Inner Urban Areas

HL Deb 21 July 1987 vol 488 cc1298-338

4.44 p.m.

Lord Dean of Beswick rose to ask Her Majesty's Government how they propose to deal with the deteriorating situation in inner urban areas.

The noble Lord said: My Lords, I should first like to explain briefly why I am putting this Question to the Secretary of State. I should also like to offer the noble Lord my belated congratulations on appointment to his new office. With no sense of sarcasm, I wish him success in that office, because it is an onerous and heavy burden. A difficult problem faces us as a nation. The noble Lord has the job of dealing with it.

We have just come through a general election which the Secretary of State's party won quite convincingly. Nevertheless, that carries with it serious responsibilities. The Government's manifesto, the words of the Prime Minister, the gracious Speech and subsequently the strong support in a completely non-political sense of His Royal Highness the Prince of Wales, encapsulate the concern of all about this difficult problem.

Noble Lords will be aware that over the past two years this and related subjects have been dealt with in depth in this House; more so than in another place. We had a first-class debate nearly two years ago on the report of the Duke of Edinburgh's commission on housing when contributions were made from all parts of your Lordships' House. The Motion was moved eloquently and with great feeling by the noble Lord, Lord Seebohm whose name I am glad to see on the list of speakers today. That was followed in February by the debate led by the noble and learned Lord, Lord Scarman, in relation to the publication Faith in the City, the Runcie Report.

Both those reports homed in on the problem with which we are now concerned. There was a great deal of agreement on what ought to be done. I do not want to go through the list of figures as regards the financial requirements required to deal with the problem. The figures have been printed and quoted over and over again. Because of the time factor—there is another Unstarred Question on the Order Paper—I do not think that there is any point in repeating the exercise. I shall refer to one matter towards the end of my remarks but I shall be quite brief.

Although the Question refers only to the inner cities, one cannot deal with an inner city problem on its own in a city. I take the view that the inner city is the pulse, the engine-room, of that city. I believe as do the Government—and I think that if my party had won the election we should have had to accept the fact—that the private sector has a considerable role to play in the refurbishment of the inner cities. I have been talking to a number of people about this subject. I gain the impression, as I have said before in your Lordships' House, that the Government may have to weigh their input much higher than that of the private sector. I repeat that I am now talking about the inner cities and not the rest of the cities.

I was surprised when I saw quotes in the Sunday Times, as I am sure was the Secretary of State at about the time of his appointment, stating that the Government were hoping to attract £4 of private sector money for every pound that they spent. I thought that that figure was optimistic; but on examination I found it not to be so and that the private sector has exceeded that input.

That is the inner city problem. I am a resident of a large city. I was brought up in another large city which has a tighter knit community. I visit my home city now and again and I do not like what I see. The heart is dying and there is talk of renewing it. However, there is a form of arterio-sclerosis spreading outwards. I left Manchester in 1982. I lived in a nice area about three-and-a-half to four miles from the centre, on the border of Denton. When I now visit that area, which is not very often, I can see deterioration setting in. Unless the Government take full cognisance of this disease, which is spreading outwards, we shall be swamped by it. I believe that it must be done concurrently with the issue about which we are talking today.

How is the problem to be tackled? I believe that it would be fatal if the Government attempted to impose a solution on local authorities. I think they certainly ought to ask the local authorities to participate and give them the chance to do so. It may well be that local authorities who were foolish enough to be obstructive have to be bypassed but I urge the Government, before it comes to that, to take local authorities into their confidence, discuss matters with them and give them a chance to make an input into their own situation. I am sure the Secretary of State is aware that although the docklands redevelopment and refurbishment scheme has been a success, it has not been free from substantial criticism by the people who traditionally lived in that area. They have complained about being given no part in decision-making, of being bypassed and of being priced out of the areas where historically they have lived for a very long time.

Having said that, obviously one of the largest problems in the inner cities and the near-inner cities is housing. In the main I am talking about the public sector where we are in a difficult situation. I do not think the Government's policy of offering participation or allowing tenants to opt out of local authority control will work, because in most of the areas we are talking about 50 per cent. or so of the tenants either receive social security benefit or feature in the housing revenue account to a substantial degree. I do not see them wanting to form their own housing associations unless somebody (such as the Government) will pick up the bill, because the type of person I am talking about will not have the money to do it. As I say, it is on record that 50 per cent. or more of such people are in a large number of inner city areas.

Therefore I put two questions to the Secretary of State in an objective manner. I know he has not been long in his present job but he must know of some ideas emerging about action to be taken. Is it the Government's intention to restore some of the cuts? I say "some" because I would not ask for all of them to be restored. If that could be done it would help local authorities to deal with their housing problems, and if it is not done in conjunction with the redevelopment of the inner cities it will be very difficult. The two are interdependent and should be done together.

However, I am not talking just about the public sector, because the area of housing which is causing most concern at the moment and which is deteriorating faster than any other is the owner-occupied sector. Sixty per cent. of the people in this country are owner-occupiers and the properties are deteriorating faster in the private sector because of the lack of finance on the part of the owners to keep their properties in a reasonable state of repair.

I am aware of the time factor, but before I close I should like to refer to another area of revenue which has always been available to local authorities. It is an historical fact that since 1979 the rate support grant to local authorities in general has been cut by £21.5 billion. I do not subscribe to the belief that local authorities in the main spend money stupidly. There are some local authorities who do some very silly things, but in terms of the whole picture the number is miniscule and has had no effect whatever on the situation we are faced with today.

If I may, I should like briefly to quote from two independent bodies who have given recent assessments of what has happened. The first quotation comes from Private Housebuilding in the Inner Cities, a report from an independent commission prepared for the House Builders Federation. The report is very extensive but I shall give a brief quotation: Whilst we note the Government's new inner city initiative, we were forcibly struck by the fact that urban regeneration, of which new private housebuilding is an essential part, requires very much more investment than at present. Increased private sector investment on the scale needed will be forthcoming only if there is, first, substantially more public investment". That is not a political document: it comes from a report prepared for the House Builders Federation and it underpins what we have been saying.

I also have here a document entitled Charter for Jobs. This report was issued during June and it says that in housing alone in this country an urgent need for £85 billion can be identified at present. The point I am trying to make is that one cannot expect the Government to wave a magic wand and produce something of that order. However, unless we start to mean what we say, to put our money where our mouth is and start to attack this deterioration in the inner cities that is now spreading outwards, we are doomed to failure. The social and financial costs of that will be both colossal and unbearable.

I have tried to put my questions to the Secretary of State in an objective manner. I am grateful to your Lordships for the intense way you have listened to what 1 had to say, and on the basis of that I am looking forward to the contributions of my colleagues and to the response by the Secretary of State at the end of the debate.

4.56 p.m.

Lord Bonham-Carter

My Lords, we must all thank the noble Lord, Lord Dean of Beswick, for introducing this subject, which is one of the utmost importance and one which we should pick up from time to time in this House. As he said, we last discussed it on 2nd February in a debate initiated by the noble and learned Lord, Lord Scarman. It was to me an extremely important and useful debate. I should like to add that I wholly agree with the noble Lord, Lord Dean, in his reference to the fact that we are not talking about inner cities only. Many of the outer cities suffer from the same problems as the inner cities, but this is now a term of art and when we talk about "inner cities" we mean also other areas suffering from deprivation. I should also like to say how glad I am to see the noble Lord, Lord Young, in his place today to answer this debate.

In the debate on 2nd February the noble and learned Lord, Lord Scarman, emphasised two particular points for our attention. The first was the importance of partnership, in particular partnership, as the noble Lord, Lord Dean of Beswick, said, between the Government and local authorities. Whatever the Government's plans, in my view they will not succeed unless they establish a proper partnership between central government and local authorities, which are after all the elected representatives of people living in the area.

I was looking today at a publication just issued by the Department of the Environment with the title Managing Work Spaces. I was looking at it in our leisure space in the Library and I found, briefly, that it bore out the point that in almost all the schemes which it studied and to which it gave particular praise the partnership between the Government and the local authority was very close and useful.

The second point to which the noble and learned Lord drew attention was the very real danger of alienation from what he called the mainstream of British life on the part of those who suffer most from the disadvantages of living in our inner cities; that is to say, the ethnic minorities.

On the same occasion the most reverend Primate the Archbishop of Canterbury emphasised the view of his commission that the nation is confronted by, "a grave and fundamental injustice"—those were his words—in urban priority areas. In the light of that debate, of what was said then and of what has been said just now by the noble Lord, Lord Dean of Beswick, I welcome the Government's interest in this problem of our inner cities. If it has been inspired, as some cynics suggest, by the desire to get votes in those areas, it does not shock me in the least. That, after all, is how democracy works.

Votes are to politicians what money is to businessmen. It was an American politician in the 19th century who said: Politicians are not men. They are hogs and you must hit them on the snout". If one wants to hit a politician on the snout the way to do it—unless he is a Member of this House—is to vote against him. If the Government's response to a rather poor vote in the last election from the inner city areas is to pay attention to them, all strength to their elbow.

However, in looking at those policies we must examine and probe the means that the Government intend to employ, their intentions and, if I may say so, their misconceptions. I do not want to be beastly to the noble Lord, Lord Young, but in answer to questions put to him by some Members of this House about the efficiency of British Telecom he said that it had produced a great deal more cellular telephones in the past few years since privatisation. I say in reply that cellular telephones or their analogues are not matters of great interest to the inhabitants of inner cities.

The criteria by which we must judge the Government's plans for the inner cities are those of public service and public interest. Those are the four words by which their policies must be judged. I should be happier if I heard them rather more frequently used by members of the present administration.

It is not true, as is sometimes said, that inner city problems have suddenly hit us in the past 20 years. They have been with us ever since cities developed and since the 18th century and the "rookeries" in London. Nor, I should add, are they confined to this country. They exist in the Bidonvilles of France, in Naples in Italy and above all in New York and Chicago.

In the debate on February 2nd, the noble Lord, Lord Young, did not convince me that there was any real connection between the amount of local authority housing and the intensity of inner city deprivation. What is true and undeniable is that in the United Kingdom, the United States and France the chief victims of inner city deprivation are the ethnic minorities.

It is the case—and this is the area on which I should like to concentrate—that unemployment among the ethnic minorities overall is double that found among the rest of the population. Further among ethnic minorities unemployment in the group aged between 16 and 25 is of the order of 60 per cent. in many inner cities. It is a pretty serious and formidable problem and one that we must confront.

Hence, when we consider the Government's plans and those plans become clearer, we must ask ourselves whether they will substantially change the disadvantage suffered by ethnic minorities in our inner cities. Some of those disadvantages are shared by other groups who live in the inner cities but some are due to racial discrimination. If those policies do not correct what the most reverend Primate the Archbishop of Canterbury called the "injustice" which those people suffer and do not take into account the huge public interest that is involved in dealing constructively with the problem, they will have failed and the danger of alienation from the mainstream of British life to which the noble and learned Lord, Lord Scarman, drew attention, will come much closer.

Race relations legislation is sometimes blamed for having failed to deal with the problem. I believe that that is to misunderstand the purposes and the expectations which the introduction of that legislation intended to achieve. It was hoped to state a position taken by society as a whole which condemned racial discrimination, and to provide governments—the present and successive governments—with a platform or launching pad to base and launch other policies. It was hoped that that legislation would be followed up by the Government setting an example in their own practice in the Civil Service, the nationalised industries and elsewhere, and that by setting such an example they would be able to lead industry, the trade unions and others to take positive steps to deal with this very serious and enduring problem.

That did not happen. For example, the introduction of monitoring in the Civil Service has only recently taken place, and I think I am right in saying that it was introduced in the Armed Services as late as last year. Another way in which the Government could have set an example would have been by insisting in contracts that they entered into with industry that the firms with which those contracts were concluded should pursue equal opportunity policies. This is particularly important in connection with inner city plans, especially the Local Government Bill, which was introduced by the Secretary of State for the Environment.

Arising out of that Bill I should like to put two questions to the Minister. First, will that Bill or will it not make it possible for a local authority offering a contract to insist on the employment of local people? That is one important question. Secondly, and equally important, will that Bill or will it not allow the local authority to carry out its obligations under Section 71(b) of the Race Relations Act 1976: to promote equality of opportunity and good relations, between persons of different racial groups"? Those are two crucial questions. If the answers are in the negative the objectives that lie behind the Government's inner city policies will be called into question and a great opportunity will have been missed.

I hope therefore that the Minister will be able to tell the House whether either the Chancellor of the Duchy of Lancaster or the Secretary of State for the Environment is correct in the differing interpretations of the Local Government Bill as recently reported in the Guardian and other newspapers. I believe that his answer will tell your Lordships how serious the Government are about tackling the problems of our inner cities and about promoting equality of opportunity irrespective of race, colour or national or ethnic origin. I hope that the Minister will give the House a clear and unequivocal answer to those questions. In my view that answer is crucial to the future civility of our society.

5.7 p.m.

The Lord Bishop of Durham

My Lords, I too should like to thank the noble Lord, Lord Dean of Beswick, for providing this opportunity, before we go into recess, to register with the Government some points to which we believe Ministers need to pay attention as they go ahead with various initiatives in the inner cities. I am grateful also for the opportunity that is thus presented to me to say on behalf of my fellow Bishops and indeed perhaps on behalf of the General Synod of the Church of England how glad we are that the Government have made that very important declaration of intent about the inner cities.

We do not claim any credit at all for it, not only because we depend upon grace and not upon works, but also lest it should discourage the Government, as they seem to feel from time to time that our interventions are a little off-putting. So we do not claim any credit, though we note the initiatives, encourage them and wish to be critical collaborators in their progress, in the hope that the Government will move in a positive and permanent direction. We are aware, as has been said, that the problems that we are tackling are intractable. We are not dealing with problems that have built up over five years; they extend over 100 years.

We are therefore not concerned with five-year projects to solve those problems but with initiatives that must become part of the plans and patterns of our national life for all the foreseeable future. It seems to me therefore that it is all the more important to place the initiatives which the Government are proposing to take and are developing in the broadest possible context and neither to expect too much of them nor to suppose that they will be sufficient or successful on their own.

I should like to draw attention to three problem areas, two of which have already been touched on, which I suggest the Government need to note and give very careful attention to as they carry on with their plans. First, surely, all ideology, political theorising and philosophical preferences apart, it must be absolutely clear that the thrust of private enterprise alone—and I stress the word "alone"—cannot be sufficient to rejuvenate our inner cities and our outer suburban housing estates and other troubled areas.

To build a viable and worthwhile society for the 21st century, out of what we must surely call the debris of the various industrial and political initiatives of the 19th and 20th centuries, must require a great deal of state activity and public investment as well as private enterprise. I should like to illustrate this once again from the housing area, because that happens to have come my way also lately, but also because I think it illustrates the wider issues.

For instance, in the speech of the president of the House Builders Federation there is this paragraph which I find echoed elsewhere: in many urban areas, where de-industrialisation and unemployment constitute the main constraints on the housing market, the public sector must also play a major role. The private sector cannot operate in areas where the existing residents cannot afford either to buy or to pay a full market rent. Nor can it create markets and attract people back to urban areas in which the environment is depressed, disfigured and presents no hope of change". This note is also sounded and made more broad in some notes which I took the chance of getting out of a local authority next to where I live, because I had recently been discussing with them how they and the church could collaborate in tackling some of these problems. This is part of the note I received: The Government implies that private developers can and will build the new homes needed in inner city areas. The Council has actively encouraged such private investment, by making available land and carrying out extensive works to improve the surrounding environment. Despite this, the private sector is loath to invest. Unlike the Docklands most inner areas are characterised by low, even negative land values, which render private investment schemes high risk, which even the Government's Urban Development Grant scheme has been unable to overcome. The cycle of deprivation is matched by a cycle of declining investment leading to disinvestment. Local businesses and private investors look to Government agencies and local government to generate the 'environment' in which to invest. The reduction in public sector expenditure in inner cities is providing exactly the wrong signal". That is from a local authority that I know to have been actively engaged in collaborating with private funds and so on in developing things.

There is also the same point made in the report to which the noble Lord, Lord Dean of Beswick, referred, where there is the remark that, The effective demand for new housing at market prices is low in most inner city areas. The fundamental need is for low-cost 'affordable' housing for the low income and unemployed groups who live there, and this in general means subsidising housing to rent.". This is a further point of great importance. The report goes on: In areas where the economy is buoyant the ability of inner city dwellers who are prospective owners to afford their own property is reduced by the increase in prices caused by the demand for new or refurbished houses from people on higher incomes. How do the Government intend to deal with what we might call the problem of "Yuppification"? It is clear that it is useless to behave as if the problems of the inner cities and the outer housing estates can be solved simply and solely by making money. Making money has its own very grave problems especially for people who simply cannot get in on the act either immediately or indefinitely. So the construction of a viable 21st century society must require very substantial state activity and very substantial continuing public funding, even if, or precisely so that, the market may do all that it can.

That leads me to my second point, which is that the revitalising of our inner cities and our outer housing estates must include a vital and continuing element of local trust and local collaboration. That is a point that has already been made but I feel it very urgently from my part of the world and I should like to stress it again. That must include a positive approach to, and a positive role for, local authorities.

Of course there are clashes of approach and principle—there are bound to be—and sometimes these clashes are foolishly and obstructively maintained on ideological grounds. But surely an aggressive approach to this, which looks as if it is equally ideologically motivated, is hardly the way to continue and is certainly not the way to build up the trust, the confidence and the working together which is essential. After all, all ideologically-determined policies and programmes risk stupid mistakes.

Secondly, central politicians and bureaucrats are not necessarily any wiser than local politicians or bureaucrats. If I may comment theologically in this House, it seems to me to be a matter of solidarity and sin. Central people sin centrally and local people sin locally, just as, I might add, religious people sin religiously. So there must be consultation and sharing and give and take, or things will go badly wrong.

Moreover, the people who are now in the depressed and deprived areas must have a voice, and must have a voice before they have the money to pay for their choices. Otherwise there may very well be great distress in such matters as inner city unrest and outer city vandalism. In any case, and even more importantly, surely we must mobilise the resources of all our people, which requires wide consultation and wide collaboration. So I would urge the Government to restore partnership to local authorities and be very careful to listen to local people.

That leads me to my final point, which is this. We all know that the problems of the inner cities will take a lot of solving and a lot of moving forward. While we are doing this, in collaboration, I hope, with the Government—critical collaboration, but collaboration nonetheless—I would urge the Government to pay particular attention to others of their policies which affect the people who are suffering now in these deprived areas.

The point that I should like to make is not political but strictly pastoral, and it is this. Will the Government please pay attention to what is actually going on in many inner city areas, because of the effects of the social security reviews, the new regulations and so on? They are undoubtedly making the difficult life of poor people very much more difficult. And will the Government please think very hard about the poll tax? Maybe they are clear about the principle of it and should press forward with it. But will they please think about the implications and applications, and see that it does not make worse-off people worse off in the name of a responsibility which, in any case, they cannot possibly exercise?

Will the Government please listen and consider the way housing benefits actually work? I simply have to testify that there is no doubt at all that on housing estates in places such as Tyneside, Sunderland, Cleveland and many other places in my diocese, as well as right across the country—this is not a North-South divide—the conditions of people in inner cities are being made worse by the application of government regulations. Therefore I hope that while we search forward in these difficult matters, the Government will urgently consider the balance of private enterprise and continued public funding which is required, the restoration of local authorities to positive roles and the need to be very sensitive about what is happening now to people who can do nothing but wait.

5.19 p.m.

Lord Bellwin

My Lords, it is a convention of the House that noble Lords sit in accordance with their political beliefs and allegiances. If anyone were to propose that that should be afforded as a privilege to the right reverend Prelates I should be glad to second it. I do not see why they should not have that same opportunity.

The opening speech of the noble Lord, Lord Dean of Beswick, was very good. It was temperate, responsible and touched on the problems that concern us. As your Lordships may know, he comes from Leeds. That must be very much to his credit and advantage. He made a telling point. I wonder whether he appreciated quite how telling it was. He said that he used to live in Manchester and that when he goes back there now from time to time he is unhappy at the deterioration that he sees. I am sure that he is quite right about that. I am glad that he did not talk about the deterioration in Leeds, because it has not deteriorated. It has its problems, as have so many other areas—I shall touch on that in a moment—but it has not deteriorated. It has become and is becoming better.

That is a key point, because over the last years one of the great problems which has bedevilled all matters pertaining to local government is that the situation varies so much in different areas. Trying to legislate to apply the same policies to each and every one in itself is a great problem, because that often means that one does things which need not be done and fails to do other things which need to be done. This problem is not easy to cope with, as I know so well from so many years of having tried to do so.

I find it hard to get away from the habit of trying to pick up on what previous speakers have said. Noble Lords may know that I did that for a long time. Therefore before I make my few remarks, while I also keep an eye on the time, I must say how much I agreed—unlike in the last debate-with so much of what the noble Lord, Lord Bonham-Carter, said, especially when he talked about ethnic minorities, discrimination and the need for equal opportunity. No one in your Lordships' House would quarrel with the points that the noble Lord made. The problem is how we do things to make happen what we all wish to see brought about. It is not easy, because when one discriminates positively one is still discriminating. People do not like discrimination, whichever way it may go. I am sure that the Government will take heed of what the noble Lord said on that because he made a fundamental point about something which is a great worry for everyone.

I have only one point to make as regards the noble Lord's remarks and I wish I had made it in the last debate on faith in the inner cities. My point is that there is still scope for people to help themselves. I think that history will show that other immigrant communities did a great deal to help themselves. People within them helped each other. They were obsessed with education. They came to a country deprived and with nothing, but they wanted to help themselves. They were very grateful for being received and for the help that they were given, small though it was, but they also helped themselves. I hope that the noble Lord, Lord Bonham-Carter, will not think ill of me for making that point because I believe it very passionately and it is part of the debate.

Where do we go from here? There can be no doubt that the problems exist and in some places they are worse than in others. This is not a political debate as such and I am anxious not to make political points if I can avoid it, but I am bound to say that there are areas where the deprivation and dereliction are at their worst and where, as the noble Lord, Lord Bonham-Carter, said, authorities do not always help themselves. If we are saying that money is essential, and of course it is, the authorities also must help themselves by making sure that their priorities for spending are on those things which really count, such as dealing with empty houses and other dwellings. That to me is a priority. But to be able to do that the authorities must look at such matters as collecting the rents that are owed. An authority cannot help people by allowing them to run into debt, because that upsets the whole of people's lives and it means that an authority is not carrying out its function correctly.

There are authorities where as much as 60 and more per cent. of rents go uncollected. The authority needs that money for various things yet it allows that to happen. My plea is that that too is part of this debate and should not be overlooked. If we turn away from it and we say that it is a political point, we are missing something fundamental and I hope that we shall not do that.

When I look at the thousands of empty houses in the London borough of Lambeth and the hundreds that are empty in Wandsworth I have to ask why that is so. They are neighbouring authorities. Why is it that one authority can achieve something and the other cannot? The answer is that one of them makes spending on empty houses a priority while the other makes other matters a priority. The other authority makes as its priority other things that no one in this House would support as being fair and reasonable, especially if we are to be concerned about what I think the right reverend Prelate referred to as public service and public interest. That is also what being in local government is supposed to be all about. It is a pity that it is not always concerned about that.

What do we have to see being done? What must we say to government? Of course they must continue with their initiatives. No one initiative solves the whole problem, but there have been many of them and in many cases they do a lot of good, although they do not solve the whole problem. The Government have paid out £3,000 million in the last eight years as direct urban grants. That has produced another £1 billion or £2 billion from the private sector and in my view it will produce more in the future. That is important and must continue, although it is not the whole of the answer. However, it is the extent to which the Government can induce others to come along and play their part that is important.

But the initiatives themselves, the task forces, the enterprise agencies, of which I am told there are more than 300—and I had the privilege of opening the second one—have produced thousands of jobs in a small way. They have not tried to replace the declining industries, but nevertheless thousands of jobs have been created. The enterprise zones have been much decried by some but not by others. They have not been decried by those who are working in areas where previously they could not find work. The enterprise zones are not the whole answer to the problem but they are a part of it.

The business in the community project, the inner city enterprises, the urban development grants and the urban regeneration grants all have a part to play and all contribute something towards solving this one problem. Everyone who has spoken so far, and I suspect those who will speak later, will agree that there is no one solution. As we say in Yorkshire and as I have said in your Lordships' House before, we have got to get them in singles. But we have got to get them and one way in which we shall do it is by a whole series of enterprises and initiatives.

I want to say a few words on housing, which, as everyone will agree, is the key to this problem. The Government must do something. They must ensure that land is made available. The land registers arc there but they are not being used as they should he. There is much more scope for government to do more to ensure that both authorities and other statutory public bodies make land available. The document from the House Builders Federation which was referred to by previous speakers mentions again and again the need for land. The Government have a marvellous derelict land grant scheme and I submit to them that a priority for that should be in the inner cities to a greater extent than it has been hitherto.

The Government have to look at land and at the money being spent on infrastructure. Land is the key. Ask any builder, public or private, and any householder. It is the key and it is what the Government must concentrate upon.

The Government must look at the way their urban development grant schemes are working. It is natural for civil servants and bureaucrats to be concerned about the spending of every penny. They have to account for the money and that is understandable. However, that is contrary to what a private developer does when he takes a risk. He wishes to take a risk and other people wish to make sure he does not take a risk. How can grants flow quickly, freely and smoothly in the face of that dilemma? I had the same problem when I was in the department and I ask my noble friend the Minister to look carefully at it. The system works slowly and it frustrates and discourages people who want to do things and who may walk away time and time again.

Local authorities have their part to play in housing. They have to make land available and they must call in the private sector to help them. The part they have to play is not the only part, but it is a critical one. They should be brought in, encouraged, worked with and enabled to do the job. They should be told the kind of housing we want. It is not a question of building housing at the top end of the scale, and no one proposes that.

If we work together with local authorities we can produce housing for rent. The Housing Association tells me, to my great pleasure, that it is putting up £30 million of Housing Association money and bringing in £70 million in private sector money for assured tenancy housing for rent. It can be done if the will and imagination are there. I hope that they are going to be there. My plea to my noble friend is for flexibility. If at the moment 30 per cent. is all that can be put towards it, let us keep an open mind. Flexibility is essential in this debate.

Concerning the docklands, I wish to say a few words about the criticism that what is involved is not housing for the people. Perhaps I may cite a few figures which astounded me. In 1981 there were 14,000 local authority houses in docklands. Since then 12,000 dwellings have been built; some 7.600 are on LDDC land and the rest are on private sector land. Of the dwellings built on LDDC land, 59 per cent. have been sold for less than £40,000. That is housing which is not for rent but for sale. I do not think that anyone would say that those figures represent expenditure beyond the pocket of a great many people. That should be borne in mind. The current programme is for a further 16,000 dwellings on LDDC land and 9,000 on private sector land. It is very encouraging when one looks at the dereliction which has existed there for decades. One may not like everything that is being built there but one must compare it with what was there before. It is dynamic and it is bringing in jobs. The jobs now are measured not in thousands but in tens of thousands.

This is a big subject. It has been debated a number of times and no doubt will be again. I am sure your Lordships are aware of the various proposals for urban development corporations. They are not the answer everywhere but they are a help in some places. The problem is vast and did not come about overnight. It will not go away overnight. But I now have the feeling that there is a wish in all sectors to work together, along with all the voluntary agencies, to make it happen. The Government have clearly stated their determination that it will happen. I have great confidence that there is a new feeling about this problem. I thank the noble Lord, Lord Dean of Beswick, for giving us the opportunity once again to debate it.

Lord Pitt of Hampstead

My Lords, when I heard the Prime Minister's positive statement that something was to be done for the inner cities, I felt very pleased and very happy. Then, in a funny sort of way, I began to think. I thought: "My God, this is probably just another gimmick, very much like Branson cleaning up London". I thought of the things which this Government have done in the past eight years which have made the inner cities worse.

I therefore wish to ask the Minister whether the proposals for tackling the problems of the inner cities means a change in policy on behalf of the Government. Unless it does, we are being fooled. Over the past eight years, the Government have made inner cities worse, first, by their attitude to the rate support grant. The Government deliberately reduced central government contributions to local government expenditure. As a consequence, the local authorities have had nearly £3 billion less in rate support grant than they would have had.

However, that is not all. The Government adopted a policy of penalties. What are they called?

Baroness Fisher of Rednal

Clawback.

Lord Pitt of Hampstead

As a consequence, the rate support grant to many of the worst areas was reduced. As I have said before, if we have a formula which, when it is put into the computer, produces the worst and most deprived areas as areas of overspending, the formula must be wrong. The Government have never accepted that. The consequence is that most of the poorest areas in this country have had the worst treatment from the Government in terms of rate support grant. I hope that the proposal of the Government to tackle the problems of the inner cities means that their policy is going to be changed.

The second matter is housing. The Government have had a myopic view of housing policy. Their policy has been to increase home ownership. There is nothing wrong with that. However, we need to provide enough houses for people in need. That has never been done. Over the past eight years we have had a steady reduction in the amount of housing being provided. It is a fact that we have had a steady reduction in the number of houses being provided. What is worse is that we have had a steady increase in homelessness. We have had a policy by which local authorities have been allowed to use their revenue expenditure to put such people in bed and breakfast accommodation. At the same time, they were being forbidden to use the capital receipts in their possession to build houses in which they could house such people.

We have also had a steady attack, as we have had tonight from the noble Lord, Lord Bellwin, on empty houses. In London, the largest number of empty houses are Government owned. The next largest number of empty houses are privately owned. The local authority owned group are the smallest. I do not defend the fact that local authority houses remain empty. I am chairman of Shelter and our literature shows that we have spent a lot of time attacking local authorities for having their properties empty. Therefore, I am not defending it, but I am saying that you can be positive rather than negative. The Government have regarded this situation as a nice piece of propaganda and therefore have never attempted to co-operate with the local authorities to reduce the number of empty houses. Instead time is spent attacking the local authorities for having empty houses. I hope that the plan, the suggestion that we are to deal with the inner cities, means that these policies are to be changed.

I am glad that my noble friend Lord Bonham-Carter raised the question of ethnic minorities. There is no way of tackling the problems of inner cities without dealing with that particular problem. Although only 4 per cent. of the population of this country are from ethnic minorities, a large percentage of the population of inner cities are people from the ethnic minorities, and there are some areas where the figure is as high as 30 per cent. Even worse, they form a much higher percentage of the unemployed than should be represented by their percentage in the population. They form a very much higher percentage of the homeless than should be represented by their population. If we are to tackle the problem of the inner cities, we have to tackle the problem of disadvantage based on race, which is basic to many of the problems.

The noble Lord, Lord Bellwin, talked about self-help. When these chaps came here from the Caribbean there were plenty of jobs and they came here because the country needed their labour. Unemployment was never a problem. However, they could not find anywhere to live and there were plenty of notices which said "No blacks allowed" or "No blacks accepted". That situation has changed. They had to buy houses together, co-operatively, and they then rented them to each other.

Of course they then found discrimination at every level. They had trouble in borrowing money because the building societies and the banks discriminated against them. Even worse, they often found that they were exploited. For example, if they bought a house with a sitting tenant they found that the sitting tenant was the owner. These are all experiences that they have had. However, the situation has changed. But in those days waiting lists were long and because people had to live a certain length of time in a borough before being put on the waiting list it was not possible for them to get local authority housing.

With a lot of self-help they adopted methods which enabled them to manage. At the moment many of them are living in very dilapidated housing as owner-occupiers. However, as to whether owner-occupation is a great policy, that needs a lot more thought. Again, I speak from knowledge. Many old people who own their own houses cannot repair them. Much of the deteriorating property that we have is as a result of old people owning houses that they cannot repair. One needs policies covering all sorts of matters and again I am not condemning the right to buy. It is a nice enough policy if it is accompanied by other policies which balance it out. We have not had the width of policies in housing that are required, and the width of policies in the relationship between local authorities and central government which would enable local authorities to play the part they should be playing in dealing with these problems.

There is a local government Act which is aiming to stop local authorities doing what I have suggested many times in your Lordships' House central government should be doing; namely, using their power as an employer or contractor to make sure that the people they employ and the people with whom they have contracts respect the Race Relations Act and in so doing respect the Commission for Racial Equality code of practice. If that is made a condition, many of the barriers preventing people of ethnic minorities getting jobs will be broken down.

As I have said before in your Lordships' House, that can be achieved through an executive order. This did much more to reduce discrimination in employment in the United States than the Act that followed years later. All they did was to insist through an executive order that in federal employment there should be equal opportunities. There is nothing to prevent this government doing the same. Many local authorities have done just that. What is the situation now? We have in the other place a Bill which would prevent the local authorities doing so. They must have contacts only on commercial terms. So once contracts are seen to be only on commercial terms they are barred. Also, the provision of local labour for many of the schemes we are talking about will be barred because the terms are not commercial.

Therefore I am hoping that when the Minister replies he will tell me that the statement that the Government are going to attack the problems of the inner cities means that they will change their policies in these matters. I am very grateful to my noble friend Lord Dean for initiating the debate. I hope that the Minister will be able to give some reassurance.

5.48 p.m.

Lord Vinson

My Lords, we should indeed be grateful to the noble Lord, Lord Dean of Beswick, for raising this timely debate.

Your Lordships may wonder why someone who is known to be chairman of a government body deeply concerned with helping to create jobs in rural areas should wish to speak in a debate on our inner cities. It is because I believe there are many important lessons to be learnt from the social cohesion that is found in villages.

In many respects villages represent social patterns that have remained unchanged over the ages. There are natural communities where people know their neighbour (even if they do not necessarily love him) and where community spirit is such that people will quite automatically come to the aid and comfort of those in distress, keep an eye on the elderly, or box the ears of the young when they are up to no good. In other words, they are a settlement pattern that works in the wider sense of the word. This is a pattern that does not throw up many of the intractable social problems found in our urban cities, or when these occur they are on an infinitely lesser scale per head of population.

I now turn to towns and the self-inflicted wounds that society has brought upon itself, not least in that dreadful period in the 'sixties when planning concepts went unquestioned, when comprehensive redevelopment destroyed our inner cities and with it destroyed the social cohesion and civic pride that went with the old urban village. Prior to that many cities had, by quite natural social evolutionary processes, moulded themselves as a series of urban villages, places where people lived and worked, places as in rural England where people know their neighbour, could call upon him and could rely upon him. That is not the case now, where so often people live anonymously and abandoned at the top of tower blocks. The road to social disintegration is indeed paved with good intentions and for the best of reasons. It was considered wrong that people should live in close proximity to their work, and in many ways at the time this reasoning was right. Houses sheltering under the gasworks or next door to the steel mill gave a ghastly existence to the inhabitants.

But zoning was carried too far. We enforced commuting so that people had to cross town to their place of work in the industrial estate. At weekends those areas became silent and uninhabited save for the presence of teenagers or others hell-bent on vandalism.

The natural employment created by the exchange of local goods and services was made much harder. By destroying the local economy we destroyed jobs. But there is hope. Technology dictated the life patterns of people because it was necessary for them to live cheek-by-jowl to the mill or the mine in which they worked. Yet technology can come to our rescue by allowing production on a scale and in a manner which again enables people to live in closer proximity to their work under conditions that are environmentally wholly acceptable.

Some argue that zoning is still right and that work and jobs should be separated. Yet here in London some of our most expensive houses are to be found in mews cheek-by-jowl to the pub on one side and the repair garage on the other. Such houses are in high demand; so, obviously, someone wishing to live there does not mind the village atmosphere, the social life and the bustle that permeates the district both on weekdays and at weekends.

The point I am trying to make is that we have to re-create the urban village along the settlement pattern of the old rural village. Of course, many other major issues in this important debate have been very ably dealt with tonight by other noble Lords. I wish to concentrate on this particular point. If we wish to get social cohesion, self-policing, good neighbourliness and a strong sense of community, we must build our towns in such a way that their fabric encourages this. We must make them user-friendly.

Modern small-scale technology is now no less environmentally detracting than were the butcher's, the baker's and the candlestick maker's activities in both the urban and rural villages. I urge all those associated with urban redevelopment to plan deliberately to build some houses with small workshops—craft homes, if you like—or buildings where people can live and work on the same spot; places in which the small plumber can keep his equipment, the artist can have his studio and the dressmaker can make her dresses while keeping an eye on the children. They would be places in which a million small-scale economic activities, subject to sensible environmental safety and fire regulations, can take place and by which means people can earn a living, employ themselves and create jobs for others.

Such places will increasingly meet the changing work patterns and demands of our time. Of course, this is not the answer alone, but I believe it to be one very important answer. It will require planning that consciously allows the development of such mixed hereditaments—workshop homes that people can own as well as rent, because where nobody really owns nobody really cares.

It may mean, in order to get the concept rolling, giving the same rate reduction treatment or other priorities which are offered in enterprise zones. I see nothing wrong with that. Somehow, we must begin to plant the social roots of urban village life and recreate small-scale society where jobs become interdependent, are locally based and where people take in and out their own laundry, so to speak. In this way our towns will return to being whole communities. People will naturally trade with each other and so will help to create the fabric that provides social cohesion, self-help, self-reliance and civic pride.

There is nothing particularly new in my suggestion—is like rediscovering the wheel—but I believe that the recreation of the urban village is the key to recreating prosperity in our inner cities. It is the natural, social and economic pattern to which human beings aspire. Jobs are created in rural areas in this way; they always have been. We must encourage the same sort of development in our urban areas. Therefore, I congratulate the Government on giving such high priority to urban redevelopment in their new programme and I urge them to promote this concept.

5.55 p.m.

Lord Seebohm

My Lords, I make no apology for speaking once more about housing. I do not propose to go into any details of facts and figures because that has been done ad nauseam in the past. In this House we had a long debate on the Duke of Edinburgh's commission. We have had publications like Faith in the City and we have had the latest report from the House Builders Federation. Therefore, I am not going to weary your Lordships with any of those figures.

In my opinion, and I think in the opinion of everybody else, the situation is intolerable. It is still deteriorating and everybody is asking: why have successive governments not taken the necessary steps, not necessarily to greatly improve conditions, but to stop them deteriorating further? I see very little sign of that at the present time.

I ask myself what are the reasons? Is it because they just do not care? I believe that to be absolutely untrue. They care a lot, and I believe that this Government care a lot. I have come to the conclusion that it must be for reasons of finance. I have looked at this a little more carefully and I have done a few back-of-envelope calculations. My first conclusion concerns what is called the PSBR which seems to crop up quite irrelevantly in such a situation. By the time the current privatisation plans are completed the Government will have taken about £18 billion of private sector savings. Apparently that is not looked upon as inflationary. As far as we know, the money has not been used necessarily for capital purposes; but still it is not looked upon as inflationary.

I believe that the public of this country feel so strongly about housing that they would support a national housing loan of many billions, raised on commercial terms. It would not be inflationary. It would have no effect on the PSBR. But it might well give an opportunity to start making a major attack on the housing situation. I give one small example. I am told that there are many youngsters who have been given money to pay £65 a week for bed and breakfast. That is £3,380 a year. If considered as 10 per cent. of capital, that means £33,800 is being used to supply bed and breakfast for one person.

I am also told that if you want to build a hostel, shall we say, to a modest university standard, with perhaps two people to a bedroom, this can be done for between £7,000 and £10,000 per unit per bedroom. On my calculations, therefore, for every £30,000 spent, it would be possible to house not one person but somewhere between six and eight. That makes a lot of sense to me and I have the feeling that it is one of the most important things that we can now do. To build hostels for the young homeless would result, I believe, in an economic saving to the country.

The next point I make has been made previously, but I think it is worth stressing. Housing for rent is becoming more and more necessary not simply for the poor but also for the mobility of labour and for various other perfectly obvious reasons. In this connection, I mention a proposition which has come forward recently—that people should be entitled to let spare rooms in their houses without any restriction. That would bring in possibly £60 a week for a couple of rooms and it should be tax free. It should have no effect whatever on the receipts of the Exchequer. It would not cost anybody anything; it would bring unused assets into use; and it could make a real impact on the mobility of labour.

I ask the Government three questions. First, does the Minister accept that the housing situation is desperate and getting worse? Secondly, does he agree that finance can be raised without causing inflation or having any effect on the PSBR? Finally, does he agree that there is plenty of slack in the construction industry and that a massive attack on the crumbling infrastructure could make a significant impact on reducing unemployment?

When I wound up the debate on the Duke of Edinburgh's commission, I said that from the beginning of all time, happiness has depended on satisfactory board and lodging. By "board", we mean food and, my goodness, we have enough of that. By "lodging", we mean a watertight and warm home for everyone and, my goodness, we do not have that.

6 p.m.

Lord Sefton of Garston

My Lords, one of the problems of being half-way down the list in a debate of this nature is that one looks at one's original notes and wants to throw them away, so it is fortunate when a noble Lord refers to an item already in one's notes because that gives one an "in".

It is very wrong to keep referring to people outside the Chamber. May I try to remove some of the myths and delusions of today that appear to centre on the problem of inner city areas? First, as has been said, the problem is not new. It goes back years, and it changes in its nature. In Liverpool, it changed from handling the immigration of the Irish as a result of the potato famine to dealing with a situation that was so insanitary that Liverpool became the first city to appoint a medical officer of health because of the danger that threatened the wealthier members of the community.

Now there is another problem. It arises because of some of the things that occurred in other periods. Some experts on inner city problems seem to have no knowledge at all of it. I listened to the president of the RIBA the other night, and I am glad that the noble Lord, Lord Vinson, appears to have been listening also. Indeed, the speech of the noble Lord may well have been written by the president of the RIBA.

I take one point from the speech—that the 1960s failed. Failed to do what? No answer. The 1960s was a new problem created out of a very old problem. If there was one place in which this national disease was centred, it was Liverpool—and I like to think that I know a little about Liverpool. If the noble Lord, Lord Vinson, looks up the history of Liverpool, he will see that in the 1960s we were taking out sand from basement dwellings put there by the medical officer of health to prevent the poor Irish from going back to insanitary conditions. That was the problem we were trying to solve in the 1960s.

I do not see why I should boast about what Liverpool did between 1945 and 1953 because in the main it was run by the Conservative Party.

The 1960s failed? Tell that to the people in Bidder Street. Bidder Street was a very famous street in the 1950s. Bessie Braddock in another place told of the reality then of bug-ridden, cockroach-infested dwellings that were built by private enterprise to ensure that dockers were on top of the job, to be able to tumble into work and tumble out of work into the pubs owned by the same people. That is what the 1960s were designed for.

The president of the RIBA and those people who carry out nice little schemes of 120 houses which they then tart them up with little coloured porches that make no contribution at all seem not to realise what the housing problem of the country was. It was of tremendous magnitude. There is a block of flats in Liverpool's dockland called Logan Towers, named after one of the serving Members of Parliament in that area; he was Father of another place. The Logan family—I opposed it—were pleased that that block of flats was built because the alternative to getting rid of the slums and not erecting that kind of building was to send people out into the green fields of Netherfield or Kirkby, and they did not want to do that.

We were pressured not by architects but by central government because, under the stupid arrangement about the financing of local government, they completely ignored the fact that, if one exported the population to give them decent housing in green fields, rate support was lost for the government of the day. That is another problem that the RIBA does not face up to. Go and tell it to the people of Bidder Street. Above all, go and tell all those people who are living in excellent conditions in some of the finest housing built under Nye Bevan on the outskirts of Liverpool and in the suburbs of Liverpool that the houses built in the 1960s were a failure. You would be torn to pieces if you went there and tried to do it.

Very happy communities were built in Liverpool. I resent the suggestion of these johnny-come-latelies that they know all there is to know about the problems. The problems of people in inner areas, as the noble Lord, Lord Bellwin, said, will not be solved until they are in a position to help themselves. Do not tell somebody who owes rent in a local authority house, "Go and help yourself". If a person on supplementary benefit has a choice between buying the kid a new pair of shoes and paying the rent, the shoes are going to come first. Do not tell these people to go and help themselves. That is what they are doing—helping themselves, helping the kids to shoes as an alternative to paying the rent. One may well blame the local authority for not being strict enough in enforcing collection of the rent, but I do not, and I make no apologies for it. If it were left to me to say to somebody, "The kid goes without shoes and you pay the rent", I am sorry, but I should not make that choice.

Local government in those days in trying to tackle housing was dealing with an outdated system. Let me give an example. The inner area problem arises because of the congestion created within the inner area to keep the economy going. It was vital to the interests of the shipping industry in Liverpool that people should be housed right by the docks. It was also vital that, instead of water being given to people in houses, it should be provided for ships. That is what made Liverpool famous—a copious supply of clean, pure water so that ships could sail long distances throughout the world. The water was taken to the docks, not to people's houses; so that left another problem.

Because of this congestion and its effect upon the rich shipowners just outside the city centre, the rich shipowners left Liverpool. What happened? All the money on which they lived was generated in the city of Liverpool. Where did they spend it? Not in Liverpool;—oh, no. They took it to the Wirral, to Southport, into the rural areas of Lancashire and spent it there, denying the city of Liverpool the resources that its people had themselves created.

That is the fundamental problem of the inner city areas. While it affects Liverpool, it is not only Liverpool, because Liverpool is the nation writ large. Let me ask the Secretary of State a question. I congratulate him on his new responsibilities and I sympathise with him in the task he has. I have already asked him some questions to which I have not had answers. I made a statement that more money is put into the South-East of England than is spent on the whole of regional aid for the rest of the country. I may be wrong. It would not be the first time I have been wrong. I should like to see the Secretary of State get the figures out and then add on the amount of money that is spent on subsidies to people who are employed in the South-East. I refer to money spent by the private trade—banks are paying an extra £3,000 over and above anywhere in the North—and the extra money the Government have to pay to keep staff in London.

Several steps could be taken to cure the problems in Merseyside. We could create 402,000 square feet of office space in the Merseyside area and people it with employees. Overnight that would solve the Merseyside problem. In 12 months 402,000 square feet of office space was occupied by this Government in an area from St. Albans to Newbury and down to Horsham. They took it last year. The year before it was nil. What are the Government doing? Are they helping Merseyside? Are they helping the North? I ask the Secretary of State another question. Perhaps he will write to me with the answer. Is it vitally necessary that the people employed in that 402,000 square feet of office space should carry on their profession in those areas? Could they not be moved, as was once proposed by central government, to another part of the country and so help distribute the plentiful resources of this country? That kind of argument can be repeated over and over again.

I wonder what the nation would say if I said there were 10,000 vacancies for railway workers in the North-West. There are 10,000 vacancies for railway workers in the South-East. Why? It is because the congestion in the South-East is now similar to the problems of congestion that were caused in places like Liverpool, Manchester and Leeds. If we want to do something about it, we can. I do not know whether noble Lords accept the simple premise—I accept it utterly and completely—that the standard and quality of life that a person enjoys depends in the main on his economic circumstancs. If it does, why do we not redistribute some of the wealth that is hanging around in the South-East of England and then leave it to the people of Merseyside, Manchester, Birmingham and the rest to apply those resources to cure the problems? They will cure them.

We hear from the Duke of Edinburgh and the Prince of Wales. They are very concerned and are starting new ideas—trusts and so on. We do not want them. We do not need them. Liverpool has a history as long as your arm of that kind of thing. Tomorrow morning I shall be meeting the general secretary of the Young Persons' Housing Association in Liverpool. Over the past quarter of a century it has taken Victorian blocks in Liverpool, which were deserted by the wealthy people, the cultured people, who went out to Southport when the bombs started dropping, and has converted them into good housing. We do not need the Prince of Wales or the Duke of Edinburgh. We have a long history of doing such things. Such improvements have now been going on for 40 or 50 years. Merseyside Improved Housing has taken houses that were in multi-occupation and has cleaned them up and provided flats. Maritime Housing, the secretary of which was a responsible Member of the House of Commons, has been doing the same thing. We have the know-how. If you want to become modern then go to the Eldonian Association, which has had enough publicity lately—Liverpool born, Liverpool bred and producing a very good job indeed.

I make no apology for coming down to the basic requirements for solving some of the problems of the inner cities. I know there is a problem in London, but match the problem that obtains in regard to unemployment in London against the 10,000 vacancies and the vacancies elsewhere in the South-East. The problem in the South-East is the proper distribution of opportunities. That does not come from London Docklands. Go and tell some of the people on supplementary benefit that they have to pay only £45,000 for a house and they can have one in docklands. That shows the gap that exists between Parliament and the suffering of ordinary people. My Lords, £45,000 is a fortune beyond the grasp of hundreds of thousands of working class people, yet we talk about it lightly here: "It is only £45,000".

Let the Government set up a Select Committee—perhaps the Secretary of State will examine that proposition—to see how they can get rid of some of the staff in Victoria Street and put the MPs there instead of talking about putting their offices in Westminster Hall. Let them see how many people out of the Ministry of Employment they could move nearer the customers in the North. They do not all need to be here. They do not all come running over to see Ministers. The heads do so keep them here. There are hundreds of other jobs. Fundamentally the Government are saying to the private sector, "Please look at the possibility of diverting your resources and investing in the North". That is what they are saying, so let them put their money where their mouth is. I say to the Government, "Look at the problem". I do not say, "Do it"; I merely say. "Look at the problem". Somebody is looking at his watch.

Lord Graham of Edmonton

My Lords, that is the problem.

Lord Sefton of Garston

My Lords, perhaps I may say this to the right reverend Prelate the Bishop of Durham. The Church of England is the established church and is part of our community. It knows what the problems are because it has a good many bishops up in the North who know them. Perhaps the right reverend Prelate can answer the question. When it was proposed that they move their offices, why on earth did they not move them out nearer the people? If they did that perhaps the people would then begin to realise that somebody was concerned about the North and about the people.

6.18 p.m.

Lord Thomas of Swynnerton

My Lords, the noble Lord, Lord Sefton of Garston, took us back in time to Liverpool in the 1960s in order to correct any sense of parochiality. I hope I shall be forgiven if I remind the House that in the 1820s Lord Liverpool, whose electoral achievements we have been reminded of recently in a significant manner, remarked to the then French Ambassador, Monsieur Chateaubriand: What are we to do with these enormous towns? One false step and we are lost". In the 19th century there were a number of developments; gas lighting, Victorian morality and an innovation, which at the time was resented as something imported from France—namely, the police. I should like to try in this perceived new crisis to echo the remarks of the noble Lord, Lord Bonham-Carter, that this problem is not unique to this country at this time. We ought to be willing to consider some historical and geographical lessons. We should notice how this country was the first country in the world in the middle of the 19th century to have a majority of its population living in urban circumstances. This has happened in all other countries since that time but we were the first. Naturally, we have some problems which derive from that not desired pre-eminence. That is particularly so since the collective approach to housing, although philanthropically intended when it was begun, often resulted in geographical immobility in our cities which, had that collective approach existed before the rise of those cities, would probably have prevented those cities from rising in the first place.

Some of the effects of other housing policies were put particularly brilliantly by my noble friend Lord Vinson, whose speech I shall read with great attention, as will other noble Lords. In particular we ought to bear in mind what he said about the effects of commuting. The fact is that the ease of commuting and weekending—which are consequences of prosperity—have often had the effect of making cities leaderless half the time. We should also be willing to learn from our European partners, with whom we are now economically so closely associated, even our Latin partners often in places poorer than either Liverpool or Glasgow. Perhaps particularly we can learn from our Latin partners—pace the noble Lord, Lord Bonham-Carter—whose citizens and leaders have gone to immense efforts to try to try to preserve and expand local activities of dazzling variety, which may not necessarily have brought prosperity but which at least have maintained or extended civic morale and pride.

I regret the absence of the right reverend Prelate, but I should like to ask Church leaders in particular, whose dimensions and interests have evolved so considerably in the last generation, whether in the next generation they could not devote some of their ample energies and intelligences to see whether—I must put this carefully—their post-reformation distrust of such manifestations as carnivals with a religious basis could not in modern circumstances be re-examined. Sometimes in Latin cities good strict Protestants mutter the word "paganism" as they see great processions pass in the Mediterranean countries in Easter week. Paganism? It is life itself, usually inspired by private endeavour, private dedication and with a minimum of public money.

Your Lordships may think that I am teasing the Secretary of State with my Latin ways. I am not. As a resident of Notting Hill—indeed I am proud to say that my title designation derives from Notting Hill—I know the benefit of the Notting Hill carnival in summer. I walked through Toxteth Park soon after the last famous riots there. Of course, as your Lordships will be aware, the housing in that suburb of Liverpool is decayed. The people were undoubtedly shabby; nevertheless the housing was not irredeemable and the people were not starving. That was not the problem. When I was there a prosperous West Indian said to me, "It is not money these people want; they can get it. It is not even work, because most of them get some of it. They are bored. What they want is a bit of life". That is perfectly true of ordinary white Anglo-Saxon Protestants as much as it is true of West Indians.

We as a nation are often looked on as experts in preserving the continuity of ceremonial and celebration. The survival of your Lordships' House with its marvellous rituals reminds us of that. The survival of the fashionability of Oxford and Cambridge attest to that. The success of the Jubilee celebrations reminded us of that, but the surviving sense of ceremony, so important in people's lives and so important in preserving civic pride, affects only a tiny minority and too rarely.

6.25 p.m.

Baroness Fisher of Rednal

My Lords, over the weekend I visited many of the inner city projects being carried out in the Handsworth area. I was thrilled with many of the things that I saw and disappointed with some that were not moving as fast. Yesterday reading the Guardian I found that there might be a form of new money coming from the Government from the possible use of new town commission sales which might boost the income which the Government could spend on the inner cities. I felt that perhaps we were on the right road. But one reads this morning on the front page of the Guardian that at the Chancellor is considering plans to reform taxation which would cut the tax dues of many rich people living on unearned income.

It seems a strange paradox that on the one hand the Government are saying that there is not enough money—therefore those who are living in the inner cities will still continue to suffer—and on the other hand are giving it to the very wealthy. That is a dichotomy if ever there was one.

I have been interested in what the noble Lord, Lord Bellwin, said. I am always interested in Lord Bellwin and his comments because he was a local government man. When he sat on the Government Front Bench it was obvious in many debates that he sympathised with the noble Lords, Lord Sefton and Lord Stallard, and others including myself who knew all about local government. He was sympathetic although he had government policy to put through. As the noble Lord quite rightly said, each of the urban areas presents different problems and different strategies are needed. We have heard from the noble Lord, Lord Sefton, that there are large tracts of land in Liverpool because docks are not used now. We see the same in London where huge tracts of land could be used for reviving not only the economic but the housing situation.

Then we come to other areas. It is a difficult term to use but I am thinking particularly of the Black Country. For those people who do not know the Black Country, it is the area surrounding Birmingham, which includes Wolverhampton, Dudley, Walsall and Sandwell. The nomenclature "black" does not come from the inhabitants but originally from the smoke and filth that came from the steelworks and furnaces in that area. Perhaps the only good thing about the steel furnaces and other works closing down is that the air is now clearer.

In the Black County area there are very serious problems of land derelection. Where steelworks are being dismantled and mine shafts are being removed the land is covered with furnace slag and toxic substances that have penetrated the soils and is thus delaying the progress of building on those sites.

I ask the noble Lord, Lord Young, whether one ought not to consider very seriously a greater concentration of derelict land grant in those areas. There are certain problems to be overcome. In Birmingham the largest tract of open land we have is where the Saltley gasworks was. The whole area has been worked over and over for the last two years in an endeavour to get the soil into a reasonable state before it can be built on. When I mentioned the Saltley gasworks that seemed to cause a smile to cross the face of the noble Lord, Lord Young, and he passed his comment on to his noble friend next to him. People lived and still live cheek by jowl with the gasworks, because some people always have to live the wrong side of the tracks. Perhaps it will not be those who will profit when the Chancellor benefits those on unearned incomes. Therefore in Birmingham there is not a problem like the one we find in Liverpool or in London. The inner city problem in Birmingham is that of money to maintain the homes we already have rather than building more.

There are no factories in the Handsworth area; there never were factories in that area. There is a huge Victorian park, the largest in the city. On the fringe of Handsworth, where the area borders the city centre, there was a large factory that made jewellery for Samuel, but it is now closed down. That is not therefore the problem in Birmingham.

I must remind the Minister that Birmingham's core area now consititutes the largest and most severe concentration of deprivation in the city. Unemployment in the city has to be put in graphic terms. For the decline in employment in Birmingham has been more marked than anywhere else in the country. Since 1971 the city has experienced employment losses of 190,000, nearly twice that of Scotland and Wales put together. The majority of those jobs were in manufacturing. Most of the people lived near the city centre where all the large factories were located.

It is important to recognise that Birmingham provides perhaps the widest range of policies that can be brought to bear on inner-city problems. The noble Lord, Lord Young, will know that the Minister of Trade and Industry, on a visit to Birmingham yesterday, complimented the city again on the refurbishment of houses there. It is important for the noble Lord, Lord Pitt, and the noble Lord, Lord Bonham-Carter—who is not here—to recognise that Mr. Clarke was pleased that the city, through the building contractor, has taken on a considerable number of coloured persons in that area not as labourers but for training so that they become competent on the job.

However, as the noble Lord, Lord Bonham-Carter, has said, that might not be possible in the future. It appears that the Environment Secretary has different opinions to those of the trade and industry Minister. It is important to recognise that Tarmac, a large building contractor, has acted with the compliance of the local authority.

Then there is the housing crisis. I tried to do my homework before preparing these notes. In the Library there is a reference sheet called The Urban Programme. Since May 1968 somebody, somewhere, in various departments to do with inner cities has been talking a lot; but I am not sure that the action has really worked. From local government grants in 1969 to community development projects, urban deprivation units, inner-city studies and comprehensive community programmes, so it goes on for page after page. There are the urban development corporations. Then, following the riots in Toxteth, we decide to re-hash our programmes, and Ed Berman, a director of Inter Action, is appointed by the Secretary of State as a special adviser to the inner cities.

It goes on and on. But all the time what we are doing is just changing the name of the money we are putting in. We are not doing anything else. As the name is changed the amount of money becomes smaller. The noble Lord shakes his head as he did when the noble Lord, Lord Pitt, spoke. I wonder sometimes whether the Government have figures. The local authorities have figures. I can give figures for Birmingham which prove conclusively—I am not going to use them—that although a great deal of money was received under the urban aid programme, Birmingham is not as well off as it was five years ago.

The noble Lord will find figures to disprove what I am going to say. He will not give the whole figures. That is how figures are bandied around. Local authorities are often accused of intolerable delays in the planning mechanism. I ask the Minister to examine the length of time it takes for development grants to be processed in Whitehall. I ask whether the process has been slower since regional offices ceased processing the grants? Is it because development grants are not now being processed in Birmingham and have to come down to Whitehall that the whole process has become slower?

I am informed that in January of this year the local authorities put in their claims under the urban aid programme and are still awaiting replies. These include several enveloping schemes. If they are not started before the end of the year the money is lost. I would ask the Minister to examine the situation, bearing in mind that local authorities are normally the ones that are criticised.

Since 1979 the underlying problems of the inner cities have gradually grown worse. Those of us who live in these areas know it. I agree entirely with the noble Lord, Lord Pitt, that public sector funding through local authority main programmes has been reduced, and of course unemployment has taken its place. Therefore, people who are living in the inner cities need a great deal of encouragement.

When I was a Member of the other place, somebody said that people have to learn to stand on their own two feet. People are a bit more cheeky in the other place, and somebody shouted out, "But what if you haven't got any feet?" Some people living in the inner cities are becoming morally despondent. And of course ill-health is now creeping into those areas.

Ministers who want to see for themselves should consider coming overnight and having working breakfasts and working lunches. Before going out on their visits, they would have the opportunity of speaking to people in the area—the CBI, the chamber of commerce, trade unions and local councillors. Ministers would hear what people have to say. They would be told of the problems and find out the things that were going wrong; and then they could go round and get the publicity in seeing what was being done.

I should like to make an urgent plea to Ministers to do without their limousines and police escorts. It does not endear them at all to people in the inner cities. There has been mention of the report of the building trade. It is important to note the remarks of the president of that organisation when he says that he can see the need for a housing ministry. He states: Therefore I firmly believe that housing, to be given the consideration and priority it merits, must be taken away from the… budget-slashing DoE and established in a separate Housing Ministry, with its own unequivocal priorities". On that note, I thank noble Lords for being patient with me.

6.41 p.m.

Lord Stallard

My Lords, I should like to thank my noble friend Lord Dean for posing the Question to the Minister. The Question asks Her Majesty's Government: how they propose to deal with the deteriorating situation in inner urban areas". It is encumbent on all noble Lords who participate in the debate to point to some of the areas of deprivation if possible. Previous speakers in the debate have done just that.

Most speakers have referred to the fact that the problems are not new. The problems of our inner cities have been universally acknowledged for many years. Millions of words have been written and spoken in reports, surveys and debates in this House and elsewhere, and many more words will be spoken in the months to come as legislation unfolds. In his eloquent speech my noble friend Lord Pitt pointed to many incidents of deprivation and deterioration in our inner cities. I too welcomed the Prime Minister's initial reaction to winning the election when it was stated in the Independent on 13th June, (and I say this to prove that I am trying to be impartial): Mrs. Thatcher had only one substantial political point to make to her party workers. She told them, for the first time explicitly, what the education, housing and urban improvement policies which form the most radical planks of her third term manifesto are all about". She said: from Monday, we have got a big job to do in those inner cities…". Like the noble Lord, I welcome those remarks. I was pleased to hear that and I hope that she meant it. However, I should have been happier if she had not gone on to say: because we want them, too, next time". I thought that that set the wrong note for a debate on the problems of the inner cities which will range nationwide for a long time to come. In my view that is not the right foot on which to set off.

It is true that many initiatives have been taken and tried. There have been many successes over the years, particularly since the 1977 paper on the inner cities and the initiatives put forward by the then Secretary of State, the right honourable Peter Shore. Many successes flowed from that programme and we should be churlish to say that there have been no successes in the programmes that have been initiated by this Government, as far as they have gone. It is strange that in tabling this Question it can be said that conditions have deteriorated since 1979. I hope to give a few examples.

An article I read recently in a Town and Country Planning Association publication summed up the matter by stating that the conditions of our inner city areas: are characterised by the communities suffering from acute collective and personal deprivation across the full range of social, economic and environmental necessities". That is not a bad summation of what happens in inner areas such as the one in which I live. The article went on to ask: What kind of priority for inner city areas is it that creates a situation whereby the funds made available under the Urban Programme have been massively exceeded by the funds lost through reductions in Rate Support Grants…?". I am not reading from a Labour Party publication. The article states that both the rate support grants and the housing subsidy have been reduced. For example, in the case of inner London a recent report prepared for a GLC conference on inner city policy showed that during the period from 1979/1980 to 1983/1984 inner London gained £261 million in urban programme funding while losing £865 million in rate support grants. Speakers, such as the noble Lord, Lord Bellwin, quote only the first part of those figures but we must have the whole picture. Of course they have received money from the programme but they have lost massively in excess of that amount because of rate support grants. We must look at all the figures if we are to understand the situation.

This applies not only to London because Manchester City Council gained an extra £9 million in real terms from the Urban Programme between 1980/1981 and 1984/1985 while losing some £100 million in rate support grant settlements within the same period. If we wish to understand the deterioration those statistics are important. They are massive sums of money to take away from local authorities particularly when, as has been said before, the reductions have affected most of the areas with the greatest level of need and the greatest deterioration in circumstances.

In addition the co-ordinating and overview role of local authorities, which we have all known and participated in, has and is being shifted to non-elected bodies such as the urban development corporations. The noble Lord, Lord Bellwin, mentioned such a corporation but this is raising further problems and we have not yet heard the end of them. As more and more corporations are set up other problems will develop and we could have a chaotic and dangerous situation if the protests from the first experiments are not heeded. I know that most noble Lords are well aware of the problems that have been raised by the LDDC as well as other points which have been raised.

One of the advantages of being placed lower down on the list of speakers is that almost everything has been said. However, by now it has been forgotten and perhaps I can say it again—or some of it! I should like to concentrate my final remarks on the question of housing and the homeless. I have spent many years in that field and was very active as chairman of the all-party child group. In that area there have been some of the most fierce deteriorations in the inner cities. With the financial cuts have come cuts in the public housing sector. Public housing is probably the only source accessible to the kind of people we are discussing in the inner cities. The public housing programme was cut by 40 per cent. The housing association movement is working at half the level at which it was working in 1979. The figure is down from 40,000 dwellings at that date to about 18,000 now. That is deterioration and that is what we are speaking of in this Question.

Further deterioration and disrepair of existing stock has been equally dramatic and I should like to relate some of the effects of the programmes on the homeless. We are talking of people to whom the right to buy is a meaningless slogan, as has been pointed out by the noble Lord, Lord Sefton. We are not talking of people who could even contemplate buying. In my area they could not even contemplate renting at £85 to £150 per week. If noble Lords do not believe me, they should buy the Hampstead and Highgate Express where advertisements appealing to the homeless are laid out by the dozen at that rent. To those people the right to buy and other such slogans are empty words.

For the first time in the post-war period the number of officially classified homeless households has topped 100,000.

There are record numbers of homeless families in bed and breakfast accommodation. The cost in financial terms, to say nothing of the social cost, has rocketed. I do not want to weary the House with too many statistics but I should like to give one or two statistics in regard to bed and breakfast accommodation. In my own area, which I know fairly well—the London borough of Camden—in 1981 there were 69 families in bed and breakfast accommodation. In March 1987 that number had gone up to 1,258—a fairly massive increase. In 1981 they were spending £211,865 on bed and breakfast accommodation and in 1986–87 that figure had gone up to £12 million.

I think it was the noble Lord, Lord Seebohm, who gave some suggestions as to how that ludicrous situation could be prevented. In the London borough of Hackney conditions were similar. In June 1981 there were 92 in bed and breakfast accommodation and in 1987 that number had gone up to 473. In 1981 the cost was £482,000 and in 1986–87 it was £6,157,000. In Tower Hamlets the number in bed and breakfast accommodation in 1981 was 46 and in 1987 it was 930. The cost has risen from £414,000 in 1981 to —17,292,000 in 1986–87.

In anybody's figures those are massive increases and they represent a massive deterioration in the circumstances of many people. Over 8,000 families are living in appalling conditions and they live there for months or years. Nearly 10 times as many households as in 1981 are involved and it is costing 15 times as much to keep them in those hotels now. That is excluding money spent by DHSS. If that was added, the sum would be colossal. That is an example of the deterioration since 1979. I have chosen the years 1981 to 1987.

There are still thousands of others, including the single homeless, who do not qualify for housing and they are not on any authority's housing list. Many of them are excluded from priority need under Part III of the Housing Act 1985, and that was a deterioration too. They have no roof at all. Many people involved in this field know that "cardboard city", as we call it, is extending, and the situation, even for those people who already have nothing, is getting worse, if that is possible. If I could take some of your Lordships on trips that I go on you might begin to understand some of the deprivation and deterioration that exists. At one point last year I invited the noble Lord to come with me on a visit to Hackney. He declined, and he has not been since. I think they invited him too but he would not go. It is an important area if he is talking about the inner cities and he ought to understand it. I imagine the invitation is still open.

All these problems continue to deteriorate. In inner London four-fifths of the properties available for the homeless, according to another survey, lacked satisfactory means of escape from fire. We have made numerous suggestions for improvement over the past few years but have met with a blank reply. These are potential death traps. The cost of upgrading and putting right disrepair in the London area alone was estimated to be between £1,350 million and £1,691 million. So the programme gets bigger and bigger and the deterioration is there for all to see. I say it is mainly the Government's responsibility because, first, we have their ideology, their dogma. The Government have abandoned any belief, if they ever had it, in the criterion of need for housing. They have abandoned that altogether. In fact, they do all they can to dismantle local housing authorities and to shackle housing associations, whose whole approach to housing has been based on meeting housing need.

Secondly, as has been mentioned, it is now just over two years ago since the Government brought in that disgusting and shocking piece of legislation on board and lodging regulations, forcing young homeless people to become, as the Government were warned would happen by their own Social Security Advisory Committee, virtually an army of young vagrants wandering all over the country.

I should like to end by giving two further examples of current attitudes towards the homeless, because this situation of deterioration and deprivation in the inner cities is also having a backlash effect on the homeless. People are adopting harder attitudes to them. It seems to be an intractable problem. They do not want to face it. Attitudes are hardening against these unfortunate people. That is something that I deprecate. One example has been much publicised and we all know it. In Tower Hamlets the council is seeking to declare a large number of homeless families intentionally homeless on the grounds that one partner has connections in Bangladesh. I hope some solution will soon be found to that problem.

The other example concerns Westminster. The council recently announced the policy of transporting its homeless families outside the borough's boundaries. Again, I can do no better than quote very briefly from the press release issued by the Bayswater Hotel Homelessness Project. It says: In the same week that Westminster City Council started transporting its homeless families outside the borough boundaries, it slashed the number of council flats which will be available to let to people in priority housing need. In a new 'designated sale' policy, Westminster councillors earmarked 9,300 of its flats. As soon as a flat becomes vacant it will be kept empty until it can be sold. The Council intends to sell off at least 500 flats a year, in addition to sales to sitting tenants under the 'Right to Buy' scheme. The Council's report spelt out that this will lead to more people kept in temporary accommodation at an extra cost of £1.7 million per year; substantially reduced ability to meet the needs of homeless people; most priority housing categories closed; and drastic reduction of housing for top medical priority cases. The Council took the decision contrary to the recommendations of a private consultants' report which they had commissioned which stressed the increased need for social housing in the city. So I hope that somebody is listening. I hope that the last few words of the Prime Minister's remarks to her party workers at the end of the election were just made in the heat of the moment and that she did not really mean that was going to be the Government's aproach to this problem because if she did mean it, then God help the people I have tried to describe to your Lordships tonight.

6.58 p.m.

Lord Williams of Elvel

My Lords, we are all grateful to my noble friend, Lord Dean of Beswick for raising this important Question, particularly at this stage. It is of course the topic of the moment, as a number of speakers have pointed out. We have had a wide-ranging discussion with many extremely thoughtful contributions from many noble Lords. I am sure that the noble Lord the Secretary of State will have a lot to chew on when he goes away and reads Hansard carefully, as I am sure he will.

I do not intend to follow certain other speakers in talking about the problem of housing. That is not because I belittle the problem—it is certainly one of the central problems in the inner urban areas—but it is because there have been a number of distinguished contributions this evening from the right reverend Prelate, the Bishop of Durham, from the noble Lord, Lord Seebohm, and from my noble friends, Lords Stallard and Sefton and Lady Fisher. So I do not wish to burden the Secretary of State with an analysis of housing. However, I look forward to hearing the response he will make to the questions put to him by the noble Lord, Lord Seebohm, on the connection between housing finance and the public sector borrowing requirement. The Secretary of State's response is something from which I think we could all learn. Nor indeed do I intend to follow the noble Lord, Lord Thomas of Swynnerton, down the road of carnivals and religious processions. I am sure that there is a contribution to be made by such events but I do not believe that they are essential to the problem. However, to a certain extent I do follow him when I come to a point made by the noble Lord, Lord Vinson, abut the necessity to build communities with the same kind of village solidarity as one is used to in the rural areas.

The Secretary of State has undertaken a job, and I shall be asking him exactly what job it is. Not only have the inner cities been a subject of considerable concern from the days of Lord Liverpool onwards but they have been the subject of considerable Government action. After all, in 1968 my noble friend Lord Wilson of Rievaulx announced an urban aid programme which was followed in 1969 by a community development project, itself followed by the setting up of an urban deprivation unit by the noble Lord, Lord Carr of Hadley, when he was Home Secretary. In 1974 the then Labour Home Secretary, Mr. Roy Jenkins, launched a comprehensive community programme and my right honourable friend Mr. Peter Shore, as my noble friend Lord Stallard said, produced what I think was the last major statement of public policy in the 1977 White Paper entitled Policy for the Inner Cities. Since then we have had a series of initiatives under different names.

As my noble friend Lady Fisher said, we have had a special adviser to the Secretary of State to advise on ways to encourage entrepreneurial activity in the inner cities. We have had city action teams, employment task forces—which I believe have now become inner city task forces—and other initiatives. There is no shortage of names or expressions to describe the various arrangements that governments of both parties have made.

The point that has been made, which I must make again, is that we welcome any initiative in the inner cities or the urban areas that is not just another gimmick or something wrapped up in a different piece of paper. We must ask the Secretary of State exactly what is new about the Government's proposals. Indeed, we must ask him to tell us what the Government are proposing because at the moment we have simply a declaration of intention without a very clear idea of exactly what policies will be put in place.

There are three points that I should like to make about those policies when they arrive and some further points to be made on behalf of the Opposition. There are also some questions that I should like to ask the Secretary of State to answer. The first point is that we must accept the very important observation made by the noble Lord, Lord Bellwin, who said that no problem of one inner city is the same as another; there is enormous variation between urban areas up and down the country. indeed, my noble friend Lord Dean of Beswick rightly went somewhat further when he said that there is no clear definition of an inner city and that the problems of inner cities areas tend to spill over into the suburbs and vice versa.

I must also make the point—and this subject was broached by the noble Lord, Lord Bonham-Carter— that the role of local authorities and communities in any urban area action scheme is absolutely essential. I very much appreciated the speech of the noble Lord, Lord Bellwin, who rightly said that there was a whole mass of schemes but that the central point about them was that they involved local authorities and local communities in particular. The noble Lord, Lord Bonham-Carter, referred to the document entitled Managing Workspaces recently published by the Department of the Environment. He pointed out that most of the projects cited in that document were the product of the urban programme operated through the local authorities.

I do not want to detail them all and I give only one or two examples: Hackney Enterprise Workshop is financed through the urban programme via the Hackney Council; Nottingham Enterprise Workshop is financed through the urban programme by way of the Nottingham City Council; Aire Street Workshop, Leeds, is financed through the urban programme and Leeds City Council; Chelmsford Borough Council has financed the Globe House Workspace in Chelmsford. I shall not go through the whole list. As the noble Lord, Lord Bellwin, said, the important theme that runs right through this study is that the relationship between the various governmental institutions—and I mean central and local government—and the community and the desire of people to help themselves are fundamental to any programme. In so far as the Government adopt that strategy, we shall certainly support it.

I come to my second point. It is very easy for Members of this House and people living in the prosperous South-East and rural areas of the country to be patronising about people who live in the inner cities. It is easy to say that they should help themselves, get off their backsides and generally offer to the community a contribution of the type that we make. That is a very dangerous attitude and a perilous trap to fall into. I believe that self-help is important. I also believe that we have to treat people as part of the same community to which we ourselves belong. It is no good looking down on people and saying, "Here is our charity; you can take this to help yourselves". We have to regard any job or task that is given to people or that people undertake for themselves, as a task that we ourselves undertake. We are all part of the same community. If there is to be a programme along those lines, again we support it.

The third point that I wish to make comes back to something said by the noble Lord, Lord Vinson. We have to create inner cities or urban areas—whatever one chooses to call them—in, to use a French expression, la dimension humaine (the human dimension). We can no longer afford to consider such great tracts of land and buildings as the right environment for people of the 21st century to live in. If that is helped by small firms, as Mr. Trippier recently announced, then so be it. If large firms can help—not, as I think the Secretary of State has said, by investing in inner cities, because that probably will not happen but by sourcing from small firms in inner cities, by doing what BAT has done in one of the projects cited in Managing Workspaces, by contributing to the establishment of a small enterprise—then that is something that must be welcomed and encouraged.

Nevertheless, having said that, I think we must come back to the very important comments that were made by the noble Lord, Lord Bonham-Carter, about something the Americans know as "contract compliance". I believe that we must have a clear statement from the Government that where projects of a largish scale are embarked on by Government with government funding. there must be proper protection for the local community to make sure that the jobs go where they are needed. We cannot have people moving in, completing a contract and moving out again. That is an important and fundamental point.

So far as the Opposition is concerned, we are looking forward to hearing what the Secretary of State has to say about current government policy. He will have to satisfy us on six points, the first being that this is not an elaborate political exercise to undermine elected local authorities. Secondly, he must satisfy us that the Government will work with local communities rather than against them, and that the character of the community will be preserved and encouraged.

Thirdly, we need to be assured that small firms of all kinds will be encouraged—and we make no distinction between service industries, manufacturing, craft industries or whatever they might be—while safeguarding the conditions of the people who work in them; in other words, that there will be no sweatshops; and there must be fair opportunities for the ethnic minorities in the inner cities. Next, we need to be satisfied that the financial institutions which the Government intend to use as vehicles are adapted to the task. We like the idea of development agencies and local enterprise boards. We believe that the urban programme, working through local authorities, has been successful. We should like to see those initiatives continue.

Next, we need a clear line of responsibility. I understand that the noble Lord the Secretary of State has been given the task of co-ordinating the inner city programme. I should like to ask the noble Lord whether that is true and, if it is true, what the expression "co-ordinating the inner city programme" really means in fact. Who is in charge? What we cannot afford is another public relations exercise of the Mr. Richard Branson type. For personal reasons, I would hate to see the noble Lord the Secretary of State disappear under a balloon of hot air and land uncomfortably in the Irish Sea. So what is the new policy, who is in charge, what is to be the role of the local authorities and what financial framework have the Government in mind?

There are major questions that the Government have to answer and we believe that it is time for a major statement of government policy. We would prefer to see this in a White Paper. If the noble Lord the Secretary of State can announce today that there will be a White Paper, the Question put down by my noble friend Lord Dean of Beswick will have achieved a great deal.

7.11 p.m.

Lord Young of Graffham

My Lords, I am indeed grateful to the noble Lord, Lord Dean of Beswick, for giving us the opportunity of having what I thought was billed as an Unstarred Question, but which has turned out to be a not inconsiderable debate into the problems of the inner cities. It is inevitable with a problem of this dimension, which so exercises our interest, that a number of views have been aired. The diversity of those views is important for there can be no mechanical solution to the problems of the inner cities. Tackling those problems requires the contribution of many people and groups within our society.

The great danger in debating such problems is that it leads people to believe, first, that there is a set of identifiable solutions, and, secondly, that the Government can provide those solutions. But those traditional tramlines, along which too often people's thoughts run, have not solved the problems of inner cities in the past and I think that such beliefs have prevented the development of new approaches.

I should be the very first to say that resources are important, and of course the right structure of government is important too. I can give many examples of the new initiatives which the Government have been developing over the past few years, which have put financial resources into the inner cities and have tried new ways of co-ordinating government activities. But the most important step forward is the recognition that the key to tackling the problems of the inner cities lies in people and in participation. Neither is a certain identifiable solution. Both depend upon what actually happens on the streets of the inner cities. But each is fundamental to any durable approach to inner cities.

The people philosophy is central. Personal initiative and self-reliance are just as important to the economic life of the inner cities as they are to community life. Individual responsibility and commitment are crucial to the new projects and initiatives which we are setting up in urban areas, and it is in engaging people on the ground that our initiatives will either succeed or fail. This approach is sometimes misinterpreted. I do not believe that every individual can run a business or that self-employment is the only way to tackle inner city problems. But I do believe that in generating the self-confidence and the dynamism which people need to run their own businesses, we will see many more businesses than we do today and that those qualities will help in all jobs.

Neither is this the policy of leaving people alone to sort out their own problems. Education, training, financial and community support are all essential ingredients to break through the circle of deprivation and poverty which have prevented people from realising their own potential. But we must never forget that we are helping people to realise their own potential. Perhaps it is apposite that I should quote Canon Barnet, who worked in the east end of London and observed, "Careless giving has made the poor poorer". It makes people poorer by taking away their will and drive to succeed themselves. Money alone makes people poorer in spirit and our job is to enrich those spirits. I am sure that in that one simple statement is something with which all sides of your Lordships' House will have no difficulty in agreeing.

Partnerships too are crucial. We need better partnerships within central government. Better targeting and co-ordination for policies at a local level has been the objective of our city action teams and is an important part of the work of our inner city task forces. What is important is not to run programmes as discreet unrelated activities but to focus them around the problems of people in the local area. Better partnerships are needed between central and local government. Most local authorities work happily with us, but, alas, there are times when political philosophy can get in the way. The immensity of the problems which we face in inner cities should override such considerations.

Better partnerships between local authorities are needed too. A coherent strategy has sometimes been prevented as inner cities are covered by a number of local authorities. I hope that the use of urban development corporations and the new mini-urban development corporations will help to speed up the process of development and bring derelict land back into use.

Finally, better partnerships are of course essential between the public and the private sectors. We are continually looking for ways to bring private enterprise into the inner cities. Urban development corporations are proving an important way to achieve that. Many companies are now participating with us in the inner city task forces, and the activities of organisations such as Business in the Community greatly add to the success of these initiatives. So people and participation are the basis of our approach to the inner cities. Within that approach can be identified a number of the policies about which noble Lords spoke during our debate.

The noble Lord, Lord Dean of Beswick, was, I am glad to say, happy to agree with me about the importance of the private sector and of partnerships with local authorities. Indeed, he referred time and time again to the importance of the housing sector. We are committed to restoring the housing sector, but not necessarily just the public housing sector.

The noble Lord, Lord Bonham-Carter, in an aside which I did not quite follow, said that I referred at one time to the importance of cellular telephones. He did not quite see the relevance of that to the inner cities. Of course it is the relevance of wealth creation to the inner cities that I was talking about. The noble Lord referred to ethnic minorities and said how unions should co-operate better with governments. He regretted the fact that it had taken so long to introduce ethnic minority monitoring into the Civil Service. But it was the very Civil Service unions that prevented us from introducing ethnic minority monitoring and there were considerable bouts of industrial action before we could bring that in.

The noble Lord also talked quite passionately about ethnic minorities in the inner cities. It is a subject about which I lay some claim to personal knowledge. My own father arrived in this country some 82 years ago and lived in an inner city. He was part of a wave which followed wave upon wave of people of different ethnic origins who came to our country, who came to the inner cities and then, having progressed, moved on. I too was born in an inner city area.

What we have today is another wave of people of ethnic minorities who have come in in the past 20 or 30 years. Fifty or 80 years ago, there were no government schemes to get people out of the inner cities, but it was accomplished. What we have to do today is to recognise not only that circumstances have changed but also that it is not at all possible to leave all this to he done by government. We must have a partnership between those who live in the inner cities and the Government themselves.

The right reverend Prelate the Bishop of Durham said that private enterprise would not be enough. Of course the state is important in this regard but we cannot leave matters to the state alone. That is a point that I should like to return to later, for if we look at the contributions of the state in clearing some of the inner cities we should realise that over the past few decades we have created far more harm than good in many ways.

The right reverend Prelate referred to some difficulties in social security and housing benefits. If the right reverend Prelate has details of such difficulties I hope that he will write to me and let me know about them, and I shall deal with them. He referred to the poll tax. The arrangements for the community charge are that those who are on social security will receive a rebate of 80 per cent. and the balance of that payment will be adjusted by an increase in their social security. We are not going to impose a tax on people who are not in a position to pay it, but the community charge is an important development. I have no doubt that all noble Lords will have an opportunity to comment on it in the coming months.

My noble friend Lord Bellwin gave us some wise words. He referred to different areas and to different problems. He said that different problems demanded different solutions. He is absolutely right in that. One of the reasons that we have 16 inner city task forces is that we are looking at different areas in parts of our inner cities to find different solutions so that we can learn from that and progress and start to find the quickest and the best way to help to solve the difficulties we have.

My noble friend also referred to bad housekeeping by local authorities. There can be little doubt that in the past many authorities have not proved themselves to be model landlords either in looking after their housing or in collecting their rents. That is a problem which I hope our current housing Bill will attempt to address. My noble friend also referred to a whole series of enterprises and initiatives and made a plea for flexibility. I certainly accede to that and I hope that we shall find ways of being flexible in the future.

The noble Lord, Lord Pitt of Hampstead, asked whether the Government had changed their policies. I must assure the noble Lord that in one respect that he mentioned we have not, alas, changed our policies. He accused us of cutting rate support grant and of wishing to give indiscriminate amounts of money to local government. A number of noble Lords have referred to a reduction in rate support grant. That reduction was accompanied by a vast increase in rating on those who lived within the inner cities. That was one of the most powerful reasons for driving employment out of inner city areas and for making them pockets of unemployment and helping them, one upon the other, to breed further bad conditions.

Lord Pitt of Hampstead

My Lords, that is very much the point. It is the Government's reduction of the rate support grant plus their use of penalties which has caused a lot of the increased rates in the inner London areas. However, it is not only the inner city areas in London that I am talking about. That is the point that I was making and I am afraid that the answer the noble Lord gives me does not meet that point.

Lord Young of Graffham

My Lords, I shall not enter into private debate with the noble Lord, Lord Pitt of Hampstead, but the very word "penalty" is there for a purpose. It was because of the amount of spending by local government that the Government reduced the rate support grant.

I well recall—I have referred to this matter before in your Lordships' House—that about seven years ago officials from the GLC came to me about the provision of workshop accommodation in inner London areas. They said that it would be perfectly possible in Wanstead but not in Lambeth because of the level of rates which already prevailed in that area. The rating policy of many local authorities made employment deserts in our great cities. That is entirely another problem.

My noble friend Lord Vinson made the wise point that the social cohesion of the village was something that we should try to recreate in the inner city. Recreating small-scale societies and making communities whole again is very much part of the policy of the Government. We do not believe in the vast monolithic structures which have come about so often. We believe very much that we should try to recreate small-scale employment and give people the responsibility and opportunity of working for themselves.

The noble Lord, Lord Seebohm, asked me three questions but, alas, my only answer to him is, no. There is no way yet known in which one can create money. So if one wishes to spend more money on housing, that must have an effect on either inflation or interest rates or on other matters. The noble Lord also suggested that we could do something about helping employment or the economy by building many more houses. I am sure the noble Lord is aware that at the present time we have run into one of those periods of brick shortages and skill shortages. I hope very much that we shall see more houses being built, but we have to have the conditions in which we can obtain the skills of those who are needed to build the houses. I hope very much that as part of the policy of the programme which the Government have been following we shall see many of those conditions come about.

I shall be brief with the rest of my remarks. The noble Lord, Lord Sefton of Garston, asked how the 'sixties had failed. It is the monolithic, almost Stalinist housing estates that we created in the fifties and the 'sixties in many of the suburbs of our great cities which today are pockets of unemployment and the areas which are now known as the inner cties.

My former Parliamentary Private Secretary, who is now a junior Minister in my Department, Mr. Robert Atkins, was chairman of the housing committee which received a Civic Trust award in 1971 for a place called Broadwater Farm, where 15 years later there was a riot. It is that structure of living which we are seeking to break up. The housing Bill will break that up by giving people tenancy opportunities to choose their own landlords.

I have just one aside. The noble Lord, Lord Sefton of Garston, said that the Department of Employment should take its civil servants out of London. The department has thousands of civil servants in Sheffield and in Bootle. Over 90 per cent. of the 60,000 people who work for the Department of Employment work well outside London. I suspect that about half of them work in the North.

My noble friend Lord Thomas of Swynnerton invited me to come to the carnival. The great thing about the Notting Hill Carnival is the sense of identity which it gives. I believe that anything of that nature can only serve a good purpose.

The noble Baroness, Lady Fisher of Rednal, was worried about something she had read in the Guardian. I am often worried about matters that I read in the Guardian but I wish to reassure the noble Baroness that it may not come to pass. The noble Baroness referred to the industrial dereliction in the Black Country. I agree with the noble Baroness that that is one of the areas which are now described as the inner city. It is one of a vast number of areas of our country which served the nation well in the Industrial Revolution but which today are scenes of considerable industrial dereliction. That is why I am very glad that we have established an urban development corporation in the Black Country and I believe that it will have good effects.

I wish to pay tribute to the way in which the local authority in Birmingham is working with the Government. We shall initiate many good schemes together and considerable progress will be made in Birmingham. I hope that Birmingham may serve to be a good example for other authorities which are less co-operative.

The noble Lord, Lord Stallard, also gave me a list of authorities which have imposed large increases for bed and breakfast accommodation. Although specific authorities may have had those increases I shall he very interested and I shall look at the figures in London as a whole to see what effect that has had. But it is sometimes difficult to take particular authorities and not see the effect on their neighbours.

The noble Lord, Lord Williams of Elvel, gave me a historical survey which ended up with a number of the schemes which I, alas, am responsible for introducing. I hope that they will prove to be successful. The noble Lord accused me of falling into a trap into which we have definitely not fallen. We are not condescending about the inner cities. We do not believe that their misfortunes serve them right and that they should get off their bottoms and work for themselves. But we do believe in helping people to work for themselves. I regretted the slightly cheap joke at Mr. Branson, who is working very hard and is creating a number of jobs round the country. I gladly welcome all those who come in from the private sector and volunteered their time and effort to work in government schemes to help specifically long-term unemployment. I do not regard that as a matter to be laughed at.

There are many other areas which could be discussed. However, I ask your Lordships to bear in mind two short facts. First, ideas to help inner cities can only be effective in a successful, growing economy. Inner cities are sharing in our economic success. Unemployment in the main conurbations of London, Birmingham, Manchester, Newcastle and even Liverpool has fallen by around 8½ per cent. in the year to May 1987. Unemployment in the areas covered by the eight original inner city task forces fell by more than 9 per cent. Unemployment nationally has fallen by a fraction over 9 per cent. So there have been benefits to the inner cities and I believe that those benefits will continue.

I should be the first to accept that economic growth alone will not be sufficient to tackle the problems of the inner cities. Therefore I should like to assure all noble Lords that they should not be misled by media reports of disagreements between different departments or Ministers. We are working together very happily. But we are also looking at new ways to tackle the problems of the inner cities.

I am glad to say that English Industrial Estates, which up to now has been concentrating on building factories in the North-East, the North-West and many other development areas and has been very active in providing small industrial units and developing science parks, will now be looking to develop and run managed workshops in inner city areas to help people to work either for themselves or in co-operatives and in partnerships. I believe that that process of participation of the private sector, the churches and voluntary organisations will play a critical role.

I commend to your Lordships' House just one example of the sort of initiative which I hope will grow in the years to come. In Leeds, Chappletown Harehills Enterprise Limited is being set up and guided by a board of businessmen and local community leaders. It is supported by central government and the city council. Imperial Chemical Industries is also helping to provide finance. The main aim will be to encourage greater independence among the local community by running employment and training initiatives and by promoting enterprise through providing starter units and enterprise training. That is one way in which central government, local government, the public sector, the private sector, local businessmen and those who live in the inner cities can work together for the greater good.

I hope that the result of the policies of the Government during the course of this Parliament will be that when we have a similar debate at a future time, noble Lords opposite will accept that the policy towards inner cities is working, and working well.

Lord Bonham-Carter

My Lords, before the Minister sits down, will he be so good as to answer a specific question which I put to him in the course of my speech? My question concerns contract compliance. Is the interpretation of the new local government Bill by the Secretary of State for the Environment correct; or is that which is alleged to have been put by the Chancellor of the Duchy of Lancaster correct? In other words, in connection with contract compliance, will the Bill allow a local authority offering a contract to insist on the employment of local people, or, even more, will it allow them to carry out their duties under the Race Relations Act of promoting equality of opportunity and good relations between persons of different groups? That is the whole point of contract compliance.

Lord Young of Graffham

My Lords, although I have the privilege of speaking for a number of government departments in your Lordships' House, the Department of the Environment is not one of them. That Bill will come before your Lordships' House in due course and I assure the noble Lord that there will be nothing in it to prevent the operation of the Race Relations Act. However, I suspect that the details are better left to be explored at that time.