§ 4.5 p.m.
§ Order of the Day for the Second Reading read.
§ THE PARLIAMENTARY SECRETARY, BOARD OF TRADE (LORD RHODES)
My Lords, I beg to move that this Bill be now read a second time. After the felicitous and charming speeches in the tributes to the noble Marquess, Lord Cholmondeley, and the very sweet reasonableness which has been in evidence during the last Business, I expect noble Lords will find what I have to say a little prosaic; but, at any rate, it will be as brief as I can make it.
This is an important Bill, and it will go a long way to remedy one of the major economic problems of our times. For years those of us who have lived in the North have seen our young people drifting to the South. Noble Lords will probably have observed that "Stop-Go" policies seem to bite deeper in the North than in the South. Office work is regarded as regular work, and the office boom in London has been a very powerful magnet to thousands of our fellow citizens from the North. For ten years this pull has aggravated the problem of imbalance with the rest of the country. From 1953 to 1963, 56 per cent. of the total rise in employment in Great Britain, as a whole, was crammed into the South-East of England, though the area possessed only 35 per cent. of the population. Between the Census years 1951 and 1961, 400,000 new jobs were created in the London conurbation, of which only one-fifth went into manufacturing industry; and in Central London during the same period there was a rise of 200,000, and 150,000 of them were office jobs.
It seems that where you have a concentration, more and more concentration piles on top of it. I am reminded of a family in our village where there were two sons, one small and one big, who were having their dinner. The mother put the meat on the children's plates, and the small son said to the mother: "Why is it our John gets more meat than me?" His mother replied: "He's a bigger lad than thee." And the little 854 lad said: "Aye, and he always will be, if he has more meat." It is illustrative, because this is precisely what has been happening.
The last Government caused the South-East Study to be made, but, apart from noting the problem, nothing effective was done about it. For the speculator there was money in it, and for the speculator there was a Government who believed in laissez-faire. How often in another place, when we warned about the consequences, did we hear: "The play of market forces will resolve this". It did, and through the roof—and with it there was the concentrated human misery in housing. Who among us has read the Milner Holland Report without having his bowels wrung by it? How often have we in the other place listened to the stories of London Members, telling us about the harrowing tales of housing in London?
The loss of population from our constituencies in the North has led to a quite hopeless situation in the London area. The sequence followed by the last Government seems to me to have been: acute problems—deserve a report—deserves a debate—and then forget all about it! How can a local authority find the land for housing without the price sky-rocketing if, at the same time, they are fighting a losing battle with the increase in population? It cannot be done. That is without going into the finer points about the inroads into the Green Belt.
Noble Lords who travel to this House and into Central London know the problem very well. Trains and roads are overcrowded. For ten years there has been an increase of 13,000 a year pouring into London; 1,350,000 people struggle into Central London every morning between the hours of 7.30 a.m. and 10 a.m., and 1,350,000, I suppose, limp out again at night—and when I am going home I always seem to be behind most of them. Whatever the Ministry of Transport has been able to do, the situation seems to get steadily worse. It slows industry down, it creates frustration and misery of all sorts, it contributes towards the blocking and frustration at the docks, and it also affects costs.
The labour shortage in the plethora of office employment means wage drift. Last year, over the country as a whole, wage drift was 2½ per cent. What, then, 855 must be the wage drift in Central London when the employment exchanges have been reporting as many as 5,600 vacancies for female clerical staff? What has it been—3, 4 or5 per cent.? It must have been tremendous.
Then there is the regional imbalance. Before the war, there was 87 million square feet of office space in Central London. Now it is about 124 million square feet. It is estimated that Birmingham have 7 million to 8 million square feet; Manchester, 7 to 8 million square feet; Liverpool, 6 to 7 million square feet; Glasgow, 10 million square feet; and Edinburgh, 7 million square feet. This is one of the important facets of this position. Time and again in this country we have been faced with the dilemma of allowing excessive economic pressure in the South-East, with its bottlenecks, labour shortages and high costs, or of slowing down the economy as a whole, which included under-employment areas like the North-East, North-West and Glasgow, to mention only a few.
I believe that the steps which have been taken to deal with this matter have been quite inadequate. We believe that action had to be taken now. What the late Government did was inadequate. Some action was taken under the existing planning controls. The Location of Offices Bureau was set up in 1963, and here may I pay a tribute to what has been done by that Bureau. They have made a real, serious effort to deal with the job; but how limited they have been. Supposing it had been possible to have more powers and more opportunities, how much suffering and misery would have been averted. Most of the faith that the Opposition had on this matter was that the market forces would take care of it all. It is easy to see, by a cursory study of the figures of the potential office space which is no win the pipeline, how inadequate this was.
The Ministry of Housing and Local Government asked for a report from the planning authorities in the Greater London area at the end of last year which showed this: complete and vacant, 5 million square feet; under construction, 14½, million square feet; outstanding planning permission, 17½ million square feet. If we allow for some of the17½ million square feet being subject 856 to control because the contracts had not been entered into before November 5 last, we can assume that between 25 million and 30 million square feet will be available for use.
§ LORD ERROLL OF HALE
My Lords, may I ask the noble Lord how much office space is going to be pulled down during the same period?
§ LORD RHODES
We will come to that later. I hope some of the old office space is going to be pulled down, because some of it is very poor indeed. Even on the generous basis of 150 square feet per person—
§ LORD DRUMALBYN
My Lords, will the noble Lord forgive me for interrupting because it is right that we should get these figures on the right basis? I am sorry I missed what he said, but could he tell the House again whether he is talking about the Greater London area, the Metropolitan area, Central London, or what?
§ LORD RHODES
I am talking about the Greater London area. Even on the basis of the generous allowance of 150 square feet per person, 200,000 additional office workers will be pouring into London every morning, and if we quietly ask ourselves a question whether this can go on unchecked, all reasonable people will answer, No. This extra office space alone is three times the size of total existing office space in the largest of the regional centres. This ominous figure meant that when we came into office last October we had to act. We did act, and we acted decisively. We made the operative date in November, otherwise a whole spate of building projects would have gone ahead if the announcement of the control had not been accompanied by an operativedate.
The Bill therefore applies the control initially to Greater London and the outer Metropolitan region, which we can roughly define as a 40 mile radius from Charing Cross. The Bill also gives the Board of Trade power to apply control in any other area in Great Britain. The orders will be subject to Affirmative Resolutions. We need this permissive power because, although the immediate objective is to relieve congestion in and around London, it may become necessary in the event of excessive fringe 857 development and in the interest of a better regional balance of office employment throughout the country. We are going to use the industrial development certificate type of control, and we have chosen this because it works. For years we have had experience of I.D.C. It has been accepted and we propose to adopt this type of control. The advantage about it is the link this makes with existing planning authorities and existing planning law. In this connection, it is important to bear in mind that the Bill is an extension of existing planning legislation.
Clause 1 defines the type of office development which will need an office development permit, and also provides that an office development permit must be obtained from the Board of Trade before an application for planning permission is made. The clause also brings within the scope of the control any development of land involving the creation of officepremises—that is, building or rebuilding extensions or alterations and change of use. Clause 2 provides an exemption from the control of small offices. The exemption limit is 3,000 square feet. But, at the same time, we are making quite sure that in this clause what is known as creeping development does not occur through linking small schemes together.
Clause 3 provides that an office development permit is needed for outstanding planning applications for office development in the Metropolitan area on which no decision has been taken before the passing of the Bill. In Greater London, planning permissions granted before the passing of the Bill for new offices over 3,000 square feet are put into suspense, unless the planning permission was obtained before November 5 last, and either the building was completed or a building contract made before that date. Also in the Metropolitan region planning permissions granted after November 4 for any office development are put into suspense unless they are below the exemption limits. We want to keep the formalities as simple as we can, and we want to reduce inconvenience to applicants as much as we can. We are already considering applications for permits informally while the Bill is going through the usual process of being turned into law. We regret any inconvenience that 858 may have been caused to some developers, but we know that many of them realise that it is more than outweighed by the knowledge that we have taken this action in the interests of the nation as a whole.
In Clause 5 we thought it reasonable to exempt from the more severe retrospective control in Greater London, industrial building with ancillary offices for which both planning permission and an I.D.C. were granted before November 5. I am sure noble Lords will agree that this is common sense. The remainder of Part I is largely consequential.
I should like to say a few words on the scope of the second Part of the Bill which deals with factory development. Unlike the first Part of the Bill, it does not introduce a new control; it amends an existing one. Industrial developments of more than 5,000 square feet are already subject to the grant of an industrial development certificate from the Board of Trade. Clause 17 of the Bill provides a measure of flexibility by enabling the Board of Trade to vary the exemption limit (at present fixed at 5,000 square feet for all parts of the country) at any time and in any place. It will thus be possible to set exemption limits appropriate to the differing conditions in the various parts of the country.
It might be asked, "What is the purpose of an exemption limit?" I would say this. The reason we have an exemption limit is to reduce the administrative burden of examining applications, and at the same time to relieve industrialists of the need to obtain Board of Trade approval for trivial building operations. The reasons that have prompted us to take this power to vary the exemption limit are as follows. The House knows that the limit of 5,000 square feet which applies to all parts of the country was chosen when the I.D.C. control was first introduced, because it was then thought that most projects of up to this size offered little choice of location and that they did not individually involve large increases in employment.
It has, however, I am sorry to say, become very apparent that a great deal of industrial building is going on under the 5,000 square feet limit, particularly in the South-East and the Midlands, areas where, because of the excessive pressure on national resources, it is necessary to 859 operate a strict control over industrial expansion. A recent check over a period of twelve months has shown that in the Midlands and the South-East only about 10 per cent. in number of industrial planning permissions were supported by industrial development certificates. It does not need much imagination on anybody's part to know what has been going on.
This situation points clearly to the need for an examination of development which is at present escaping control under the 5,000 square feet exemption limit. Although much of this development probably takes the form of relatively small extensions to existing factories, we know that a good deal of it takes the form of new factory development in small units on speculative estates. We wish to be able to examine all this development, to see whether it is necessary for it to take place in the congested areas, and then, in appropriate cases, to steer it away from these areas of industrial congestion to places where there is a need to provide more employment. That is common sense. But we cannot do this while it remains outside the scope of the industrial development certificate control. It has therefore been necessary to amend the industrial development certificate control so as to enable the Board of Trade to vary the exemption limit in accordance with the requirements of the situation in the different parts of the country.
The limits for the various parts of the country will be laid down by order. Because of the urgent need to deal with the situation in the Midlands and the South-East, the first order, which will be made when the Bill becomes law, will set an exemption limit of 1,000 square feet in the London and South-Eastern, Eastern and Midland Regions of the Board of Trade. The 5,000 square feet limit will continue in all other parts of the country. It might be said, "Why 1,000 square feet?" That question has been asked in another place and in the country. I will try to answer it.
It is admittedly difficult to know just where to draw the line so as to avoid the imposition of vexatious formalities for trivial projects, while at the same time bringing under scrutiny the large amount of development which is taking place in the congested regions under the present 860 5,000 square feet exemption limit. We know that it is possible to start up a new factory with less than 5,000 square feet of industrial floor space. Industrial estates can be built up of these small units, giving employment to large numbers of people. Until we have had some experience of looking at proposed developments of less than 5,000 square feet, we think that it is necessary to set the limit at a figure which will exclude only the very small ones. So we have chosen 1,000 square feet. If experience shows that this is too low, we shall be able to raise it at any time by an amending order.
It may be said, "Why reduce the exemption limit in the whole of the Midlands and the South-East?" We realise, of course, that not all of the Midlands and the South-East is suffering from industrial congestion. Of course it is not. It is not true, for example, of large parts of Norfolk, Suffolk and Cambridgeshire, in the Eastern region; nor of North Staffordshire and parts of Shropshire, in the Midland region. But we have thought it advisable to deal with these regions as a whole because we foresee difficulties and confusion arising from the application of different limits within the areas of responsibility of individual county planning authorities. But we shall naturally administer control at the lower limit with flexibility over these wide areas, varying our attitude in accordance with local conditions.
The introduction of a 1,000 square feet exemption limit in the Midlands and the South-East does not mean that all building above this limit will be prohibited in those areas, any more than building above 5,000 square feet has been prohibited in the past. We shall administer the scheme with common sense. Every application will be considered on its merits, and the needs of individual applicants will be taken fully into account; but we shall look most critically at proposals for the establishment of new undertakings in the more congested parts of the regions concerned. That is our main purpose, to check the establishment of new undertakings in those areas already suffering from industrial congestion, and so far as is possible and reasonable, to restrict the expansion of undertakings already operating in these regions and to divert this industrial growth to places 861 where it is needed and where it can continue to grow healthily without creating inflationary pressures on the economy.
My Lords, I said I would be brief. I do not think I have wasted many words in putting forward the explanation of this Bill. Finally, may I say this? I am sure your Lordships will want to support it. It is socially good, it is economically right, and the sooner it is put on the Statute Book the better. I beg to move.
§ Moved, That the Bill be now read 2a.—(Lord Rhodes.)
§ 4.30 p.m.
§ LORD ERROLL OF HALE
My Lords, the noble Lord who introduced this Bill certainly lived up to his promise to be brief, and as it is the first time I have heard him introduce a Bill in this House I should like to congratulate him on the clear way in which he explained a Bill which is complicated and involved, requiring, as it does, the bringing in of an entirely new class of control, namely, control over office development, and the savage extension of the system of I.D.C. for very small industrial developments.
I wish the Government, on taking office, had looked at the problem a little more carefully before rushing into the legislation provided by this Bill. We all knew there had been a problem about the development of offices, particularly in the London area. The erection of many new buildings in the period of prosperity from 1959 to 1964 was certainly causing an element of congestion. They were bringing a certain amount of additional employment into London and into the South-East. But the real point which I should have liked the Government to study was the extent to which we had already taken steps to solve the problem occasioned by this rapid growth of offices in the London area.
In my submission, we had already solved the problem, because the 1963 Town and Country Planning Act considerably tightened the control and removed the difficulty known as the "Schedule 3 difficulty" from earlier legislation. In co-operation with the local authorities, we had maintained strict control over the areas zoned for offices and over changes to office use from other uses; and we were also giving consideration to the possibility of 862 rezoning some areas at present zoned for office development. Those were the measures we were taking. It was a Conservative Government which set up the Location of Offices Bureau. I was glad to hear the noble Lord pay tribute to it, but I think that if he had studied the matter a little more he would realise how effective it is proving to be. In the first 18 months of its existence it has been consulted by over 800 firms representing some 80,000 jobs, and of these, more than 116 firms, representing 12,000 jobs, have already moved from the Central London area, or will shortly be doing so; and in their first Report the Bureau say that they expect an annual exodus rate of some 20,000 a year for ten years, at present trends.
Furthermore, the Conservative Administration, following the publication of the Fleming Report in July, 1963, aimed to move out some 50,000 of the 130,000 civil servants who were at work in Inner London. There is no doubt that the problem was well on the way to being solved, because the market forces, which I am sorry that the noble Lord. himself a successful industrialist, should have so scorned, were already showing that the boom was over, that rents were going down and that "Offices for sale" notices were going up.
In regard to congestion of transport facilities, the Conservative Government sanctioned the construction work on the Victoria Line, which will not only make it easier for a number of people to get into London than in the past but will substantially ease congestion on other underground and railway lines, and possibly on bus services as well. The effect of the standstill announcement in November, and of the appearance of the Bill, has been to put up rents in the Central London area for office accommodation, in some cases by as much as 10s. per square foot. Vacant blocks which had been advertised for sale have been taken off the market, and in many cases, because of the uncertainties created, there has been a standstill on businesses about to move out.
As the restrictions and control of this Bill become more apparent when it is an Act and it is in working operation, scarcity values will be created—the very sort of values that the present Administration dislike and distrust so much; old 863 and ageing office property will acquire a value out of all proportion to its true worth; rents will rise because of scarcity; and so, in the course of time, we shall have a highly artificial and inflationary system operating in regard to office accommodation in London. Furthermore, much necessary development work will be held up, especially the modernisation of offices to comply with the Shops, Offices and Railway Premises Act of 1963.
Certainly, there had been a problem, which we had solved, but no crisis; and I am sure that if the incoming Government had looked at the matter impartially they would have seen that there was no need for this measure at all. But one has to look at the doctrinal past of the Party which constitute the present Government. They have always disliked new office blocks. They have always felt that the proper work is done in the factory, and that nothing important is being done in offices, except possibly the making of money by stockbrokers. They have disliked particularly the new offices going up in London, in Birmingham and in many other centres. They hate the Shell Centre towering above Labour's beloved County Hall. They like control for control's sake.
I could not help abut notice the way the noble Lord relished the fact that they would be able to control so much. We were promised, of course, that the control would be wisely and humanely administered, but I am sure that the members of the present Administration are highly pleased that, if the Bill is passed, they will be able to exercise so much meddlesome control over the details of office organisation and administration, which will have to be revealed to them in the effort to obtain the necessary office development permits. I was sorry that the noble Lord was comparatively silent on the administrative problems which will be thrown up, and particularly as to how the Department, of which he is a Minister, will administer the stream of applications for office development permits which are bound to come in. He sought to assuage the mood of your Lordships' House by saying that his Department are already dealing informally and sympathetically with applications for permits. But we have heard 864 nothing from him about the criteria to be followed for granting office development permits. Is it to be a tough policy? Did the noble Lord say "Yes"?
§ LORD ERROLL OF HALE
In that case it will be the small man who will be hit, because it is the small man who perhaps wants only a relatively small extension or a new office. He will have all the trouble and difficulty of applying for a permit, which will, I suppose, not be granted. It is the small man who cannot lease a complete building, who perhaps wants only a floor or a few rooms in an office block. The developer who provides the facilities for such people will not be able to say what the office is going to be used for because, until it is built, he cannot obtain the tenants for it. So small men, requiring relatively small amounts of accommodation, will not be able to get it, or, where it is obtainable, will have to pay scarcity values for it. Do not forget, too, the effect on office workers who, because of the growing scarcity of suitable office accommodation in the London area, will find that their desks are being moved ever closer together. On the other hand, were the applications to be granted freely, then there would seem to be no need to go through all the rigmarole of obtaining office development certificates.
The noble Lord was silent on what offices are to be included. In preparation for this debate this afternoon I had naturally turned to the Bill itself, and found that Clause 13 deals with the meaning of "office premises". At page 16 of the Bill it saysoffice premises' means … premises whose sole or principal use is to be use as an office.That gets us a long way further forward! Then, at page 17, as though the Bill were not long enough, we are told that "office premises"means premises falling within either of the following descriptions, that is to say—(a) premises whose sole or principal use is as an office or for office purposes.Perhaps we may come to this a little more fully in Committee.
But what I find as a most serious defect in this matter of definition is the problem of offices within factories, which fall into 865 a special category. They are not office blocks per se; nor can outsiders rent such offices. But as industry becomes more modernised, the trend is towards having more office workers planning production and fewer workers on the shop floor. This is a desirable trend. It means that more office accommodation has to be provided, but with no extension to factory accommodation.
As I understand the Bill, and from what the noble Lord has been kind enough to say to-day, these offices which are part of the production process will nevertheless be subject to the new control. I regard this is as a quite unnecessary interference with the desirable evolution of the modern industrial process. Furthermore the supervisors' offices will presumably be brought into the net. The young designers whom firms are encouraged to employ and to make more use of have all to wait while the rigmarole is gone through for obtaining office development permits to put up a few partitions inside an existing factory building. The definitions given in Clause 13 are very uncertain in regard to an engineering drawing office. They refer, in line 21, to "drawing" as being something which would come into the net, but if engineering drawing offices are to be subject to control I suggest that we should consider the matter carefully in Committee and move the necessary Amendment.
There was another point on which the noble Lord might have said something, and that is the question of compensation. He referred to the need for making an immediate announcement and having retrospective provisions in the Bill. There is some reference to retrospection in Clause 3, but the abruptness with which the stop was put on has meant that a number of people inevitably have incurred expenditure in surveys, architects' fees, and the like which will now be rendered entirely nugatory. There is a strong case for paying compensation. Then in respect of others who have existing sites but have not obtained planning permission, the sites may well be frozen for a temporary period, seven years, with considerable losses to individuals or companies as a result. The fact that they may be well-to-do organisations is no ground for withholding the compensation which I believe will be properly due to them. There is, further, the unhealthy prospect that local authorities may acquire 866 such sites by compulsory purchase orders, because the owners feel that they cannot wait for seven years, before the Act comes to an end, and then, once everything is free again, as it will be, those local authorities will be able to sell such sites for office buildings and make a substantial tax-free profit.
The other Part of the Bill deals, as the noble Lord explained, with industrial development certificates. Here I should like to mention to your Lordships the statement made by Mr. Jay in another place on November 12, 1964, reported in column 1226 of Hansard [Vol. 701], when he announced the policy ofa tougher application of the I.D.C.s on factories being built in the really congested areas".Because I was interested to see how he was carrying out that policy, I asked a Question, which was answered by the noble Lord, Lord Hobson, on April 1, 1965—it is set out in column 1138 of the OFFICIAL REPORT. The noble Lord said:For the London and South-Eastern standard region from November 1, 1964, to January 31, 1965"—two and a half months of which are covered by the period after Mr. Jay had announced his tighter I.D.C. control—no less than70 industrial development certificates were issued for an area of 1.1 million square feet.In a matter of three short months this was the amount of development that the Minister agreed to permit. I was not surprised at that Answer because I was dubious how he could implement a tougher policy, since the policy laid down already under the previous Administration was so tough that certificates were being granted only to those enterprises which could not move and for which there was great need in the congested areas of London and the South-East.
Having discovered, after he made his announcement, that he could not impose a tougher control on I.D.C.s the Minister decided to widen the net by lowering the exemption limit. On the question of control at 5,000 feet, that was just about "wearable". It was the right balance between the large and the small. One of the by-products of the system of I.D.C.s has been, as the noble Lord explained, to enable the Board of Trade to try to persuade firms either to set up new factories in development districts 867 or to move all or part of their production from a congested area to an area of under-employment. But in our experience it was rarely possible to persuade a firm which wanted only 5,000 square feet to move—it just had not the resources. There was probably only one manager, and one could not divide him into two; there were probably only one tool-fitter, and only one accountant. These small entities could not be moved in entirety or in part. Therefore, there could be no question of being able, by lowering the exemption limit to 1,000 square feet; to secure the objectives which the noble Lord outlined to us.
I would remind your Lordships that 1,000 square feet is a small space indeed. I made rough measurements of your Lordships' Chamber, and the area enclosed by the rail surrounding the steps to the Throne represents about 500 square feet. Therefore, twice that area is the area for industrial development which would now be caught by this control—the space for about four lathes, or for one or two racks for stores and spare parts. This means that anybody who wants to put on a small extension to house two or three more machine tools, or to have a small warehouse so that he can have spare parts stacked ready to service goods which he has sent overseas, will have to go along, cap in hand, to overworked Board of Trade officials to obtain the necessary permission in the form of an I.D.C.I cannot see how the officials can possibly refuse the vast majority of these cases. If they are to be refused, the firms will simply be stopped from growing altogether. Once again, as with O.D.P.s, the small man is the one who will be hit.
If the small applications are to be freely granted, as I believe they must be, then why make these permits necessary? Is it so that the Board of Trade will be informed of what is going on—just a "nosey-parkering" attempt to find out what is going on in private business? If I.D.C.s are not freely granted, a great deal of time will be wasted in abortive argument. I know that the noble Lord was at the Board of Trade with the previous Labour Government, and he probably had experience then of the way in which small men fight so fiercely for relatively small I.D.C.s because they mean a great 868 deal to them. Now many more such applications will be fought for. If certificates are withheld there will be a sense of exasperation and, inevitably, a strong temptation to evade the controls.
My experience in regard to L.D.C.s (this would apply equally to O.D.P.s) was that many individuals—most of the small ones, but sometimes the large ones, too—felt most bitterly that there was no right of appeal for the frustrated applicant. It is true that he could put his case up to the Minister. But if he did so, the case came to the Minister with a recommendation from the very official who had rejected the application. It takes a strong Minister always to override his officials, particularly when they are probably carrying out his policy. Then, of course, one can say that the applicant has the right of appeal to his Member of Parliament. The Member of Parliament writes a letter to the Minister and gets back a letter, signed admittedly by the Minister, but in all probability drafted by the official who turned down the application in the first place. There is at present really no means of appealing beyond the Minister.
§ LORD SILKIN
My Lords, in the matter of industrial development certificates there never has been an appeal, and it has worked quite satisfactorily.
§ LORD ERROLL OF HALE
My Lords, I suggest that it worked reasonably well for the larger ones and it was just workable down to 5,000 square feet, but a new situation arises over these large numbers of very small applications.
A new situation arises also in connection with office development permits, which have now been brought in for the first time. That is why I should like to make the suggestion to the noble Lord that the Government should set up an independent appeal tribunal whose decision would be binding on both the applicant and the Minister. I should like to see the Board of Trade publish as soon as possible an exact list of the criteria which applicants must follow, or try to observe, when applying for an office development permit, because it is clear that there is no expertise to go on. As the noble Lord, Lord Silkin, pointed out, I.D.C.s have been with us for many years, and there is a kind of established case law for I.D.C.s which architects and 869 developers have come to understand over the years. But there is no such case law—naturally, there cannot be—in the case of O.D.P.s, and I hope that as soon as possible the Department or the Minister will publish detailed criteria which must be complied with when applications are being sent in.
Earlier this afternoon we had the Report stage of another Bill, and it was interesting to see that Amendments which had been put forward in the Committee stage and not given too good a reception by the noble and learned Lord the Lord Chancellor, were nevertheless accepted. I think I should be less than fair to members of the Government if I did not make plain that we shall certainly table some Amendments on the Committee stage of this Bill, and we shall not be inhibited from re-tabling those which have been extensively discussed in another place if we think that they ought to be reconsidered in your Lordships' presence. I am trying to emulate the noble Lord who introduced the Bill by being brief. There are many other matters to which I should like to refer, but I am sure that my noble friends behind me will fill the gap in my opening remarks. I should like to conclude by telling your Lordships that I do not like this Bill. It will create unnecessary work. It will lead to endless frustration. It will hit hardest the small man in business or in industry. It is a typical piece of Socialist legislation of which we had so much in the dreary years from 1945 to 1951.
§ 4.53 p.m.
§ LORD SILKIN
My Lords, may I first of all compliment my two predecessors on the good fruit which the debate of last Thursday has borne, in that speeches have been cut down beyond what they might otherwise have been? The noble Lord who has just sat down made it quite clear that he did not like the Bill; indeed, from listening to his speech, I do not think he could find a single redeeming feature. His attitude seemed to be that it was wholly unnecessary; it was a piece of control for control's sake; that noble Lords on this side did not like offices; we liked only factories, and all the rest of it. It seems rather odd, therefore, that in another place there was no opposition, either to the Second Reading or to the Third 870 Reading. There were a number of Amendments pressed on Committee, but if noble Lords opposite feel so strongly about this Bill, and if they feel they have done so well in the past that no further action is necessary, one would have expected that that dislike of the Bill would have manifested itself in another place. Honourable Members in another place have shown no reluctance to vote against the Government, and one would have thought that they would take advantage of this Bill to do so.
I want to look at this Bill quite objectively, and I hope that my noble friend will not mind. The present Government are making an attempt, which has been made before, to restrict, in particular, the growth of London. I think the move was first started by Queen Elizabeth I (I am not sure whether King Canute took a hand in it), and there have been many attempts since. Queen Elizabeth I wanted to restrict London to a very narrow area in the City. The London County Council took a hand much later by having a Green Belt around London, but that has not stopped the growth. We have since had the Barlow Commission, which made certain strong recommendations in 1939, we have had the Abercrombie Report, and we have had all sorts of expressions of opinion—strong ones—as to the undesirability of allowing London to grow; and yet it has grown. I can only hope that the Government will have greater success than Queen Elizabeth I and all her illustrious successors.
The fact is that the population of London has grown, is growing and, in my opinion, will continue to grow. London is a most attractive capital city. I have just spent a weekend in Paris, an equally attractive city. That is also growing very rapidly. I think that every capital city in the world is growing at much the same rate as London. By all means let us do what we can to stop the growth, but I doubt whether, unless we can make other parts of the country equally attractive, we shall succeed in stemming the growth of London—at any rate, that growth which comes from immigration into London. But there is another factor—and we have to face it: that even if there were no immigration into London, the population of Greater London would grow in the next fifteen 871 years by something of the order of one million persons. That involves not merely a demand for more housing but a demand for more employment, unless the people who are born in London, and are the children of London parents, are somehow attracted to leave London and go elsewhere; and that is not going to be a very easy proposition. If, however, one takes into account the fact that there will be a certain amount of immigration into London from other parts, as well as from the Commonwealth (and I am not assuming the whole extent of the immigration which the South-East Study makes, but, say, only half of it) it means that in the next fifteen years we may have to face an increase of two million people.
That is not the whole story. Whenever our demographers have attempted to forecast a future population, they have always gone wrong, and they have always underestimated the growth. While I do not think we can make plans on the assumption that on this occasion there is also an under-estimate, on past experience the odds are that the increase in population may well be even greater than is forecast in the South-East Study. That is a factor which we have to face up to, and for which we must allow in providing employment. I recognise that there is a great deal of office accommodation in the pipeline at the present time, but I should like to ask Her Majesty's Government whether they are satisfied that the increase in office accommodation which is in what I and the Minister himself called the pipe-line is sufficient in itself to meet the needs of the increasing population over the next fifteen years or so.
There are two other factors I should like to mention as tending to increase the demand for office accommodation. The first is one that the noble Lord, Lord Erroll of Hale, himself mentioned—and quite rightly. That is, the higher standard of office accommodation which is now required by law, and which will I presume be enforced by Her Majesty's inspectors. There is a great deal of slum office accommodation which ought to be got rid of, and the sooner the better: and a great deal of it is right in the centre of London. Some of the new accommodation that is actually being built is merely replacement. Furthermore, it follows from what I am saying that the area of replacement offices will have to 872 be greater than the area of the existing offices which are being demolished. So some, at any rate, of the new office accommodation which is being provided to-day will go to merely replacing obsolete and even slum office accommodation.
There is one other factor—and this, I think, we must face. I want to read what the South-East Study said on this point. It is the fact that there is a growth in the demand for office accommodation. This is what the Committee say on page 38:The build up of offices in London has been supported by two long term trends. The first is the gradual shift of emphasis from making things to designing and marketing them. As growing mechanisation makes it possible for industry to produce more goods, and more valuable goods, with fewer workers, so more white collar workers are needed in the drawing shop and in the manager's office. A bigger selling organisation is required; advertising, for example, is one of the growth industries.That is the first point. They go on:The second is the tendency for industry to organise itself in larger units; when a certain point is reached, the chances are that the head office will be found in London, rather than in the provincial towns which saw the origin of the component parts of the organisation.My Lords, these are factors which will tend to create a greater demand for office accommodation per unit of population than exists to-day.
I should like to ask my noble friend Lord Champion, who is going to reply, to what extent the Government have taken this into consideration. The noble Lord, Lord Rhodes, in reply to the noble Lord, Lord Erroll of Hale—perhaps a rather hasty reply; I do not know—said that the Government were going to be very tough about granting industrial permits. Is it right that they should be very tough? I hope they will be reasonable, and I hope they will not be tough. I hope they will have regard to the conditions that I have just set out—and I will repeat them: the increase in population, the vital need for improving the condition of our offices and the changing demands that are taking place, with the result that there is an increased demand for office employment. I hope, therefore, that when the Board of Trade are considering an application for a permit they will take these factors into account, and not simply be tough for the sake of being tough. Anybody can say, "No".
873 That is very easy; but one has to act with discretion, and not harmfully to the public interest. This toughness can so easily resolve itself into damaging the economy of the country.
I have said nothing about the export trade, but that is an additional factor which we have to take into account. While we recognise that the large growth in office employment has resulted in traffic congestion and inconvenience generally, in shortage of housing and so on, we must nevertheless have regard to the economy of the country, and I am most anxious that this control should not act in a way which will damage our economy. We have to face the fact, whether we like it or not, that every big concern, every important concern, wants to have its headquarters in London. It may be that they can deal with much of their routine work outside, and that is a matter for negotiation; but they all want to have headquarters in London, and it is important that they should have, because people coming from abroad and from other places to do business with them do not want to go to some place in Norfolk, which is most inaccessible, in order to meet the heads of the concern. They want to go to a place which is central.
Now I would refer to another fact which the noble Lord, Lord Erroll of Hale, mentioned, and with which I completely agree. One of the effects of this Bill has already been to create an artificial shortage of office accommodation. Offices on the outskirts of London which were very largely unoccupied have either been let or, as the noble Lord said, withdrawn from letting, and considerably higher rents are being demanded. We are in fact tending to create an artificial shortage and a virtual monopoly in office accommodation. Already I can support the figure the noble Lord mentioned, in that, certainly in the area around which my own offices are, Pall Mall, the rents have increased by, in some cases, as much as 10s. a foot. It would be an extraordinary result if, whereas under the Tory Government there were empty offices which could not be let at lower rents, the advent of a Labour Government should fill these offices at very much higher rents. I could have hoped that that would be foreseen, and that at any rate some 874 restriction on rents would be incorporated in the Bill. After all, we are not unaccustomed to controlling rents. We do so under the Landlord and Tenant Act when a lease has expired; and it would not have been unduly difficult to provide that, where exorbitant rents are being asked or charged, there should be access to some tribunal for the purpose of providing for a reasonable rent.
There is one other point I want to mention before I close, and that is the fact that this Bill is negative; it is restrictive. I accept the need for something of this kind temporarily; but I would have hoped that alongside this we should be doing very much more than is at present being done to discourage immigration into London by making other areas far more attractive, not merely from the point of view of employment but also from the point of view of the ordinary citizen living there.
I am thinking of places where the housewife, if taken there, would say that she would like to live there—and there are very few places of that kind just outside London to-day. I visited one of our new towns, Harlow, yesterday and I felt that that was the kind of place where, if you took an ordinary housewife and asked her how she would like to live there, she might probably be attracted. At any rate the town has grown from 1,500 to 71,000 over a short period of years. But if we are thinking of the areas in the North where there is considerable unemployment and where we want to attract people, we ought to try to attract industry. We must make it attractive to the industrialist's wife and to the workers who will be imported there. I would hope something more would be done than merely the erection of a certain number of new factories.
As regards industrial development certificates, it is not in the Bill but I imagine that we shall have the opportunity of commenting on the Order when it is published as to whether it is right that we should come down to as little as 1,000 feet. My noble friend put the argument that we can always raise the figure if we find that experience dictates it; but, in fact, what he is asking is that every single piece of industrial development should now require an I.D.C. That is really 875 what it amounts to in those cases where you come down to 1,000 feet.
§ LORD MOLSON
My Lords, may I interrupt the noble Lord at this point? Am I right in thinking that the procedure concerned is that of a Negative Resolution? Therefore, I do not think there would be an opportunity for the House to discuss an Order made under this Bill unless there were a Motion to reject it? I make that point because I think it is of some importance.
§ LORD SILKIN
One can discuss it and one can reject it. The purpose of a Negative Resolution is that it can be rejected by the House. I think that in practice the result is the same and that in both cases we can discuss it. One cannot amend an Order in any way. One must take it or leave it.
However, I would hope myself that the Government would reconsider this question of coming down to a figure as low as 1,000 feet which is really equivalent to saying that they are going to control every piece of industrial extension in those areas where control is operated. The Bill provides that, unless Parliament otherwise decides, it will come to an end at the end of seven years. I take it that Parliament could decide under this Bill (and I should be glad if my noble friend could give some guidance on this) that it should continue longer. It could cut both ways. Parliament can decide at the end of two years that this Bill should be in operation for more than seven years. I would hope that the period would be somewhat shorter, so that we could see how we were getting on without the necessity for Parliament to intervene. I would hope that we could cut down this period of seven years to something like four or five years, but that is a point that can be raised in Committee.
I think this is a necessary Bill. I am afraid, from my own point of view, it is a regrettable necessity but it is a necessary Bill, and, while it will require considerable examination in Committee, I hope the House will give it a Second Reading.
§ 5.15 p.m.
My Lords, I do not propose to follow the noble Lord. Lord Silkin, in the wider considerations he has 876 put forward regarding the growth of London, though I am sure that much of what he said is absolutely true. I want to speak on one particular aspect of this Bill. I think that most of us who have had anything to do with town planning were hoping that some measure of control would be introduced. In fact I must confess that, perhaps from ignorance, I often wondered by the London County Council themselves had not done a good deal more to restrict office growth under their town planning powers. I am aware that to do so comprehensively would have involved them in a great deal of compensation, but I still believe that they could have done much more than they have done without paying any compensation at all. I may be wrong; I stand open to correction: but that is what I believe.
On the whole, I welcome this Bill; but it seems to me that, now we are to have control, we are to have it with a considerable vengeance. The Bill seems designed to give the Minister complete power to give or to withhold permission to build an office anywhere, on principles that he need not disclose, without appeal and with very limited liability for compensation. These are very formidable powers. Moveover, it further seems that the objects of the Bill are two-fold. One of them is, as I understand it, to disperse offices from the centre of London. That is a conception which is familiar to us all, because it led to the setting up of the Location of Offices Bureau. The other is a much wider and vaguer objective. It is to discourage offices in the whole of the South-East of England, with the object of encouraging them elsewhere.
Because these powers are so formidable and because some of the objectives are vague, I feel that we ought to have a more complete explanation of Ministerial policy than we have had hitherto. In asking for this I am not speaking as a speculator or as a developer, and I am not even—like so many noble Lords on either side of the House—connected with property development. I am simply asking for this from one point of view only: the point of view of the local planning authority.
The procedure of this Bill is bound up with planning procedure and, I think, rightly so. Before an office can be built, 877 as we have been told, two permits must be granted: a planning permit and a Board of Trade permit. So it is possible for the Minister to stultify a town planning scheme; it is possible for a local planning authority, if not to stultify the Minister, at least to stultify a particular O.D.P. It is possible, but obviously undesirable. Common sense seems to dictate that the local planning authority and the Board of Trade should work as closely as possible together. I suggest that common sense also dictates that we in the local planning world should have enough advance information to enable us to prepare or to revise our development plan and town map, with a view to our feeling that when they are submitted to the Ministry for approval they will not come back so amended that they will have to be recast all over again. It is a somewhat lengthy proceeding, preparing these development plans and town maps. In particular, I hope that a scheme of comprehensive redevelopment, involving as it does an even longer and more complex and more detailed procedure, will not be torpedoed at the last minute by a ministerial decision not to afford an office development certificate to a firm with which we might have been negotiating.
These may sound reasonable requests, and indeed I hope they will be so considered; but I shall be very surprised if they are met. There is a long and healthy tradition in local government that we should co-operate with the Government of the day, whatever complexion that Government may have; but in my experience, which is now getting rather long, one of our greatest difficulties is to discover what the policy of the Government of the day is, at least in sufficient detail to avoid our getting some very nasty shocks. There are various reasons for this. Any Minister of Housing and Local Government is apt to remind us that he has a judicial as well as an administrative function, and if his guidance is too definite it might tend to prejudice his position in the case of an appeal. Any President of the Board of Trade has in the past been apt to think that the issue of an I.D.C. must depend on conditions prevailing at a particular moment, and, of course, if there is a change of Government any Minister seems to feel at complete liberty 878 to scrap the policy of his predecessor and to start something new.
For these reasons Whitehall policy over a number of years tends to become somewhat obscure, something which one has to discover by a process of trial and error; but when we do discover what it is, it tends to emerge as something pretty tortuous. One sometimes feels—and I say this in the presence of noble Lords on my own side of the House who have been Ministers—that Ministers are all in favour of long-term planning, providing it does not apply to them.
Perhaps I could illustrate my problem by producing quite a small instance of what is actually happening to-day. I do not expect the noble Lord to deal with it in detail, but I think it illustrates the sort of thing that is arising over a wide area. Some weeks ago a newly-constituted river board in my County of Sussex wanted, as a matter of urgency, to construct some offices. They selected as the location of these offices a small town called Burgess Hill, which is on the outskirts of the metropolitan area as defined in the Bill. In conformity with the White Paper issued before the Act came into force, they applied to the Board of Trade for permission. They got the consent, but attached to it was a number of conditions, one of which was that they could only regard it as a temporary consent. They could have occupation of their offices for only a temporary period, and there was no guarantee whatever that they would be allowed to continue in occupation of those offices permanently. Various suggestions were made as to exactly where they could go in the vicinity.
What are we to make of that kind of decision? The assumption is that henceforth the control of offices in Burgess Hill will be exceedingly rigorous. In some ways this is peculiar, because, being on the outskirts, five miles further to the South there is no control and we can have as many offices as we like. I know these lines of demarcation tend to produce anomalies, but it is rather difficult to see the logic when one is living in the locality.
I should like to make one further point in regard to this case. It so happens that two years ago I, as the chairman of a 879 local planning authority committee, deemed it my duty to visit the Location of Industries Bureau with a view to persuading offices to migrate from London to Burgess Hill. It seemed to conform with the policy of the then Government, and we thought it might do something to relieve the serious commuter traffic problem that exists at this point. The chairman agreed it was a very suitable place for those offices, and accordingly we prepared plans for a town centre, including offices. What will happen to this plan I have not the slightest idea. I am not asking the Minister to tell me now. I am simply using this little story as an illustration. I am quite aware that the Bill has not yet finished its course in Parliament; I am quite aware that the South-East Study has not yet been reviewed; I am quite aware that the regional economic councils have not yet been set up in South-East England, and I am quite aware that the Land Bill has not vet been presented to Parliament. It may be when all these things have been done we shall be a lot clearer than we are at present. Or, my Lords, we may not be.
When the noble Lord, Lord Silkin, started his New Towns plan, in some extraordinary way he managed to get his colleagues to agree to perfectly definite long-term commitments in regard to housing, roads, the movement of industry and finance; and because he managed to get all those definite commitments to the long-term scheme, he was able to hand over to the development corporations, and they were able not only to plan in great detail what the New Towns were to be but actually to build them. They have been a very great success, and I think only because the noble Lord was able to do all those things. I wonder how he would have fared if one of his colleagues had said, "Of course, you cannot expect me to commit myself to anything definite, but I can assure you that if the application reaches me I shall treat it with the greatest possible sympathy and having regard to the national interest involved. You know from your own experience that all Cabinet Ministers are in complete harmony in every matter, so you need have no fear that one will say one thing and one another." I wonder where those New Towns would have got to? I do not think they would have got very far.
880 I wish in our humbler schemes we could get some of this guaranteed and definite sense of purpose that Lord Silkin enjoyed with his New Towns. If, on the other hand, there is to be no continuity in policy, if every Minister is to be a law unto himself, particularly after a change of Government, if it is all right to have offices one year and all wrong the next—and, incidentally, industries too, which are quite important when preparing plans—we shall get a national planning policy which will be about as predictable as the movements of a grasshopper. Long-term plans will be more and more what they tend to be at present, a mere paper exercise without any real significance whatever. I think that would be a pity.
§ 5.30 p.m.
§ LORD MOLSON
My Lords, I cordially welcome this Bill—I could not do otherwise without being entirely inconsistent with a number of speeches that I have made. I ventured to raise a debate on November 28, 1962, regarding the drift of population and industry to the South, and especially the invasion of London, largely due to the increasing number and size of offices. As long ago as that, I was able to quote a large number of publications dealing with this matter. Some came from the political Parties, including one published by the Conservative Party. There was the remarkable Report by the Civic Trust, which was produced by a Committee over which my noble friend Lord Mancroft presided. There was The Paper Metropolis, sponsored by the Town and Country Planning Association, and a number of others.
At that time there seemed to be a considerable measure of agreement among all those who had studied the problem that some deliberate and forceful policy was needed in order to prevent increased concentration of employment in London. This increase in the number of jobs in London was taking place simultaneously with the departure of people to live outside. Therefore, we had this ever-increasing commuter problem, of a great tidal wave coming in in the morning and the same tidal wave going out the same evening. Since then, there has been the setting up, by the 881 spontaneous action of planning authorities in and around London, of the Standing Conference on London Regional Planning, and they are fortunate in having my right honourable friend Sir Richard Nugent to preside over them. They have produced a number of remarkable independent reports, some dealing with policy and some of a more technical kind, and have continued to produce these down to the present time. They have especially emphasised the need to deal with this problem of offices.
The late Government became convinced that something should be done, and they produced a White Paper, London—Employment, Housing, Land. In paragraph 19 of that White Paper they said:The Government intend to make the planning control over new office buildings still more effective".I said then that I thought the steps they indicated were inadequate, and that seemed to be the view of the Standing Conference on London Regional Planning. Therefore, I find that I cannot agree with the views expressed by my noble friend Lord Erroll of Hale, when he says that this problem was well on the way to being solved at the time when the last Government went out of office.
The ever-increasing problem of commuters, the ever-increasing number of offices which are likely to be occupied over the next few years, prove conclusively that, bad as the evil is at the present time, it is going to get worse. In spite of this Bill, which I welcome, it is likely to go on getting worse for the next ten years. We know that, although the standstill has now been applied as from November 4-5 of last year, even the offices that are already in the pipe-line, those which will not be caught by even the retrospective operation of this Bill, will result (and I apologise if I am repeating the figures given by the noble Lord who introduced the Bill) in from 25 to 30 million square feet being built, which will mean, in turn, 200,000 more commuters. This probably means that, each year for the next ten years there will be an increase of some 20,000 in the number of commuters coming into London.
The present state of our roads morning and evening is pretty unsatisfactory. This is the result of 1⅓ million commuters coming in. Not more than one-seventh of them are at present using motor cars, but 882 the proportion may well increase, if the prosperity of the country continues to increase.
§ LORD SILKIN
My Lords, the noble Lord keeps on talking about commuters, but is it essential that these additional workers should all live out of London? Is it not possible to provide accommodation in London?
§ LORD MOLSON
My Lords, I am most anxious that everything shall be done to provide additional accommodation in London. I think that one of the minor, and perhaps indirect, beneficial effects of this measure will be that, as a result of the standstill on office building, more labour and material and land will become available for housing accommodation, as opposed to offices. But this figure of an extra 200,000 commuters, on top of the ⅓ million we have at the present time, obviously indicates the gravity of the problem which we shall have to face over the next few years. And it is largely on these figures that I find myself obliged to dissent from the view expressed by my noble friend, that the problem was on the way to being solved at the time the last Government went out of power.
In addition to the large number of offices which are in the pipe-line, and which will not be caught even by the retrospective operation of this Bill, it is important to remember that, with every increase in the size of London, it becomes an ever more powerful magnet for what I might call the ancillary services—shops, garages, entertainments of every kind. All these are drawn into London increasingly by the increase in the population.
The standstill has caused a large backlog of applications, which I believe are now sitting on the desks of the officials in the Board of Trade. All these point to the need for very great firmness in the administration of this Bill. The President of the Board of Trade, speaking in another place, referred to the minor but important benefits which might result from this in relieving the burden upon the building industry in the South-East of England. I think that it will help with housing; it will help with exports, and, above all, it will help with what I am not ashamed to say I advocate—that is, a considerable measure of deflation, especially in the over-congested areas of South-East England.
883 I hope that it may be possible for the noble Lord, Lord Champion, when he comes to reply, to give some indication of the criteria which will be applied by the Board of Trade in giving their office development certificates. We have had a certain indication of the spirit from the President of the Board of Trade. He said, in another place:… if we are serious about planning at all we must be resolute in applying this control. Applicants, therefore, will have to satisfy us, first, that the activity cannot be carried on elsewhere and that no suitable alternative accommodation can be found, and, secondly,"—I want to emphasise the word "and"—they are not alternative conditions; both have to be satisfied—unless the project is so small that it would not add materially to congestion or pressure on labour in the location proposed. it is essential in the public interest. Mere inconvenience or extra cost cannot be accepted as grounds for granting permits."—[OFFICIAL REPORT. Commons, Vol. 705 (No. 47), col. 739; February 1, 1965.]I regard that as being a promise that the President of the Board of Trade has made, and I hope—indeed. I am confident—that it will be fulfilled. I was glad indeed to hear the noble Lord, Lord Rhodes, intervene a few minutes ago to say that the administration of this Bill will be tough—I think that that is what he said.
I want to ask the noble Lord, Lord Champion, about the Third Schedule to the Town and Country Planning Act. The Act, which was passed by the late Conservative Government after and as a result of the White Paper, London Employment, Housing and Land, made an amendment in the Third Schedule to the Town and Country Planning Act. It was pointed out in the White Paper that when anyone rebuilt a building, or added to it, he could add 10 per cent. to the cubic area, and if planning permission to do so were refused, the local authority might be obliged to pay compensation.
Under the Act of 1963, the cubic content was replaced by superficial area. That was of great importance, because owing to new developments in the designing of offices, and so on, an increase of 10 per cent. in the cubic area might result in an increase of something like 40 per cent. in the number of people employed. I thought that this was a 884 time to do away completely with the 10 per cent. tolerance, and I moved an Amendment in the Committee stage here to that effect, so that rebuilding could be only of the same floor space as the existing building. I remember that the noble Lord, Lord Silkin, while unable to support me in what I proposed, said that if it applied only to offices in London he would be disposed to support it. An Amendment similar to this had been moved by the Labour Party in the other place in the Committee stage of that Bill. Naturally, I had hoped that when this Bill was introduced to deal with offices in London, an Amendment which I had put forward here and which, indeed, had originally been moved at an earlier stage by the Opposition in the other place, might have found a place in it. I should like to ask the noble Lord, Lord Champion, whether he can deal with that point in his reply.
My Lords, may interrupt my noble friend on a point of explanation? I understand him to be saying at the moment that his Amendment dealt with the question of floor space, whereas my recollection—it may be faulty—is that at the time it was dealing with cubic capacity. Is he quite certain which it is?
§ LORD MOLSON
I am obliged to my noble friend. Under the law as it was at the time when the Conservative Government introduced their White Paper, it was cubic content. In their White Paper, and in the Bill which they introduced afterwards, they did away with cubic content and substituted superficial area. I thought this did not go far enough, and that while we were amending the Town and Country Planning Act, 1947, as consolidated in 1962, the whole of this might be done away with. I would agree with the noble Lord, Lord Silkin, that, for lack of anything better, this might well be done in the case of London, even if it were not done in the case of the country as a whole. I am now saying to the Government that as they were in favour of going further in 1963, I wonder why it is, now that they are legislating in order to deal with this matter, they have not carried this further.
It may be that this point is covered by what the President of the Board of 885 Trade said on February 1 when introducing the Bill. He then said:We should have to be sure that this would not expand employment"—that is, as a condition of giving an office development certificate—and the applicants would have to give up the Third Schedule rights, inherited from past legislation, which have so aggravated the present congestion. In some cases the applicant would have to accept a reduction in office space."—[OFFICIAL REPORT, Commons, Vol. 705 (No. 47), col. 739, February 1, 1965.]Does that mean that under this Bill it will be possible, as a condition of granting the certificate, that the rights existing under the Town and Country Planning Act, 1962, will have to be abandoned?
I also welcome Part II of this Bill. I am sure it is important that control should not be too narrow and too detailed, but it may well be that 50,000 square feet is too high an exemption limit to apply in the busy, congested, industrial areas of the country. But I hope—this is a point that has been put to me, and I would ask for an assurance on it from the noble Lord, Lord Champion—that this increased strictness of control will not prevent old, inconvenient and insanitary offices in the industrial areas from being rebuilt in a more satisfactory and up-to-date way.
I believe that this Bill is necessary, and is overdue. I think that in general outline it is entirely right; but I hope that the Government will show a willingness to consider Amendments on the Committee stage, and that in their administration of it, while being firm to establish the principles they have laid down, they will show the necessary flexibility in order that it shall not handicap industry.
§ 5.47 p.m.
VISCOUNT ST. DAVIDS
My Lords, it has been most interesting to me, sitting here listening to this debate, to find myself agreeing in large measure with noble Lords opposite, and particularly with the noble Viscount, Lord Gage, and with much of what was said by the noble Lord, Lord Molson. However, what staggered and horrified me was that the Conservative Party seemed to have another policy different from that of the noble Lords, which was enunciated from their Front Bench.
I listened to the noble Lord, Lord Erroll of Hale, and I was surprised, as 886 I think every noble Lord in the House was, by his statement that when the last Administration went out of office they were then convinced that matters were starting to get better. I do not believe that to be true. I agree with the noble Lord, Lord Molson, that we are still many years from seeing matters getting better. It is clear that they will get worse, as I believe he suggested, for another ten years; and it is not yet certain that even this Bill is going to turn the tide. How on earth the noble Lord, Lord Erroll of Hale, managed to think that the position had been dealt with, I just do not know.
I find this contrary even to what the Conservative Party said during the General Election. I spent a lot of time during the General Election, as I am sure many noble Lords did, going round and speaking for various candidates for Parliament. In particular, I was speaking in Devon and Cornwall. It was there stated—as indeed I know it was in my own native Wales; and, I am sure, in many other parts of the country—not only by the Labour candidates, but by Conservatives and by Liberals, as well, that they were all greatly in favour of bringing more industry, more housing, more of the activity of production and of the good things of living away from the London area and spreading them around the country, thus making not only the London area but the whole of the country equally fit to live in. This, I heard at meeting after meeting, by all political Parties, was their stated policy, and this obviously could be done only by legislation. I do not say that this Bill is the total of the legislation that is needed—in fact, I believe it to be only the start. But how any political Party could say that no further legislation was needed for this purpose I cannot understand. It seems to be contrary not only to common sense, but to already stated policy.
I do not wish to speak for very long. All I would say is that this is not a problem only of the London area. The overcrowding is London's part of the problem, but the problem for the other parts of Britain is the disuse and misuse of their manpower, their existing facilities and the taking of people away from homes of which they are fond and where they have been brought up, simply to 887 stuff them into this already overcrowded corner of Britain. This Bill is notably a Bill for London and about London, but it does good to the whole of the country, and not only London. For that reason, I strongly support it, and I believe that every noble Lord here should do the same.
§ 5.52 p.m.
§ LORD SOMERS
My Lords, I will not keep your Lordships for more than a moment. My noble friend Lord Molson referred to the "tidal wave" of commuter traffic which goes in and out of London, and I entirely agree with him that the tidal wave at the moment moves as though it were made of very thick black treacle. If, as he says, the prosperity of the country improves, it will soon be moving with about the speed of a glacier. I have once or twice in your Lordships' House made a suggestion which has not received a great deal of attention, and I should be most grateful if the noble Lord, Lord Champion (I am sorry to see that he is not here to hear what I am saying), would give me an answer to it.
I have felt for a long time that the solution might be to convert these large office blocks in London into half office and half residential flats, the flats to be tied with the jobs in the office. That, of course, would eliminate altogether the commuter traffic to those particular offices, because the ideal thing is to have the worker living on the spot where he works. I cannot see why such a scheme would not be workable. In these new very spacious office blocks—I cannot say beautiful ones, but very spacious ones—which have recently gone up in London the flats could be made extremely nice, and I cannot see that any worker would have the slightest reason for grumbling about them.
§ LORD SILKIN
Is the noble Lord suggesting that these flats should be tied flats, so that when a person leaves a job he would have to leave the flat?
§ LORD SOMERS
Yes, my Lords; I was suggesting that. That is the case with a great many jobs, and I do not think it is an undue hardship. I should be very glad to hear what are the objections, if any, to this scheme, and whether it would be possible to put it into operation.
§ 5.54 p.m.
My Lords, I apologise for intervening when I am not on the list of speakers, but I should like to support my noble friend Lord Molson in all that he said. I should like to outline one aspect of the problem which has not been touched upon a great deal, and that is the urgent necessity of converting a great deal of London back to residential dwelling. That, at the moment, is financially quite impossible, because the building trade have not yet discovered how to build houses, even on land which is given to it free, at such a price that people in the lower middle income groups can afford to rent those houses. That is the great problem. It is a very difficult one to solve, and it is beyond my capabilities to suggest a solution.
The other thing about which I should like to inquire, which emerges from this, is how our old friend the railway lands are getting on. The noble Lord, Lord Conesford, myself, and one or two others, have conducted a campaign in this House to make the railways disgorge their lands which they no longer require. Gradually, the land is being disgorged, but one would like to see a Report from time to time on the purpose for which it is proposed these lands should be used. The whole object of our exercise has been to get these lands for residential purposes, and one would like to know whether our efforts have met with any success. Perhaps the noble Lord, Lord Champion, in his reply could let me know.
§ 5.56 p.m.
My Lords, I want to ask for a little clarification on the question of the 10 per cent. increase in floor area. My difficulty in understanding this arises because, if you are redeveloping an old building by substituting a modern and well-designed one, it is extremely difficult not to increase the accommodation in the new building by at least 10 per cent. The mere difference in thicknesses between walls of modern design and those of stone or brick and mortar design in itself quite often goes far towards creating an increase of 10 per cent. If you use the site economically out to the existing building lines—and, after all, we want economy in building as well as all these other desirable things—I do not see how in many cases 889 you can avoid an increase of 10 per cent.—more in some cases. One would have thought that the increase in accommodation could be a matter decided for the individual site. I should like to know how Her Majesty's Government view that fact.
§ 5.58 p.m.
§ LORD DRUMALBYN
My Lords, in what is a comparatively short debate we seem to have covered an extraordinary amount of ground. I do not wish to take up all the points. I do not know whether the noble Lord, Lord Champion, when he replies to the debate will attempt to do so. I wish him luck. I do not propose to deal with the various points that have been raised, and which can probably be raised better on Committee—for example, the question that my noble friend Lord Erroll of Hale raised on whether there should be an appeal against a refusal of an office development permit, and the rather important question of compensation. I have a feeling that this goes to the heart of the question my noble friend Lord Somers asked, about the alteration or change of use from office building to residential accommodation. If the use is to be restricted back to housing, then there will be a very serious loss indeed of development value. This, I think, goes to the heart of that problem. Nor do I propose to deal with the question of the definition of offices, which again, I think, is a question with which we can deal on Committee stage.
The noble Lord, Lord Silkin, described this as a negative Bill. I would go further and say that it is a distressingly negative Bill, to deal with a situation which has been recognised by all Parties and was well set out in the White Paper, London—Employment, Housing, Land (Cmnd. 1952), presented in February, 1963. I think the noble Lord, Lord Rhodes will agree, to be quite fair, that certain action was taken on that Report. I do not think it can be said that nothing was done. Moreover, the results of the South-East Study, which was announced in that White Paper, were published only in February 1964, so that there was not much time for legislative action, if legislative action was required, to be taken between that time and the General Election.
I should like to deal first with the industrial development certificates, 890 about which the noble Lord, Lord Rhodes, said a good deal. My reason for speaking in this debate, I suppose, was that I had for two years to deal with industrial development certificates at the Board of Trade under the direction of, among others, my noble friend Lord Erroll of Hale, and 1 think I can claim at any rate a little knowledge about the factors involved.
The noble Lord referred to the intention, already announced and referred to in another place, to reduce the limit from 5,000 square feet to 1,000 square feet, I think he said in broad terms, in the Midland Region and in the Board of Trade South-Eastern Region. The question here, of course, is what is the right limit to which to reduce the level. The difficulties to be overcome are the fact that undoubtedly there has been a good deal of evasion of the control through the building on industrial estates of units which would subsequently link up to form bigger factories, and also that there has been a certain amount of what might be described as creeping development in already established factories, where increases of 5,000 square feet at a time have been made and in the end a very substantial addition has emerged. Those are two problems which ought to be dealt with.
I should hope that, in dealing with the problem as a whole, the Board of Trade would not be inclined in the ordinary way to refuse development certificates for the construction of factories of under 5,000 square feet, because, as my noble friend Lord Erroll of Hale said, these factories are generally extremely difficult to direct elsewhere. The Board may be able to suggest that a start should be made elsewhere with a view to the factory's growing up and, sooner or later, becoming a much bigger enterprise than could be accommodated in the London area (or in the metropolitan area for that matter), and for which the Board of Trade would not give further development certificates.
Whether 1,000 square feet is the right limit or not—and as my noble friend has said, it is a very small amount indeed—is something that we can discuss in Committee, and if the Committee were to think that a figure rather higher than 1,000 square feet should be the minimum, then no doubt that could be written into 891 the Bill. Let us discuss it. I am bound to say that I think this would be a sensible Amendment to introduce. Clause 18 deals with another problem which has given the Board of Trade a number of headaches "for quite a time; but it is a subject on which it would not have been practicable for the Board alone to introduce legislation, and that is why it had to be tagged on to this Bill.
May I turn to Part I of the Bill, which, of course, is by far and away the most important part of it? May I say to the noble Lord, Lord Silkin, and the noble Viscount, Lord St. Davids, that there really is no dispute about the general objectives? We all want to see more offices moving out of London, and, where possible, well away from London. We all want to see office employment provided for the new communities and the expanding towns within reach of London. And we all want to see more offices, whether Government or public corporation or private, going to those parts of the country which have unemployment and migration problems. But what we have to examine, surely, is the method proposed in this legislation and the way in which that method is going to be implemented. In our view, the Socialist outlook suffers from a chronic defect; and that is the tendency to tell someone to "Go upstairs and see what little Johnny is doing, and tell him not to".
In the White Paper of 1963 we expressed our disbelief in this as a means of restraining office development in London. We said that we did not believe thatit would be practical to administer a system of control of office occupation either effectively or equitably.Now, why is that? Very briefly, it is because, unlike factories (other than, perhaps, Government advance factories and small factories on private estates), offices in London are not usually made to measure unless they form part of a factory. The developer often does not know who his tenants will be, so that it is quite impossible to judge whether it is desirable in the national interest that their activities should be carried out in one place rather than another. As the White Paper said:A Government Department trying to administer a control of this sort would therefore he without the basic information needed for the purpose.892 The essential thing for the efficiency of the economy is that in general activities should not be prevented from being located where they can best be done. I do not think noble Lords will object to that proposition in general. But the difficulty we are up against is that the Government will not have the information necessary to make a decision on the particular activities. All they can decide is whether or not the space should be there in cases of that kind.
In 1959 the President of the Board of Trade, on the other hand, expressed his belief in—and I quote:just as tight a national control over office development as over factory development".That was said on November 9, 1959. But when it came to the point, he had to modify his zeal for national control, and has had to be content with a control limited, at least for the time being, to the metropolitan area. What we are entitled to ask is, how he proposes to implement control, and how the Bill is going to be implemented. During the passage of the Bill in another place the President said that the Governmentcertainly does not contemplate that there will be no further office building in London".And he said it more than once. But that does not take us very far; because, as the noble Lord, Lord Silkin, said, it would be absurd to stop all replacement.
Take offices to let. The Board of Trade attempt to steer applicants for industrial development certificates in London to areas of labour shortage in other parts of the country. But the applicant for an office development permit will have his money tied up in a valuable site in London and will not be willing, and often will not be able, to go elsewhere. In a case like that, there really is no scope for steering people; but the great usefulness of the industrial development control, from the Board of Trade point of view, is mainly in this ability to steer. This is the comparison between the industrial development certificate and the office development permit, if there is one. Of course, there might be a little "horse-trading". The Board of Trade might say, "You build an office at Newbury"—or Bletchley or Newcastle or Southampton, or even Livingston—"and we will give you permission to build in London." Or the applicant may wish to 893 modernise. There is no scope whatsoever for steering there.
Take, again, offices which the applicant wishes to occupy himself. That, I take it, is the minority of cases in London, because most firms are tenants, either by choice or by necessity. No doubt the Board of Trade will have the opportunity to try to persuade the applicant to go elsewhere, and, of course, I agree that it is the opportunity which is valuable in the certificate procedure. But as the White Paper of 1963 said:The disadvantages of congestion at the centre are only too obvious in terms of rising costs and loss of time both to employers and staff".In other words, the advantages of better working conditions outside, and cheaper costs, are already being recognised more and more.
Before the applicant applies for an office development certificate he will have consulted the Location of Offices Bureau. He will already have taken into account the advantages of moving out, and he will have concluded that they are outweighed by the disadvantages for his business—I am talking of one who applies for an office development certificate in London, and his business may be of national importance. If he is refused permission, in nine cases out of ten he will simply stay as he is, for often the object of such an application is to bring all the activities under one roof, or he will buy or lease premises in London. Again, there is no scope for steering there, either. Where is the scope for steering? It is not for applicants for office development permits in London, but for applicants already on the move.
The last Government set up the Location of Offices Bureau, and in its first Report the Chairman said:The rate at which firms seriously considering a move have been consulting the Bureau represents a potential decentralisation of 4,500 office jobs a month and shows no sign of slackening.He went on to say that possibly half of these might go out. But there is the figure of 4,500 a month. The Bureau's task is to encourage firms to move out, and to give them information and help as to where they should go. The Government might think that the Board of Trade can take on this task and do it more effectively. I have the greatest respect, indeed real affection, for the 894 Board of Trade, but it is idle to think that firms can possibly regard the Board of Trade and the Bureau in the same light. To the public the Bureau is "one of us". The great advantage it possesses is that it has no compulsory powers, no power of veto. That is its advantage. As it says in its first Report, its task is to help a firm to assess its own needs. Its approach is made clear when it says:The basic premise was that it was good business to move out if the organisation could do so"—that is, either to move out entirely or to move out part of its activities, its routine activities in particular.
What the Bureau is considering is both the desirability of reducing office employment in London and the efficiency of the enterprise. I suggest that both are matters concerned with the national interest. Yet in the Bill the only consideration which the Board of Trade is to have particular regard to is
the need for promoting the better distribution of employment in Great Britain"—not to the efficiency of that employment and of the enterprises that provide it. The enterprise itself may well be more efficient if it moves out in whole or in part, or, equally, it may not. What the Location of Offices Bureau can do is to lead the firm to a decision because of the confidence that the firm has in it and in its complete impartiality. But we must face the fact that any branch of Government which has the power, by an arbitrary decision against which there is no appeal, to prevent a firm from doing what it believes to be in the interests of its own efficiency is bound to be treated at arms length, as "one of them", not as "one of us." This is a fact that must be faced in judging whether or not this is the proper kind of method to employ.
Remember, we are here dealing with those offices which are prepared to move, and the question is how far they can move without affecting their efficiency adversely. That is something which I think the Board of Trade would find it extremely difficult to judge. I say that on the basis of my own experience. Certainly they can cite experience of other cases, which may or may not be comparable. But the Bureau can already do that. It is obvious, therefore, that, to say the least, the introduction of the office 895 development permit procedure has serious practical limitations. Psychologically it will have an adverse effect. Already people have been pointing to the amount of empty office accommodation in London. Offices are empty because rents are so high, because firms are already moving out, because people are coming to realise that they should only do the essential functions in London—functions that cannot be efficiently done anywhere else—and should move out their routine staff.
But what was the effect of the building ban in London? My noble friend Lord Erroll of Hale and the noble Lord, Lord Silkin, both agreed that the effect was that offices to let were taken off the market and then re-offered at higher rents. I must say that I was astonished at the conclusion that Lord Silkin drew from this—it just shows how one control breeds another. What he said was that therefore there should have been another control imposed simultaneously on rents as well. That is how controls breed. The fact is that if supplies are artifically restricted, prices go up.
§ LORD MOLSON
My Lords, would my noble friend not agree that that is an extremely desirable thing—that if rents in London go up as a result of that it will be a further inducement to people to move out?
§ LORD DRUMALBYN
My Lords, that certainly is a point of view, but it is one that is a little difficult to sustain in the light of the Incomes and Prices Policy. It seems to me to be had psychology to introduce this negative control. I agree it is a question of judgment and a question of the general philosophy of Government. By and large, I think it will generally be agreed that we on this side believe in persuasion as the best means of getting co-operation, rather than control. It has been suggested that office building in London acts as a magnet to attract offices to come to London. But, surely, the truth is that it is not empty offices that act as the magnet; it is London itself that acts as the magnet.
I want to have a look now at the steps that require to be taken. I believe that the Bill is misconceived. The main problem is not to stop office building in London, but to get firms already occupying 896 office places in London to give up all or part of it. The Location of Offices Bureau reported in its first Report as follows:After discussions with the 358 firms that have approached it, the Bureau believes that at least half of them will eventually decide to move. In other words, if the response rate experienced in the first six months were sub-stained, it would eventually mean 27,000 jobs a year moving out (this may be compared with the average rate of increase of central London office employment over the last decade of 15,000 jobs a year)".They concluded:It seems improbable that such a rate could be maintained indefinitely. On the other hand, the Economist Intelligence Unit's survey suggested that at least 150,000 existing jobs could well be decentralised. A rate of 20,000 jobs a year over the next decade therefore seems not impossible.The main point is that these are jobs which are already in offices—they will not be touched at all by this Bill. It is the methods which we instituted in setting up the Location of Offices Bureau and the propaganda it will carry out, coupled with building outside, which will affect their movement.
If the movement takes place, demand for office accommodation in London will decline, prices will fall and new building—I am not talking about the replacement building—will stop. If the Bill becomes law there is a grave risk that people will be more inclined to hold on to what they have in London. But the Bill does nothing to encourage people to move. The Bill does nothing positive at all. It is purely negative. If a firm is thinking of moving out of London and is told that it will not be given a permit to build in the conurbation, or even in the Metropolitan area, it may well say, "Thank you very much—in that case we will stay where we are." And, far from reducing the number of office workers coming into London, the Government will be doing the opposite, for employment generates employment.
One way to get firms to move out of London is to provide more offices in the Metropolitan area and the South-East generally, so that people living in those areas will be employed locally and not have to commute into London; it will also deal with the anticipated 600,000 who will be moving out of London, 1,250,000 in all. The Government are 897 going to exercise their veto in the Metropolitan area also. Is this really necessary? After all, there is nothing to prevent the Ministry of Housing and Local Government from calling in any application for planning permission already. They could equally call in all applications for office space of over 3,000 square feet if they really thought it essential for the proper location and phasing of the twenty-year plan.
In criticising the Bill, I am not doubting the need for planning. I am doubting the Bill's effectiveness for the purpose. Of course, I recognise the desirability of getting more office employment into other parts of the country and the conflicting interests of planning authorities in the South-East anxious to provide as much employment as possible for their own local inhabitants. The last Government set a very good example in this respect in relation to Civil Service employment. In passing, may I ask for an assurance that the Government intend to implement the Fleming Report so far as practicable? But this is a marginal problem in relation to the larger problem of finding office accommodation in the South-East area. It is quite plain from the Location of Offices Bureau Report that the vast number of existing offices in the Metropolitan region are not willing or able to move more than 50 miles from London; although, as the Bureau says, some larger firms are willing to consider moving further and can no doubt be encouraged to do so without any Government power of veto. Indeed, they are more likely to do so without it.
I recognise that the advantage of the veto to the Government is that they can go on saying, "No" to an application from an applicant who wants to house all his headquarters office staff under one roof in London or the Metropolitan area, and so force the firm to choose between, on the one hand, the adverse effects on efficiency in being outside the Metropolitan area and, on the other, the adverse effects of being split over several offices in London. That choice may be in the interests of better distribution of employment. It can hardly be said to be in the interests of efficiency.
It may also be said that the control of offices in the Metropolitan region should enable the Government to maintain a national control, so that office building 898 in the Metropolitan region and elsewhere is located and phased in accordance with the employment needs, not only of the 3⅓ million anticipated growth in population in the South-East for whom homes have to be found outside London in the next twenty years, but of other areas as well. If that is the argument, we can expect a virtual cessation of office building to let in Greater London. Is that what the Government intend?
The 1963 White Paper put the dilemma very well indeed, so well that I venture to remind the House of what was said:There is a conflict of interests here. Business, banking and commerce are of the greatest importance to the national economy, and are increasingly taking up a larger share of the working population. London is overwhelmingly the centre for these; and will go on being so. More offices will be needed in London if these services are to function efficiently and under modern conditions. At the same time, the heavy growth and concentration of offices in central London is bringing formidable transport, housing and financial problems in its wake, and these affect the lives of every Londoner.That is the dilemma.
I will conclude in this way. Do the Government accept that London will go on being overwhelmingly the centre for business, banking and commerce? If so, do they accept that more offices will be needed here? Do they accept that, unless London is to suffer a serious decline as a national and international centre, the process of modernising its offices must continue? Will office development permissions be forthcoming for that purpose? What the Government have achieved so far is a complete interruption of that process. For six months already it has not been possible to start any new office building in London for which a contract had not already been made. It has not been possible to obtain planning permission for any office building either in London or in the Metropolitan region, for the lack of an office development programme.
We certainly do not want to prolong this situation a day longer than is necessary for the proper examination of the Bill. How long will it be, from the time the Bill receives Royal Assent, before the Board of Trade starts issuing its office development permits? How long is the situation to continue? How many cases have already come to the attention 899 of the Board of Trade of planning permissions in Greater London which have been put in suspense? And what floor space and office employment do these cases cover—what part of the 17½ million square feet mentioned by the noble Lord, Lord Rhodes?
We will not delay the Bill. We will not oppose it, although we regret—my noble friend Lord Erroll of Hale and myself have made clear our regrets—the change from voluntary co-operation to veto. It is easy to set up a control, but controls breed controls. We warn the Government that by this step they may be retarding the voluntary movement out of London which was begun under the last regime and was so imaginatively stimulated by the Location of Offices Bureau. I have full confidence that the Board of Trade will exercise these new controls sympathetically, but everything depends on the directions they receive from Ministers; and what we want the noble Lord to tell us, as the noble Viscount, Lord Gage, said, is what those directions are going to be. What is the policy behind them?—that is the real content of the Bill. The rest is mere negation.
§ 6.30 p.m.
§ LORD CHAMPION
My Lords, it seemed to me that the case for the Bill was admitted by almost every speaker in the debate this afternoon. The warmth of the welcome has varied very considerably. I did not see any particular warmth in the speech of the noble Lord, Lord Erroll of Hale; neither did I find any particular warmth in the speech of the noble Lord, Lord Drumalbyn. But certainly the noble Lord, Lord Molson, whose activities in connection with this matter I remember so well in the past, referred to the debate which he himself initiated; and I remember his interventions in connection with railway lands and the Transport Act, 1962, a point to which the noble Lord, Lord Hawke, referred in his speech. I can say straight away to the noble Lord, Lord Hawke, that this Bill will catch all railway lands. Indeed, the control which will be applied elsewhere will be applied also to the railway lands which are intended to come on the market as a result of the alterations which have been taking place in 900 the transport world and in the railways in London, particularly.
I must admit that I looked down my nose a little at the Amendments which were moved in Committee on the Transport Bill, because as a railwayman I then thought that the railways should have the advantage of selling their lands at the highest possible figure and in the best possible market. But I must admit that, with the hat which I am now wearing in answering this debate, I have to look at the matter in a slightly different way—namely, that here we are setting out to control office development and to prevent the proliferation of office accommodation in London, if that can be done without any major difficulties to our economy. Here I agree with the noble Lord, Lord Drumalbyn, that this problem cannot be considered only in relation to offices; it must be considered in relation to the possible effects upon our economy as a whole. Of course, it will be the job of the President of the Board of Trade to consider all applications, not merely in the light of their immediate effect here but in the light of their possible effect upon the economy as a whole. That, clearly, must be part of the solution.
The noble Lord, Lord Erroll of Hale, wished that the Government had looked at this whole matter very much more carefully before making their announcement on November 4, and following it up with this Bill which we have before us to-day. He said something which absolutely astounded me. He said, "We had already solved the problem." That statement positively amazed me. When I look around London and see what is happening here, when I see the figures of developments in the pipe-line that were given to us by my noble friend Lord Rhodes, this surely does not indicate that this problem was solved, or was even on the way to being solved.
I am bound to agree with the noble Lord, Lord Erroll of Hale, that the Location of Offices Bureau did a good job, but it could do little more than highlight the problem. It could not hope to solve it by the means which has been placed at its disposal. It gave very sound advice, as the noble Lord, Lord Drumalbyn, has said, to people who made application or brought their problems to it—advice which in some cases was wisely taken. 901 But, my Lords, I fear that the fact that that Bureau had no powers at all meant that this problem could not possibly be solved by it. It seems to me that that would have been an impossibility in the circumstances, when all action was to remain purely voluntary, and when the Government could act only if they felt that the persuasive powers of the Location of Offices Bureau were not sufficient.
The noble Lord, Lord Erroll of Hale, said—and this view was supported by my noble friend Lord Silkin and the noble Lord, Lord Drumalbyn—that rents will rise as a result of this Bill. That may well be one of the consequences; but surely, as the noble Lord, Lord Molson, pointed out, this may very well be one of the stimuli necessary to ensure that some of these people do see the economic advantages of moving out of London, rather than coming into this already very much overcrowded centre, with all the drain upon our resources that this involves, in transport, housing, roads, and all the rest of it. I should have thought that the drain upon our economy that might be caused by higher rents was trifling by comparison with the social costs inevitable in a continuation and further building up of office development in this great conurbation that we are talking about to-day.
Clearly, my Lords, a tremendous number of detailed or Committee points have been made in this debate. I am sure that my noble friend—and, if I have any part to play in it, I myself also—will be very happy to deal with those points in Committee. I may say to the noble Lord, Lord Erroll of Hale, that I shall certainly have no objection to his putting down any Amendments, even if they have been put down previously in another place, if satisfaction has not been given. I am bound to say that, in the case of the progress of the Bill through the other place, Amendments were in fact agreed to and alterations to the Bill were made in the various stages. But, clearly, there still must remain in many noble Lords' minds doubts upon these points, and if they put down Amendments we will do our best, in most cases perhaps, to reject them, and in some cases, I hope, to give them very favourable consideration. But this will depend, of course, upon the Amendments, and I am not promising the noble Lord too much in this connection.
902 The noble Lord, Lord Erroll of Hale, said there was a strong case, arising out of this Bill and out of the decisions which have been taken by the Government, for paying compensation. I imagine that he will return to this subject on the Committee stage, but I do not invite him to do so. I am afraid that I shall not be able to give him much hope that there will be any considerable changes on this matter of compensation. After all, what we are doing by this Bill is simply to introduce a suspense period of seven years. This period of seven years has been called into question by one noble Lord, who suggested that there might be a shorter period. All I would say, in connection with the period of this Bill, is that if it were a shorter period we might well be running into the difficulty that developers will just wait; they will not do anything with their land during that period.
What I want to see, as a partial result of this Bill, is that developers will change their minds, and will put in applications for permission to develop for housing purposes—and housing is what we want. But, of course, even applications for housing purposes will have to be considered in the light of the facilities and services that are available in the particular area. Very much of the land intended for development for offices might well be used for housing purposes. This is a possibility which I was glad to see was welcomed by the noble Lord, Lord Molson, because he knows the problem. And, as I mentioned before, even in the case of the Transport Bill he fought for housing, as against offices, on some of these sites made available by the Railway Executive as a result of the alterations in the transport system.
My Lords, may I interrupt the noble Lord on one point? I do not know whether he realises the colossal loss which any developer would have to face if, having paid an office development price for his land, he were reduced to having it developed for residential purposes. I desire this as much as the noble Lord does, but the loss will be quite colossal; and unless there is some financial easement it will not come to pass, I am afraid.
§ LORD CHAMPION
My Lords, I am not going to pretend that this is not one of the difficulties. I recognise very well 903 that, in this question of preventing people getting compensation, very large sums are involved. I have been told that if we decided that it would be possible to compensate in all the cases where an office development permit was refused, it might involve the sum of between £100 million and £150 million. This, my Lords, is a tremendous amount of money, and the question arises whether the public should be mulcted in such vast sums when these decisions arise out of socially necessary decisions by the Government.
We cannot always compensate people who suffer as a result of decisions by a Government, whatever Government it may be. Budget alterations result in tremendous losses to some people, and you cannot compensate them wholly for that. Then there is the refusal of a planning permission. as my noble friend says. Here we are talking about planning permissions and some of the difficulties that may arise out of the revocation of planning permissions that have already been granted. There is a difficulty, and we recognise it. We recognise that some people will suffer as a result of this, but we do not feel that it would be right, in the circumstances of this case, to embark upon paying huge sums in the form of compensation to speculative developers—or, indeed, genuine developers who are perhaps not speculative in the rather abused sense of that term.
§ LORD DRUMALBYN
My Lords, may I ask the noble Lord, again, whether the figure that he has given relates only to the Greater London Area, to the Central London Area, to the Metropolitan Region, or what?
§ LORD CHAMPION
I am not going to go deeply into the figures, which are very round figures. I believe that they in fact relate to the whole of the area covered by this Bill—namely, the Metropolitan Region—but, frankly, I should not like to be too firmly held to this. I will look into it and perhaps let the noble Lord know, if he thinks it might be an advantage to him to know it.
My Lords, may I ask the noble Lord one point on the figures? I take it that this enormous sum of money refers to compensation for all possible, potential development, right over the whole of the Metropolitan area. It 904 does not refer, I imagine, to that comparatively smaller number of cases where the developer has received permission to develop but is now brought to a standstill.
§ LORD CHAMPION
My Lords, I am not going to go more deeply into this at this stage. It is an extremely difficult one, and I do not propose to be caught up too readily. I can well understand why the noble Lord, Lord Erroll of Hale. smiles at me: I am sure he has been in the same sort of position before. I definitely do not intend to be caught up too easily in this.
The noble Lord, Lord Silkin, hopes we shall succeed in the task that we are undertaking, but rather fears that it will be impossible. My Lords, we must at least try, and this Bill appears to us to be the sort of method that we must try initially. But the noble Lord, I thought rightly, went on to point out that we must try to take positive as well as negative action, and he told us that we ought to be trying to make other parts of the country more attractive for office and other developments—make them so attractive that people would be happy to move to them. I agree absolutely with my noble friend in this. I must say that, as I understand them, the regional plans that my right honourable friend George Brown is talking about are intended to do precisely this: to create in the regions conditions which will help to make them more attractive than they are.
The noble Lord, Lord Silkin, said, "London is the great magnet, the great attraction, for both men and women who want to come here to live". My Lords, I should hate the thought of living in London. It is just about the last place to which I should wish to come, and I cannot understand the tremendous desire to get up to this part of the country. Indeed, although I live in a fairly industrialised area in South Wales, I would not move from it for all the tea in China, or all the offices that somebody might be prepared to give me—I am not talking about offices in Government, because they can be highly remunerative. But one must give this point a little consideration.
§ LORD SILKIN
My Lords, would my noble friend not agree that, in spite of his dislike of London, there are millions 905 and millions of people who disagree with him? They have been flocking to London.
§ LORD CHAMPION
Yes, I agree; and part of the reason why they have been flocking to London is that there have been these offices available to which they can come and work.
§ LORD CHAMPION
There it is. Human beings differ very much in this regard; but I agree with my noble friend that what we must try to do is to increase the attractive nature of some of the rest of the country, to provide the facilities, and so on, to remove some of the awful, long streets of slum dwellings which are a disincentive to people—and indeed much of the hideous squalor that followed the developments of the last century.
Now we cannot be completely satisfied on the point that this Bill will achieve what we have set out to do. Certainly it is worth trying; but we will continue to do precisely what the Location of Offices Bureau was trying to do, and that is to encourage the move of offices to other parts of the country. I am bound to agree with many of the noble Lords who have said, "It is essential that the head office of a particular firm should be in London because of the contact with other head offices, with other facilities and so on, that are available in a great Metropolis". But, my Lords, in so many of these cases, while it might be necessary for some of the head office staff to be in this position, it is not necessary for many of the ancillary functions of such a headquarter's staff to be located within this central area, or, indeed, in the Metropolitan Region at all, as so many firms have found when they have really looked at it. They find that they can send out much of their office work—and that this can be done without any disadvantage to the firm itself—to offices well outside this Metropolitan Region in the South-East. But, of course, this Bill is not a complete clamp-down. It is a control, and can be varied; and it is variable in the light of all the circumstances existing.
The noble Lord, Lord Silkin, said he hoped that we should not be tough 906 merely for the sake of being tough. I hope we shall not, but I also hope that we shall be reasonably tough in our administration of this Bill, although always taking care, as I said before, that we are not tough to the point of damaging our economy. The noble Viscount, Lord Gage, rightly says that the whole control that we are now instituting in this Bill is bound up with planning procedures—planning procedures about which he, because of his associations, knows so much. As I understood it, he was referring in particular to comprehensive development schemes. He had one in mind, I imagine, although I do not know if he actually named it.
§ LORD CHAMPION
He was thinking of the offices which go to support the financial commitments caused by the redevelopment of the centres of towns. This is one of the categories of office development which may not be able to pass the strict tests that the Board will generally apply to applications for office development permits, but we shall be prepared to grant permits in certain circumstances, and this is one of the circumstances where the Board may very well incline towards granting the necessary office permits. I do not guarantee that they will do this in every case. We recognise that there are a number of comprehensive development schemes which depend upon building offices for their economic viability. These range from the major traffic improvement plan already approved by the Minister of Housing and Local Government at Knightsbridge Green to the smaller town centre redevelopment schemes. There are also office development proposals which are linked with providing car parks and for redevelopment of railway sites.
We cannot contemplate giving any blanket approval for schemes of this sort, when we see the need for applying highly restrictive control to other meritorious development. They will each have to be examined carefully on their merits, with a view to avoiding any increase in office area; but although I cannot give the noble Lord the complete answer he wants, I can say that this comprehensive development scheme idea is one of the things in which we shall 907 be prepared to give very careful consideration to the possibility of permitting a certain amount of office development in that particular scheme.
My Lords, I am grateful to the noble Lord; but what I was aiming at was that in the future—whether schemes which are already approved will come into it or not—when a scheme of comprehensive redevelopment has been through all the routes, it should mean what it says. I do not know whether or not this is a Committee point. I do not necessarily wish to go into it in detail, but I want some certainty on the matter.
§ LORD CHAMPION
Yes, my Lords. The other point the noble Viscount was making in this connection is an extremely important one. It is whether one Government can bind its successors. Within the Constitution, as we know it, that cannot happen. We hope that there will be a reasonable continuity of ideas within a particular Ministry. I suppose that is why we have civil servants; they help to provide continuity, although there can be changes of direction when Governments change—as they did, rightly, a short time ago.
§ LORD CHAMPION
They may do so again; but I doubt it.
The noble Lord, Lord Molson, argued that the Bill should also remove the 10 per cent. floor space tolerance under the Act of 1963. We say that this is unnecessary. With the new control which the Bill introduces there is no need at all to tinker with the Third Schedule. The Bill goes to the root of the problem by making all office development above exempted limits subject to control, which will be exercised by the sort of criteria I have been talking about: namely, fairly stringent ones. The problem of modernisation of offices would be considered only if there were no resulting increase in office development. Applicants will have to give up their Third Schedule rights and, in some cases, accept a reduction in office space. I hope the noble Lord, Lord Molson, finds that that answers his point. I believe it supports what my right honourable friend the President of the Board of Trade said in another place and 908 which the noble Lord quoted. Indeed, I hope that I have added a little to that and made it a little more satisfactory to the noble Lord.
§ LORD CHAMPION
The noble Lord, Lord Erroll of Hale, apologised for possibly having to leave; and on his behalf I will apologise to the House. He made the point that there is no formal appeal against a decision by the Board. This is also the case, as I understand it, with Industrial Development Certificates; but, within the chain of control there is the appeal from regional level to headquarters and, as the noble Lord, Lord Drumalbyn, pointed out, up to the President of the Board of Trade himself. Of course, there is always what I think is valuable—and I hope that we shall retain it for a long time—the right of any applicant to raise his case through his Member of Parliament.
This is the chain of appeal that has been recognised. It has been considered by various authorities in the past. The Justice Report of 1961, made by a group of lawyers led by the then Sir Hartley Shawcross, recognised the value of what they called "the internal system of hierarchic appeals" in cases where there was no formal appeal machinery, and accepted that it was sometimes in the public interest that the final decision should rest with the Minister who had to implement a consistent policy. Of course, in this case the President of the Board of Trade will, in fact, have to follow a reasonably consistent policy.
The noble Lord, Lord Molson, wondered whether the Bill is not so tightly drawn that it will prevent compliance with the Offices, Shops and Railway Premises Act, 1963—I think it was the noble Lord, Lord Molson who made that point. Obviously, there is a need to bring such premises up to the standard requirements of that Act. This is an important factor which will be taken into account by the Board in considering applications for permits. But this will not necessarily be a decisive factor for the Board's main task will be to promote the better distribution of employment. They will, of course, look sympathetically at all alterations of existing premises which clearly will not generate additional employment.
909 I fear that I have rather strayed beyond the dictum of my noble friend Lord Silkin that all speeches should be very brief; but he himself asked me a number of questions which stimulated me into rather a long reply. If I have been rather long, I apologise. There are some points which I have left out, but they are mostly of a Committee nature, and I shall be happy, as will my noble friend, to try to deal with them on Committee stage. I would finally say to the noble Lord, Lord Drumalbyn, that the Fleming Report is one which we regard as of great importance. We hope to succeed in the job of decentralising Government offices in London beyond the hopes and suggestions contained in that Report. We recognise its importance, and we firmly believe that Governments should not just tell other people what to do but try to do those things in the right way themselves. I have not answered every point; we will try to deal with some of the other points at Committee stage; but I hope your Lordships will be prepared to give this Bill a Second Reading.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.