§ 3.54 p.m.
§ Debate resumed.
§ Baroness Birk
My Lords, returning to the housing debate which was initiated by my noble friend Lord Pitt, I should like first of all to thank him for introducing such a pressing and urgent Motion, and also to say how much I am looking forward to hearing the maiden speech of the noble Lord, Lord Cornwallis. My noble friend's account of the conditions which exist and the actions taken by Government do not constitute a happy story. Unfortunately, there is no rosy tale to tell. I thought the noble Lord, Lord Byers, backed this extraordinarily well, and with great expedition.
It is true that past Labour Governments have not been blameless, but the extent of the problem, particularly in the public sector, was never as clear then as it is today. Even when, under Labour's housing cutbacks, housing starts were at their lowest figure in the late 1970s, capital expenditure on housing was nevertheless twice as much in real terms as it is today—certainly nowhere near the low figure of housing starts in 1981. When the Government talk about an increase in housing starts we have to remember that in recent years it is from a very grim and low base.
My noble friend has indicated some of the extent of the problem, particularly in London, and also the cost of restoration and repair. These costs can only increase. Meanwhile, millions of families in all sectors will be forced to continue to live in ever more intolerable and squalid conditions.
I think we must look at this in the context of the Government's whole housing policy. The Government's recent initiatives in housing expenditure did bloom in the autumn of last year. After three years of reduction in capital resources, local authorities and housing associations were suddenly encouraged to spend and spend. The devastating results of the English Houses Condition Survey referred to by my noble friend prompted the Government to increase dramatically their expenditure on improvement grants—an initiative carried forward into the current financial year. and a very welcome initiative it was.
In October 1982 local authorities were asked to submit capital projects for rapid approval in an attempt to shift the underspending which arose because of the receipts from council house sales. In addition, expenditure on the enterprising block by block improvement of our older housing stock, known now as "enveloping", was pioneered by the City of Birmingham. What has happened to these important initiatives? Local authorities and housing associations at this time responded as rapidly as they could. Indeed, housing association expenditure increased in 1983–84, and local authority expenditure rose to £2,400 million in 1982–83, reaching at least £2,700 million this year. Programmes of housing improvement and repair in the public sector expanded rapidly, and over £2,000 million is already committed for 1984–85. The estimates suggest that expenditure will again be at least £2,700 million this year.
708 Last month, approximately 500,000 people were involved at various stages in the improvement grants system, due to heavy Government advertising. As a result of this potent encouragement to spend, under-spending has been virtually eliminated for this year. The problem now, as I see it, is that it seems likely that, if the predicted level of expenditure is reached, the Government's own capital cash limits on housing will be breached. The last time that happened, in 1980–81, there was a Government freeze on further expenditure over a four-month period. Is that likely to happen again? Another freeze would be catastrophic. I should like to hear from the Minister when he replies whether that would be one of the alternatives if the cash limits are breached, which in fact I think they will have to be if any housing increase is to take place. Last month the Government sacrificed their sacred cow by announcing an end to the improvement grant increases and the money to pay for them. This means more job losses and again more housing deterioration.
In his Autumn Statement, the Chancellor of the Exchequer announced a cut in housing expenditure of nearly £500 million. I would support, without repeating it, everything the noble Lord, Lord Byers, said about this. We cannot afford to reduce housing expenditure. We cannot afford not to increase it, and the future is very grim unless there is going to be some increase. The extra £60 million for the enveloping schemes, which have been found to be the best way of dealing with the inner city areas, is being cut as well. The 1984–85 housing investment programme allocations to local authorities and the housing associations are about the same in cash terms, as I am sure the Minister is going to tell us. But for local authorities it is 45 per cent. less in real terms than they were receiving in 1979–80. That is really the important figure.
Clearly, resources are wholly insufficient to deal with the magnitude of the structural and the human housing problems with which we are faced today. Housing investment is not just a question of investing in housing—which is important enough—but an essential part of our economic recovery. The country is starved of investment for its infrastructure. We have heard the CBI, the well-known Group of Eight, which is comprised of private builders and developers, and others pressing these arguments for capital expenditure for many years now. There are 400,000 construction workers unemployed, and there are 4 million dwellings needing at least £2,500 or more spent on repairs to each of them. My noble friend Lord Pitt of Hampstead gave us the research figures that showed how it would energise the industry and reduce unemployment if more capital were put into housing. It costs at least £5,000 a year to keep someone who is unemployed, including the tax forgone. That seems an extraordinary way to run our society, spending billions of pounds to keep people out of work when we could be energising the whole of our economy by putting more money into the construction industry as a whole. That applies to the public and the private sectors.
The Government's stop-go-stop approach to older housing mirrors their lack of a forceful and just housing policy. Recent announcements in another place suggest that all our housing needs can be met by owner-occupation, with local authorities and housing 709 associations providing mainly for the disabled and the elderly. I need only take your Lordships' minds back to the Housing Act 1980, when many of us fought hard, from all sides of the House, to get an amendment which extended the exceptions to the right to buy and gave more flexibility for local authorities to build houses for the elderly to rent. In fact, what has happened? Where appeals have been made to the Secretary of State, 90 per cent. have been turned down. So the amount of accommodation for the elderly has shrunk and its place has been taken by houses to sell.
The responsibility of the house-owner or occupier is to ensure that the physical conditions in the dwellings are up to a reasonable standard, as laid down by the Government. At its face value, that makes common sense and sounds reasonable. That is all very well, but some people simply cannot cope. Study after study has shown that the worst physical conditions, in numerical terms, are now concentrated in the owner-occupied sector, where people forced into low income occupations have to suffer appalling housing conditions because they are unable to match the gap between the cost of repair and improvement and their own income levels. In the Oxford Times last week, instances were given of people who, relying on a survey, had purchased houses from the council—some years ago, it is true—who are now being faced with repair bills of £12,000 but who cannot get any help from the local authority because it does not have the money to help them. They are unable to find the money to repair their own houses.
It is true that the numbers on the waiting lists may be open to some question, with people not taking their names off the list or, occasionally, a doubling up. But the national level has risen in recent years from around 1.2 million households to 1.5 million. Whatever the arguments on the periphery are on whether that is a precise number or not, the fact remains that the waiting lists have increased.
As my noble friend pointed out, homelessness is so severe, particularly in London, that literally hundreds and hundreds of families are waiting in bed and breakfast accommodation queues for a local authority tenancy. That is another way in which one is literally throwing away money to no good end. We are keeping people in accommodation that is uncomfortable and unsuitable for families which is costing the local authorities a fortune but is not putting any permanent investment into housing stock. It also means that fewer people can be taken off the housing list because the authorities must first deal with the homeless.
The Government's policies are socially divisive. My noble friend referred to the tax relief on mortgages being raised to £30,000. At the same time, the Minister for Housing makes statements to the Housing Consultative Council suggesting that subsidies to the local authority sector should gradually be eliminated.
We are developing a housing "two nations" for ourselves. One nation is represented by the well-housed owner-occupier, able to afford repairs to his or her home. The other is the "welfare" sector of the local authority tenants, who are becoming further concentrated in the least attractive accommodation as the best estates are sold under the right to buy and as the public sector housing diminishes and deteriorates.
710 Of course, where it is possible and the stock of housing is available, people should have the right to buy their own homes, but this means that there should be a quid pro quo and authorities should have the opportunity and the resources to build sufficient houses to rent and to repair those that they have before they fall into such decay that they need to be demolished instead of being left to stand as unlivable-in eyesores. I believe that there is action which can be taken rapidly to improve the condition of our older housing and those houses constructed in a defective manner. First, there should be a thorough review by the Government of repairs needed for older housing. I should like to have confirmation from the Minister that there will still be a house condition survey in 1986 which will be carried out in accordance with the practice of the past 15 years.
A reinstatement of the improvement grant initiative until the end of 1984–85 will make a tremendous difference to this problem at the comparatively low figure of £250 million. The further funding of the block-by-block envelope scheme for terraced houses should be increased, not cut, with a cash limit of even, say, £100 million, because that is the only policy which has been shown to be really effective in improving particular types of inner city area. The Building Research Establishment should be commissioned as a matter of urgency to undertake a thorough assessment of all the problems associated with house-building defects, which we are hearing about almost week after week in various statements.
In my view, we need to move away from a tenure-based ideological approach to the basic and previously agreed position that everyone has a right to a home of an acceptable standard, regardless of income. In other words, back to Beveridge! We need policies to match the real needs of people living in older property. To meet those requirements, a proper level of resources for repair and new building is essential for both public and private sectors. We cannot get round that basic point. The aim should be, and must be, what the Labour Party has always stood for: the basic right to a decent home for everyone.
§ 4.7 p.m.
§ Lord Cornwallis
My Lords, the statistics which the noble Lord, Lord Pitt of Hampstead, has brought forward are very alarming and we must all be aware of the great personal distress which follows on the tail of such statistics. The suggestions which I make to your Lordships this afternoon have already been lightly touched upon by the noble Lord, Lord Pitt of Hampstead, and if they are in some detail, that is perhaps because this is not an easy subject on which to make a non-controversial speech.
If we are to remedy the situation to which the noble Lord referred, we must surely have replacement housing available to accommodate those displaced by the need to refurbish or redevelop substandard accommodation. In this context, I draw the attention of your Lordships to the existing schemes, to which again the noble Lord has referred, operated by the Abbey National Building Society, by the Town and Country Building Society and perhaps by others. As a director of the Town and Country Building Society, I must, of course, declare an interest.
711 These schemes are operated on parallel lines. To date, that of the Abbey National has been directed almost exclusively towards local authorities and public bodies, whereas our own operations have so far been with industrial companies. Both schemes require the involvement of a housing association outside the Housing Corporation. Briefly, the freeholders in our present involvement—Blue Circle Industries—have the property valued at open market values. They make a project management and development agreement with a housing association and pay the planning application costs. The housing association carries out the feasibility study and the negotiations with the planners and the building society, bank or other financial institution. In this context, the National Westminster Bank has already expressed interest in the schemes. The financial institution will lend up to 80 per cent. of the projected development cost, with the property value hopefully providing the remaining 20 per cent. The property must then be pledged to the lender. The loan is repaid from the sale of the houses and the freeholder, for the property, at an agreed figure per house afterwards.
These schemes have many advantages. They require no public money. Planners seem to like dealing with housing associations. A housing association is a non-profit-making body and therefore tends to produce low-cost housing. No money is laid out in advance, other than the planning application and study costs, until all the planning approvals are through and the contractor chosen and on site. The money can then be drawn down, but the bulk of it can be returned to the money market to help defray interest charges until required for stage payments. Interest charges are therefore kept to a minimum. There has been no overbidding by a developer and therefore there is not the pressure on the planners to agree to something that they do not want in a sensitive inner city area. It avoids the problems of planning refusal to a purchaser and the consequent freezing of the land until circumstances change.
These schemes often release redundant and difficult sites that would otherwise lie idle. The disadvantage is that the freeholder may not obtain quite so much for his property as he would at auction or by tender. The snag is the difficulty of persuading local authorities to release their land or substandard property instead of hoping that one day they will be able to develop it themselves.
During the debates on the Agricultural Holdings Bill many noble Lords emphasised that we could not manufacture more land. It is very important, therefore, that we make the best use of that which we have and most particularly in the urban areas. These schemes can help us to redevelop within our urban boundaries and, hopefully, relieve the pressure on greenfield sites. At present we have two sites under construction, one in discussion with the planners and four more in discussion with Blue Circle and another public company. The Abbey National has seven sites in various stages of development. The noble Lord, Lord Pitt of Hampstead, made special reference to London. I am sure he would he interested to know that three of those sites are in Tower Hamlets, Bermondsey and Fulham. In these schemes of the Abbey National, 712 approximately 30 per cent. of the houses built go to rental accommodation.
We are also well aware, as the noble Lord, Lord Byers, has said, of the contribution which the construction industry makes through its domino effect on other industries. It adds to the provision of employment and creates extensive extra work in many factories of diverse nature. I suggest that by greater use of schemes such as those I have described we could increase our housing stock, refurbish and replace substandard housing and provide more houses for rent at a reasonable cost.
Three hundred and seven years ago my ancestor was tried in your Lordships' House for manslaughter. I should not for one moment suggest that making one's maiden speech is an equivalent situation or ordeal. On that previous occasion your Lordships' predecessors acquitted my forebear. From what I know of it, I believe that the verdict was somewhat generous. I hope that this afternoon I have not strained your Lordships' indulgence to the point where your verdict may not be a similar one.
§ 4.15 p.m.
§ Baroness Denington
My Lords, I feel particularly privileged to have the honour of congratulating the noble Lord, Lord Cornwallis, on his maiden speech. Not only was it informative and wise, but it had that little touch of wit at the end which was quite delightful. The noble Lord has certainly acquitted himself very well indeed this afternoon. I am sure we all hope that we shall hear him many more times in this House.
I was also delighted that the noble Lord drew attention to the part that the building societies and housing associations are playing, particularly in the rehabilitation of our housing stock. I use the word "stock". It is not, I think, a good word. In today's debate we have necessarily heard a lot of figures, but we must never forget that this afternoon we are talking about a human problem involving homes and people. As the noble Lord said, we are talking about people who suffer a lot of misery because of their wretched housing. I think that "misery" was the word that the noble Lord used.
Many of your Lordships must have seen this misery while working on housing matters and among people. Many of us have seen leaking roofs with pails and pans having to be placed on the bedroom floor; or a room may be so small that the bed cannot be moved out of the way and a pan has to be placed on the bed at night under the leaking roof. Rotten window frames let in rain and cold. We are all concerned about insulation and keeping places warm, but there is no possible chance to keep a house warm where wind comes in through the windows and ill-fitting doors.
Some houses have no constant hot water. I cannot think how a woman can bring up a family without constant hot water. It is an absolute misery. There is no other word to use. When there is really bad housing, I cannot see how there can be harmony in the home. What is a home without harmony? This is what we are talking about: people and people's lives. We must have the figures. but we also must think of the individual family in the house and relate what we are saying to their needs.
713 I am exceedingly keen—if I may use that word in this House—on improvement grants. They are being used to do a very good job indeed, but progress is too slow. An enormous number of houses need to be dealt with. According to the last figures I saw, only 100,000 had been dealt with; but something is better than nothing. However, as I say, progress is much too slow.
A great number of councils have been, and are, making an enormous drive on the improvement grant front. They have set up teams of workers to go from house to house in an area, canvassing the grants, and giving every possible service, such as free architectural advice on how to plan the improvement. The teams work with building societies, which are also more than helpful. Now we have a situation where the Government are to curtail and cut the grants. When the need is so very great, that is an unthinkable thing for a Government to do. The help provided by improvement grants to owners, landlords and tenants is exceedingly great. I just pray that the Government will have another think on the improvement grant front.
If I may, I should like to speak for a few moments about a particular city in this country of ours, the city of Leeds, which I recently visited in my capacity as a member of the board of a housing association. I was—to put it mildly—horrified at what I saw going on. Leeds still has a tremendous number of back-to-back houses still remaining. They tell me there are approximately 20,000. Immediately after the war I thought this country was going to make a great drive at getting rid of the back-to-back houses. I do not know what the position is in other cities, but in Leeds there are 20,000 such houses still remaining and 16,000 of them need substantial repair and improvement. These to me are houses that ought to be demolished. This is what worries me. They are back-to-back; they have no yard and nothing outside; one house backs on to another house and they face the pavement front on. You cannot put a bicycle outside, for, as I have said, there is no yard or anything. Where does a woman dry her washing? There is this problem in Leeds. I get all this information from my housing association. I think the houses ought to be pulled down as fast as possible.
What are we doing? We are spending public money on these particular houses. A thousand of them still lack one or more of the basic amenities and even in these days between 200 and 300 still have an outside WC. Not having a yard, as I have said, it is an outside WC situated down the road in a little row shared with other people: a privy. But I am told not so privy as the WCs in disrepair. This is a scandal and must not be allowed to go on. These houses, as I said earlier, must be demolished.
Now to come to what is being done as a result of improvement grants. There are two exercises: there are improvement grants for houses for rent, and improvement grants for houses for sale. They come under different regulations. I should like to inform your Lordships, as briefly as I am able to, how they work. At current levels, to buy and improve a back-to-back house in Leeds costs, I am told, approximately between £18,000 and £20,000. This section is for renting. The taxpayer in this case makes a grant of about £16,000.
714 My query for this kind of house is: is it sensible housekeeping for the nation to he spending £16,000 to improve these houses? I am told that the local authority does not have enough money in its HIPs to undertake the clearance which it must to rehouse, rebuild and rehouse again in the rebuilt houses; turning the site over, I presume, would be the sensible thing to do. They just cannot do that; there is not enough money. To spend £16,000 on a house is a lot of money for something which is going to last, I hope, for just a few years.
To turn to the rehabilitation of houses for sale, I know full well that the particular position I am going to describe does not apply just to Leeds. I have seen it, read about it and had to try to deal with it in other areas of the country. It is a financial problem. A grant for rehabilitation for sale is a different situation.
Let us go back to the Leeds position. The purchase price is much the same as houses for rent. When the houses are for sale, there is a grant of £7,500 maximum: so to buy a house costs £15,000, but the improvement grant is limited to £7,500. As I have said, a house sells for between £18,000 and £20,000. But the rehabilitated house sells for only £15,000, so one can only repair it to a very much lower standard. That is what I am getting at.
I went to see one such house where I am convinced that it had been improved as well as was humanly possible. You have a front door and you open it and it goes straight into the living room; there is no lobby to keep the draught out, and there is not a very clement climate in Leeds. The stairs are at the back of the living room; there is no door and the draught goes straight up the stairs. There is a bathroom and one bedroom on the first floor and just a bedroom and a landing on the next floor. There is nowhere for a bicycle; there is nowhere for a pram. There was not enough money to build a porch on the house. When the houses were selling for a little less perhaps 18 months or so ago, you could put a porch on. Now you cannot do so. It is absurd to be doing this work and selling the property as a basically bare product: a back-to-back house.
We have done the best we can with the money that we are allowed, and I ask the Government to have a look at this problem and see whether the grant can be increased or some other arrangement made. I am told we are not even allowed to have swings and roundabouts: possibly saving on one house and using the saving on another house; each house has to stand on its own. Is it not really quite absurd? I hope the Government will look at the situation. I am sorry to have dwelt on a specific case but it is an illustration of the kind of thing which is going on and which really does need looking at.
Industrialised housing is really hated—there is not any other word to use. Tenants just will not live in them; some of them cannot bear it. I would say that if it can be rescued some of it might be rescued; but a basic tenet there is to consult with the tenants and convince them that you mean you are consulting; that you mean you are listening to what they say, will take notice of it, and will act on it. Some of the industrialised housing will have to be pulled down; there is no other answer. I suggest to the Government that in those cases they might consider writing off the debt.
§ 4.29 p.m.
§ Baroness Gardner of Parkes
My Lords, I too should like to congratulate the noble Lord, Lord Cornwallis, on his maiden speech, which I found particularly interesting. I should like to thank Lord Pitt for bringing this subject to us for debate today. I listened carefully to what he said and I noticed that his view was that unsuitable properties should be cleared as rapidly as possible. The noble Baroness, Lady Denington, held this same view. I have a slight reservation on that in that I was a candidate in Blackburn where I saw those acres of desolation where all the properties had been cleared and nothing was replacing them. They were properties that subsequently were found to be houses which could have been rehabilitated. People could have had good homes; but instead the houses had gone and nothing more could be done. I urge caution in that respect.
I was also rather disturbed when the noble Lord, Lord Pitt, talked about mortgage tax relief and stated that he would not go so far as to abolish it, but possibly to reform it, or transfer the funds somewhere else. I consider that quite enough to frighten anyone trying to meet mortgage payments today. Many people have sufficient trouble, and I hope that the Government will assure us that there will be no change in mortgage tax relief. I am all for the present system.
I support absolutely the view of the noble Lord, and that of the noble Lord. Lord Cornwallis, that more liaison between the building societies and local authorities is desirable. In the City of Westminster the Abbey National is offering to take over all the mortgages of local authority people who are buying their accommodation. This is freeing funds that can then be put back into the housing account. One small difficulty is that while, when the money is freed, the amount received is gross and the capital receipts from sales of property are, for measuring purposes, taken by the Department of the Environment as gross, credit is allowed only in net terms. The benefit, in terms of re-using the money, is therefore not as great as it could be.
Westminster City Council was one authority selected by the Audit Commission of the Department of the Environment for an independent private audit in terms of a value-for-money audit of its housing account. The conclusions were most interesting. One of the most important conclusions was that rather than carry out repairs piecemeal and as required, which is current practice, it is far more economic and satisfactory to have a rolling programme of repairs and to preplan them. That means, for example, that all window frames are repaired at a certain time when it is known that the frames are about to reach the end of their useful life. This is less expensive and proves to be better value for money. Unfortunately, the council is caught in the situation of not having the necessary capital to implement these money-saving schemes. There are difficulties, but I believe that the council will put these ideas into action as soon as possible. Even now, the council is doing its best.
There was a most interesting report on the Mozart Street estate, in Paddington, which was a prizewinning scheme about 10 years ago, but which now has great problems. It has become one of those estates where no one wants to live, though structurally the buildings are quite impressive. The council has plans 716 to spend £400,000 on improvements. The design of tower block estates is terribly important. On the Mozart Street estate, it is now considered that the fact that it was built as a co-ordinated whole, with elevated walkways and quick routes from one block to another, is one of the great problems. Muggers and vandals can make their get-away very quickly. People feel vulnerable and unprotected.
I consider that the security aspect is most important in the structure of a building. People speak about tower blocks as disasters. There has been mention of industrial building. I feel strongly about personal security for people living in private homes, or in council accommodation. If people are living in an atmosphere that they find hostile and in which they feel themselves to be constantly under threat from those around them, it is a great risk and a great worry. It can be as great a disturbance to people's lives as is the physical deterioration of the building.
I notice that in its scheme for the Mozart Street estate, Westminster Council plans to concentrate on 50 flats in a pilot scheme, spending about £200 on each flat to provide it with a door entryphone. I consider that door entryphones have only limited use. Those who have canvassed at the time of elections will know, I am sure, that if you ring all the buttons, someone will always let you in. A door entryphone is therefore only as good as the weakest link on the end of the phone. Much greater personal security is achieved by stronger front doors. Security doors are to be provided. Glass panels beside doors, or within doors, are to be removed, and the doors strengthened.
A similar pilot scheme is being carried out by the Greater London Council, which has selected 1,500 properties for the purpose. It actually selected 1,650, but, surprisingly, there are a number of people who refuse to have done any kind of work to improve their property. The cost will be £180,000; that is, £120 per dwelling.
It is believed that much greater personal security will be achieved simply by strengthening the panels of the front door. Often, people return home to find that, following a break-in, the locks on the door are completely intact but the door structure itself is completely destroyed. It is therefore believed that the answer is to make stronger the front door, together with window locks. This is to be done.
The home security market is a growing market. It is desirable, I believe, to produce schemes that can be adopted quickly and cheaply and that have a potentially wide application. Once the measures that I have described are adopted—I am not talking about the entryphone, which is vulnerable to vandalism or misuse—they do not require any maintenance and attention, and the tenant does not have to rely on other users. They remain value for money for a long time.
I should like briefly to refer to two other matters. One of these is the Housing (Homeless Persons) Act 1977, which throws great and unfair responsibility upon some boroughs. I recall my time serving on the London Boroughs Association, when Hounslow constantly complained because it received all the homeless arriving at Heathrow Airport. A similar problem was faced by Westminster City Council and, I think, most of the central London councils. Last 717 year, Westminster had 1,400 vacancies to offer. Of those, 500 went to people covered by homelessness provisions. Only one-third of the 500 had any real claim on Westminster. This meant that the remaining two-thirds were jumping the queue over people who had spent many years on the waiting list.
I know that representations have often been made to the department to consider some change. The present situation in regard to homelessness is unfair. It should be a pooled responsibility, rather than the responsibility of the individual borough where people happen to arrive. Those who have a direct claim on the borough should be treated in a different manner.
Another problem that has made many people's lives a misery is that of condensation. As at one stage a district housing chairman for the Greater London Council, I have visited housing estates, as, I am sure, has the noble Baroness, Lady Denington. She will have seen conditions just as bad as those that I have witnessed. On the Aveley estate, walls were green, mould was growing, and liquid was dripping. Wedding dresses were spoiled. It was hard to believe that things could be so bad where industrial building systems had been used.
Much study has now been carried out into condensation problems. I recognise that dry lining—which is being carried out by Westminster City Council—is helping. I am aware also that Westminster City Council is applying its mind to using available funds to the best advantage. One proposal is to employ individual specialist consultants in various subjects. That means that the council has to meet the bill only once. It uses the service, it receives the report and it can then implement it.
For example, it has called in energy consultants in the form of the National Industry Fuel Efficiency Service, who have looked at a large estate and have found that it is totally uneconomic to have one vast centralised heating system. It is most wasteful. Indeed, I know many people living on the Lisson Green estate who cannot stand the heat; they have to keep opening the windows. What could be more wasteful than that? The recommendation is to change over to smaller individual boilers and to allow people to control the quantity of heat that they require. There is the one exception—which I thoroughly support—of the aged persons' dwellings, where they cannot change over the heating system because many old people worry about heating bills and will turn the heating off if they can.
However, the condensation problem is a combination of heat suddenly hitting cold surfaces and a lack of ventilation. After all, the building regulations on ventilation are rather stupid because they insist on all these air bricks, and the first thing people do when they move into a flat is to cover up the airbricks with sheets of that self-adhesive plastic, because one person's ventilation is another person's draught. As a result, the condensation problems grow ever greater.
Great strides have been made in the way in which local authorities have been applying their minds to improvements, but as time is running short I do not intend to go into it any more. However, one interesting fact is that on the Mozart Street estate £86 per flat per annum is the cost of vandalism to the common parts. That estate comprises 740 flats, and that vandalism 718 represents a loss of £63,640 in a year. That is money which could very well be spent on improving the housing there; money that would be very welcome in the general housing account of that authority. If that is happening on that estate, I am sure that the same thing is occurring in many other places.
I cannot conclude without mentioning the private landlord. It is a great shame that the Rent Act 1974 has pretty well abolished the private landlord and has made it almost impossible for people to let private accommodation. This is why so much has been thrown onto the housing associations and the local authorities. I would also comment that the housing associations receive much better finance from the Government than do the local authorities. The housing associations receive a direct grant, whereas the local authorities do not receive a Government grant. They have to finance the housing themselves. It is just permitted expenditure; and when the allowance is made at the end it is simply an allowance on the interest that they have paid. Therefore, it is not as good.
However, for many years the private landlord has been pilloried, and now all housing is falling into the same state of disrepair because of this problem. You must have a certain income to be able to afford to carry out the repairs, whether the property is privately-owned or local authority-owned.
§ 4.44 p.m.
§ Lord Dean of Beswick
My Lords, first may I join the previous two speakers—my noble friend Lady Denington and the noble Baroness, Lady Gardner of Parkes—in their congratulations, and compliment the noble Lord, Lord Cornwallis, on his very informative maiden speech. I found it very interesting. The noble Lord certainly has specialised knowledge of housing associations and building societies, on which I am sure we shall hear from him again in this Chamber.
I should also like to thank my noble friend Lord Pitt for selecting housing as the subject for this Short Debate, for the way in which he delivered his speech and for the mass of statistics that were contained in it, which certainly covered housing in its widest spectrum.
In the time at my disposal I propose to address my remarks to industrialised and semi-industrialised building. Housing is, of course, probably the most important requirement of any family if a decent quality of life is to be sustained. I address my remarks to a feature of housing which I believe has emerged as the most serious and urgent housing problem requiring our attention. I am referring to the industrialised and semi-industrialised housing, large stocks of which a considerable number of local authorities have in their housing pools.
Earlier this year, in another place, I had a debate on this subject during the proceedings on the Consolidated Fund Bill. In that debate I referred to the fact that the faults which were already showing in these systems (most of them having been built since 1960) were but the tip of an iceberg which was starting to surface with frightening speed.
As a nation we have to decide what is to be done about this problem and who is to bear the financial 719 responsibility. Should the responsibility be borne by the builders and designers of the dwellings, or should it be borne by the Government? I place no particular blame on the present Government or the previous one, but I blame their predecessors, of both major political parties, who were responsible for encouraging, sponsoring and, in some cases, promoting these systems. At the time there was considerable opposition from local authorities concerning the use of these systems, but by means of financial arm-twisting and other coercive measures successive Governments imposed their wills, with the subsequent disastrous results, including the extremely serious financial situations which some of these local authorities now face.
During the time that I have left I want to illustrate some of these. The main factor in creating the position in which we now find ourselves was the policy of successive Governments, which, to accelerate the house-building programme, turned to system-built houses to top up the then target of 300,000 houses per year and to increase it to 400,000. Although that target was never reached, a considerable number of these properties were built annually. Despite strong objections on a wide scale from local authority representatives, local authorities were cajoled and induced by means of the subsidy system into adopting these forms of building, with the resultant problems. As I have said, I was prominent in local government at that time and I was at the forefront of that opposition, but unfortunately and tragically we lost the argument.
The other factor that was used to persuade people to use these systems was that it would be cheaper to build using such systems than to use traditional methods, and it would be faster. Nobody ever proved that it was faster if one took into account the factory time required and the site preparation before the building was constructed. However, the financial outcome was that, taken on a national average, the industrialised house was 20 per cent. dearer than its traditional counterpart. Therefore, not only did local authorities receive a bad deal financially, but they were a saddled, in aesthetic terms, with monstrosities of the worst kind.
I was glad to hear the noble Baroness, Lady Gardner of Parkes, refer to Leeds in her speech. However, Leeds is not all bad. It has its share of bad properties and it has its share of old properties that remain. But basically the area that I represented in Leeds has very few back-to-backs and a lot of good council housing. If one wants to look at the worst aspects of housing in Leeds, one should look at a notorious block of flats (which is similar to the one in London to which the noble Baroness referred) which has deck access with linked walkways. It is completely socially unacceptable, has been built less than 15 years and has now actually been declared to be in a dangerous condition. That is the type of property about which I am particularly concerned.
I welcome the financial assistance which the Government are making available to people who have bought houses from their local authorities which were built by prefabricated means. But why stop there? Is it not fair and equitable that this assistance should be extended to local authorities, so that they can carry out 720 their obligations to tenants in similar accommodation? In my debate in another place some months ago I mentioned that the figure of £3 billion was required to deal with this problem. But the AMA have since published a report indicating that a conservative figure ("conservative" with a small "c") is £5 billion, and not £3 billion. That is the dimension of the financial problem that they are facing.
I was surprised at the unhelpful answer given by the Minister in this Chamber when I raised the question with him on Monday last. He reiterated the Government's now famous fallback position on housing, that more finance would be available if more council houses were sold. I detect that the Government have only two policies: one is of improvement because they have nearly killed building altogether, and the other is the sale of council houses. It is almost like going to see a doctor who prescribes aspirin for every major illness you get, which is about as effective as the Government's policy will be on housing.
Let me issue a warning to people buying this type of house. I do not want to confuse the issue: I am talking now about houses built before 1960. They are mainly prefabricated, slab-concrete houses, We hear from the Conservative Govenment about being a property-owning democracy. and that people are being allowed to purchase these council houses. I can tell your Lordships that people who are buying these nontraditional houses are buying an asset which they will never be able to realise.
I can quote a copperbottomed case in Leeds that came to my notice. A family bought one of these houses, known as a Smith-type house—houses which have not, as yet, been found defective; and I say "as yet". They bought it 16 years ago, at full discount. The house is a first-class house. I went round to see it. The lady concerned put the house on the market two years ago at £2,000 less than the valuation recommended by her estate agent. There has not been one offer in two years. I suspect that the Government, in encouraging people to buy council houses at that time, were landing them with a so-called benefit on which they will never he able to realise and of which they will themselves be the last tenants, or certainly the ones who will die in them. That is one part of that particular situation.
Let me now turn to the financial consequences involved for the local authorities concerned with the initial problem about which I spoke in my speech—the industrialised and semi-industrialised buildings. I quoted a development in Leeds built 14 years ago which has had considerable sums of money spent on it in the meanwhile. The local authority took the decision to spend sums of money to try to put the property in a safe condition, more socially acceptable, and so that they could keep it in the housing stock. But they were throwing hundreds of thousands of pounds of good money after bad. Therefore, the local authority took the decision, for that and a variety of other reasons, to demolish the property and rehouse the tenants.
The financial outcome is that the demolition of this property, because of the 45-year outstanding loan repayment period and other related costs, will, it is calculated, put 22p a week on every council house rent in Leeds for the next 40 years. Almost every other major local authority has considerable numbers of 721 these properties in its housing stock. Certainly Manchester, with the now notorious Bison development, has at least three times as many as Leeds and has, I understand, taken the decision to disgorge them from their stock, with the resultant inevitable financial consequences. What Leeds and Manchester have had to do other local authorities—large cities, London boroughs—will have to take decisions about in the immediate future.
The problem is not what to do with the stocks of housing, in my opinion, but when. It is my submission that they have no future in our housing stock and should be demolished as a priority. Bearing in mind the responsibility that previous Governments have in this matter, the cost of this ought to be borne by central Government.
My Lords, in the post-war years the architects, planners and builders of this country had a wonderful opportunity to build a new Britain. It must be said that in this facet of local authority housing they have failed abysmally, and the scars will remain for the foreseeable future. In my opinion it would be monstrously unjust to expect other council house tenants, both now and in the future, to pay for these mistakes.
§ 4.56 p.m.
§ Baroness Stedman
My Lords, from these Benches I too should like to offer our congratulations to the noble Lord, Lord Cornwallis, on his excellent maiden speech this afternoon. We too look forward to hearing him taking part in other debates on this and other subjects. I should also like to express our thanks to the noble Lord, Lord Pitt, for giving us this opportunity to talk about housing this afternoon. He is right to call attention to the condition of post-war housing. However, I am equally, if not more, concerned about the pre-1914 and the inter-war housing stocks which are still with us.
After the 1960s, the industrial systems of building became commonplace. Local government, with financial assistance from central Government, went overboard for numbers of housing units rather than quality of the building. They boosted the numbers by building more and more flats rather than houses in our great conurbations. With hindsight, past Governments, and city and borough councillors and architects, must accept some of the blame and some of the responsibility for rushing into using untried and untested systems of building.
In Peterborough, where I was a board member of the Development Corporation in its early days, we did not wish to rush into building by industrial means. We decided deliberately as a board not to go in for high rise building of flats but to build more and more houses with gardens. We wanted our buildings to last, and we looked for tried and tested building methods, for easy maintenance, and for houses built in pleasant surroundings each with its own garden.
We, as a board, attached some importance to what we were creating, and all our rented accommodation was built with a view to long-term saleability. We have had no real building problems, and our houses are now selling fast to satisfied buyers, unlike in a neighbouring new town, Corby, which went in for a lot of industri- 722 alised building which is now being wound up and handed over and has something over 2,000 houses in need of considerable repair.
As I said earlier, I am concerned about the severe problems caused by the number of pre-1914 houses still in use, the state of that stock, and its even more rapid deterioration. Also, much of the inter-war housing is now occupied by elderly tenants and owners, many of them on low, fixed incomes and unable to maintain their accommodation properly or to improve it. Reference has been made to the English housing survey of 1981, and the result is certainly frightening. More than two-fifths of the unfit dwellings in 1981 were owner-occupied, and one-third of them were privately rented accommodation.
The percentage of all the dwellings found unfit that had been built between the wars increased from 3 per cent. in 1971 to over 10 per cent. in1981. Fortunately, significantly fewer homes, one in 20, now lack basic amenities, but the number of unfit dwellings, as the noble Lord, Lord Pitt, has said, remains broadly constant between 1.1 million and 1.2 million. But disrepair is on the increase, and some 200,000 more houses than in 1976 now need repairs costing over £7,000. If you acknowledge disrepair costing over £2,500 instead of £7,000 to put it right, then 3.9 million dwellings are now in disrepair, and that is something like 22 per cent. of our total housing stock. I accept that figures can be manipulated, but, if you take the number of dwellings in need of repair just to make them wind and weather-proof, then you are talking about something like 5 million dwellings.
It is now generally accepted in housing fields that nearly one quarter of our housing stock is unsatisfactory, with the older housing stock being worn out faster than it is being replaced. Experts believe that at the present rate of improvement, it will take 50 years just to deal with the very worst. The noble Lord, Lord Pitt, was talking about centuries to solve the problem. We should remember that nearly one-third of all the houses now standing were built before 1914, many of them to a much lower standard than we expect today. Yet the housing improvement grant is to be cut back to 75 per cent.
Maybe, just maybe, there is sound reasoning behind that, but can the Minister tell us when he replies what kind of take-up there was at 90 per cent. improvement grant, and did the higher rate offered encourage older and needier persons to apply for the grant to improve their accommodation?
The 1981 survey goes to some length to compare owner occupied housing with the private rented sector. But, as a New Society article pointed out recently, if one compared the owner occupied and public rented stock one would find that 51 per cent. of the homes in serious disrepair; 43 per cent. of unfit properties and 37 per cent. of those lacking basic amenities are owner occupied, while the figure for the public sector is 5 per cent. in serious disrepair, 9 per cent. unfit and 15.7 per cent. lacking basic amenities.
These figures have to be treated with caution, and they reflect the dominant position of home ownership. But, one could also use them to argue that owner occupation is not necessarily the universal panacea that this Government believe nor is the record of public housing as bad as is sometimes represented.
723 Most of us at some time in our political life have waxed rhetorical about housing—about the provision of sufficient accommodation, about getting rid of bad housing and housing conditions, about maximising the choice of housing and about getting value for money. However, the present housing construction programme is quite inadequate for our present needs. The Government's policy is to increase owner occupation. On these Benches we are in favour of home ownership, but the low start home buying schemes of shared ownership are having only a marginal effect. Home ownership is not being encouraged by a more plentiful supply of housing, but by selling off council houses by using the carrot of high discounts and the stick of higher rents. The latest CIPFA statistics show that the 24 per cent. increase in capital spending went more to servicing debt than to building houses. Because of the cuts in local authority budgets and the sale of council houses. public renting has become less available, less attractive and much more expensive.
Why can we not have all-party agreement on the minimum number of houses which need to be rebuilt or improved to keep pace with new demand and the rate at which existing buildings are becoming substandard? It is time to give some stability to house-building construction. We need to find a means of directing our national resources—not only money, but people, materials and land—towards renewing and preventing deterioration of our housing stocks.
Also, we need a reform in housing finance. We need to take a more neutral attitude towards both renters and owners. We need a tax system that will encourage better maintenance and rate of occupation of our housing stock. Above all, we need continuity of programmes and sensible decisions gained through the consensus of all concerned. Anyone closely involved in housing knows that housing finance is a mess. I have no doubt that what we really need is an expert committee to consider housing finance as a whole, to produce a report and strategic and detailed practicable proposals.
I, too, am interested in the growing attention of building societies to rented housing. I hope that they will be given every encouragement as financial institutions to work with housing associations to develop and manage rented housing to complement the traditional public sector housing and also to continue to expand on the lines indicated by the noble Lord, Lord Cornwallis. It may require changes in subsidies, but I believe that it could be a positive way to develop and improve our housing. Money alone will not solve the problem, but I urge the Government to review the financing of housing improvement and modernisation. They should consider how best to use whatever money is available to get the best possible return for the nation in terms of houses which can be saved and given a much longer life. It is a top priority, and it ought to be a top priority as the housing survey has shown us.
§ 5.7 p.m.
§ Baroness Fisher of Rednal
My Lords, I begin by congratulating the noble Lord, Lord Cornwallis, on his speech this afternoon. A new angle and different point 724 of view was expressed, and we look forward to further contributions from the noble Lord. I should also like to thank the noble Lord, Lord Pitt of Hampstead, for giving us the opportunity to discuss various angles on housing. I shall concentrate on the problem to which he drew our attention; that is, the discovery of defects in council property built within the last 20 years, or less. I shall concentrate mainly on those problems.
As my noble friend Lord Dean of Beswick has mentioned, in so many instances the defects will mean demolition of properties. I want to emphasise, with all due respect to the noble Baroness, Lady Gardner of Parkes, that these are not condensation problems. They are serious defects, where concrete is crumbling, and the safety of the properties must be considered.
I can remember so vividly that when I was chairman of Birmingham Housing Committee we built so many system-built properties. My housing officials used to go round following grumbles from tenants about water penetration. On many occasions I said, "Do not tell the tenants that it is condensation because they keep the kettle boiling and do not make the pot of tea quickly enough, or that they are boiling potatoes too fast, so that the steam is not going out of the property".
§ Baroness Fisher of Rednal
My Lords, I shall not give way to the noble Baroness. I have 14 minutes, the same as she had. I am not giving way.
In the past local authorities have put the blame on Governments for not safeguarding building standards. The present Government are also being criticised by local authorities for not being too helpful towards meeting the cost of remedying faults and defects. I should like to emphasise what my noble friend Lady Denington said. What is of paramount importance is that in some cases tenants are compelled to live in deplorable housing conditions in properties that were built less than 20 years. Great misery is caused. I hope that with his knowledge of medicine, my noble friend Lord Pitt will acknowledge that such conditions can cause ill health among young children. There is damp, and mildew on walls. Recently, when I was in the north of the country researching inner cities. I saw in blocks of flats, flooding that was an inch and a half deep in every room. The local authority is in the strange situation that it cannot find the cause of the faults in order to remedy them.
All along the line the tenant is being asked to pay increased rents when, in many cases if we were owner-occupiers we would say that no more mortgage money would be paid until the contractor had made good the faults. Therefore, many of these tenants live in a nightmare, with carpets rotting and wallpaper peeling off the walls, as my noble friend Lady Denington (whose great knowledge of housing we all admire) elicited this afternoon.
The tenant is faced with little help initially from the local authority because the local authority recognises that there are major defects in the non-traditional types of dwellings, defects in design and construction, and therefore they are not easy problems for the local authorities to solve. Not only that, but because of the massive bills that will have to be paid the local authority is contesting all along the line with the contractor as 725 to who is going to help to make some of the payments. There, with all this going on, one has the tenant almost in despair at the endless delays while inspection after inspection takes place until the building work to remedy the defects is commenced.
In an answer in your Lordships' House to my noble friend Lord Dean, the Minister said that these defects are not known. On reading that reply, all that I can say is that the noble Lord the Minister does not know much about what is going on inside local authorities. I can say to him that near to where I live the tower blocks are being completely renovated on the outside, and scaffolding has been up on two blocks of flats for more than 12 months.
I should like to say this afternoon that it might well be a valid exercise for those architects, those designers, those planners and those building contractors, who made handsome profits, to visit some of the dream houses that they were supposed to be providing for those less well off in the community. Let them face the wrath of the tenants! In those areas, that anger is at present vented upon the councillors, who are constantly being asked the question, "What are you going to do about it?" The fault is not theirs; the fault lies mainly with the contractors.
As my noble friend Lord Dean has said, during the 1950s circular after circular was issued by the department extolling the use of non-traditional methods of house-building. Local authorities were given capital grants if costs were greater for non-traditional than for traditional, and authorities could also apply for additional allocation if they agreed to build by new methods. As has been said already, local authorities were not entirely convinced of system building—something which they had never used before. I know that local authorities are much maligned by some poeple, but more often than not they are very conservative (with a small "c") when it comes to trying anything very new. During these periods they were perhaps a little hesitantabout them, but they had long waiting lists. I can remember from when I was a chairman of the local authority in Birmingham that with 30,000 to 35,000 families waiting for houses one is concerned. The proof that was given to us was that these would take half the time to build. So, with the full support of the Government, local authorities ventured on what has proved to be a very costly exercise.
Furthermore, not only have we a costly exercise but the Minister has only recently asked all local authorities to make a check on their Bison concrete housing. We all know about Bison properties because they were shown on one of the television networks only recently. The Government themselves have decided that grants need to be paid to Airey houses. I would ask the noble Lord who is to reply why grants of 100 per cent. towards the cost of reimbursing owners of Airey houses should be given for repairs that are carried out at their expense, when there is no extra allocation for local authorities within their house improvement programme for dealing with their own tenants who are living in identical properties. My noble friend Lady Birk gave examples of how the improvement grants are operating. She has given us her knowledge of the worst action that we can expect to take place with the cutback of improvement grants. But we are to expect 726 shortly the gloomy views regarding house improvement programmes.
At present, local authorities are entitled to reinvest into house improvements half the capital they earn from the sale of houses. It is rumoured—I merely say that it is a rumour, and perhaps the noble Lord who is to reply will counter that rumour—that this half is going to be reduced to one-quarter. With sales of council property already flagging, if this percentage is reduced there is quite obviously less available for major schemes of repair, not only on system building but on the pre-war stock, which is now 50 years old. What is required from the Government, in my view, is a declared intention that they will consider amendment to house improvement allocations to take account of the problems of each local authority with this type of building.
It is not only the building costs with which local authorities are faced; it is the remedial work. But in some instances it means rehousing people, it means loss of rents and, as has been said previously, in some cases it means the complete writing off of the 30-year loan charges which are outstanding. We must all be concerned at the large amount of public money that will need to be spent on system building defects; and lessons have to be learned. The Government have a responsibility to make quite sure that our housing stock does not deteriorate further; because, if it does, the future will bring another housing crisis and the need again for a sudden increase in building programmes, possibly with the same disastrous results as we are discussing this afternoon.
What is necessary are three-year housing programmes so that local authorities can plan continually. It is folly to expect them to plan on an annual basis. The building industry itself and its component suppliers are faced with heavier financial commitments on the stop-go finance of 12 months' planning. What is recognised by many outside the Government, and by this side of the Chamber, is that it makes economic sense to spend public money on housing. House-building is labour intensive, it uses fewer imports than any other industry and it not only creates jobs but provides homes.
In conclusion, I fully accept that many families will have their housing needs met by the private sector but it must not be forgotten that there are families whose only chance of a home is in the public sector. The Government must face the fact that those thousands of families who are unsatisfactorily housed, or those with no homes, the elderly and the disabled, are of equal concern, and in many instances their provision will only be funded by public housing by local authorities, by partnership schemes or by housing associations.
§ Baroness Gardner of Parkes
My Lords, before the noble Baroness sits down, may I correct her statement referring to my speech? My comment was that I did not intend to discuss the structural defects of industrialised building, not that I was unaware of them.
§ 5.20 p.m.
§ Lord Skelmersdale
My Lords, the topic which the noble Lord, Lord Pitt of Hampstead, has chosen for 727 debate this afternoon—the state of our housing stock—is obviously of fundamental importance to everyone in the country. Regretfully, one cannot always gauge the importance of a debate by the fact that it has attracted a maiden speaker. Today, though, is an exception. The noble Lord, Lord Cornwallis, gave us the benefit of his wide knowledge of the mortgage market and the building industry. He produced evidence of a most valuable scheme which I shall certainly draw to the attention of my right honourable friends.
The noble Lord, Lord Pitt, spoke with all the conviction and deep knowledge of housing matters that he characteristically shows. I welcome the opportunity to say something about the Government's approach and policies. I shall come a little later to the question of post-war housing, on which most of the debate has concentrated, but first I want to set in a wider context the issues that have been raised.
First, for most of this century the basis of the housing problem has been one of sheer lack of housing. Today, however, thanks to post-war building programmes, there are about 1.1 million more dwellings than households. Of course, I realise that the true underlying housing situation cannot be gauged simply on the basis of this crude measure of relativity. Certainly we need to take full account, among other matters, of the condition of that stock. But the housing argument has ceased to be simply about the number of dwellings being built.
My second point is the tremendous growth in home ownership. Owner-occupation grew steadily during the 1970s, and by June 1983 nearly 62 per cent. of dwellings in England were owner-occupied—an increase of over 5 per cent. since the Government came to power in May 1979. I understand that the official Opposition are coming round to seeing the very real benefits of the right to buy, on which I shall later have a little to say—
§ Baroness Birk
My Lords, I wonder whether the noble Lord can explain what he means by that? I am sure that he did not intend it, but it came over as rather a snide remark. I do not know what he meant about "coming round to it". We have never ever said that there should not be a right to buy. All we are saying is that the right to buy should not be taken to the extreme where we do not have houses to rent for those people who cannot afford to buy.
§ Lord Skelmersdale
My Lords, if I have given the impression of being snide, I would say that that was certainly not my intention—at least not quite at that point in my speech. But, as I understand it, in the past when the right-to-buy legislation was first promoted, the Labour Opposition were dead set against it as a concept, whereas now, I believe, they are—perhaps "breaking ranks" is the wrong expression—coming to an acceptance that there is a logic to it, and quite a good one.
§ Baroness Birk
My Lords, we were not against the principle, but rather against the legislation itself, with the enormous discount.
§ Lord Dean of Beswick
My Lords, I think that the record ought to be put right. As an ex-Whip in another place, who dealt with all the housing Bills, I would say that the official standpoint of the Labour Opposition was, and still is, that the prerogative to sell council houses ought to be left with the local authority which owns them, taking into account local need. The local authority ought not to be dictated to.
§ Lord Skelmersdale
My Lords, right; so we have got that straight. I still do not think I agree with it, but nonetheless—
§ Lord Skelmersdale
Well, my Lords, perhaps there is a lot in the housing field that we should all come round to and over which we should start to accommodate each other. I was talking about the increase in owner-occupation. There is no doubt that this trend reflects a deep-seated preference on the part of the people. It also has important implications for the repair and maintenance of the stock, the primary responsibility for which rests increasingly on the owner-occupier. If home-ownership is one great aspiration, there has also been a steady social pressure for improvements in the standard of housing.
As recently as 1971 there were nearly 3.2 million dwellings in England which were either unfit or lacked at least one basic amenity such as a bathroom, or were in serious disrepair, and indeed suffered from some of the very disturbing problems we have been hearing about this afternoon in stories about particular houses and buildings.
By 1981, that figure had been reduced to just over 2 million and, of those, 15 per cent. were standing vacant. That is very real progress, and, so far as the general condition of the stock is concerned, I would refute any suggestion that we are facing a crisis. For the noble Baroness, Lady Stedman, to refer to 50 years as the period needed to put the housing stock into reasonable condition is, I consider, alarmist.
§ Lord Skelmersdale
My Lords, how can it be? There is certainly a growing problem of disrepair and I will try in a few moments to describe how the Government propose to tackle it, but first I want to put into proportion the contribution which the public sector makes towards maintaining the private sector stock. With respect, I do not seem to be doing very well at the moment because there seems to be constant barracking and opposition, though, in view of the subject, perhaps I should say I am not surprised!
I think, I am about to incur the opprobrium of your Lordships yet again: nonetheless I intend to say this. It is, with respect, facile to suggest, as has been suggested by the Opposition today, that the condition of our housing stock is related simply to the amount of public expenditure made available for home improvement and repair. Why cannot the party opposite understand that the fact that you increase the sums of money to solve a problem does not actually do anything for the root cause? Public expenditure can only prime the pump. In the 1980s we estimate that in the owner- 729 occupied and private rented sectors, privately-financed expenditure on home improvement and repairs, whether by way of loans or cash savings, was some 30 times that financed by the taxpayer and the ratepayer. In all but the very short term, the condition of the housing stock will reflect the overall performance of a country's economy and not just levels of public expenditure on improvement grants and housing subsidy.
The noble Lord, Lord Pitt, in introducing this debate, referred to the English House Condition Survey of 1981, and one other noble Lord asked whether it would be published following its normal quinquennial pattern. My understanding is that it will. The condition of the housing stock revealedin that survey reflected years of poor national economic performance. The survey suggested that about one dwelling in 10 was either unfit, lacked amenities or needed repairs costing over £7,000. If the repair level was lowered to £2,500, about one in four was affected, as we have heard. It also showed quite clearly that unsatisfactory conditions are still most likely to be found in properties built before 1919.
We have been doing a great deal to meet these challenges. As my honourable friend the Minister for Housing and Construction made clear in a recent debate on housing repair and improvement in another place, since 1979 we have made the home improvement grant system more flexible, more generous and better attuned to the needs of priority groups. We have also provided local authorities with the resources to enable them to give grants in numbers which were unheard of throughout Labour's period of office. Take repair grants: between 1974 and the beginning of 1979 no more than 500 such grants were paid over the whole country. In the first half of 1983, 44,000 such grants were paid, 90 times as many as in the whole 1974–1979 period. We have acted on an unprecedented scale to tackle the problem.
Inevitably, however, the noble Lord, Lord Byers, and other noble Lords who have spoken, asked about the HIP allocations for 1984–85. I hoped that when I was answering on Monday I had explained that, but I obviously failed to satisfy the House. As my right honourable friend announced on 24th September, gross provision for housing investment by local authorities in 1984–85 is £2,522 million. From within this gross provision, the total available for Housing Investment Programme allocations is £1,853 million. In addition to those allocations, authorities are also free to reinvest the prescribed portion of their housing capital receipts. There is no doubt that in the past they have not always done it.
The noble Baroness, Lady Birk, referred to a potential overspend this year. We shall just have to see what comes about, but my understanding at the moment is that there will not be a general overspend at all. We estimate that authorities will generate £666 million of receipts next year, which will be available for investment over and above their allocations. I was asked about grant expenditure and I can tell the House that total spending on all types of grants was about £90 million in 1978–79, nearly £200 million in 1981–82, £430 million in 1982–83 and it is expected to be exactly the same next year. Of course, it is too early to say what the outturn of the current year will be.
730 It might be sensible if I turn now to the housing built since 1945, and particularly to that built by the public sector. In this modern stock, there have been some serious problems of design, materials and workmanship—more than we all should wish to have seen in comparatively new buildings. It is distressing when blocks of flats built no more than 15 years ago have to be demolished, because their basic design or layout is so unsatisfactory, or because they cannot be repaired at worthwhile cost. But we need to keep a due sense of proportion about these problems. We in the Government and local authorities, tenants, the building professions and the lending institutions must all take care in assessing their implications for the stock as a whole, or I fear that we shall rush into hasty, ill-judged and costly action which is certainly not immediately necessary.
The noble Baroness, Lady Stedman, suggested an all-party agreement on spending on housing with figures for replacement agreed by everyone. Would that I could, but I have never really believed in heaven on earth. It would not, of course, work, as no policy can ever be decided in isolation from all the others which come within a Government's programme. It would also have to be decided within the framework of the current Government's economic ethos.
About 11 million houses and flats have been built in the United Kingdom since the war and 5 million have been built by private developers. The house building industry has responded to the aspirations of more and more people to own their own homes. I am told that private housing starts for Great Britain are expected to reach a level of 165,000 this year—a figure which was last exceeded only in the days of the previous Conservative Administration in 1973. A small number of failures is only to be expected given the numbers built, but the evidence is that the overwhelming majority will continue in satisfactory condition for many years.
The same is true of the majority of the 6 million dwellings built by the public sector since 1945. About 5 million used conventional designs and materials. They provide comfortable accommodation, though no doubt, as living patterns and standards change, some work will be needed to meet the rising expectations of the occupiers. A little over 1 million dwellings of unconventional types and materials were built, mostly by the public sector, to speed house building. There has been a higher incidence of problems with these houses, but again we should keep a sense of balance. We must not damn more than 1 million buildings on the basis of problems with a limited number of the very many distinct types.
First, there are the 170,000 houses built of prefabricated reinforced concrete before 1960. When they were built there was no reason to believe that this material would not produce a house comparable to one built on conventional lines. To date, these houses have been excellent homes for very many people. The Building Research Establishment's recent studies show that many will continue to be safe and sound for a considerable number of years. The structural members are, however, subject to gradual deterioration which cannot be halted altogether. In these circumstances, private owners have a special difficulty, because the remaining life of the houses is not sufficient to justify a substantial mortgage and an 731 unmortgageable house is seriously devalued, if not unmarketable.
I think it was the noble Baroness, Lady Fisher, who asked about grant-aiding owners of system-built houses where they are facing damage and dereliction due to their specific method of construction. We intend to introduce a Bill as soon as possible to introduce a scheme based on that for Airey house owners, to help qualifying owners of houses sold by public bodies on the basis of values which did not reflect defects, or potential defects, not discoverable by normal survey at the time of sale.
The 150,000 prefabricated reinforced concrete houses which remain in public ownership will gradually have to be repaired or replaced, if that is required, but the Building Research Establishment's findings suggest that this is not something which has to happen overnight. It is a medium-term problem which authorities can tackle over a considerable number of years.
I am concerned that the House wishes to hound us into panic measures which are not appropriate; into a crash programme of immediate and massive expenditure which, unless special arrangements are made, will eat into the Housing Investment Programme resources which are needed for other purposes. Some expenditure will be needed in the next few years, of course, and I readily admit that. As I said in answer to a supplementary question on Monday, the provision made for housing capital expenditure in 1984–85 has been fixed in the light of that and other needs. We shall also be looking with the local authority associations at the general needs index formula of allocation to assess whether any changes are needed. In the end, the message must be the same as with nontraditional houses built before 1960: assess the problems objectively, do not undertake expenditure before it is needed and do not assume that housing of different, if similar, types, or even other houses of the same type, will automatically suffer from the same problems. All will depend on the cause of the problems.
I have had to cover very quickly a great deal of ground with, I agree, several interruptions which have been brought entirely upon myself, and I must apologise if I have not be able to do justice in the time available to the points made by some of those who have spoken. In closing, I want to make two points. First, the role of public policy in maintaining and improving our housing stock lies in giving a lead to and facilitating private investment. Secondly, where public resources are being spent, the point is to make sure that they are used efficiently and to help where the need is greatest. I am absolutely convinced that in some of the cases which we have been hearing about in this debate the need is very great, but I am not convinced that the totality of the problem is as has been described by noble Lords this afternoon.
§ 5.39 p.m.
§ Lord Pitt of Hampstead
My Lords, I am really disappointed by the speech of the Minister. The Government continue to be complacent about this issue. It is not that houses have deteriorated because you are not spending enough money now. They are 732 deteriorating and the deterioration will not be checked unless you spend more money than you are spending now. We are not asking for a rush programme. What we are asking for is that expenditure on housing should be increased. Expenditure on housing is steadily being decreased. I hope that when the Minister talks with his colleagues they will think again, because we need a new and different approach.
I am very grateful to all those who have taken part in the debate. May I congratulate the noble Lord, Lord Cornwallis, on his maiden speech and thank him for the way he explained the building society scheme. I had read about it and was attracted by it, so I was glad to hear about the details. I am grateful also to my noble friends Lord Dean of Beswick and Lady Fisher of Rednal for dealing with industrialised buildings, in particular the post-1960 buildings which are in need of urgent attention. I was sorry that again the Government did not take on board the point made by my noble friend Lord Dean: that the local authorities will be unable to tackle the problem unless the Government give them more help than they are recieving at the moment.
I agree with the noble Baroness, Lady Stedman, that all-party agreement is needed on a programme for preserving, renovating and renewing houses. We do not necessarily always have to have a party battle. This problem concerns all people and we ought to be able to agree on the way to deal with it. I am grateful, too, to the noble Lord, Lord Byers, for underlining three important points: that increased capital spending on housing makes good economic sense; that bad housing causes severe social stress; and that the longer you delay improvement the more expensive it becomes. Those are three points which the Government had better take on board.
Finally, I say to the noble Baroness, Lady Gardner of Parkes—an old friend of mine from County Hall—that I am not suggesting that we should merely clear. I have always made it quite clear that we ought to rehabilitate wherever we can and that we should clear where this is necessary. That was my suggested programme.
As for the question of mortgage tax relief, everybody runs away from it, but I am not going to do so. Mortgage tax relief is housing expenditure and must be regarded as such. When you do so you recognise that this country is not spending money in the best possible way. Because of that fact I believe there is need for reform. Having made those points. I beg leave to withdraw the Motion for Papers.
§ Motion for Papers, by leave, withdrawn.