Orders of the Day — Housing Corporation (Advances)

Part of the debate – in the House of Commons at 12:00 am on 26th March 1969.

Alert me about debates like this

Photo of Mr James MacColl Mr James MacColl , Widnes 12:00 am, 26th March 1969

This has been a short debate participated in by few hon. Members, but it has shown one of the great values of the House of Commons in discussing a subject which is so specialised and abstruse. I and my Ministry have had a battering from hon. Members of widely differing political views with widely differing approaches to the problem. But all those who concerned themselves with this subject knew what they were talking about, and the cumulative effect of what they said is of great value.

I express appreciation to those running the Housing Corporation. Some of the criticisms which have been made of them have not been well founded. They have a difficult job to do. The Board of the Corporation is a strong Board and its members are widely experienced and are in a position to talk with authority about what they are doing. They do not always agree with the Government, and the Government do not always agree with them—it would be very odd if they did—but we all recognise that we are trying to do the same job. Each individual housing society consists of people who devote themselves to this work and who, as a result, develop very strong views on what they think should be done, in the same way as the hon. Member for Ormskirk (Sir D. Glover). That is right and I do not quarrel with it.

The debate has revealed a fundamental difference of approach to the problem of what the housing societies are trying to do, and of what kind of control ought to be imposed upon them. My hon. Friend the Member for Norwood (Mr. John Fraser) saw housing societies as being Socialist in conception. He thought that co-ownership was a good, democratic, Socialist method of providing houses and should be regarded as an essential part of the public sector so that public money increasingly took over responsibility. He and my hon. Friend the Member for Bristol, North-East (Mr. Dobson) were impatient with the two-thirds and one-third proportion. They thought that there should be increasing public responsibility and increasing use of public resources.

On the other hand, the hon. Member for Crosby (Mr. Graham Page) said that he regarded housing societies as doing a normal commercial transaction for the provision of middle-class dwellings. I am not making a debating point and playing one off against the other. This is the dilemma which we must face.

If we are regarding this as a normal commercial transaction for people who can be expected to pay their own way and who do not want and would not expect a public subsidy, then public participation in the financing of the body should be minimal. It should be just a pump-priming job. If, on the other hand, it is to be regarded as comparable with a housing association, which has authorised arangements with local authorities, or with the provision of council houses, then it must come within public sector investment and be looked at from the point of view of what can be afforded in the way of investment in the public sector.

My hon. Friend the Member for Bristol, North-East gave this as a ground for giving them independence. He said that we should not be tottering from financial crisis to financial crisis. We all agree with this, but the whole point of his argument about the Government's policy in this matter and in other matters is that unless we control public investment, unless we limit it rigidly, unless we are clear in our minds on how it should be allocated, then we shall totter from financial crisis to financial crisis. If we want to use the Housing Corporation to maximum effectiveness we must achieve greater private participation through building societies and other bodies in the provision of cost-rent and co-ownership houses for the minimum expenditure of public money.

I was asked whether there was joint operation with the Land Commission for the use of Crownhold land as a land bank. There is nothing to prevent the Corporation from being in close touch with the Land Commission; it is quite free to do so. It is a matter for those bodies to work out how they can best work together in partnership. The Housing Corporation was set up primarily to supervise the lending of public money, to see that it was used economically and to exercise strict control over the manner in which it was used.

The views of the House on the district valuer are most valuable. The district valuer is the custodian of public economy and the use of public funds and he therefore has his responsibilities. I will draw the attention of my right hon. Friend to this point.

There have been two main charges against the Government. The first is that they are keeping down the amount of money advanced to between £8 million and £9 million a year. This is not a limit on the number of houses but on the amount of money which is available. That means that if the Corporation can get more than the two-thirds from outside sources, they will be able to provide more houses. I am sure that, when my hon. Friends think about this carefully, they will see the point. We cannot have a tough policy on keeping down loans and keeping down investment in the public sector and other sections of housing while saying at the same time that we shall give a blank cheque to the Housing Corporation to draw all the money that it wants. That is a straightforward way of getting into a financial crisis, and it is not just.

The second point made referred to the ceiling of £5,000 a unit, although nothing beyond that was forbidden, provided that it had my right hon. Friend's approval. In fact, the figures are £5,000 in the provinces, £6,000 in the South-East Planning Area, and £7,000 in Greater London. My right hon. Friend felt bound to place this ceiling on the activities of the Corporation because of the feeling that the object of the Corporation in the use of that very scarce commodity, public investment, was not to make advances for purposes which could find the necessary finance elsewhere. The object was to provide accommodation at moderate and reasonable rents, rather than expensive luxury property for which there was already a fairly easy market and for which there were other means of providing the necessary finance. If one is doing a commercial job in providing middle-class dwellings for middle-class people, normally they should be able to pay the cost. When one is seeking finance above a certain level, the question arises whether it is proper to use Housing Corporation funds for it. I have seen some cases in which I thought that there could be no argument for using public money in this way.

If, as we have been told, it is so important to keep down rents, we must also keep down costs. It is no use allowing a housing society to buy expensive land in the middle of a high-rent area in order to build accommodation if the resulting rents are beyond the purses of those for whom it is intended. Some regard must be had to the rent and, therefore, it is very important not to allow the developments which are taking place to get out of reasonable balance.