Housing Completions 1991 (Hansard, 26 February 1992)

§ Lord Jay
My Lords, as almost every year between 1945 and the 1970s over a quarter of a million houses were built on average, is that not a rather disappointing figure? Can the Minister say how many of those new houses were to let rather than for sale?

§ Baroness Blatch
My Lords, I do not have specific figures in relation to the noble Lord's latter question, but I shall do what I can to obtain them for him.
It is also worth noting that in 1961 each household comprised 3.09 people. Since that time the figure has fallen due to a number of factors and social trends: children leaving home and living in separate accommodation, broken marriages, young people living with partners and then breaking up, and the number of young pregnant girls, who have priority on housing lists. A number of factors make it particularly difficult to cope with the rising demand for housing.

§ Lord Barnett
My Lords, has the Minister seen a very interesting study produced by a well-known international firm of chartered accountants, Arthur Andersen, which, in relation to public accounts, refers to the need to distinguish between capital and current expenditure? While I would be the last person to ignore cash limits, having introduced them, does the Minister accept the further point made in that report that if we applied commercial methods of accounting we might find more money for public borrowing for investment in, for example, housing?

§ Baroness Blatch
My Lords, I certainly understand the distinction between current and capital expenditure. That is very much behind the call—which I have no doubt we shall hear before the end of this Question—for the use of capital receipts. It also has to be said that large sums of money are being spent, both in capital and current expenditure, by housing associations and local authorities. In 1991–92 capital expenditure in housing investment is £4.3 billion the housing revenue subsidy is £3.7 billion and rising all the time and there is also housing corporation expenditure. At the end of the day it is all money and it has to be met by the taxpayer. We believe that we have to live within what the taxpayer can afford. If 262 there is any argument for additional expenditure from noble Lords on the other side of the House we are eager to hear their plans.

§ Lord Dean of Beswick
My Lords, is the Minister aware that the figure she quoted in her Answer represents less than half the annual output which informed people dealing with the housing problem consider necessary and that it is felt that the target should be nearer half a million houses a year? Has the Minister had time to familiarise herself with a report which has been released today by the citizens advice bureaux on the basis of a survey of country areas which shows an appalling shortage—in fact a nil factor—of housing being provided in such areas? What will the Minister do about that?

§ Baroness Blatch
My Lords, I am very familiar with the report which has been issued today by the citizens advice bureaux. I should preface any comment by saying what a marvellous job they do in advising people on a range of matters and particularly regarding housing. The report is specifically concerned with rural housing. The Government believe that that is an important sector of housing. Housing corporation funding is to rise to over £2 billion a year, and a special part of that programme relates to rural housing the special housing corporation rural programme for villages with populations below 3,000 is to increase to 2,250 approvals a year special capital allocations to rural local authorities, which amounted to £50 million this year, to produce 1,500 houses, will be increased by a further £30 million we have provided support for the Rural Housing Trust and planning concessions for low-cost rural housing on sites where commercial housing would not normally be permitted. In addition, we have encouraged local authorities, when working with developers, to include affordable housing in developments. We are doing a great deal to ensure that housing is available to people in rural areas.

§ Lord Mellish
My Lords, the Question relates to 1991, but can the Minister say something about the future because the construction industry is in grave trouble, primarily because of the slump in housing? Is she aware that in the Macmillan era, which is not so long ago—at least I remember it—the construction of 330,000 houses in any one year was regarded as normal? Many noble Lords opposite who are supporters of the party occupying that Front Bench will remember that very well. I beg the Minister to say something about the future to give the construction industry a lift?

§ Baroness Blatch
My Lords, it is not for me to pre-empt Budgets in that respect. However, I can say that in the public housing sector, as I have already said, it is planned that housing corporation output should increase from 22,000 houses to 51,000 by 1993. We believe in doing what we can in relation to the public housing sector. I should like to make one point regarding the private housing sector. There is a great deal of private housing still without buyers. Those houses will have to be sold and that capacity taken up before there is any buoyancy in the construction 263 industry. I shall start where the noble Lord finished: yes, there is a problem in the construction industry and that is well recognised.

§ Lord Stallard
My Lords, will the noble Baroness accept that it is a widespread view that one of the major causes of the increase in homelessness is the shortage of affordable housing? Will she further accept the widely held opinion that one way to provide affordable housing is to allow councils to spend the money that they receive from selling council property to replace their stock? In the present pre-election atmosphere, when many promises are being made, will the Government promise to accede to demands from all over the country that councils now be allowed to spend their own money?

§ Baroness Blatch
My Lords, we are doing a great deal to boost affordable housing for young people. Demand will always outstrip the amount that we can provide, given that the taxpayer has to foot the bill. With regard to spending of capital receipts, I have said many times that capital receipts are greatest where housing needs are least; where housing needs are the greatest, capital receipts are the least. Therefore we use another system to target resources on areas with the greatest need.

§ Lord Williams of Elvel
My Lords, I am not sure that the Minister gave a considered reply to my noble friend Lord Barnett. Will she confirm that the Government and the Department of the Environment have considered the report produced by Arthur Andersen on public accounting and how it should be managed and studied in particular the distinction between capital and revenue receipts and how they should be handled? If so, will they give a considered reply? If they have not done so, will the Minister do the House the favour perhaps of reading it and giving us a reply?

§ Baroness Blatch
My Lords, we are aware of the report. We have read it. I do not have a specific response in relation to spending on housing. However, I have given noble Lords the answer that capital spending is buoyant and revenue spending is buoyant. All spending has to be funded by the taxpayer and at the end of the day our primary concern must be for those who foot the bill. Deciding whether one capitalises spending or puts it on current account must he a matter for my right honourable friend the Chancellor.