§ 2.57 p.m.
§ Lord Winstanley rose to call attention to the economic and social implications of the housing situation; and to move for Papers.
§ The noble Lord said: My Lords, noble Lords have listened to my speeches on health matters with kindness and forbearance. However, today, I turn to a subject which I know from my own professional experience is closely related to health. It is housing. A well housed nation is likely to be a healthy nation, but a badly housed nation is certain—not likely, but certain—to be unhealthy.
§ The evidence for that statement abounds. I shall not catalogue it. I remind noble Lords that the Black report on Inequalities in Health demonstrated beyond dispute that bad housing was at the root of the high mortality and morbidity rates among the underprivileged in our urban areas. Nor should we forget that it was improvements in housing and the consequent reduction of overcrowding which began the defeat of pulmonary tuberculosis, a disease known as the captain of the army of death at the turn of the century, but now hardly a threat at all.
§ In my maiden speech to your Lordships almost 11 years ago, I acknowledged that builders and plumbers have done more for the public health than all the doctors put together. What are the builders and plumbers doing today? There are approximately 400,000 construction workers unemployed, costing the nation about £2½ billion per year in social security and lost tax revenue. The biggest single contribution to a reduction in unemployment is staring noble Lords in the face—a resolute attack on the housing problem.
§ Building houses is labour intensive. Repairing or modernising them is more so. Virtually all the materials needed, except timber, are home produced so that there would be no burden on our balance of payments and little danger of excess demand producing inflationary pressure.1151
I remember the early 1930s, when the construction industry was in the doldrums and unemployment was rising alarmingly. A housing programme with the building of large estates to rent in urban areas put the construction industry back on its feet and dramatically improved the employment situation. Many noble Lords here today were concerned with that work. It left us with some excellent houses and an example which we should now follow. However, the Government appear to have only one aim—how to increase the proportion of owner-occupied housing. They have always been honest about that. Indeed, away back in January 1985, the expenditure White Paper stated flatly:
The main aim of the Government's housing policy is to increase the level of home ownership.
There was a time when I shared that aim. I believed, as did many, that the division of our society between those who owned houses and those who never would own houses was damaging; but that was at a time of full employment. It was also before the rocketing of house prices which took place under the chancellorship of Mr. Anthony Barber, as he then was.
§ But things are different today. True we have a larger percentage of owner occupiers (over 60 per cent.) than any comparable European country, but with that we have acquired a record level of personal debt of which the burden of mortgage interest and mortgage repayments form a substantial part. Evictions are family tragedies, and some of them have been brought about by people being persuaded to buy houses when they cannot afford to do so. My citizens advice television programme in the North receives about 1,000 letters every week. For years and years housing has been the main subject, but in recent months it has been rivalled by debt, and the two are closely related.
§ The real need today, and it will remain the real need so long as unemployment remains high, is for rented accommodation. That was clearly demonstrated by the inquiry into British housing carried out by the National Federation of Housing Associations under the chairmanship of the Duke of Edinburgh. The report of the commission of the Archbishop of Canterbury, Faith in the City, carried the same message.
With regard to cities, let us not forget that the report by the noble and learned Lord, Lord Scarman, into the riots in Brixton showed clearly that much of the trouble arose directly from bad housing. My investigation into the Toxteth riots told the same tale.
§ Now let me give some figures. The Minister will accept them as accurate because he gave them to me in answers to parliamentary Questions. I thank him and his staff for giving me the Answers to the Written Questions so quickly. Had the Government wished to hide the facts, they could well have sat on the Answers until after the debate, but the noble Lord did not do so and I am deeply grateful to him.
§ In April this year there were 1,351,000 families on local authority housing lists in England alone—a staggering figure. It is one which is not likely to be reduced when council house building programmes have nearly ground to a halt. In the year 1985–86, 110,000 families were accepted as being homeless and 1152 14,400 households were placed in bed and breakfast accommodation at a cost to the nation of £26,200,000. That does not include Scotland. That is £26,200,000 and not a brick laid. The economic folly of such an arrangement baffles all understanding. And all that at a time when nearly 700,000 houses in England alone were unoccupied There were 110,000 families homeless and 700,000 houses unoccupied. If that were not tragic, it would be laughable; but it is no joke to the people who have nowhere to live.
§ What have we done to bridge that gap? We have the mobility schemes—two national and one regional—to help people to move from one housing authority area to another. I commend those schemes, but as the Minister knows from Answers he has given to me they have not been an oustanding success, partly because the places out of which people want to move are not often the places into which other people wish to move.
§ As to mobility, I must turn to the ever-widening gap between North and South. Much has been said about the economic aspects of that gap, but the housing situation is widening it. The cost of housing in London and the South-East is now such that our whole pay system has come under threat from the need for a London weighting allowance. Only recently, the London Standard carried a banner headline on its front page: "London office pay rockets." It went on to say that white-collar staff had increased by as much as 23 per cent. in London weighting payments alone. London weighting payments are all very well for those who have any pay, but there are no weighting payments for the unemployed and the pensioners.
§ What about those in the North and elsewhere who seek posts in London? Talented young people from the North who want to get their feet on to the bottom rungs of the ladder of success find that the ladder is in London. If they are lucky enough to be appointed to a job, they cannot take up the appointment because they cannot find anywhere to live. So much for Mr. Tebbit's bicycle! That works in reverse. Schools and hospitals cannot recruit well-qualified staff because of the difficulty of finding anywhere to live.
§ Students all over Britain have a desperate housing problem and their parents know that many live in squalor, exploited by Rachman-like landlords. How students manage to live in London, defeats me, and it defeats many of them as well. That brings us to the deplorable situation of houses in multiple occupation, a subject upon which CHAR has done such admirable work. I shall say no more about that because I have no doubt that other noble Lords will touch on it.
§ The real need is for houses and flats to rent. To provide them, we need a rent structure which aims at covering costs with the help of a much fairer distribution than we now have of the total financial support-tax relief, subsidies and benefits. My, noble friend Lord Banks will deal more fully with that matter. I suspect that he is the only Member of our House who fully understands our muddled and chaotic housing benefit system.
§ Housing for rent is provided by local authorities which in many cases are far too big and bureaucratic to do the job. Evidence of that bureaucracy abounds. Housing for rent is provided by housing associations and by private landlords who seem now only to 1153 provide houses or flats which no normal people can afford, and by housing co-operatives, of which I hope we shall have many more. With the new freedom that we have given to the building societies, I entertain a hope that we may see some of them reverting to doing what they were originally set up for—building houses. Some may even consider building houses and flats for rent. To do that they would need to discusss the targeting of subsidies and benefits with the Government.
§ To sum up, our present housing situation is endangering the nation's health; it is contributing to the breakdown of law and order and the escalation of vandalism and crime; it is deepening the gulf between North and South; it is obstructing the re-establishment of manufacturing industry in parts of the country which need it and it is condemning millions of citizens to live in conditions which should not be tolerated in a developed, industrial nation.
§ It is a crisis. If the Government are tempted to reply in the memorable words of Mr. Callaghan, "Crisis! What crisis?", I suggest that they will deserve the treatment which was meted out to Mr. Callaghan. My Lords, I beg to move for Papers.
§ 3.8 p.m.
§ Lord Gisborough
My Lords, there is no doubt that the housing situation in this country is far from satisfactory. I should like to give some figures from my area of Cleveland, which is probably typical of some of the more depressed areas. There is extensive disrepair in much of the mainly private housing stock. That is a growing and major problem. In Middlesbrough, for example, over 1,000 properties are unfit or lack basic amenities. In a recent survey of 10,000 properties in the inner city, 10 per cent. were found to be in a state of substantial disrepair and 64 per cent. had defects in their main fabric.
In Langbaurgh, where about 29 per cent. of the housing stock is pre-1914, 950 dwellings lack basic amenities, and without improvement and repair they will deteriorate to the state where they will become unfit. There is a similar story in the other districts. The public housing picture is not much better. In Middlesbrough, 1,000 inter-war houses need improvement and some 1,500 dwellings of the 1950–70 vintage need upgrading. In Langbaurgh, some 4.700 are affected by shale and have slag filling beneath the floors, which makes them unstable. There is a similar story in all the other areas.
Of the numbers of houses that are in serious disrepair it was stated in the Duke of Edinburgh's report that this number increased by 20 per cent. between 1976 and 1981 and the situation is getting worse. The number may well have reduced in the last six years since this Government have been in office. I hope that the Minister is able to tell us that that is so. Added to the condition of the houses there is the great mismatch between household needs and dwelling types. There is an increasing demand by single people wanting accommodation. In the whole country the demand by single people vastly exceeds supply.
There have been many initiatives recently, such as the low cost home-ownership schemes, equity sharing and land discounts. The housing associations are 1154 playing a great part. Council house sales, I believe, have had their good effect. Indeed many council estates are being sold en bloc to private developers to improve and repair. Many of these schemes may help a lot but there is no doubt that when houses are sold to the private sector the initial enthusiasm of the new owner involves their being repaired and improved. However, I wonder what will happen in years to come when many of those occupiers cease to work and become old. Shall we then reach the stage where some of the less well built houses will be too expensive for them to maintain? Will they increasingly go into disrepair? There are always problems of the increasing expense of repairs and of the unscrupulous repair gangs. It will be necessary for governments to continue to give grants to ensure that these privately owned houses are not only repaired but that their condition is maintained.
In the 19th century many of the houses were extremely well built. They were soundly built, but in this century they became out of date. In Skinningrove, not far from my home, there were well built terraced houses which were repaired and improved with new bathrooms. They were first class houses as a result. To my mind that has been a very much better answer than what so often happens—that they are simply pulled down regardless and either high rise buildings or vast council estates are built, with the problems that they bring both by splitting up families, splitting up the discipline of streets and very often leading to lawless jungles.
I thought that the most interesting report was that of the inquiry chaired by the Duke of Edinburgh. It is very well written, easy to read and generally a superb document. It is a non-political approach, which is very refreshing. The report dealt with the need for good housing and the ability of people to pay for that good housing regardless of politics. I hope that we shall all rise above our political prejudices to see whether the proposals in that document can be put into effect, because I believe they would be very successful.
In particular, the concept of encouraging private enterprise to go into the housing market is useful. I quote one paragraph:The City institutions seeking investment opportunities could and should be attracted on a large scale by the opportunities in residential letting … so long as rent levels reflect a fair return on capital—around 4 per cent. inflation-proofed—pension funds, insurance companies and others could put money into financing new homes just as they do for new offices. and building societies could extend their investment from owner-occupation to rented housing. This new flow of finance would then be available to all reputable organisations—local authorities, private sector landlords, housing associations and other non-profit organisations—to meet some of the acute housing need we have identified".One must not read that without remembering that the report also introduced the concept of grants to individuals rather than to bricks and mortar.
That report highlights many problems and offers many solutions. For example, it highlights the problems of security of tenure. It also exposes many anomalies. It is interesting that while it is different in concept to the present housing policies it was a unanimous report by a diverse group of people. I hope that the Government will see what they can do to implement its provisions.
§ 3.16 p.m.
§ Lord Houghton of Sowerby
My Lords, the housing slogan we have heard most in recent years is that of the right to buy. We have heard very little about the right to rent. We have had a Building Societies Bill before your Lordships' House in which the competing claims of the right to buy and the right to rent were debated to some extent. However, I wish to dwell mostly upon the implications of the right to buy and the right to rent.
The right to buy carries with it a very heavy charge upon tax revenue. We are all aware of that. In recent years the charge on tax revenue has risen considerably. All this represents an indirect subsidy on house purchase. It is an open-ended charge on tax revenue and, as such, upon the resources of the country. I recommend that your Lordships read the report of the Pubic Accounts Committee published only a few days ago which describes some of the worries about the administration and the cost of the right to buy through mortgage tax relief. I do not want to dwell upon them. I shall say that the Exchequer has two worries in this connection. One is the verification of refunds of tax deducted from the interest paid made by the Inland Revenue to the lenders. The other is the test of the validity of a great many claims in respect of mortgages for home improvements. After all, home improvement is the condition, among others, of tax relief on mortgage interest. There are loopholes and serious flaws in administration in both those matters. They are dealt with in the report of the Public Accounts Committee.
But what is the right to rent? We are only just hearing about that. What are the implications? The Government have neglected the construction of houses to rent in recent years. We are now confronted with the position that to buy a house is virtually the only option for many people who are looking for accommodation. Many are not able to buy or to rent and they are "making shift" as best they can. A great many of them are becoming absolutely without hope. That is a quite shocking situation.
On the right to rent, I have another recommendation for further reading to suggest to your Lordships. It is an interview between Mr. David Lipsey, the editor of New Society, and Mr. Ridley, the Secretary of State for the Environment, in the issue of 7th November 1986. There we have a most fascinating disclosure of the workings of the mind of the Minister. He is giving very deep thought to the problem. The right to rent and the building of houses to rent raise far-reaching issues which we have not yet fully studied.
One issue is the basis of rent to be charged for the right to rent. Is it to be an economic rental or a subsidised rental? Are we to differentiate between the public and the private sector? Are the rents of public sector accommodation to be subsidised, but not those of the private sector? What about the security of tenure of rented accommodation, and other issues of that kind? How can we obtain a fresh stock of houses to rent without settling whether or not we are to have rent control and security of tenure granted to unfurnished accommodation?
It may be that we shall finally be forced, if we have the right to buy alongside the right to rent, to consider 1156 balancing the tax concessions for the right to buy alongside the demands for a reasonable rental for the right to rent. We may then be easily led to the conclusion that everyone has to be subsidised in their housing accommodation. That is where we may get to unless we pull ourselves up short and decide where this is leading.
None of that can be decided this side of the election. We all recognise that the Government have no wish to tamper with the mortgage interest relief for house purchase; except to deal with the question of whether two unmarried people living together can take advantage of the £30,000 limit of tax relief on the mortgage, whereas a married couple can have only £30,000 between them. That is an anomaly to which the Public Accounts Committee has referred and it should be justified if it is to be continued.
However, there is enough to occupy the minds of noble Lords—who probably have more time to consider these matters than many Members of another place—in deciding where our housing policy is to go. It will not be solved merely by saying that there are many unemployed workers in the building trade who want jobs and they ought to be set to work. Who will set them to work? Will they be set to work to build public housing or private housing—the right to buy, the right to rent? If so, can we know the economics of that before we consider the social implications? We have grave problems in this area. We are not facing up to the issues of rented accommodation in the private sector. We will not get back the private landlords until there is some economic basis for their investment. Are we to rely wholly on the right to rent public housing with no other right to rent anywhere, except at exorbitant charges for the diminishing private sector?
That is enough for my seven minutes. I have left a minute to spare for my neighbour.
§ 3.23 p.m.
The Lord Bishop of Southwark
My Lords, I very much welcome this opportunity to debate a matter of such fundamental concern to the whole country, and I should like to thank the noble Lord, Lord Winstanley, for his masterly opening speech.
Housing has moved up the public agenda over the past two or three years, and that has been noticeable in a number of ways. As your Lordships have already heard, there have been a number of well-researched reports, one being the National Housing Inquiry, of which I was a member. I was glad to hear that being commended by the noble Lord, Lord Gisborough. There have been numerous broadcasts and articles and we have again heard reference to some of those today. Those have been marked by a widespread agreement about the seriousness of the situation, including the continuing decline of the rented sector and the evidence that the housing stock is deteriorating overall. We have also heard about some of the fiscal and legislative measures needed to give the country a much clearer and more consistent housing policy.
In particular, many people are now more ready to admit, privately if not publicly, that we need reforms which will create greater fiscal neutrality between the various kinds of tenure. The widespread assumption that only council house tenants are subsidised by the 1157 state is at last being replaced by a more accurate perception of the facts. The noble Lord, Lord Houghton, has pinpointed this financial issue with his customary clarity and focused on one of the key issues; that is, whether one subsidises the person or the building. That is one of the main issues which must be worked at very hard over the next few years.
There have been some welcome changes at national level over the past few years. Those include the release of a little more capital into the housing pool and the approval of a new initiative by the Housing Corporation to harness funds from building societies and banks which will increase the number of housing association properties for rent. It may also pave the way for a real breakthrough in bringing private finance back into rented housing.
It has also been good to read about the work of organisations such as Care and Repair Limited which specialise in providing schemes to help old people in the private sector (as has been mentioned) with problems of house repair and improvements, so enabling them to stay put longer. I understand that there has recently been a Department of the Environment grant of roughly ½l million, which will enable this organisation to develop about 25 new schemes throughout the country. That is the good news. There are some signs of hope.
However, the overall position is very serious. It is focused most sharply in the growth of actual homelessness, especially in London and the South-East. There are now more people officially recorded as homeless in London than there were 40 years ago; and most lists are kept as short as possible. That does not include the even greater growth in the list of people who are single homeless and who are not officially recorded at all. It has happened because all parts of the rented sector have continued to decline except for housing associations—a process accelerated by the sale of council houses and flats and the partial closure of some hostels.
In the various debates on housing at which I have been present in your Lordships' House over the past six years, there has always been one recurrent theme: what will happen to the homeless or the less well off if the rented sector declines too far, especially in those places where the volume of council housing is relatively low and sales are popular at discounted prices? The answer is now becoming clearer and clearer.
I heard recently from the local vicar of a lady in a southern part of the Southwark Diocese, which goes down to Gatwick and nearly to East Grinstead. Her husband had left her and she and her child had to leave a tied house. She was due, therefore, to be evicted. Her local council told her they could offer her no accommodation whatsoever in that area but would try to fix her up with temporary accommodation—presumably bed and breakfast—in Thornton Heath or Wandsworth, ironically. In desperation, because she did not want her child to leave his primary school, she took a job in domestic service which happened to be available and gave her accommodation. Her case is one of three in that school alone, and it indicates something of the social cost of the growing lack of rented accommodation.
1158 In London itself, vast sums of money are now being spent to keep families in lodging-houses and hotels, as we have already heard. The number is still rising. Not many of us here would have found it bearable to bring up our families in one room when we were young. When stress is being placed on trying to improve the quality of family life, how can we feel unconcerned about a situation where such pressures are being put upon people who are often ill-equipped to cope with them?
If one stands at the top of the tower block in Guy's Hospital and looks south, one will see one of the largest concentration of high-rise blocks of flats and deck-access estates anywhere in Europe. In the attempt to clear large areas of decayed Victorian dwellings and house thousands of people on a relatively small amount of land, this generation has become landed with a new problem of daunting size. I have been inside a number of those flats and have walked round estates with boarded-up windows, squatters, vandalism and depressing surroundings in many of them—unless work has been done. However, it is becoming clear that things can improve if the money is found to make substantial repairs and major changes to the layout, if tenants are allowed to become more involved and if management significantly alters its style and efficiency. However, that extra funding is an essential part of the total approach. We cannot leave it out. We can see clearly what can be achieved by looking at some of the estates where the money has been forthcoming such as the Henry Prince Estate in Wandsworth.
It is not a question of throwing money at the problem, as is sometimes said, as if it could be solved without financial cost. The cost of human discomfort in such places is very high in human terms as well as in medical and social terms. Old people are afraid to go out at night. Muggings and threats, noise and squalor all lead to mental and physical illness, the break-up of marriages and so on. Racial prejudice tends to increase on such estates. In other words, the cost of doing little or nothing is very high, although it is not easy to measure.
There are two other areas of social cost about which I should have liked to have said something, although I do not have the time. However, I shall just mention them. The first area concerns what happens when young people are forced into the position of having to buy—and again this is an acute problem in London—and then of possibly going through all the agony of repossession. The second area which is emerging concerns the anxieties which are now felt by many council tenants about the possibility that they will be asked to leave their present homes and move somewhere else under the powers provided by the new Housing and Planning Act. The anxiety may be exaggerated, but that it is there is a message which is coming through loudly in many parts of my diocese.
An adequate supply of good housing, with some choice of tenure whenever possible, is a fundamental condition of stable community life. I am sure that that is a concept in which we all believe. In Christian terms, we owe it to our brothers and sisters to see that they have shelter and warmth just as much as food and clothing, for we are interdependent, and the homelessness that exists is a scandal in a prosperous and civilised society.
1159 There is considerable agreement—and this is a positive aspect—on all sides of the community about the way forward. There is already a great deal of money around in housing allowances and subsidies, but most of the time it is not going to the right places. Can we now take the urgent action needed before the human and the economic cost of our present housing situation becomes unbearable?
§ 3.33 p.m.
§ Lord Raglan
My Lords, I recently read in The House Magazine a profile of Geoffrey Lofthouse, who is the Member of Parliament for Pontefract and Castleford. He told of how he was one of several children of a farmworker who, with their mother, were evicted from their tied cottage when the father died young. They all had to live with grandmother—14 people in a one-up, one-down terraced house in a mining town. Nevertheless, he said that he had had a happy childhood. His story is a marvellous illustration of how the human spirit can overcome the direst material circumstances.
Such a story would not so easily be found today, although no doubt the right reverend Prelate would find another story similar to the one which he told. However, his story would not be so easily repeated because that type of story inspired the post-war mass house building programme, and that programme unfortunately coincided with what can now be seen by everyone as a horrific period of architecture, where the relentless pursuit of novelty and experiment took primacy over most other considerations. As a result, the houses have a dreary aspect and the layouts are muddled and depressing. As if that were not enough, well-tried building techniques were discarded or driven out of fashion, with the result that taxpayer and private owner are having to foot an enormous bill for repairs which should never have been needed.
I hope that I am right in detecting signs of a return to a more caring form of architecture and properties which are better built. Meanwhile, it is important to observe that that great housing programme did not solve the housing problem, mainly because the problem itself changed due to a relatively unpublicised fact which I consider should be better known.
Whereas in the 1950s and 1960s we concentrated on building two-, three- and four-bedroomed family houses, already in the early 1970s it was beginning to be seen that there was an unsatisfied demand for much smaller dwellings, and that was due to a steadily reducing occupancy rate of dwellings. I hope that the Minister has the latest figures, which I know vary from place to place. However, they show that countrywide the occupancy rate has reduced from over four people per dwelling in the 1960s to something around two-and-a-half people per dwelling in the 1980s. In other words, in the space of 20 years the demand for separate individual dwellings has almost doubled. Indeed, the noble Lord, Lord Gisborough, adverted to the demand for accommodation for single persons.
What has happened is that mother and father have kept their house, or it is equally likely that they have divorced, needing separate accommodation; granny has gone to an old people's home; lodgers are no longer in favour; and the grown-up children have split off each to their own flat. That is a socio-economic 1160 development which planners could not have foreseen any more than they foresaw the huge increase in private car ownership and failed to allow for it.
The reduced occupancy rate is responsible for a great deal of homelessness, in addition to complicating enormously the needs which must be addressed. People's circumstances are so various that they cannot and should not be coped with by 1960s-type blanket solutions. That is where housing associations come in. I hope that the noble Earl, Lord Selkirk, will say something more about housing associations than I have time to say today. However, they are major producers of houses to rent and could produce more. I do not know what to admire most about housing associations—their variety, their ingenuity or their dedication. Certainly without them the housing situation would be very much worse than it is.
The Government need to maintain wholehearted support for housing associations through constructive criticism, as well as encouragement, for if they are well run they are a most flexible and cost-effective instrument. The Government cannot depend upon private money to solve the housing problem. However, it is welcome that recently much more private money has been coming into public housing, bringing more ideas as well as more funds.
Ideas are just as important as funds. I wish to emphasise that we should not hold the belief that all that housing requires is money; it needs a great deal of sensitive thinking as well. We have seen the impersonality, desolation and sheer bad quality that money without thoughtfulness can buy. People deserve a great deal better than that and I hope that the Government for their part will direct a great deal of effort towards seeing that they get it.
§ 3.39 p.m.
The Earl of Selkirk
My Lords, we are all extremely grateful to the noble Lord, Lord Winstanley, for raising this matter for debate this afternoon. Even without taking up the full time allowed to him he has put his finger on the main point; namely, the question of rented property. I am also grateful to the noble Lord, Lord Raglan, for what he said about housing associations. As the noble Lord said, there is an immense future for housing associations—for their whole structure, for the manner in which they are handled and for drawing into the problem so many people who want to help and who have not previously found a way in which to do so.
We are drawing to the end of the century, and people will soon be making comments on what this century has done for housing. I think it is important to remember that in about the year 1920 Parliament accepted responsibility for housing policy. It is, if I may say so, very much we—if I may use the word rather sententiously—who carry the responsibility for what has happened. We can say that since that time we have trebled the stock of housing—22 million houses or so. We can say that the general standard of housing in most places has greatly improved. In a recent poll, about 75 per cent. of people said they were satisfied or very satisfied with our housing—I say that to show that this century has not been wholly empty—but that leaves some 25 or 30 per cent. of the population who are not satisfied.
1161 We have been through two world wars this century. We have built ships, aeroplanes, guns and tanks. We have more recently prided ourselves on the invention of aeroplanes like Concorde, the Spitfire and so on. Why have we not succeeded in providing this essential requirement for the country? What has happened to prevent us from doing so? Quite frankly, I think that we have had far too much legislation: something like 20 Acts of Parliament affecting housing have been passed in the last seven or eight years. If one goes back 50 or 60 years, the amount is colossal. What is the effect of this? It is to frighten people—certainly private money—away from going into enterprise, surrounded by regulations, and never quite sure what additional regulations will be added in future.
The problem is quite a simple one. We subsidise council houses. There is an element of subsidy, as the noble Lord said, in owner-occupation. In housing associations there is undoubtedly an element of subsidy. However, there is no subsidy for rented property. Anybody who knows anything about housing today knows that rented property is the first demand. I am certain that your Lordships will find that in any part of the country, as I did last week in Glasgow.
Why can we not solve that problem? What are we finding it so difficult to do? We have already had several reports on this. What is even more curious to my mind is that, if we go overseas, we find that the poorest countries have the highest rate of owner-occupation, notably, the Philippines, Bangladesh, India and maybe others, whereas the richest country in Europe has the highest rate of rented property, and that is Switzerland.
Why are we denying the right to people to have rented property? The answer, of course, is Rachman. But Rachman is no answer to any question at all. There are wicked landlords; there are wicked tenants too for that matter without any doubt. It is no good pretending that one can answer the question that way. We can find a way if we want to. If the House demands it, we shall get that way.
I do not want to press the Government too far, but I ask just this. Have the Government given any consideration to the next 20 years? I think that we shall need at least 2 million more houses. I believe that owner-occupation will not rise above 70 per cent. It is not a bottomless pit. We can see this happening all over the world and in no case, I think, is it much above 70 per cent. We have, therefore, to provide 30 per cent. I suggest to the noble Lord, if I may, that perhaps half that should be council houses and half market rented houses. Can he give us any indication that this is a matter that he is considering?
I find the greatest encouragement in some of the words of the Minister for Housing, Mr. Patten. He seems to me to grasp the essence of the very subject we are discussing today. I wish him good fortune, and I hope that he will succeed.
§ 3.44 p.m.
§ Lord Ritchie of Dundee
My Lords, I should like to add my appreciation to the noble Lord, Lord Winstanley, for introducing this important subject. I 1162 wish to speak briefly on an aspect of it that I think may have had too little attention over the years; that is, the effect of bad housing on education. I wish to speak in particular of one school of which I have some knowledge as an example of what I am trying to say.
This is a school in Bethnal Green. Bethnal Green is part of London where over the last 10 years there has been a considerable influx of Bangladeshi families. I have no doubt that some of your Lordships know that this has not been a very happy settlement.
These families have three grave social disadvantages. The first is language; they have very little English. Often the parents and grandparents have none and are dependent on their children for any sort of association with the outside world. The second disadvantage is that they are the victims of racist attack. The third disadvantage is housing.
The school about which I am talking is a secondary boys school, Daneford School, which has 650 boys, of whom 450 are Bangladeshi, and the number is going up. In this school between one quarter and one third of the boys are suffering from the effects of bad housing, which takes the form of overcrowding, substandard accommodation and temporary bed-and-breakfast accommodation, sometimes a long way from the school.
I should like, if I may, to give one illustration of the conditions in which some of these boys are living. It is the custom in this school that, when teachers suspect that a child is suffering from bad accommodation in the home, they investigate the matter, seek out the boy's home and tell the headmaster about it. On this occasion the headmaster himself went along with one of his staff, and they found themselves in what he described to me as a Dickensian situation.
There was a broken-down door between two derelict shops on which they had to hammer for about 10 minutes. When they gained entry they found themselves going up a narrow, rickety staircase, with the plaster peeling off the walls. When they reached the first floor they found a family of five living in two rooms. One room was the bedroom, where there were five beds, all touching each other, with very little floor space. The other was the kitchen where they found a pedal bin and a storage cupboard hoisted half way up the wall in an attempt to deter rats. The family was sharing a washroom with other families in the same building.
In conditions such as these, it is surely not difficult to realise that education takes a very low priority. The family is really concerned with survival. That includes any boy who might have been at this school.
This is in Brick Lane in Bethnal Green, and the year is 1986; it is not 1886. Bangladeshi families are particularly ill-suited to coping with the plight that they find themselves facing, first, as I say, because of the language problems; secondly, because that prevents them from being able to understand and handle the situation—to use a rather slang expression—and, thirdly, because they are essentially a rural people. They have come from a rural background and they are seriously maladjusted to the urban environment in which they find themselves. Lastly, they are very unaggressive by temperament.
1163 The headmaster was talking to me about a situation—and it is not just an isolated situation—in which a boy at his school was the only member of his family who knew enough English to go round to the authorities, the housing associations and the local council in search of accommodation. Imagine the stress that that boy undergoes when he knows that the whole family are depending on him. He may be only a 13 or 14 year-old, and he is tramping the streets during school hours and thus missing such schooling as he might have.
Another problem of course is temporary bed and breakfast accommodation, which may well be a long way off. I understand that in Tower Hamlets there is very little of it. The headmaster had occasion to interview one particular fifth-year boy who was constantly late for school in the morning. He discovered that this was because he was travelling every day from Heathrow to Bethnal Green. Homework is an impossibility in these circumstances. I asked one of the staff what they did about it and he said, "We forget it. It is useless attempting to set it".
There is one other aspect, and I have already mentioned this in passing. For these lads the streets are not safe. It is an area where the National Front are rather active and the boys' families do not like them being out at night. Particularly in the winter when darkness falls, what happens is that families lock themselves into their small homes, so that the stress and the over-crowding are prolonged by several hours more than they perhaps need be. The school does what it can. The headmaster has intervened with housing authorities on several occasions, twice successfully this term; so much so that I believe some of the local families were queuing up because they thought that if the headmaster was successful in one or two cases with his own pupils he could be successful with other families, and he therefore had to stop the process.
What worries me is that we have here a vicious circle. These people see the only way out of their tragic situation as being education, and yet the situation itself makes education difficult or impossible.
§ 3.53 p.m.
§ Lord Pitt of Hampstead
My Lords, I feel happy to be following the noble Lord who has just sat down because I am glad that he has brought some of the realism required into this debate. I am equally grateful to the right reverend Prelate the Bishop of Southwark for so doing. I need to apologise to my noble colleague Lord Winstanley for not having heard his speech. I can only assure him that I shall read Hansard. I apologise profusely for not being here.
In recent debates we have talked about government housing policy and we have done it on predictable lines. People like me speak about the frightful statistics of homelessness and the state of Britain's housing, and then the Minister replies by giving the statistics about the degree of ownership. It always sounds callous complacency to me. But when I think about it, and particularly when I read government announcements, I recognise that it is not surprising because the main aim of the Government's housing policy—and here I quote—is "to increase the level of home ownership". What that means is that dealing with homelessness 1164 and bad housing—about which people such as the right reverend Prelate the Bishop of Southwark and I keep talking—is a lesser priority; and that is the point. The growth of home ownership takes precedence.
It is those consequences that we need to face this afternoon. In the few minutes I have I want to try to invite the House to face them. Expanding home ownership is not an unmixed blessing. Increasing numbers of home owners with low or irregular incomes lead to increasing mortgage arrears, evictions and homelessness. The statistics for mortgage default show that to be true. The number of building society mortgages in serious arrears has risen dramatically over the past six years.
Furthermore, home owners struggling with a mortgage on a low income will also face difficulties when it comes to paying for much-needed repairs. And an increasing number of elderly home owners can neither do repairs themselves nor afford to hire others to do the work for them. The last official house condition survey found that owner-occupation had overtaken private renting as the tenure with the highest number of unfit dwellings. That is a point requiring concentrated attention.
Increased home ownership is not the answer to Britain's housing problems because of the existence of poverty. The poor suffer disproportionately from homelessness and poor housing. Records from Shelter's housing aid centres, for example, show that over half the people approaching them for help are unemployed. The Government's house condition survey shows that the average income of households living in unfit dwellings is only half that of households in satisfactory homes. The same survey shows that the majority of those living in unfit houses would be unable even to afford a loan to pay for repairs.
Ever-increasing levels of home ownership are not the answer because for many of those living in the worst housing conditions today, buying a home is not an option. Some of course are already home owners, but their houses are often in a poor condition which they cannot afford to remedy. A housing policy whose single aim is the growth of over-occupation has little to offer them.
I wish I could stop there. I have argued that a policy whose single and overbearing aim is to increase the number of home owners in Britain will not deal with the real housing problems we face today. But there is more to it than that. Increased home ownership does not simply fail to help the homeless: a policy of expanding home ownership at all costs, which is the policy at the moment, actually reduces the chances of those people of having a decent home.
First, let us remember that because of the links between poverty and bad housing the provision of good-quality rented houses has been vital to securing decent accommodation for the homeless and those living in overcrowded or unfit houses. That is the raison d[...]etre of the policies of having local authorities provide housing and of the existence of housing associations. But the Government's policy to promote home ownership does a little worse than that because they set out to make home ownership more attractive while renting has been made less attractive. By that I mean that rents have been forced up by cutting 1165 subsidies and housing benefit. Meanwhile, financial support for home owners has remained untouched. Investment in repairs and improvements for rented housing has also been restricted. Therefore the message is loud and clear: if you want to have a home, you have to buy it.
Figures for public spending tell the same story. This is the reality of what passes for housing policy today, and we see its consequences in the increasing numbers of homeless, in the rising bill for disrepair, and (may I say it?) in the increase in house prices. Let us not forget the human suffering which lies behind the statistics. Poor conditions, cold and damp undermine people's health, particularly among children and the elderly.
Strain and insecurity lead to anxiety and depression; relations between husband and wife are poisoned; and children are growing up emotionally scarred by homelessness. That is the daily damage that is being done. Encouragement of home ownership is not incompatible with a housing policy with the main aim of dealing with Britain's major housing problems. It is however a matter of putting each aim into perspective. In my view, the single most important objective should be to end the scandal of homelessness and bad housing.
I hope that when the Minister replies—I know that his heart is in the right place because we have chatted many times—he will be able to tell me that the Government have taken this on board and have recognised that the consequence of their policy is not what they hoped. The policy is in fact having consequences which are unacceptable. I hope that the Government will take steps to remedy it.
§ 4 p.m.
§ Lord Tordoff
My Lords, noble Lords will doubtless have realised that those speaking from these Benches in the debate initiated by my noble friend are trying to take a particular sector of housing and deal with it in the brief time that we have. I have chosen to speak about homelessness among our youth. I do so with a certain reluctance because this is a subject that I am sure would have been dealt with by a friend whose memorial service we attended this morning. I am sure that noble Lords will echo my sentiments that it is a great sadness that Lord Crawshaw of Aintree is not here to join in this debate.
There is enormous evidence of an increase in homelessness among the youth of this country, not just in the inner cities but throughout the length and breadth of the nation. Government and local authority reports, the advice agencies and other local surveys confirm this. The figures show that in 1985, in addition to the 93,830 families who were homeless, there were some 80,000 homeless young people. There were 50,000 in board and lodging, much of which was substandard.
Leaving home is important to young people. It is part of growing up, and the vast majority of young people leave home between the ages of 16 and 25. They identify the leaving of home as one of the most important events in their lives. The Review Group of the Youth Service found that 49 per cent. of children expect to leave home by the time they are 20, and 75 per cent. expect to leave home by the time they are 25. 1166 Furthermore 71 per cent. of them expect it to be very difficult to find accommodation or doubt whether they will be able to find accommodation at all. Actually, about 80 per cent. of single people are still at home at the age of 20, and 66 per cent. are still at home by the age of 23.
One hears people say from time to time that there would not be so much homelessness and that the problem would not arise if children stayed at home. I have a quotation which I think underlines the situation from the best possible source, the Prince of Wales, who said in March 1985:For young people, leaving home and gaining independence is an issue of paramount importance in their lives. This is complicated by the lack of housing and employment options open to them".The reasons for the problems and for the frustrations are clearly to do with young people's change of status in the labour market—the dramatic rise in youth unemployment, which reduces their ability to find employment, while adult unemployment reduces the family's ability to continue to support them at home. The steep decline in private sector rented accommodation has already been referred to many times. It has more than halved over the past 10 to 15 years.
The fact that young people do not qualify under the Housing (Homeless Persons) Act 1977, now superseded by the Housing Act 1985; the fact that local authorities traditionally give a lower priority to young people and, indeed, some local authorities will not register them at all on their waiting lists; and the fact that the 1985 regulations on board and lodgings restrict the maximum amount of benefit to the young and set a maximum of between two to eight weeks for a young person to claim benefit as a hoarder in any one area are dreadful problems for those under 26. I dare say that my noble friend Lord Banks will deal with that matter when he speaks in a few minutes.
Many landlords do not accept tenants under 18. Their belief, understandably, is that such tenants cannot be sued for the rent and that minors cannot enter into contracts or hold a legal estate in land. What, then, are we to do? I believe that the first and major step is a recognition of the problem. I believe that His Royal Highness the Prince of Wales, in highlighting the problems following upon what he has seen under the arches at Charing Cross, has given a welcome lead. He was greatly shocked, like many of us, by the sight of homeless children on the streets. Indeed, shocked we all are by the sight of people in good accommodation blocking the opportunity for him to purchase houses so that some of these children could be housed! I ask those people in Kennington who have very expensive houses, first, to examine their consciences and, secondly, to look at what is happening under the Charing Cross arches and to consider whether Crisis at Christmas is not something to which they can bend their minds.
There is a need for recognition by the Government, as has already been said. There is a need for recognition by the local authorities. Specific measures are needed such as an expansion of shared ownership as starter schemes; bringing in legislation in England and Wales in line with that in Scotland, where it is illegal for those under 18 to be excluded from waiting lists; 16-plus children to be treated as adults so far as 1167 tenancies are concerned; the repeal of the 1985 board and lodgings regulations; the extension of the provisions of Part III of the Housing Act 1985; and the taking up of Shelter's call for a wider interdepartmental review of the needs of young people in housing involving the Department of the Environment, the DHSS and the Home Office. This is not simply a responsibility of the Department of the Environment and the Minister for Housing.
As my noble friend has said, there are problems in schools arising from bad housing. There is a need for counselling of young people on the problems of leaving home. There is certainly a need for the Home Office to consider the aspects of homelessness that bear on increasing crime rates and, particularly, on drug abuse. But is it any wonder that young people, faced with a total lack of anywhere to lay their heads, seek the oblivion of the use of drugs? One may not applaud that, but it is a fact of life. This is not confined to inner city areas. I know that the noble Lord the Minister will agree with me that even in the fair town where he and I both live, there are problems of homelessness. It is an awful start to life to be faced, as a young person, with the possibility of having no home to go to. If this country does not tackle housing as a crisis then we are laying the seeds for a destruction of our society when these young people grow up.
§ 4.9 p.m.
The Earl of Halsbury
My Lords, I wish to deal with the sometimes heartless bureaucracy which administers the matters that we are debating this afternoon. In Danvers Street, Chelsea, an unpretentious little street leading from Paultons Square to the river, there are seven houses vested in the royal borough. Of those, Five are empty and two are occupied by four tenants apiece, all old ladies. Of those eight tenants, six are opposed to the rehousing scheme proposed by the royal borough. One was in hospital when the poll was taken and one, I think, was away with the fairies and had no opinion. I have a round robin from those six objecting to what was proposed and I shall place it in the Library. Most curiously, this hostility of six to none is transformed by the magic of local government double-speak into a substantial majority in favour of what the royal borough proposes, according to the correspondence, all of which I have studied.
The story starts in 1983, when the tenants were advised that their homes were to be refurbished, beginning perhaps in two years' time. They were promised that they would be fully consulted before any scheme was finalised. Such consultation was of course requisite under Section 105 of the Housing Act 1985 and the tenants were quiescent in the belief that it would be fulfilled. During the spring and summer of this year—that is, three years later—they were shown an exhibition of what was intended and what had already been put out to tender. At a subsequent meeting they were allowed to ask questions. No records were kept of that meeting, no minutes; there was no consultation.
In July of this year Councillor James Arbuthnot wrote to the residents' association saying:The precise consultation you were offered did not take place. For that, you are certainly owed an apology and I do apologise".1168 They are not owed an apology; they are owed a consultation. A promise is a promise, and this was more than a promise. It was a statutory obligation and the royal borough is in quite clear breach thereof.
At the meeting, where questions were allowed, the director of housing, a Mr. Kingsford, told these old ladies that rehoused old ladies did not last more than six or seven years and that their personal wishes were secondary to wider considerations. What tact, my Lords!
Meanwhile the tenants had evolved an alternative scheme which they submitted to two consultants who are prepared to be named and quoted—Peter Ford, the housing manager of the WRVS, and Mr. Michael de Styrcea of Chestertons. The latter is a consultant also to the Westminster City Council. He said that the tenants' plan was what he himself would have proposed to Westminster if the situation had been under its control and that it would have adopted it without hesitation.
The director of housing, however, refused to consider it on the false grounds that any variation would involve forfeiting the DoE grant in support of this refurbishing scheme, in which case the council would sell the property and rehouse the tenants more cheaply, seriatim in North Kensington, thus breaking up the little community of mutual assisting friends and neighbours, the eldest of whom is 91, one of whom has only one leg and another of whom is on two crutches. But they help one another, thereby saving themselves from being a burden on the rates.
What is one to make of this situation? Shakespeare said it, did he not?Man. proud Man. dressed in a little brief authorityMost ignorant of that he is most assuredHis glassy essence, like an angry apePlays such fantastic tricks before high heavenAs make the angels weep!".So much for that model of tact, Mr. Kingsford, the director of housing!
What is it that the old ladies object to in the council's plan? First, it gives them windowless bathrooms. These old people do their own laundry and they must have an open window to help dry it. Secondly, the small kitchen window is placed so that they must stand in their own light when confronting the work table. Thirdly, a lot of light is shut out of the living room; and, fourthly, the hot-water tank is to be located in the living room. The tenants' own plan avoids all these objections and the quantity surveyor whom I have quoted above says that it would be a little cheaper to effect than the council's plans.
But that is not the end of the story. Let us go back to 1983. The tenants were promised more than consultation. They were promised a month's notice when the time came to move them. On December 1st of this year—that is, Monday of last week—they were given one week's notice to be moved on December 8th. That was the day before yesterday. I intervened at this point with a call to Mr. Nicholas Freeman, the leader of the council, and asked him to take the situation into his own hands. He promised to do so. I added, somewhat icily:And you will write and tell me what you have done, won't you?".1169 He promised to do so. I have heard nothing since. Another broken promise! However, a messenger called on one of the tenants and asked her to tell the others that they could disregard the week's notice given. There was no official communication to the residents' association via the secretary or the chairman.
Meanwhile I had taken up the matter with the Department of the Environment and I had a letter from the noble Lord, Lord Skelmersdale, who wrote of the local authority:They, it seems, have conducted the appropriate consultations and have taken the decision to proceed with the scheme. They are quite within their powers to do so".He added that in these circumstances the Department of the Environment had no locus standi.
All that this means is that the noble Lord's officials believe whatever the local government officers tell them. There has been no consultation. What the residents have had is an apology for not having been consulted. If I may presume to give a bit of advice to the noble Lord, Lord Skelmersdale, he must develop an intuition for what not to believe. He then will be worthy of that paradigm, his noble predecessor—and I must sit down now—who, when I said, "The Serpentine stinks", got off his backside on to his sturdy stumps and went to smell it for himself. That is what being a good Minister means.
The administration of housing in the Royal Borough is manifestly slack, slapdash and arrogant. As a ratepayer, I object to those characteristics and I am grateful to the noble Lord, Lord Winstanley, for giving me an opportunity to say so.
§ 4.17 p.m.
§ Lord Winterbottom
My Lords, let me declare an interest, in that I am chairman of a small housing association. The association is young, small and innovative. I should be grateful to your Lordships if you would permit me to give a brief history of its first years—which leads up to a question which I wish to put to the Minister about the strength which the Government are proposing to place behind Sections 56 and 57 of the Housing Association Act 1985. Those two sections have the rubrics: "Applications for deficit grants" and "Payment of deficit grants".
In order to demonstrate the points I hope that again your Lordships will forgive me if I give a brief history of the events of the first years of this association. Two men for whom I have great respect mortgaged their houses and collected about£120,000. They set out to build starter-homes for young people, without any money being sought from the Government; it came mainly from their own funds, a merchant bank, the building societies and the usual clearing banks.
Their plan was innovative—and I shall not go into details—but it had great success and in the first four years approximately of its life they built over 1,000 houses for starter-homes for young people, without any money at all from the Government.
This caught the eye of the Secretary of State of the day and his housing adviser came to see us to ask whether there was anything the Government could do to help. We wanted to get into the Docklands and we 1170 said so. We obtained a site near Becton on which we could build 15 houses. Those houses were completed and we received over 500 inquiries for those 15 houses—which, I think, is an indication of the size of the problem facing young married couples.
Unfortunately, the Government also said to us, "Would you take over a certain site in the North of England, in Greater Manchester, which we wish you to manage and complete?". We, in our folly—I should say, "I, in my folly"—said yes. This is the point that was made by the noble Lord, Lord Winstanley. What we did not know was that the mores and the standard of living of the North made it very difficult to work on the same principles as those we had worked on in the South. But because the Government asked us to do it, we went on and did it.
This caused us very substantial loss because whereas, in the South, people, after a period of being tenants, bought their own houses and indeed in most cases people in our scheme have bought their own houses in the third year of occupation, in the North nothing like that happens. People seem to want rented accommodation, as other noble Lords have pointed out; and when the period of tenancy ran out they left. Vandalism was very great in Manchester and the surrounding area, and it caused us a great financial problem. We have overcome it but, with the very limited capital backing that we have, if we are to go on it would be of a very great help to us if the Government could assist us (as they seem to be willing to do) by inviting applications for deficit grants and the payment of deficit grants.
That is the real point I should like to put to the Minister. Can he tell the House what weight the Government are putting behind Clauses 56 and 57 of the Act? How much money are they willing to spend and how quickly are they willing to spend it? Perhaps I may just read the two clauses and stress what is of real interest. Clause 56 states:A revenue deficit grant or hostel deficit grant is payable to an association in respect of a period only if an application complying with this section is made by the association to the Secretary of State and is approved by him.".Subsection (2)(b) states:shall be in such form and contain such information as the Secretary of State may determine".Will the Minister, when he replies, give some indication as to whether there is some memorandum or some formula which is generally known, giving guidance on the form of the information required by the Secretary of State for deficit grants of this type?
I feel that the Government take this seriously, because Clause 57(1) states:A revenue deficit grant shall be paid in a single sum in respect of the period to which it relates.That means to say that there will be no tapering off but that they will pay if it is agreed. We now have over 1,000 tenants in houses built as starter homes and, if we could continue the work we have started knowing that there was some money to back us if we should run into problems again, it would be of great assistance.
It seems to be assumed that it is quite easy to build houses and dispose of them. It is not. Disaster can always strike; Murphy's law always applies. For that reason, any government hacking to assist a small 1171 housing association in a time of crisis will be extremely welcome.
§ 4.23 p.m.
§ Lord Banks
My Lords, my noble friend Lord Winstanley outlined the general situation with regard to housing very clearly and comprehensively. Other noble Lords have looked at particular aspects, and I should like to concentrate for a minute or two on the relationship between housing and social security. This is particularly important because of the increase in poverty in recent years—poverty amid comparative affluence. Those with incomes under 140 per cent. of the supplementary benefit level have increased by 42 per cent. since 1979: an increase from 11.5 million persons to 16.5 million persons. According to a parliamentary Answer, only up to one-thirds of that has been caused by raising the supplementary benefit level and the other two-thirds is due to other reasons, among which of course is unemployment.
Housing benefit is the principal means of assisting people on low incomes with their housing costs. Its introduction in 1982–83 was attended by considerable upheaval; and "upheaval" is the word used by the Social Security Advisory Committee in their report for 1984. In that report they said:We have been, and continue to be, concerned about the distress which has been caused to people claiming housing benefit by the difficulties which have arisen in the scheme.".Those difficulties were in part administrative and in part structural. We on these Benches objected to the transfer of the responsibility to the local authorities and the involvement as a consequence of both the Department of Health and Social Security and the local authorities, with two bases of assessment: one for those on supplementary benefit and one for those not on supplementary benefit. We criticised the complication and, as we saw it, the muddle at that time.
We also criticised the reductions in housing benefit in April and November 1984, which took place so shortly after the full introduction of the scheme. I believe that something like £250 million a year was knocked off the annual budget for housing benefit. However, we were glad when the Fowler proposals for social security included a simplified form of housing benefit with a single set of criteria for assessment. However, we regretted the Government's intention at the same time to reduce housing benefit expenditure by £500 million a year, or 12 per cent. of the current housing benefit expenditure. The Social Security Advisory Committee also objected to that.
It is true that housing benefit cost £4,600 million in 1985–86. as against £1,200 million in 1979–80. Of course one has to take into account inflation in making that comparison, but it is clear that housing benefit is one of the most widespread benefits. But, as the Social Security Advisory Committee say,It is targeted on claimants who for the most part have very low incomes indeed.".In their 1985 report the committee add this—and I think these words are very significant—It is important to keep the level of spending in perspective as being principally the result of economic factors and of a conscious policy of transferring responsibility for costs within the housing system. The increase in unemployment, the real terms increase in 1172 local authority rents caused by the decision to reduce subsidies for the dwelling and place more of the cost on the consumer; and the real terms increase in rates, stemming at least in part from cuts in the general level of rate support grant; these have played important parts in determining the present level of spending on housing benefit and the number of claimants.".That is what was said by the Social Security Advisory Committee, and we would certainly endorse that.
We know that most of the proposed cuts will fall on pensioners with low incomes. The total cost of housing benefit of £4,600 million in 1986–86 should be compared with the cost of mortgage interest relief at £4,750 million—almost the same figure. The housing benefit goes entirely to those on low incomes. The same cannot be said for mortgage income relief. There is a case for one system of assistance to cover both rent and owner-occupied property. The least that should be done is to confine mortgage interest relief to the standard rate of income tax, when some £320 million would be saved for other benefits.
We are also, concerned about regulations which we understand the. Government intend to introduce, which will seek to deal with unscrupulous landlords who raise rents, confident that housing benefit will meet the increase. The method proposed is to enable councils to withhold benefit from claimants. We ask whether it is right to put the penalty on the claimant rather than on the landlord directly. We do not think it is. The unscrupulous landlord, rather than the claimant, should be the Government's target. Perhaps the noble Lord, in replying, will be able to give the House further information as to these proposed regulations.
I have one final question regarding time-scale. As I understand it, the revised housing benefit system will come into force in April 1988. I should like to ask whether the Government are satisfied that the scheme can work smoothly from that date. One thing is certain: we do not want a repetition of the muddle and confusion which accompanied the introduction of housing benefit in 1982 and 1983.
§ 4.43 p.m.
§ Lord Ezra
My Lords, like other noble Lords who have spoken in this debate so ably introduced by my noble friend Lord Winstanley, I should like, in the very limited time available, to concentrate on one particular issue. The issue I should like to address is that of home improvement. During the course of this debate so far, we have heard of the very serious human and health implications of the housing situation in Britain today and of its impact on school children and on youth. All this stems from a condition of housing which is sadly wanting and which compares very badly with many of our Continental neighbours.
By now, your Lordships are well aware of the magnitude of the problem. Unfortunately, the statistics most commonly quoted go back to the English House Condition Survey 1981. I hope that the noble Lord, Lord Skelmersdale, when he replies, can tell us when we shall have the advantage of the information contained in the survey that is currently being undertaken. However, the figures of the 1981 survey are very easy to remember; they showed that, of the 18 million inhabited homes in England, one in four was defective in some way. The survey found that 1173 one in eight houses required major repairs and one in sixteen houses was unfit for habitation.
That is a very serious indictment of the condition of housing in Britain. Let us hope that the latest survey will show an improvement—although I must say that subsequent information does not suggest that this will be the case. The Department of the Environment, when it conducted its 1985 review of the condition of public housing, indicated that something like £19 billion would be required to put that housing in reasonable condition.
The National Home Improvement Council, with which I am closely associated, has recently worked out that if we took the whole of the housing in Britain, both public and private, something like £46 billion would be required to put that housing right. By "putting it right", I do not mean to luxury standards but simply to normal standards of habitation.
There can be no doubt about how large the problem is. Equally, there can be no doubt that this problem cannot be solved all at once. Nor can it be solved entirely by the efforts of government. We need to have a programme of strategy which will combine all the various initiatives over a reasonable period of time to correct this very serious disadvantage from which the nation suffers.
I should like to suggest four steps of a practical nature which can be undertaken to bring about this improvement over a period of time. First, so far as the public sector of housing is concerned, it does seem anomalous that on the one hand the Government should recognise as a result of their own survey that £19 billion would be needed to bring that housing up to standard, and yet that something of the order of £6 billion (which has been obtained from the sale of houses in the public sector) should be effectively frozen or held in reserve and not used to bring this much-needed improvement about. Perhaps the noble Lord can tell us what the Government's policy is in that regard and how they propose to bring into balance the two factors of need on the one hand and availability of a resource so far frozen on the other.
Secondly, there is the question of home improvement grants. I must say that the policy here has been one of stop-go. We had a big surge of home improvement grants in the period 1981 to 1984; indeed, in 1984 the level of such grants was in excess of £900 million. This stimulated people to improve their homes; it stimulated local authorities to ensure that, so far as the public sector was concerned, advantage was taken of these grants; it stimulated the manufacturers of building materials to extend their facilities and builders to extend their capabilities. However, subsequently the sums made available under the scheme were massively reduced and today they are of the order of £400 million.
This stop-go policy gets us nowhere. It is something we have suffered from in this country from time immemorial. Ought we not to have a settled policy in this regard? Ought we not to have a proper recognition of the need for home improvement? My recommendation is simply this: let us return to the 1984 level and let us maintain it until we have made a big inroad into this problem.
1174 Thirdly, there is the question of taxation. Taxes have two impacts: one is that they raise revenue, which is of prime interest to the Treasury; and the other is that they give signals. The imposition (I believe in 1982) of VAT on home improvements may, and no doubt does, raise some revenue. But it gives quite the wrong signals. It is an impediment to doing the kinds of things that ought to be done. I strongly recommend, as part of this programme for improving our homes, that reconsideration be given to the question of VAT on home improvements. I hope that the Department of the Environment, which is responsible for housing, will take up the cudgels with the Treasury, which is responsible for raising revenue. I hope that for once we can give greater priority to a social need than we give to a revenue need.
Finally, I think there is a need for special schemes in relation to particular areas such as inner cities. I am very grateful to the Government who have, in connection with the National Home Improvement Council, made additional resources available for neighbourhood revitalisation projects. There will be a further 25 schemes as a result of revenue made available by the Government.
Perhaps I may conclude by saying that we are, among industrialised countries, second rate in housing. We should not be second rate. We should get back to a first-rate position, and I regard that as a matter of urgent priority.
§ 4.39 p.m.
My Lords, may I declare an interest in that I am a builder. The quality of a person's housing is a prime component in the quality of his life. Yet vast numbers of people in this country live in inadequate and crumbling properties which are getting steadily worse. I hope that my noble friend Lord Ezra is wrong, but I fear he will be found to be right and that a reassessment will show that we are going backwards.
We seem to have no concerted plan for improvement and no over-all policy on housing that we can discern in our industry. During the last seven years, the building industry, essential to any improvement in the living standards of so many people, has been squeezed to the point where any substantial increase in workload will have to be brought in gradually and with careful attention to regional factors if skill and materials shortages are to be avoided and inflation contained. Although unemployment in the industry has been substantial, the figures quoted by my noble friend Lord Winstanley should be interpreted with caution, not least because jobs tend not to be in the same place as the unemployed.
Sufficient land must be made available in the areas where people want to live. In the South-East, the land element in the cost of a new house already contributes 30 to 40 per cent. of the total cost. By ignoring the problems posed by planning, first-time buyers are being squeezed out of the market and more and more people are being forced to look for rental accommodation, even though many of them would prefer to have their own homes. In 1982, 64 per cent. of purchasers of new homes were first-time buyers. By the end of 1985, this was down to 39 per cent.
1175 An overall and comprehensive policy on housing is desperately needed but it must not repeat the mistakes of the past. Among other things, rigid cost yardsticks on council house building ensured that demolished slums were replaced in many cases by housing of such a low standard that it is already unacceptable.
The policy must also take into account the changes which have taken place and which will take place in the composition of our population. This matter was mentioned earlier. The average size of a household has declined from 2.91 in 1971 to 2.56 in 1985. At the present time, only 28 per cent. of households consist of the traditional family grouping of a married couple with dependent children. Thirty-five per cent. of households consist of couples without dependent children or with no children at all. One-person households account for nearly 25 per cent. of all households. The expected growth in the numbers of the retired population will also need to be taken into account. It will accelerate the trend that I have described.
The major growth in recent years in the sale of sheltered accommodation for the elderly has proved the attraction of this type of property. But for many purchasers, it is not a feasible option. Housing associations as well as local authorities have moved into this field with considerable success, but much needs to be done. In Wales, a demand of 8,500 units has been identified and schemes for 1,200 are currently in the pipeline. However, funds available to the Housing Corporation are restricting actual construction to 500 units a year.
The only discernible housing policy of the present Government is the right-to-buy. It has certainly been a success in enabling many people who wish to own their homes to do so. It has also removed the maintenance of those houses from the public sector. But that policy does not begin to redress the huge problems which face us. Eighty per cent. of the funds released to local authorities from this scheme are not even available for spending on replacement or refurbishment of property due to the restrictions placed on the local authorities by the Treasury. Meanwhile, the total bill identified by the local authorities for their necessary expenditure on housing is a staggering £75 billion.
Of course, there is no possibility of such funds being immediately available. But the sum illustrates the scale of the problem. It is a problem that will get steadily worse unless a concerted and sustained effort—again, I agree with the noble Lord, Lord Ezra—is made to tackle it. This effort must be developed in consultation with all those involved including the customers—the householders—and the building industry. It will need to include better provision for training in the industry, sadly disrupted by the falling workload of recent years, and also the expansion of capacity for material suppliers, who will not be convinced by a short burst of pre-election activity of the need for a capital injection into their companies to increase output.
Housing is much too important to remain an instrument of economic regulation. It must be brought to the centre, its importance to the lives of so many recognised, and a housing policy developed that tackles the problems presented.
§ 4.44 p.m.
§ Baroness Seear
My Lords, it is clear from this debate that we are confronted by not one issue but by two. There is the immediate issue of the emergency, indeed I would say the scandal, of our present housing position. It is the scandal of people queueing for homes in the council sector; the scandal of homelessness; and the scandal of the decline of our housing stock due to lack of repair. I would add the serious fact that the housing position leads to an immobility of labour, an immobility of people. With housing cheaper in the North and in the West people cannot move to the South and the South-East where the jobs are. This hampers the development of our industry and prevents the development of our education service. For example, it is well-known that teachers cannot take jobs in London because they cannot afford the housing, and they must live somewhere.
We need to do something as a matter of urgency to meet the emergency that is upon us. If anyone is in any doubt about the scandal with which we are confronted, may I echo the words of my noble friend Lord Tordoff who said that one should go under the arches at Charing Cross. If anybody can do so as night falls without a sense of shame, it is time they looked at themselves very seriously.
Suggestions have been put forward as to what we can do. But there is, of course, one action that the Government could take, and could take quickly. It was referred to by my noble friend Lord Ezra. The Government have stopped local authorities spending the money they obtained from the sale of council houses. Will the noble Lord, when he replies, explain to me why, in terms of principle. accountancy or economics—and I agree they are not the same—it is proper for central government to sell capital goods in order to put money into current consumption but it is improper for local government to sell capital housing stock and spend the money either on replacing that capital stock or an renovating their remaining stock and, therefore, keeping it in better condition? I shall be very interested to hear the answer to that proposition.
I beg the noble Lord to find ways in which that money can be released, and released quickly, so that action can be taken immediately to begin the long task—because it cannot be done at once—of meeting the scandal with which we are confronted.
This is not only an emergency. It would be a great pity if, following this debate, with its many illuminating examples of what is wrong, we were distracted from the fact that what we need is a long term view and an agreed housing policy. Listening to the debate today, I believe that there is very broad all-party agreement that something needs to be done so that we begin not only to recover from the present deplorable housing situation but also to ensure that we do not get into it again.
Surely we need an estimate of what housing is required, and where. After all, unlike so many problems of planning, we at least know how many people there are, and we ought to be able to estimate what the likely housing requirement will be over the next two or three decades. We should look at ways in which we can overcome the problem of immobility, which is a serious economic handicap. We must look 1177 at the question of justice between house owners and house renters. That has been mentioned repeatedly by speakers on all Benches this afternoon. I do not pretend that it will be easy. Of course one cannot change the position on home owners overnight; but it is quite clear that there is no equity between the two groups. That needs to be seriously examined; and the need to examine it is recognised on all sides.
We need also—and, here again, I refer to the report from the Audit Commission to which the noble Lord, Lord Houghton, referred—to take into account the very serious deterioration in the value of the capital stock in housing. This is an extremely important national asset. If we do not carry out the repairs and renovations that are required, we are frittering away an extremely valuable national asset.
There are all sorts of reasons for it. It needs detailed examination. No doubt part of it is the over-encouragement to buy. People have bought optimistically, many of them only to find that they cannot keep up with their mortgage payments, or, if they keep up with their mortgage payments, that they do not have tuppence left over to cover the repairs and renovations that are necessary in order to keep the property in reasonable condition.
I should like to add that, if the Government would do something about interest rates, it would begin to ease the problem in an extremely practical way. However, at the moment I am talking about the long-term view. Can we not have some all-party discussions about this and find a common basis? Of course there will be some differences between the parties but—and I am sure that I speak for all parties when I say this—there is no difference between us in the conviction that we cannot tolerate the present housing situation and that we must find a way in the future to deal with the problems more satisfactorily than we have done in the past. Let us get together and tackle these very difficult problems and work out a programme so that we never again find ourselves in the disgraceful position that we are in today.
§ 4.50 p.m.
§ Lord Dean of Beswick
My Lords, I should like to join with other speakers in expressing my thanks and appreciation to the noble Lord, Lord Winstanley, for giving us an opportunity to discuss what, in a social sense, is probably the most difficult problem that is facing us at present.
Other speakers have made reference to the Duke of Edinburgh's report. I think that the last major debate on housing that took place in your Lordships' House was a most excellent debate on that very report. In that debate there was general cross-party agreement that something needed to be done very urgently and decisively. A couple of weeks ago—and I say this to your Lordships because I think it gives an insight into government thinking on housing—I was at the annual dinner of the Royal Institution of Chartered Surveyors. The guest speaker at that dinner was the Lord Privy Seal and Leader of another place, who spoke very briefly indeed about housing. The only subject he mentioned was the success in selling council houses, and he said that it was hoped to do better at 1178 selling flats because of the Bill that had just been passed.
That was all very well and I do not want to go into the question of the sale of council houses since enough has been said about it already, but he did not say one word about the people who have no homes or who are badly housed. I am sure it is true, as the noble Lord, Lord Winstanley, said, that in general the building industry and indeed everyone involved in building—private builders, the public sector and the trade unions—agree that we have the resources and that all they are waiting for is a change in government policy and finance to be made available which will enable them to get on with the job.
I think it was the noble Lord, Lord Raglan, who said that money was not the sole answer. I accept that, but there is no way that the present housing situation can be reversed without a huge input of government money. Many statistics have already been quoted but I feel it is necessary to go briefly through some of them because within those figures there are others which are rather shameful when we analyse them.
The number of families who are accepted as homeless by local authorities rose from 53,000 in 1978 to 100,000 in 1985. The latest returns are expected to show an increase to 120,000. That means that we are adding approximately 6,000 families a year to the list of homeless people. I say that as a nation we ought to be ashamed of that figure. It is an appalling reflection of what we have allowed to happen.
It has already been said that there are over 1 million householders registered on local authority waiting lists and that the numbers are growing each year. While not all of them may be considered as priority cases, they include over 200,000 families who are living in overcrowded conditions; a further 200,000 elderly people who require sheltered dwellings; 10,000 people who are in need of wheelchair dwellings; 53,000 one-parent households and over 200,000 families who are sharing accommodation. During that period (1979 to 1985) new house building by the public sector fell from 130,000 in 1975 to 33,000 completions in 1985. Although of course the private sector has gone some way towards making good that deficiency, it is no way nearly far enough.
It has also been estimated that £19 billion to £20 billion is necessary to put the public sector back into some reasonable shape—not in any luxurious way, as the noble Lord, Lord Ezra, has said, but simply doing necessary and urgent work. However, another factor which emerges is that the condition of private sector housing stock is in an even worse position. That has been said in these reports by people who have an expertise in the matter. An estimated £26 billion needs to be spent on dwellings which are unfit for habitation and in disrepair. Over three-quarters of all unfit dwellings are in the private sector, so it is true, as was said by one noble Lord who spoke a few minutes ago, that we are witnessing the dissipation and almost unbelievable destruction of what is possibly our most valuable national asset in social terms.
What has been the Government's answer to reports such as the Duke of Edinburgh's report? I have no doubt that on 2nd February we shall debate at length 1179 Faith in the City and that it will be a much longer debate than this one. I hope that by then the Government will have changed tack. I want to put to them some figures that I have available which demonstrate the Government's response to the local authority sector. As your Lordships know, the local authorities are governed by what the Government will allow them to spend and fund in the housing investment programme.
In the year 1979–80 there was a global housing investment programme allocation for the nation amounting to £2,800 million. In 1985–86 that figure was £1,650 million, which is a drop of over £1,000 million. That has not been obtained by accident but is a deliberate act of the Government in cutting money for the public sector—and then, my Lords, we start to beef about why local authority stock is deteriorating and very little work is taking place! That is the situation in which we find ourselves.
Obviously I do not wish to take up much extra time but I should like briefly to refer to a broadcast I heard on 27th November, which consisted of an interview with Mr. Peter McGurk, who is the director-general of the Institute of Housing. That is a professional body made up of 8,000 people who operate in both the private and the public sectors and who have no political axe to grind. Naturally he was being interviewed about the fact that the Prince of Wales would be opening an exhibition called Building Communities on the same day. He wholeheartedly welcomed the efforts of His Royal Highness but said that it would be a mistake to take that initiative out of context.
I end my remarks with a brief quotation from him:We can't get away from the need to invest and invest in our inner cities on a massive scale. and I welcome the initiatives that are being proposed this morning; but it can't be used to disguise the massive scale of the problem and the need for real government initiatives".The noble Baroness, Lady Seear, and some noble Lords have spoken about the unfortunate people who are homeless and who have to live under arches, and I have referred to the fact that their numbers are increasing by approximately 6,000 a year. Your Lordships' House will rise a week tomorrow for the Christmas break. We shall go home to our families, who are well housed, and we shall have a very fulfilling Christmas. Are we really being just, if we do not stop for a moment to think about those 100,000 families who are homeless? I think that their views on Christmas would be similar to those of Scrooge in A Christmas Carol.
I hope that the Government will listen carefully to this debate which has been instituted and opened by the noble Lord. Lord Winstanley, and perhaps next year we may find ourselves talking about the awful figures that have been quoted today having been reduced and not confessing that they are continuing to grow. It may then be that your Lordships' House will be seen as some kind of benevolent Father Christmas. It is time to act, and act urgently.
§ 5. p.m.
§ The Parliamentary Under-Secretary of State, Department of the Environment (Lord Skelmersdale)
My Lords, this short debate is a little like a jigsaw, a series of interlocking pieces in a box, and after the 1180 speech of the noble Earl, Lord Halsbury, I am, too. I do not object to that, because the usual debates we have on the narrow issue of numbers of dwellings and public finance are somewhat excitable and sterile. I am grateful to the noble Earl for allowing me to start at the point at which we in your Lordships' House usually finish.
As the House knows only too well, the problem is that many of the houses available for occupation are too often in areas where they are least needed or of a size and type for which there is little demand. In areas where the need for housing is greatest, far too much of it is standing empty and in some cases unusable. There are acute shortages, particularly of housing for rent, in high pressure areas such as parts of London and the South-East.
The majority of households have a wide range of choice of housing which they can purchase as home owners. But for those who cannot afford to buy their homes the range of choice in the rented sector, public and private, is much more restricted. It is this that needs our concentration now.
The noble Lord, Lord Winstanley, raised the question of labour mobility, and I am sure that we have all heard anecdotal evidence of unemployed workers from the North being unable to take up work in London and the South-East because of high house prices. I agree that there can be little doubt that this is indeed a factor influencing the free movement of labour. Increased labour mobility would improve the flexibility of the labour market as the economy expands and develops, but it would not of itself create jobs. There are probably relatively few vacancies in any part of the country that could not be filled from within the area. Nevertheless, we are keen to ensure that housing is available where people want it and at a price that they can afford.
One of the ways of helping to achieve this would be through a revival of the private rented sector, which has declined by more than 350,000 units in less than a decade. We have already taken some steps to create the necessary conditions for this to occur. In 1980 we introduced assured tenancies, which allowed approved landlords to charge free market rents. The Housing and Planning Act has extended the scheme to renovated as well as new property, and that should lead to a big expansion in lettings. We are looking at further measures which may be introduced in due course.
We all know that there are problems of poor stock condition in both the public and private sectors in some parts of the country. I agree with the reference of my noble friend Lord Gisborough to the report of the committee chaired by His Royal Higness the Duke of Edinburgh. Great progress has been made over the years in reducing the number of homes without basic amenities, but problems of disrepair have been growing. We shall need to await the results of this year's English House Condition Survey to see the extent to which extra public expenditure on the stock in recent years has made an impact on the problem. I can tell the noble Lord, Lord Ezra, that we shall release this as soon as possible.
The noble Lord argued that the extension of VAT at standard rates to house improvements and alterations 1181 in the 1984 Budget has hampered housing repair and maintenance work. This was a point of view that was expressed by the industry at the time. I suggest that it has proved somewhat in error. During 1984 repair and maintenance work grew by 3.2 per cent, and between 1983 and 1985 it grew by a total of 5.6 per cent. Over the same period new work increased by 3.8 per cent.
There have also been many arguments about the number of jobs created by a particular level of investment in the construction industry. Indeed, there are as many different views and figures as there are experts. Only policies which are based on those principles will secure the lasting jobs in the construction industry for which we all strive.
While there have been improvements in housing conditions during this century, there have also been, rightly, rising expectations amongst the population. Most of us want and expect a choice of housing. We want more privacy and more space. More of us want and expect to become home owners. The noble Lord, Lord Raglan, spoke about this. It is right that in a civilized society people should expect standards to improve. Nonetheless this provides added pressure on the rented sector.
As the noble Lord, Lord Ritchie of Dundee, pointed out, we now live in a multiracial society. The housing needs of ethnic minorities are an important dimension of housing policy. The issues of racial harassment and discrimination are, as I know from our debates during the passage of the recent Housing and Planning Bill, of great concern to the House. We must avoid the creation of ghettos of poor housing occupied by ethnic minority groups, which can only lead to feelings of bitterness and alienation from the rest of the community. I suggest that this is not normally a fault of the housing providers. I think it is widely accepted that we need a diversity of occupancy. That leads me at least to suppose that the way to achieve this goal is by better education. Teaching Hindu, Pakistani or whatever as primary languages, so downgrading English, is something that cannot possibly help. I was working in Zambia at the time of the highly successful "Black is Beautiful" campaign. I learnt then that we should listen to how the ethnic community speak of themselves, because understanding each other is the only way we shall get integration in housing or anything else. I accept the points that the noble Lord, Lord Ritchie, made when he was referring, with all his wisdom and experience, to education.
This leads to all governments seeking to give people a better choice of housing within the inevitable constraints of public expenditure. The way this Government have chosen to do it is by helping people help themselves. This approach has led, I suppose, to the inevitable intellectual struggles in the local authority mind.
It is a vast sea change for them to appreciate that being providers and managers of low rent houses is less appropriate in the run up to the 21st century. We should like to see them, as I am glad to say they are beginning to see themselves, assisting in the provision of a greater diversity in the rented sector, whether public or private. Maintaining those dwellings they own to a high standard and charging rents 1182 commensurate with that. To answer the noble Lord, Lord Houghton, it should be an economic rent.
The noble Lord, Lord Pitt, claimed that elderly owner-occupiers cannot afford to repair their homes. We accept that this is the position with some elderly home-owners who find the business of home improvements confusing and discouraging. We announced last month grants of up to £3 million to meet half the cost of establishing 50 new agency services offering advice and practical help to elderly people. As the House will recall, our Housing and Planning Act contains an amendment introduced by your Lordships, to remove the legal bar in those types of housing association which were not permitted to operate agency services.
The right reverend Prelate the Bishop of Southwark stressed the importance of improving management on our council estates. The Urban Housing Renewal Unit was set up last year particularly to deal with this problem and has made an excellent start. It has now visited 130 authorities and as a result 86 schemes have been approved, involving nearly £41 million of public resources, on estates all over the country. These schemes, which concentrate on improved management, best security and attracting private sector skills and resources where appropriate, will be of direct benefit to some 45,000 homes.
I can remember very clearly responding to the late Lord Crawshaw of Aintree in our last major debate in this House early in the summer. I said then that we had increased provision by £200 million and that we hoped it would be possible to secure further increases. It is of course a great sadness to us all that he is not with us today, but he would, I am sure, have been pleased to know that we have increased the gross provision for capital expenditure on housing next year by £450 million and in particular that we have increased resources for the Housing Corporation—a point which I will return to presently.
In addition to the £3.66 billion of public expenditure that will be used for housing next year, there is likely to be about £10 billion spent by private owners on their own dwellings. It would be wrong to expect all the £3.6 billion to be spent on repairs and maintenance. We also urge local authorities to give priority to the provision of housing for those with special needs which cannot readily be met by the private sector, although any distinctions continue to be eroded. The private sector is now meeting a wider range of needs than ever before.
The noble Earl, Lord Halsbury, pointed out that there are occasions when redevelopment has to take place. I agree that that has to be done with sensitivity both as regards the tenants and the existing use of the area in general. The law is clear that under Section 105 of the Housing Act 1985 the local authority must make appropriate arrangements to enable those of its secured tenants likely substantially to be affected by a housing management matter, such as the proposed renovation of dwellings in Danvers Street, to be informed of that matter and to make their views known.
The authority must take account of the views expressed in reaching its decision. That is not a tenants' veto. I refer the noble Earl to our discussions 1183 on that point during the course of the Housing and Planning Bill. However, within that parameter, consultation is a matter for the council. I was interested to hear the noble Earl say that, although it is the law, consultation did not appear to him to have taken place.
§ Lord Skelmersdale
My Lords, I cannot intervene or follow up the noble Earl's suggestion of a government inspector because I have no powers so to do. The law, however, provides two remedies. The first is the courts, which I accept are costly and may not be appropriate in this case—I hope that I do not receive a furious reaction from noble and learned Lords—or, secondly, through the local ombudsman. I understand that that case has already been referred to the ombudsman. In those circumstances, it would be inappropriate for me to comment further on the case.
§ Baroness Seear
My Lords, on that important point, and with regard to the shocking case related by the noble Earl, we take it that the people involved will be allowed to stay where they are until the ombudsman is satisfied. Is that right?
§ Lord Skelmersdale
My Lords, I shall have to write to the noble Baroness and the noble Earl on that point.
§ Lord Dean of Beswick
My Lords, the Minister mentioned the Housing and Planning Bill which we completed a few weeks ago. Is it not a fact that people from this side of the Chamber, not just from my party but others, warned the Government that activities such as those about which the noble Earl, Lord Halsbury, has been speaking would take place? That is why we thought there should be a mandatory ballot, paid for by the local authority. It would appear that the tenants do not have the protection under that Bill that the Government thought that they would have.
§ Lord Skelmersdale
My Lords, it would not be profitable to rehash the arguments we had at that time on the Housing and Planning Bill. The point is that whatever form of consultations one has—
§ Lord Skelmersdale
My Lords, I am sorry. I should not wag my finger at the noble Earl. I am not talking about the case to which he referred, but it would be inappropriate for the minority to have a veto.
The Government have become increasingly concerned at the growing evidence of the problems faced by people living in privately owned blocks of flats. We strengthened the rights of those tenants in the Housing Act 1980, but the report of the Nugee Committee, which we set up to look at the problems, showed that more needs to be done to ensure that blocks are properly maintained and serviced.
The report provides an agenda for further legislation in this important area. The Bill which we intend to introduce this Session will give tenants important new rights. The main ones are a procedure for asking a 1184 court to appoint a manager where the block has been neglected; the right of first refusal where the landlord wishes to sell; and in leasehold blocks, where the ground landlord has failed in his duties, the right to apply to a court for the right to buy out his interest; tighter control over service funds and insurance, and the right to be consulted about the appointment of management agents.
However, the number of reasonably priced rented units in the private sector continues to worry us. We shall put the greater portion of our efforts into that over the next five years. I agree with the noble Lord, Lord Pitt, that it is a matter of priorities. At a time when the expressed need of people was for home ownership, it was right to concentrate on that. Now that more and more houses are available to buy (some 160,000 a year are being built) we must concentrate on the rented sector.
The noble Lord, Lord Banks, made the point strongly that people in the rented sector have to pay the rent. The noble Lord asked me about regulations designed to prevent abuse of the housing benefit system by unscrupulous landlords. I am advised that evidence of such abuse is largely anecdotal. My department is currently discussing with the DHSS and the local authority associations ways of tightening up the system to prevent that abuse becoming more widespread. I do not consider that the answer lies in moves further to regulate the private rented sector. That would have serious consequences on our attempts to extend provision of accommodation in that sector.
The noble Lord also asked what steps we are taking to ensure that the system is ready for implementation in April 1988. I assure him that the Government are in close consultation with the local authority associations to ensure that all possible difficulties are smoothed out in good time.
I also agree with my noble friend Lord Gisborough and the noble Lord, Lord Davies, that many socially responsible private landlords would be prepared to provide rented homes if they were allowed to charge a rent which gave them a reasonable return on their investment. We have begun in the Housing and Planning Act—which extended the assured tenancy scheme in the ways I mentioned earlier—to bring responsible private landlords back into the market.
I accept that we need to introduce further changes when possible but, nevertheless, I am not so sure that the fifty-fifty mix that my noble friend Lord Selkirk spoke of is right. I agree with the noble Lord, Lord Houghton, on taxation. I shall take that matter up with my right honourable friend the Chancellor.
My noble friend Lord Selkirk asked whether the Government are looking towards housing requirement over the next 20 years. He suggested that at least 2 million more homes will be needed. I can tell him that at current levels of building more than 3 million new homes will be built by the private sector alone in that period. In addition, the public sector will continue to add its share of new provision, especially for those with special needs. I cannot predict what share of that new provision will be for rented accommodation. As I said, the Government are taking steps to encourage more investment in the private rented sector. I am confident 1185 that the developers will react positively to the new market opportunities presented to them.
Returning to the present, two specific initiatives have been granted additional resources for next year. The Estate Action Team, which as the Urban Housing Renewal Unit has already made tremendous progress in helping local authorities with the problems of their run-down estates, has been allocated £75 million for 1987–88, an increase of 50 per cent. on this year's allocation. The second initiative will, I am sure, be of particular interest to the House because it centres on the housing association movement and in its initial form is designed to help reduce the number of homeless families in bed-and-breakfast accommodation.
The Housing Corporation's approved development programme for 1987–88, the details of which were announced yesterday, has been increased by £20 million to allow for provision of £30 million to be spent on schemes involving the private sector. Under that initiative, housing associations will receive grant for no more than 30 per cent. of a scheme's cost, with the private sector making up the balance.
The £30 million or so of public investment will therefore lead to additional housing expenditure of about .100 million. I believe that that is an exciting breakthrough in the arrangements for financing housing association schemes. It is, I understand, similar to an Alliance proposal for a social housing sector, and I hope it will be welcomed by noble Lords in that corner of the House. A major priority for this additional money will be to provide, in consultation with the local authorities involved, interim accommodation for homeless families currently living in bed-and-breakfast hotels, the need for which we all deplore.
The noble Lord, Lord Winterbottom, asked whether guidance was available to housing associations to help them apply for revenue deficit grant under Sections 56 and 57 of the housing associations legislation. The answer is yes. I shall send him a copy thereof, and it would be appropriate if I were also to put a copy in the Library of your Lordships' House.
I cannot remember which noble Lord mentioned this matter, and I am rather surprised that there was only one, but the Government regret as much as His Royal Highness the Prince of Wales the death of the proposed homeless hostel in Kennington. There is a most regrettable increase in homelessness, much of which has been caused by social factors. For example, the proportion of those made homeless because of marital breakdown has risen by 25 per cent. since 1979. The noble Lord, Lord Tordoff, referred to the problem of youth unemployment and indeed youth housing. Young people are leaving home without fully appreciating the difficulties of finding alternative accommodation.
The right reverend Prelate spoke on homelessness more generally. I agree with this depressing analysis. However, we need to answer this question. Do we have the right mix of government and private provision? It is easy to say that there is not enough government money, but I welcome the appreciation expressed by 1186 the noble Lord, Lord Raglan, of our efforts to increase private sector money for this purpose; for example, in the recent Building Societies Act. While these factors leading to homelessness are largely outside the Government's control, we recognise that there is preventive work that we can do. We are therefore planning to commission research on the housing consequences of breakdown in relationships. In addition, as I said when we debated the Housing and Planning Bill, we shall be setting up a working party with the local authority associations to look at the implications for housing management in the public sector. Both these matters will result in future actions.
However, the House will want to know about the present situation. My department has also offered to those London boroughs with the most acute homelessness problems direct help through the Estate Action Team. Extra resources, as well as the team's knowledge and expertise, have been offered to authorities which can take immediate advantage of them to bring empty units back into use for homeless families. It is up to the local authorities whose need in this area is greatest to use the service which we have provided.
The noble Baroness, Lady Seear, asked about the £6 billion which the local authorities now have as a result of the encouragement which the Government have given them over recent years to attract capital receipts. My noble friends and I, over numerous debates and questions, have explained to the House that local authorities can spend their capital receipts over time on building and renovating houses.
Last year local authority capital spending on housing was £2.6 billion. Of this sum, .l billion—which I suggest is quite a lot of money—was funded from capital receipts which they themselves raised. I readily accept that they are not permitted by the Government to spend all their money at once. We are told by the economists that this would have dire inflationary effects. However, they do not lose this money. They retain it; and even with the 20 per cent. rule (about which the noble Baroness will know) they spend 50 per cent, within three years. If the noble Baroness wishes further information on that I shall have to write to her because I find it an extremely complicated subject to discuss verbally.
This has been an interesting, wide ranging and challenging debate. I have tried to put over the Government's belief that the main areas of our housing policy—to increase opportunities for home ownership and to provide greater variety and choice in the rented sector—are the most likely to bring economic and social benefits because they are based on providing the type of housing which people want. We admit there are difficult housing problems. These can only be tackled by the public and private sector working together.
It is easy to forget that in 1985 in England alone 160,000 dwellings were built, 110,000 public sector buildings were renovated and 245,000 private sector buildings were renovated, making a total of 515,000 dwellings in all. Public sector resources—although increased for next year—remain limited and must be focused on those parts with which the private sector cannot deal. In this way they will be used to maximum effect.
§ 5.26 p.m.
My Lords, the time has come for me to draw this interesting, and I believe very important debate, to a conclusion. I hope that it will prove to have been helpful, but time alone will show that. As much of the debate has been anecdotal—we have heard most important anecdotes from the noble Earl, Lord Halsbury, and the noble Lord, Lord Ritchie of Dundee—perhaps I may add my own.
It will not surprise noble Lords to learn that at the time my daughter was a student she regarded me as something of an expert on these matters. When she was housed with seven other students, paying very high rents in dilapidated premises in which neither the heating nor the hot-water system worked, she sought my advice. I advised her to call in the environmental health officer, and that she did. Some three weeks later she rang me in triumph and said, "Yes, he has been and has said that he is not going to tell the landlord we called him in. He is going to say it was a routine inspection and he has declared the place unfit for human habitation. That means the local authority will have to rehouse us". I said, "My dear, it means that the local authority will have a duty to rehouse you. It does not mean that it will do so. It means that it will put you on a housing list". As a result of seeking my advice on housing my daughter became homeless. I hope that my advice to your Lordships' House today may have more helpful results.
We have had some most interesting speeches. It has been demonstrated from all parts of your Lordships' House that this matter needs to be tackled on an all-party basis. It has also been emphasised over and over again in all parts of your Lordships' House that it needs to be tackled by the community itself. In that connection I should say a word of thanks for, and pay tribute to, the work of the community as represented by important organisations such as Shelter, SHAC and CHAR and other organisations working for the elderly such as Help the Aged and Age Concern, which do such splendid work in this field. I would not perhaps include them, but I would add the Churches in this area, because the work that they have done to spread awareness of the problems of homelessness and housing difficulties has been very important.
We have had interesting speeches from noble Lords in all parts of the House. Noble Lords have exercised a great deal of disciplinary restraint in making short speeches—
§ The Deputy Speaker (Lord Cullen of Ashbourne)
My Lords, does the noble Lord wish to withdraw his Motion?
My Lords, I beg leave to withdraw the Motion for Papers.
Motion for Papers, by leave, withdrawn.