Orders of the Day — Housing Subsidies Bill

Part of the debate – in the House of Commons at 12:00 am on 15 December 1965.

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Photo of Sir Eric Errington Sir Eric Errington , Aldershot 12:00, 15 December 1965

If I got a quotation for that figure, I would certainly want a second and third quotation against which to check it.

The Bill helps local authorities, but I am very unhappy about the way in which some of the money will be spent. It is all very well to say that there is more money and that it will be dealt with faithfully. But, as far as I can see, there will be no check on the way in which funds are used under the Bill. Presumably it will increase very much the number of people occupying council houses. Bearing in mind what I said about the standard of expectation, will not this escalation in price continue until such time that it may be essential to increase the subsidy even more? This matter should be examined very carefully.

The Joint Parliamentary Secretary talked about "industrialised building". We have had the benefit of industrialised building in my constituency. For large buildings like barracks it is extremely good and it is reasonably cheap provided that the central place in which the components are made is near and they can be taken without difficulty from one part of the area which is being developed to another. However, I do not think that industrialised building is likely materially to improve the ordinary dwelling-house situation.

People talk about luxury rents. I do not know what a luxury rent is. It means different things according to the way in which the expression is used. The White Paper which started the idea of the housing associations was supposed to deal with rents of between £6 and £8. I do not know whether one would call rents between those figures luxury rents. The idea of the housing associations was not meant for the ordinary working man.

There appears to be a feeling in the Government's mind against owner-occupiers. I do not know why this should be so, because the Minister, at Stevenage, spoke very favourably of the owner-occupier. I wonder why it was not thought possible to consider ways to avoid this very large sum being taken out of our depleted finances? Why could not use be made of the funds which are flowing back from the advances made in July, 1961, for the purchase of pre-1919 houses? The House will recollect that £98 million out of £100 million made available by the Government was used by the building societies to enable people to buy the older houses. That money is coming in again. Is it not possible for help to be given by means of the use of this money again?

Cannot something be done to ease the position concerning deposits? A man and his wife came to see me at my constituency. He had £25 a week. He was willing to buy a house if he could get one, but he had not enough money to cover the deposit and the legal fees. He was of good type, and was prepared to take on the responsibility of a house, but, as you might imagine, Mr. Deputy Speaker, in view of my constituency, he had just come out of the Army and had been unable to save the necessary amount for these charges. Cannot something be done to prevent the difference, to which the hon. Member for Salford, East referred, and which might be a very important difference, between the council house occupier and the owner-occupier?

Another thing which would attract owner-occupiers would be if the Minister were prepared to make allowance for the potential of people who are in certain classes of job. He could, perhaps, make provision so that the mortgage repayment was less if a person in a short time was due to get promotion. One way in which this could be done is what is called the "balloon" way. For a time, 50 per cent. of the mortgage is paid in the ordinary way and the remaining 50 per cent. is repaid after the house has been sold. I do not know whether this possibility has been considered. Another possibility is the American system of Government guarantee. This would have to be worked out in consultation with the insurance companies.

I wish to say a few words about the possibility of the sale of council houses with a view to increasing the number of owner-occupiers and ensuring that there is not a very large block of council houses, then a block of owner-occupied houses, and so on. There is the danger, which is referred to in an article in The Times of 11 th December, that children of council house tenants, growing up in the enclave atmosphere of council house estates, and used to expecting extremely low accommodation costs, will inevitably create an additional demand for council houses. No solution to that problem can be found in increasing council house rents to an economic level. The only level of rents of any relevance to the problem is the level of free market rents which in addition to being politically impossible would also be inequitable—owner-occupiers who purchased houses 20 years ago are not paying free market prices today for their accommodation … Therefore, in effect, the price should be the "historic" cost, taking account of the fact that the house was built some years ago. The article adds that the way in which it was worked out was that in 1964 some 34 per cent. of the households in council houses had more than £25 a week and 22 per cent. of them had more than £30 a week. The proposition of council tenants becoming owner-occupiers seems not to be impossible but even desirable. Perhaps I have not put it as clearly as I might have done, but it would certainly be unfortunate if we had two nations, one of the council house occupiers and the other of owner-occupiers, even more in the future than the present.

I do not propose to go further into the question of building by private enterprise to let, though there is much to be said, but I will conclude with a word about the situation of the ex-Service man. I put down a Question to the right hon. Gentleman, and in his Answer he said that he had reason to believe that something was being done by most local authorities about ex-Service men. This is a very difficult problem, as it must be, particularly in a town in which many people leave the Service. As I indicated before, there was the difficulty of a man who came to see me and who had tried to obtain a council house but had found that there was none available. Can the Minister give a clear indication that he appreciates the importance of this problem? I am not sure whether he has power in the Bill to deal with this matter, but would he consider, in view of the number of people coming out of the Services, whether any special help could be given to them to meet their housing needs?