry out the work? He knows as well as I that there is a dearth of tradesmen in Dundee to carry out that type of work.
§ Mr. McAllion
The hon. Gentleman has made an absurd allegation. He knows that the Government used to produce statistics which gave the numbers of unemployed people in different categories and from which we could tell how many building workers were unemployed. However, the Government were so embarrassed by the number of building workers on the dole in Scotland that they will not produce them. They refuse to give any figures about the number of people on the dole in Dundee. If £25 million was allocated to Dundee this year, it would spend it, but not in the way in which the Government would spend it. It would not spend it on one housing estate in the city which would be a kind of model to be publicised on the television and for which benefit could be claimed.
The Whitfield estate in Dundee shows what can be done, but every other estate in Dundee shows what is not being done for housing in Scotland. Councillor John Henderson has assured me that Dundee would spend the £25 million if it had it. I would be very glad to hear the Minister tell us at the Despatch Box that Dundee was going to receive that money. That would suit me entirely.
I came across an article in The Scotsman today about Mr. John Jenkison the director of housing for a new private management company set up under the Scottish housing legislation. He is director of Waverley Housing 834 which is targeting council houses in the Borders and taking over houses from district councils. Mr. Jenkison is quoted as saying:Ultimately the district councils will not be in a position to offer choice because they will not have any stock. The Government is on course to remove that function from district councils.That comment comes not from a Labour Member, but from someone who supports the Government's policies and agrees with the Housing (Scotland) Act 1988 and who knows what the Government are about. They are about taking the right from district councils to provide reasonable houses at reasonable rents to people on low incomes. The Government do not have any mandate for that in Scotland.
I began my speech by saying that a Scottish Assembly was the only forum in which housing could be properly dealt with for Scotland. I end on the same basis. We shall never get justice from the Tory Benches. The people of Scotland know that. We will never give up until we get a Scottish Assembly with Scottish control over Scottish housing.
§ 1.7 am
§ Mr. Thomas Graham (Renfrew, West and Inverclyde)
Earlier tonight my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) said that the Minister was one of the nice men in the Tory party. Some of my colleagues say that he is a gentleman. However, the people in Scotland in council houses do not need a gentleman; they need someone who is prepared to stand up and fight. That is sadly lacking.
Since 1979 there has been a systematic attack on council house tenants. Since then rents have increased massively by more than 230 per cent. The hon. Member for Tayside, North (Mr. Walker) is smiling. He should come and smile at my constituents—the elderly and disabled—who are forced to pay those massive rent increases. Since 1979 the rents have escalated.
A report by COSLA shows that in 1986 the Government's limited statistics identified that, out of 843,000 council houses in Scotland, 356,725 need to be modernised and 88,000 needed to be re-wired. That is an unbelievable indictment. COSLA says that 234,000 houses suffered dampness or condensation, while 153,746 needed major or structural repairs. We need a Minister who is prepared to ensure that the housing crisis in Scotland is solved.
I was appalled to hear the Minister boast proudly that he was not apologising for the fact that rents in Scotland were going up again. He was quite happy to see a £1.48 increase—after the trauma of the housing benefit cuts, the fear of what the poll tax would bring and the record levels of unemployment that still exist in Scotland. People are suffering more and more because of the Government's inability to improve—or rather their deliberate policy not to improve—the quality of life for people who are homeless; people who are living on state benefits, but are desperate because they are unemployed.
The Minister is not prepared to stand up and fight. There should not be a £1.48 rent increase; there should be a decrease, and a massive housebuilding programme to give folk decent housing. We do not want the nonsense that we are hearing tonight.
I accept that the Minister is a gentleman, but I am no gentleman. I am sorry to see that the hon. Member for 835 Glasgow, Govan (Mr. Sillars) is not here tonight for this important debate, but I was born and bred in Govan. I know what it was like to live under a private landlord. My mother and late father know what it was like for five of us to live in a single end. We were over the moon the day the note came through the door from the Glasgow corporation offering us a decent house—a house with a bath.
I had never seen a bath. I thought that it was something that you put a goldfish into. [Laughter.] Hon. Members may laugh, but it was like that in those days. The only water that 1 had seen in a big bath was in the swimming pool. I do not have the background of a gentleman who has lived in a big fancy house. I still do not live in a big fancy house: I live in a Scottish special house, and I rent it.
I see the poverty around me, created by the Government's cuts in social security and housing benefits. I see the fear that the Government are creating in Scotland. I plead with the Minister to stand up and fight for these people to ensure that they need not pay such a punishing rent. He has the power to do something to ensure that the people of Scotland have a decent chance.
As I have said, my life started in Govan, and I went to a house in Pollock. When I married I could not get a house. I had to go to a private landlord. Eventually I had a bit of luck: I got what is called an "economic expansion house" because of my job. Unemployment is so massive that it is hard for anyone to get a house, let alone an economic expansion house, yet Government policy is to continue to push rents so high that ordinary men and women are forced to buy their homes.
I said to the Chancellor the other day that mortgage default was one of the main reasons why many people were ending up homeless. They could not afford to pay their mortgages, and were having to go on to the streets. Massive pressure was being put on the local district council, because these folk were genuinely homeless. They are systematically selling off these people's only chance of a house and a decent living.
As I have already mentioned, we have a gentleman as a Minister, and the people of Scotland are looking for leadership to ensure that they have the right to a decent house—a right to a home that they can afford. They want decent housing which is not suffering from all kinds of defaults. They are looking for leadership that gives them the right to rent—a right which this Government have denied to them.
I see that the other Under-Secretary the hon. Member for Stirling (Mr. Forsyth) is sat there smugly smiling. I assure him that there are more than 3,500 homeless people in Renfrew district and Inverclyde who are not smiling tonight. They are weeping in overcrowded conditions. There are family bust-ups, domestic problems, divorces, separations and everything else going on, because of the level of homelessness. There are more than 30,000 people in Scotland whom the Government know are homeless. However, that is the tip of the iceberg—there are more than 30,000.
Many people have given up the ghost. We read in the Scottish papers the other day of an old man, who is living in a tent in a park. He is desperate for a home and he has asked the local authority to provide him with one. I am sure that the local authority will find him a home, but it is time that the Government gave the 30,000 homeless a home and some young people the right to a decent future. 836 They do not want a castle or thousands of acres where they can shoot partridges and grouse, they want a home where they can cook and from which they can go to work. It is time that the Minister gave them that leadership.
§ Mr. John McFall (Dumbarton)
Local authority tenants' rents have risen by 230 per cent. in the past nine years. As a result of these orders, we see that the average rents next year will once again exceed inflation. The capital investment required to maintain and improve the housing stock is still some 50 per cent. short of what the authorities require to tackle Scotland's housing crisis. That has been debated well tonight. The acid test was that, if the Government were interested in Scottish housing they would have provided a housing condition survey. They have not done so. They have, however, given us some limited housing statistics. In 1986, their statistics identified that out of Scotland's 843,000 council houses, 360,000 needed to be modernised, 88,000 needed to be re-wired and 235,000 suffered dampness arid condensation.
How are the Government tackling that crisis? As an example, I shall take my constituency of Dumbarton. This year Dumbarton has no subsidy for public sector housing. The last time it received a subsidy was in 1981–82, when the housing support grant was £910,000 and the rate fund contribution was £2.1 million. There was a subsidy of more than £3 million in that year, with £5 million income from rents. Since then, we have received nothing at all.
The capital allocation last year was £7 million, with the authority being allowed to go to the private market to find £1 million. It was assumed that £6.4 million would come from council house sales, but the authority will fall short of that—which it has told the Government—for many reasons, not least because not as many people are buying houses as was estimated. That is one consequence of the Chancellor's high interest rates. The Government, however, have set their figures in stone and are paying no attention to the problem. It would seem appropriate to be flexible and for them to look at last year's allocation, so that they could help councils such as Dumbarton to help the public sector tenants.
I would draw attention to an anomaly in Dumbarton. The public sector does not receive any subsidy towards the cost of removing lead piping. Lead piping is a problem in a considerable number of Dumbarton's council houses. I believe that the housing authority has drawn this to the Minister's attention. I ask the Minister to meet the local authority and discuss the pressing problem of lead piping in Dumbarton, so that we can get that dealt with. Strathclyde regional council has found a temporary solution, but the long term problem must be attended to. I hope that the Minister will undertake to meet and consult me about this matter.
The housing crisis in Scotland cannot be solved until the Government realise that a substantial, real boost in housing resources is required in the next five to 10 years. Over the years, problems have been caused by the progressive withdrawal of rate support grant and other moneys to local government. The Government are out of step with the widespread Scottish view, whether that is expressed by COSLA, the Building Employers Confederation, Shelter or Church organisations who 837 believe that decent, modern living conditions are an essential ingredient to maintain the social fabric of the community.
Last year the Prime Minister was up in Scotland talking to the Church of Scotland. At the end of her speech, the convener gave her a document on housing. In conjunction with the Secretary of State and Ministers, I want her to treat that document with the same urgency with which they treated the "Scottish Enterprise" document and Mr. Bill Hughes. I hope that the Prime Minister and her Ministers will consider that document over a weekend as they did the document presented by Mr. Hughes so that the problems of Scottish housing are put in their proper perspective.
§ Mr. John Maxton (Glasgow, Cathcart)
That was the fastest intervention that I have ever heard.
It is traditional to say that this has been an interesting debate, but this has not been a debate.
§ Mr. Maxton
Yes, my hon. Friend is correct.
We have had the usual fumbling, inept performance from the hon. Member for Edinburgh, West (Lord James Douglas-Hamilton) and one Back-Bench contribution from the hon. Member for Tayside, North (Mr. Walker). His only contribution to such debates is to say that, because housing benefit has gone up since 1979 and cuts have occurred in the rest of housing support, somehow the Government have been awfully generous to the poor.
I will tell the hon. Gentleman the facts. Every time rents go up, it is inevitable that housing benefit goes up. As soon as the number of the unemployed goes up, housing benefit increases. In 1979, however, the housing benefit system was much more generous. It included 100 per cent. rent rebate and 100 per cent. rate rebate. Now, every council house tenant must pay at least 20 per cent. of his rates and he will have to pay 20 per cent. of the poll tax.
§ Mr. Maxton
I do not have time to give way. The hon. Gentleman made a lengthy speech, when his sole contribution was to suggest that there has been a massive increase in housing benefit, which is due to the Government's economic policies and rent rises. At the same time, however, council house tenants have had to face poorer housing conditions and cuts in benefit, but the hon. Gentleman does not recognise that.
§ Mr. Maxton
I will not give way. The hon. Gentleman intervened on a number of occasions and I have a short time in which to reply to the debate.
My hon. Friends the Members for Glasgow, Garscadden (Mr. Dewar), for Glasgow, Springburn (Mr. Martin), for Edinburgh, South (Mr. Griffiths), for Motherwell, North (Dr. Reid), for Dundee, East (Mr. McAllion), for Renfrew, West and Inverclyde (Mr. Graham) and for Dumbarton (Mr. McFall) have given a 838 catalogue of the cuts that local council house tenants in Scotland have had to face. They have described the appalling dampness in the housing stock in their constituencies and the ill health that that causes.
The debate has been so one-sided it is not true, but we are used to that in Scotland. The Scottish people have no one on the Conservative Front Bench or Back Benches to whom they can put their case.
§ Mr. Maxton
I shall not give way. The hon. Gentleman came into the Chamber when we were about halfway through the debate, and I do not intend to give way to someone of that nature.
My hon. Friend the Member for Renfrew, West and Inverclyde described the Minister as a "gentleman" and other hon. Friends have said that he is a nice man. My hon. Friend may not be aware that when the Minister was at Oxford university he obtained a boxing blue.
§ Mr. Maxton
Oh. I remember one of my hon. Friends saying that the Minister was unlike Cassius Clay—he floats like a bee and stings like a butterfly. That is certainly true when it comes to fighting for housing for the Scottish people.
However nice a man the Minister may be, or however nice my hon. Friends may think he is—he may be a good husband, he may be nice to his children, he may even have pets and look after them well—if he is prepared to take office under this Government, he is a Thatcherite and a cutter and he is as responsible for the poverty as his hon. Friend the Under-Secretary of State for Scotland, the hon. Member for Stirling (Mr. Forsyth) who is sitting next to him.
The Minister is not a nice man. If he were a nice man he would follow the right hon. Member for Kincardine and Deeside (Mr. Buchanan-Smith) and refuse to take office under this Government. The only good thing that can be said about the Minister is that the only alternative would have been for the Government to appoint the hon. Member for Tayside, North as the Minister responsible for housing in Scotland. If it were not for the Minister, the hon. Member for Tayside, North would be a Minister, although he always said that he would turn down such an offer.
My hon. Friends have described the misery in considerable detail and have set out the facts and figures on housing in Scotland. But what are the Government doing about housing in Scotland? Why are they doing it? At one time I was generous. I used to think that it was down to blind ideological bigotry or to political expediency. Either they hated the fact that there were council house tenants, or they thought that if they kept raising the rents and cutting the services provided for council house tenants, eventually the council house tenants would turn on the Labour party, blame Labour local authorities and vote Conservative. That has been proved wrong and we know that it will not happen. Time after time, despite the pressures put on them, council house tenants have voted Labour and refused to vote for the Government. As a result, few Scottish Conservative Members have survived.
So why do the Government implement such a policy? I was generous in attributing it to blind ideology or political 839 expediency. It comes down to the Government's driving motive at all times—greed and lining the pockets of their friends. They force up rents, cut services and create a housing crisis, and then say, "There is a crisis and we had better do something about it." That is what they are doing. Now they will say to council house tenants whose rents have gone up by 230 per cent., "You do not have to stay with the local authority. You can go to another landlord. You can go to a private landlord."
As my hon. Friend the Member for Dundee, East said, there is an article in The Scotsman today about the Waverley housing trust, chaired by the Conservative constituency party candidate who was deselected over the weekend, Mr. Michael Ancram. It is a charitable trust at present. It has taken over the SSHA houses and is now offering to take over the council house tenants. At first it is only managing them, but ownership will follow. Once the management of Waverley Housing have got their hands on it, they will rook the tenants. The tenants will be put into that position. Who will profit and who will benefit? The Government's friends and financiers, Back-Bench Conservative Members and people such as the Earl of Ancram, who used to be a Housing Minister, will benefit. It is all about greed.
Whenever the Prime Minister and her lackeys in the Cabinet talk hypocritically about moral standards and freedom of choice, it is clear that they are concerned about one freedom—the freedom of Conservative Members and their friends in the City to make profits. That is the only thing that the Government are about. That is why I refuse to call the Minister a nice man. He is a member of the Government. If he had any understanding of housing, any sympathy for council house tenants or any desire to do something about housing in Scotland he would fight from the Back Benches for his tenants and the tenants we represent and for whom we fight.
Where is the hon. Member for Glasgow, Govan (Mr. Sillars)? Does he represent council house tenants? What a farce. The hon. Member for Angus, East (Mr. Welsh) said that we should not moan, because we are not here in large numbers, either. The difference between the hon. Gentleman and Labour Members of Parliament is that we have not boasted about how we would take Parliament by storm. It was the hon. Member for Govan who made that boast. He said that he intended to disrupt Parliament. As usual, when people are in misery and distress, the Secretary of State can only snigger. That is the only thing he can do when he is in trouble. Time and time again the hon. Member for Govan has not been here for Scottish debates; he has been somewhere else, writing his articles for a despicable newspaper called The Sun.
I hope that the Minister will resign tomorrow and fight for council house tenants in Scotland.
§ Lord James Douglas-Hamilton
The hon. Member for Glasgow, Cathcart (Mr. Maxton) is doing his best to make up for the fact that he paid me a strong tribute during a housing debate in the last Parliament, which I used in my general election material. It certainly did me no harm.
The hon. Member for East Lothian (Mr. Home Robertson) asked about variation orders. If interest rates fluctuate by only 0.2 per cent., the practice is to introduce them.
840 One of the most important points in the debate was raised by the hon. Members for Glasgow, Garscadden (Mr. Dewar), for Argyll and Bute (Mrs. Michie) and for Angus (Mr. Welsh). They were concerned about the hostel costs of the homeless falling on the housing revenue account. They asked why tenants should have to pay through their rents for the cost of housing the homeless. I recognise that that is a problem. I have asked the Department to write to the Convention of Scottish Local Authorities and seek its considered views on the extent to which the cost of these and similar services should be excluded from housing revenue accounts.
The possibility of any change being made to the present arrangements will require careful consideration, not only in the light of the financial implications for housing revenue accounts and for authorities' general funds but also in the light of the consequences for the delivery of the services. In those circumstances, it is only right to seek COSLA's views before making any decision.
§ Lord James Douglas-Hamilton
The hon. Member for Glasgow, Garscadden (Mr. Dewar) suggested that, because some authorities in 1989–90 will not be allowed to retain or spend all the income that they receive from council house sales, the receipts will be reallocated to other authorities. That is not wholly correct, for this reason. For 13 authorities, the provisional gross housing revenue account allocation is lower than estimated receipts. Those authorities will receive more income from sales than their capital investment allocation, but in such circumstances the excess income will not be taken away from the authorities concerned; it will be used by those authorities to repay debts. That will benefit their tenants.
Because those resources will not be used for capital investment by the 13 authorities, we shall be able to allow additional investment by other authorities. Allocations will be made according to relative need across Scotland as a whole.
The provisional capital allocations for next year total £432 million. The hon. Member for Glasgow, Springburn (Mr. Martin) said that adequate resources should be made available. That figure is 11.6 per cent. more than the: equivalent allocation for last year. I appreciate that that level of investment may not be as much as some authorities would like, but I believe that they will be able to make significant progress in tackling their investment needs. When we announce the allocations at the end of March, I hope that the figures that were announced in December will be increased.
§ Mr. McAllion
The Minister has just said that there is to be an 11 per cent. increase in capital allocations. He knows full well that in the case of Dundee district there has been a 50 per cent. reduction. Can he explain that discrepancy?
§ Lord James Douglas-Hamilton
I intend to deal with the hon. Gentleman's constituency in a moment.
The hon. Member for Springburn said that local authorities have been obliged to cut the number of repairs. 841 Obviously, it is for each authority to decide how much it should spend on management and maintenance, balancing it against the rent levels that it is prepared to set.
On the points raised by the hon. Member for Dundee, East (Mr. McAllion), the actual sums allocated to Dundee are much higher than he suggested. I will find the exact figures in a moment and give them to him. In any case, I will make certain that he receives them.
In his spirited address, the hon. Member for Motherwell, North (Dr. Reid) suggested that there is nothing in the orders for Motherwell. Our policy is to see resources for housing concentrated on capital expenditure. The provisional HRA capital allocation for Motherwell, which was issued in December, is 16.9 per cent. higher than the figure for 1988–89, which was issued at the same time a year earlier. It is up from £13 million to £15.2 million. We will certainly not forget the interests of Motherwell.
I was asked about Glasgow. The hon. Member for Edinburgh, South (Mr. Griffiths) asked why Edinburgh was getting no subsidy and Glasgow was getting £28 million. Glasgow received subsidy because it has an outstanding capital debt of £5,577 per house. Edinburgh has an average outstanding capital debt of £4,185. Therefore, Edinburgh has about £2.50 per house per week lower loan charges. The situation is not comparable, because Glasgow is the largest public sector landlord in western Europe.
§ Lord James Douglas-Hamilton
No, I am sorry, but I shall not give way. I have only two more minutes.
The hon. Gentleman mentioned the backlog of repair grants. The extra £22.5 million that we have allocated to Edinburgh for 1989–90 on the non-HRA block will allow more than half the remaining backlog a considerable amount of it in his constituency, to be dealt with in the coming year.
I am glad to have been able to find the information for the hon. Member for Dundee, East that I could not find earlier. The Department calculates that Dundee needs to have an average rent rise of £1.03 per house per week. That excludes the effect of covenant agreements that Dundee district council took on, knowing that the cost would not be eligible for subsidy and would have to be borne by tenants. The hon. Gentleman actually used the phrase "a day of reckoning". Moreover, Dundee's provisional capital allocation of £17.4 million is 14.5 per cent. higher than the corresponding figure for last year.
§ Lord James Douglas-Hamilton
I shall not give way. I have only one more minute.
The hon. Gentleman must compare like with like. The figure is up on the allocations for last year, and the final allocations will be made in March.
I stress that a further 8 per cent. has been allocated to local authorities' capital allocations in 1989, making a total of £445 million available for capital expenditure on local authority housing this year. In other words, allocations are up by 95 per cent. over four years. More local authorities' dwellings were improved in 1987. Over 73,000—
§ It being three hours after the commencement of proceedings on the motion, MADAM DEPUTY SPEAKER put the Question, pursuant to Order [20th January].
§ The House divided: Ayes 148, Noes 67.843
|Division No. 45]||[1.38 am|
|Alexander, Richard||Hargreaves, A. (B'ham H'll Gr')|
|Alison, Rt Hon Michael||Hargreaves, Ken (Hyndburn)|
|Amess, David||Harris, David|
|Amos, Alan||Hayes, Jerry|
|Arbuthnot, James||Hayward, Robert|
|Arnold, Jacques (Gravesham)||Heathcoat-Amory, David|
|Arnold, Tom (Hazel Grove)||Hind, Kenneth|
|Ashby, David||Holt, Richard|
|Aspinwall, Jack||Howarth, Alan (Strat'd-on-A)|
|Atkins, Robert||Howarth, G. (Cannock & B'wd)|
|Baker, Nicholas (Dorset N)||Hunt, David (Wirral W)|
|Batiste, Spencer||Hunt, John (Ravensbourne)|
|Benyon, W.||Hunter, Andrew|
|Bevan, David Gilroy||Irvine, Michael|
|Biffen, Rt Hon John||Jack, Michael|
|Bonsor, Sir Nicholas||Janman, Tim|
|Boswell, Tim||Jones, Gwilym (Cardiff N)|
|Bottomley, Peter||Jones, Robert B (Herts W)|
|Bowden, A (Brighton K'pto'n)||King, Roger (B'ham N'thfield)|
|Bowden, Gerald (Dulwich)||Knapman, Roger|
|Bowis, John||Knight, Greg (Derby North)|
|Brazier, Julian||Knowles, Michael|
|Bright, Graham||Lawrence, Ivan|
|Buck, Sir Antony||Lightbown, David|
|Burns, Simon||Lilley, Peter|
|Burt, Alistair||Lord, Michael|
|Butcher, John||Lyell, Sir Nicholas|
|Butler, Chris||McLoughlin, Patrick|
|Carlisle, Kenneth (Lincoln)||McNair-Wilson, Sir Michael|
|Carrington, Matthew||McNair-Wilson, P. (New Forest)|
|Carttiss, Michael||Malins, Humfrey|
|Cash, William||Mans, Keith|
|Channon, Rt Hon Paul||Maples, John|
|Chapman, Sydney||Martin, David (Portsmouth S)|
|Chope, Christopher||Mayhew, Rt Hon Sir Patrick|
|Conway, Derek||Meyer, Sir Anthony|
|Coombs, Anthony (Wyre F'rest)||Miller, Sir Hal|
|Coombs, Simon (Swindon)||Mills, Iain|
|Cope, Rt Hon John||Mitchell, Andrew (Gedling)|
|Cran, James||Mitchell, Sir David|
|Currie, Mrs Edwina||Morrison, Sir Charles|
|Davies, Q. (Stamf'd & Spald'g)||Moss, Malcolm|
|Davis, David (Boothferry)||Neubert, Michael|
|Day, Stephen||Nicholls, Patrick|
|Devlin, Tim||Norris, Steve|
|Douglas-Hamilton, Lord James||Page, Richard|
|Dover, Den||Paice, James|
|Durant, Tony||Peacock, Mrs Elizabeth|
|Fairbairn, Sir Nicholas||Porter, David (Waveney)|
|Fallon, Michael||Rattan, Keith|
|Favell, Tony||Rathbone, Tim|
|Fenner, Dame Peggy||Redwood, John|
|Fishburn, John Dudley||Rifkind, Rt Hon Malcolm|
|Forman, Nigel||Sackville, Hon Tom|
|Forsyth, Michael (Stirling)||Speller, Tony|
|Forth, Eric||Taylor, Ian (Esher)|
|Franks, Cecil||Taylor, John M (Solihull)|
|Freeman, Roger||Thompson, Patrick (Norwich N)|
|French, Douglas||Thurnham, Peter|
|Gale, Roger||Tredinnick, David|
|Garel-Jones, Tristan||Trotter, Neville|
|Gill, Christopher||Twinn, Dr Ian|
|Goodson-Wickes, Dr Charles||Waddington, Rt Hon David|
|Gow, Ian||Walden, George|
|Greenway, John (Ryedale)||Walker, Bill (T'side North)|
|Gregory, Conal||Waller, Gary|
|Griffiths, Peter (Portsmouth N)||Wardle, Charles (Bexhill)|
|Grist, Ian||Watts, John|
|Hamilton, Hon Archie (Epsom)||Wells, Bowen|
|Hamilton, Neil (Tatton)||Wheeler, John|
|Hanley, Jeremy||Whitney, Ray|
|Hannam, John||Widdecombe, Ann|
|Wolfson, Mark||Tellers for the Ayes:|
|Wood, Timothy||Mr. David Maclean and|
|Yeo, Tim||Mr. Stephen Dorrell.|
|Adams, Allen (Paisley N)||Macdonald, Calum A.|
|Barnes, Harry (Derbyshire NE)||McFall, John|
|Beith, A. J.||McKay, Allen (Barnsley West)|
|Bray, Dr Jeremy||McKelvey, William|
|Brown, Gordon (D'mline E)||McLeish, Henry|
|Brown, Ron (Edinburgh Leith)||McTaggart, Bob|
|Buchan, Norman||Marshall, David (Shettleston)|
|Campbell, Menzies (Fife NE)||Martin, Michael J. (Springburn)|
|Canavan, Dennis||Maxton, John|
|Clarke, Tom (Monklands W)||Meale, Alan|
|Clay, Bob||Michael, Alun|
|Clelland, David||Michie, Mrs Ray (Arg'l & Bute)|
|Cohen, Harry||Moonie, Dr Lewis|
|Cook, Robin (Livingston)||Morgan, Rhodri|
|Cryer, Bob||Mowlam, Marjorie|
|Darling, Alistair||Nellist, Dave|
|Dewar, Donald||O'Neill, Martin|
|Dixon, Don||Pike, Peter L.|
|Doran, Frank||Reid, Dr John|
|Douglas, Dick||Robertson, George|
|Eadie, Alexander||Ross, Ernie (Dundee W)|
|Foster, Derek||Skinner, Dennis|
|Galbraith, Sam||Smith, Andrew (Oxford E)|
|Godman, Dr Norman A.||Steel, Rt Hon David|
|Graham, Thomas||Strang, Gavin|
|Haynes, Frank||Wallace, James|
|Henderson, Doug||Wareing, Robert N.|
|Home Robertson, John||Welsh, Andrew (Angus E)|
|Hood, Jimmy||Wilson, Brian|
|Hughes, John (Coventry NE)||Wise, Mrs Audrey|
|Hughes, Robert (Aberdeen N)||Worthington, Tony|
|Kennedy, Charles||Tellers for the Noes:|
|Lamond, James||Mr. Thomas McAvoy and|
|Lewis, Terry||Mr. Nigel Griffiths.|
§ Question accordingly agreed to.
That the draft Housing Support Grant (Scotland) Order 1989, which was laid before this House on 15th December, be approved.