HOUSING: PRICES AND BUILDING POLICY (Hansard, 18 December 1972)

§ LORD GARNSWORTHY
My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

§ THE PARLIAMENTARY UNDERSECRETARY OF STATE, DEPARTMENT OF THE ENVIRONMENT (LORD SANDFORD)
My Lords, the way to achieve stable house prices is to increase the number of houses offered for sale. This is happening. Local authorities are free to sell their houses to tenants who wish to buy them and the Government encourage them to do so. So far as new building is concerned local authorities can build to the extent they consider necessary to meet local housing needs.

§ LORD GARNSWORTHY
My Lords, I am grateful to the Minister for his reply. Is he able to tell the House how successful the Government are being in achieving what he says is the right way to approach this matter? Can he assure the House that the number of houses already built this year, and likely to be completed, is in excess of those built and completed in 1963? Is he satisfied that the price of houses is being kept at a reasonable level having regard to the fact that the increase in the cost of living appears to have been a great deal less in the last two years than the rise in the price of houses?

§ LORD SANDFORD
My Lords, we have of course discussed this subject at 812 some length and no doubt will discuss it again, but there are three things I can say briefly to the noble Lord. The supply of houses for sale in the private sector—the prime sector—is 35 per cent. up in the first ten months of this year as compared with the first ten months of 1970. Particularly satisfactory is the figure for the sale of council houses to tenants. This is 36,000 for the first ten months of 1972—more than double the figure for the whole of 1971. But I fully recognise that had it not been for the general problems of inflation we should have been able to do better still.

§ BARONESS GAITSKELL
My Lords, in view of the fact that fewer council houses have been built this year than in any year since 1963, may I ask the Minister what is the point or the profit of selling council houses at all?

§ LORD SANDFORD
In fact, my Lords, the production of new houses (taking public and private sectors together) is up this year on the year before, and was up in 1971 on 1970. The policy of selling council houses derives mainly from the fact that that is what council tenants want.

§ LORD GARNSWORTHY
My Lords, may I ask the Minister to explain how selling council houses adds to the supply of new houses? Will be confirm or deny that the number built in the public sector this year represents the lowest figure, in terms of production in the public sector, since 1967?

§ LORD SANDFORD
My Lords, that may well be so, but we are not now dealing with an overall national shortage of housing. In those circumstances more houses, both in the public and in the private sector, is the right policy. What we are dealing with now is a strong shift towards the desire for home ownership and the need to meet the general problems of homelessness and housing need. The Housing Finance Act is specially designed to increase the rate of council house building in those areas where it is most needed: in Greater London for example, but not over the country as a whole.

§ LORD GARNSWORTHY
My Lords, is it or is it not a fact that the number of homeless in this country is larger to-day than at any time, and does what the noble 813 Lord has just said bear any relation to the real problem that confronts these people?

§ LORD SANDFORD
My Lords, the figures I quoted in answer to the noble Lord's original Question, in answer to his supplementaries, and in previous debates all indicate that the combined effect of the Government's housing policy is meeting the problems of the various towns where the need is greatest. If it had not been for inflation we should have been able to do better still.

§ LORD SHEPHERD
My Lords, will the noble Lord try to equate what he said originally to my noble friend, that the way in which to bring the price of houses down is to provide more houses for sale (both built and from ready stock), with the noble Lord's latest submission that there is no shortage of houses? And will be confirm that for this year, 1972, two years after assuming office, the overall figure for new houses will be lower than that for any year prior to 1963 when the previous Conservative Administration was in office?

§ LORD SANDFORD
My Lords, the position is that the rate of starts of new houses produced for sale over the last three years has been going up steadily. The rate of private houses for sale has been going up rapidly. The overall national figure for public housing starts has been declining.

§ LORD SHEPHERD
My Lords, will the noble Lord answer the question I put to him? Is it not a fact that the figure for 1972 will be lower than in any year prior to 1963? Will the noble Lord answer that small, simple question?

§ LORD SANDFORD
My Lords, if the noble Lord is referring to public sector starts, that is so; but if he is referring to starts generally, it is not so.

§ LORD GARNSWORTHY
My Lords, the Minister knows perfectly well that the question asked was what was the overall figure. Will be please give us what is a quite simple figure, the addition of the public and the private sector?

§ LORD SANDFORD
My Lords, I have answered that point, but I will be more specific. For the years I have in front of me, 1970, 1971 and 1972, the combined starts are 273,000, 286,000, 296,000, 814 respectively. These figures refer to the first 10 months of those three years.

THE LORD BISHOP OF SOUTHWARK
My Lords, would the noble Lord agree that one of the most serious social problems in London to-day is the considerable turnover of staffs in schools in London, sometimes amounting to dozens a year in the larger schools, due to the fact that the staff cannot afford to buy houses in London? Therefore, would it not be in the interests of education in London if the Government were to make it possible for houses to be built and rented to the staffs of the schools, either through grants to the councils or directly from the Government?

§ LORD SANDFORD
My Lords, that is precisely an example of the kind of particular and local need to which local authorities are now having to address themselves, more so than in the past. It is not a question of meeting overall need all over the country.

§ LORD BALOGH
My Lords, does the Minister realise that the increased desire to own houses is a consequence of the lamentable failure of the Government's monetary policy, which created this tremendous boom in house values?

§ LORD SANDFORD
My Lords, the desire for home ownership, and policies designed to meet it, are, I should have thought, matters on which both sides of this House could unite.

§ LORD BARNBY
My Lords, would not the Minister agree, in view of the serious concern of the Opposition as to the dwelling accommodation in the country, that the very large inflow of immigrants into the country this year has possibly added to the pressure on housing accommodation?

§ LORD SANDFORD
My Lords, that is another question; but the original answer applies: if there is a strong demand for houses, the way to meet it is by increasing the supply.

§ LORD GARNSWORTHY
My Lords, this will be my last supplementary question. With regard to what I originally asked him concerning controlling the price of houses, are the Government satisfied with the difference between the increase in the cost of house building, in terms of 815 wages and materials, as compared with the increase in the price of new houses? Will be confirm or deny that the increase in the price of new houses is running at almost three times the rate of the increase in wages and the cost of materials?

§ LORD SANDFORD
My Lords, of course we are not satisfied with the ill-effects of inflation, and that is why we are trying so strenuously to combat it.

§ LORD STRABOLGI
My Lords, may I ask the noble Lord what action the Government propose to take over property speculators who buy up old property, take advantage of the repair grants and then sell the property at a great profit?

§ LORD SANDFORD
My Lords, that is another question, which we have discussed extensively on other occasions.