Clause 41 - Payments towards local authority indebtedness
Local Government Bill
11:00 am

Mr Andrew Turner (Isle of Wight, Conservative)

I should like to assume that many similar points would have been made in debating this clause as were made during the debate on clause 40. I make that presumption in order to save time, but hon. Members may wish to intervene if it is untrue.

I wish to return to some of the answers that the Minister gave to some of the questions that were asked about clause 40 and to apply them to clause 41. I thank the Minister for the good answers that he directed to me on the income stream, even though they were answers not to my questions but, I suspect, to those of my hon. Friend the Member for New Forest, West.

In order to save time, I will not repeat my speech on clause 40, but I ask the Minister to go back over it and to assume that it was made in reference to clause 41. I wish him to explain how local authorities have got themselves into a position where they need to have debts written off. I understand the more recent history of that topic. My hon. Friend the Member for Cotswold referred to local authorities—some of them are Conservative-controlled councils—that have large debts because they have recently taken control of hitherto badly run local authorities, and my hon. Friend the Member for New Forest, West mentioned other local authorities that have failed to invest sufficient sums in the maintenance of their capital stock. Can the Minister tell me whether these authorities have a history of either having a large surplus or a particularly badly maintained public housing stock which has led them to need—or to feel that they need—to transfer the stock with a large overhanging debt? I ask that because I have a genuine desire for more information on it. Can he give the Committee additional information on why this clause might be necessary, in the context of the remarks I made in the previous debate?

Mr Nick Raynsford (Minister of State (Local and Regional Government), Office of the Deputy Prime Minister; Greenwich and Woolwich, Labour)

I am sorry that the hon. Gentleman did not listen more closely to earlier debates, because if he had done so he would know that authorities in areas of low capital value will not have the same opportunity as those in the southern areas to raise large capital sums through the sale of assets. That problem will be compounded if they have also incurred substantial debt that they are still servicing through the need to invest in housing over the years. That is of no relevance to the quality of the management of the stock. Those matters are to do with the market and the cost of providing housing. In some cases, individual authorities have not managed their stock well, and that may be an added reason why they wish to transfer to another body. In other cases, they will have done that very well, but cannot counter the market factors that I have described and which make it impossible for them to gain sufficient sums from the disposal of the asset to write off the outstanding debt.

We have made proper provision to ensure that there is fair treatment for authorities in all parts of the country, irrespective of the capital values that apply in

their areas and of whether the housing stock has been managed well or badly. I hope that the hon. Gentleman will recognise that his anxieties and fears are groundless. This is a sensible provision and I hope that he and other hon. Members will agree that clause 41 should stand part of the Bill.

Question put and agreed to.

Clause 41 ordered to stand part of the Bill.