RENT BILL

HL Deb 16 April 1957 vol 203 cc25-98

3.55 p.m.

Debate on the Second Reading resumed.

LORD AMULREE

My Lords, before I say a few words on this Bill I should like first to apologise to the noble Earl who moved the Second Reading because I was not in my place when he began his speech. I can assure him that I meant no discourtesy to himself, or to the Bill. It is just another example of one trying to be in two places at once.

Coming to the Bill itself, I think I can say that, in general, noble Lords on these Benches approve the principle behind it. We have felt for some time that there should be some decontrol of rents—not in a very violent fashion, but rather in a gradual way. At the same time, we realise that decontrol would cause quite a number of people to pay an increase in rent. I agree with the noble Lord, Lord Silkin, that the increases are going to be rather bigger than one thought possible at one time. I agree with him, too, that they will cause considerable hardship to many people. Whether it will be possible to modify this state of affairs by making Amendments on the Committee stage, I do not know; but I certainly think that we should see whether we can do something to curtail the damage which will be done to some people.

Another point about which I am rather worried is whether the provisions in the Bill for the repair of dwellings will be as successful as people hope they will be. That is an important problem facing the country at the moment. We have a large number of houses which are over 75 years old. I am informed that the figure is somewhere in the neighbourhood of four million, but if that is not correct I am prepared to accept a lower figure. I think, however, that there are somewhere in the neighbourhood of four million houses which are more than 75 years old. The Act passed in 1954 represented an attempt to get some repairs done to premises, but the provisions of the Act were too timid and not a great deal of work has been done. In some parts of the country conditions are particularly bad—I would mention London, the Midlands and the North. Some extremely bad houses exist in those districts, possibly not bad enough to be pulled down under an order, but certainly requiring a great deal of repair. In North London, in a part which I know quite well, certain houses are to be pulled down and others are not. From the outside they look most attractive. They are rather pretty houses, built in about 1850 or 1860. When they have a little paint put on them they look most attractive. But inside one finds quite a different story, and a large amount of repair is necessary. That is why I should have liked to see more incentive given to landlords, to encourage them to repair houses.

As I think has been pointed out already, a large number of landlords are not wealthy people. A considerable proportion of them have only one or two houses and they just cannot afford the money for repairs. Even though landlords may now be able legally to put up the rent, some of the tenants may not be able to pay the rent; therefore that will not work, and it certainly will not bring in enough money properly to carry out the repairs. I should like to see an extension of the policy which enables local authorities to make loans for improvements, so that there might also be loans for repairs, for it seems to me that there is going to be great difficulty in drawing the line between repairs and improvements. Though there may be a big difference at one end of the scale, the difference must from time to time be very slight.

It has been said that the Bill will help to deal with those cases where premises have too few people living in them. I rather agree with the noble Lord, Lord Silkin, in doubting whether the number of such premises is very great. One is told that there are many instances where families have gone away and the old couple continue to live in a house far too large for them. I should like to know whether it has been possible to obtain the figure of those cases. It would be extremely difficult to find out, but even if it were possible to do so, I doubt whether the number would be found to be very large. I suppose one might say that if there were any number of people living in houses too large for them and the rent were put up, that might encourage them to take in lodgers to make a little more money, although that is not a very charitable idea. Failing that, if they cannot afford to pay the extra rent they will have to move.

Local authorities, therefore, should be encouraged to provide accommodation for old people in new premises, so far as possible. Some local authorities have done a great deal in that way, and one finds on new housing estates that there are flats or houses for old people. On the other hand, some local authorities have been extremely backward in this respect, and they should be encouraged to do more. It might be possible for a court to refuse to give an order for possession, if a landlord wanted to turn out an old couple or pensioners, in cases where the local authority have not done anything to make suitable accommodation available for such people.

The noble Lord, Lord Silkin, brought out one point which I thought very attractive and which I was going into at greater length than I will now do—the question of an exchange of houses between people who want to move from one part of the world to another. That has always seemed to me an extremely sensible thing to do and I cannot see why some attempt has not been made to do it. I concede that there would be considerable administrative difficulties involved, but, as those who have come across such difficulties will know, the thing to do with them is to overcome them. They can be, and usually are, overcome. I am never impressed with the argument of the difficulty of administration. Often it is the civil servant who does not know what to do who speaks of administrative difficulty, in order to cover up a multitude of sins. Another point which I do not like is that the Minister has power to vary the value of decontrolled houses by order. I am sure that that is something which should be properly debated by both Houses. I would rather see it done by legislation than by an order from the Minister on which there is never a proper chance of discussion.

THE EARL OF MUNSTER

My Lords, the noble Lord will realise that it is done by an Affirmative Resolution of both Houses.

LORD AMULREE

My Lords, I entirely agree, but even then there is not so much chance for debate as when new legislation is brought in. One thing which we should do—and I trust we shall do something towards it—is to encourage repairs to existing properties, do what we can to build houses and, so far as possible, see whether the present cost of building can be reduced. I know little about the subject, but one sometimes comes across cases where the cost of building seems very high, and one hears stories (though I do not know whether they are anything more than that) to the effect that a number of price rings exist in the building trade as well as in others. If that is true, I hope the matter will go before the Monopolies Commission. It seems to me to be one of the most important things with which they could deal: for proper housing, is at the bottom of all public health and most preventive medicine. If people have not go proper housing, they will not lead proper, healthy lives, no matter what they are paid or what social services are put forward for them. We have done a great deal in that line but still seem to lag a long way behind. I am sure that money properly spent on housing and housing repairs will go a long way towards cutting down some of the expense of the National Health Service, which is something we should all very much welcome.

4.6 p.m.

VISCOUNT RIDLEY

My Lords, whatever we may think about the detailed provisions of this Bill, there is no doubt that Her Majesty's Government are to be congratulated on having produced a novel approach to a very large part of the Rent Restrictions Act—by that, I mean the method of settling rents at whatever level they should be. I have always looked upon rent restriction as, in essence, a form of rationing of a scarce commodity. In the First War, when the original Act was introduced, those who brought it in must have had in mind that this was a temporary arrangement, introduced because during the war houses were scarce. The object was to keep the price fairly reasonable and to make it as fair as it could be for those who could not afford higher rents.

Through the years between the wars, as the housing situation got better there has been a gradual process of easing of the Acts. At one time we had decontrol by vacant possession. We had decontrol of blocks of houses of different rateable values. In 1920, there was an Act to authorise increases of rents. All that was proceeding in a fairly regular and orderly way until the Second War came. Then the Act of 1939 changed everything. I have often wondered whether that Act, which was deemed to be necessary as a means of rationing, to avoid the scarcity resulting from the war really did any good until 1945. All that, however, is speculation which is now of no importance, because there is no doubt that by 1945, and in the years after the war, some extension of that kind was necessary. But it seems to me that, just as between the wars the rents of houses increased from time to time as they were decontrolled, we have now reached a situation where a further step must be taken. I remember that discussions before the war used to turn on a total number of about 13 million houses in the United Kingdom. I believe that the figure is now about 15 million. Though the population has increased, it seems clear that to some extent, at any rate, housing pressure has been reduced.

This seems to me an interesting Bill because it attempts to be a logical development of the process of modernising the Acts which one hopes will come to an end at a time when the housing shortage ends, when rent restriction will no longer be necessary. The Bill attempts to provide some simplification of the Rent Acts and, at the same time, adds to them in number. In the Eighth Schedule there is a whole list of Acts of Parliament which are repealed in part, though I am sorry to say that the parts repealed are very small—just one or two sections here and there. And to other parts there are Amendments. In all, twenty Acts are involved in this way, not all of them Rent Restrictions Acts—there are Housing Acts, and others.

That leads me to suggest, since it looks as if rent restriction is likely to continue for a good few years yet, that whatever is the right step to take at the present time, it, would surely be of great benefit to the public at large if all these Acts could be put together. That has been the request of, I think, all, but certainly the last two, departmental committees which have considered the Rent Restrictions Acts and, have found the difficulties they bring for people. Not being a lawyer, I cannot put the matter in a way which would explain the necessity for some sort of consolidation, but I feel that the ordinary person suffers a good deal from the difficulty of understanding all the different Acts. There is one interesting point in this Bill: in one place at least, in Clause 15, it goes outside the field of rent restricted houses, and provides for a minimum notice of four weeks for all houses that are let, many of which never have been, and never will be, within the Rent Restrictions Acts, including local authority houses. That in itself seems to me a good feature. I personally would feel that the period of a month might well be longer. That, however, is a matter of detail.

It seems, therefore, that in this process of development of the Acts there are two things that have to be considered; and the Government have considered them both. One is what is a fair and proper rent at the present time for a house which remains controlled; and the second is, how far is it safe to lift houses out of control without inflicting hardship. As to the first point, it is not necessary to repeat the obvious thing which is so well known, that not only are the rents low but they are extraordinarily inconsistent, settled by the accident of history and with no reason at all in them.

It was always said that it would never be possible to have a regular system of controlling the rents of rent-restricted houses until there was uniformity of rating. Now that we have it, the Government have, I think, taken a very wise decision in deciding to use the new rating assessments as the yardstick of what the rents should be. I myself never thought that the old rating system had such very wide variations from one local authority to another that it was not possible to use it as it was; but if we believe (and I think it is universally accepted as a fact) that the new system does give pretty good uniformity throughout the country, we must feel on safe ground when this new gross value is adopted as the basis for fixing maximum rents. I do not think one can say that twice the rateable value is excessive. Rateable values are, in fact, based on the 1939 value of the house—indeed, I think the noble Earl who introduced the Bill said that this is one of the few things which has increased only by twice since 1939.

Here I would beg to differ from the noble Lord, Lord Silkin, because the period of that increase is from 1939, and I think he referred to the fact that many people who owned the houses in 1940 were no longer in existence and, therefore, would not suffer any loss by not having an increase in their return. I think the fair comparison would be between 1939 and the present time. Many of the houses, after all, are well below the rateable value of £30 which is the maximum figure if a property is to remain in control. If you work out the corresponding rent from the gross value of those houses, I think you will find that, even now, they are substantially below, at any rate, the later built of the local authority-owned houses. I myself very much doubt whether there would be any case at all to lead to further demands for wage increases on these grounds. There are, I think, only about 4½ million houses which are affected by these rent variation provisions, out of a total of nearly 15 million in the whole country; so that the fact that about one-third of the houses—and the cheapest ones—have their rents put up would hardly justify an increase for the whole working population, many of them living in newer and more modern houses already let at much higher rents than the figures to which these older ones are to be increased.

On the repairs Schedule, I have two points to which I would refer. I agree about the complication and delay to which Lord Silkin referred. I think he, with his legal knowledge, referred to six visits to the county court. It certainly seems a complicated procedure. I would say this for it: that it does one thing, which I believe is of great benefit. As I understand the matter, at the present time, as the Acts now are, there are only certain houses in respect of which it is possible to get a certificate of disrepair—that is, houses which come under the old control. I think I am right; no doubt I shall be corrected if I am wrong. Under this Bill it will be possible to get such a certificate for all houses which were under control up to the date of the passing of this Bill, whether they were under the new or old control; and the certificate of disrepair will be able to remove the increase which is granted by this Act. That means it applies to all houses which come within this series of Acts.

On the other hand, there is a weakness in that here again the provision is so chancy, depending on what the pre-1957 rent was, if I may call it that. Because your Lordships can well imagine, remembering all we have heard of the large variation in rents paid for similar properties, that in the case of a good many of them there may be a very small increase due to the owner, in the form of rent, under this Act. The certificate of disrepair can only remove that small increase. In the case of other houses the permitted increase may be very much larger. In such cases the certificate of disrepair will be a much more powerful inducement for the owners to keep the houses in repair. I would rather have seen something following the certificate of disrepair which would deduct from the rent paid while the certificate was current a uniform percentage applicable to all houses which remain within control.

There is a point in Clause 5 (3) which has interested me very much. It concerns improvements. As I understand it, at the present time the tenant has the right to object to an improvement being carried out if he is asked to pay his 8 per cent. share in the form of rent. By the proviso to Clause 5 (3) it looks as if the right of the tenant is being taken away, because at the very end, where the subsection is talking about the tenant not being able to apply for a reduction or avoidment of his 8 per cent., the proviso uses the words: or if a tenant under the controlled tenancy consented in writing to the improvement ". It looks as though, if he did not consent, it could be done in spite of him. That point, I feel, might be clarified.

There is a point of policy. In many cases, arguments were at one time widely used supporting the proposition that there were certain numbers of blocks of flats and rows of houses where improvements were necessary and desirable in the interests of the tenants, and that those tenants were willing in most cases, to pay the increase of 8 per cent. on the cost but one or two often refused to pay and held up the whole scheme. It was argued, therefore, that in such cases the owner should have the right to go to court and get authority to carry out the improvements to the whole group of houses and charge 8 per cent. throughout. In future cases that might well be a valuable thing to have. It is worth while to consider putting this somewhere in Clause 5 with a proper safeguard against the proposal being made in an unreasonable way.

As to Clause 10, I do not know how one can feel certain that the £40 in London and the £30 elsewhere are the right figures. I should have liked to see either some argument supporting the use of these figures in these different areas or else some differentiation of areas and the appropriate rateable values with them. Without being able to quote any figures or statistics, I would imagine that it is generally felt that many of the larger cities have as bad and difficult housing problems as have many parts of London. I should not be at all afraid if I saw a schedule of different rateable values applicable to different local authorities in the country. And I do not think one need be afraid of boundaries. After all, we can be certain that local authorities always know their own boundaries, and there can never be any doubt as to where a house is. We accept the boundaries of London and the rest of the country, and we accept willingly and without question the boundary between England and Scotland.

I also feel a little doubtful whether, at this first stage, this figure of £40 in London is high enough. In that connection, unlike the noble Lord opposite, I rather like the idea that the Minister should have power to make orders varying the amounts and letting out certain groups of houses in certain areas. On the other hand, I should have preferred to see allied with Clause 10 (3) something in Clause 10 (1) whereby the Minister should have equally during this period of fifteen months power to delay certain groups of houses in certain areas from being decontrolled. It seems to me that during that fifteen months it will be possible to see what effect is likely to result from the decontrol operations, and lit should be possible to delay decontrol of houses of from £40 to £50 rateable value in London and £30 to £40 in Bristol or Plymouth or somewhere else—I do not know. I am not suggesting that there should be power to put back into control houses which have come out, but I say that, as a corollary to Clause 10 (3), there could well be in Clause 10 (1) power for the Minister to exercise some delay if it seems that the difficulties which are feared by some people are likely to eventuate. But I doubt whether those difficulties are really as great as they are thought to be.

The noble Lord, Lord Silkin, referred to people who buy up houses in the hope of selling them with vacant possession, and to the fact that people are not willing at the present time to let houses. If the idea is that owners will sell with vacant possession, and if nearly 800,000 houses become empty in fifteen months' time, it does not look to me as though there is the remotest possibility of finding buyers who have, or who can get, the money with which to buy all those houses so suddenly. Those who have experience of building societies and other institutions engaged in financing the purchase of small houses of this kind would very much query whether there is any possibility of these houses, in fact, being sold. That would seem to me to lead to the point that vacant possession value will probably disappear. There are only two things I think which have vacant possession value: controlled houses and farms which have their rents controlled by the Agriculture Act, 1947. If control is removed, I think that vacant possession value will tend to disappear also. It has, in fact, tended to diminish lately owing to the large number of houses available.

There is one point which I might interject, though it is perhaps hardly appropriate in a Second Reading debate. I notice that when importing this new method of settling rents the Government have brought in gross value and at the same time have adhered to the net value as a definition when a house comes out of control. It is a small point, but it seems to me that it might make matters easier if in both cases they said either "gross" or "net"—it would not seem to matter very much which, as they have to each other an almost constant relationship. One point in the Fourth Schedule seems a little difficult. On the three-year lease the intention, I see, is to persuade the owner to make a long lease so that he can get his rent increase straight away. But what I do not see there is the means whereby you can persuade him to carry out what I think is one of the objects of the Bill, particularly in the case of the larger houses (and, indeed, the over £40 houses will mostly be the ones affected): that is sub-dividing the house and still keeping the tenant in. I should like to see something positive there, so that if the owner was willing to start his alterations and sub-divisions in some of the larger houses he should be able to start straight away and get his rent as soon as he can.

A further point of a similar kind in Clause 10 comes in the proviso to subsection (2). If an existing statutory tenant is given a lease of a building or part of it, the house does not become decontrolled. I do not quite understand that provision, because I should have thought that that would discourage owners from sub-dividing their houses and allowing the possibility of the former tenant of the whole house remaining in part of it. I think that that will be the object of many owners, particularly of those who wish themselves to live in part of their own houses and let the other part. After all, I think you have to try to think what inducements can be given to people to do the things you want them to do. I believe that that is what you want them to do, and I think that you might be able to persuade them by those means. As it is now, it seems to me that a person with perfectly genuine intentions who wants to do that is either debarred from getting any increase at all for fifteen months or is debarred from having part of his house decontrolled.

I fear that I have perhaps referred to detailed points rather than to matters of a more general nature such as are commonly considered in a Second Reading debate. But there is so much detail in this legislation that it is almost impossible to avoid it. I believe that this is a very useful Bill, which will do a great deal of good. I hope that the Government will be willing to consider Amendments on the lines which have been put forward this afternoon; and although one cannot but feel uncertain of the effect of the decontrol of these 800,000 houses, I believe that the Government are right in saying that it will not cause anything like so much upheaval as has been suggested.

4.30 p.m.

VISCOUNT GAGE

My Lords, it seems to me that the one thing which has emerged from this debate and from the debates in another place is the unfortunate fact that for the first time for a long period the two main Parties are in head-on collision on housing policy. In this Bill, the Government say that what we used to call working-class houses must continue to be supplied by private enterprise, and must be well maintained and let at reasonable rents. On the other hand, the Labour Party, in their pamphlet on housing, say that the whole of this idea is absurd and that the only solution is—to quote the pamphlet itself: municipalisation on a scale that will dwarf into insignificance any other such measures yet undertaken. Hitherto, administratively, it has always been possible to maintain some continuity; because although one Party concentrated more on municipal housing and the other on private housing, it was always possible to fit in one with the other. But now there seems to be some prospect that every few years there will be a fundamental change of policy at Whitehall: an unfortunate prospect for the many thousands of people who are working in a voluntary capacity in local government housing associations, quite apart from the owners themselves.

I also think that this head-on collision is going to accentuate the emotional and unreasoning feeling that now circles round housing. As a boy, I remember that the same sort of feeling existed on the question of the people's food. Whenever some measure was taken with the object of improving agriculture, it was met with the cry, "Your food will cost you more," very much in the same way as any measure designed to avoid the dereliction of houses has been met with the cry, "Your rents will go up." Yet what an astonishing change has come over our thinking about agriculture. The two main Parties not only support each other but vie with each other in proposing a highly scientific and complex structure of prices and guarantees. In fact, there is almost a bipartisan policy with regard to agriculture, to its very great advantage, the only exception being over the question of the agricultural cottage, which is still bedevilled by Party politics and which has suffered very much in consequence. What a wonderful thing it would be if a similar bipartisan policy could be applied to housing and if there were a similar revolution in thinking about housing! Then we could feel that we were getting somewhere. I agree that it sounds almost presumptuous for a Back-Bencher to express such views in present circumstances; but as one who is connected with administration in various capacities, I cannot help wondering what are the real prospects in future.

I suppose that this Bill will be passed very much in its present form and that the campaign against it will be continued; and if there is hardship and repairs are not done, we shall probably hear all about it. For myself, I believe that the Bill will work differently in different areas. As I have mentioned in your Lordships' House before, movements are going on in the population, particularly towards London and the South East, and while this is happening there will never be enough houses or, for that matter, enough schools or any of the other benefits of the Welfare State. For instance, I believe that some elderly people may have a rough time. They not only will be endangered by the desirability of putting up rents, but also will be threatened by displacement to make room far key workers. But in other areas I think that the Bill will work without any difficulty at all.

I am glad to see in Clause 10 (3), which has been referred to, that the Minister takes power to decontrol regionally. That is the next stage of decontrol. But it is not clear why that principle has not been applied in the present Bill. As I have said, I have no doubt that any difficulty there is in the Bill will have plenty of publicity. What I am not so certain about is whether the Opposition scheme will get equal publicity. I know that in another place it was difficult to refer to it on the Second Reading of the Government Bill. I hope that your Lordships will not think that these remarks are out of order, because the mere existence of this scheme may have an immediate effect on the prospects of this Bill. The Labour scheme provides for the acquisition of a large number of rented houses. Clearly, that in itself is not a great encouragement to owners to spend money on improving them or in repairing them now. Recently I had to decide to carry out a number of cottage improvements. I am glad that I have done them, but I cannot regard them as an attractive investment financially, and feel that the existence of this scheme might dissuade people who have not quite made up their minds.

I think that it might also have less obvious consequences. It has been suggested to me by well-informed people that the effect of decontrol, plus the shadow of the Labour scheme, might increase the number of owners who desire to sell their houses. I was interested to hear the noble Viscount, Lord Ridley, say that he thought that that danger might be exaggerated; but if there is a danger, I think it would be accentuated by the publication of the Labour scheme. For that reason, I think that we are entitled to find out so far as we can what are the real intentions of noble Lords opposite. I have read the pamphlet, Homes for the Future, more than once. It might be my stupidity, but it seems to me to be capable of a number of interpretations. It may mean what the Conservative Central Office says it means: that 6½ million houses will be taken over wholesale as from the appointed date. From some references in the pamphlet, it may mean that the process will be much longer drawn out. It may mean little more than a kind of extension of slum clearance, the acquisition of houses to recondition them rather than to pull them down, in which case I cannot conceive that the Conservative Party can object to it, seeing that that has been done successfully under existing law in Birmingham and elsewhere today.

My own guess is that if this pamphlet were submitted to local authorities, as apparently is the intention, it would emerge in a somewhat different form from that contemplated by the Conservative Central Office. I suppose that quite constitutionally Parliament can order local authorities to do anything they like. They can say, theoretically, to some of the smaller borough councils and district councils, "You are now looking after 700 houses; as from the appointed date you will look after 3,000. If it means doubling or trebling your staff, or doubling or trebling the amount of time taken by your members in committee, well, to use the vernacular, that is just too bad." Parliament can say those things and be constitutionally justified. But I have never known any case where a Government talked like that to local authorities if they wanted anything done.

When I think of the sort of approach made to local authorities on other issues—for example, on local government reform, which, incidentally, is touched on in this pamphlet—and when I think of the innumerable consultations and processes which have been going on for some eight years, and how very gingerly the matter was approached, the somewhat dictatorial language of this pamphlet does not seem to me to be very realistic. I cannot believe that even a majority of local authorities would wish to take on a vast and nebulous new responsibility with any degree of enthusiasm. But if they did acquire these houses, surely the first thing they would do would be to raise the rents.

The noble Lord, Lord Silkin, made a great point about the hardships that would be suffered by the poor when rents were increased. But surely that danger is equally great if the houses are to be acquired by local authorities. The noble Lord said that people would be driven on to public assistance. Again, I have never known any local government, new town corporation or even housing association have the slightest hesitation in making old people go on to public assistance; otherwise, they would be subsidising out of local funds what ought to be borne by national funds—one of the greatest crimes that can be committed by local government officials. That is another point that we might well ask noble Lords opposite to develop. What I have said, of course, is all guess-work. But I think it is fair to ask noble Lords to explain that point, and the question of which of the interpretations I have suggested can be adopted.

It would certainly seem to the uninitiated that noble Lords opposite are in somewhat of a dilemma: either they are going to do a great deal in a short time, with some of the consequences that I have been suggesting, or they are going to do less, or perhaps the same amount, in a much longer time. In that case, what will happen? How do they suggest that all this residue of housing should be kept in commission and improved? That is what I understand to be the main object of this Bill: to produce better houses, even at the cost of higher rent. Whether the Government will succeed in that remains to be seen; it may be that they will succeed in some cases, but not in others. But as an experiment, and, as I think, a courageous experiment, to deal with a situation that has for years been described by politicians of all Parties as "political dynamite", nobody can accuse the Government of introducing a vote-catching device. In my humble capacity I would favour a bipartisan approach to this problem. I was glad to see, in regard to one organisation with which I am concerned—namely, the housing association movement—that both Parties seem to have a good word to say for that. It is the only way in which I see any sign of a bipartisan approach. It seems to me that the Government scheme is the only one that seeks to attack this difficult problem in an honest way. I hope that their calculations will prove to be right, and I support in general the principle of the Bill.

4.45 p.m.

LORD CONESFORD

My Lords, it is common ground, I think, in all sections of the House that this is a measure of first-class importance. Whatever differences there may be between the Parties about the remedies that should be applied, it is, I think, impossible for noble Lords or others who have studied the position to deny the seriousness or the nature of the evils with which it is the duty of the Government to contend. My noble friend who moved the Second Reading in such an able and comprehensive speech said that he would not make many quotations from leaders of the Party opposite which would support the Government's case. I agree with him that it would be easily possible to do so; I have read, and have available, a great number of them. However, I agree that to quote them might be to embark on unnecessary controversy; and it might be more useful to give a single quotation, which I think sets out the facts clearly and well, from a source which is often quoted with respect in different quarters of this House.

On the Second Reading of this Bill in another place an interesting extract was given from a leading article in the Manchester Guardian of last November. This short extract states the main problems so clearly, to my mind, that I venture to quote it to your Lordships' House. This is what the Manchester Guardian said about rent restriction: It discourages the landlord from keeping old houses in good repair, and so increases the rate at which they become uninhabitable. It further diminishes the number of houses to let by encouraging the sale of those which fall vacant, and deterring the letting of those which have previously been owner-occupied. It creates a vested interest in a sitting tenancy, and so prevents large houses from being made available for growing families by the removal of shrinking households to smaller premises; by the same token, it inhibits the movement of redundant workers to places where their labour is needed. Every sentence of that quotation is true, and each one has great public importance.

I have no such advantage as my noble friend Lord Ridley, who speaks with so much authority on all questions relating to housing, or my noble friend Lord Gage, who has so much knowledge of local authorities and other aspects of this subject. No one, however, who was a Member of the other place for some twenty years, and who was so often, as we all were, consulted by constituents on housing matters, can have remained ignorant of the problems with which this Bill seeks, and I think seeks courageously, to deal. But I have an even earlier recollection of concern with these matters than my experience as a Member of Parliament.

I remember, as I am certain any other legal practitioner of my age will remember, what chiefly occupied the county courts immediately after the First World War, when some of us were beginning at the Bar. I suppose the great majority of cases concerned that very Act of 1920, which is the first of the Acts mentioned in the Schedule to which my noble friend Lord Ridley referred, the Act which was so long known, and in fact, for certain purposes is still known, as the principal Act. As my noble friend Lord Ridley Nightly said, we all knew at that time that some such Act was necessary for the immediate purpose for which the legislation had been introduced. But the defects of that legislation were even then becoming noticeable. I venture to say that, whatever differences on political matters there might have been among those of us who heard these cases day by day, if there had been any one of us who had prophesied that thirty-eight years later that Act would still remain a vitally important Act on this whole subject, he would have been regarded as a lunatic, so absurd would such a prophecy have seemed.

I think that Her Majesty's Government made careful inquiries, and made a most skilful study of this subject, even before they produced the first draft of this Bill. I think, however, that Her Majesty's Government would themselves be the first to recognise—as, indeed, my right honourable friend the Minister of Housing and Local Government has expressly recognised—that the Bill as originally introduced was improved in another place by the efforts of members of all Parties. I hope that under the skilled leadership of my noble and learned friend the Lord Chancellor we may, perhaps, make some further improvements at a later stage in this House. Nevertheless, it may be true that, when all that has been done, there may still be defects in the Act, as it appears on the Statute Book, that only experience will reveal. That is possible. I believe, however, it is true that an historian, 100 years hence, who studies our internal legislation of the first sixty years of this century, will give credit and praise to a Government which had the courage arid the skill to tackle this problem and wall greatly prefer its reputation to that of various earlier Governments which preferred to do nothing because the problem was so difficult.

There is a great deal that is common to both sides in this great controversy. In spite of the speech of the noble Lord, Lord Silkin, I would say that two things are admitted by the Government and by the Opposition. Those two things are that there must be a large measure of decontrol, and there must be a rise in rents. Whatever may be said for or against the alternative policy of the Socialist Party, it is quite clear that their policy of taking over, municipalising, all this rent-controlled housing implies just those two things. First, the houses in the hands of the local authorities are freed from all these rent restrictions, and the tenant has no security of tenure. Secondly, the local authorities, as we know from their administrations of their own houses, raise the rents. So the whole of the objections and appeal to pity of the noble Lord, Lord Silkin, in his speech this afternoon wholly ignore the policy put forward by the Party of which he is so distinguished a member. If it is really so monstrously cruel to raise the rents, then the local authorities are being monstrously cruel, because that is their present practice.

I noticed a passage in the speech of the noble Lord, Lord Silkin, in which he said that people who had gone to some of these new estates—he was clearly referring to municipal estates—found the rents so much higher that they went short of food. For what was that a plea? If it was an objection to this Bill, it was a plea that the private landlord should subsidise those people who would otherwise suffer from the action of local authorities. The more the speech of the noble Lord, Lord Silkin, speaking for his Party this afternoon is examined, the more it will be realised that every objection he raised against the policy adopted in the measure to which we are asked to give a Second Reading is a condemnation of the policy which his own Party are putting forward.

For many years I was frankly puzzled to know what form of land tenure the Socialist Party believe in. Their policy seems to me to be curiously ambivalent, to use one of their own favourite words. There are times when, from their speeches, I gather that they are in favour of houses being available to rent. But there are other periods when they seem to disapprove altogether of the landlord, and certainly of the landlord getting an economic rent. I am sorry that the noble Lord, Lord Silkin, is not here, but if I might remind him and my noble and learned friend the Lord Chancellor of matters that I think both will remember in the House of Commons, I will mention two rather interesting incidents that occurred in 1946 and 1947.

For a short period in the year 1946, the National Savings Movement produced a well-designed advertisement, which was prominently displayed and was calculated to be rather a success. The advertisement was entitled, "A Bit of Land of Your Own". It was considered by the experts who wished to collect National Savings that the prospect of saving in order to have "A bit of land of your own" was rather attractive. But this so shocked many members of the Socialist Party that the advertisement ran for less than a fortnight. A few months later, a Socialist Member supporting the then Government inquired of the Attorney General whether he would introduce legislation to end the system of leasehold tenure. The Attorney General said he was not prepared to abolish it, and added that it served a useful purpose for large numbers of people. I ventured, I remember, to put a supplementary question as follows [OFFICIAL REPORT, Commons, Vol. 433, col. 1364]: As Socialists seem to object equally to leasehold tenure and to a man owning his own house, can the right honourable and learned gentleman say what land tenure they want? Whether he could inform us or not I do not know. What I do know is that he did not.

To state my own attitude, I am strongly in favour as. I think, are the whole Conservative Party, both of men being allowed to own their own homes and of men being able to let or rent houses. One system suits one, another system suits another; but the point is that all are injured by the evils and distortions brought about by the existing Acts. The State, the landlord and the man who would like to be, but cannot be, a tenant are all injured, and all suffer. How does the State suffer? The State suffers, in the first place, by the waste and destruction of a great national asset, the great amount of housing which is simply and inevitably, unless some measure on these lines is carried into law, rotting and decaying. In fact, until my right honourable friend the present Prime Minister greatly increased the building of houses, it was calculated that the number of houses falling into decay was as great as the number of houses that the Socialist Government were managing to build at the current rate of building. The State suffers then, in the first place, by the waste and destruction of a great national asset.

I wonder what anybody would say if any other great national asset were being treated in the same way. Suppose the railways, or any other great national asset, were allowed to rot or decay, we should all think it quite mad, and should demand that something should be done to stop that folly and scandal. If it is to be stopped, if sufficient money is to be provided to enable potentially good houses to be kept in repair, who is to provide it? I think that in many cases the Government are quite right in holding that the contribution can be made by the sitting tenant. There is no reason at all in many cases why that should not be done. But assume for the moment that there was a case for somebody else bearing the burden, then surely the thing to do would be to provide that such other person should bear the burden; but to say that the unfortunate landlord, who may have no assets at all with which to do it, should continue to subsidise his tenant by keeping the house in repair, notwithstanding the uneconomic rent, is quite clearly to ask for the impossible.

How else does this system cause the State to suffer? It causes the under-use of a great deal of property and the overcrowding of other property. From the inability imposed on those who would like to move elsewhere, the State also suffers because, if they could move to another place and find a house which they could rent, such a move would be profitable to them and to their country. The landlord suffers from seeing his property decay and from his inability to let at an economic rent. In fact, he often subsidises a sitting tenant who is richer than he is. I agree with what my noble friend Lord Gage said in answer to the noble Lord, Lord Silkin, on the matter of Public Assistance. Let the noble Lord, Lord Silkin, examine what is happening with the tenants of the new towns and the municipal estates.

Last, but not least, of the people who suffer is the prospective tenant, the man who would like to be a tenant and does not wish to buy a house but, on account of the operation of these Rent Restrictions Acts, cannot find houses available for letting. This particularly applies to the young newly married couple. They are often not in the least in a position to buy, nor does anybody desire that they should buy, their house. They do not even know where for the greater part of their lives they are likely to live, but it would be enormously to their interest if more houses were available for letting. The noble Lord, Lord Silkin, suggested that there was nothing in this Bill which would increase the number of houses available for occupation, but that is not quite accurate because, of course, the effect of the existing legislation is that a great many houses are standing empty because the landlords simply dare not let them for what would be a new controlled tenancy; and, likewise, the Acts are preventing a number of houses, sometimes large houses, from being reconstructed, particularly in cities where they might produce more homes for people who really needed them in order to work there.

There are a few further points to which I would allude, in conclusion, because I know how many others wish to speak. It has been suggested that there are not nearly enough houses in the country to make it safe for Her Majesty's Government to carry this measure into law at the present time. It is worth remembering what Mr. Aneurin Bevan has said on this very matter. It has been frequently quoted, but I think it deserves to be quoted again. This is what he said on November 30, 1953 [OFFICIAL REPORT, Commons, Vol. 521, col. 826]: …taking the country as, whole, we are not very far away from the amount of total accommodation which the nation requires. Since then, not less than 800,000 new houses have been built. Therefore, if Mr. Bevan was anything like right in November, 1953, still more is that true to-day.

If I may mention one other point about the Socialist alternative policy, I wonder how much it would cost. The noble Lord, Lord Silkin, had something to say about inflation. He thought, rather curiously, that, if the owner of a house had suffered from inflation, he was only in the same position as many other people, and therefore nothing need be done about it. But, of course, he is not suffering merely from inflation; he is suffering from not being able to get an economic value for his property. That does not apply to other forms of property. If the noble Lord, Lord Silkin, had bought a picture or a piece of furniture, or anything else, as a result of inflation the value of that property would have gone up. If he wished to replace it by something similar, the fact of that appreciation could be realised; but by the Rent Restrictions Acts artificial depreciation of the property is inflicted on the man by legislation.

Let us examine for a moment the honesty of the Socialist proposal. Is it seriously proposed, in the only policy that has been mentioned as an alternative to the present measure, that all this property shall be acquired at a capital value based on the controlled rent and then at once let at an uncontrolled rent? I wonder if that is the policy. If there is another Socialist speaker who can speak with authority in this debate, I hope that that simple and fair question will be answered. If inflation is the fear, I wonder what is the estimate of the amount that this alternative policy would cost. One Front Bench speaker in another place, in a speech, I think, made outside the House, gave his own estimate as £2,500 million. I wonder whether the noble Lord, Lord Pethick-Lawrence, who speaks with such authority from the Benches opposite on questions of inflation, would regard the payment out of that sum as non-inflationary.

Finally, my Lords, I take comfort in one other thought. Great evils were prophesied by the noble Lord, Lord Silkin, if Her Majesty's Government carry this measure into law. I should be more impressed by that if I had not heard similar dire prophecies before from the Benches opposite—I agree, mainly in another place—whenever a Conservative Government have proposed any measure of decontrol. I comforted myself this morning by looking at a valuable cutting. It was taken from the front page of the Daily Herald of November 27,1952, when my noble friend who was then the right honourable Gwilym Lloyd-George, Minister of Food, had announced the decontrol of eggs. The headline in the Daily Herald was: The shilling egg? It is true that a question mark was put after "the shilling egg," but in the article below it was pointed out that nobody but the rich would again be able to eat an egg. My Lords, it was found that that fear of Conservative freedom was exaggerated; so I think it will be found that the prophesies of disaster from carrying this measure into law are also exaggerated. I believe that Her Majesty's Government have taken a courageous and necessary step. I believe that there was no hope of ending the distortions and injury to our economy which these rent control Acts inflicted, unless drastic but well-thought-out measures were taken. I congratulate Her Majesty's Government on this measure and heartily support it.

5.13 p.m.

LORD GREENHILL

My Lords, if I were a member of these Benches who could speak with authority, I might perhaps accept the challenge of the noble Lord, Lord Conesford, and deal with the hypothetical picture that he has drawn of what the Socialists would do if they came into power. Perhaps, with some modesty, I cannot regard myself as speaking with authority, and we must therefore leave to some future occasion the answer to the noble Lord's question. I have listened with considerable interest to the speeches made this afternoon upon this Bill, and although I disagree with a good deal of what has been said, I feel, on the whole, that the diagnosis of the situation does not greatly differ on the two sides. We all realise that we are faced with a difficult situation, but what we disagree about is, I think, the means by which we would prescribe remedies for the particular case with which we are dealing. I have no hesitation at all in saying that the headlong plunge—as I think the noble Viscount described it—between the two points of view is real. I think that the noble Earl, Lord, Munster, was also correct when he emphasised the difference in outlook between the two Parties.

But we are not at the moment concerned with what the Socialists would do with this Bill if they were in power. Nor can I understand what is meant by the noble Earl. Lord Munster, when he says that one of the three possibilities is that of placing all these houses in the hands of the local authorities, upon whose tender mercies the tenants would have to rely. It seems to me that if ever there was a body which was definitely responsible to the people as a whole, it is surely their elected representatives sitting as local authorities, who are there for the precise purpose of attending to the wellbeing and welfare of the people of their towns. Therefore, the term used somewhat sarcastically by the noble Earl of "the tender mercies" is, in my opinion, a perfectly true one: they would be tender mercies concerning the people as a whole, and they would take into consideration the individual problems of the people who would require houses in their areas or towns.

But my own interest in this Bill is mainly, I confess, as it affects Scotland. Here we are in a special position. It seems to me that this Bill is a hybrid Bill: part of it deals with the position as it affects England and Wales and does not affect Scotland; part of it deals with the position as it affects Scotland but not England and Wales; and part of it affects the United Kingdom as a whole, in that both areas are concerned. I wonder whether it is the fact that the underlying assumptions upon which, in another place, the Parliamentary Secretary to the Ministry based his case—namely, that there was now an approach to a balance between supply and demand in respect of houses—are true. Are they true for Scotland?

If noble Lords would pardon me, I should like to quote from the most recent White Paper, Cmd. No. 125, headed Industry and Employment in Scotland for Year 1956. It was published only this month. At page 43, under the heading "Housing," this is what one reads: The number of houses completed was 31,501 "— I omit a sentence— Many local authorities outside the industrial belt "— and I emphasise "outside the industrial belt"— have built most of the houses they need at present and slowed down their building. There was no serious shortage of labour or materials. It is interesting to note that of these 31,501 only 4,724 were built by private builders—incidentally, that proportion, which is only 15 per cent. of the total of all the houses built, has always been much lower in Scotland than in England, for reasons which we do not need to enter into to-day. It is almost a characteristic of the relationship between private house building and authority house building in Scotland, and indicates the greater proportion which, as time goes on, local authorities will own as distinct from private owners. In other words, the problem is not quite the same in Scotland as it is in England.

Then the White Paper goes on to say: In February of 1956 a White Paper Slum Clearance, Cmd. 9685, was published, summarising, local authorities' proposals for dealing with unfit houses under the Housing (Repairs and Rents) (Scotland) Act, 1954. The proposals submitted by the end of the year showed that in the three years 1956 to 1958, Scottish local authorities proposed to demolish or close 39,632 unfit houses. My Lords, when you compare the number of new houses being built with the number of old houses being demolished, it must be realised that it will take a long time to arrive even at a balance between the supply of and demand for houses in Scotland.

There is a further point. Those of your Lordships who have read the Second Reading speech of the then Secretary of State on this Bill, on November 22 last, must have been impressed, as I was, by the hesitant, tentative manner in which he put forward the portion of the Bill which refers to Scotland, and I should like to quote one or two parts of that speech. I should first explain that there is no close comparison between the position in England and Wales, on the one hand, and the position in Scotland, on the other, because in Scotland this rent increase is being applied to figures which result from the Housing (Repairs and Rents) (Scotland) Act, 1954, and is not, as in England, based on a conception of gross values.

Since, by general admission, what has happened under that 1954 Act has been a complete failure, and presumably requires some kind of new incentive injected in order to make it work better, the then Secretary of State openly admitted that, so far as Scotland was concerned, this was a temporary measure which would later have to be developed along other lines when the new Rating and Valuation Act, 1956, becomes operative, which will be in 1961. That was the general tenor of his remarks. He explained that this particular part relating to Scotland was being included in this Rent Bill because it had been done in the past, and because, in any case, it was in his view the appropriate thing to do in the present circumstances.

I want to suggest to the noble Lord opposite who will be dealing with the Scottish aspect of this Bill (I think I am right in saying, it has been suggested by a member of the noble Lord's Party in another place) that it is doubtful whether it is really necessary, so far as Scotland is concerned, to proceed with this part of the Bill. What harm would accrue to anyone if the whole of this matter were delayed until 1961, when the Rating and Valuation Act, 1956, will come into operation and when there will be throughout Great Britain sufficient uniformity of conditions to enable the same kind of treatment—if such treatment is necessary? So far as I can see, no one would be the worse off if that were done, and it would certainly make for some partial satisfaction to those who object. For, in case your Lordships do not know, there has been very vocal objection in Scotland to this measure. The noble Lord will be well aware that last week at Ayr, at, I believe, a Conservative Party conference, there was art outcry from some members attending that this particular Act was going to cost a good many votes and was (I believe someone said) a piece of justice for landlords. That may be very true, except that also last week there was a conference of trade union organisations which unanimously objected to this Bill, on the grounds that it would inflict great hardship upon a great many people. I think the noble Lord will also know that there has been some very informative correspondence in the Glasgow Herald showing that people were genuinely concerned about the effect of the Bill on their own particular finances, even though they were not yet certain what would he the effect of the Rating and Valuation Act. For those reasons I would ask the noble Lord to give serious consideration to the suggestion that this part of the Bill be not proceeded with at this stage.

Another thought occurs to me, one which has been mildly touched on by noble Lords opposite, though in a somewhat different sense. No doubt the noble and learned Viscount on the Woolsack will correct me if I am wrong, but I believe that, precisely because the amount of legislation on these matters is becoming so complicated, there is in the operation of these complicated legal provisions an element of harshness which deals differently with landlords as compared with tenants. Unlike the landlords, the tenants have not behind them the benefit of membership of an organisation which seeks to promote their general welfare. On the contrary, these individuals are usually not well-informed, nor well off, and too ignorant of the details of legislation to know what measures to take. And even if they did take measures, it would prove a very expensive course. So there is a disparity of justice between the two sides which ought in some way to be remedied by the adoption of a simpler kind of procedure.

When I have asked myself what kind of procedure might be most desirable in circumstances of that kind, I have wondered—and perhaps noble Lords could answer me—whether some kind of rent tribunal could be devised, composed of men and women untrained in law but with some experience of housing problems, who without much formality, and at little or no expense, could examine the facts brought to them by people anxious to know their position. Would it not be possible to satisfy those people much more satisfactorily than under the present complicated legal procedure and assist them in the problems with which, as a result of increased rent, they will be faced? It seems to me that the hope implied in this Bill, that landlord and tenant will be able to come together and hammer out between them a mutually acceptable rent, is almost an impossibility. Things do not work in that way. In practice—and this is not presuming or contending that all landlords are hardhearted—and in the very nature of trying to bargain on what would be a fair rent for a particular piece of property, it is almost inevitable that a landlord can impose his demand on the tenant; nowadays, particularly, a tenant has very little remedy with which to resist that demand.

Since this is the Second Reading, and as one prefers to deal at this stage with the general aspect of the problem, the more detailed matters can be dealt with on the Committee stage when, probably, noble Lords on this side of the House will try to improve some parts of the present Bill which we feel badly need improvement.

5.29 p.m.

THE MARQUESS OF LOTHIAN

My Lords, I hope your Lordships will forgive a few more words from Scotland. I am afraid, however, that I cannot agree with the pessimism of the noble Lord, Lord Greenhill, on this measure, which I regard not only as extremely practical but as very positive, in that, as I am quite certain, it will lead to an improvement in the housing situation in Scotland, as well as in England and Wales. It is, of course, perfectly true, as the noble Lord has pointed out, that the housing situation and problem in Scotland is different from, and in some senses more difficult than, that in England and Wales. It is also quite true that the full provisions of the Bill do not come into effect for another four years—in 1961. But although the rent increases for controlled houses permitted under the Bill for the intervening period are not great (they are only 25 per cent., which is considerably less than increases which there have been in England and Wales), I feel that they will go some way to making a start in improving the situation. I will not pretend that I think they will go the whole way, because I am afraid that 25 per cent. is not going to make all that much difference. But I feel that if the provisions of this Bill come into force in 1961, and if we can have an assurance from Her Majesty's Government that after that date the two countries will be operating on a uniform basis, then I myself think that the well-known Scottish patience will accept the situation.

I do not intend this afternoon, in view of the fact that there are many other noble Lords wishing to speak, to go into the detailed provisions of the Bill. There is one small point which I should like to raise. According to my knowledge at the moment, all notices of increases in rent: have to be signed by the landlords personally. This entails a waste of money and, what is more important, it takes up a great deal of time, especially when, as is often the case, the landlords—it may be, for instance, several trustees of a property—are living in different parts of this country and often abroad. I was wondering whether some provision could be inserted enabling landlords to hand over this business of signing increase notices to authorised agents, subject, of course, to normal safeguards. I believe this is the practice at the moment under the Valuation and Rating (Scotland) Act. I am quite certain if it was done it would greatly ease the administration of the Bill, which I certainly hope will soon become law.

5.32 p.m.

THE MINISTER OF STATE, SCOTTISH OFFICE (LORD STRATHCLYDE)

My Lords, perhaps it would he for the convenience of your Lordships if I intervened at this stage, I am sure your Lordships all appreciated, as I did, the able way in which the noble Lord, Lord Greenhill, argued his case and the points he put before us. I also thank the noble Marquess for his support. The noble Lord, Lord Greenhill, after a considerable amount of argument, put a direct question to me. He asked whether it was necessary to proceed with this part of the Bill—and I presume he meant the part, which affects Scotland, Clauses 7, 8 and 9. No one would be worse off if this part, he said, were dropped. I put it to him that the one thing we want to do is to preserve our houses, and the houses would certainly be worse off. The noble Lord himself drew attention to that fact when he quoted the number of houses due for demolition during the last year. We have to try to protect this heritage to which we have fallen heir.

I will not deal with the point about the small number of houses built by private enterprise in Scotland. We hope that the obstacle to private building in Scotland has now been removed. We hope that in future the number of houses built there will be more in proportion to those built in England than previously. Might I answer the specific question put to me by the noble Marquess? He asked me whether it would, not be possible for notices of increase to be signed by someone other than the landlords. I am advised that, having regard to the terms of the Housing (Repairs and Rents) (Scotland) Act, 1954, and of this Bill, there is nothing to preclude the owner from serving notice of increase through an agent or factor. I think there is some misunderstanding on that point. That is what I understand to be the position.

My noble friend has explained the Government's reasons for taking this first step towards the abolition of rent control. Those reasons hold good for Scotland, and the decontrol provisions of the Bill apply to Scotland just as to England and Wales. I do not intend, and I am sure your Lordships would not wish me, to repeat what my noble friend said on the subject. I will try to confine myself to a brief explanation of the provisions. The position is that in Scotland all houses of rateable values of between £40 and £90 will be decontrolled. The figure of £40 represents, in the Government's view, a fair limit of control for Scotland, taking into account that matter which worried the noble Lord, Lord Greenhill, the Scottish housing position generally. It also follows the precedent of pre-war years when Scotland and London kept in step one with the other. I cannot give any accurate figure because none is available, but the estimate is that some 60,000 houses will be decontrolled; that is about 8½ per cent. of the total number of controlled houses in Scotland. The other decontrol provisions of the Bill—the decontrol of new tenancies and the provision for decontrol by ministerial order—apply also to Scotland. So likewise do the various provisions designed to ease the transition from control to decontrol and to minimise the possibility of hardship to tenants.

My noble friend explained that the Bill provides for England and Wales a new rent structure based on the new valuations now available in those countries. In Scotland, the existing rent structure of the Rent Acts and of the Housing (Repairs and Rents) (Scotland) Act, 1954, is subject to changes. The Valuation and Rating (Scotland) Act, 1956, as your Lordships will recall, makes major changes in the Scottish rating and valuation systems. In particular it abolishes owners' rates and alters the whole system of valuation. Until 1961, when the new valuations will be available, there is no basis on which a new rent structure for Scotland can be devised. The Scottish rent provisions are therefore of an interim nature, as my right honourable friend, the then Secretary of State, stated during the Second Reading of the Bill in the House of Commons. There are two main provisions, and their essential object, as the noble Lord anticipated, is to make the Housing (Repairs and Rents)(Scotland) Act, 1954, work better than it has done hitherto.

First, the Act of 1954 made provision for a repairs increase of 40 per cent. of the rent recoverable in 1954. The amount of that increase was based on the increase in the cost of repairs that had occurred since 1939. Since the 1954 Act was passed there have been increases in the cost of repairs, and the Bill, therefore, raises the amount in the 1954 Act from 40 per cent. to 50 per cent.; that is, 40 per cent. or 50 per cent. of the 1954 rents. The new increase of 50 per cent. will be subject to exactly the same conditions as laid down for the 40 per cent. in the 1954 Act that is to say, the house must be in good and tenantable repair and not otherwise unfit for human habitation, and the landlord must show that in the twelve months preceding the notice of increase he has spent on repairs not less than 60 per cent. of the 1954 rent. That is commonly referred to as the expenditure test.

Secondly, the Bill introduces a new increase, which I will call the 1957 Act increase. That increase amounts to 25 per cent. of the 1954 rent. It is an alternative to the repairs increase of 50 per cent. under the 1954 Act. This new increase is subject to the house being fit for human habitation and in good and tenantable repair, but it is not subject to the expenditure test. The Government hope that this increase will encourage landlords to keep their houses in good repair and will help those landlords who have either not been able or not needed to spend in any one year the amount which would entitle them to the repairs increase under the 1954 Act. These two rent changes in Scotland are not intended to be other than interim measures awaiting the completion of the comprehensive review of the Scottish rent structure in 1961. Their primary object is to help and encourage landlords to maintain their houses and to prevent further decay of the existing stock of houses in Scotland.

The Bill also makes an adjustment in the disrepair provisions in relation to the rent increase permitted under the 1920 Act. Hitherto, the issue of a certificate of disrepair by the local authority has meant that the landlord lost not only the 1954 repairs increase but also the 40 per cent. increase under the 1920 Act, with the result that his rent went back to what it was in 1914. Now the Government's main object is to see that funds are available at least to maintain existing properties, and they are of the opinion that not only would it be quite unreasonable that rents should be liable to fall back to the level at which they were before the First World War, but that to allow them to do so would completely defeat the object which they have in view.

I said that the rent provisions are of a temporary nature. I really think noble Lords should know what is meant in monetary terms. The maximum increase payable weekly on the highest rented houses remaining in control will be 7s. 8d. a week in the case of the repairs increase (that is, the 50 per cent. increase) and 3s. 10d. a week in the case of the 25 per cent. increase. And these are the maximum amounts.

LORD GREENHILL

Is the noble Lord implying that this money will necessarily be spent on repairing houses?

LORD STRATHCLYDE

No one can be certain. It is certainly the hope that that should be so. And I think that when the Government's intention has been made plain, when it is clear that they intend, step by step, to get rid of rent control altogether, it may well be that this will be an inducement to owners not only to keep their property in repair but even to invest further moneys in their properties with a view to keeping them in a proper condition.

That is so far as the highest rented houses are concerned. For the large majority of houses remaining in control, the amount of the increase will be about 4s. a week in the case of the 50 per cent. increase and 2s. in the case of the 25 per cent. increase. Limited though those provisions are—and I would remind noble Lords that we are attacked in the opposite direction to which they attack us on this measure—we believe they will, nevertheless, represent a useful and, indeed, an absolutely necessary measure to enable our stock of houses to be kept in reasonable repair. I therefore hope that your Lordships will give this Bill a Second Reading.

5.45 p.m.

LORD HYLTON

My Lords, I propose to confine my remarks this afternoon to the South of the Tweed, because I should find it extremely difficult to follow the calculations and figures that have been so ably put before us by the last speaker. South of the Tweed, I believe, these proposals will act fairly, and I think that they ought to be commended to your Lordships' House. I am sorry that on this occasion my noble friend Lord Buck-master is not in his seat, because for many years he took a leading part in your Lordships' House in drawing the attention of the former Government, and the two Labour Governments before that, to the very serious position and distortion that arose from the operation of the Rent Acts. The figures which he laid before your Lordships' House on those occasions have been amply justified by what has happened in the last ten years.

This afternoon we are dealing with about 5¾ million unfurnished houses to let. Under the Government's proposals, about three-quarters of them will become decontrolled (these are figures that were taken, I think, by the noble Lord, Lord Silkin, and also by my noble friend Lord Conesford) and the rents on the remainder will go up to the permitted limit of twice the gross rateable value. In that connection, I believe that it is valuable to examine what the effect of the increase to twice the gross rateable value will be. We have talked about it at some length this afternoon, but the figures themselves have not been mentioned.

The noble Lord, Lord Silkin, expressed grave doubts and anxiety about the effect of basing these increases on the gross rateable value. The facts are these. The weekly increase for one million of these houses (that is the approximate number; the actual number is 963,000) will be up to 5s. a week. I do not believe that, with present wages and present prices, an increase of rent of 5s. a week is going to cause the hardship, the distress and the ill-health to which the noble Lord, Lord Silkin, referred. Then there will be another 954,000 houses the-rents of which will be increased by from 5s. to 7s. 6d. a week. On top of these there are just over one million houses the rents of which may be increased by 7s. 6d. to 10s. a week, and a further three-quarters of a million houses the rents of which may go up by the permitted increase of from 10s. to 15s. a week. And that is only after the safeguard of the disrepair clause has been fulfilled. At any time, if these houses are not in a state of good repair, a disrepair certificate can be applied for and if it is granted, then the rent will drop again to what it had been before, and any excess rent will have to be repaid.

In view of these provisions, I do not believe that the allegations made about the degree of anxiety on the part of the sitting tenant, and the disadvantage to him, can possibly be upheld. When one remembers the enormous sums that every week are spent on pools, betting and drink, surely one must agree that a reasonable level of rent should stand above these non-essential features of modern life. And I believe it is against that background that these increases of rent should be properly measured. I believe that these proposals will commend themselves to the country at large, in preference to the grandiose and universal scheme proposed by the Labour Party, to convert every rent-restricted house into a council house, with all the red tape and officialdom which that would create. It is further to be remembered that the Opposition proposals include not only rent-controlled houses, but whole blocks of buildings, including the shops and commercial premises that may be on the ground floors.

My noble friend Lord Conesford mentioned that if these rent-controlled premises were turned into council houses, without the shadow of a doubt the housing authorities would have to increase the rents. Speeches made by members of the Opposition in another place all agree that if these houses were made into council houses, the rents would have to be increased automatically. And if they were not increased, who would pay the bill? Obviously, the only alternative is another enormous Exchequer subsidy, and then again we should have the ridiculous position we are in to-day, of poor people paying through their rates or taxes subsidies on the houses of those much better off than they are themselves.

I believe that this is now generally recognised throughout the country, whatever scheme comes to fruition, and I believe that it would be a tremendous advantage to the country and to the stock of houses if, as my noble friend Lord Gage said, there could be some attempt at getting what he called a bipartisan approach to our housing problems. Because my noble friend is right when he says that the shadow of the Socialist scheme is now doing great harm, and will continue to do great harm, in diminishing the amount of money spent on improvements and repairs to existing privately owned rent-restricted houses. That is an aspect which I believe your Lordships will deplore, because over the last thirty years—particularly over the last ten years, during which the price of repairs has increased by over 300 per cent.—the effect of the Rent Restrictions Acts has been, and inevitably must be, a great decrease in the amount of money spent on repairs and improvements. Although the Housing Repairs and Rents Act, 1954, has done something to improve the position by making available grants for improvements, it is well known to your Lordships that there are many councils, and councils which have a Socialist majority, who refuse to implement the Act, so that the intention of Parliament is thwarted. I know from my own experience that councils with a majority of members of the Labour Party are most unwilling, and in many cases refuse, to make any grants under that Act. The result is that houses are not improved.

I believe that the proposals in the Bill will begin to provide a sufficient increase of rent to enable many of the old houses, particularly in our picturesque and beautiful stone-built villages, to be properly repaired and improved. Without these increases, these villages are becoming derelict, and they are a national asset which the country cannot do without, forming objects of great beauty which attract people from all over the world. It is just this type of property that has suffered greatly during the last ten years. There is an extraordinary anomaly about the position of these old houses. Under the Town and Country Planning Act, 1947, the noble Lord, Lord Silkin (I am sorry that he is not in his place), invented a great machinery to schedule all houses of national and architectural merit, and under that Act much work has been done. Much of it, however, is fruitless, for the simple economic fact that there has not been sufficient money coming in from the rents of restricted houses to do the necessary repairs to maintain these houses. Therefore, we have the anomaly that one Minister with one hand makes lists to preserve ancient and beautiful houses, and with the other refuses sufficient rent to enable the structures to be repaired. From the simple, common-sense point of view we must put an end to the present position.

There is one aspect of the Bill, mentioned by my noble friend Lord Ridley, which I think will appeal to your Lordships—that is, the multitude of safeguards that it contains. Some of these safeguards are of quite a new description and are greatly to the advantage of the sitting tenants. They are very much to be welcomed. The fifteen months' standstill on uncontrolled houses, unless a three years' lease is agreed during that period, is one safeguard which was inserted in the Bill in another place, after a great deal of argument. A second safeguard is in the prohibition of premiums. There is another to safeguard tenants for the expenditure of money expended by themselves on improvements. There is the old safeguard, in rather another form, protecting the widows and other members of the family of a statutory tenant. These I believe to be real safeguards. Finally, we come to this certificate of disrepair. Although the procedure is complicated and involved, and may take a long time to put into operation, at least it provides a tenant with a safeguard that he has never had before, and I believe that it will be useful and valuable. I commend this Bill to your Lordships for a Second Reading.

6.0 p.m.

LORD WISE

My Lords, at this stage of our debate I do not propose to detain your Lordships for long. Nor do I think it necessary from this side of the House to be led off at a tangent to discuss the Labour Party's policy for housing. There is a time and a place which would be opportune for that. I am rather surprised that certain noble Lords on the opposite side of the House have been somewhat led astray and have lost touch with the Government's Rent Bill by deciding to attack noble Lords sitting on these Benches.

VISCOUNT GAGE

My Lords, as one of those about whom the noble Lord complains, perhaps I may interrupt him for a moment. My remarks about this particular policy, which has been printed and circulated throughout England, were made because, in my judgment, it will have an immediate ill-effect on the administration of the Rent Bill produced by this Government, and on the success of certain parts of it. It seemed to me right, therefore, that it should be drawn in. It was not intended as an attack, but to abstract some information, which I hope we may get at some time during this debate.

LORD WISE

I am pleased to accept what the noble Viscount has said, and I hope there will be another occasion when from this side of the House we can explain our policy in regard to housing. It behoves your Lordships' House to give serious consideration to the terms of this Rent Bill. It is a Bill which, if we are not careful in our deliberations and discussions in Committee, may go forward as an Act of Parliament safeguarding more particularly the interests of the landlord. The noble Lord who has just sat down mentioned one or two points in the Bill with regard to tenants' rights and reliefs; but, in my view, the Bill is almost entirely a landlords' Bill, and for that reason I think it is necessary for your Lordships to consider both points of view.

I should guess that there is no Member of your Lordships' House who will be affected by the Bill as a controlled tenant, It may be that many of us can be assumed to have a vested interest in the Bill as owners of property. If the Bill becomes an Act of Parliament, it will, sooner or later, affect 5 million householders; that is, if the Bill goes on to its logical conclusion of decontrol of all the houses controlled at the present time. As I say, it will affect 5 million householders, and it can be estimated that, with their families, some 25 per cent. of our people will in the long run come under the terms of this Bill. The significance of this must he apparent; and the significance of the fact that we are by this Bill taking steps, so far as rent control is concerned, completely to alter the order of things that has been in existence for forty years, gives vital point to what I said a moment ago with regard to our deliberations on the Bill. There is no doubt that, as the Bill proceeds, certain alterations may be made on the Committee stage. I was pleased to notice certain Amendments made by the Government on the Report stage in another place.

With regard to the Bill, there are one or two points I want to make. The first has reference to Clause 1 and the question of gross value. Once or twice this afternoon noble Lords have slipped into the error of referring to "rateable value ", or what was termed in the last speech, "gross rateable value". The term "gross value" is provided in the Bill. I should prefer that, instead of the calculations being made on gross value, they should be made upon rateable value. Rateable value is a value which is easily understood by everyone; it is commonly referred to; it is used not only for rating purposes but also for Schedule A income tax purposes as net annual value, and is used in ordinary, everyday, business and civil life.

LORD HYLTON

Would the noble Lord agree that you cannot have a net rateable value unless you have a gross rateable value?

LORD WISE

That is not the point. The gross value is already in existence, in the same way as rateable value. My point is that, instead of making our calculations on twice gross value, we should make our calculations on twice rateable value. The use of rateable value, which is a lower value (it is a percentage lower than gross value in the tables which have been published; the difference between gross value and rateable value is usually about 25 per cent.) would have this effect: it would decrease by 25 per cent. the additional rent which tenants will be called upon to pay under this clause. It would make things much easier from the point of view of tenants; and I have no doubt that, for that reason, the Bill might be much more acceptable to controlled and uncontrolled householders as a whole. It would also have the effect of allowing income tax to be paid on the same value. This is important. Since we may now be taking as the maximum rent figure twice the gross value, and the owner is called upon at the moment to pay income tax under Schedule A on a net annual value figure, it may be that the Treasury will lose a considerable amount of money in taxation immediately on the difference in the two values.

THE EARL OF MUNSTER

May I interrupt the noble Lord? I think he is probably getting a little muddled here. The revaluation of houses last year, which put houses on the 1939 valuation, is the rateable valuation. It does not correspond in any way with the Schedule A valuation. That has not yet been altered.

LORD WISE

As a matter of fact, that was my point—that double the gross value will be a much higher figure than the present net annual value; and until the houses are revalued for income tax purposes the owners of property will be paying Schedule A Tax on the net annual value, while receiving a rent of twice the gross value.

THE EARL OF MUNSTER

That is not correct.

LORD WISE

There is another point which may be interesting from the taxation point of view, and that is this. I am advised that, under this Bill, the total increase of rent per annum will be in the nature of £100 million to £110 million, of which a sum of £18 million will fall to be paid over to tenants by the National Assistance Board. The curtailment of the increase by taking rateable value instead of gross value would reduce that amount of £110 million by £28 million, and it would also have the effect of reducing the Exchequer's liability, through the National Assistance Board, by £4½ million, which is a sum well worth saving in these times. I mentioned the question of income tax a moment ago but, of course, it must be borne in mind that many small owners are not subject to Schedule A tax, and if they are then it can be reclaimed.

There is just one point about Clause 10 (3). It is obvious, I think, that once decontrol has started, it will be continued in the next few years. In regard to the present arrangement of decontrolling certain houses under the Bill, I should have preferred that decontrol of those houses, or blocks of houses, should have been carried on over a short period of years rather than at one blow. I hope, therefore, that under Clause 10 (3) (the Minister has said in another place that he does not propose to decontrol any further houses within a year), the future decontrol of the remaining 4 million houses, or whatever the number is, will take place not as one operation but over a number of years. I know that this particular subsection refers to the fact that it may be carried out by areas, but what I am advocating is that it should not be done entirely in one particular year.

There are one or two other points which have arisen in the course of the speeches with which I should have liked to deal—for instance, the changing of tenancies and unoccupied houses. I cannot agree with those noble Lords who have suggested that this particular Bill will create a further supply of houses for people to live in. It seems to me that in no respect can the operation of this Bill provide another house. It may be that people will change houses, but those who come out of one will go into another, and so on and so forth. There may be a "general post" of tenants, but there will not be a greater number of houses for not only the newly married people, who have been referred to this afternoon, but others to occupy. I hope that we shall be able to make certain Amendments on the Committee stage of this Bill, and that when the Bill leaves your Lordships' House we shall find that it is just and fair as between the owner and the tenant.

6.17 p.m.

LORD WOLVERTON

My Lords, in rising to support this most important Bill tonight—because it is a Bill of first magnitude, in that it affects many people—I am sure you will excuse me if I take a few minutes of your Lordships' time. I should like to answer, to the best of my ability, a few of the questions which have been put from the other side of the House. The first point the noble Lord, Lord Wise, raised referred to rateable value. I think I am right in saying that it has always been considered that the gross rateable value bears some relation to an economic rent of the house. These houses are assessed at the 1939 value, so that twice the gross value now is not an economic rent today. Until we get a new valuation, within the next five years, they will not come up to the present level. However, it is getting nearer to an economic rent. Probably two and a half times gross would be nearer, so I think that the noble Lord's suggestion of putting it down to a rateable value would be very unfair to the landlords.

The noble Lord also said that he thought this Bill (I am not myself a landlord, so I can speak quite freely) was mostly a landlords' Bill. But it is mostly a Bill to try to prevent further deterioration of these houses, and to make it more comfortable for the tenants, because they are the people who will get the benefit. We cannot allow this large stock of houses to fall further into disrepair. While I and my noble friends gave support to the Housing Repairs and Rents Act. 1954, some of us were rather critical, and said that it did not go far enough. We were not too popular at the time with our own Front Bench. I think we were proved correct, and that it did not go far enough. As my noble friend Lord Hylton said, it had some good effect, but it did not get many houses repaired. This Bill is a brave measure. It is not a popular one, because putting up people's rents is never popular; but it is necessary to get these houses into proper repair and to give an economic, or near-economic, return to landlords who have had to wait a long time for any increase at all.

The noble Lord, Lord Wise, also said that it would not create any further pool of houses. I am credibly informed that there is at present a large amount of under-occupation of large houses, and that passing this Bill would have the effect, particularly in the outer ring of London, in the Dulwich area, and round there, where there are a large number of biggish Victorian houses which are now under-occupied, of encouraging people to split up those houses—as my noble friends Lord Ridley, Lord Conesford and Lord Gage have said this afternoon—and make them into two or three flats, so that they are occupied to full economic capacity.

LORD SILKIN

Is the noble Lord not aware that the houses he is talking about—and I know them very well for I have lived in one for years—are all decontrolled already? They are above the rateable value. They have not been converted.

LORD WOLVERTON

But there are many, I think, still within the £100 and not out of control. This Bill will have that effect. It will also have the effect that people living in these uncontrolled houses may think it worth their while to spend a little money to make one house into two and find another tenant. I am worried about London. As the noble Viscount, Lord Gage, said this afternoon, it is a very great problem on its own. Throughout the country, with the exception of Birmingham, the Bill should work very well.

The noble Lord, Lord Silkin, said that most people have based their standards of living on the present controlled rents of houses—I hope I have not misquoted him; I took down those words. No doubt they have based their standard of living on the present controlled rents of houses, but I do not see why they should have done so, because many of those rents have not been raised since 1935. I have taken the trouble—and I think it is as well to bring out these points to your Lordships—to ascertain what is happening in a typical rural area where I live, at Newmarket. Newmarket Rural District Council has a very good record of building houses. It is only a rural district council responsible for about 20,000 inhabitants, but between the two wars it built about 700 houses. Since the last war, the council has built about 1,200 houses, so one cannot say that it has not been progressive. Let us look at the typical two-bedroomed house, uncontrolled, built by the local authority in 1938. The rent of that house in 1939 was 4s. 6d. By 1946 the figure had gone up to 6s. 6d. and to-day it stands at 11 s. 9d. That is without rates. The rates have gone up from Is. 10d. to 2s. 4d. and then to 4s. 6d. So that to-day the figure for rent plus rates is about 16s. The noble Lord, Lord Hylton, in his interesting speech, if I correctly understood him, said that under this Bill the rents of about 1 million houses would go up by 5s.; of another million by 7s. 6d.; of another million by 10s. 0d.; and of a further three-quarters of a million by 15s. They are only keeping in step with a rural council in Cambridgeshire. As uncontrolled council houses, these houses of which I speak are very well run. I have not seen any under-nutrition there. The noble Lord, Lord Silkin, said that increasing rents would probably drive more people to need medical help, and so on. I cannot quite "swallow" that one.

This is a fair Bill. It has many protective provisions, which have been ably explained to us this afternoon by the noble Earl, Lord Munster. It is not going to bring any undue hardship. Certainly, the rents are going up to be more economic rents. We shall get those houses kept in proper repair. We cannot afford to allow this large stock of houses to go any further into disrepair—and they are going further into disrepair because, unfortunately, as has been said before, the 1954 Act did not go far enough. That is why I support this Bill and hope it will go through, as I am certain it will. There may be some further modifications to be made to it, but reading the Schedule on repairs, which is important, I think that the tenant is very well protected, because, as the noble Lord knows, the machinery is that no rents can go up for three months. Then, if I understand the Bill properly, the landlord can put the rent up, so that he has a little money in hand to do any repairs, if necessary. If at the end of six weeks the tenant does not think the house has been put in proper repair, he can notify his landlord on a statutory form. If they cannot agree within those six weeks, there is another three weeks in which time a sanitary inspector can be called in and he has three weeks in which to make up his mind whether to issue a certificate of disrepair. There is a period of six months, if he wishes, when the landlord is supposed to do these repairs. If he does not do them, the rent goes back to the tenant. So there are adequate safeguards.

I also like the other provision which is entirely a new provision in British Law; that everybody is entitled to a month's notice. One cannot be turned out at a week's notice. That is a very important new provision. With these few words, I have tried to show that the rent of a typical council house has gone up just as much as, or even more than, the rent of these houses will go up. I cannot see that there is any great hardship on people living in those houses. Why should there be any hardship on people living in these 5 million-odd controlled houses?

6.25 p.m.

LORD MESTON

My Lords, the Government should be congratulated on this Bill, which is a subject pregnant with political dynamite. We should take off our hats to the noble Lords who represent the Government. I want to be quite frank about the housing situation. I do not approach this matter, or indeed any other matter, simply and solely from the point of view of Party politics. There is not a reasonable degree of equality between demand and supply. In other words, at the present time the demand for houses is greater than the supply. The Bill appreciates that fact and has introduced a standstill period of fifteen months which will considerably ease the situation. And, in addition, the decontrol of some 4½ million houses which are at present owner-occupied will increase the availability of housing accommodation. I do not wish to exaggerate in this matter, but I feel that the position ought to be considerably improved at the end of two years; but it would be erroneous if I were to suggest that at the end of two years the position will be entirely satisfactory.

So far as repairs are concerned, the Bill has approached the matter in a most realistic fashion. As your Lordships know, in the past the landlord had to comply with a rigid formula as to expenditure on repairs before he could increase the rent. As many landlords had no money or insufficient money to pay for repairs, the result in many cases was that the repairs were never done and rents were never increased. But the present Bill deals with the matter in a far more sensible way. The landlord may increase the rent up to a certain figure, which varies according to his liability for repairs. The tenant may at any time—I want to emphasise those words, "at any time"—apply for a certificate of disrepair, and this will be the means of compelling landlords to keep their premises in a fit and proper state.

There is one general comment I should like to make on the subject of repairs. Parliament always seems to deal with repairs in connection with some mathematical calculation related to increase of rent. For example, it may be suggested that if a landlord receives another 7s. 6d. a week by way of increase of rent, that will enable him to keep the property in repair. The whole approach to the matter is far too academic. After this Bill becomes law there will still be millions of houses in the country which will be subject to rent control. In many cases an average expenditure of £150 is required forthwith to put the properties into a really sound condition. It may take years to accumulate £150 by saving up money, week by week, out of an increase of rent. I understand that local authorities have powers under the Housing Acts to make loans for these purposes, and it would be interesting to hear from the Government whether those powers are being used and whether they might he usefully extended.

Instead of wandering all over the Bill, I will mention some specific points. Clause 15 provides that the minimum length of a notice to quit must be four weeks. In this connection, if I am not out of order for doing so. I wish to make a personal appeal to the Lord Chancellor, who has tremendous influence in this and, indeed, in every other matter. I would ask him to introduce a new clause or to amend the existing clause so as to confer a power upon the court to amend an erroneous notice to quit. Your Lordships know that if there is any informality or irregularity in a notice to quit, the judge must dismiss the action, and the notice to quit must be, re-drafted and re-served on the tenant; and, as we all know from our experience, two or three months' delay will occur before the case comes into court again.

I appreciate the fact that in the interests of the tenant the notice to quit must he as accurate as possible, because, naturally, he wants to know on what day he must give up possession of the premises. But suppose, for example, the notice to quit ends on a Saturday, whereas in point of fact it should have ended on the following Monday, or it ends on a Monday when it should have ended on the preceding Saturday. It seems to me that, provided always that four weeks' notice has been given, it is an appalling waste of time that a judge should have to dismiss the action and the parties have to start again. Therefore, I suggest to the Government that they should amend Clause 15, or insert another clause to the effect that a judge shall have power in all cases to amend an erroneous notice to quit, subject to such terms as he thinks fit and subject to the justice of the case.

Now let me deal with the definition of "rent" in Clause 22 (3). I know I have a poor mentality, but I have sat up all night with a wet towel round my head trying to understand the meaning of that definition; it is quite beyond me. I should be very glad indeed if the Government could give me a written statement as to what it means. Then let me turn to Clause 4 (1). This is a question of construction. I am not quite clear whether the services in Clause 4 (1) are contractual services alone, or whether they also include non-contractual services. This is a matter of some importance when one has to deal with it in practice. The point about residence protection of persons who are called up for the Services is not clearly stated in the Bill. I believe that if one can decipher paragraph 2 (4) of the Fourth Schedule, one may possibly find that the Bill does not fully apply to persons who are called up for the Forces and are enjoying residence protection. But here, again, my inferior mentality is absolutely unable to understand the draftsmanship of this great work.

So far as premiums are concerned, I am glad to see a prohibition against them. At the same time, there may be loopholes. I am open to correction, but I understand that the prohibition against premium refers to the payment of money, but not to goods in kind. There is a reported case in which a suite of furniture was the consideration for the grant of a new tenancy, and it was held that this did not constitute a premium. I happen to be the landlord of certain controlled property in Aberdeen. I have not made a fortune out of it, and I never expect to—so long as I am not ruined, that is the most. I can hope for in any circumstances. But if at any time your Lordships see me walking about in Scotland with a suite of furniture under my arm and suggest to me that I have been contravening the provisions against premium, you must not be surprised if you get an unparliamentary answer.

My Lords, there are many other observations still to be made upon this excellent Bill. I congratulate the Government upon their great courage in having dealt with this subject at all, and I only hope that in due course the phraseology of the Bill will be explained by experts.

6.35 p.m.

LORD BROUGHSHANE

My Lords, I should wish, even at this late hour, to add my voice to those who have welcomed this Bill and congratulated the Government on bringing forward a measure which, though inevitably unpopular, is clearly in the public interest. Since this Bill was first printed some four or five months ago, hundreds of thousands of words have been printed, written and spoken about it. There has been much discussion and the air has been full of sound and fury: but the sound has been one of protest more than of argument—protest, quite understandably, if not justifiably, made by those who, for the past many years, have enjoyed the benefit of artificially cheap, subsidised rents and who will now face the prospect of paying rents at something nearer the economic level.

I support this Bill principally for what it will do for the two main matters which we have discussed this afternoon—namely, under-accommodation and stopping the older houses from falling into disrepair. As regards under-accommodation, I should like to draw attention to some statistics compiled about a year ago by the Economic Commission for Europe concerning the availability of housing in the various European countries. These figures show that, with the exception of Switzerland and Belgium, the United Kingdom has considerably more housing accommodation than any other European country—indeed, the United Kingdom is about 20 per cent. better off than France, Holland or Sweden, and a great deal better off than all the other countries. The figures show that there are in the United Kingdom thirteen rooms for every ten persons. If these figures are considered in conjunction with the housing census of 1951, which I think indicated that there were 1¼ million households with more than three rooms per person, I would suggest that that shows clearly that we are suffering here as much from a maldistribution of housing accommodation as from any real shortage.

As regards disrepair, the Government White Paper of 1953, estimated that at that time 100,000 old houses each year were falling into disuse. I do not think there is any reason to suppose that the position in 1957 is any better; indeed, it may well be worse, for the price of repairs and maintenance since 1953 has increased by another 10 per cent. and is now at a figure of over 3½ times the 1939 price level. So I support this Bill for what I hope will be its impact both on under-accommodation and on disrepair.

I support it, furthermore, because, at long last, it does something to remedy the injustices from which the owners of rent-restricted property have for so long been suffering. For the past forty years and more, a small section of the community has been called upon to subsidise more than half the actual population of the country—a subsidy which, over the years, must have amounted to many thousands of millions of pounds. Indeed, it might well be said in this context that "never has so much been owed by so many to so few." But human nature is such that creditors are ever maligned by their debtors, and landlords, far from receiving acclaim or even acknowledgment, are reviled. The words "private landlords" are pronounced sneeringly, as though they spelt "public enemy". The exploited are labelled "the exploiters" and truth is turned upside down.

I have before me a pamphlet which recently has been widely and conscientiously distributed to tenants of rent-restricted property in London. This pamphlet states that the Conservative Government have arranged for a present to the landlords which will total nearly £100 million. The only comment I wish to make is that if the effect of this new Bill, as is expected, is to add £100 million to the rent rolls of the landlords, the landlords will still be far from receiving their full economic rents; and the subsidies they will still be providing have been estimated at some £50 million per annum. So much for the "present" which landlords are to receive.

Much has been said about the hardships which this Bill is going to inflict. It would be idle to pretend that it is possible to break down the adhesions of this forty-year-old paralysis without causing some discomfort and inconvenience but is the hardship really going to be so dreadful? As we have been reminded to-day, the National Assistance Board will in many cases pay the required increase, and the amount which is likely to be so paid out is estimated at £18 million, leaving some £80 million to be provided from the private pocket of the community. The community's present annual expenditure on rent and rates is some £830 million, a figure which may be compared with the community's expenditure on alcohol, £860 million, and on tobacco, £880 million. In other words, the Rent Bill is to equate the community's expenditure on rents, very roughly (for it is very little more) with its expenditure, severally, on alcohol and tobacco. In these circumstances it is a little outlandish to claim, as has been claimed by Opposition spokesmen in another place, that this Bill is going to lead to starvation and an increase in the mortality rate.

Time is getting late. May I therefore refer only briefly to a few matters of detail in the Bill itself. Clause 10 in effect decontrols any dwellings vacant at or after the commencement of the Act, and as a result thousands of dwellings have stood empty since last November and will remain empty until after the Bill has been passed, The housing shortage has thus been temporarily, and perhaps unnecessarily, aggravated, Representations were made to the Minister on this point some months ago and it was suggested that this unfortunate situation might be avoided if Clause 10 were redrafted so as to make decontrol operate retrospectively. But the Minister was deaf to entreaty and, so far as I know, dumb as to the reasons for his deafness. I have no doubt that he had good reasons, but it would be interesting if we could know what they were.

Secondly, it would appear that the benefits of Clause 1 of the Bill are denied to owners of requisitioned premises where the requisitioning authority is still the tenant. Could the noble and learned Viscount in his reply say whether this is the intention, and, if so, why it should be so? It further appears that the benefits of the clause are denied to all houses in a clearance area, including those which are fit for human habitation and in good repair. Again I wonder whether we could be told if this is the intention, and, if so, why it should be so.

I should like to support my noble friend Lord Meston with regard to Clause 4, although I would suggest that the solution of the problem which is worrying him is to have in the Bill a definition of the word "services". No definition of that word was included in the 1954 Act and much private and public time and money was spent in arguing what did or did not constitute services. I suggest that it would be in everyone's interest if such a definition could be included. There are other points which I have in mind. Those I have made are possibly more suitable for a later stage of the Bill, and I have indicated them only roughly and briefly.

In conclusion, I would merely say that I consider this a good Bill and perhaps your Lordships can make it a better Bill. May we hope that it will not resemble the last Rent Bill which came to your Lordships' House and which proved to be virtually impervious to amendment. I think the noble Lord, Lord Silkin, will bear me out that that Bill was brought from another place almost as a command, and had it been graven on tablets of stone it could, hardly have been less amenable to amendment. It is to be hoped that the Bill now before your Lordships comes to this House in more malleable form.

6.47 p.m.

LORD LATHAM

My Lords, we are now moving towards the end of a lengthy, comprehensive and revealing debate on this Rent Bill, revealing not only as to its proposals but also as to the attitude of mind and of approach which informs both the Bill and its promoters. The noble Earl, Lord Munster, with his accustomed ability, sought to explain the purposes of this complicated Bill and its Schedules, but somehow he did not seem to be very happy in his work this afternoon. If that is so, I can well understand his misgivings as to the social justice of this measure. In order to buttress his exiguous case he was reduced to praying in aid alleged and, save in one instance, unquoted statements of other persons.

Listening with, I hope, proper attention to what has been said up to the present in support of the Bill, I cannot resist the feeling that the proceedings this afternoon have an air of utter unreality when we reflect on how gaunt and grim are the housing conditions in which vast numbers of our people live to-day—which are very different from the rather Panglossian view which the noble Earl, Lord Munster, seems to accept. I do not propose to address myself very closely to the specific proposals of this Bill, the unsatisfactory character of which has been fully dealt with by previous speakers from this side of your Lordships' House. I propose to invite your Lordships to look at this Bill in the context of the grave housing problem which confronts us, in relation to which the terms of this Bill are footling and in many respects irrelevant.

Our really urgent problem is to provide sufficient decent, hygienic, comfortable dwellings in which worthy homes can be made and enjoyed by our people. A very eminent statesman, happily still with us, said many years ago that the foundations of national welfare are set in the homes of the people. It was Mr. Winston Churchill, now Sir Winston, when he was Home Secretary. It is as true now as it was then. Indeed, in our modern idiom its truth is greater and certainly more imperative. By that token this Bill is a bad Bill, for it will do little or nothing to provide decent homes for the people, and I trust your Lordships' House will not incur the public obloquy of giving it a Second Reading.

The purpose of this Bill is not to provide homes for the people but to increase rents. It will not make any real contribution towards alleviating our lamentable housing shortage. At most it will, under the whip of increased rents and decontrol with the ultimate power of eviction, move some people around within the existing gravely inadeqaute housing accommodation which is available. As regards the decontrol of some 800,000 dwellings, plus 125,000 a year estimated to be decontrolled on vacant possession, it will create a one-sided freedom for landlords in a market which is tragically in short supply. It is idle to suggest that there is a free market in housing at the present time. Welcome as may be the easements as to decontrol which have been introduced under pressure in another place, these will only achieve a lengthening of the period of insecurity for those whose dwellings will be decontrolled.

Thousands of tenants of the dwellings to be decontrolled are already living in mortal anxiety of the increased rents they will be called upon to pay under the pressure of possible eviction. This, I suppose, is yet another expression of the Tory conception of "Setting the people free". There is, unhappily, nothing new about that. This split-mind conception of freedom is all of a piece with the historic conceptions of Toryism—handing a large section of the people over to the savage freedom of being helpless in a housing market in desperately short supply. As my noble friend Lord Silkin said, during the General Election of 1955 the Conservative Party denied that they had any intention of increasing rents. This denial was headed in Daily Notes— Rents: Misleading the People. In the presence of this Bill, how correct was that heading! The people were misled, grossly misled, by the Party representatives of the present Government. Thus this Bill is a sorry breach of faith, without honour and without excuse. It was, in fact, a pretty definite pledge. Unhappily thousands of the electors accepted it and relied upon it. Only now do they realise, with bitter resentment, as recent by-elections clearly demonstrate, that they have been misled and they were, in fact, sold down the river.

I cannot help recalling in this connection that in the discussions as to the reform of your Lordships' House the defenders of the power of delay have based their claim largely upon the right to refer to the electorate proposals for which it was considered the Government of the day had no mandate—the doctrine of "think again", I think it has been called. I have never personally accepted that point of view. But, clearly, the Government had no mandate for this Rent Bill. On the contrary, they have a mandate based on their own assurance not to increase rents: surely an occasion, if ever there was one, when this House should reject this Bill and tell the Government to seek a clear mandate and to seek release from the undertaking given at the time of the General Election on which. inter alia, they were returned to office, Nothing could, I think, better restore this House in the esteem of the people than that it should use its powers to secure that undertakings given should be kept and that good faith shall prevail as an attribute in the government of the people. In short, let us make the Government think again: the electors are already doing so, as is so clearly manifest in the country.

My Lords, I concede that there may well be a claim for fair and reasonable increases of rents where the condition of repair and the amenities provided are of a reasonable standard. But this Bill will result in savage increases for a vast number of disgracefully sub-standard dwellings. This Bill in this respect is monstrously unselective. Dwellings without even the most elementary amenities will attract increases of rent alike with those up to reasonable standards, for the obligation en the landlord is limited to repairs and does not extend to the provision of the amenities which millions of dwellings lack. Nothing is required to be done to those under-provided dwellings. Indeed, in this respect the owners of properties which are up to a fair standard of amenity have a real grievance, for had structural house property is treated in this Bill in the same way as good structural property.

Quite wrongly the Government approach this problem as one of rents, whereas it is a problem of homes for the people, of a social need which must ultimately and in large measure be met as a social service. The growing extent to which local authorities have been compelled, in default of private enterprise and because of its failure in the past, to provide dwellings for the people is proof of the fact that it cannot he left to private enterprise. Already local authorities have built over three million dwellings because it was unprofitable for private enterprise to do so. Then, as always, it is left to public enterprise. Local authorities are required, at great cost, to clear slums which were built by private enterprise and which have been allowed to become slums or near-slums by private enterprise. Without this housing activity by local authorities, which must continue and expand, our economic and social structure could not function.

THE EARL OF MUNSTER

May I interrupt the noble Lord? I trust that in the course of his remarks he will remind your Lordships' House that all local authorities' houses are completely out of the control of the Rent Acts.

LORD LATHAM

I appreciate that; I do not dispute it. But the point the noble Earl has sought to make has no relevance to what I am saying.

I will repeat: without this housing activity by local authorities, which must continue and expand, our economic and social structure could not function; it would break down. Disease and sickness would once again be rampant. As the noble Lord, Lord Kennet, said years ago, when he was Minister of Health, "Slums are radiating centres of disease and sickness". The maintenance of good health among the people is now recognised by all persons as a national obligation and it is so provided for as a social service. But good housing, with proper amenities, is one of the essential bases of good health, of a healthy, vigorous and lively people. It is idle to talk about an "Opportunity State" if half our families are denied the opportunity of good and healthy living accommodation—which is, unhappily, the case to-day. What is true of the declared slums is also true of hundreds of thousands of houses, part, houses and flats, which, although not yet officially represented or declared as unfit, are nevertheless in such bad condition, so lacking in essential amenities or are so overcrowded as to be cruelly destructive of good health. Yet these dwellings, deficient as they are, will attract increases of rent unless they are also in a certifiable state of disrepair.

Let me briefly sketch the shameful picture of how a vast mass of our people are housed in these days—I quote from the Census of 1951. Of the 14½ million households, nearly 7 million had no fixed bath of their own. Over 3 million shared, or were entirely without, a water closet. Nearly 2 million shared, or were without, a kitchen sink. Over one million shared, or were without, a cooking stove.

THE MINISTER OF EDUCATION (VISCOUNT HAILSHAM)

My Lords, I am sorry to interrupt the noble Lord, but if, as he says, these facts are taken from the Census of 1951, he might in candour remind the House that that was after a very long period of Labour Government.

EARL ATTLEE

And after a war.

LORD LATHAM

I suggest that the noble Viscount contains himself in patience. Even in this great capital city of London, one-quarter of the dwellings have no piped water supply. One-sixth of them have no separate kitchen sink. Over one-third of them have no separate water closet. About two-thirds have no separate bathroom. In the presence of these conditions, how a Minister of the Crown can prattle that we are not very far away from the total amount of housing accommodation that the nation needs, I really cannot understand.

LORD CONESFORD

My Lords, the noble Lord does realise, I take it, that the Minister who said that was Mr. Bevan.

LORD LATHAM

No; unhappily for the noble Lord, the Minister who said those words which I have quoted was not Mr. Bevan; it was a former Minister of Housing, Mr. Sandys.

LORD CONESFORD

But he quoted it from Mr. Bevan: I gave the reference.

LORD LATHAM

I have seen the reference. What I have quoted was what was said by Mr. Sandys. The facts I have given constitute a pretty ugly picture, in these days of jet-propulsion and nuclear power, and all the other arts of good living which lie ready to our hands.

There is much talk about under-occupation: that if every family had just the accommodation that its size and needs required—no more, no less—there would be sufficient dwellings to go round. Really, that is no more than a fringe element of the housing problem. If families were Meccano sets and could be uprooted and fitted in as such, it might be possible, by dint of ignoring all personal and human considerations, to add in small degree to the number of housing units available. Proceeding from this assumption, the Bill rests upon the illusory notion that if rents are higher or dwellings decontrolled, then the pressure of such will force people to change their dwellings; and hey presto! every family will be fitted into precisely the accommodation they are assumed to need, and the shortage of decent dwellings will disappear overnight.

In very truth, the problem is not one of under-occupation, but of over- occupation—of serious overcrowding in mostly sub-standard dwellings. That is the real problem. Nothing more quickly turns a dwelling built and equipped for single-family occupation into a slum than its occupation by several families, especially when the house is under-provided with amenities, as hundreds of thousands of them are. When a member of the Government avers that the supply of housing accommodation will more or less match the demand this year, one stands aghast at his immoderation. For the local authority waiting lists of hundreds of thousands of applicants cry out aloud in denial. In truth and in fact this nation is shockingly short of dwellings for the people. Figures which are available, and which I could quote if there were time, are eloquent and bitter testimony to this. The human aspects of this shortage were graphically and poignantly described in the London newspaper, the Star, on March 18 last. It said: This housing problem can best be approached by seeing it in terms of human beings, of young people longing to marry and bring up families, of young couples living with in-laws instead of in separate homes, and of families, cooped up in two rooms because they can find nothing better.

LORD STRATHCLYDE

I wonder if I might interrupt the noble Lord just to say this. In view of the dismal picture which the noble Lord is painting, is he not sincerely grateful to the Governments which have been in power since 1951 for the great improvements they have made over the record of the Socialist Party when it was in office?

VISCOUNT HAILSHAM

That is not written in the manuscript.

LORD LATHAM

Can any person of good will feel other than ashamed that this state of miserable living should exist in these days? The Prime Minister, bent, it seems, on building up an anthology of dusty slogans, has now added to his collection "The vista of hope". I put it to your Lordships, what "vista of hope" can people living in these miserable housing conditions have or cherish? It is for them not a vista of hope but a vista of despair.

Since the First World War, private enterprise has more or less abdicated its function of providing houses for the lower income groups. During those unworthy and accusing years between the wars, the local authorities built 950,000 houses for the working class—all of them to let—

THE EARL OF MUNSTER

At controlled rents?—

LORD LATHAM

Whereas private enterprise built 550,000, of which from 150,000 to 200,000 only were for letting. Since 1945 local authorities have built over two-thirds of the dwellings and private enterprise less than one-third. In the County of London since 1945—and the County of London is not unrepresentative of other large congested cities—the local authorities have built between them no fewer than 126,000 dwellings, all to let. Over the same period, private enterprise built no more than 9,900, very few of which were to let; almost all of them were for sale. What agency is it that is providing the dwelling-houses of the working people of this country?—not private enterprise but public enterprise.

LORD WOLVERTON

My Lords, I am sorry to interrupt the noble Lord, but I think that we are being very patient. There is a Standing Order of the House which says that it is alien to the custom of the House and to the interests and traditional conduct of our business that a speech should be read. The noble Lord has been addressing the House for some considerable time, reading every single word.

LORD LATHAM

My Lords, I appreciate having been singled out from among many speakers this afternoon for mention on how I am to deliver my speech. I repeat, the housing of the largest section of the people has already passed into the realm of a public service; nor can we turn back the process. We can only recognise its inevitability, for reasons which I shall give.

This Bill does not improve or replace the known mass of sub-standard houses. For whatever repairs are required to be done, they do not, and will not, include providing a bath, a separate water closet, a kitchen sink, a cooking stove, or an inside water supply. These conditions, I submit, show that the housing of the working people cannot be left to the fugitive mercy of commercial profitability. Public agencies must step in and do the job. Whatever social and economic advances have taken place in the past fifty years, there are still two nations within our nation, divided now into those who are fortunate enough to enjoy decent accommodation wherein to live in a civilised self-respecting way, and the rest, numbering about half of our families, who are compelled to exist in substandard housing conditions. Living in these sub-standard dwellings seriously impairs the beneficial results otherwise obtainable from the other social services, notably the health service and education. Especially is much of the benefits of the influence of school life vitiated and undone by the bad housing conditions in which a disturbingly large number of our children have to live. It is heartrending to teachers and education authorities to witness, often helplessly and despairingly, how their work in school is undone by the difficulties of home life, largely due to bad and inferior housing accommodation.

Any informed person must admit that, formidable as is the case that can be made against the owners of old housing property, it is the case that in any present or prospective view of building costs, the rents they are receiving are not sufficient to enable the owners to modernise and improve their properties up to an acceptable standard or to replace them. The "carrot" of the grants under the Housing Repairs and Rents Act, 1954, coupled with the right of owners to increase rents by 8 per cent. on the net money they spend, has failed in its purpose. That is admitted on all hands and is conclusive proof that the job cannot be left to them. These sub-standard houses, because nothing is being done to modernise and improve them, are rapidly becoming slums, fit only for demolition and replacement. When that is so, who has the job to do?—the local authorities, at public expense. What is needed is a broad, imaginative, comprehensive policy for the modernisation and improvement of sub-standard dwellings where their habitability would justify the cost, and the replacement of the rest. This clearly cannot be done by private enterprise. Sooner or later it must be done as a public service. For this purpose the local authorities should be empowered, as and when practicable, as part of a worked-out plan, to take over all those sub-standard dwellings which fall within the present category of rent-controlled dwellings, paying a fair (no less and no more) compensation to their existing owners. The local authorities should then proceed, within the limits of labour and materials available, to modernise and improve where the condition and the expected life of the property so justifies and, as to the rest, to do such care-and-maintenance work as would suffice until they can be replaced.

There remains the question of the cost of modernisation and replacement, which has been referred to this afternoon on several occasions, and the question of to what extent that cost should be reflected in the rents charged for the modernised and improved houses. What is the present position? As regards the replacement of slums, the local authorities are bound to provide re-housing accommodation, including overspill, at rents heavily subsidised. They are also bound to do the same as regards the relief of overcrowding. If things are left as they are, these sub-standard dwellings, because of lack of amenities and over-crowding, will become slums, with all the financial liabilities to State and local authorities which that involves.

Even with heavy subsidies, the rents charged by local authorities are, on the whole, higher than those charged by private enterprise for their sub-standard dwellings; but then council tenants are getting value for money, in modern, well-built, well-equipped accommodation, maintained—I repeat, maintained—in good repair. Whereas millions of families are to-day not getting value for money, however low the rents may be; and this will be all the more the case with the higher rents which will be chargeable under the proposals of this Bill. If the local authorities modernise and improve the dwellings which are worth it, replace the others, and give every family a decent, separate dwelling, then I am satisfied that the tenants will be prepared to pay appropriate rents, as a contribution to the cost involved and in return for the better and more comfortable accommodation—not, perhaps, equal to the whole cost, much of which arises from the neglect of the past and which the nation must pay in indemnity for its failure.

Moreover, this public expenditure would pay handsome dividends in the future in the improved health, habits, comfort and happiness of the people, especially of the children. The homes of the people should become worthy of the people. There is perhaps no sphere in which the standard of living of the people could now be more positively raised than in the field of housing. How better could the collective resources of the nation be employed and applied? And sooner or later, it will have to be done, and done by private enterprise—

SEVERAL NOBLE LORDS: Hear, Hear!

LORD LATHAM

—by public enterprise. I thought that slip would not go unobserved. The longer the doing of it is delayed, the more it will cost, not only in human discomfort and unhappiness but also in terms of actual money. For the problem grows with every day that passes. Let no one airily dismiss these proposals that local authorities should take over sub-standard dwellings as being doctrinaire and based upon a rigid, impracticable ideology. I know that the word "ideology" has become a ready term of abuse, especially when no other valid argument exists. But I submit that there will be no alternative to the proposal which I have put forward.

VISCOUNT GAGE

I should like to ask the noble Lord one question, which is not in any way hostile. Is what he is saying in regard to the gradual taking over and modernising of these houses at the discretion of the local authority official Labour Party policy? Because other interpretations have been put on it.

LORD LATHAM

I am at the moment expressing my own views. But what the noble Viscount has said does not differ substantially from them.

I have sought to bring before your Lordships some of the essentials of the real housing problem which presses upon us. In these the aspect of rent must be present, but it is not the paramount aspect. The problem is not of rent, but of human beings: not of housing units, arithmetically and unrealistically assessed, but of men, women and children, their lives and their future. It is the problem of decent homes for all the people. It is also a question of our national self-respect. As I said earlier, it is our social problem number one. I sincerely believe that we cannot escape dealing with it in the way I have adumbrated. If we delay, it will be at our peril. For the people, especially the oncoming generations, will not be content indefinitely to go on living under conditions which are an affront to all canons of human dignity and good living. Nor should they. Why should there be one half of the nation without decent living accomodation?

It is about 112 years since Disraeli's book entitled Sybil or the Two Nations was published. It is a matter for pride and satisfaction that over the years that have since unfolded the social conscience of successive generations has led to the removal of many of those conditions of seething wretchedness, so graphically described by Disraeli in that book. But is it the case that we have removed them all? No, my Lords, not all; not nearly so. For there still survive among us millions of the dwellings which were built round about the time of which Disraeli wrote. In that respect we must confess, with shame, I feel, that there are still "Two Nations" in this island of ours divided by the standards of housing they respectively enjoy. The blot of a vast mass of disgraceful housing is still upon us. It is upon our national honour to remove it to see that all our people are housed under conditions where the sweet qualities of family life can take root and flourish. Until we have done this, the conscience of the nation will remain besmirched, and we shall have failed to do our duty to our fellows. Let us, therefore, reject this Bill and concert together to provide good, dignified homes for all the people.

7.26 p.m.

THE LORD CHANCELLOR (VISCOUNT KILMUIR)

My Lords, I have again had the good fortune of hearing every speech in this most interesting debate, and I feel that I have obtained great advantages therefrom. We have had, in the noble Lord, Lord Silkin, and my noble friend Lord Ridley acknowledged experts on this subject; we have had an exposition of the local authority point of view by my noble friends Lord Gage and Lord Hylton and on the opposite side of the House the noble Lord, Lord Greenwood; and in the speech of a great local authority exponent, the noble Lord, Lord Latham, we have had a remarkable series of statements, with only one or two of which I desire to deal.

I accept at once the challenge of the noble Lord to regard this matter in the context of a grave housing problem. The matter we have got to regard is the distorting and unequal shadow that a large number of Rent Acts, passed at different periods in the last forty-five years, now throw over the, houses of the day. But by all means let us consider the question in the context of our grave housing problem. Since 1945, over 2,500,000 new houses have been built. Of these, 1,500,000 have been built in the last five years under the Conservative Government. Before that period, as many of my noble friends know well, I myself implored the Labour Government in the House of Commons to build more houses; to get away from their miserable annual totals; to get away from the figure of which my noble friend Lord Conesford spoke, when they were admittedly building fewer houses than were falling into obsolescence. At that time, with all the implorings and demands that we made, the Labour Party and the Labour Government ignored the grave housing problem and produced the miserable figures to which reference has been made.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I must say that some protest is required against that statement. If you are going to compare actual figures of houses, you have to keep two things in mind. The first is the task of the Labour Government in 1945, undertaking a bankrupt inheritance, to restore industry, to set right the balance of trade, to increase general production by 70 per cent., to change over industry from war to peace, and, at the same time, to build houses, in the majority for rent and not for sale by private enterprise.

THE LORD CHANCELLOR

The noble Viscount, of course, responds. But that was what we asked. I asked time and again that they should deal with the problem of which the noble Lord, Lord Latham, has spoken, the grave housing problem of our people. We met our constituents; we knew how they were living; and the Labour Government ignored that problem; they left it to us to deal with, and we have improved the position. But we have gone further—

VISCOUNT ALEXANDER OF HILLSBOROUGH

I must say that—

THE LORD CHANCELLOR

The noble Viscount must take it.

VISCOUNT ALEXANDER OF HILLSBOROUGH

So must the Lord Chancellor.

THE LORD CHANCELLOR

We have had a forty minute speech from the noble Lord, Lord Latham, which he made in almost complete silence, and I am going to reply. We have gone beyond that. After dealing with the question of building these houses, and building them in a large proportion to let, we dealt with another problem which the Labour Government had ignored—the problem of slums. The Labour Government record on slum clearance is practically negligible—practically non-existence. We dealt with that subject. We said at the last Election that our target was 200,000 persons rehoused a year, and, as the Prime Minister said at Leicester, we are already more than half way towards our target. It was when we had done that that we came to deal with the problem of the existing houses.

In this debate nobody I have heard—and I have tried to pay the greatest attention to every speech—has denied that, because of artificially low rents, landlords have been unable to keep their dwellings in sound repair. Nobody has denied that the result has been the decay of a national asset which we can ill afford to lose. That is, at any rate, one of the admitted bases. There has been an argument, but not a strong argument, against the proposition that tenants have held on to large accommodation long after their requirements have been modified because they have been paying an artificially low rent. As there has been some argument on that point, I shall try to prove the proposition—and prove it out of the mouths of Labour speakers. There has been no argument against the point made by my noble friend Lord Munster that landlords of rent-controlled dwellings have, because of the Rent Acts, preferred to let furnished or to sell rather than let unfurnished.

There has been no argument against his further proposition that the absence of a pool of houses to let hinders the mobility of labour. I wish to say one or two words about that matter, because it also deals with the paint the noble Lord, Lord Silkin, made as to the question of under-occupation and the effect of this Bill. We believe that the relevant clause, which is largely directed at the present large amount of under-occupation, is essential. A free market is needed to bring into full availability all the accommodation at present under-occupied. We believe that this can be done to some extent by conversions, and also by encouraging landlords to let property which is now held vacant for sale, or property which is going out of use, or which could easily house more than one family. From all the information available, a free market would be the strongest safeguard against tenants being asked to pay excessive rents.

Now I come to the point which was made by several speakers and made in much the strongest terms by the noble Lord, Lord Latham, as to the effect on the general living standards and condition of our people. Let me accept that the effect of the Bill on the cost of living index would not be more than an increase of two points at the outside. That is a matter which can easily be worked out. If I may elaborate a little the point which was made by the last speaker on this side, I think it puts it into proper perspective. The Blue Books on National Income, any of them which one chooses, show that we have been spending a diminishing proportion of our income on rent over the last few years. The 1956 Blue Book gives the total of consumers' expenditure in 1955 as £12,783 million. That is what we, as consumers, spent on everything. Of this sum the item, "Rent rates and water charges" represented £837 million, or 6.55 per cent. For comparison, as my noble friend pointed out, we spent in the same year £859 million on alcoholic drinks and £880 million on tobacco and cigarettes.

That Blue Book shows that this percentage of 6.55 per cent. in 1955 was a serious decline. It had declined pretty steadily since 1946, when it was £548 million or 7.65 per cent. The downward trend is still more marked if we compare 1938 with to-day. Former White Papers on National Income gave a figure of £491 million for expenditure on "Rent, rates and water charges." That was 11.2 per cent. of the 1938 consumption. So that the proportional consumption on rent has gone down to nearly half, and it is a figure which is under the figure for drink and tobacco. And that is the figure of which the noble Lord, Lord Latham, complains, when the proportion of the country's income spent on rent has declined and is now less than that spent on drink or tobacco. I ask the noble Lord to consider again, before he bases his charges on figures which in reality so clearly tell in the opposite direction.

Let us consider it from the point of view of the way people's incomes have risen. Let me take the same two years. Between 1938 and 1955, all personal incomes together rose by 211 per cent., and are now above three times their pre-war level. If, as I have shown, payments for rent have risen much less, two conclusions follow. In the first place, those whose real incomes have kept up with, or gone ahead of, the price rise, are better off because they have to spend less in real terms on rent. In the second place, those who receive rents—often people whose only other source of revenue is fixed incomes, if they have any other source—are worse off because they have to pay higher prices for their needs. That is the position.

And now that the noble Lord, Lord Latham, I do not say attacked, but criticised in a friendly way, my noble friend, Lord Munster, for not having produced his quotations, I will fill up the gap. Nothing would give us greater pleasure. I should like to say this, and I say it in all friendliness: the noble Lord, Lord Silkin, is far too modest about his speech in 1952. If he knew the number of people in this country who have read that speech, or portions of it, since he made it, he would, I am sure, in his modesty, be surprised. But, I should like to assure him, the speech was worth it. I do not want to take anything out of its context so the House will forgive me if I give enough to show that I am quoting fairly. Let me give the first quotation which I like [OFFICIAL REPORT, Vol. 177, col. 1029]: Of course, that is not the whole picture. We have to take into account the large number of people who are being subsidised out of private sources—that is, under the Rent Restrictions Acts. It looks to me as if, before very long, 90 per cent. of the people of this country will be housed at the expense of other people. The noble Lord went on to say [col. 1032]: I realise also—here I impinge on the question which the noble Earl, Lord Winterton, put to me—that there is the problem that not only are large numbers of people being subsidised by private owners of land, but in many cases, though not in all, houses no longer produce a profit to the owner. At existing rents he is even unable to carry out the necessary repairs, and houses are rapidly going into decay. That is the burden of the song which the noble Earl, Lord Munster, and I want to put before your Lordships at the present day.

Now may I deal with the question of under-occupation? I will give authority which I am sure will appeal to the noble Lord, Lord Latham. I cannot think why he did not read it before he committed himself to what he said within the past three-quarters of an hour. My authority, of course, is Mr. Aneurin Bevan. I refer to the speech which he made on the Second Reading of the Housing Repairs and Rents Bill, 1954, on November 30, 1953 [OFFICIAL REPORT, Commons, Vol. 521, col. 826]: Every Minister who has handled this problem knows that, taking the country as a whole, we are not very far away from the amount of total accommodation which the nation requires. I must say that that rather burned in my mind, and occasionally burned in the minds of all my noble friends who were sitting here, when the noble Lord. Lord Latham, castigated us for making the point. What point? The point that Mr. Aneurin Bevan had admitted. It does not stop there. Since Mr. Aneurin Bevan made that statement on November 30, 1953, 1,044,000 further houses have been built, so what would he say now?

But do not let us stop there. Mr. Bevan went on: I could mention areas like Slough and other parts outside London where, because of local circumstances, the total accommodation is still well below what is required, but if we take the country as a whole we find that there is a very great deal of under-occupation. Sanitary inspectors in instance after instance have made house-to-house surveys, and in the middle-sized towns they have found hundreds of houses occupied by only one person apiece. Now listen to this, my Lords: The nation is in grave danger, unless it is careful, of being stupidly extravagant. That is what we are trying to prevent, and the noble Lord, Lord Latham, has expressed views which, if I may put it mildly, are very difficult to reconcile with these pronouncements of so distinguished a member of his Party and the occupant of the position of Minister of Health in charge of housing for years under the noble Earl, Lord Attlee.

LORD LATHAM

If I may say so, they may be pronouncements but they are not pronunciamento.

THE LORD CHANCELLOR

If the noble Lord, Lord Latham, says that any pronouncement of Mr. Aneurin Bevan is not a pronunciamento, I should rather the noble Lord, Lord Latham, said it than I did. I am a brave man but I am not going to plunge into the internecine quarrels of the Party opposite. I will leave that to them.

Let me come to another point. We have had some discussion on housing lists. The point has been made by the noble Lord, Lord Silkin, that there was the evidence of shortage. Again, it was underlined by the noble Lord, Lord Latham. I believe that the answer is that the figures on these lists are no real indication of the relative gravity of the housing situation. They indicate a demand for council houses but not necessarily urgent need. The unreliability of these lists, because of duplication between lists and the lack of revision, has been recognised by Ministers of all Parties. Again, let me give an example because, if I have to try to instruct noble Lords opposite, I like to instruct them with the milk of their own words. Let me again take Mr. Bevan on his point. When Mr. Bevan was pressed in 1950 to publish totals of waiting lists, he said on March 9, 1950 [OFFICIAL REPORT, Commons, Vol. 472, Col. 463]: the information derived gives an erroneous picture of the effective total demand…. But, seriously, the noble Lord, Lord Silkin, put it with perfect frankness and in proper proportion, if he will allow me to say so. He quoted the figure of the London County Council list of 163,000 and said that of these only 55,000 and I use the word "only" merely to make the comparison—were urgent cases. I believe that puts the position in this way: that some proportion—it may be two-thirds or it may be a little more—of people on local authority lists are already housed, but they naturally want better accommodation. That deals with two of the points that have been put up in the course of this debate. Our method of solving the problem, which has to be solved, received much criticism because, of course, our solution leaves the position that nearly 5 million houses—or six out of every seven controlled houses to let—will remain controlled: that is, those with a rateable value of £40 and below in London and Scotland, and £30 elsewhere.

Of course, the big figures of decontrol are those houses that are in owner-occupation and those that will come into owner-occupation. But there is a further slice, as it is usually called, of some 800,000 tenant-occupied houses. I think it was the noble Lords, Lord Wise and Lord Amulree, who expressed doubts whether it was right to have any further decontrol done by Affirmative Resolution rather than by legislation. As my noble friend pointed out, it is to be done by Affirmative Resolution. That means that in another place, and of course here, the Government must find time for it. In the other place that is an important matter, because it has to be done in Government time. But I should have thought—I put this to the noble Lord for his consideration—that on so tender and sensitive a subject as this where an Affirmative Resolution is required, unless the Minister is completely certain of his ground and prepared to answer for it, he will not too readily make a new advance.

The other point that I wanted to make clear is one that has been made by my noble friend Lord Hylton. My noble friend (I do not want to repeat what he has done) examined the safeguards that have been included in this Bill. I should just like to summarise what they are—I can merely state them in a line, and I shall not repeat what my noble friend has said in justifying them. So far as the tenant who is decontrolled is concerned, there is first this safeguard: that he cannot be evicted, nor can the rent be increased, without his consent, for a period of fifteen months. If within that fifteen months he so desires, he can make a new agreement for at least three years, effective at once. Premiums and concealed premiums are illegal under Clauses 12 and 13. Speculation will be stopped. The tenant gets compensation for the improvements he has made. That deals with a tenant who is decontrolled.

For the tenant who continues to be controlled, the first safeguard is that three months' notice must be given of the initial increase, and for six months after that the increase can be only 7s. 6d. a week. The second is that his widow has her right to succeed in the tenancy. Thirdly—I think this is important—for nearly three out of four houses the new rent limits will be less than 20s. a week. Again, my noble friend Lord Hylton most helpfully broke down that three-quarters into increases of 5s. to 7s. 6d. and 7s. 6d. to 10s. The position is that for three out of every four tenants the rent limit will be under £1 a week. Again I ask the noble Lord, Lord Latham, to consider this fact. At the present time, the average industrial wage is £12 a week, and the increases of which we are talking, broken up, as the noble Lord pointed out, will mean for nearly 1 million tenants 5s. or under, and for three out of every four the upper limit will be under 20s. a week. With an average wage of £12 a week, I ask the noble Lord, Lord Latham, really to consider whether, on full reflection, he can justify what he has said to-day. I suggest that it cannot be justified on these figures—which we all welcome and desire in these conditions of full employment—and that that point cannot be made.

I want to detain your Lordships for only a little longer, because, after a great deal of pressure from my noble friends on that side of the House, and put with the greatest friendliness and kindness, we did at last get out of the noble Lord, Lord Latham, a resounding defence of the Labour Party's proposals. I do not agree with the noble Lord, Lord Wise, that on Second Reading you can look only at the Bill. On the Second Reading of a Bill you have to look at the alternatives before the country. One reason for not passing a Bill would be that you preferred the alternative that was still in the political womb of the Party opposite. Let us consider that.

They produced, first, Challenge to Britain in 1953, and now Homes of the Future, as blueprints for the municipalisation of 6 million tenanted rent-controlled houses—that is, houses apart from those actually in owner-occupation. Under this scheme, all these dwellings are to be decontrolled and simultaneously taken over by the local authorities. Again, Mr. Bevan said at the Labour Party Conference at Blackpool on October 2, 1956: It "— meaning municipalisation— will have to come into operation simultaneously on a given date, otherwise it will not start. Now let us consider why. The first point that emerges is that local authorities are to be monopoly landlords; and as monopoly landlords in their several areas they will fix new and higher rents. The council tenant has no security of tenure, nor has his widow. To-day, if he thinks the local authority's rent is unfair he can get a private letting. In the Socialist tomorrow, the tenant who falls out with his housing authority will have nowhere else to turn, except the street, because there is a monopoly landlord. If there was ever any doubt as to the power that local authorities would enjoy under municipalisation with regard to the control of housing, that has been dispelled from my mind by an authoritative statement that was made only a month ago—namely: I live for the day when local authorities will have the opportunity to control the letting of rented property throughout London…we must avoid duplication of the problem by controlling the number of people who come to live in London. That is the future, and as in London, so everywhere else. But of course we have to justify—

LORD LATHAM

May we be told who said that?

THE LORD CHANCELLOR

Yes, certainly—Mr. Mellish, from the Labour Front Bench in another place on March 18. It is not usual to refer to a person by a name unless that person is a member of the Government; that is why I put it in the form I did. But, of course, I have no objection at all to saying it.

We then have to look at the financing of municipalisation. The Labour Party were extremely coy about this. On April 3 Mr: Gaitskell said: There is no financial problem at all. It is absolutely simple. Yet, as I say, the Socialists have been reluctant to explain how their scheme is to be financed. As the News Chronicle put it at the time, the plan "slithers around the arithmetic".

My Lords, so much ridicule was poured on the project that, eventually, Transport House have been forced to lift a corner of this iron or safety curtain (whichever you like to regard it as) in order to tell us something about it. So, in an article in Tribune, Mr. Anthony Greenwood revealed for the first time what the cost of compensation under the Socialist plan was going to be. He said that it would be about £2,500 million. That compares with the Prime Minister's estimate, when he was Minister of Housing, on April 23, 1954, of £3,000 million, so that we have some brackets for this expenditure. Mr. Greenwood wrote: If of course compensation was paid in the form of stock or annuities the Exchequer would have to be responsible for their issue. Mr. Greenwood said the annual sum involved would be only £125 million. So there we have it—the total sum of whatever it may be, the £2,500 million or £3,000 million, and the cost of servicing. And we do not stop there: we still have repairs, maintenance and improvements. If you take it on one figure which has been produced, that would be more than another £2,500 million. Let us say that it is a very large sum. The noble Lord, Lord Silkin, with a courage which I thought only he could have shown, upbraided us for the inflationary effect of the Bill. What would be the inflationary effect of these expenditures—of our releasing that amount of purchasing power in the community? The servicing of it alone would increase taxation by £125 million and put 1s. on to income tax. Rates would go up and there would be a general inflation which might well bring about another Socialist devaluation of the £. That is the finance of the alternative.

Let us consider the administrative machinery. The year 1951 is quite a long time ago, and we have forgotten how the Labour Party loves its bureaucracy. This will remind us. The acquisition and management of 5 million houses would be an enormous task, and it would probably take a long time to come to the point of simultaneous acquisition. In the interim, nothing would happen to the houses. Decay would be accentuated. It would, of course, involve big and costly administrative machinery, for which tenants would have to pay something more in their rents.

I hesitate to speak in the presence of such very distinguished representatives of local government, of great experience, as we have in this House (and here I speak with complete sincerity, and I hope that no one will misunderstand me), but I ask them to consider what would be the effect on local government and politics of having the housing issue as far and away the most important issue bedevilling local government and bedevilling the whole of politics. That is the alternative. I have tried to put it before your Lordships again, as I try to put all my arguments, clothing them in the admirable words used by my political opponents so that out of their own mouths the arguments speak to your Lordships. When one comes to the end of the day I do not think there is much doubt as to making one's choice.

I want now to pass to one or two points which are in the general field. The noble Lord, Lord Silkin, mentioned the question of exchanges. I am informed that my right honourable friend the Minister is sympathetic to a provision facilitating exchanges and will look into that point. Though I cannot make any promises at the moment, I should like the noble Lord to know that that is being considered. The noble Lord, Lord Amulree, raised the question of old people. I would remind him that there is a special subsidy for the building of one-bedroom houses or flats suitable for old people, and this subsidy was retained when the others were altered. The point is in our minds and I am sure the noble Lord will consider what he would like to do at a later stage of the Bill.

The noble Lord, Lord Wise, made a plea for the substitution of rateable value for gross value. My noble friend Lord Munster mentioned the answer to that. It is clear that it would be a most serious alteration in the Bill, and on the technicalities of it I respectfully think the point more suitable for the Committee stage. A number of other noble Lords were good enough to mention a number of points verging on the technical. I hope they will be content if I say that I am most grateful to them for having given notice of these points, and that they will all be carefully considered before the Committee stage. Noble Lords can either put down Amendments then, or we can have a discussion on the Question, That the clause stand part or if there is any one point in which noble Lords are particularly interested, I or one of my noble friends will be very glad to consider the matter. That applies to everyone in every part of the House, for I always like to do that, even with Bills of this kind.

I am sorry to have detained your Lordships so long, but the noble Lord, Lord Latham and I know each other very well and I am sure he knew that when he made that speech he was drinking the joy of battle with his peers and that his approach would be answered.

LORD LATHAM

My Lords, I count it as a success.

THE LORD CHANCELLOR

My Lords, I am grateful to the noble Lord for putting it in that delightful way, but am sure he would have been sorry had he not provoked an answer. All I can say is that I have done my best to answer him.

I want to say only one final word, which has been the keynote of a number of speeches from my noble friends on this occasion. I have said, and I say again, that if this Government were to select a new motto for themselves that motto would be: "Solution, not circumlocution". This problem of the Rent Acts is one which has been accepted for many years as existing, and everyone has said that it is a problem full of dynamite. That does not excuse a Government from failing to try to solve the problem. We are prepared to face its complexities; but what we are not prepared to do is to leave a problem of vital importance, causing a distortion of our free economy and failing to preserve a national asset and to do justice between the persons concerned. We are not prepared to leave that kind of problem undealt with merely because it causes political difficulties. It is in that sense that we ask your Lordships to give this Bill a Second Reading.

8.10 p.m.

VISCOUNT ALEXANDER OF HILLSBOROUGH

My Lords, before the Bill goes to Second Reading, may I say that we shall follow the usual course on Second Readings of not dividing the House. That was the course adopted by Her Majesty's Government in these matters when the Party were in Opposition. I am very grateful to my noble friend Lord Latham for having raised such fine and specific issues, and having evoked the reply which indicates the general attitude of the Government to these matters. We are not at all concerned about these dreadful prognostications of Socialist finance. After all, £125 million would be much less than you have cost the country in the increase in the servicing of your unfunded debt by your general policy in failing to deal with inflation. We will leave these matters until May 15. When you put the Question we shall say "No," but we shall not divide.

On Question, Bill read 2^a; and committed to a Committee of the Whole House.