Rental Accommodation: New Building (Hansard, 8 February 1990)

§ The Parliamentary Under-Secretary of State, Department of the Environment (Lord Hesketh)
My Lords, it is estimated that 28,000 new dwellings for letting were started by housing associations and local authorities in 1989. The extension of the Business Expansion Scheme to give tax relief for investment in rented housing has been most successful, leading to around £370 million having been invested so far which we believe should result in some further 7,000 units.

§ Lord Jay
My Lords, are the Government content with the situation in which the number of homeless families is at record levels? We are apparently building fewer houses to let than in almost any year since the war.

§ Lord Hesketh
My Lords, I am sure that the noble Lord is aware of the Government's recent £250 million initiative to help with the problems of homelessness. I believe that it is worth reminding your Lordships that my right honourable friend the Minister for Housing recently departed for Denmark to discuss housing for the homeless. The fact of the matter is this. Fifty-seven per cent. of the GDP of Denmark is consumed in government expenditure compared with 38 per cent. in this country and they have a problem.

§ Lord Monkswell
My Lords, does the reply that we have just received from the Government indicate that we shall export our homeless to Denmark?

§ Lord Hesketh
My Lords, it clearly shows that the answer is not to throw money at the problem.

§ Lord Dean of Beswick
My Lords, although the figures that the Minister gave indicating the increase are welcome, is he aware that there was a meeting in Committee Room 4B on Tuesday morning of your Lordships' all-party group on the building industry which was addressed by representatives of the Building Employers' Confederation and they said quite clearly that over the wider spectrum there has been a 25 per cent. downturn in the building of houses and flats over the past 12 months? They were asked for a remedy. They said that the only thing that could stop a further serious deterioration over the next 12 months would be a modest decrease in the bank rate for the money that they had to borrow. What hope can the Minister give that their wishes will be fulfilled in order to build more houses, which are most urgently required?

§ Lord Hesketh
My Lords, being the Government of the long-term rather than the short-term fix, we believe that inflation must be curbed in order to ensure prosperity for the future.

§ Lord Northfield
My Lords, are the Government working on any new proposals to increase the possibility of houses being built for rent at a low price? Is it not the case that with the land cost of a small house now often 50 per cent. of the cost of the house and perhaps amounting to £50,000 in itself, that means that there is very little chance of getting low-cost rented housing under way in this country?
949 Are the Government working on any proposals in this field to improve the supply of land at a low cost, apart from the small initiative in the rural areas, which is very small indeed and has little effect?

§ Lord Hesketh
My Lords, it is easy to denigrate the rural areas. However, your Lordships will remember the department's circular last April which was to help to provide cheap accommodation for those in rural areas. It is very difficult to provide cheap land where property already exists. Although the tone of the noble Lord's question is extremely seductive, to tell someone who owns a piece of property in the City that he should hand it over free of charge is rather different from discussing a meadow.

§ Lord Boyd-Carpenter
My Lords, is not one of the factors that produce the shortage of cheap land to which my noble friend refers the very restrictive attitude of quite a number of local authority planning committees?

§ Lord Hesketh
My Lords, I do not wish to return to the burdens of last year's Housing and Local Government Act. However, I have to say, as I said then, that the 75 people who signed the petition for the cheap housing to be provided are also the 75 who signed the protest against the planning authority granting planning permission.

§ The Earl of Onslow
My Lords, is my noble friend aware that with the difficulty of selling large amounts of property, certainly in the South-East, estate agents' books are now very full of property to rent? There is now no longer a shortage of property to rent in the South-East of England. It may be at the wrong price but there is no shortage of property to rent.

§ Lord Hesketh
My Lords, I wish that I could take as optimistic a view as my noble friend. However, I believe that there will always be a shortage of housing long after even I have left the House.

§ Lord Jay
My Lords, how many houses to let do the Government expect to be built in the present year?

§ Lord Hesketh
My Lords, expenditure this year in the public sector and with housing associations will be some £4.4 billion together with other substantial sums of money when one takes into account the indicators that come from the success of the Government's BES initiative on rented accommodation.