HL Deb 07 July 1959 vol 217 cc764-88

2.48 p.m.

Order of the Day for the Second Reading read.

EARL WALDEGRAVE

My Lords, I beg to move that this Bill be now read a second time. I should like to start, if I may, on a somewhat personal note. I am very conscious of the fact that many of your Lordships have a far greater personal knowledge and experience of the new towns than I have. The noble Lord, Lord Silkin, can rightly be regarded as the father of the New Towns, as it was his 1946 Act which brought them into being. That Act must be acknowledged as one of his greatest achievements, and it has proved an admirable instrument for its main purpose—that is, the rapid development of planned new towns.

But, though I cannot speak with anything like the first-hand experience of some of your Lordships, I speak as a member of a Government which has the interests of these New Towns very much at heart. We are bringing in this Bill for one purpose, and for one purpose only. I cannot do better than quote the words of my right honourable friend the Minister of Housing and Local Government in describing what that purpose is. He was speaking in the Second Reading debate on this Bill in another place. He said of this Bill [OFFICIAL REPORT, Commons, Vol. 596 (No. 25), col. 951]: The ultimate lest will be whether Parliament so shapes its new towns policy that the new towns will flourish and that the thousands of people in the new towns will be able to enjoy the sort of life which we wish them to have. I hope to be able to convince your Lordships that this Bill does just that—no more and no less.

I need hardly remind your Lordships how these towns came into existence. You will remember that development corporations were set up under the 1946 Act with the necessary powers to carry out the duty imposed upon them of creating new towns. This was an audacious and revolutionary experiment designed to provide for the overcrowded population, particularly of London. Your Lordships will remember the devastation of London at that time, and the squalor in which so many were forced to live. And Section 15 of the 1946 Act envisaged that when the development was substantially achieved the local authorities would take over, lock, stock and barrel, then and there.

I now turn to the Bill. My Lords, this Bill is in two parts; both parts are excellent—unlike the parts of the famous curate's egg—but the most important part, and the one which aroused most discussion in another place, is Part I. There is in fact only one clause in Part II to which I think I need draw your Lordships' attention: Clause 11 which authorises an additional £100 million to be spent on capital development, bringing the total figure that can be spent up to the formidable sum of £400 million, which shows the importance which the Government attach to this subject

Part I gives effect to a statement made by my right honourable friend in another place on July 29, 1957. As this was some time ago I think it may be wise if we refresh our minds as to what it was that my right honourable friend said at that time. He said [OFFICIAL REPORT, Commons, Vol. 574, col. 924]: The Government…have reached the conclusion that it would not be the best plan to transfer wholesale to local authorities the ownership of the properties which are now in the hands of corporations. We propose, instead, to establish a new agency to take over the property and liabilities of the corporations in England and Wales as they are wound up. This will, of course, all require legislation. This Bill is the legislation referred to and it provides for the establishment of a single Commission to take over and manage the property of the new town development corporations as they complete their task and become ripe for dissolution. The clauses describe the functions and duties of the Commission, the method by which it will be financed, and the procedure by which it will take over the new towns at the appropriate time. This part of the Bill does not apply to Scotland, because, as my right honourable friend the Secretary of State announced in another place on the day after the Minister had spoken, the Government do not feel that the time is ripe to take any decisions about the future of the Scottish new towns.

The Bill itself is short and lucid, so, in spite of the importance of this part of the Bill, do not think I need to spend much time in introducing it to your Lordships. Perhaps I may briefly put it like this. It was always intended that the development corporations were to be relatively short-lived and confined solely to their function of building and developing the new towns. But the 1946 Act envisaged only two stages in the life of these new towns (and this is where, with great respect, I think events have shown that the noble Lord, Lord Silkin, made an error of judgment in his Act). The first stage was the development corporations; and the second stage the handing over of all the assets to the local authority which would be born in the new town.

Some of the development corporations are now nearing the end of their task. And the Government are now convinced—and there is a wide measure of agreement on this point throughout the country and in the new towns themselves—that there should be three stages in the life of the towns, not two. The second stage, with which this Bill is concerned, must, we feel, be a stage of consolidation and good estate management before the assets are handed over permanently to anybody.

Clause 2 (1) provides that the Commission shall be established for the purpose of taking over, holding, managing and turning to account… Clause 2 (2) provides that: It shall be the general duty of the Commission to maintain and enhance the value of the land… The Commission is not a disposals board. The clause is carefully drafted to provide against that. All the emphasis is placed on the retention and sound management of the assets of the Commission, and not on disposal of them. I would go so far as to say that it would be illegal for the Commission to act as a disposals board in order to realise the assets; and it would be equally illegal for the Minister to direct them to do so. Neither is the Commission (as the local authorities would have been under Section 15 of the 1946 Act) the permanent ultimate owner of the assets. The Commission fills the gap in an intermediate stage and the decision on the ultimate policy for final ownership is deferred. The belief is that the Commission may well have to be in existence for ten or twenty years. Let us take that fence when we come to it in the light of circumstances that will then prevail. Diversification, private ownership, municipal ownership or the combination of the three. Stage 3 is not a matter of immediate urgency now. After all, we have not yet reached stage 2.

Let us consider what the position will be when a development corporation finishes its job. The town will have grown extremely rapidly. The local authority to which it will have given birth will, I do not doubt, be enthusiastic and efficient, but in the nature of things it cannot have had much experience. It will have a formidable job in administering all the usual local government services; but it is to this local authority that the 1946 Act would have added the additional responsibility of becoming overnight, and at the stroke of a Ministerial pen, a landlord on an unprecedented scale.

Now the main function of local government, as your Lordships are well aware, is to provide services. The whole local government machine is geared to that and there is a wealth of experience. Units of local government certainly can and do own property—particularly rented houses. Are not these houses known to most of us, certainly in the rural districts, as "council houses"? But it would be something altogether new and unproved that a very new urban district council should suddenly, overnight, own not only all the houses but the shops, the factories and everything else. I would remind your Lordships that the dangers in this course were apparent to the Reith Committee. In paragraph 83 of their Second Interim Report in 1946 they say: There are disadvantages and dangers in the one body being both landlord of the entire area and local authority. Though there are at present substantial areas of towns owned by local authorities, there is no case where the entire area of a town is so owned. The problems which are inseparable from monopoly might present themselves here; and continuity of policy in the management of the estate might be endangered by the changes of personnel natural to and proper in a publicly-elected body So much for the Reith Committee. We think there is considerable substance in the warning that was then given, and the Government do not think that this is an experiment that should be tried at this stage of the life of the new towns, and at this moment of time. A local government unit is not the best instrument, in our view, to carry out this next stage of the estate management and consolidation that is now clearly called for.

But it may be said, if we agree to three stages instead of setting up a single Commission, could not the development corporations have been kept alive? That was a possible solution, and one which is I believe favoured by the Labour Party; but the Government do not think it is a very happy one. In the first place, so long as the development corporations remain in being, all their powers under the 1946 Act will also remain in being. These powers were given to them to do a development job, and they are not suitable for what must become primarily a management job. For example, the development corporations are virtually immune from local planning control. They have compulsory purchase powers, and they have more powerful rights as against their business tenants than ordinary landlords have. Special powers like these, we feel, ought not to be kept alive after the conditions for which they were appropriate have changed.

Another point I should like to emphasise is the fact that we do not think that each new town development corporation should hand over to a separate local unit of management. The twelve new towns in England and Wales are not similar. Each one was built on very different foundations. At Hemel Hempstead and Basildon there were large existing populations. I understand that at Basildon they were largely shack dwellers. At Hemel Hempstead, there was a substantial and ancient town. At Harlow, as the noble Lord, Lord Taylor, will know, because he has been connected with it almost since its inception, there was an almost virgin site. Their rates of development are different and ultimate size will vary. The conditions at Peter-lee, in Durham, are totally dissimilar from those in Cwmbran, in Monmouthshire. In our view, therefore, the setting up of one central management agency, with some of its functions properly delegated locally, will have many advantages. The picture can be seen as a whole, and there will be a financial gain. One of the greatest merits of the single Commission will be that financially all the new towns can be treated as a whole, and the stronger will be able to help the weaker.

But some noble Lords may say that a centralised Commission operating, as no doubt it will, from London, will have all the disadvantages of a remote absentee landlord with no real understanding of the needs of the people living in the towns. My Lords, may I say at once that the Government are fully aware of this danger, recognise it, and are determined to avoid it. The First Schedule to the Bill will make it obligatory for the Commission to delegate responsibility for management of its rented houses to a local committee. My right honourable friend will require the Commission to submit their arrangements for delegation to him for approval. He will be able to see that they are satisfactory, and that the mernbership of the local committees is such that the inhabitants of the towns are confident that their feelings and needs are properly understood.

Perhaps I ought to mention one other point that has aroused some criticism, Clause 2 (7)—the destination of the Commission's profits, if any. I hope that I may be able to satisfy your Lordships that criticism on this score is founded on a certain measure of misunderstanding. Clause 2 (7) of the Bill provides that the Minister may require the Commission to pay any overall surplus over to him for transfer to the Exchequer.

Let me say at once that there is no intention of allowing the Treasury to starve the new towns. The Commission will be allowed to spend reasonable sums on the towns, in the same way that the best and most enlightened landlords already do and have always done. We are giving the Commission specific power to contribute towards the provision of amenities. This power is wider than the powers which the development corporations now have; indeed, we have extended those powers for the corporations themselves in Clause 13 of the Bill.

However, some people think, and have said, that the Treasury ought not to expect more than a fixed return on its investment, and that anything over and above that should go to the benefit of the towns themselves. That view is held sincerely and, naturally, commands respect; but what does it amount to? Surely, it amounts to saying that the Treasury should be regarded as the debenture holder, and the new towns as the equity holder. I must remind your Lordships that the Exchequer provided not only the debenture capital but the equity capital. It amounts to saying that if the new town enterprise shows a genuine profit—and I emphasis "if"—there is nothing, and never can be anything, better the Government could spend it on than the new towns themselves. No Government could possibly accept the view that a particular part of the revenue should be devoted for all time to a particular purpose. It must reserve the right for itself and its successors to decide how the revenue can best be used in accordance with the needs of the day.

I will not detain your Lordships longer. I hope that I have been able to convince your Lordships that this is a good Bill. We believe in the new towns. That is why we are providing another £100 million for their completion. We are convinced by the experience that has been gained in the last thirteen years that there should be three stages and not two, in the life of these towns. We believe that it would not be right simply to perpetuate the development corporations for the intermediate stage; for their statutory function for stage 1 is quite different from what their function would have to be in stage 2. Therefore, we propose this new Commission of experts to hold, manage and turn to account",… to maintain and enhance the value of the land so that the new towns can enjoy, in this intermediate stage, while they are still in public ownership, this period of stable and sound estate management which we believe to be so essential for their ultimate welfare. My Lords, I beg to move.

Moved, That the Bill be now read 2a.—(Earl Waldegrave.)

3.8 p.m.

LORD SILKIN

My Lords, the noble Earl began his remarks with a personal note, and I hope he will not mind if I do the same. The new towns were created as a result of the 1946 Act—an Act which I had the high privilege of introducing in another place. It was at that time accepted by the then Opposition with a considerable amount of scepticism. It was regarded as visionary. It was regarded as something which might come about in thirty or forty years' time. Indeed, the Minister of Housing and Local Government, in the course of his argument in another place on an Amendment, in effect gave that as an explanation for something to which I am going to refer, though the noble Earl did not mention it. While the Bill did not arouse active hostility, and there was no Division on the Second Reading, it certainly was not accepted wholeheartedly. It was accepted as something that might come along. It was thought, "This is a young Minister and a young Government. Let them have their fling, but nothing will really come of it" That was the spirit in which the noble Earl says they believed in new towns.

One of the provisions in regard to these new towns was that they eventually, when they were substantially complete, should be handed over to the local authorities. Every Member of Parliament was aware of the Reith Report. And we decided—all of us; not the Government alone, but the then Opposition as well—to override the Reith Report in that particular respect. After all, even the noble Lord, Lord Reith, would not claim deification; not every word the noble Lord utters can be regarded as sacred. Most of his Report was accepted, but not that particular point. That view, as I say, was not only the view of the Government; it was the view of the Opposition. Indeed, the Opposition at that time were much more enthusiastic about limiting the life of the development corporations, and about handing over the new towns to the local authorities, than was the Government itself.

They regarded the provision in the Bill as originally introduced as not being strong enough, and Amendments were submitted by Mr. W. S. Morrison and others to make it more certain that, when the new towns were substantially completed, they would be handed over to the local authorities. I have mentioned Mr. W. S. Morrison. Mr. Hugh Molson, the present Minister of Works, was another who was most firm that there should be no ambiguity. The noble and learned Lord, Lord Reid, also spoke on that occasion in the same terms. Eventually, as a result of the pressure that was brought in another place, the then provisions were amended and strengthened, and it was made as definite as possible that when the time came the new towns would be handed over to the local authorities.

In this House the noble Earl, Lord Munster, speaking for the Opposition here, was again most firm that the new towns should be so handed over. He thought that the Bill was in that respect an excellent Bill. The noble Viscount who then led the Liberals, Lord Samuel, said that this was an excellent provision, that they should be handed over. So that if we were wrong we were all wrong together, except perhaps the noble Lord, Lord Reith. If it was a mistake, it was not a mistake of mine only; it was a mistake of all Parties. Let us be quite clear about that. Of course, it is possible for everybody to make mistakes, and thirteen years after the event it is quite proper to have second thoughts. But I should like to consider whether those second thoughts are really justified.

Let me take some of the arguments that have been put forward as justifying what is being done to-day. I need hardly say that, in my view, there is no justification whatever for this change in outlook. The noble Earl talked about three stages: the first is the development stage, the second the consolidation stage; and I suppose the third is the final destiny of the new towns, although this Bill says nothing whatever about the third stage. But I do not agree with him that there are three stages. There are two stages: stage one is the completion of the new 1 town, and stage two is its destination; and the completion includes the consolidation. After all, when we talk of the completion of a new town we do not mean the new town without its amenities. It would be quite wrong to suggest that a town is substantially complete if it lacks adequate open spaces and recreation grounds, halls and swimming baths, and all the things which a normal town has and has created over the years.

Nor can one properly say that a town is substantially complete if there is no room in the new town for the younger generation; if, when they grow up and want accommodation, they have to move away from the new town and start life afresh. It would be quite wrong to suggest that in such circumstances the towns are substantially complete. In my view, even the most advanced of the new towns would take five or six years as a minimum before it reached that position. I would have suggested, therefore, that it would be quite proper to take the view that the new towns are not yet substantially complete, and will not be complete merely because a certain number of houses have been built. They will be complete only when provision has been made for all amenities, when the amenities have been provided, and when there is provision for the corning generation who may want to live in the towns. I will return to that matter in a moment, because certain things flow from it.

I want to deal next with some of the reasons why the Government claim that they are justified in going back on their own early views, the views which they pressed most strongly on the then Government, both in this House and in another place. The first is that in most of the new towns the council would be owning about three-quarters of all the properties in the district (that was the figure mentioned by the Parliamentary Secretary), and that that is something quite outside the normal functions of a local authority in this country. I would not agree that there are not a few local authorities which do own about three-quarters of the properties in their district. There are a few, though I would not pretend that there are many. Nor would I pretend that it is a normal thing—certainly not. But are we to be governed for all time by what is normal practice? Are we never to make experiments? Are we never to try out something that has not been done before?

After all, we are constantly imposing upon local authorities new duties. It could be argued in every case that "This is outside their normal functions" and that "It has never been done before" But we do it; and generally in the past the local authorities have risen to the occasion. They may be inexperienced in the management of estates; but, after all, one gains experience by being trusted and by being given the opportunity. I know that most noble Lords would agree that when our people are trusted, when a local authority is trusted, whether it be Conservative or Labour, it has risen to the occasion, and we have not gone wrong in trusting them. It is wholly undemocratic not to trust people. I do not accept the view that because this is not part of the normal functions of a local authority, therefore they ought not to be entrusted with this particular task.

After all, the development corporations were new; they had had no experience at all of this kind of development. I think the tributes that have been paid to the new towns are sufficient proof that the confidence which was placed in them has in every case been justified. There have been a few isolated occasions when perhaps a chairman was not up to the mark, and he has been gently given a hint that perhaps his services would be more valuable elsewhere. But, by and large, they have done an excellent job, because they were trusted. The first thing I said to the development corporations when they were created was, "Don't be afraid of making mistakes; you are bound to make some mistakes. But be courageous and imaginative; and if you make your mistakes in good faith we shall stand behind you" But they have made remarkably few mistakes, and I would submit that the local authorities, if they were trusted, could be relied upon to do the same.

It is suggested that the local authorities would be the owners of the greater part of the land in their area, and that the rents would become the subject of electioneering. There are local authorities to-day who are large owners of property—not so large as the new towns would be, but they are large owners—but they have not shown any particular irresponsibility. Sometimes rents are an issue; sometimes they are an issue even in national Government, as the noble Earl knows quite well. There may be differences in policy and outlook, but there is no suggestion of bad faith. If the fear is that commercial properties will become the plaything of politics, I would submit that practically all the commercial and industrial premises in the new towns which have been substantially completed by now have been let at fixed rents for long periods, and it is impossible for the local authority to interfere with those rents for a very long time ahead. Furthermore, there is the protection to the tenants that, when their leases come to an end, they can, if necessary, go to the courts and ask them to fix a fair rent. That was the result of legislation which was introduced by this Government and which I strongly supported, and I think that that fact should be a sufficient safeguard against the remote possibility of rents being the plaything of politics in these new towns. That was the first objection that was put forward-the first reason for changing the policy which had been the policy of both Governments for many years.

The second argument put forward was that it is undesirable on social grounds, and on the general consideration of the proper functions of elected authorities, that they should be involved in estate management. I think I have dealt with that so far as I can; I see nothing inconsistent with the job of a local authority that it should be involved in estate management. I should imagine that the estate management department of the London County Council must be one of the largest in the world—certainly, one of the largest in this country—and nobody has suggested that it is undesirable and wrong on social grounds, and on the ground of the general conditions applicable to the proper functioning of elected local authorities. Nobody would suggest that there should be set up a Commission to look after the properties to-day owned by the London County Council or by the City Corporation, or by any other large local authority, and I see nothing different in principle between that and the local authorities in the new towns taking over the assets and liabilities of the development corporations.

The third point put forward was that this is not a good moment for the financial settlement of the transfer terms: that some will not be paying their way at this point; that they will continue to grow, and it is hoped that values will continue to appreciate. If it is not a good moment, there is no reason why you should have a financial settlement, but you can settle the principles. And I see no reason why you should not be able to make a financial settlement later, when the town is substantially complete. It is not suggested that incomplete towns should be handed over. My view is that probably none of the new towns will be complete for some years, and therefore to say that this is not a good moment for a financial settlement is quite beside the point.

It has also been said that at this moment a number of towns which are substantially complete, or will be substantially complete in a short time (that is on the basis of the noble Earl's definition), are still showing a deficiency. In another place—the noble Earl did not put it in quite these terms to-day—it was suggested that Crawley, which is the first of the new towns which is likely to be complete, is actually showing a deficiency. That is perfectly true. The deficiency last year—that is, for the year ended March 31, 1958, for Crawley, was £3,640. Their revenue and rents amounted to £876,000, and after setting aside and paying interest of over £1 million—of course, they received subsidies on their housing as well—and making provision for depreciation of £143,000, there was this deficiency of £3,640, which I imagine by this year will have been converted into a surplus. That was the example that was given in another place, and not by the noble Earl, of the new towns still having a deficiency.

But it was rather odd that Crawley should have been given as the one example, because I want to go to the next one, Harlow. Harlow, again after providing for interest and £220,000 for depreciation, shows a surplus of £57,500. Take the next one, Hemel Hempstead, In the same circumstances it shows a surplus of £49,000. The last one I want to take is Stevenage. Even that is showing a surplus of £28,430 after paying all interest and allowing for depreciation. So that to say that this is not a good moment in which to settle the financial terms of the transfer seems to me just juggling with words. Why not? After all, the resources of valuation in this country are not so slight that it is impossible to make a valuation at any given moment of the assets and liabilities of an undertaking, with the prospects if you like, and to arrive at a figure which is reasonable to both sides. I should have thought that perhaps that was the weakest of the grounds on which Her Majesty's Government have changed their minds. But they have changed their minds and they have done so without consulting the local authorities concerned, leaving the local authorities until the very last moment under the impression that these new towns were to be transferred to them when they were substantially completed.

I think that this is an iniquitous thing to do. It is undemocratic. The noble Earl anticipated that I was going to say that there would be remote control of these new towns. As he said, they are different, very different in all kinds of ways. They are different in type. One is a steel town, another a coal town, and one is a town made up of a number of very small industries. Each has its origin in a different way. To imagine that all of them can be managed from one headquarters which will take into consideration all the different conditions of the new towns seems to me absurd, because there will not, be any kind of local touch.

It is true that there are to be local committees, but will these committees be entitled to settle policy? Surely the whole of the policy will be settled at headquarters, as it must be. When there is a central Commission these new towns cannot each be allowed to determine its own policy, having regard to its own local conditions; and so I submit that it is perfectly true that what will happen is that there will be a general dictatorship from above and that the new towns will be run solely from the point of view of providing not only the return of the capital which has been invested in those new towns by the Exchequer, and the interest, but the profits as well.

The noble Earl believes it is quite wrong that these profits should go to the new towns themselves, but why is it wrong? It is true that the new towns have been helped by Government money, but if the Government get back their money, what more do they want? If they want something for the risk they have taken—well, it was not much of a risk. There were large numbers of people who were prepared to undertake the development of the new towns entirely at their own cost and their own risk, and to take a chance on the profits that they might make. I could tell the noble Earl some of those who offered to do it. There was very little risk involved. But in principle, in any case, is there any reason why the surplus should go to the Government rather than to the people who have been to a great extent responsible for creating the surplus? It is the local people who have built up the town, have made it valuable and will continue to make it valuable; and surely they are the people who should get the surplus.

In my view, the right thing to have done would have been to allow the development corporations to continue until the new towns were substantially completed. By that I mean, as I said earlier, until substantially the whole of the residential property required for the new town had been built, and until the amenities as well as the industry had been provided. That might well have taken another four or five years, but it would certainly have been within the period that we had contemplated. Originally we had set a period of from ten to fifteen years, which we later stretched to front fifteen to twenty years. Within twenty years from the time the new towns were started each of them would no doubt have been substantially completed, on my definition.

I believe that during those last few years it ought to be possible to acclimatise the local authorities to the idea that they would be taking over these new towns. That could be done by putting more local authority representatives on to the development corporations and giving them, if you like, the kind of experience they need. Knowing a great many of these local representatives, I can assure the noble Earl that they would profit considerably by the experience of being on a development corporation. They are very lively, enthusiastic, well-informed young people who may occasionally "go off the deep end" about the H-bomb—they are all the better for that—but who nevertheless have a lively civic sense. Admittedly, they have never been on a local authority before, but I believe they deserve all the credit that we can give them for offering their services and going on these local authorities at the early stage. They will be a very valuable asset to the new towns, particularly if they have been on a development corporation for a year or two.

When that is done we should hand the new towns over to the local authorities on the basis of a valuation of the assets, liabilities, prospects and so on, arrived at by reasonable bargaining between the two sides; and if there is a surplus in due course, I consider the new towns might well have it. But it may be that as a result of bargaining the price to be paid by the local authority would take some account of the profits of the future. That I should not mind at all.

I have not said anything about the details of the Bill itself. I am not happy about many of the provisions, even if it is not possible for Her Majesty's Government to take the view which I have put forward that the development corporations should continue for a time. Even then, I am not satisfied about a number of the provisions, but I do not feel it necessary to-day to set out the various points in the Bill which I believe are deserving of amendment in any case. If this House had a tradition of dividing against the Second Reading I should certainly invite my friends to vote against the Second Reading of this Bill. We think that it is wrong. We do not feel that any justification has been shown for the change of mind of Her Majesty's Government. We do not consider that their reasons are sound. We think that this is an utterly undemocratic way of dealing with the new towns.

Furthermore, although the noble Earl has said that this is Stage 2 there is no indication whatever in the Bill that a later stage is contemplated. There is an atmosphere of finality about the setting up of the development corporations; and, indeed, on the arguments which have been submitted against local authorities being made responsible for the management of new towns, I cannot see that Her Majesty's Government can ever be willing to transfer them to the local authorities. I imagine that those arguments—such as that it is not the function of a local authority to manage large estates—will continue. Those arguments will not get any less valid as the years go by. If that is the view of Her Majesty's Government, is it not sheer hypocrisy to talk of a third stage? Is it not really the case that this is the second, third and perennial stage? For these reasons, among others, I think that this is a thoroughly bad Bill.

3.40 p.m.

LORD LATHAM

My Lords, like my noble friend Lord Silkin, I wish to address my remarks principally to Part I of the Bill, which puts forward proposals which amount to a complete volte-face of the statements of the Government when in Opposition in 1946. My noble friend Lord Silkin has referred to the absence of any indication as to what is to be the third stage. My own view is that no details of the third stage have yet been contemplated. The sudden division into three stages is just an equivocation, in my submission, in order to justify what is unjustifiable—namely, the proposal that these new towns should be handed over to a remote Commission; that they in fact should be transferred to an agency of the State. What I think may well be in mind as regards the third stage is that the ownership shall be transferred to private enterprise and that we may really see the new towns made the subject of a kind of S. G. Brown operation. The transfer to the Commission which is proposed in this Bill can really determine the character and the tradition and the whole, as it were, ethos of the new towns.

We must remember that each of the new towns is either wholly or in part in a local government unit, and when it is suggested in support of the policy of this Bill that no one authority should own the residences of a large number of people, one cannot overlook completely the fact that there are still quite a number of not unimportant villages and small towns which are owned by persons—by ordinary, single persons. I believe it was the case a few years ago that about a third of the city of Cardiff was disposed of by one person. While I am not suggesting that this is a desirable state of affairs, it seems to me to reduce the validity of the argument which is put forward in support of the proposals.

It will still be the case under these proposals that the local authorities will provide the municipal services by themselves. In a rural district they will be provided by the county council, or by the rural district council themselves if they are authorised authorities. They will be provided by the local authorities, as indeed they are now—education, street lighting, maintenance of streets, refuse collection, sewerage, libraries and all the amenities which collectively have created the value of the new towns. Without those amenities the new towns would not have prospered as they have; indeed, they could not have existed without those facilities. Yet we are told that the local authorities which provide those essential facilities and amenities are not to be regarded as capable of managing the new towns.

The growing value of the new towns—and they already have a very substantial increase in value, which would inure to the Treasury—is largely due to the services of local authorities, which have been paid for, partly by ratepayers other than those who are living in the new towns. Those of us who have had any experience of the rateable return of new housing estates or of new towns, or of extended towns, know that for a number of years the rate return of the residences or the shops which are associated with the residences has not been a return equivalent to the cost. Especially is that the case with regard to education.

Now we take the view, the view which was held by the Government when they were in Opposition in 1946, that these new towns should become a part of the local Government structure where they are located, and the tenants should become citizens of that area and as citizens should enjoy rights as tenants protected as citizens from any intended or attempted extortions against them as tenants; and that they should become absorbed in the life and tradition of the local authority. On the other hand, under the proposals of this Bill we are to have a Commission, a kind of remote control. I hesitate to mention the obvious designation "absentee landlord."

I believe that it is anticipated that when the new towns are complete there will be something in the region of 500,000 tenants or people within the twelve new towns in England and Wales. The Commission will not be democratically elected; it is to be appointed. It will not be susceptible to public influence or to the influence of the tenants; there will be no elected representatives. As regards the local committees, they are to be appointed by the Commission, subject to the approval of the Minister. The second paragraph of the First Schedule is, as the noble Earl must admit, very ambiguous as to what the powers of the local committees are to be. I ask, why has there been this change of policy? In 1946 the then Opposition were very anxious that the Treasury should not be permitted to be pernickety and to stop the transfer of these new towns to local authorities. The present Mr. Speaker in another place moved an Amendment in order to prevent the Treasury from delaying the transfer of the new towns at the appropriate stage to local authorities. What has changed the point of view?

One follows the debates on this Bill which have taken place in another place, and there is no indication of what has led the present Government to change its quite definitive, urgent, and insistent point of view in 1946 to what is embodied in this Bill. I know that it has been suggested that there have been twelve years of experience. Now what does that mean? Does it mean that there has been twelve years of experience of the inability of local authorities to manage new towns? Or twelve years during which the local authorities have fallen from grace and capacity? Is that what the Minister means? Has the Minister's opinion of local authorities so fallen that he is now not prepared to hand over to them the responsibilities for managing local towns?

We know, of course, that the present Minister, no doubt representing the views of the Government, is very anxious, so he says, to enhance the powers and the status of local authorities. He wants more devolution, more powers to them; and, in order to secure that, he has appointed two Commissions to inquire into the structure of local Government, and one Royal Commission to do the same. And yet he goes back on what was a Parliamentary decision approved by his Party in 1946, and implies that the local authorities are not capable of managing the new towns if they are handed over to them. My Lords, I suggest that this is a pretty exercise in hypocrisy.

Now there has been recently issued a Report of the Housing Management Sub-Committee of the Central Housing Committee. It is a report on the manage- ment by local councils of their housing estates. The Sub-Committee is, of course, a part of the Central Housing Committee, which is appointed by and responsible to the Minister of Housing and Local Government. What does this Sub-Committee say about the capacity, the ability, of local authorities to manage housing estates?—and, of course, we must always bear in mind that the principal task of managing a new town is managing housing. This Sub-Committee, in its recently issued Report, says: We attach great importance to the essential part which the elected members play, not only in all that concerns the provision of houses, but in ensuring that management is equal to its extended responsibilities That is paragraph 10 of their Report. It then goes on to say: Whatever the form of management, the test should be whether it is both working well and is seen to be so by the community at large. This means that the arrangements should be sufficiently flexible to meet changing conditions and should be examined critically from time to time to see that they continue to do so" (Paragraph 11.) Authorities have the complex task of creating and maintaining, in partnership with statutory, commercial and voluntary agencies, the environment and the conditions in which the life of a new community can flourish" (Paragraph 9.) Now the authorities spoken of there are the local authorities, and I submit, my Lords, that those conditions cannot be achieved with a remote Government agency—impersonal, responsible to nobody; not responsible to local opinion, but responsible only to Whitehall. It can become an outstanding example of bureaucracy, with all the qualities of Bumbledom.

But the Committee to which I have referred went a bit further in its comments. The Report said, as regards the relationship between a local authority and its tenants—which, of course, is the essence of the problem which we are now considering: The relationship between a local authority and its tenants is twofold. There is an ordinary business relationship bound by an agreement, whether implied or direct, and similar to that which exists between the private landlord and his tenants. The second relationship is that between the local authority and the citizen. The essence of good relationship is mutual understanding and confidence. The tenant—not only as a tenant but as a citizen—"— and I stress those words, "but as a citizen"— expects fair and decent treatment from the representative body"— not an appointed body such as the Commission, but the representative body— and, if dissatisfied, can make complaints either individually or collectively to any council member" (paragraph 108); that is to say, can make complaints to his democratically-elected representative. None of those considerations can be expected from the Commission contemplated under this Bill, or from the local committees, who are to be responsible, not to the local representatives, not to the tenants, but first, I suppose, to the Commission which appoints them; and the Commission, in turn, is responsible to the Minister. You have this remote, notional management of houses and of the activities of the new towns.

Then, my Lords, there is another point—and a very important point—which is already occasioning the new towns some very serious thoughts and problems: that is, the situation which is developing of the housing of future generations. The newcomers to the new estates are mostly young. As Lord Taylor said during another discussion in your Lordships' House, the birth-rate is high, and the problem of married sons and daughters will be one to be met over many years. These will be the problems of the district council, because it is the district council and not the new town which is responsible for providing new housing. It seems unreasonable to place this burden upon the district council while leaving the housing estates of the new town free from any such control. For instance, the control of vacancies, and the transfer of tenants which take place in a large housing estate run by a local authority, will not be possible because there will be a plurality of authorities—on the one hand, the local authority, and on the other, the New Town Commission; whereas if the new town were to be transferred to the local authority, there would be one authority dealing with these questions, which already at this early stage have become matters of considerable importance.

There is also the question of the social and financial difficulties of tenants. If they get into such difficulties, they must go to the local authority, which is the authority for dealing with them. It would be much better, I submit, if they could go to the local authority as tenants of the authority. But none of these flexible arrangements, which are so helpful to the management of housing estates, as all who are concerned with such estates know well, will exist if these new towns are to be separately run, as is contemplated, by a separate organisation primarily responsible to Whitehall with notional ineffective local committees—committees of pretence, if I may call them so.

For those reasons, my Lords, we object to this Bill. We are unable to understand yet why what was good doctrine in 1946 is in 1959 a bad doctrine, unless it be that the present Government are a little disturbed at some of the political implications which have emerged from some of the local authorities containing the new towns or adjacent to new towns. We think that Part I of the Bill is bad and that in this respect it is an unworthy Bill and ought not to receive the approval of your Lordships' House. Whilst, in general, it seems that the provisions of the other Parts of the Bill are reasonable, especially the financial proposals, we reserve the right to put down on Committee stage such Amendments as we may think appropriate. But we on this side of your Lordships' House are entirely opposed to Part I of the Bill.

4.4 p.m.

EARL WALDEGRAVE

My Lords, I confess that I was not sanguine enough to believe that I could wholly convince the noble Lord, Lord Silkin, who has told me that it is no discourtesy that he has not been able to remain in the House for what shall be my brief reply. I was extremely interested to hear the noble Lord and the noble Lord, Lord Latham, produce again in your Lordships' House merely the two old arguments which we have had all the way through the discussions on this Bill in another place. Incidentally, I was a little puzzled at one stage about whether the noble Lord, Lord Silkin (I hope he will not mind my saying this when he is not here), was answering the speech of somebody else; for he put a good many words in my mouth that I had not used, though they seemed so reasonable that no doubt they were made by one of my right honourable colleagues. The two arguments brought forward by the noble Lords are those of consistency and of whether or not local authorities ought to own property.

I need not, I think, deploy at any length the arguments about consistency. Thirteen years ago individual members of the Conservative Party, who may or may not be members of the Conservative Government now, may have expressed opinions on the passing of a measure which they may or may not hold to-day when they have the responsibility of Government on their shoulders. As so often stated, it is the privilege of little minds to feel that one can overcome any wrong so long as one is consistent. Up to a point, consistency is an excellent thing, but it must be right to change one's mind when circumstances lead one to do so; and it must be right for the Government of the day, when they consider the course of action that must be taken, not to be bound by what Back-Benchers said thirteen years ago.

LORD LATHAM

My Lords, does the noble Earl regard Mr. W. S. Morrison as a Back-Bencher of those days?

EARL WALDEGRAVE

No, my Lords, not Mr. Morrison. He was not a Back-Bencher at that time. But it is really unprofitable to go into what was said on this point, because consistency is not a very good argument, and I would move to the other point. It is said that we are saying that local authorities ought not to own property. But we envisage three stages in the development of the new towns, in which this Bill represents a second stage, the setting up of a Commission to take over during the intermediate period. We have not said whether or not the local authorities or any other bodies should own the assets or part of the assets of these towns in the remote future. We think it wise to defer that decision. There is no advantage in trying to tie our hands now on that ultimate decision.

The noble Lord, Lord Silkin, brought up a question about finance. He quoted figures and wondered why my right honourable friend quoted the deficiency in 1957–58 for the town of Crawley when he might have quoted the surplus in that year for the town of Harlow. The noble Lord went on to quote various figures, which he gave correctly. It is true to say that Harlow had a surplus on general revenue account in 1957–58. Harlow even had a cumulative surplus on the general revenue account. But we must take the whole picture. Harlow has a cumulative deficit of £754,386 on its ancillary services revenue account, and as all this money has been found by the taxpayer, from the Treasury, I think it would be wholly wrong to wash all that out and simply to take the revenue account and say, "This is a profit". After all, there were special housing subsidies available for these development corporations, and the proceeds of those subsidies are not taken into account in the figures that have been mentioned.

LORD LATHAM

My Lords, may I ask the noble Earl whether the deficiency to which he has referred in regard to Harlow did not principally arise from the fact that Harlow had to provide a sewerage system?

EARL WALDEGRAVE

I think it arose almost entirely from the fact that they had to provide an extensive sewerage system; but it cost the money just the same. It does not seem to me irrelevant to say that part of the development of Harlow was the provision of a sewerage system which has left a deficiency of over £750,000. It is wrong to say that that can be offset by a lesser surplus on some other account. The noble Lord, Lord Silkin, used the word "hypocrisy". We are accused of hypocrisy. He said that we are really meaning this Commission to be the final stage. We have not said that. It is not the final stage. By its very function it is to be an intermediate stage, and the ultimate stage is deferred.

The noble Lord, Lord Latham, said that the First Schedule was ambiguously drawn. I can only say that that is not so. Paragraph 2 (1) of the First Schedule says that the Commission may make arrangements and that is qualified by paragraph 2 (2) which says: It shall be the duty of the Commission to make, in relation to the management of land held by them in any town for the purpose of being let for dwellings, arrangements under this paragraph approved by the Minister. That, I am advised, makes it obligatory on the Minister to set up local committees in connection with the rented dwelling houses.

LORD LATHAM

My Lords, perhaps the noble Earl can assist me in this matter. Paragraph 2 (2) of the First Schedule applies only if the Commission have, under the permissive qualification, not the obligatory qualification, made arrangements for any part of the business in any town to be conducted on behalf of the Commission by a committee consisting partly of persons who are not members or servants of the Commission. Then if they do that, it shall be the duty of the Commission to make arrangements in relation to such provisions as are mentioned in paragraph 2 (2).

EARL WALDEGRAVE

That is so. Perhaps this would be a point which could be more suitably discussed in detail in Committee. However, I can safely stick to my point that the committees for rented houses will, in fact, be delegated to local committees.

LORD LATHAM

That they could be; not will be.

EARL WALDEGRAVE

I am afraid I must disagree and leave that point. On the question of remote control, I tried to meet that point in my opening speech. With this proper delegation of certain functions, the dangers of remote control can be met. What is wanted at this moment is good control and good management, and the centralised management and pooling of resources will give that. There is a good deal of business before the House this afternoon, and I will not delay your Lordships longer. I should like to end by saying this: that though there was a great deal of discussion on this Bill in another place, and rather firm positions were taken up, there was no Division on Third Reading. I commend this Bill to your Lordships for Second Reading and I hope that it may receive your acceptance.

LORD LATHAM

I think it is proper to say that there was no Division in another place on Third Reading because of the acceptable provisions of Parts of the Bill other than Part I.

EARL WALDEGRAVE

A Bill has to be passed as a whole Bill, and not as Parts of a Bill.

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