§ 4.7 p.m.
§ Order of the Day for the Second Reading read.
§ LORD STRATHCLYDE
My Lords, I rise to move the Second Reading of this Bill. It is a Bill of very definite importance to Scotland, and I commend it to your Lordships. The Bill is in two main parts. The first, which gives effect to revised rates of subsidy for new houses built by local authorities, is designed to put housing finance in Scotland on a more rational basis. The second breaks new ground and sets out a code of provisions, chiefly relating to matters of administrative machinery, for dealing with the overspill problem. I shall say something about each of these two parts of the Bill in turn. A subsidiary part of the Bill proposes a number of miscellaneous amendments of the Housing (Scotland) Acts, but I do not think that at this stage I need detain your Lordships with them, although I shall be happy to answer any questions that may be raised.
Your Lordships will remember that the Housing Subsidies Act, 1956, reduced the subsidies payable for houses built by local authorities in England and Wales; and since that Act was passed the general needs subsidy has been abolished, except in the case of one-bedroom houses. The new subsidy provisions contained in Part I of the Bill now before us are framed on a basis which has full regard to the different circumstances in Scotland and the requirements of the housing problem that yet remains, not least the urgent problem of overspill.
The Bill makes provision for a basic subsidy of £24 a house for sixty years. This will be available for all houses built to meet approved needs. By this I mean houses provided to rehouse people living in unfit or overcrowded houses, or to house those who are sharing houses and need homes of their own, and those who 457 need houses on grounds of ill-health or disability. And my right honourable friend the Secretary of State is, of course prepared to consider any other category of genuine housing need that may be put to him by a local authority.
Under the Bill higher rates of subsidy will be payable for special needs, particularly a subsidy of £42 a year for sixty years for houses provided under overspill agreements and of £30 a year for houses provided, under approved arrangements, to meet the urgent needs of incoming industry. There is also a special subsidy for houses in high blocks of flats, calculated on the footing that the Exchequer will carry two-thirds of the additional tender cost over that of ordinary houses. The existing additional subsidies will be continued for houses built by local authorities in remote areas or for the agricultural population.
The new subsidy structure was framed in the light of the facts given in the Report of the Working Party on Housing Subsidies in Scotland, published at the end of July, 1956, the Working Party, consisting of representative officials appointed by my right honourable friend, so far as the Scottish Office was concerned, and by the three local authority associations. In determining the new subsidies, we have been guided by two straightforward principles: first, that subsidies should not be given to those who do not need them: and, secondly, that no one in genuine need of a house should be asked to pay more rent than he can reasonably afford. With these two considerations in mind—and against the background of the facts brought out in the Report of the Working Party, such as that the average rent of a local authority house in Scotland varied between £11 and £18 a year, while the average earner's income was £450—we came to the conclusion that Exchequer subsidies for housing should no longer be related to the cost of building a new house, but that any subsidy received by local authorities in future should be regarded as a further contribution towards the total pool of Exchequer subsidies at their disposal.
The fact is that the large bulk of local authority houses were built when costs were much lower than they are to-day, and the annual charges which the local authorities have to meet on these houses 458 are small in comparison with the annual charges on new houses. On the other hand, there has been a very material rise in wages and earnings, as also in the majority of other sources of income, and it is scarcely reasonable that the tenant of a pre-war local authority house should continue to pay the, comparatively, very low rent that was thought appropriate before the war.
Many local authorities have, in fact, been charging extremely low rents, and balancing their housing accounts at the expense of the ratepayers as a whole by requiring a heavy contribution from the rates. I think it right that I should give to your Lordships some examples in that connection In the county of Lanark, the average local authority rent is £8 15s. 7d. per annum, and the charge the ratepayers have to meet is £25 5s. 7d. In the county of Ayr the rent is £10 1s. 10d., and the charge which the ratepayers have to bear is £24 19s. 0d. In Stirling county the average rent is £8 13s. 10d. and the amount the ratepayers have to find, £35 16s. 10d. Even in the City of Glasgow the rent charged is £15 5s. 0d., as against £21 5s. 0d. which the ratepayers are called upon to contribute towards the economic rent.
Under the Bill local authorities will no longer be required to pay a fixed amount per house from the rates, since the statutory rate contribution is abolished by Clause 5. This means that they will be free to decide for themselves how much of the total of their housing expenditure is to be met by the tenants by way of rent and how much by the ratepayers by way of the housing rate.
The new rates of subsidy are framed on the assumption that the net rents of local authority houses in Scotland will rise over the next few years to an average of £39 a year, or 15s. a week, on all existing houses. This hardly seems unreasonable when one considers that the average level of earnings was £450 per year in 1956, as brought out in the Working Party's Report. And it has to be remembered that there are two or more earners in at least two houses out of five. We are not suggesting for one minute that the individual tenant must pay more rent than he can reasonably afford. What we do say is that there must be some limit to the burden falling on the taxpayer and the ratepayer, and 459 that this can be brought about by a more rational rent policy. There are, of course, families with incomes under the average, but hardship in any individual case can be avoided by a scheme of rent rebates.
I put it to your Lordships that, given a fair rent policy, including provision for rent rebates, the subsidies provided in the Bill will enable most local authorities that are still faced with an urgent housing task to go ahead, at least until 1961, without financial difficulty. We believe that there should be no falling off in the output of houses in these districts, and it remains the Government's policy that the local authorities concerned should press on with their programmes as quickly as possible. It may be that some local authorities will be able to show that they are faced with an urgent housing problem which they are not in a financial position to tackle unaided. In appropriate cases my right honourable friend will be ready to consider asking the Scottish Special Housing Association, within the limits of its annual programme, to come to the aid of these authorities by building a number of houses without any charge on the local rates.
I acknowledge that the provisions of Part I of the Bill have given rise to many protests, but this is to be expected when subsidy reductions are proposed. Many of the protests that have been made failed to fake account of the fact that the local authorities have at their disposal a large pool of Exchequer subsidies on their existing houses built at a time when costs and interest rates were much lower than they are at present. It is our conviction that the new subsidy proposals will put housing finance in Scotland on a sounder and healthier footing.
The main problem now dominating the field of Scottish housing is what has come to be known as "overspill". This is recognised in Part I of the Bill by the provision of a specially favourable rate of housing subsidy. Now I turn to Part II of the Bill. Part II is wholly devoted to the creation of new means for dealing with the problem, which arises principally because, as Glasgow's crowded central areas are cleared and redeveloped with houses up to modern standards, and with reasonable density of population, it will ultimately be necessary to provide homes outside the city boundaries for 300,000 people.
460 The congestion in the City of Glasgow is unparalleled anywhere in this country and, I believe, anywhere in the Western World. There are some 700,000 people living within the three square miles in the centre of the City. The highest densities, where there are up to 700 people per acre over an area of eighteen acres, are generally accompanied by the lowest housing standards, and in the long run the only solution is to clear away the old houses, and the factories with which they are inextricably mixed up, and to build modern houses in their place—which can rarely provide accommodation for anything like the same total number of people; and in any event no reasonable person would desire that it should.
My right honourable friend the Secretary of State has approved the Gorbals redevelopment plan as a first step in this process, and the Corporation have a number of other schemes at various stages of preparation. This is a truly massive task and we wish them success in carrying it out. Altogether, the Corporation have built over 40,000 houses since the war, most of them in large new schemes on the outer fringes of the city. But in about two years or so virtually all the possible housing sites will have been exhausted. Homes will have to be found outside the city not only for the families that, even now, are still without homes of their own, but also for the families who must be displaced by redevelopment. The two new towns of East Kilbride and Cumbernauld will make a substantial contribution. Already, almost 5,000 houses have been built at East Kilbride, and about half of these have been let to Glasgow families. Among the recent tenancies the proportion is higher, and we hope that it will continue to rise. At Cumbernauld building is just about to start—indeed, my right honourable friend is to cut the first sod in the housing scheme at Cumbernauld to-morrow morning. It is intended that 14,000 of the 15,000 houses to be built there should go to Glasgow families.
Another new town to assist Glasgow at the right time is not ruled out, but the Government are convinced that the best way to supplement the efforts of the existing new towns at present is by enabling other local authorities to lend a hand. Part II of the Bill provides the framework necessary to enable fruitful 461 partnerships to be created between Glasgow and other authorities on these lines. The Bill contemplates that an "exporting authority" (that is, an authority with a recognised overspill problem) will arrange for meeting their needs in three ways. One way is for the exporting authority to use the powers they already possess under the Housing Acts to build houses outside their district. The overspill Exchequer housing subsidy of £42 a year would be forthcoming for a development of this kind which was of substantial size and was clearly detached from the built-up district of the exporting authority. But operations of this kind by one authority in the district of another are not easy, and we should be unwise to expect too much to be done in this way.
Another way of meeting overspill requirements is for an exporting authority to enter into an overspill agreement with a receiving authority, under which the receiving authority would undertake to provide a specified number of houses to be let to people coming from the exporting area. The essential features of overspill agreements are dealt with, as your Lordships will see, in Clause 9. The receiving authority must get a payment for each house of at least £14 a year for at least ten years from the exporting authority, and this is in addition to the Exchequer subsidy of £42 a year. The tenants of the houses would have to be acceptable to both the receiving and the exporting authority—to the former, as being likely to fit into the new community in terms of qualifications for the right kind of employment, and in other respects; and to the latter, as being persons whose tenancy of the new houses will contribute to solving the overspill problem. Co-operation between the two authorities will be essential, with a degree of give and take on both sides.
A third method of providing houses for overspill is through the medium of the Scottish Special Housing Association. The Government intend to give a prominent place to overspill needs in determining where the Association should build in carrying out their future programmes. Receiving areas for overspill building by the Association will be selected in the light of the financial situation of the receiving authorities concerned, but it is not intended that the Association should 462 take over the whole job of overspill building in any particular area. It will accordingly be a standard condition that the receiving authority should build a number of overspill houses at least equal to the number provided by the Association. Houses provided by the Association in this way will form a valuable bonus of new rateable valuation to assist the receiving authority in meeting the additional expenditure incurred by them in undertaking overspill development.
While housing is the primary purpose of overspill development, it is by no means the only essential. Where an overspill development comprises any substantial number of houses, whether they are provided by a receiving authority, the exporting authority, the Scottish Special Housing Association or a combination of these agencies, special arrangements may be necessary in advance of buildings for the basic services of water supply and sewerage, and special provision will have to be made in the course of development for the setting aside of land for shops, factories and other places of employment, schools, recreation grounds and other social requirements.
To this end, Clause 10 provides a procedure by way of a town development scheme. This type of scheme, which will be prepared by the receiving authority in consultation with the local planning authority—if that is a different body—and will not become effective until approved by the Secretary of State, has three main purposes. In the first place, it rearranges the powers and duties of the local authorities concerned so as to enable houses, water supply and sewerage services to be provided as efficiently and economically as possible. Secondly, it serves as a blueprint for the whole development, in that it indicates the areas of land proposed for the various kinds of non-housing development which will have to be provided in order to round off the community. But while it will indicate that particular parts of the area are proposed for schools, recreation grounds and so on, it cannot in itself oblige the authority responsible for any of these services to carry out the proposed development. The position of these authorities will continue to be governed by the appropriate existing statutes.
The third purpose of a town development scheme is to provide a means by 463 which Exchequer grant can be made available in respect of certain kinds of expenditure incurred by a receiving authority. The acquisition of land and the installation of main water supply and sewerage services represent the principal services on which the main expenditure is expenditure of a capital nature which has to be incurred in advance of the erection of overspill houses and the receipt of rates from these houses. Accordingly, these are the items which Clause 14 of the Bill selects for the purpose of Exchequer grant.
The basis of grant will be laid down in regulations to be made by the Secretary of State after consultation with the local authority association. The awkward period for a receiving authority is the first few years, when there is little new income in the shape of rates levied on new valuation created in the course of the development. Accordingly, we propose to adjust the grant in such a way that the maximum relief is given at this stage and to do this by drawing up a kind of income and expenditure account year by year for each town development scheme. The intention is that the Exchequer should contribute three-quarters of the resulting deficit year by year leaving the remaining one-quarter to be met by the receiving authority, less any contribution the exporting authority have bound themselves to make under the overspill agreement.
There remains the problem of securing that there is enough employment near at hand for the overspill population. I am sure that your Lordships will agree that this problem is fundamental and that the degree of success we achieve in the whole operation will be in large measure dependent on the attraction of suitable industry to the reception areas. This is not something which can be achieved by legislation, and, although the Bill contains certain important provisions to which I shall refer in a moment, success will depend on the creation of a flexible administrative procedure which will enable full and timely co-operation between the interested Government Departments, the exporting authority, the receiving authorities and the interested industrial firms.
The Bill helps in three ways. The first is Clause 17, which relates to an exporting authority who have incurred an 464 obligation in connection with the rehousing of industry displaced in the course of redevelopment. This clause will enable the exporting authority to discharge that obligation by arranging for the displaced industry to be offered facilities within or near the general neighbourhood of an overspill development. Then as regards the provision of industrial sites, any receiving authority—including a small burgh—operating a town development scheme will have power to acquire and develop land for industry. Any charges falling upon the receiving authority from expenditure which they incur on the acquisition and the preliminary development of industrial sites will be one of the elements attracting grant under Clause 14.
Then, Clause 25 enables the receiving authority to construct factory premises for letting or sale in all suitable cases, and not, as at present, only outside the scheduled Development Areas. The important thing to remember here is that the overspill process will be closely linked with the redevelopment carried out in the City of Glasgow. We believe that priority of consideration in the dispersal of industry should be given to those industrial firms whose premises will be displaced by redevelopment, and who will in any case have to secure new sites and new buildings. Such firms will receive compensation for the loss of their existing premises, which will, in practice, represent the present market value of these premises plus compensation for disturbance.
While one must be cautious about generalisations in matters of this kind, the conclusion reached after careful interdepartmental study and consultation with the Inland Revenue Valuation Department is that the compensation payable for displacement will, in a considerable proportion of cases, go a long way to provide the funds needed for re-establishment. Not all of the displaced firms can operate successfully at a distance from the heavy industries established on Clydeside, but we believe that a sufficient number could do so.
There will be attractions in moving to areas where good living conditions are being provided for workers formerly living in Glasgow; and to assist this process the Government have authorised the Corporation to spend £250,000 a year on the 465 advance purchase of industrial premises which will be affected by redevelopment, where the firms concerned are proposing to move to an overspill reception area or a new town. The Corporation will get an Exchequer grant of 50 per cent. on the annual deficit arising from loan charges on this expenditure under the existing Planning Acts. As redevelopment goes ahead in Glasgow there will be a steady flow of acquisition of industrial premises. Already since the £250,000 offer was made in February two of the largest firms in the Gorbals area, employing together over 600 workers, have asked the Corporation to purchase their premises now in order to allow them to get ahead with their plans for resettlement.
The procedure we envisage is that, on being approached by such firms, the Corporation will arrange discussions with them and with the Scottish Controller of the Board of Trade. The Controller will have at his disposal all the information about sites, services and factory building costs in the new towns and the other receiving areas where overspill housing is being planned. He will be able to recommend the firms to any one or other of the areas and to discuss their requirements with the New Town Development Corporation or the receiving authority concerned.
When the firm has selected an area or a site it will either itself build with the compensation it gets for its old premises or with other capital procured from private sources, or it may ask the New Town Development Corporation or local receiving authority to help. The help which the Development Corporation or receiving authority can give may range from the offer of a factory site to the actual construction of the factory either for leasing to the firm or for disposal on amortisation terms.
The Board of Trade are prepared to arrange for Scottish Industrial Estates Limited to put their knowledge and experience at the service of receiving authorities contemplating the promotion of industrial development as part of their contribution to the relief of Glasgow's overspill. This arrangement should be of particular value to the smaller authorities who may feel the need for a guide, philosopher and friend in their initial ventures into what will be for most of 466 them an entirely new field. The part which Scottish Industrial Estates will be able to play in any particular case will depend on the scale and character of the industrial development required as well as on the circumstances of the receiving authority, and any outlay incurred by Scottish Industrial Estates will be defrayed by the authority. The main task of Scottish Industrial Estates will, of course, still be to cater for new industries coming into the Scottish Development Area to relieve unemployment, and this must remain their primary and pre-dominant function.
We cannot hope to solve the overspill problem in one generation, and its solution cannot be secured by the Secretary of State alone or by the exporting authority or by the receiving authorities. Full and frank co-operation on all sides will be needed. The present Bill makes such co-operation practicable, and I, personally, am confident that with a continuation on all sides of the good will which has already been shown, conditions will soon be created in which steady progress can be made. Anyone who is as closely associated with the City of Glasgow as myself must feel strongly as to the need for the Bill and the importance of making it work, and it is with all sincerity that I commend it to your Lordships. I beg to move that the Bill be now read a second time.
§ Moved, That the Bill be now read 2ª.—(Lord Strathclyde.)
§ 4.38 p.m.
§ LORD MATHERS
My Lords, when the noble Lord opposite brings a Bill before this House he always makes a clear exposition of its terms. I think I can say on behalf of all of us that he has excelled himself to-day in the way in which he has presented this Bill. There are difficulties about it, but certainly he has explained clearly what the Bill is intended to carry into effect.
The Bill is complicated and, as we saw from the discussions in another place, it seems to be admitted to be experimental. Indeed, I think that could be read into part of what the noble Lord said in the speech that he has just delivered. This Bill was the subject of keen debate in another place and there was some uncertainty, even on the part of Government supporters, about its provisions. I believe that there is justification for the 467 feeling of some doubt about how the arrangements, financial and otherwise, embodied in the Bill will work out in practice. Part I of the Bill makes drastic changes in the rates of Exchequer subsidies to local authorities payable after August 1 of this year. No doubt there is justification for examining the subsidy position, but to do justice and, at the same time, prevent hardship upon individuals would require practically an individual means test, a principle which would be repugnant to Her Majesty's Government and local authorities alike.
Whatever different local authorities may think of the provisions as set out in the Bill, and as they have no doubt been explained to representatives by Government spokesmen, I feel that there must arise differences of opinion in the working out of the arrangements as between authority and authority. The case of the City of Glasgow seems particularly odd. Under the overspill arrangements, that great industrial capital of Scotland is to lose ratepayers and industry in the working out of the Government's plans, yet Glasgow is called upon to pay £14 per house to each authority to which her citizens are transferred as industrial workers. This comes at a time when Glasgow is still struggling to meet her continuing need for houses—a need which not only continues but, I understand, even increases. But I should not be talking about Glasgow: that I should leave to my noble friend Lord Greenhill, who has so much more knowledge and experience of that great City.
It appears that the Bill is not designed to help in non-development areas. Surely some arrangement of that kind should be made as a matter of course for the development of industry in areas to which overspill population is to be transferred. I believe that experience will prove the wisdom of what has been urged by my right honourable and honourable friends in another place in this regard and that Her Majesty's Government may have cause to regret their failure to accept some of the advice proffered to Ministers. As I read this Bill, there is a kind of artificial atmosphere about it. It is not as if the conditions of its application are already to any extent in existence. Fresh conditions are apparently to be created 468 and then dealt with. How else can we describe the intention to provide factories which it is hoped will be taken up by industrialists who will require workers to be transferred from the old city areas to new districts where it is hoped work will become available? Many personal problems will arise in such transfers. It will require skilful planning to coordinate the work and the supply of workers, and I do not envy Her Majesty's Government their task in achieving this desirable end.
It has been clearly demonstrated that Her Majesty's Government are determined to pursue the course mapped out by the Bill and it would be churlish of me to predict failure. Certainly I have no wish to do so, for I believe that some good may come out of the Bill and I desire every ounce of that possibility to be secured. In any case, the responsibility is that of Her Majesty's Government and they are entitled to reap any reward the Bill may bring. On the other hand, in the event of the Bill proving unpopular, as well it may, who am I to worry about the fate that is in store for Her Majesty's Government when next they face the electorate? Believing opposition to be futile, I shall not impede the passage of the Bill in any way. It will receive a Second Reading and will become an Act of Parliament. We shall watch with interest to see how it works out in practice.
§ 4.45 p.m.
§ THE EARL OF DUNDEE
My Lords, I am grateful to the noble Lord, the Minister of State, for his clear explanation of this Bill, whose progress in another place has, no doubt, been followed by most of your Lordships. The Bill is really three separate Bills, two of which are of major importance to Scotland, combined into one measure, but it has already been very exhaustively discussed by Scottish Members of another place, who seem to have pretty well exhausted themselves as well as the Bill in doing so, and I do not think it is necessary to add much to what has been said there.
The first part of the Bill deals with subsidies and consequently with rents, and this has given rise to a violent controversy in another place and in the country, but I propose to say nothing on that subject except this: all our Scottish 469 housing legislation for the last forty years has resulted in anomalies of such extraordinary dimensions that they probably had to be straightened out sooner or later. One can go on disputing indefinitely how much of the cost of these subsidised municipal houses ought to be borne by the occupiers, how much by the occupiers of other houses, some of which may be under-rented and some fully rented, and how much by the housing pool which every local authority ought to have.
It is easy to find numerous examples of families earning very large incomes living in the most modern type of council house, paying an absurdly uneconomic rent, at the expense of other people who are earning very much less; and it is no doubt possible to find examples on the other side. But whoever may have to pay a bit more and whoever may have to pay a bit less, I do not think Part I of this Bill will have any adverse effect on housing progress in Scotland or on our endeavours to abolish slums and overcrowding; and it is upon that subject that I should like to say one or two words.
I think that the housing record in Scotland of the present Government is a good record. From the end of 1951 to the end of 1956 we have built 187,000 houses in Scotland. That is an average of about 38,000 a year, which is exactly double the average for the previous six years, from the end of the war until 1951, when the annual average was only 19,000; and it is 50 per cent. higher than the record which we achieved before the war, in 1938. In some parts of Scotland, though not in all parts, we are almost in sight of the time when there will be no more slums and no serious overcrowding. But we are not in sight of that goal—indeed, we are nowhere near it—in the City of Glasgow, and it is the special problem of Glasgow which Part II of this Bill is primarily intended to meet. The pre-war housing record of the Glasgow Town Council was utterly lamentable. In order to get rid of their slums and overcrowding in twenty years, the Glasgow Town Council would have needed, in the 1930s, to build at the rate of 10,000 houses a year; and had they built on the same scale as the most progressive housing authorities in Scotland in proportion to their population and rateable value, they would have built more than that. But the peak figure, 470 which they reached in 1934, was only 4,000; and after 1934, when all other Scottish local authorities were increasing their programmes, Glasgow's figure fell to something between 2,000 and 3,000—an absolutely miserable figure which was hardly enough even for normal replacement, so that no real progress at all was made.
During the war no building, of course, was possible. After the war, Glasgow was faced with an astronomical deficiency in housing, and now, on the Second Reading of this Bill in another place, the Secretary of State for Scotland stated that he hoped Glasgow's present output of 5,000 houses a year would not be reduced. By this time, I should have thought that 5,000 houses was a good deal less than half what Glasgow ought to be building in order to keep pace with the rest of Scotland. But the problem is not only one of numbers, it is also one of space, and we are told in this Bill that there will soon be no more room for any more new houses in Glasgow and that 300,000 inhabitants of Glasgow are unable to be rehoused within the city at all, so that they will have to become emigrants. They are now officially described as "an overspill".
I hope that this estimate of 300,000 is not too low, but, having been concerned in one way or another with the Scottish housing problem for about twenty-seven years, I feel bound to say that I have never yet heard any official statement of the housing requirements in Scotland which did not prove to have greatly underestimated the true dimensions of the problem. However, let us take this official figure of 300,000 people who have to emigrate, who have to get themselves "spilt" out of Glasgow. How long is it going to take to do it? The new town of East Kilbride was started after the war in order to receive surplus population of Glasgow. Five thousand houses have been built there. Until this afternoon, my information was that only 1,500 of those had been occupied by families from Glasgow. But my noble friend Lord Strathclyde, in his speech just now, told us that half of them had been occupied by Glasgow emigrants. That would be 2,500, which is a little better, but, of course, not much out of 300,000.
I am sure that many of the receiving authorities will do their best to help. I 471 was particularly glad to hear my noble friend say that half the houses would be built by the Scottish Special Housing Association, a most excellent body in the establishment of which Mr. Walter Elliot and the late Lord Clydesmuir played prominent parts. It is a body which has done fine work, but which has never been used by Scottish local authorities to anything like the extent to which it ought to have been used. But these receiving authorities have their own problems, and I am afraid they will not be keen to be "spilt on" to a really uncomfortable extent. I can hardly see as many as 300,000 people being received within a reasonable period of time.
There is also the question of moving the industries on which these people now depend for their livelihood. How long is all that going to take? I have nothing whatever to say against the provisions of Part II of the Bill; I entirely support them, and I hope that they will be applied very successfully. But it seems to me that we shall be fairly lucky if the Bill, as it stands now in Part II, succeeds in solving 20 per cent. of the problem within the next twenty years. We can, if we choose, resign ourselves to the perpetuation in Glasgow of some of the worst slums in Europe for the rest of our own lives. But if we do not choose to resign ourselves to this prospect, and if Glasgow cannot any longer expand outwards, the only alternative is that Glasgow should expand upwards in order to rehouse not, of course, the whole but at least some of these 300,000 people.
I am not a particular admirer of skyscrapers though they can be very imposing buildings. I should not, I think, particularly like to live in a skyscraper myself, though I do know a good many people who like living in them. But it is not a question between skyscrapers and cottages; I think it is a question between skyscrapers and slums. To live in a flat in the twentieth storey of some megalithic block of residential apartments may not be entirely in accord with all our conceptions of ideal family life, but surely it is better than living in a leaky and worm-eaten single room with a growing family of children, and with a mother-in-law as well, sharing a common lavatory with twenty or thirty other people at the head of the common stair. Surely it is better to live in a skyscraper than to live like 472 that. And these conditions are going to continue for the rest of our lives unless something more is done than is contemplated at the present time. I know very well that the building of very large residential blocks of great altitude is extremely expensive. But is it not also going to be very expensive to scrap all the industries on which these 300,000 people depend and rebuild them again fifty or a hundred miles further away?
In the proceedings on this Bill in the other place, a week or two ago, the Secretary of State announced (I think my noble friend referred to it again just now) that authority had been given to Glasgow to spend £250,000 to acquire and demolish two small factories which employed 600 people. I suppose that 600 employed persons might represent a total population of about 1,000 persons including children. If it is going to cost £250,000 to destroy the livelihood of 1,000 people before it is reconstructed elsewhere, it will then cost £75 million to destroy the livelihood of 300,000 people before that livelihood is reconstructed elsewhere, and the reconstruction, of course, is going to cost a lot more. Would it not be better to spend some of this money on rehousing not all of these people but as many as you can where they are now, and not destroying the industries, which was done in Vienna before the war and has also been done in New York?
Clause 3 of this Bill provides that:In respect of any approved house which is a flat contained in a block of flats the major part of which, as determined by the Secretary of Slate, is of six or more storeys…the Secretary of State may give an additional grant consisting of two thirds of the additional cost over the normal cost of an ordinary house. I think that that is a very good provision, but I doubt if it is good enough to induce an authority like the Glasgow Town Council to go in for a really bold and imaginative policy of building the type of residential blocks of enormous size which are really required to meet this problem. And I wonder what the effect on our national finances would be if we were to give the whole of the additional cost instead of only two-thirds, and try to induce the Glasgow Town Council to go in for a really bold and imaginative policy in high building. I would not suggest that this should be done all over Scotland. Indeed, I do not think the question would arise 473 in any other part of Scotland. But Part II of the Bill is especially designed to give special financial assistance to the special problem of Glasgow housing. It seems to me that in the long run this would not cost any more than the long and painful process of negotiating with all the receiving authorities and scrapping and removing all these numerous industries from one place to another.
In any political discussion on the housing problem it is usual for everybody to try to put the blame for the present state of affairs on to somebody else. I am not particularly interested in blaming anybody for the present state of affairs, which is constantly done in another place and at political meetings, although I think that if anybody is to be blamed, the miserable housing record for the Glasgow Town Council for the last twenty-five years certainly cannot escape criticism. However that may be, the fact is now that Glasgow is the lame duck which we have all to try to help. We cannot be content to solve our problem everywhere else and to leave it unsolved in Glasgow. I would not have made the suggestion which I have made if this Bill did not propose special measures of financial assistance to deal with the Glasgow housing problem which I think would be equally expensive and which I think would take far too long. My noble friend spoke about not doing it in one generation; but are we going to be content with that? In spite of the progress which has been made, the last generation did not solve the Scottish housing problem. It must be solved in this generation. We cannot leave it to be solved by our grandchildren.
§ 5.2 p.m.
§ LORD POLWARTH
My Lords, other noble Lords have dealt with aspects of the Bill which concern housing and housing subsidies, but I think that it would be wrong if no Member of the House were to say something about its impact on industry in Scotland. First, we must all welcome any effort to deal with this appalling problem, of which a number of your Lordships are so well aware and of which we have heard to-day. Of course this is first a housing Bill—it abounds in jargon, such as "overspill", "exporting authorities", "receiving authorities", and so forth. But do not let this blind us to the fact that we are 474 not dealing simply with the problem of housing; we are dealing with an immense human problem.
As the noble Lord, Lord Strathclyde, has told us, the Bill envisages the removal of some 300,000 people from the centre of Glasgow—that is, one-fifth of the population of Glasgow and 6 per cent. of the whole population of Scotland. It does not affect only them: it affects their homes; it affects their jobs and their family relationships. That is the measure of the importance and also the complexity of the problem with which the Bill sets out to deal. In fact it is nothing less than a major surgical operation that is proposed on the heart of the Scottish industrial economy. It is no use thinking only of providing so many cubic feet of housing accommodation, and so many square feet of garden, in new areas. We have to consider the economic consequences of what is proposed in the Bill. It reflects on the industry and commerce on which all these people depend for their jobs. It was Adam Smith who said thatMan is a difficult baggage to transport.That remark has been borne out time and again when efforts have been made to secure major movements of population and industry.
Industry is an even less transportable baggage. This Bill makes provision for the transport of industry, but I wonder if those responsible for drawing it up realised the difficulties involved. In the Glasgow area, industry is remarkably varied. It has a variety that is the result not of chance but of logical development over decades—indeed, over centuries. Your Lordships will have read this morning of the placing of orders for £80 million worth of tankers. Over one-third of these ships are to be built on the Clyde. That does not involve only shipbuilders; it involves steelmakers, makers of machinery, pipes, valves, wires, furnishings, and all manner of things. In fact, this is a vast interwoven industrial complex and the movement of many of the individual firms out of this area may be difficult, or even impossible. Some of the industries are easily moved, but there are those that have been more recently attracted—the lighter industries, which it is highly desirable to have in order to diversify the economy. It is not these industries that we wish to move.
475 The noble Lord, Lord Strathclyde spoke of the consultations that had taken place between various Government Departments on the adequacy of compensation and the effect it will have on the movement of industry. I think that we ought to know more about the nature of these consultations and the results obtained from them, because it seems to me that this is the key point in the whole question of the movement of industry. I think that it will not be just a question of consulting industry as a whole, chambers of commerce and bodies such as that, but a question of most detailed survey of many individual firms and companies. Unless that survey is completed and made available for general study, we may well go off in the wrong direction at the start.
The alternative to moving industry out into the areas to which the population is going to be moved is to try to attract new industry to establish itself in these new areas of population. To some extent that is highly desirable, but if we do this we run the risk of starving the industries that remain behind in the congested area of their labour force. There is a third possibility—that of finding employment for the population that has been moved to travel back daily to work in the city. Those who are familiar with the position in London will agree, I am sure, that the less this occurs the better. I believe that, somehow, the solution to the problem of finding employment for people moved out is to be found in a combination of these three methods. Undoubtedly some people will travel back to the city—they will have to. Clearly, new industries must be attracted to these new areas, and certainly selected established industries must be encouraged to move out. This process must be not a brutal, uprooting of them from their surroundings and connections, but a delicate transplanting. Putting it bluntly, people have to be moved. If, on the one hand, we move people and find that we cannot move industry, we shall find dreadful complications. If, on the other hand, we move people and force industry to move, we run into other equally dreadful complications.
In whatever way industry is to be provided, one of the major factors will be the availability of factories. The success of the policy of the development areas is proof of the truth of this—in particular, 476 the work of Scottish Industrial Estates in providing factories since the war. I am glad to hear that the experience of this body is to be made available to local authorities: they will find it of the greatest use.
We see provision in the Bill for compensation for factories moved. Of course there are the existing powers of local planning authorities to build factories, but in the past these powers have been used sparingly, and mostly to build small factories. I am glad, therefore, to see these additional powers to local authorities who are not planning authorities to build factories and to such authorities inside development areas, as well as those outside.
I do not believe that these powers alone are going to achieve the desired result. Recently my noble friend Lord Bilsland drew attention in this House to the Government's distribution of industry policy—or, as I am afraid some of us felt, perhaps, their lack of policy. I think we felt that the good work done under the Distribution of Industry Act was coming to a standstill through the virtual cessation of the provision of new factories under that Act. I am not going to revert to that subject to-day, except to say that an active and enlightened distribution of industry policy is an essential complement to this Bill, both in order to reverse these intolerable conditions which have arisen over the past years in Glasgow, and also to ensure that never again is a future generation faced with such a problem as that with which we are faced to-day.
I congratulate Her Majesty's Government on their courage in facing up to the facts, so far as they do in this Bill. I am glad they realise that the solution of the trouble does not lie simply in the provisions of the Bill. It lies, as the noble Lord, Lord Strathclyde, has said, in the active and energetic co-operation of all concerned—of individual companies and firms in industry, chambers of commerce and trade unions. It lies, particularly, at the door of the Corporation of Glasgow and the local authorities in the receiving areas, to get together and make the Bill work. Local authorities in Scotland, as indeed, I think, elsewhere, are particularly jealous of their own rights—and rightly so; but there will have to be much give and take. Above all, as I see it, this 477 stands or falls on the policy of the Government for the distribution of industry. Let us earnestly hope that the co-operation of all parties will be forthcoming, for without it this part of the measure will be an empty shell.
§ 5.12 p.m.
My Lords, I propose to confine my remarks to the rather smaller provisions of this Bill. I am not an expert on the housing problems of Glasgow, but I feel it should be recognised that, although the housing needs of Glasgow are a major item, there are other districts in Scotland which also have housing problems; and this Bill covers those needs and makes certain provisions for them. Part I of the Bill I consider a courageous and realistic approach to a very difficult problem, and I should like to add my congratulations to Her Majesty's Government on that score.
In the Explanatory Memorandum to the Bill one of the purposes set out is to amend certain provisions of the Housing Acts; and Part III makes a number of miscellaneous amendments to the Housing (Scotland) Act, 1950. Among these amendments is the First Schedule of Part II, and it seems to me to make a somewhat half-hearted attempt to "get after" the local authorities who have been laggardly or backward in applying the provisions of the 1950 Act as regards repairs and improvements. The position, however, seems to me to require a little elucidation. I have not warned the noble Lord who is to reply that I was going to ask this question, and I can hardly expect an answer to-day, although he may be able to give one. It has been frequently stated that in these matters, persuasion is far better than compulsion, and with that I entirely agree.
I am informed (although it may be wrong) that the Department of Health in Scotland are not intervening when a grant is reduced, or is not given on the full scale, because they have no powers or no official knowledge of the fact. If that is so, and if that state of affairs is to be continued, I should like to know how the noble Lord intends to persuade local authorities that everybody's interest is better met by a more liberal interpretation of the Government's requirements. On those lines, I would suggest that 478 merely causing the local authority to supply to the applicant in writing reasons why a grant has been refused, or cut down, is not much use, unless a copy of that information is sent to the Secretary of State; and at the moment the amendment does not provide for that. Possibly that may not be the way to do it, but I feel that a little explanation might be useful on that point.
Just to draw your Lordships' attention to the fact that this Bill is not all persuasive, Clause 16 (2) provides a means whereby Her Majesty's Government can enforce their will in the overspill agreements, and such like, by various arrangements. So that obviously they contemplate putting their advice over. That being so, I rather feel that there is no reason why that should not also apply in these other cases. Various Amendments have been moved many times before. I think in this case they have now been met, to a certain extent, although not, in my view, sufficiently.
The other point I wish to speak upon for a short time is the payment of improvement grants and of voluntary alienation or sale. As I am informed, in Scotland the official view is that in the case of any alienation, either voluntary or by sale, it is mandatory on the local authority to demand repayment of the outstanding amount of the grants. In England, I am told, local authorities adopt the view that these provisions are discretionary only. Whether that is the case, or whether there is a difference in the law, I do not know; but, in practice, that is what they do in England, and it is not what they do in Scotland, and Scotland is thereby placed in a more unfavourable position.
It might be argued that someone who receives a grant and carries out the improvement has got something for nothing, and has therefore increased the value of his property; and that when he sells it, he sells it at an enhanced value. But one has only to do some work under these grants to realise that that is not so, because before the owner can receive a grant the statutory requirement is that he must let that house for a specified number of years—I think twenty years—to an agricultural worker. If it is let to an agricultural worker, the maximum rent which can be recovered in respect of that 479 house is 6s. a week. As the house, unimproved, is worth 2s. 6d. a week, the net gain in rent which the owner is allowed to recover is 3s. 6d. a week, or £9 a year, which represents something of the order of 2½ to 3 per cent. In most cases, if the owner gets a grant of £400 (and we have no trouble at all in getting full grants) it means that he has to spend £800, which means that he has to find the other £400, possibly by borrowing; and if he borrows the money, he has to pay something of the order of 6 per cent. interest. Anyone can see that such an owner is well down by improving his property.
If, on the other hand, he improves his property on a lesser scale—he can put in a bathroom for sanitation, or a hot water supply, to the requirements of the local council for a sum of £250—he gets no grant at all. Even then he is still down; and therefore it seems to me unreasonable that in Scotland the unexpired amount of land should be demanded back when it is not in England, because in point of fact whatever he does, whether he receives the land or whether he does not, the owner is still "down on the deal" if he improves his property. That is not an encouraging thing for housing. I just mention that point in passing, and hope that I may be able to receive an answer. As I say, I did not warn the noble Lord that I was going to raise it, so I cannot expect an answer.
To my mind, it is a pity that no provision is made (this may not be an appropriate place for doing so) for reasonable grants for retirement houses. By that, I mean that the people who live in Glasgow are not all working, and when they retire they have still to live somewhere. The retired people must live in housing which is already short and, obviously, if means can be provided whereby that position can be alleviated, it will help the main problem. I agree that it is a minor aspect, but it is, I think, worthy of consideration. An extraordinary number of old people have built houses to retire in, and if a grant of somewhere in the region of £600 or £700 were produced for private building of those houses, under the control of the local authority, I believe that a large number of houses would be built out of these crowded areas, such as in the area in which I live, where it is happening 480 without any help at all. It would happen a great deal more if a realistic and helpful grant could be produced, and I believe we should get greater value for money than with a great deal of the subsidised local government housing which these people are now occupying. I should like to leave that thought with the noble Lord, in the hope of receiving an answer to some of these points, and I wish him well with this Bill.
§ 5.23 p.m.
THE EARL OF MANSFIELD
My Lords, like the noble Viscount, Lord Stonehaven, I think it desirable to express the fact that, important as Glasgow and the Clyde Valley are—and I fear I must return to them later—they are not all Scotland; and the housing problem is not confined merely to the urban areas of the West of Scotland. We have an acute agricultural and small town problem as well all over the West of the country. I would start by asking the noble Lord, Lord Strathclyde, if he can give me an assurance that in Clause 2 (2) (c), where grants for agricultural houses are mentioned, that, for the purpose of the grants, "agriculture" includes forestry. That is very important, particularly in the Highland areas, where the Forestry Commission often approach the county councils asking for the houses to be built for their special requirements.
Even before this Bill was ever mooted, my own county council were seriously considering having to reduce their rate of building houses simply because of the ever-growing seriousness of the rate position. It is one of the best administered counties in Scotland, and one which used to have about the lowest rates. We have found those rates going up every few years to an extent which is really alarming. Although, naturally, no one likes to have an increase of rent—and the increases under this Bill are bound to be serious in some cases—the fact has to be faced that the position of the local authorities is becoming a perfectly intolerable one; and it will get worse if they are to go on supplying an unending succession of new houses for the rents they have been receiving up to the present time. It just cannot be done without a complete dislocation of local finance. For that reason, Her Majesty's Government have 481 been absolutely right, as well as courageous, in tackling this thorny and unpopular problem, just as they were over the question of the Rent Act.
In the case of my own county we have to some extent improved our position by making full use of the grants for the improvement of the older houses. I entirely agree with the noble Viscount, Lord Stonehaven, that pressure should be put upon those county councils—of whom Ayrshire and West Lothian are striking examples in the wrong direction—who give little, if any, encouragement to the reconstruction of old houses. In my own area, we have dealt with a large number of these houses, and although they may not be new, they are in many respects much better than many of the new houses, either because they are of substantial construction or because what was wrong with them before—the lack of modern conveniences—has been put right.
I must, I fear, for the last few minutes of my speech, return to the subject of Glasgow, and I would urge Her Majesty's Government to pay particular attention to the words of my noble friend Lord Dundee in regard to the provision of multi-storey, if not skyscraper, blocks of flats. By the very nature of Glasgow, there must always be a large number of people whose work must be on or near the Clyde. Glasgow owes its prosperity if not its very existence, to the fact that the Clyde is there. If a large number of people are to work about that river, on shipbuilding and shipping and all the other ancillary industries, it is obvious, if we are to avoid an appalling congestion on the roads, that many of them will have to live near their work. It will not help Glasgow much if the new towns like East Kilbride and Cumbernauld are to be merely dormitories, from which every day vast numbers of people travel by road and rail into Glasgow. It must be remembered that Glasgow lacks the excellent system of electric railways which alone makes transport in and out of London tolerable for the millions who travel there every day.
For that reason, I hope most earnestly that in this reconstruction of the central portion of Glasgow—those eighteen acres, with their 700 people to the acre, and a very much larger acreage where conditions are still very much overcrowded, 482 though not so bad—provision will be made for the housing of a large proportion of those people who will have to work on or near the Clyde.
From another angle, which has not been mentioned to-day, this perpetual extension into the country has one serious result—that is, the diminution of the by no means large amount of first-class agricultural land in Scotland. Year after year we hear all over the country of the way in which good agricultural land is—quite necessarily, admittedly—converted to bricks and mortar or to roads. For example, when there was a new double highway being built between Perth and Dundee (which is by no means complete) we were told that for every mile of the doubling of that highway fourteen acres of first-class agricultural land were to be sacrificed. I myself have had to give up to the housing needs of Perth a considerable acreage of the finest land of Scotland. I did so without protest; it had to go, because there was nowhere else for the houses to be built.
At the same time, we need to make every possible effort to see that our housing takes place in the urban areas which are already non-agricultural, rather than allow this continual diminution of our meagre agricultural resources. And where it is essential to take land far outside the town, attempts should be made to make use of areas which are of inferior agricultural value. I know, for example, that in a certain English town in the Eastern Counties great indignation was caused when their overspill was put out into new suburbs on excellent land in East Anglia, whereas only two or three miles away was semi-derelict land reclaimed from the marshes which would have done equally well for housing and there would have been no loss to agriculture.
This is an excellent Bill and Her Majesty's Government are to be congratulated on it. Every speaker who has addressed us to-day has made it clear that he appreciates, as the Government do, that the problems of our Scottish housing are very difficult indeed. They will not be entirely solved by this Bill, but the Bill will go some considerable way to dealing with what is probably the worst problem that Scotland has to face or will have to face for many years to come.
§ 5.31 p.m.
§ LORD GREENHILL
My Lords, ably and clearly as the noble Lord, Lord Strathclyde, has stated his case on behalf of the Government on this Bill, I am afraid I shall be bound, in spite of the harmonious speeches to which we have listened, to introduce a slightly discordant note, because I do not think that this is a good Bill; nor do I accept the reasons given by the Government for the measure that is being submitted to us to-day. Indeed, I rather feel as the Undersecretary of State in the course of his Second Reading speech said, that this was, I think, the fifth part of a scheme to regularise the position in regard to subsidies and housing, and that he thought that this was a good thing to do. My own view is that this is part of a well-recognised pattern to try to increase the cost of living in houses for the people in this country.
It is not many weeks ago since noble Lords were being asked by Government spokesmen to accept as a fact that the supply of houses was now almost satisfying the demand and that therefore we could look forward comparatively soon to a state of affairs in which there would no longer be the scarcity of which we have heard so much to-day. Basing their action upon that view, what the Government said was, "We can now decontrol a number of the houses and charge bigger rents than the tenants have been in the habit of paying, and thus enable those poor investors in property to derive some little benefit from the investments of the past of which they have been so long deprived." My own feeling is that this is all part of a pattern to make the people pay more for their housing accommodation that they have been paying up to now.
This Bill, as has already been admitted by noble Lords opposite, is really two Bills in one, if we ignore Part III: one dealing with a particular problem, the problem of Glasgow's overspill, and the other dealing with subsidies, which is in a sense a finance part. Because of what the noble Earl, Lord Dundee, has said, I should like to say this: from my own experience within the local authority for a fair number of years, I do not think that Glasgow has been at fault in its housing policy in all the years that I have known it, because the present administration of Glasgow 484 began in 1933 with an inheritance which then was of the meanest kind. Speaking for myself, I would say that Glasgow's housing problem is insoluble. It is the kind of thing one does not like to reconcile oneself to, but my personal view is that Glasgow's housing problem is insoluble as far as Glasgow is concerned, and the only thing that can be done to deal with that problem, if the Government are really concerned about housing, is for them to take over the job themselves and to provide the necessary money for the necessary dispersal, if you like, of the present population.
The noble Earl, Lord Dundee, has apparently overlooked the fact that in 1946 the late Sir Patrick Abercrombie drew up a very detailed plan for the whole of the Clyde Valley area. That plan was in great detail. It is also known that the city architect of Glasgow issued a report containing some fifty-six pages on that plan, criticising it on the grounds that the population of Glasgow was not catered for within the area of Glasgow. He went into great detail showing how he would have dealt with the problem had he been allowed to do so. He put forward a plan; the plan was not accepted. There have been a couple of city architects since and nothing better has been produced. The noble Earl is also aware that this Gorbals plan, which the noble Lord, Lord Strathclyde, has pressed and which the Secretary of State has accepted and approved of, is one which has also received criticism in the current number of the Scottish Economic Journal in which not the idea itself is condemned but the fact that this is the largest undertaking of its kind, and somewhat extravagant in cost, though perhaps wholly necessary, into which the Corporation itself has gone. I express no opinion about that, but I want to warn the noble Earl, Lord Dundee, that these things are not so easily solved. It is all very well to say that the solution lies in having skyscrapers for the housing of your people—
§ LORD GREENHILL
I should hope not; but even as the major part of the solution I should be inclined to say that it is not the best thing to do. If the noble Earl has seen, as he must have seen, conditions in the Knightshill and Blackhill 485 areas with their tall tenements, he will realise at once that it would be destroying any amenities the city may have had in order to accommodate the people. But suppose, for the sake of argument, that we were trying to work out the Government's policy and that we admitted that 300,000 of the poulation had to be moved out, what guarantee have we that some of those who were moved out would not be replaced by incomers and so leave their numbers more or less stationary? Because you could not get rid of your population as easily as that. Indeed, the noble Lord, Lord Polwarth, said in a very statesmanlike way, "This is not an easy problem to solve. You cannot bulldoze a population. They are human beings. You cannot compel them to work where you want them to work. You have to think of what they, too, want to do."It is not a problem that can be solved within ten years or, as the noble Lord admitted, within a generation. It is a kind of gradual problem; you must take time to solve it.
Let us assume for the moment that the Government will try by means of this Bill to apply a remedy—a partial remedy if you like—towards this very big problem, and let us look at the subsidy suggestions that have been made. My own view is that, underlying the series of Acts that we have recently had to deal with, the main concern has been a financial one, and I am wondering whether the Treasury are not exercising, for reasons which are understandable, a greater amount of pressure than we have been accustomed to in recent years. Indeed, one wonders whether this is not a kind of attempt to introduce deflation by experiment. We know what the danger is; we do not need to know what to do to avoid inflation if we can. But is this the way to achieve it?
Take the subsidy problem. The Government have discovered a number of different kinds of needs. It would be amusing, if it were not rather depressing, to find that there are approved needs—there is £24 per house for that, because that is merely for rehousing from unfit houses, from overcrowding in shared rooms, or for those who are held to be unfortunately disabled, and so on. The Government then say that they are prepared to consider specially hard cases. Then there is the second kind of need, which they call an urgent need. There is 486 £30 per house for that. That is to cater for incoming industries which it is desired to attract by this extra subsidy. Then there are special needs to deal with the overspill, for which £42 per house is provided. Then there are exceptional needs. That does not involve a question of subsidy at all, because the Special Housing Association will assist the authorities and build whole houses for them. The Government has already warned the authorities that they must not expect too many houses from that source, but they are there if necessary. Then there is the need for high flats, a point which the noble Earl, Lord Dundee, stressed, whereby if you build above a certain number of storeys you provide extra accommodation.
Let us face this problem with some degree of appreciation of what is involved. Local authorities do not want to have their finances upset by not being able to meet their housing requirements, and I must admit that I was rather pleased to note that Glasgow was not the worst city in Scotland in charging lower rents than it ought to do. But the noble Lord himself would be the first to admit that economic rents cannot be expected from any authority because even with the Government contribution, even with the compulsory rate contribution, we are still left with a deficit which would entail demands upon tenants to bring their rents to an economic level. While it may be true that £39 would be the average rent if the full rent were charged, the noble Lord himself would be the first to admit that people cannot be expected to pay the difference between what they are now paying and the £39, except in that it is spread over a number of years so that people could gradually become accustomed to the heavier burdens they were asked to meet.
In Glasgow, as the noble Lord is probably well aware, the rate of interest which the Corporation charge to the housing department is not the current rate of interest, because Glasgow has its own Loan Fund—a sort of bank—and it charges the department the appropriate rate. This is how it works out at the moment. The rate of interest charged on capital borrowings for the year ended May 31, 1956, was £3 11s. 10d. per cent.; the average rate which was paid on the mortgages borrowed from the public was £3 13s. 1d.—in other words, it would appear as though it should be paying 487 more than it is charging for its mortgage moneys. That is accounted for by the fact that not all moneys are borrowed on mortgage—some are on short term, and they are able to charge a lower rate to the department than is current just now. The noble Lord is also aware that, although at the moment the rate is below rates currently being charged, the higher rates now being charged for moneys borrowed to-day would have to be reflected in future rates.
There is another point that I should like to make, with just a little caution. As the noble Lord pointed out, Glasgow is not charging an economic rent and is making the ordinary ratepayer pay part of the subsidy which the council tenant enjoys. I myself feel that Glasgow Corporation ought, and should, consider bringing that figure a little more into keeping with what is appropriate to-day, because I do not think that one can wholly justify a position in which 9.47d. represents the statutory rate contribution, whereas the deficiency—that is, the extra money rated for—comes to 2s. 0.75d. That, I think, ought to be equalised and brought more into line.
I appreciate that I have taken more time than I should have, but there is one thing more that I should like to say before I sit down. I see no reason why the Government, in charging local authorities rates of interest upon the money they are prepared to borrow, must charge what is more or less the current rate. I see no reason why there should not be a differential interest rate for particular purposes—in this case particularly for housing. If that were done, then I think that local authorities would feel considerably relieved from the burdens from which they are now suffering. There will be a Committee stage on this Bill, and there I should like to deal with Clause 15, with which I will not trouble the House at this moment.
§ 5.47 p.m.
§ LORD STRATHCLYDE
My Lords, I am most grateful to all noble Lords who have taken part in our discussion on the Second Reading of this important Bill. I should like to say to those noble Lords who called attention to the fact that Glasgow is in Scotland, that surely all of us in this House know Scotland. Everyone realises that to be the fact. Nevertheless, 488 this Bill is dealing with a situation which exists in industrial Scotland, and principally in the City of Glasgow. Therefore, Part II of the Bill must be related particularly to the circumstances which exist there. So far as Part I of the Bill is concerned, that is applicable to Scotland as a whole.
The noble Lord, Lord Mathers, said that as a result of the drastic changes which are taking place in these subsidies, if justice were to be done and hardship were to be prevented it would call for an individual means test. I do not for one moment believe that. If the noble Lord would be good enough to look at the Report of the Working Party on housing subsidies and see the comparison between the rents paid in England and those paid in Scotland, I am almost inclined to think that he would feel slightly ashamed of the constant grumbling there is about paying anything like a reasonable rent for a house in Scotland. The noble Lord also spoke of the failure of the Government to accept the advice which had been offered to them in another place in relation to an Amendment moved by a right honourable gentleman, which Amendment would have allowed any receiving area to be scheduled as a development area under the Distribution of Industry Act, and in that way, I assume, to qualify for Board of Trade financial help. Well, it was rejected, particularly for one reason: that any area can be scheduled if there is likely to be a special danger of unemployment; and therefore, if that is so, it would not seem that the advice offered was necessary.
As the noble Lord said, there will be many personal problems, because we are dealing here with the human element, and we should be careful, in all we do, to consider both their wishes and feelings. But I believe, with the noble Lord, that some good will come out of the Bill. The noble Lord said it was the responsibility of Her Majesty's Government. No, my Lords! It is not the entire responsibility of Her Majesty's Government: it is the responsibility of the local authorities, both the exporting authority and the receiving authority; and it is the responsibility of industry and of every citizen in this country where overspill exists to see that they do their best to make it work. I do not think that on this Her Majesty's Government have 489 anything to fear at the next General Election. They have done something which no Government for nearly thirty years have had the courage to tackle, even when they knew perfectly well in their hearts, and had had it proved by facts, that many things were crying to be put right in Scotland. Time and again Governments shirked that issue; and that applies, too, to the Party to which the noble Lord belongs.
The noble Earl, Lord Dundee, I was glad to hear, did not consider that the Bill would have any adverse effect on housing. Nor do I believe that it will. He spoke of the pre-war housing record of Glasgow, which is a matter on which I prefer not to touch—I do not think it really comes into the Bill. But it is a very slow job, clearing out slums and putting houses in their place. Anyone who has been engaged upon that, as the noble Lord, Lord Greenhill, has been, will be able to tell your Lordships just how difficult it is to arrange to decant a population before pulling down their houses and getting a place in which to put them. It is a difficult matter indeed, and I do not want to say anything which would make people imagine that what faces the City of Glasgow is anything at all easy.
I hope that the noble Earl did not misunderstand my remarks about the Scottish Special Housing Association. He spoke about that Association as going to build half the houses. They will do that only where there is reason for them to be employed in view of the financial circumstances of the importing authority, and then only within the limits of their programme, which is laid down from year to year. As to the claims of building upwards, from models I have seen the Corporation are going to build very high blocks of buildings over all the new development area. I, too, wish that I could say it was possible that this terrific problem could be solved within a generation. The noble Earl said that it must be; but, frankly, I do not know how it can be. The task of building houses for 300,000 people from one city and redeveloping that city at the same time, all within a generation, is something that rather staggers the imagination.
The noble Lord, Lord Polwarth, spoke of the need for an active and enlightened 490 distribution of industry. I submit to him that he will find in this Bill a scheme for the active and enlightened distribution of industry. I cannot think that this scheme has been worked out other than as the result of examining the whole situation in regard to the removal of industry—that is, redistribution of industry—from Glasgow to these new reception areas. In doing so, we have taken note of what has happened elsewhere and have tried to meet the objections which have occurred in those places. The noble Lord said that no other generation should again be faced with a like situation. I would pray noble Lords, and other people also, to consider the circumstances under which our great industrial cities came to be built. Our forefathers are constantly accused of being mean people who demanded great sums of money for their land, with the result that people had to be herded together. That is not true. The fact of the matter is that there was then no means of transport and people had to live near to their work.
§ LORD STRATHCLYDE
Whether or not there was an Industrial Revolution, people then had to live near their work because there was no transport.
The noble Viscount, Lord Stonehaven, asked me about improvement grants. That is a subject for a housing debate, rather than a debate upon a Bill of this nature; but one of the reasons why repayment of improvement grants has to be asked where the conditions are not met—and one of the reasons why there should not be an appeal to the Secretary of State—is that that money is local authority money. It is money advanced by the local authority for the improvement of houses within their own area, and it would be rather awkward if the Secretary of State had to decide whether or not money was to be paid back. But, in any case, whoever obtains an improvement grant for the improvement of his house does it in the knowledge of the conditions, and my own view is that these conditions should be adhered to.
I have noted the suggestion of the noble Viscount, Lord Stonehaven, that there should be a grant for private building of houses for the aged. At the same time, 491 there are constant complaints that the Government are already spending too much money—
My Lords, would the noble Lord allow me to interrupt him for a moment? The point I tried to make was that this was not a question of complying with conditions, but that where a local authority refuse a grant, or give a grant of less than 50 per cent., the position, as I now understand it, is that the applicant can request the local authority to give their reason; and the local authority must then reply to the applicant, in writing, stating the reason. The suggestion I make is that that would be ineffective unless the Secretary of State also had the information, otherwise he could not give any recommendation or advice upon the matter.
§ LORD STRATHCLYDE
My Lords, I thank the noble Lord for enlightening me, but the answer is the same. The money is local authority money, and they are therefore entitled to give 50 per cent., or any other amount, or none at all. I do not argue whether it is right or wrong, but that is the situation.
The noble Earl, Lord Mansfield, asked me, in relation to Clause 2 (2), whether "agriculture" includes forestry. The answer is, Yes. I would just refer the noble Lord to Section 184 of the 1950 Act, where agricultural population and agriculture are defined, for the purpose of subsidy, as including workers engaged in afforestation. The noble Earl suggested that places like East Kilbride and Cumbernauld were not much good from the point of view of reducing travel. What we are trying to do is to build up a balanced community in these places, which will avoid travelling. We are trying to see that a balanced community is the result of any movement of overspill. I can also assure the noble Earl that the Government do everything in their power 492 to see that agricultural land is not used for purposes other than agriculture.
The noble Lord, Lord Greenhill, and I, of course, do not see eye to eye on this matter at all. He says that our recent Acts have been all of one pattern—to make people pay more for houses. But should people not pay the just price for the article? Does the noble Lord contend for one moment that a rent of £8 a year for a house in Lanarkshire is a reasonable payment for the accommodation provided, or even a rent of £15 a year in Glasgow? Does the noble Lord really consider that people who can pay for houses should be subsidised by other people? I think it is one of the most iniquitous things I know. I think it is reasonable to require that a reasonable rent should be charged in all cases. As I said in my speech, those who can pay ought to pay; those who have a housing need and cannot pay should have their housing needs supplied for them. I do not believe that anyone should be subsidised unless in need. Let me say that, in my opinion, there is no need at all for any great charge on the rates for housing in the City of Glasgow. I say that in view of the facts produced in the report of the Working Party to which I have referred. My Lords, I have endeavoured, to the best of my ability, to answer the various points which have been put to me in the course of the debate. I trust that your Lordships will now give this Bill a Second Reading.
§ On question, Bill read 2ª, and committed to a Committee of the Whole House.