HL Deb 25 July 1978 vol 395 cc782-92

3.7 p.m.

The PARLIAMENTARY UNDER-SECRETARY of STATE, DEPARTMENT of the ENVIRONMENT(Baroness Birk)

My Lords, I beg to move that this Report be now received.

Moved, That the Report be now received.—(Baroness Birk.)

Lord HARMAR-NICHOLLS

My Lords, I wonder whether on this Motion I may ask the noble Baroness a question which I have put on at least two previous occasions to other ministerial spokesmen, when I have been told that the Department in question was not theirs and they could not answer at that stage. Everyone accepts that the insulation of offices is a very desirable thing that ought to be encouraged. The Government wish to do that, and everyone would support the Government in their endeavours. Is the noble Baroness in a position to say that, if householders go to the expense of insulating their houses, it will not have the effect of putting up the rateable value of the house, which will mean that they will have to pay more rates? When, with the same aim of conserving oil revenue, we encouraged central heating in houses, it was found that the rateable values of properties were increased as a consequence of the extra amenity, which meant that, far from encouraging installation, it acted as a discouragement. As regards insulation, my question is very clear. Is the noble Baroness in a position to say that it will not interfere with the rateable value, therefore causing an increase in rates? Alternatively, if she cannot answer that specifically, can she say that she would recommend to her right honourable friend that instructions be given that insulation will not put up the rateable value, so that we do not have, on the one hand, encouragement, and, at the same time, discouragement caused by the extra expense to which householders would be put?

Baroness BIRK

My Lords, that was an unexpected one at Report stage. As the noble Lord is well aware, rateable values are set by references to the hypothetical open market annual rental value of the property. It is true that, theoretically, it is obviously possible that, by increasing the value of the amenity to the house, the rateable value could be increased, but I am advised that the insulation measures eligible under the Bill are, when taken in isolation, unlikely to have more than even a marginal effect on the assessed rental value. In any event, in England and Wales, improvements which increase the gross annual rental value of a domestic property by less than £30 are normally ignored until the next general revaluation. That is provided for under Section 21 of the Local Government Act 1974. I would add that I think it is extremely unlikely—in fact, practically impossible—that, when the Government are taking this initiative and paying people to heat their houses, they would then put up the rateable value in that way. It does not make sense, even in the Alice in Wonderland situations which sometimes go on in government.

Lord PLANT

My Lords, would my noble friend not agree that the valuation office have never increased the rateable value of a house because of the insulation of a loft?

Baroness BIRK

That is absolutely true, my Lords. That is why I particularly pointed out to the noble Lord opposite that although this was theoretically possible in fact it had not happened in this case and it was very unlikely that it would happen.

On Question, Report received.

Then, Standing Order No. 43 having been suspended (pursuant to Resolution), Bill read 3a.

Baroness BIRK

My Lords, I beg to move that the Bill do now pass.

Moved, That the Bill do now pass.—(Baroness Birk.)

3.12 p.m.

Lord SANDYS

My Lords, I feel that this is an appropriate opportunity to mention to the noble Baroness the pace with which we have been invited to discuss this important Bill; because it is against a background of four years in which the whole question of energy saving has been discussed that this very small Bill, a Bill which has only the remit to carry out approximately 10 per cent. of the housing programme insulation every year for 10 years, is included. The Second Reading took place on 12th July, the Committee stage on 18th July, and today we have just had the Report stage and Third Reading.

We are being invited at considerable speed to examine this Bill and, although it is not for me to suggest how the Government arrange their business, it appears that it is Bills of this type which might well be examined in this House at a very much earlier stage in the Parliamentary programme and be much more satisfactorily discussed. We hope that the insulation programme is a great success; but how can this be so, particularly for the forthcoming autumn and winter, if, in fact, Royal Assent is likely to take place early next month followed by all the usual provisions? In the first place, local authorities will be advised by circular; they, in turn, will be expected to advertise the scheme; and the programme will, we hope, get off to a start in the autumn. Had this Bill been considered by this House at an earlier stage in the Session, it might have been possible to have the whole thing not only on the stocks but moving by now—to the great benefit of large numbers of people in this country.

I should like to express gratitude on behalf of my noble friend Lord Strathcona and Mount Royal for assistance over a number of questions in connection with this Bill. As I understand that the particular issue of approved materials has been a matter of discussion between the Department and the industry, it is, I hope, a matter on which the noble Baroness will be able to inform the House in a few minutes. It is a further issue whether materials will be approved materials under British Standards specification. This in itself is another reason why the Bill ought to have been completed at an earlier stage, so that this vital aspect of approved materials for the programme could have passed through its usual stages. I am grateful for what the noble Baroness said on 18th July (in cols. 188 and 189 of the Official Report) in regard to the budgetary considerations, because what she said in her remarks at that time, the assurances she gave, went a considerable way to removing anxieties which were expressed by my noble friend Lord Strathcona at Second Reading. It was not clear from the Explanatory and Financial Memorandum how this programme was to be paid for. Now we understand from the noble Baroness that it is a 10-year rolling programme, although the Explanatory and Financial Memorandum did not say so.

Lord LEATHERLAND

My Lords, will my noble friend bear in mind that, whenever this beneficent Government do anything to bring comfort to ordinary families in the country, it is greeted with moans from the Party opposite? It may be that this beneficent measure could have been introduced earlier.

Lord SANDYS

Yes!

Lord LEATHERLAND

My Lords, the noble Lord says, "Yes". I would remind him that his Government were in power for three or four years and they did nothing whatever about it. There is no use in the noble Lord pretending that this method of insulation was not available at that time. Even in the days of the Tory Government, I had my own roof insulated by the method suggested in the Bill. In introducing this Bill, we have done a good thing which will benefit many thousands of families throughout the country. I think it is very mean for the Party opposite to pour cold water on it.

3.17 p.m.

Lord FERRIER

My Lords, I deeply resent what has been said just now by the noble Lord who has just sat down. It seems to me that we have done everything in our power to fall in with the desire of the Government that this Bill should be pushed on to the Statute Book as soon as possible. I was reading the proceedings in another place and there they said it was five years ago that it could have been gone on with. I think it was very unfair to suggest that this has been met with moans or groans or whatever it was the noble Lord said. It is nothing of the sort.

I preface my speech with the words: As I said on Second Reading, I and many others on this side of the House do support this Bill and wish to give it a fair wind. Nevertheless, I may say, it could have been a much better Bill—and this was the point made by my noble friend—if the Government had given us more time in which to consider it. In this respect, I feel I owe the House an apology because I put my name to two Amendments but I could not come to the Committee stage because of the fact that this Bill had the sign on it in the Minutes which meant it was "set down before the expiry of the recommended minimum interval between stages". This is what has gone on because it was not introduced earlier, as my noble friend Lord Sandys said it might. Nevertheless, I owe thanks to my noble friends on this side of the House and to the noble Baroness for making understood some of the points that I made in the Committee stage and, with my noble friend Lord Sandys, I look forward to the noble Baroness replying to this problem of materials which is one that I raised on Second Reading.

I think that we all agree that this matter is of such importance and means such a lot to poor people with the cold winter coming along that it is better to have this Bill, imperfect as it is, than not to have a Bill at all. But I and many noble Lords on this side feel that that is poor consolation to those who think the measure should have been tackled a long time ago, perhaps years ago. Home insulation being a function of domestic space heating, I must confess that I used the Second Reading as a vehicle for my relentless pursuit of lower off-peak electricity tariffs for domestic heating.

The reductions which have taken place in the past few days do not go far enough. They do not cover Scotland, for instance; but that is another matter. I was glad that my noble friend Lord Harmar-Nicholls mentioned the question of rates. The reply of the noble Baroness went some way to meeting the problem. That is something we did not discuss at the Committee stage, any more than the question of VAT has been mentioned. Perhaps the noble Baroness will speak on that when she winds up the debate.

There arises one point about insulation which I think is apposite and is a matter of interest to me and my family who have lived in the tropics for many years. My wife pointed out to me yesterday that if one insulates a house and keeps it cool inside one could find that the insulation keeps the cold in. This has a bearing on the angle which I took of the importance of adequate space heating which will result from proper low tariffs. I hope that the noble Baroness is going to be able to say something about dangerous materials. It has been suggested to me in various consultations that the time may come when more regulations may be required in regard to furnishing materials generally. I refer to the hazards which fire fighters have to face today with fumes and smoke which arise from some of the modern materials. That again is another matter. I support the Motion that the Bill, with all its blemishes, be given a Third Reading now.

3.22 p.m.

Lord AIREDALE

My Lords, I should like to support both Conservative speakers in what they said about the haste with which this Bill was hurried along. It was intimated to us in Committee that, if a single Amendment were to be agreed to, the whole Bill might be lost. All I can say about that is I simply do not believe that it is the will of the electors that there shall be single-chamber Government in the month of July.

Lord ROBERTHALL

My Lords, following the tenor of the remarks of the noble Lord, Lord Sandys, may I ask whether the noble Baroness is able to give us some idea of when the local authorities will be ready to receive applications?

3.24 p.m.

Baroness BIRK

My Lords, in dealing with the points which have been raised, may I first say something about the timetable and what has been described as the Bill being introduced at a late time in the Session. The timetable was agreed through the usual channels in the usual way. It was agreed between both sides of the House. I find it rather odd at this stage of the day—but I think it is a bit "end of termish" at the moment—that the noble Lord, Lord Sandys, should have raised that question in that way. If I may focus on his remarks, may I thank him for the kind messages which he passed on from the noble Lord, Lord Strathcona and Mount Royal, which I enjoyed rather more than Lord Sandys's own remarks, although I am sure they were very good-humoured.

This is a short and simple Bill. We all discussed it and I explained carefully on Second Reading and also at Committee stage that due to the small amount of resources that can be put into the first scheme and because the Bill itself outlines not only the possibilities but the framework for future schemes, there is a tremendous simplicity about it. With great consideration and thought about it, I cannot believe that spending very much longer on it would have got us any further. I have no recollection of cutting down or trying to stop anybody on Committee stage. There is no guillotine in this House; every Amendment was discussed extremely fully. Other noble Lords from both sides of the House who did not share this considerable interest intimated to me afterwards that they thought I had gone on rather too long about it. One really cannot please everybody.

Lord FERRIER

My Lords, may I interrupt the noble Baroness? I personally would have put down an Amendment or suggested a Schedule regarding building materials had it not been for her appeals, which I feel were justified, that we should get on with it.

Baroness BIRK

I appreciate that, my Lords. The noble Lord will agree that we have had correspondence, we have spoken about it and I intend in a moment to reply for the record to the point that he raised on the use of materials. As the noble Lord said, he was unable to be here at Committee stage; otherwise no doubt he would have raised the matter on the Question, Whether the clause shall stand part of the Bill? even if he had not had the opportunity to put down an Amendment. But I do not think that one can argue on that.

With the other Bills which have been through the House in this Session—the Scotland Bill and the Wales Bill to name but two—which have taken a considerable amount of your Lordships' time, I think that it is a triumph for both sides of the House that we are going to get this Bill on the Statute Book. My noble friend Lord Leatherland had a point when he said—and it is part of the political scene—that when one brings in anything it is always considered that it is either late or does not go far enough. It is traditional for such matters to be greeted by moans. That does not make it a less important measure.

The answer to the question that the noble Lord, Lord Roberthall, asked about when the local authorities will be able to take action is this: We are hoping that this will be some time in early September. Directly the Bill gets the Royal Assent, local authorities, who know all about it in any case—it is not really a highly complicated measure and they will have already been discussing it and getting their plans underway—will have been circularised and will get it underway.

On that point, I must say to the noble Lord, Lord Sandys, that one has to take human nature into account. When the weather is rather warmer and there is the odd nice day like today, people do not start, as perhaps they should, thinking about insulating their homes. When we get to the fresher days of September and October the demand will come and, then, I can assure noble Lords, local authorities will be able to deal with it. On the whole, noble Lords will agree that there has been a wide measure of agreement and a repeated emphasis on this throughout the discussion on this Bill. There has been a recognition of the overriding need to bring the first scheme under the Bill into operation before another winter is upon us. The noble Lord, Lord Ferrier, has kindly advised me of his questions in advance and he and the noble Lords, Lord Sandys and Lord Strathcona and Mount Royal, have raised the question at some length of ensuring that the products in respect of which grant aid is given are both effective as insulants and safe in use. This is an extremely important point.

If noble Lords will bear with me for a moment, this is something that I think should go on the record in our discussions on this Bill. I think that I should make it clear immediately that most insulation products generally available in this country at present have been tried, have been tested and have been proved in use over many years. The insulating industry itself has taken action to ensure the safety and effectiveness of its products. A number have already submitted voluntarily to the Agrement Board for assessment and other manufacturers are working with the British Standards Institute towards the urgent establishment of a British standard.

Officials of my Department have been closely involved with a number of manufacturers and only yesterday were having further discussions with them and, I believe, the Agrement Board on this. However, it is true that the introduction of this Bill will no doubt lead to the appearance of a number of new products on the market. Despite the steps already taken by industry therefore the Government remain concerned to see that adequate measures are taken to protect the householder and ensure an effective use of public resources. We are therefore continuing urgent discussions with the various interested parties to establish an effective method of excluding from grant-aid projects which fail to meet acceptable standards, and I am confident that will be achieved very soon. I can, however, assure the House that these discussions and the introduction of appropriate control procedures will not delay the commencement of the first scheme, which will come into effect, as I said, as early as possible this autumn.

The noble Lord also referred to VAT. At present there is no special VAT relief for insulation work, although in some circumstances the work can be exempted under the general zero-rating for building and reconstruction work. The distinction for VAT purposes is between works of constructional or alteration services which are zero-rated, on the one hand, and works of repair and maintenance, which are standard-rated, on the other. Insulation work on new buildings and first-time installation of insulation in existing buildings would both be within the first category, and thus qualify for zero-rating for VAT purposes. As there is no question at the moment, as I explained at earlier stages, of any "topping up" being possible, these would all be new insulation schemes and therefore should be zero-rated.

In answer to the noble Lord, Lord Ferrier's interesting point—or rather his wife's point—about insulation keeping the cold in, this is, of course, working on a sort of vacuum process. If we have a very hot summer it is rather like having a thatched-roofed cottage: it seems to keep one warm in winter and to keep one cold, combined with stone, in summer. So in a way one could say that people are getting two services for one, and even North of the Border it has recently been quite hot. In other words, you can keep hot when you want to, warm when you want to and cool when you want to. That gives an added dimension to the advantages that people are going to get.

Lord FERRIER

My Lords, I really only meant to link it with the cost of heating a house. The point is that it is no use insulating the house unless you can heat it inside in cold weather. That is why I want low rates for heating.

Baroness BIRK

My Lords, I can see that point. I think we would all like low rates for heating; but I think the noble Lord will agree that if you want to keep the heat in you have to heat up the house to start with. I think we are all agreed on that.

Finally, I will reiterate that this Bill, although a modest one, is of great importance in regard to our general efforts to conserve energy in this country. The debates have served to highlight some of the problems which face us as we try to instill a greater awareness of the importance of energy conservation in the country at large. Certainly we shall be looking closely at this problem and at how fast we can move towards the further measures which are contained within the Bill, ready to be taken in hand directly resources are available. In the meantime, I would ask the House to pass this Bill.

On Question, Bill passed.