In Section Five of The Housing, etc., Act, 1923—
I beg to move, "That the Clause be read a Second time."
With regard to the first point, Section 5 of the Act of 1923 provides for advances being made: by local authorities to persons who are willing to build houses. This has been considered by some of the principal local authorities, certainly by the London County Council, and it has been thought that it does not apply to flats. I do not think that was ever the intention of Parliament, and the object of these words is to make it plain that the London County Council and other bodies should have power to make advances under the Section for the purpose of flats as well as for single houses. The Government have put down an Amendment to the Schedule which is thought to meet this point. Personally, I am not at all sure that it does meet it, but if the Minister wishes the point to be met, and will consider between now and Report Stage whether the words he has put down do meet the point, I should not press this matter now.
The other matter which the new Clause proposes to deal with is also an Amendment of Section 5. It proposes to leave out the words "ninety per cent. of." At the present time local authorities may only advance 90 per cent. of the value of the proposed house which is to be built, and the effect of this Clause if carried would be to enable them to advance the whole value of the house. I quite realise that to an ordinary commercial lender it is essential to provide for a margin, and the margin provided is generally substantially more than 10 per cent. But here the local authority is making a loan to a person who will provide his own house in lieu of the obligation which it would otherwise have to undertake of having to build a house for him. Therefore, I submit there is no reason why it should not take the whole risk, because it is not greater than it would be if it built the house itself. We have heard it often that many working people cannot afford to buy their own houses. At the present time the only thing which prevents them is the necessity of finding this 10 per cent, of the purchase price, which means that on a house of the valise of £500 he has to put down £50. If the local authority had the power to advance the whole amount that difficulty would disappear, and the working man who desired to build a house would have no more difficulty in doing so than in renting it. What he would have to pay by way of interest and sinking fond would be little, if anything, more than he would have to pay for rent.
I am advised that the first part of the Clause is met by the Amendment which I have put on the Paper and which will be moved in due course. With regard to the second, I should have thought that 90 per cent. is a very substantial part After all, you must give the man who proposes to own the house some financial interest in it. If the local authority advances nine-tenths of the money that is really going a long way to enable him to take full advantage of this.
At the present time local authorities are only able to advance 90 per cent. of the value, not the cost, and the difference between value and cost which a purchaser would have to find, even if the Amendment be accepted, is more than is found in ordinary cases where a person is buying a house, and the value and the cost price are approximately the same. The Corporation and building societies lend only a proportion of value. Even if you lent 100 per cent. of the value, the purchaser would have to find a substantial sum of money.
Does the Amendment imply that anybody under this scheme who builds tenements will be allowed to build them, and get the Government subsidy? I suggest it is entirely against the spirit of this Bill and the housing scheme. The whole object of the Bill is to provide every Englishman with his castle or his own house with a respectable piece of land with it, and this Amendment makes it possible to build blocks of flats. It should be rejected with no uncertain voice. I am not sure if the Minister of Health is accepting the Amendment, but if he decline to do so, I will support him and I hope those around me will also do this. It is iniquitous to say that more tenement houses, such as have brought all the trouble on the Clyde should be built in England under this scheme.