Redevelopment (Portsmouth)

Orders of the Day — Iron and Steel Bill – in the House of Commons at 12:00 am on 19th January 1967.

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Motion made, and Question proposed, That this House do now adjourn. —[Mr. McBride.]

11.3 p.m.

Photo of Mr Frank Judd Mr Frank Judd , Portsmouth West

I call the attention of the House to a problem affecting my constituency, although it is a problem which has far wider implications for the country as a whole. Professor Buchanan, in his interesting study of South Hampshire, drew attention to the obsolescence of much of the housing in Portsmouth. In examining this question, I would emphasise that one has to look at the history of Portsmouth.

There was the vast expansion of the Royal Navy during the 19th century, accompanied by expansion of the dockyard and the consequent building of many houses as homes for the people working there. These were mainly in streets of small, two-storeyed houses in terraces, but there were few tenements, and no back-to-back houses. Of the 64,000 dwellings in the city, more than 14,000 are more than 100 years old, and more than 15,000 are older than sixty years. All are in intensely developed areas, and Portsmouth, with 23 people to the acre, has one of the highest densities in the country, outside London.

Since 1957, there have been 4,850 dwellings dealt with as unfit under the terms of the Housing Act, 1957, out of a total clearance, including business premises, of about 5,500 buildings. The city is to undertake a new programme of building at least 4,800 houses, and this is the time to take stock of some of the social consequences of this programme, and of the cost, and the distribution of the financial burden of urban renewal.

There is a severe shortage of land, as well as of houses, in Portsmouth. Extensive destruction of artisan type houses occurred during the last war. Owing to the insular character of the city it can only extend northwards into the mainland, and its geography is therefore important. The older houses are near to the dockyard, and the newer property is comparatively far from it although the dockyard is the main employer of labour.

All of this, coupled with the fact that most property now to be dealt with, although technically unfit by standards laid down in the Housing Act, is not what would usually be regarded as slum property, means that prices remain high. The average market price for houses compulsorily acquired is between £1,400 and £1,600.

The local authority, looking at this problem, had hoped that there might be some chance to proceed with the new programme under procedure other than that in Section 4 of the Housing Act; for example, under the planning Act. But the general economic situation meant that there were considerable doubts about the certainty of Government financial support. Having discharged, as a city, its statutory obligations most efficiently, in any case the number of substandard houses had in fact been notified.

Looking at the deeper social implications of this policy, we see that 41 per cent. of the houses to be affected are owner-occupied. There are hardly any large-scale landowners in the area, and those houses which are owned other than by the occupiers are mainly owned by people of limited means who have invested in one other house as a means of securing an income, for example, in old age. Of the owner-occupiers themselves, most are on small incomes or on old-age pensions.

As people look at this new programme, they see their security in jeopardy. They see themselves faced with the higher cost of accommodation in local authority housing. Looking at the situation in perspective, we can see the development of vast council estates without any real study of the social and sociological implications of reduced proportions of owner-occupiers in the community.

In an operation of this sort, it is essential that justice should be seen to be done. As ordinary people look at existing legislation, what they see, in fact, is a jungle. They see different provisions and subsections under the Housing Act, and they see different Acts, even, under which compulsory purchase can be handled.

If we are looking at this apparent injustice, we could hardly do better than read an interesting article contributed to the Portsmouth Evening News by a correspondent. I should like to quote from the article. I should like to quote the effects of this plan in a particular street, and he says: Stamford Street, Landport, is coming down. A survey by officials of Portsmouth Public Health Department revealed it to be in an area where most houses were unfit for habitation, and Portsmouth Corporation obtained a compulsory purchase order as the first step towards demolition and redevelopment.Three typical houses in Stamford Street are numbers 18, 51 and 77. In them the whole injustice of the Housing Act compensation system is represented—the story could be repeated again and again all over the city.All three were considered by the Health Department to be unfit—which means, in money terms, worthless. The market value of an unfit house is nil; for it cannot be lived in, by law. All three were owner-occupied.With No. 18 there was no problem for the owner, for by a peculiar quirk of law he qualified for what is known in local government language as an owner-occupier's supplement'.This paid him the difference between site value of his house, which he would receive anyway, and market value. In other words he got full compensation, amounting to some £1,200.The condition of the house—the vital issue in the cages of 51 and 77 Stamford Street— made no difference. He qualified for full compensation because he bought his house between 1st September, 1939, and 13th December, 1955, and had lived in it for fewer than 15 years.The owners of both the other houses appealed against the designation of their property by the Medical Officer of Health as 'unfit'–51 successfully, 77 unsuccessfully.Both were marginal cases; the official report on each listed much the same defects as the other. Both, for instance, were said to suffer from rising and penetrating damp, both were poorly lit inside, and both were said to have inadequate facilities for the storage of food and disposal of waste water.Indeed, No. 51 which was reclassified on appeal as 'fit', had more defects listed against it than No. 77.After hearing the evidence at a public inquiry, the Ministry of Housing and Local Government inspector decided that No. 51 was not 'so far defective as to be unfit', whereas No. 77 was, although he conceded that it had been well looked after.So, No. 51 was eventually bought by Portsmouth Corporation for its full market value of £1,600, whereas the owner of No. 77—who did not qualify for the owner-occupier's supplement—received just £230 for the land on which the house stood, with £232 compensation in the form of a 'well maintained payment', an amount calculated as four times the rateable value. It is quite clear that the dividing line between fit and unfit, and between eligibility and non-eligibility for owner-occupier supplement is too rigid, and in Portsmouth, in particular, the gap is too wide. If we look at the way in which an authority, backed by the Ministry's inspectors, comes to its decision, we see that it is still dependent on subjective interpretation. It is impossible to demonstrate absolute objectivity.

The recent report of the Central Housing Advisory Committee spells all this out, and I should like to quote briefly from it. First, the report says that greater objectivity was possible than had been achieved in the past. It is easy enough to express some of the items in the present fitness standard in more objective terms, for example, by spelling out what equipment is required for the storage, preparation and cooking of food. It also says: We have also been struck by the extent to which, in the last resort, decisions must depend on the judgment of an experienced person. A further comment was: There is a need also for simple explanations for members of the public. The report came to the conclusion that the best method of obtaining greater objectivity for the purposes of applying housing standards was, while expressing the standards in fairly broad terms, to define those terms as far as possible in explanatory notes. In the City of Portsmouth there is uncertainty about the future as it affects property. This affects prices. It may even lead to an unwarranted inflation of prices in areas not immediately declared. It is unfortunate, perhaps, that the Portsmouth City Corporation has not been able to follow the lead of Newcastle-upon-Tyne in scheduling planning arrangements far ahead.

When looking for solutions to this problem, I think that there are several approaches. First, of course, there is the possibility of abolishing the present limiting dates of the owner-occupier supplement, as proposed in Clause 13 of the Bill to be promoted by the Portsmouth City Council. Another approach might be a move towards sliding scales, with a more generous well maintained payment.

Whatever the solution is, it is certain that something must be done, and done urgently. For if we look at the situation we see that the purpose of the Housing Act is to deal with the quality of life for large numbers of people in Britain, and if we are concerned with the quality of life of people in Britain, we must be concerned about the psychological and social problems which affect people who find themselves faced with the problem of large-scale redevelopment, and find themselves losing the security to which they have been looking forward for many years.

I think that we must all agree that a Government which is so obviously concerned with introducing adequate and proper housing for this half of the twentieth century must also look at the corollary, which is to make sure that the way in which this is done does not detract from the effects which will subsequently be enjoyed

11.13 p.m

Photo of Mr Graham Page Mr Graham Page , Crosby

I shall detain the House for only a moment or two. The hon. Member for Portsmouth, West (Mr. Judd) has called attention to an injustice which is becoming more and more known to the public. A householder who paid £1,000 for his house three or four years ago may be offered £30 if it is in a clearance or redevelop- ment area. A householder who has paid perhaps £1,400 by way of mortgage for a period of 25 years is now offered gross value of £30 for his house if he happens to be in a redevelopment area, and a tenant who has spent perhaps £300 or £400 on improving the house is offered nothing.

Local authorities are revolting against this at the present time, and the hon. Gentleman has shown that Portsmouth has come forward with a sort of banner of justice in its Bill to the House. The problem which faces the Government is that many local authorities will not carry out the terms of the law as it stands because they think that it is such an injustice on their citizens. They think that it is an injustice to sacrifice their citizens to this confiscation in the name of progress.

I think that we will find difficulty in getting local authorities to proceed with redevelopment areas when they consider that there is such an injustice on their citizens

11.15 p.m

Photo of Mr Robert Mellish Mr Robert Mellish , Bermondsey

My hon. Friend the Member for Portsmouth, West (Mr. Judd) has raised an issue about which I know he feels very deeply. It is, moreover, an issue which is causing concern to many citizens of Portsmouth and to large numbers of owner-occupiers elsewhere in the country. I would go so far as to say that the situation we find in Portsmouth represents in a dramatic form conditions to be found where local authorities have succeeded in clearing the worst of their unfit houses and are now turning their attention to areas where the stark gap between fit and unfit houses is no longer so obvious as it unfortunately was in the past.

My hon. Friend is well aware of the sympathy that my right hon. Friend has for those who may at present suffer hardship through the operations of slum clearance. The answer that he gave to my hon. Friend on 6th December last, when he indicated that this is one of the many problems relating to older houses which are under review, is evidence of that.

My right hon. Friend is well aware from his visit to Portsmouth last year of the conditions and feelings there, and he has studied the memorandum that was submitted to him during his visit on behalf of the Owner-Occupiers' Protection Association. Further, my hon. Friend has more than once written to me in cogent terms of the problems faced by owner-occupiers whose houses may be caught up by clearance operations and I hope sincerely that my replies have done their part in convincing him and his people that the Government take these problems very seriously indeed.

If I went beyond that on this occasion and said exactly what the Government intend to do I might well swiftly be called to order, for I should be embarking upon a discussion of possible amendment to existing legislation. That is what the review which my right hon. Friend mentioned is all about and, in any case, at this stage of the review I could give no precise undertakings. So I know my hon. Friend will understand if I concentrate upon the administration of existing Statutes, recognising problems but at the same time indicating how their effects have been already mitigated or can be offset short of legislation.

Photo of Mr Harold Gurden Mr Harold Gurden , Birmingham, Selly Oak

I am interested in what the Minister is saying. Has he overlooked the fact that I have brought in a Bill to clear away this injustice a long time ago and that he and his colleagues rejected it?

Photo of Mr Robert Mellish Mr Robert Mellish , Bermondsey

Any legislation we introduce will be concerned not only with this one item. There must be a broad approach to this problem. I am quite prepared—as I know my right hon. Friend is—to discuss this matter with the hon. Member, and with the hon. Member for Crosby (Mr. Graham Page) and others, to try to resolve it. I do not deny that there is still some injustice, which must be put right. The question is how and when we should do it, but for goodness sake let us introduce legislation which is agreed on both sides and which will stand for some time, rather than the patchwork quilt that we have had in the past.

On the basis of returns made by local authorities in 1965, the numbers of unfit houses remaining to be dealt with in England and Wales still total about three-quarters of a million, despite the fact that over 700,000 slums have been demolished or closed since the war. Of course, the remaining unfit houses are not spread evenly over the country and half of them are to be found within the area of 24 authorities. It may surprise the House to learn that Portsmouth is one of those 24 authorities

It is true that its figure of 5,500 does not compare with Liverpool's 74,000, or Manchester's 55,000. But there should be no denying that Portsmouth has a real and significant problem that must be tackled as quickly and effectively as possible. As I mentioned right at the beginning of my remarks, the worst conditions in Portsmouth have perhaps been swept away with the clearance of 3,800 unfit houses since 1955 but, as 14,000 of the 65,000 dwellings in the city are over 100 years old, I can well appreciate the reasons that have led to a new clearance programme involving some 4,800 houses.

Naturally, I cannot pronounce on the fitness or unfitness of individual houses in any general programme. That is something that must be determined by a very careful procedure and I hope the House will forgive me if I think it is worth while spending a few minutes describing it for the benefit of those who read my speech in the local Press. If a local authority is satisfied that the dwellings in an area are unfit for human habitation, by standards set down in Section 4 of the Housing Act, 1957, and that they should be demolished, the authority must declare a clearance area.

It must then take the next step towards getting the houses demolished by making either a clearance order or a compulsory purchase order. By the former, the owners of the houses are required to carry out the demolition but are left with the land; under the latter the authority acquire and then demolish the houses.

But in neither case can the authority act simply on the strength of its own order: that decision is for the Minister to take after a public local inquiry, held by one of his inspectors, at which objections are heard. An owner may object to a clearance order or a compulsory purchase order on the grounds that his house is not unfit. He may, of course, object to compulsory purchase, whether or not he accepts that his house is unfit. The Minister reaches his decision only after very careful consideration of his inspector's findings and recommendations, and he may confirm the order with or without modification, or reject it completely.

There is one further matter that I should like to mention in connection with a compulsory purchase order whose prime purpose is to clear unfit houses. It is this: fit property may be included in the order, by virtue of Section 43 of the 1957 Act, when its acquisition is reasonably necessary for the satisfactory development of the cleared area.

Here I pause, before I turn to compensation payable upon clearance, and make a basic point about the powers and duties of local authorities faced with unfit houses in their areas. When seeking to develop or redevelop parts of their areas authorities may have a choice of statutory powers available to them depending upon the purpose they have in mind. They may indeed find a combination of powers appropriate. But their freedom of choice when dealing with what, in their view, are areas of unfit houses is much more restricted.

It is, I hope, clear from what I have already said that the Housing Act of 1957 imposes a duty upon authorities to deal with areas of unfit houses. Not only that: it tells them how they should set about doing it in the ways I have described. For all practical purposes, there is a strong obligation upon an authority to make use of the provisions of the Housing Act and, in particular, those provisions in Part III of the Act, where they are satisfied that the area is one of unfit houses which should be demolished. The clearance of the houses is in fact the first objective of their action.

Of course, the local authority's initial judgment about the condition of the houses may be wrong. Indeed, it may have formed its view with considerable caution, having regard to the worse conditions of houses declared unfit and cleared in the past, but yet have come to the conclusion that the houses were unfit. I will not speculate on considerations of that sort, in case I appear to be anticipating in any way a formal decision of the Minister in respect of a particular order.

But the point is that the grounds of the authority's action will be tested by the due processes leading up to the Minister's decision. In the circumstances of the case, he may uphold the authority or, in effect, indicate that the conditions in an area are not such that they justify clearance on their own account. Then the authority must look to other powers in tune with the purposes it has in mind for the area; those powers may be available in the Housing Acts or the Town and Country Planning Acts, or elsewhere.

I can appreciate that owners of houses affected by clearance operations may see more clearly the proposals for the redevelopment of an area than its existing conditions. Necessarily, clearance usually implies redevelopment of one sort or another consistent with the future character of the neighbourhood, and clearance operations may, as I have said, incidentally take in fit property reasonably necessary for satisfactory redevelopment.

But—and I make no apologies for repeating this point—the test of the authority's action is the condition of the houses in the area. I can assure my hon. Friend and the House that this is the test which the present Minister stringently applies.

The level of compensation payable upon compulsory acquisition also follows as a general principle from the condition of the houses within the order. This rule has been applied since 1919. Where a house has been found unfit for human habitation, compensation is limited to the value of the site upon which it stands. The justification for this rule, essentially, is that public money should not be payable in respect of bricks and mortar that have been condemned and should be cleared as soon as possible. Successive Governments have upheld this philosophy and it would be quite wrong for me to suggest that the present Government were prepared to abandon it.

Nevertheless, over the years, the basic proposition of site value compensation for unfit houses has been modified to meet changing circumstances and the acquisition of fit houses is compensated at full market value. There are two major modifications of the site value rule that I want to deal with and each is of especial concern to owner-occupiers who, as my hon. Friend has made clear, make up such a large proportion of Portsmouth's population.

My understanding—from his expert knowledge, my hon. Friend will know about this—is that between 40 and 50 per cent. of the city's houses are owner-occupied and that many of these are to be found in areas where redevelopment is probably not that far off. Moreover, older people tend to live in and own these houses, and this is an additional reason why we should take the greatest possible care to avoid incidental hardship wherever possible.

Payments in addition to site value are made where unfit houses have been well maintained, despite their inherent defects. This prevision dates from 1935, and payments now amount to at least four times the rateable value of the house for owner-occupiers and, in other cases, at least twice the rateable value. They may be more where the local authority is satisfied that a greater sum has been spent on maintenance during the preceding five years. In any case, they are payable to whoever is responsible for the work. About £1 million annually is paid out by local authorities in respect of well-maintained payments in, perhaps, 12,000 cases.

Photo of Mr Graham Page Mr Graham Page , Crosby

On the question of well-maintained payments, will the hon. Gentleman ask his right hon. Friend to consider this? The victims do not understand what is meant by well-maintained payments. Could the local authorities recommend to the Minister which houses ought to have well-maintained payments, or, alternatively, could the Minister's inspector inspect all the houses, not just those in respect of which people have claimed the well-maintained payment?

Photo of Mr Robert Mellish Mr Robert Mellish , Bermondsey

That is a fair point. I give the hon. Gentleman the assurance that I shall take it back to my right hon. Friend—I shall not take up the time of the House now—to see whether we can apply such instructions.

There is no reason why it should not be done. Where clearance orders are made, and a great number of houses are, in fact, in fit condition, but they happen to be unlucky enough—if that is the right word—to be involved in a re- development area, we ought to fall over backwards to make sure not only that those houses are given fair compensation but that well-maintained payments are given. There should be a careful test to see how generous we can be in these cases. I do not quarrel with the hon. Gentleman about that.

I had referred to the well-maintained payments, and I was coming to the next point. The most significant modification of the site value rule that has so far been made, however—it is important to say this—is the supplemental payments to owner-occupiers who bought their houses between 1st September, 1939, and 12th December, 1955, while slum clearance was in abeyance. In those cases, the payments bring compensation up to the full market value as if the house had not been found unfit.

The statutory provisions were due to expire in December 1965, but they were continued by the Housing (Slum Clearance Compensation) Act, 1965, for qualifying owner-occupiers who have not had 15 years' possession of their houses. Recently, these supplementary payments have amounted to £3 million a year and are being made in about 6,500 cases. So, with payments for good maintenance, getting on for one-third of all cases receive more than site value today. This should help to dispel the idea that the Government, with the connivance of the local authorities, go out of their way to pay only the minimum.

It could well be argued, and it has been argued, that the degree and extent of these modifications to the site value rule serve only to demonstrate that the good is the enemy of the best. Payments in respect of good maintenance frequently do comparatively little to bridge the gap between site and full market value, although the quality of the house has gone some way towards bridging the gap between the old-style slum and fitness.

Again, the supplemental payments to owner-occupiers do not extend to all owner-occupiers and only to those who otherwise qualify if they have had their houses for less than 15 years. Portsmouth Council has in mind its own legislative proposals to remove some at least of those restrictions upon the entitlement of owner-occupiers to full market value, but the House will understand if I do not comment on that. All I can say now is that those people, whether owneroccupiers or others, who have lavished care and affection upon their houses and have turned them into comfortable homes for the time being, despite their inherent defects, merit our care and encouragement.

I understand and appreciate the points made by my hon. Friend, and by hon. Members opposite, too, who, with no party bias on this question, merely want to see that justice is done. I have listened with great interest to what my hon. Friend has said. I respect him for being a first-class constituency Member who feels these things personally and deeply. I assure him that the points he has raised will be given the fullest consideration in our review of these problems relating to older houses.

I further assure my hon. Friend that, in the meantime, my right hon. Friend will continue to administer the existing legislation dealing with the clearance of houses with the strictest regard for hardship that might inadvertently be caused

Question put and agreed to

Adjourned accordingly at half-past Eleven o'clock