§ Mr. Norman Tebbit
asked the Secretary of State for the Environment whether he has now completed his review of the use of direct labour by local authorities; and whether he will make a statement.
§ Mr. Graham Page
After full consideration of all the views expressed to him by the various interests which he has consulted, my right hon. Friend has decided to issue circulars to local authorities in England which will notify them of the introduction of new arrangements as follows.
For highway works, the present levels of £50,000—direct labour costs only—on trunk roads and £100,000—total scheme cost—on principal roads above which direct labour organisations must compete with private contractors will be reduced to £40,000—total cost excluding land—on new construction and improvement on both trunk and principal roads, 430W and on maintenance works on trunk roads.
For water and sewerage schemes costing more than £100,000 or, if greater, the product of a 1p rate—sewerage—or a 2p rate—water—on which the use of direct labour is proposed, approval for loan sanction purposes will be withheld until a certificate is furnished that competitive tendering has taken place and direct labour tender was the most favourable received. A similar certificate will be required for all schemes, irrespective of their size, for which application for grant is made.
In order to allow the bodies concerned adequate time to adjust their proposed programmes of work, the new arrangements will not take effect until 1st April, 1973.
Further consideration is being given to the question of the use of direct labour for housing work.