Houses: Starts and Completions (Hansard, 29 April 1991)

§ The Parliamentary Under-Secretary of State, Department of the Environment (Baroness Blatch)
My Lords, house building figures for March 1991 are not yet available. However, in the three months up to February 1991, 31,400 new dwellings were started in Great Britain and 43,900 were completed.

§ Lord Dean of Beswick
My Lords, I am grateful to the Minister for that reply. Does she not agree that the figures are somewhat disappointing although there are signs that the building industry is bottoming out? Is she not aware that at a meeting in one of your Lordships' Committee Rooms last week representatives of the Building Employers Confederation told Members of your Lordships' House that tender prices in the building industry are at present the most advantageous in living memory? Therefore, would it not make sense for the Government to allow local authorities to make available increased sums of money from their capital receipts so enabling those authorities and the housing associations to take advantage of the very good terms which can now be negotiated and thereby improve the disappointing figures?

§ Baroness Blatch
My Lords, in 1988 private enterprise house building was at its highest since 1973. From that peak and because of the need to raise interest rates to keep down inflation, the fall during 1989–90 was not surprising. However, the Government's clear and prime task remains the overwhelming defeat of inflation.
The noble Lord assumes that local authorities are the only providers of houses. He asks whether credit approvals can be given to local authorities to enable them to spend their receipts. The point has been made a number of times that the authorities with the highest receipts are not those with the highest need. Government compensate for that by making sure that allocations for credit approval go to the authorities with the greatest need.

§ Lord Mellish
My Lords, I reinforce what has been said: the building industry is crying out for a lead. It is up to the Government to give that lead, particularly at this time. Will the Minister not say to those sensible councils—and there are quite a few—which are not allowed to use money from the sale of council houses, that they can now use that money to instruct the building industry to start building houses for them?

§ Baroness Blatch
My Lords, the same argument applies as regards credit approvals. The areas of highest need would not have the money to spend. The noble Lord, Lord Mellish, makes a very important point and I hope that nothing I say detracts from a recognition of the difficulties experienced by the 474 building industry. However, the best thing that the Government can do for the building industry is to continue the downward trend of inflation. That will increase work for the building industry.

§ Lord Ezra
My Lords, with further reference to the meeting mentioned by the noble Lord, Lord Dean of Beswick, which was presided over by the noble Lord, Lord Mellish, are the Government not concerned about the massive ebbs and flows in house building requirements and their impact on training and the retention of skilled personnel? Is the noble Baroness aware that one result is to open up the sector more and more to foreign competition?

§ Baroness Blatch
My Lords, I understand entirely the point raised by the noble Lord about the difficulties experienced by the building industry. When interest rates were lower the industry was in good heart and reached a peak. As I said, in 1988 the peak was greater than that reached in 1973. The best course that we can take for the building industry is to continue our war against inflation and to bring down interest rates as is beginning to happen.

§ Lord Stoddart of Swindon
My Lords, is it not a serious situation when 121,900 completions represent half the number required to meet the needs arising from new family formation, slum clearance and houses going out of occupation? Does that not mean that in the years ahead there will be a severe shortage of housing which in turn will push up the price of housing and make it less available to those in need at the bottom end of the income scale?

§ Baroness Blatch
My Lords, I return to the central point. Economic buoyancy will help the building of houses. I must throw a question back to the noble Lord in view of what the leader of his party said yesterday. If there is no more money to come from the Labour Party for housing, where will it come from? I believe that the noble Lord is suggesting that money from government is the answer to the problem.
I am not apologetic about the Government's record. Since 1979, housing stock has risen by 2 million, which is far in excess of the increase in population. Owner occupation has risen from 57 per cent. to 69 per cent. The Housing Corporation's expenditure is set to rise to £2 billion from f I billion only a year ago. Housing benefit has increased to 100 per cent. of eligible rent and has doubled since 1979. I could continue: I have no need to apologise for the record of the Government. At present there is a problem as regards house building. However, the best thing that we can do for house builders is to make sure that the economic climate is right so that more houses can be built to satisfy the need for them.

§ Lord McIntosh of Haringey
My Lords, the Minister chose to accuse my noble friend Lord Dean of Beswick of being selective when he spoke of the need for more council house starts. Is it not the case that her answers refer purely to private sector starts and completions? Does the Minister not agree that it 475 would be better if we thought about both the private and public sectors contributing to the solution of housing need?

§ Baroness Blatch
My Lords, the figures I gave in my reply related to all housing.

§ Lord Dean of Beswick
My Lords, the Minister made a mistake in saying that I spoke only of councils building houses. I did not. I specifically referred also to the Housing Corporation and housing associations. The Minister makes the point that she is defending the Government's record. She must be aware that over the past 13 years since the Government have been in office, 1 he house building record in this country has been the worst of any 10 years since the war. If the end product is that more people are sleeping in boxes every winter, despite the valiant efforts of Sir George Young last winter, does the Minister believe that we as a society should accept that as a cure for inflation? I do not.

§ Baroness Blatch
My Lords, it depends to which statistic the noble Lord is referring. If he is referring to the building done between the First World War and the Second World War, that is understandable. It started from an extremely low base.

§ Lord Dean of Beswick
My Lords, I am speaking of the last world war.

§ Baroness Blatch
My Lords, in that case the figures are not the worst if one takes house building as a whole. The noble Lord referred to housing associations. I was saying that their budget is set to rise to £2 billion. The noble Lord's figures may be right if he is referring exclusively to local authority housing It has been a deliberate policy of the Government to switch responsibility for providing houses from local authorities to the private sector and to housing associations.

§ Lord Stoddart of Swindon
My Lords, the noble Baroness asked me a question: she is entitled to an answer: she wanted to know what Labour Party policy was on the matter. The noble Baroness will be aware that I do not speak for the Labour Front Bench in an official capacity.

Noble Lords
Question!

§ Lord Stoddart of Swindon
My Lords, is the noble Baroness aware that during any period of Labour government the housing starts figure never fell to the low level that we see today?

§ Baroness Blatch
My Lords, I cannot answer that question specifically. However, the record of this Government throughout the past decade in addressing the specific problems of housing, whether new house build, housing the homeless or helping people to buy their own homes, is unequalled.