Housing (Scotland) Bill

Part of the debate – in the House of Commons at 12:00 am on 3 July 1952.

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Photo of Mr William Hannan Mr William Hannan , Glasgow Maryhill 12:00, 3 July 1952

Since entering this House in 1945 it has been my privilege on occasions, when sitting on the benches opposite, to make several short speeches. They were indeed no more than interjections, and sometimes a dialogue was carried on between the occupant of the Chair and myself, as one of the then Government Whips, in conducting the business. The longest speech was one of 12 words, when I moved, "That the Bill be committed to a Committee of the whole House." On other occasions, it gave great pleasure when my speech was to adjourn the House. This is the first occasion on which I venture to address the House at length, and although this is not technically a maiden speech, I hope that the House will extend its understanding and sympathy to me in making some remarks concerning the Bill now before the House.

This Bill, as the Minister agreed, and as my right hon. Friend the Member for Greenock (Mr. McNeil) insisted, is a reflection of the financial policy of the Government. Although I am sure the hon. and gallant Member for Berwick and East Lothian (Major Anstruther-Gray) will, under present circumstances, understand if I do not follow his remarks, it is my opinion that the economies of which he spoke will follow as a direct consequence of this Bill. The Minister of Housing and Local Govern-ment, in introducing the English Bill, said that the need for this review at this time arose primarily from two increases in the rate of interest on loans to local authorities, and there is no difference on that point.

I wish to ask the Joint Under-Secretary of State for Scotland if he would not agree that, apart from the increase on interest rates, there is a case for an increase in subsidies. On the information supplied to me, and from the memorandum of the local authorities, there would appear to be a very strong case that, apart from the increase in interest rates, a further increase could have been justified because of the increased capital costs.

There is this difference between the local authorities and the Department of Health for Scotland on what I consider to be the fundamental approach on which all the considerations should be based. It is the premise from which we start. I am sorry that the Minister of Housing and Local Government is not present. He said in his speech on 22nd April: To fix what should be the amount of the subsidy, agreement has to be reached on certain premises. These are broadly three in number. First, there is the average capital cost of the notional house, second, the average cost of maintenance, and, third, what has to be taken as a notional rent."—[OFFICIAL REPORT, April 22, 1952; Vol. 499, c. 230.] Figures have already been given of what the local authorities insist upon as the present day cost of building houses. They are at the end of the construction of building houses, and experience in these things goes a long way. They insist that £1,900 is much nearer the figure for a four apartment house than £1,635. In England the Minister of Housing and Local Government indicated that he had got agreement with the local authorities after an investigation committee had been appointed or an inquiry had been held. Has such a committee or cost-finding inquiry been held in Scotland in order to make an adjudication? All of us can see that, even on the difference of £250, the accumulated cost over 60 years will come to a startling figure.

I have obtained some figures on the interest charges on the £1,600 which the Department of Health suggests. Assuming that that figure is right for a four apartment house, over 60 years the annuity required to repay capital and interest would be £57 16s. 3d. The total over the 60 years for a house originally costing £1,600 comes to £3,460. At 4¼ per cent., the new rate, the total over the same period, is actually £1,000 more —that is, £4,446. We are getting into a fantastic situation when we allow that to continue. My plea to the Government is to have another meeting and see if they cannot agree to split the difference between the figures. Some gesture like that would encourage the local authorities to do the great job which confronts them.

I intended to speak on the question of rents. My right hon. Friend the Member for Greenock has mentioned the fact that £33 is nearer the figure. The sum of £42 is the figure that the Government have suggested should be charged for a four-apartment house, but that is in danger of being increased because of the new Bank Rate, which in turn means increasing the cost of living in as much as rent is a big factor in the calculations of the ordinary people. In 1950 the present Prime Minister, when Leader of the Opposition, criticised the Labour Government for charging 25s. to 27s. a week for rent which he said was a hollow mockery of the housing plans, for it did not provide people with houses which they so sadly required at rents which they could pay. The Government are in danger of upsetting the present housing plans by reason of these much increased rents.

The general economic policy of the Government is going to restrict and reduce the demand for houses. Indeed, it could be said that it will act in the way which some members of the Government want. Such works as water schemes, sewerage schemes and so on will feel the effect of these increased charges. Recently the Minister of Housing and Local Government issued a circular to local authorities in England asking them to try to effect economies in the construction of water works and sewerage undertakings. These things are, of course, fundamental to any housing scheme, for they must be built before houses can be put up at all. Has the Scottish Office issued a similar instruction, because if it has it will increase the concern of those of us who are apprehensive about die overall economic and financial policy of the Government? What, in fact, is going to happen is that finance will determine the needs of the people instead of physical controls deciding social priorities.

A point in the Government's policy which I want to criticise for a few moments is their suggestion that local authorities should be empowered to sell houses. I would ask them to alter their attitude towards that scheme. They propose an increase in the number of houses for sale from one in ten under the previous Administration to one in five under this. Surely it is appreciated now that the evidence is overwhelming that there is no great demand to buy houses, but rather that the supreme need is for houses to let.

The Joint Under-Secretary of State comes from Glasgow and knows perfectly well what happened in Merrylee. I do not want to be controversial or appear to be overbearing on this subject, but he knows that the local elections gave a clear indication of the signs of anger at the proposals which were then made. Despite the help of the Secretary of State to restrict these houses to certain classes of people, like existing tenants, those who were ill, and those who would ordinarily be allocated houses within the next year from the large waiting list of 100,000, what was the result? Of a total of 131 applicants, only 24 came from existing tenants, only seven from the 100,000 on the waiting list for accommodation, and 100 from those who applied on health grounds.

What were they asked to pay? For a three-apartment house the deposit was £228 and £2 11s. 1d. weekly as repayment of capital and interest. For a four-apartment house they were asked to pay £323 deposit and £3 9s. weekly. On a five-apartment house the deposit was £354 and the weekly repayment £3 12s. 9d. I know the hon. and gallant Member is sincere in these matters, but does he not honestly think that these figures are an affront to the people in his constituency? They certainly are to the people in the constituency of Maryhill in Glasgow which I have the honour to represent. They are asked to pay weekly amounts like that out of wages of £7, 8 and £9 a week.

It is interesting to look at the total incomes of the Scottish people. I refer hon. Members to the Annul Report of the Inland Revenue Commission for these figures. The total incomes of Scotland number 1,771,000, and of that total 1,164,000 earned £350 a year or under. Those earning £500 a year and under total 1,500,000. It is a well-known fact that the people in the north do not earn the high salaries and wages which can be earned in the south, particularly in the London area. In view of all these telling facts, I ask the Government to review at once the policy of houses for sale. They should stop it, and our primary aim should be to construct houses to let.

I want to conclude with this point. A large number of decent people for whom I am speaking now, but who are supporters of the party opposite, though they want to assume the responsibility of buying houses and entering upon a mortgage for them, find that the position will go hard with them. The hon. Gentleman the Member for Altrincham and Sale (Mr. Erroll), speaking recently on a new Clause in the Finance Bill giving relief from tax in respect of payments to local authorities and building societies, said this: The person who wishes to own his own house has to carry personally the full extra burden of the increased money rates now in force. In fact, it is clearly becoming very difficult indeed for younger married couples to be able to afford to own a home of their own because the charges involved are so considerable. They alone will receive no relief at all from the Treasury or the Exchequer.I feel that this new Clause, which is designed to give them a measure of relief, should he welcomed by my hon. Friends on this side of the House since we are such fanatical believers in a property-owning democracy. We should live up to our aims and help where possible those who are trying and are anxious to own homes of their own." —[OFFICIAL REPORT, 17th June, 1952; Vol. 502, c. 1072.] The cost of living has gone up, but these people are being asked to pay these excessive sums for owning their own homes. That is an added reason why their tastes should be catered for by proper attention to the admirable Report, issued by the Scottish Office. I want to congratulate the officials on the production of the Report—dealing with the Housing of Special Groups.

A policy of greater assistance to the local authorities in the acquisition of the properties which are being abandoned in Glasgow would make a useful contribution. I am not suggesting that it will be a solution to the housing problem. There are properties in Glasgow which the local authority cannot acquire because the ground burdens are excessive. The properties would be offered by the owners free of cost, but the local authority are hesitant, because they are not provided with assistance. We should encourage social ownership in housing. It is in that direction that a solution of the housing problem lies.

Private investment of capital will never again be able to provide for the needs of our people in houses to let. It will need to fall to public authorities and to public enterprise to do the job. Just as the great industries of coal and railways had to be salvaged from wreck and ruin because the nation needed them, so housing will require to be saved. I am hopeful that at no distant date the community will think fit to acquire all rented houses as a form of social ownership, pooling the rents and equalising them, and charging individuals in the higher income groups with the full economic rent. We can do that, and in doing so we shall in the end create still better citizens and make Britain a brighter and freer country than she has ever been before.