HC Deb 24 May 1989 vol 153 cc940-1
6. Ms. Primarolo

To ask the Secretary of State for the Environment if he will give the latest figures for homelessness arising from mortgage repossessions in the south-east and south-west of England.

The Parliamentary Under-Secretary of State for the Environment (Mr. David Trippier)

Estimates from local authority returns for the fourth quarter of 1988 are that about 300 households in London and the south-east, and about 100 in the south-west, were accepted by local councils as homeless as a result of mortgage repossessions.

Ms. Primarolo

Does the Minister accept that as a result of the Government's continuing disastrous economics policies, which brought yet another rise in interest rates today, the problem of mortgage repossessions is becoming even more serious? Is it not true that the figures that he gave do not take into account repossessions by banks and finance houses, and that the true proportion of homeless people in the priority need group presenting themselves to local authorities is one in 10? Is the Minister aware that the situation is deteriorating rapidly, and what action does he intend to take to solve this disastrous problem in the housing market?

Mr. Trippier

I can only describe the hon. Lady's figures as nonsense. The figures that I have already given in the substantive answer do not help the case that she is seeking to advance. The truth is that, according to the latest statistics, there has been a decline in the number of mortgage repossessions in the past two years. On the very point that the hon. Lady made about the economy, the director general of the Building Societies Association recently said: The decline in the number of repossessions and arrears is consistent with the improvement in performance of the economy in recent years and … the sharp fall in unemployment since the middle of 1986.

Mr. Heddle

Does my hon. Friend agree that the best advice that he can give those who find themselves in difficulties with their mortgages is not to wait until the 59th minute of the 11th hour with the bailiffs knocking at the door, but to go to the building society office that they deal with, put the problem to them and reschedule the borrowing? Does he further agree that in such cases there may be a case for building societies and other reputable lending institutions to take properties back and relet them to the former owners to prevent pressure on housing waiting lists?

Mr. Trippier

I agree with my hon. Friend's earlier point. That is sound advice. Experience has shown that in those circumstances building societies are, in the vast majority of cases, sympathetic, and that has contributed to the fairly dramatic fall that we have seen in the figures that I have already given to the House.

Mr. Soley

The Minister's figures are misleading because they apply only to building societies, as the societies make clear. My hon. Friend the Member for Bristol, South (Ms. Primarolo) is right. The fastest growing area of homelessness for families is mortgage repossessions from all mortgage companies and the local authorities are having to pick up the bill. Why does not the Minister put that right? Does he remember the Tory party's promise in 1979 given by his ex-housing spokesman, supported by the Prime Minister in 1980, that mortgage rates would not rise above 9.5 per cent. under the Tory Government? Except on two brief occasions they have never been under 10 per cent. in the past 10 years.

Mr. Trippier

The hon. Gentleman knows why we have to have this temporary period of high interest rates. Several undertakings have been given by my right hon. Friends the Prime Minister and the Chancellor of the Exchequer on that front. The main purpose is to reduce inflation—a lesson that was never learnt by the Labour party in office when its record was disastrous. We have not got anywhere near the 27 per cent. that inflation reached then.

I question where the hon. Gentleman gets his figures for his earlier point. We have to give the figures that are available from a number of sources. They have to be correct and subject to parliamentary reply. The hon. Gentleman's figures are pure hypothesis.

Mr. Squire

Does my hon. Friend agree that, given that all the published statistics show that homelessness through mortgage arrears is a small proportion of those facing homelessness, the only purpose of the campaign being waged by the Opposition must be to alarm many people who have fallen into mortgage arrears and possibly to deter those who would otherwise buy their homes?

Mr. Trippier

I could not agree more with my hon. Friend. I genuinely believe that the campaign to which he referred which has been waged this week will not do a single thing to solve the problem—not a single thing. To put the matter in perspective, although it is distressing to the people involved—I emphasise again that no individual or political party has a monopoly on compassion—the latest figures show that less than one third of 1 per cent. of mortgage advances result in possession of the property by the lender.