Orders of the Day — Housing (White Paper)

– in the House of Commons at 12:00 am on 19th July 1971.

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5.30 p.m.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I beg to move, That this House approves the White Paper "Fair Deal for Housing" (Command Paper No. 4728). Certainly both sides of the House and both major political parties since the war have endeavoured in different ways to tackle the country's housing problem. It has been a feature of a number of elections that housing has been one of the major topics propounded by the various political parties. I do not doubt for one moment the sincerity of hon. Members opposite in endeavouring to tackle the housing problem facing the country. Their Government set forth with the most ambitious programme for house building of any post-war or, indeed, pre-war Government, and at the end of their period of government they had to confess that they had reached a position where there was a general decline in the housing conditions in this country.

The White Paper that we are discussing today is a result of our analysis of the total problem that existed when we took office in June of last year and an attempt to tackle it in a constructive way. The position that we inherited last June was, beyond doubt, very serious. In the public sector a very real decline was taking place. It has been suggested by the Opposition that the reason for this was the political views of local councils. The official view as published by the then Minister of Housing and Local Government appeared in the annual report of his Department as follows : Following devaluation the Government decided in 1968 to make reductions in the public authority house-building programme below the level previously planned. Therefore, there was a positive decision by the Labour Government following devalution to cut back their previous proposals.

When we came into office the slum clearance programme was also in decline. The rent system in this country, whatever afterwards may have been propounded for it, nobody could possibly have defended as fair. It was unfair. There were plenty of people who needed much more help but who were not receiving it. The level of a council house rent in the public sector was very much a matter of chance as to the locality in which one lived rather than the needs of one's own family or one's own housing need. As to the direct assistance to the individual, 40 per cent. of local authorities had no rebate scheme at all. There was a private sector with no rebate scheme at all, and as to the 60 per cent. of local authorities who operated a rebate scheme, many of those rebate schemes were thoroughly inadequate.

We had a system of housing subsidies in which only £1 in £10 was being spent on the direct reduction of rents of those people who needed help. The voluntary housing movement, encouraged in theory by both sides of the House, was facing a major crisis and was in decline. In the private sector we had a situation in which 1¼ million houses were rent controlled, their rent levels having been fixed 14 years previously, in 1957, and any objective person would have recognised that those houses were likely to deteriorate into slums as the months went by. Another 1¼ million tenants in the private sector paid fair rents as defined by the previous Labour Government but with no rebate scheme at all.

As to owner-occupation, there was an even steeper decline in the number of starts. In addition, S.E.T., betterment levy and other matters had handicapped owner-occupation. The building societies were short of money and the prospects for the building industry in the private sector were very grave indeed. This was a grave disappointment to hon. Members opposite. The right hon. Member for Bermondsey (Mr. Mellish), whose passion on the housing front I respect, as we all do, summed up the feeling of his own Party when, in an article in the New Statesman after the General Election, he wrote : As one of the politicians involved, I admit to being thoroughly ashamed that my term of office did not produce anything like the approach that is needed to solve the problem of housing. In those few days and weeks when he was Minister of Housing he intimated that he himself intended to change the whole basis of housing policy if he were allowed to do so. I state this proposition not to make party points but to show that we inherited a position that was extremely serious, that a Government dedicated to housing the people in a better way, after six years in office, had reached a situation where the position in the public sector, the voluntary housing sector and the private sector, to rent and for owner-occupation, was bleak and bad.

Photo of Mr Robert Mellish Mr Robert Mellish , Bermondsey

I am obliged to the right hon. Gentleman for the courtesy with which he quoted what I said. I think he will accept that from 1964 till the period of devaluation the Labour Government had the finest housing record ever known in the history of this country.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I am not denying that the intentions with which the Labour Government set out were honourable. But they inherited a fast-rising programme, unlike the present Government who inherited a fast-declining one.

Photo of Mr Robert Mellish Mr Robert Mellish , Bermondsey

With great respect, on the public sector we had to spend the first nine or 10 months doing nothing else but beg local authorities to get under way and improve their programmes.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I refer back to the quotation from the right hon. Gentleman after the General Election, that he was one of the politicians involved who were ashamed that his term of office did not produce anything like an approach which was needed to solve the problem. As someone who witnessed on television the Labour Party conference debate on housing after the election—because, of course, I was not invited to the conference—I can say that there was no doubt that there was widespread disappointment throughout the Labour Party at what happened. Therefore, this White Paper endeavours to put forward proposals to change the situation.

As to the public sector, we intend to see that rents go over to a fair rent basis as defined by the Labour Party's own definition of fair rents in the Rent Act, 1965.

Photo of Mr Clinton Davis Mr Clinton Davis , Hackney Central

Mr. Clinton Davis (Hackney, Central) rose——

Photo of Mr Peter Walker Mr Peter Walker , Worcester

No, I am not giving way. Many hon. Members wish to speak. I normally give way, but if I were to do so it might prevent others from speaking.

On the matter of fair rents we have decided to choose this definition and to apply it in the public and private sectors. This will mean that for the first time we shall have a situation of much greater fairness throughout the country. It will not be a matter of luck or chance depending on when a council built the main part of its stock of council houses. It is a policy which will not adversely affect the worst areas, as so frequently the present council house rent policy does. There are many inner London boroughs which, because of the size and scale of housing programmes, have discovered that no matter the extent to which they pool the historic cost of their rents, they still have to charge high rents. By having the same basis for rents we shall create a system of greater justice than before.

We have also introduced into the White Paper specific incentives and a new basis of accelerating slum clearance. I think I can say that in the negotiations which the Minister for Housing and Construction had—there were very detailed negotiations with the local authorities—all sections of local authorities were agreed that the change that will take place in the subsidies for slum clearance will remove some of the considerable financial handicaps which were imposed upon local authorities previously. There is no doubt that this clear-cut system of subsidising slum clearance and meeting the entire cost of slum clearance will enable a vastly accelerated programme to get under way.

The national rebate scheme which we propose to introduce has been criticised by some hon. Members opposite as introducing another means test, and they have argued that, as it will apply the means test over the wide field of council house tenants and private tenants, it is bad. In this connection, I remind the House of what was said by the hon. Member for Willesden, East (Mr. Freeson), formerly a Parliamentary Secretary to the Ministry of Housing and Local Government and one who often takes a leading part—I understand that he is to wind up the debate tonight—on housing matters. This is what the hon. Gentleman said at Question Time shortly after the General Election, implying pretty distinctly that a Labour Government would themselves have done exactly the same : In pursuit of that objective, which has been mentioned a great deal by hon. Members opposite, will the hon. Gentleman and the Minister consider pursuing the consideration which the previous Administration gave, as part of their reconsideration of housing finance, to a national rebate scheme to apply to people in private accommodation as well as public? "—[OFFICIAI. REPORT, 14th July. 1970 ; Vol. 808, c. 1347–8.] It is reasonable to interpret that as a strong indication that this was a fairly firm thought in the Labour Government's mind, and, presumably, as the hon. Gentleman put it forward then, it was a thought which he found attractive as a possible means of dealing with this problem.

Photo of Mr Reginald Freeson Mr Reginald Freeson , Willesden East

It was not the last Government's intention to introduce what is, in effect, a market system for rents in local authority housing. That is the big difference between the situation then and now.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I assume from that interjection by the former Minister that, although he disagrees with us on the fair rent basis, the previous Government had in mind a national rebate scheme. This is the point which I am making. Those hon. Members opposite who object to a national rebate scheme as a mass means test should remember that there was a fairly clear indication that the previous Government had a national rebate scheme well under consideration.

It is an interesting fact that, in all the commentary on our White Paper since its publication last week, it has been dealt with by many of the journals particularly interested in this topic and it has been dealt with by many observers working socially in this sphere—I know of only one detailed criticism of the rebate scheme, I know of no one who has suggested that it is not generous, and I know of no one who suggests that it will not be of real help to people on lower incomes. The only detailed criticism which has been made is that, perhaps, it treats single-parent families more unreasonably than previous rebate schemes. This is certainly a matter which we shall look at.

Our scheme will for the first time give the chance of a rent allowance to 2½ million people in the private sector who had no chance of a rebate under the previous Government, it will ensure that the fair rent policy in the public sector is accompanied by a rebate scheme which is generous, and it will concentrate help where it is needed most.

I come to the effect of our proposals on the voluntary housing movement. My right hon. Friend the Minister for Housing and Construction can fairly claim to have had more detailed talks and negotiations with this movement than any previous Minister had. He has carefully considered the many points, facets and difficulties of the movement. The powers which we shall take in our legislation to see that, where necessary, 90 per cent. of any deficit is met for the first three years—that period can be extended, if necessary—will mean that the movement can get under way in a far more effective and well-organised fashion than has ever been possible before. It is our intention that the legislation should serve that purpose. I know that the National Federation of Housing Societies, perhaps the most important collective body in this connection, is grateful for the way in which my right hon. Friend considered in great detail the various points and problems which it put to him.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I will not give way now. I am trying to be brief, in view of the pressure of time.

As regards private sector rents, we are moving the 1¼ million people who are now in the controlled sector over to the fair rent system. I thought that the hon. Member for Salford, East (Mr. Frank Allaun), taking his traditional line in his letter to The Guardian today, and saying how terrible it was——

Photo of Mr Peter Walker Mr Peter Walker , Worcester

The hon. Gentleman says that, but it was the declared policy of the Labour Government when they introduced their Rent Act in 1965—this was made perfectly clear by the then Minister of Housing and Local Government—that all of them would eventually be moved over to the fair rent system. This is no new policy which we are announcing. It was the declared policy of the previous Government in introducing the Rent Act, 1965.

I believe that the hon. Member for Salford, East in his comments in The Guardian this morning is misleading the public—obviously, not intentionally—when he suggests that there will be massive increase in rents for very bad slum properties. Any study of the rent assessments made under the fair rent system will show that that is just not so. It may well be that some of the worst slum properties on controlled rents will have lower rents fixed under the fair rent system than prevail under the controlled rent system now. There are examples of very low rents—sums of 10p or 12½p and the like—being fixed for very bad properties, and I am sure that that will be the case.

Can anyone defend a system under which rents for these houses are to be kept at the levels imposed—and then not very generous levels—in 1957, 14 years ago? Without doubt, this policy has resulted in more houses falling into bad condition than has almost any other policy. The Milner Holland Report shows what is the ownership of these properties. They are not owned by the large landlords. Milner Holland pointed out that in London 60 per cent. of the rented properties are owned by people who own only one such property, and 40 per cent. of those people are old-age pensioners. To argue that these are the people who should subsidise and support the maintenance of buildings kept at the artificially low levels of 1957 is to argue a case which cannot be objectively supported by those who wish to see an improvement of housing conditions in this country.

Photo of Mr Frank Allaun Mr Frank Allaun , Salford East

To help these people and the poor council tenants the Minister is introducing a rebate scheme under which application will have to be made. His scheme is based on the assumption that everyone is ready to hold his hand out. This is just not true. There are masses of poor people who are too proud to apply. Under the existing rent rebate schemes, very few apply compared with the number entitled. Under the family income supplement scheme, only one in four of those whom the Government expected to apply have in fact applied, and the same will happen under the Minister's rebate scheme.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

The previous Government sent out a circular urging that the subsidies should be used on rebate schemes. This was then their policy. One major difference which we shall pursue is that, in order to ensure that there is the fullest possible take-up of our rebate scheme, the details and the method will go in every rent book in the country. That will make a considerable difference.

I come to the difficult question of furnished tenancies. I can well understand the feeling that this is an area of poverty and difficulty which the measures announced in the White Paper do not reach. But I must in fairness point out that at no time during the six years of the Labour Government was there any move whatever to do anything about this sector. I do not believe that that was so because right hon. and hon. Members opposite did not care about people in these dwellings ; it was so because they realised that there were very real difficulties in doing something about it.

There appears to be a suggestion in certain commentaries that it is easy and that one should do exactly the same for furnished tenancies as though there were no difficult problems and consequences. I do not believe that the Labour Party would ever advocate—certainly, when it had a policy committee looking into the question it did not advocate it—that the two out of five persons in furnished tenancies where the houses are lived in by the owner also should have security of tenure imposed. I have never heard any responsible member of the Leadership of the Labour Party suggest that. This affects two-fifths of them. Before the Election, the Labour Party did not make its position clear.

The reason is a genuine doubt about the adverse effect that any move in that direction might have on the supply of this type of accommodation. We have published the White Paper. I shall be interested to hear constructive suggestions about how we can tackle this problem in a way which is practicable and feasible and which will not result in a great reduction of the available accommodation. My predecessors did not find this an easy one to tackle, otherwise I am sure the Labour Government would have endeavoured to do so. When the right hon. Member for Coventry, East (Mr. Crossman) introduced his 1965 Housing Act, he found it an impossible problem to tackle. Before that, referring to a quotation often used by my right hon. Friend the Minister for Housing and Construction, when the late Mr. Aneurin Bevan was the Minister responsible he firmly rejected a proposal to do it. This is not a case of a group of reactionary people not wanting to help. Various Governments have concluded that the practical difficulties involved are too great.

I want to see that the rights of tenants are more known to them than in the past. We shall see to it in the legislation that the rent book is used in a more positive way in order to bring a tenant's rights to his attention. We shall increase the penalties for victimisation of tenants and, for the first time in history, we shall be providing tenants with a generous rent rebate scheme. In combination, this is a better total deal for people in that sector than ever before.

Turning to owner-occupation, which is one of our aims, the White Paper details our measures designed to provide a stimulus : the abolition of the betterment levy and the Land Commission, halving S.E.T., giving freedom to local authorities to sell council houses, doing away with stamp duty on mortgage deeds, coming to arrangements with building societies to give better facilities for those without capital but with reasonable incomes, making changes in the option mortgage scheme, the very important measure giving almost unlimited amounts of money for use by councils for local authority mortgages, the quite important measure arranging for the movement of people from the public to the private sector, so releasing greatly needed accommodation for others, and arranging with housing authorities to help with removal expenses and legal expenses. Here are eight policies of this Government which have resulted in an increase in starts in the last few months, and we have encouraged owner-occupation in these ways.

This is a White Paper which tries to see that in the public sector a fair rent system is applied with a proper rebate scheme. Under this policy, housing subsidies as they exist at present are not used indiscriminately but as a positive help to those who need it. These are proposals which in the private sector bring to 2½ million people for the first time a proper rent allowance scheme, which end the nonsense of controlling rents artificially at ridiculously low figures which only result in houses turning into slums. They give stimulation to the voluntary housing movement, and, as part of the total package, they continue positively to encourage owner-occupation.

The reception of these proposals must be of interest. The Daily Express described them as … the wisest reform of housing this century. The Daily Mail said : It's fair and bold. The Daily Telegraph and The Times referred to this as a good White Paper, and generally praised its proposals. The Economist summed up the White Paper by saying : The immediate effect of these reforms, once legislation, to be introduced in the autumn, has been passed, should be a boost for council building in many places where this will still be the best means of housing poorer people. It should reduce the decay of older houses ; push some richer council tenants out into owner occupation ; radically alter the relationship between councils and their tenants and would-be tenants ; and eventually it may change many of the social distinctions which have grown up between the different sectors of housing. It is an overdue reform. What must be even more interesting to hon. Gentlemen opposite is the general reception of these proposals elsewhere. For example, New Society, which cannot be described as not being reasonably objective on these problems, referred to these proposals and said : This is, in fact, the first entirely logical approach to housing finance. As for the Sun newspaper, which is not a Right-wing paper either——

Photo of Mr Peter Walker Mr Peter Walker , Worcester

Perhaps it is objective. Its editorial used the following words : We have mucked about with the problem for too long. We have had controls that kept rents too low to pay for repairs. Or we have scrapped controls and priced people out on to the streets. We have built council houses for the under-privileged—and made a special privileged class of their tenants. The Tories have a plan for ending the unfairness. They want to shift subsidies from properties to people, even if that does involve means tests. From each according to his ability : to each according to his need. In its editorial yesterday, the Observer said : The basic principle underlying the Government's 'fair deal' for housing deserves a warm welcome. … The result should mean less waste, more fairness, and better care of the nation's stock of property. I am aware that the right hon. Member for Grimsby (Mr. Crosland) is not keen on anyone quoting from the New Statesman. Previously, the right hon. Gentleman has commented on the quality and manner of its observations. For that reason, it must have been a relief to the right hon. Gentleman to find that the New Statesman's comment this time was not written by his right hon. Friend the Member for Coventry, East but by a former colleague of his, much respected in the House when he was here, Mr. Christopher Price. The following is his general summary of a view on the White Paper which the Labour Party described as "reactionary". Mr. Price writes : Mr. Walker's White Paper which abolishes existing housing subsidies and introduces a national rent rebate scheme is a serious effort to solve three problems which Labour failed to tackle between 1964 and 1970. First, it attempts to clear up the chaotic jungle of existing subsidies ; secondly, it tries to provide a system of helping all those who need rebate, whether they rent their house from the local council or a private landlord, and thirdly, it is designed to concentrate housing subsidies on slum clearance. Those are the comments of Mr. Christopher Price——

Photo of Dennis Skinner Dennis Skinner , Bolsover

That is why he cannot get : back here.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I shall, with pleasure. Apparently the right hon. Member for Coventry, East gives his editorial approval. It goes on : The Opposition should accept the fact that the scheme faces up to the basic problems they themselves shirked when in office. Although it is based on the strictest Tory principles, it contains elements Labour would have been forced to introduce had they won the election. Mr. Crosland would have been in a better position to criticise Mr. Walker constructively if the Labour Party had developed a coherent policy for housing finance over the past six years. That brings me to question the position of the Labour Party. There is no doubt that, in electoral terms, right hon. and hon. Gentlemen opposite would have considerable advantage if they were able to point out to anyone whose rent had been increased as a result of our legislation what the Labour Party would have done—[Interruption.] The Labour Party would take pleasure in gaining political capital by listening sympathetically to those who complain in Tory boroughs where, as a result of our scheme, it is seen that surpluses on housing accounts are taken away to assist some of the worst areas of housing. There may be local criticism of my proposals as a result.

In an exchange with the Leader of the Opposition the other day, I made it clear that I did not know what were the Labour Party's conclusions on housing. It had been implied that I knew what right hon. and hon. Gentlemen opposite had in mind before the General Election. However, as always happens on such occasions, the officials in my Department gave me no information about the conclusions of right hon. and hon. Gentlemen opposite. I made that quite clear. But if the officials in my Department gave me no information as to what the Labour Party had in mind, leading members of the Labour Party helped me to come to the conclusion that the principles they would have followed would have been somewhat similar to my own.

In November, 1965, the right hon. Member for Coventry, East announced that the Government had not had time fully to review housing finance and that this was an urgent task. The review started in November, 1965. We heard nothing more for three years until, in January, 1968, the right hon. Member for Birmingham, Stechford (Mr. Roy Jenkins) announced : … My right hon. Friends and I are now discussing the whole question of housing finance in the public sector, and specifically whether the present housing subsidy structure makes the best use of money and resources."—[OFFICIAL REPORT, 17th January, 1968 ; Vol. 756, c. 1803.] Thus, this important review was then still continuing apace with the full support of the then Chancellor of the Exchequer. In May, 1969, the Minister of State at the Ministry of Housing and Local Government announced that an internal review of housing finance was being carried out thoroughly in his Department.

Then we got the first hint of what was to come out of this review. It was on such hints that I based my view that the principles which would be pursued by the Labour Party would not be very different from those in my White Paper. This comment was made by the noble Lord, Lord Kennet, then Parliamentary Secretary in a speech in another place : I do not claim that the housing subsidy system is perfect ; indeed, I freely admit that it is very imperfect and has been for a long time. That is why the Housing Ministers have instituted a major review of the whole of housing finances, public and private sectors alike. Mr. Crossman's suggestion about paying subsidy to people rather than on bricks and mortar has been mentioned by more than one speaker. … This is very much in the forefront of the study I have mentioned. The study is really a fundamental one. This is an enormously difficult subject. We are. within the Government, going at it 'hell for leather' at this moment and we hope shortly to come out with proposals for the largest overhaul of housing finance since the present system was instituted."—[OFFICIAL REPORT, House o1 Lords, 2nd December, 1969; Vol. 306, c. 61.] Since the election, of course, we have had comment on a national rent rebate scheme. How remarkable it is that a review started in 1965, with the Chancellor of the Exchequer showing great interest in January, 1968, and the Minister of State saying that it was well under way in May, 1969, and the Parliamentary Secretary saying that they were going for it "hell for leather" in December, 1969, did not get a glimmer of mention in the Labour Party's manifesto in June, 1970. For a party which last week put down a Motion condemning us for coming to a conclusion in nine months, that is a very remarkable position.

I am told seemingly, judging by interruptions last week, that the principles I am pursuing are different from those of the Opposition. We must ask them to make clear today where they stand. Are they in favour of a national rebate scheme or against it? Are they in favour of a national rebate scheme that applies to the private sector as well as to the public sector? Will they vote against such a scheme which brings in 2½ million people whom they left out when they were in office? Would they bring in the 40 per cent. of local authorities which did not have any rebate schemes previously?

The right hon. Member for Grimsby has referred to the freedom of the local authorities. Would he allow local authorities to pursue rent policies without any rebate scheme or would he bring in a scheme of this sort? What is his policy about the future basis of rents? Would it be fair rents in the public sector? The Opposition said that it would be fair rents in the private sector. What is the gap of discrimination they wish to have between public and private rented accommodation?

Would it be based on historic costs in England and Wales, as we propose in Scotland? If so, there would be big anomalies which would not help some of the worst areas of housing in England and Wales. What would they do about furnished tenancies? Would they change their policy, which they pursued for six years, and suggest that all these furnished tenancies, particularly those where the occupier lives in, should be rent-controlled? If they did that, many units of accommodation would be lost.

What do the Opposition suggest for more help for slum clearance? Would they change the basis and go over to subsidising people in the houses, as was suggested, by implication, by Lord Kennet in 1969? We should know the facts. The Labour Party should be clear about which system of rents they would pursue instead of just making party political advantage about anyone who gets a rent increase under our proposals.

This is not a reactionary proposal that we are bringing forward in the White Paper. It is, as many observers have said, the most radical reform of housing this century. When it comes to the crunch, whether it be in industrial relations or in housing, it is the Labour Party which is now the reactionary party. We are putting forward a scheme which will help the poor far more lavishly than the Opposition have ever dreamed of helping them. Our policy will encourage more owner-occupation. It will help to clear the slums at an ever-increasing rate. It will increase our stock of housing at a faster rate than ever before. For all these reasons, I commend the White Paper to the House.

6.6 p.m.

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby

We lost two hours from the beginning of this debate and I regret to say that we have now lost another half-hour from the time which might have been spent on serious discussion. I timed the right hon. Gentleman. Fifteen minutes of his speech were spent on the proposals in the White Paper, ten minutes on highly selective and amusing quotations from newspapers, almost all of them Tory—[Interruption.]—The Times, the Daily Telegraph, the Daily Mail, the Daily Express and The Economist—all well known Labour newspapers of course! The last ten minutes of his speech he spent, no doubt flatteringly, although this is not the purpose of the debate, trying to discuss our policy when, apparently, he still thinks he has another three years in office. Yet what the House is concerned with today is his own announced policy.

I do not suggest that the present system, now being reformed, is anything like perfect—of course it is not. There are considerable anomalies and inequities within the council house sector, between the council house sector and the private rented sector, and the distribution of subsidies is not such as to bring the most help to areas which need the help most. So I wholly agree—and this was the purpose of our review of housing finance—that the present system needs to be reformed. What we challenge is the proposals that the right hon. Gentleman is bringing forward to do so.

I begin with the central proposal, which is the proposal for so-called fair rents in the council house sector, a proposal that will affect 5½ million families, or roughly 30 per cent. of all households in the country. This is an imposition by law. Councils are to be compelled to charge fair rents. This is another far cry from the famous words we used to hear about greater freedom for local authorities.

Under the Tories, the local authorities are now not only to be deprived of the right to pay from the rates for free milk for children between 7 and 11 years of age ; they are not only being deprived, as in the case of Barnet and Surrey, of the right to go comprehensive if they so desire, despite the great stories right hon. Gentlemen opposite told about greater local freedom ; they are also losing practically all their control over their rent policies. Rent policy in effect is now to be determined in Whitehall and the local authorities are to be merely the agents of Whitehall. One of the principal housing functions of local authorities is to be taken away and they are to have virtually no discretion as to their own rent policies. This is a particularly serious matter, since local government reorganisation also due to go through this autumn will introduce a large number of new district councils with only housing as their prime responsibility. This further attack on the independence of authorities, and particularly what I said about district councils, is one of the reasons for the hostile reaction, which the right hon. Gentleman did not quote in his Press quotations, from the local government bodies which so far have spoken on the subject.

Fair rents ought to be the central feature of our debate. There are overwhelming objections to the principle of so-called fair rents in the council house sector. First, the proposal has no logic. I mention this first because Ministers, and the right hon. Gentleman did so again this afternoon, have constantly used the argument that because my right hon. Friend the Member for Coventry, East (Mr. Crossman) introduced fair rents for the private rented sector under the Rent Act, 1965, it followed as a matter of logic that they should also be applied to the public rented sector. I believe that it does not follow in the slightest degree.

Fair rents in the private sector are designed to give a landlord a reasonable profit to provide for good maintenance and improvement and to eliminate scarcity values in places like London. But there is no parallel requirement in the public sector for the obvious reason that the public sector has a large and varied stock of housing of different dates and can spread costs over its entire stock. So fair rents are not needed to provide for good maintenance and improvement. Indeed—and I shall revert to this—in many parts of the country fair rents will actually provide a large surplus on the housing revenue account far beyond what is needed for good maintenance and improvement. Therefore, the arguments about the private sector cannot be transferred by analogy to the public sector.

The difference between the two sectors was analysed by the National Board for Prices and Incomes in its report published in 1968. I quote : It would seem anomalous to relate the rents of the growing"— public sector to those of the declining"— private sector— and this anomaly would increase with the years, so that as a long-term principle the concept is likely to lose its validity. Finally, 'fair' rents so defined are not directly related to costs. We are not therefore disposed to accept this as an appropriate criterion. The Under-Secretary of State for the Environment has again and again rightly referred to the many differences between the private and public rented sectors. Therefore, my first objection is simply one of logic—that there is no logic in the proposal to apply in the public sector a basis which bears no relation to costs and no relation to the need for good maintenance and improvement.

My second objection to fair rents is basic. It is that they are wildly inflationary. At present, the level of standard unrebated rents in the council house sector is £2.25. We are never given an estimate by Ministers of what the average standard fair rents will be, but many estimates have nevertheless been made, and they do not differ greatly. The Economist this week—not quoted on this point by the right hon. Gentleman—the comments of the U.D.C.A. on the White Paper, those of the Borough Treasurer of Hemel Hempstead, and many other people have agreed that standard fair rents will be at least double the average standard rent of today.

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby

So, apparently, does the Evening Standard ; I was not aware of that.

In other words, we are to have an average increase in rent of about 100 per cent., and it will certainly be more in some areas. If new houses and flats are to be fair rented immediately, we shall find ourselves faced in London, for example, with standard rents of £10 to £12 and conceivably even more.

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby

I am worried about the lack of time ; we have already lost two hours and many hon. Members wish to speak, and I hope my hon. Friend will be among those who do speak. It would probably be better if I pushed on, and I hope that he will forgive me if I do not give way. Certainly no discourtesy is intended to him if I do not give way.

It is true that the movement to fair rents will be phased and that there is a limit of 50p a year as a maximum increase in average rents. But, even phased, it is a very drastic increase indeed in a central and particularly sensitive price the price of housing. It means in effect an increase of 25 per cent. a year until the present average rents are brought up to the level of fair rents, and in many instances after the three years have passed the fair rents will be raised still further under the procedure for a three-yearly review.

I do not know what effect the Government think this increase will have on inflation. It would be interesting to know the views of the C.B.I., now trying to persuade its members to limit price increases to 5 per cent. a year, when it discovers that the Government are deliberately increasing one of the most critical prices in the country by 25 per cent. a year.

It would be interesting to know whether the Chancellor of the Exchequer does not think that this increase will operate in the opposite direction to his announcement about purchase tax this afternoon. I believe that this huge increase in rents, incidentally coming on top of a 14 per cent. increase in rates this year, will make achievement of the Chancellor's anti-inflationary policy much harder.

My third objection concerns the rebate scheme. I think that the right hon. Gentleman was under a misapprehension about the Labour Party's worries. The worry about the new rebate scheme does not relate mainly to the principle of a national scheme—that is no doubt a matter about which people can take different views. The point of principle is that now for the first time we are to have a rebate scheme which will clearly cover the majority of tenants. Whether it is local or national, it is the coverage which matters.

We had rebate schemes under the Labour Government of course—in rents and many other directions—and the right hon. Gentleman gave a figure of 1·35 million council tenants who were means tested either for rebates or by the Supplementary Benefits Commission. But that has nothing to do with the rebate scheme which we are now discussing. We are now talking of something qualitatively entirely different, of a rebate scheme which for the first time will cover those on average earnings and higher than average earnings. The White Paper makes it plain in many of the tables that a family on £30 a week will be eligible for rebates. In other words, we shall have a situation in which means testing will be applied to a clear majority of council tenants, and I maintain that this is a totally new departure in our social policy.

It raises an issue of principle—whether it is right that standard rents should be set at a level that the worker with average earnings cannot pay without rebate. It raises an issue of practice, a point which came out in the right hon. Gentleman's speech—whether there will be a reasonable take-up of these rebates, because if there is not there will be acute hardship among many hundreds of thousands of tenants. The omens for take-up so far are not good. The numbers in the G.L.C. are extremely low so far. My hon. Friends have mentioned the extremely low take-up of the family income supplement and rent rebate schemes in different parts of the country.

I greatly hope that the right hon. Gentleman is correct in his supposition that the take-up will be adequate, but I feel strongly that we must monitor the position as the years go on. Unrebated rents are going up by so much that we shall have to monitor the position to see the effect on family household spending and to see what the take-up is year by year.

Another practical consequence will be the very large large increase in local authority staffs. Local authorities will now have to set fair rents for 5,500,000 houses. On top of that, they will have to operate a rebate scheme on a far larger scale than ever before, and on top of that they will have to administer the new private rent allowance for the private sector—the monumental task of verifying the rents with landlords and checking and making cash payments to private tenants. After all we used to hear—we hear much less now—about the drastic cuts in the size of the bureaucracy which would be made under the present Government, it will be interesting to know what increase in local authority staff will be necessary.

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

For fair rents and for family income supplements.

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby


The point has also been made—and the right hon. Gentleman did not argue it away—about incentives. It is not only rent rebates but rebates for school meals, prescription charges, dental charges, welfare milk, rate rebates, and so on. As the Government put up the charges, so the number eligible for rebates constantly increases. As many have pointed out, we are finding now, or soon will find, that large groups of workers in particular income brackets face, if their incomes rise, a loss of income at the margin of 100 per cent. First of all they lose the family income supplement. Then they pay income tax and what are now sharply graduated National Insurance contributions. Then one by one they lose their eligibility for rebates. Many calculations have been done showing that as family incomes rise from £15 to £25 a week almost the whole of the increase is lost.

My next objection—and this is a point not touched upon by the right hon. Gentleman—is to do with the social effects of fair rents on council housing. The Government are frank about what they intend. They intend that many better-off tenants should be driven out of council houses into buying their own houses, whether or not they want to. This is at a time when house prices are rising rapidly and when, as the managing director of the Freshwater Group reminded us last week, the amount of private rented accommodation is continually declining. I do not believe that this is right.

Apart from anything else, it pushes us back to the discredited concept of one class housing for the deserving poor. Until 1949 the legislation about council housing contained the phrase "the working classes". Local authorities were restricted by law to providing houses for "the working classes". This phrase was removed from legislation by Aneurin Bevan in 1949, when he was in charge of housing, in an effort to secure a better balance on our municipal housing estates.

One of the effects of the right hon. Gentleman's policy will be to push us back to the pre-war position by deliberately forcing the better paid and, frankly, the better tenant into buying his own house whether or not he wants to. I object to that.

My next objection, and this is a central feature of the White Paper which merited only a couple of minutes from the right hon. Gentleman, is that the effect of all his changes will mean a sharp redistribution of income, and generally in the wrong direction. We cannot put exact figures on this because the White Paper is almost totally devoid of figures, other than tables giving examples of income. But we can certainly tell what the general direction is. Council tenants will pay much more in rent than they do now and, as a direct consequence, the national taxpayer will save about £150 million in subsidies as compared with what would otherwise have been the case. That is the first and most obvious transfer.

Local authorities, council tenants and ratepayers will take over more and more responsibility for the relief of poverty. When the housing revenue account is in surplus, as a result of fair rents, it will be expected to meet the cost of rent rebates, including much of the cost now paid by the Supplementary Benefits Commission. When the housing revenue account is in deficit, the rates will have to meet part of the cost of paying rent rebates. After 1975 the ratepayer will also meet part of the cost—20 per cent.—of private rent allowances. This attracted no discussion in the right hon. Gentleman's speech—whether it is right that so much of the social service element in housing, so much of the burden of relieving poverty, should be borne not by central government but by the local rent and ratepayer.

In all this, largely unnoticed, and again not mentioned by the right hon. Gentleman, a new principle has been inserted. Local authority housing is now not merely not to receive a general subsidy. It is not even to be left as a nonprofit-making service, getting an adequate return on capital to cover good maintenance and improvement. Instead, over much of the country, it is to make a large profit out of rent income, of which half will go to the Exchequer. We have therefore a wholly new principle, that over substantial parts of the country the Government will for the first time make a profit out of local authoriy housing. Over large parts of the country council house tenants, far from receiving subsidies, will themselves be subsidising the taxpayer.

In other words, my council tenants in my constituency of Grimsby will pay not merely taxes—it is only right that they should pay taxes for good national purposes—but they will also pay, through their rents, for a surplus in the housing revenue account half of which will be taken by the right hon. Gentleman and used for whatever purpose he wants. This is a wholly new principle in British housing policy.

The Minister of Housing and Construction gave a Press conference on the day the White Paper was published and he said : This White Paper is in the great reforming tradition of Shaftesbury, Disraeli and Butler. The right hon. Gentleman has four heroes, it would seem—Shaftesbury, Disraeli, Butler and, of course, my right hon. Friend the Member for Coventry, East. It is a curious choice of personalities. Shaftesbury with his unbending, puritan prejudice combined with profound compassion—I can think of no present-day politician less like Shaftesbury than the right hon. Gentleman.

There may be a closer resemblance with Disraeli, whose great social reforms existed far more in fancy and fiction than ever they did in fact. Then there is Lord Butler, happily alive, whose entire life has been devoted to combating those trends in the Tory Party which the right hon. Gentleman represents. As for my right hon. Friend the Member for Coventry, East—I hesitate to say it, but perhaps there is some resemblance there, at least in their power to take one's breath away. However, more seriously, at his Press conference the right hon. Gentleman made the extraordinary remark that this was in the best traditions of the Conservative Party—" From each according to his ability to each according to his need." How anyone could use that language in good faith after the examples I have given of the redistribution of income involved in the White Paper, I cannot conceive.

The worst inequity has yet to come, and we had better face this frankly, because we seldom do and the right hon. Gentleman did not do so in his speech today. It is that we shall now have five and a half million families, council tenants, receiving no help unless means tested. Yet the owner-occupier will continue to receive mortgage tax relief without a means test, regardless of need and regardless of capacity. I fail to see how this squares with the right hon. Gentleman's quotation.

We should be more precise about this point and it ought to have more discussion in the House. The owner-occupier is now relieved of Schedule A taxation. If he is a mortgagee he receives tax relief which amounts to more in total and more per house than the present, let alone the future, level of subsidy to council house tenants. Far from being means tested or related to means this tax relief is greater the larger the income and the more costly the house. His initial payments are higher, but the real costs of his mortgage payment diminish with time as a result of inflation and, at the end of the day, he has a capital asset which has greatly increased in value and the capital gains on which are untaxed. Apart from that, he has much greater security and much greater freedom.

Meanwhile, the council house tenant—to the surprise of a lot of people, to judge from coarse propaganda that we hear—actually pays rates which will in future help to pay the private rent allowances. He will pay fair rents which will help to pay rent rebates and part of which will in future go to the Exchequer. He pays taxes without tax relief which help to provide relief for the owner-occupier. He pays rents which rise with inflation. He has no capital asset at the end and he can only receive help after a means test.

As has continually been made clear, this party is strongly in favour of owner-occupation. It was the Labour Government, not a Tory Government, which introduced the option mortgage scheme. It was the Labour Government which paid more sums in local authority mortgage payments during their years of office than the Tories did in the corresponding previous years ; I have checked the figures today, and I have them here. It was under a Labour Government that for the first time 50 per cent. of households consisted of owner-occupiers. Therefore, I need not give all the reasons why we are in favour of owner-occupation, such as that it is good for savings, good for self-reliance, gives freedom to redecorate, and so on. I welcome all the help which has been given to owner-occupiers. But surely it is then wholly inequitable to slash subsidies to council tenants in the way proposed in this White Paper.

I turn from the council house sector to the private rented sector. The Secretary of State asked for our attitude to the new private rent allowance. I strongly welcome it. The position of the private tenant has worsened both absolutely and relatively over the last few years. His rent has often risen as a result of the 1965 Act. His choice has become more limited as landlords have switched from unfurnished to furnished accommodation. Meanwhile help for both owner-occupiers and, until this White Paper, council tenants has substantially increased. It was a great injustice that the private tenant alone was receiving no help.

However, I have two reservations. First, it is quite wrong that after 1975 20 per cent. of the cost of the private rent allowance should fall on local government. This will be a rapidly rising bill because of the faster move to fair rents in the private rented sector. I believe that the relief of poverty in the private sector at least should be the responsibility of central Government and not of the local ratepayer, particularly at a moment when rates are under heavy pressure ; they rose 14 per cent. this year. The general problem of rates and local government finance is so acute that we are promised a Green Paper in the next few days.

Secondly, as the Secretary of State thought I would say, I believe it is wrong that furnished tenants are excluded from the new allowance. I do not believe it right for the Secretary of State or the Under-Secretary of State to go round the country, as the hon. Gentleman did this weekend, saying that it is too complicated and somebody else should suggest a scheme. It is the Government's job to get over administrative complications.

The furnished tenant pays the highest price per room for the worst accommodation. He has the least security and the lowest average income of any housing group. The Secretary of State said that the Labour Party had not taken a stand on the question of security of tenure for the furnished tenant. That is wrong. If he reads the evidence given to the Francis Committee, he will find official evidence given by the Labour Party in favour of security of tenure. It is wrong that the furnished tenant should be excluded both from rent protection and from the new private rent allowance. Not only is he alone excluded—and he is the poorest in all the groups of people concerned—from any financial aid under the new White Paper, but his taxes will help to pay for the benefits which go to other substantially better off sectors. How this is to be reconciled with the saying "From each according to his ability to each according to his need" I leave the right hon. Gentleman to calculate.

I wish to say a word or two about the effect of the new policies on the rate of council building. It is impossible to assess this accurately from the White Paper because there is no breakdown in the White Paper of the future subsidy bill. Incidentally, the White Paper refers to "current prices". I hope that I have not misunderstood it and that it does not mean that the value of the subsidies will fall automatically as a result of inflation. I should have thought that the White Paper should have referred to "constant prices" rather than "current prices". I hope that we can be reassured on this point and I hope that I am not being unnecessarily alarmist.

However, the subsidies will remain at their present level roughly of £220 million. What we do not know is how that figure will be divided between the cost of rent rebates, of the private rent allowance, of the various transitional subsidies, of the slum clearance subsidy and of the rising cost subsidy. Unless we have a breakdown of the total of Government aid, we cannot ascertain the effects on house building. I hope that we shall have some more information on this matter when the Minister replies.

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

The White Paper prices are "constant prices".

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby

I am much obliged.

The Secretary of State says, and he has repeatedly said it, that the new policies will speed up slum clearance. I devoutly hope that he is right. I think that he is right in principle in concentrating relatively more of the aid on the areas with the worst slums or the greatest need, although the total of the aid is too small. Nevertheless, I remain anxious about the effect on total council house building. We cannot forget, although the right hon. Gentleman would like us to forget, his remarks in opposition on the subject of council house building in his famous what I call "for all sorts of seemingly good purposes" speech in June, 1969. He said : … the stock of 30 per cent. of housing now in local authority hands is far too high …". This represents the right hon. Gentleman's view. If it does not, he should never have made that speech. That speech, which I read in full about six months ago—it is not a selective quotation—shows a strong belief that, relatively speaking, the amount of council housing should drop as a proportion of the total. That makes me anxious.

Moreover, the Government's proposals do not do anything to remove what are often the most critical obstacles to slum clearance and urban renewal—the shortage of land, the structure of local government, and so on. They may help the Inner London boroughs within their own boundaries. I hope that they do. But the Inner London boroughs cannot solve their housing problems without help and land from the outer boroughs, and there is nothing in these proposals which will enable that help to be more freely given.

The other point about the effect on house building is that these proposals come at a time when the trend of public house building is still downwards, as it has been ever since the Tory landslide in the local government elections in 1968. We keep on hearing, especially from the Minister for Housing and Construction, wildly optimistic statements about what is happening to house building, and they always evoke loud cheers from Conservative back-bench Members who naively suppose that there has been some revolution in the state of affairs since the right hon. Gentleman took office.

It is true—and I am glad that it is—that private house building is encouragingly on the increase. But the position is different in the public housing sector, as the Minister must know. The recent Report of the National Economic Development Office of 9th July states : Output"— in the public housing sector— is now expected to fall 11·5 per cent. in real terms in 1971 and to flatten out in 1972. This is a highly depressing outlook. I hope that the Government's proposals will alter the situation. I also hope that the election of large numbers of Labour Party councillors will alter the situation. The trouble is that they will not have the money to do what they want. Nevertheless, I have strong fears that the effects of these proposals will be bad, not merely for equity or for the tenants, but for the total rate of house building.

There are individual proposals in the White Paper which we welcome, such as the private rent allowance, greater concentration of help in the areas of need, and paragraph 35 dealing with security of tenure for council tenants. I certainly accept the need for a total review of housing finance. [HON. MEMBERS : "Oh."] I said that at the beginning of my speech, and I have said it at the end. What we on this side of the House reject are the main financial features of the Government's proposals. The furnished tenant—the poorest of all—comes off worst. The owner-occupier, who on the whole is the best off, will come off best. He alone receives non-means-tested aid from the Exchequer. The council tenant is faced not only with large increases in rent but with the prospect of subsidising the Chancellor of the Exchequer through the housing revenue account.

I believe that these features of the proposals are damaging socially, damaging economically, and damaging in terms of housing policy. That is why we on this side of the House shall vote against the proposals tonight.

6.40 p.m.

Photo of Mr Gilbert Longden Mr Gilbert Longden , South West Hertfordshire

If I may respectfully say so to the right hon. Gentleman the Member for Grimsby (Mr. Crosland), he made the very, very best of a very, very bad case. As an example of making bricks without straw, it was admirable. Unfortunately, one of his bricks, when he compared his right hon. Friend the Member for Coventry, East (Mr. Crossman) with my right hon. Friend, had the effect of sending the right hon. Gentleman the Member for Coventry, East scuttling from the Chamber.

This White Paper, on which I once again, most respectfully, congratulate my right hon. Friend, sets out the problems resulting from our housing policies hitherto, and sums them up briefly on page 1. These policies take too little account of the need to keep the existing stock of houses in good heart. They have provided too little help for people in need. And they are fundamentally unfair. They take from people who can ill afford it to give to others who, by comparison, often have no need of help at all. So, says the White Paper, … the time has come for a radical change in housing policy. Nothing less will create the conditions for a final assault on the slums, the overcrowding, the dilapidation and the injustice that still scar the housing scene. It is about one of these that I later wish to say what will be only a very few words. Why is there this need for a change in policy? Whether the Opposition accepts the need for change, I do not know. We learn that in the public sector the Existing subsidies for new buildings are indiscriminate. We learn that 90 per cent of the housing subsidies"— of £220 million— was used to reduce the general level of rent regardless of the need of tenants. Only 10 per cent. was used to grant rent rebates to poorer tenants. As a result many in need received little or no help. We learn that The present system provides subsidy for housing authorities which do not need it. We learn that the burden of the subsidies is unfairly distributed because many taxpayers who pay their share of Exchequer housing subsidies (and all taxpayers do so), and many ratepayers who meet the cost of rate fund contribution?, are poorer and worse housed than the council tenants whom they subsidise. We learn that The present system has produced a pattern of rents which varies unfairly between the tenants of one authority and another because only about half the housing authorities operate rent rebate schemes, so that all the tenants of the other half are subsidised, whatever their means.

We learn that, In the private sector rent control was introduced to protect the tenant. … The rent of private tenants subject to rent control has not moved since 1957. … Many landlords of controlled tenants are poorer than the tenants who enjoy a very low rent at the landlord's expense. So rents are to go up)—and 2½ million tenants who now get no help are to be helped if they need it.

What I want to know is, do the Opposition deny that these are the drawbacks of our present policies? If not, do the Opposition think they are acceptable? If not, what will the Opposition do to change the policies? Probably they would do nothing because, as my hon. Friend the Member for Uxbridge (Mr. Curran) said in an admirable article yesterday, the Labour Party assumes that all council tenants are poor and all landlords rich and they like to pauperise their fellow citizens.

I would like the Opposition to answer three questions. What proportion of a man's income does the Labour Party consider it reasonable that he should have to pay to keep a roof over his own head and that of his family?

Photo of Mr Ernest Perry Mr Ernest Perry , Battersea South

What does the hon. Member think?

Photo of Mr Gilbert Longden Mr Gilbert Longden , South West Hertfordshire

I will tell you on another occasion. [HON. MEMBERS : "Oh."] I want to know what the Labour Party thinks. I have my own idea of what a man could be reasonably expected to pay for the roof over his head.

Photo of Mr Gilbert Longden Mr Gilbert Longden , South West Hertfordshire

No. I want to know what the Labour Party thinks. The second question I ask the Labour Party is this : Can any Member of the Labour Party tell me why he considers that any man under the age of retirement who is neither physically or mentally disabled should expect that the rent, or any part of the rent, of the home which he himself has chosen should as a matter of course be paid for by his fellow citizens? And the third question I would ask the Labour Party is why it considers that any man who is unable to fend for himself in this matter should expect to get such help from his fellow citizens without proving his need?

The Labour Party is constantly talking of the Prime Minister dividing the nation into two. I believe that the two nations which have been produced by the Labour Party are these : section A, people who are prepared to stand on their own feet ; and section B, people who, after six years of war and 12 years of Labour Government, have grown to expect other people to do these things for them. We must hope that section A is in the great majority.

But of all the injustices "that still scar the housing scene" none is worse than the control of rents of small properties owned by the small man, or woman, who has chosen to invest his savings in real property rather than in stocks and shares or the Post Office and who has for 50 years been prevented from charging a rent which will allow him to keep the property in decent repair and to enjoy a reasonable return on his capital. For years in this House I have been pleading that man's cause. On 14th June, 1968, in an Adjournment debate, I used these words : I make no apology for raising the matter again today. In so doing, I have no interest whatever to declare except the interest which every Member of Parliament should have in fighting injustice and in striving to redress the justifiable grievances of Her Majesty's subjects. Unfortunately for them— these particular subjects— are too unorganised, uninfluential and scattered to have much electoral significance, and unfortunately, too, they now have a Government who react pathologically to the word 'landlord' and who have no great love for private property in any form. I have never understood why, just because a man has chosen to invest his savings in house property rather than in equities or gilt-edged securities he should be presumed to be a Rachman, nor why. since some tenants need to be subsidised, it should be at the exclusive expense of some of their fellow citizens rather than by us all."—[OFFICIAL REPORT, 14th June. 1968; Vol. 776, c. 665.] This was summed up rather neatly by the Daily Telegraph last August : Suppose a citizen found himself singled out by the State and told that, by virtue of his having a car, he must give regular lifts to a certain non-motorist as long as the latter wanted them. Suppose that the motorist was told that he must charge less than cost for this service. Suppose further that this arrangement was to stand regardless of the passenger's means. The unfortunate victim would, reasonably, suppose that officialdom had succumbed to extreme malice or total derangement. In February, 1970, I wrote to my right hon. Friend, then the Shadow Minister, and again last September, quoting, among other things, The Times comment in a leader of 26th August, 1970: The persistence of these controlled tenancies in their present form is a disgrace to successive Governments. They are a forced subsidy of one private person by another who may be no better placed financially, and they hasten the decay of part of the nation's housing stock. My right hon. Friend replied to me on 7th September making it perfectly clear that he fully understoood this and as soon as possible was going to do something about it and he has been as good as his word and I am very grateful to him for that.

There are four things I should like to bring to my right hon. Friend's attention as a vice-president of the U.D.C. Association. That association suggests these points, which I think have already been mentioned by the right hon. Gentleman the Member for Grimsby, but I would reiterate them. I simply put these points to my right hon. Friend for his attention, not necessarily agreeing with them. The association's first suggestion is that subsidies should be phased out over a longer period than my right hon. Friend proposes. The second is that the cost of rent allowances in the private sector should be borne wholly by the Exchequer. The third that the Secretary of State should be able to give special help to areas where his proposals produce exceptional rate burdens. Lastly, the association would like a slower progression to fair rents than is proposed by my right hon. Friend. In regard to that last point, however, now that a method has been devised of subsidising the poorest tenants who cannot afford to pay a fair rent, I hope that there will be no unnecessary delay in implementing these reforms.

6.51 p.m.

Photo of Mr John Forrester Mr John Forrester , Stoke-on-Trent North

As so many hon. Members wish to speak, I will endeavour to take only a few minutes of the time of the House. I regarded it as a little unfair that the hon. Member for Hertfordshire, South-West (Mr. Longden), who has made such a great study of the question of what proportion of a person's income should be paid in rent, did not give us the benefit of his deep thought.

The hon. Member went on to ask us how much a person should get from his fellow citizens without proving need. I accept that there are times when we need a means test. It is the type of means test which makes the difference between hon. Members opposite and those of us on this side. I would ask the hon. Member, however, whether we ought not to think in terms of owner-occupiers having a tax relief on their mortgages in the opposite direction, so that the poorer they are the greater the tax relief and the richer they are the less relief they get on their mortgage. This, surely, would be in keeping with the arguments that the hon. Member put before the House.

I understand that the aim of the Government's legislation is to stabilise the subsidies which the Government will be paying. The subsidies will be shared with others in the private sector. It must, therefore, follow that many people must pay considerably more so that the subsidies can be spread over a greater number of people.

No one has suggested, however, exactly how many people will get subsidies. I understand that it is extremely difficult to calculate the figure. How is it possible, therefore, for the Government to estimate exactly how much they will save on the amount of subsidies that will be paid? If they cannot do the one sum, it must be rather difficult to find the answer to the final sum.

If rents are to rise every three years, as is provided for in the White Paper, without any reference to the housing revenue account, what criteria will be laid down? Will it be simply a question of keeping up with the cost of living or with the rate of inflation? Will the aim be to stabilise the subsidies which the Government have to find, or will it be done at the whim of rent officers? If it is done at the whim of rent officers, there could be one of two effects. Either the rent officer will apply a figure for rent which will give considerably more money and, therefore, as my right hon. Friend the Member for Grimsby (Mr. Crosland) said, the housing revenue accounts will create a much greater profit for the Government to spend, or there could be the opposite effect of reducing the amount of money in the housing revenue accounts, with the result that the Government have to find much bigger subsidies to meet the new situation.

My right hon. Friend referred also to the cost. Clearly, a small army of administrators will be needed to check all kinds of things and to investigate every anonymous letter that will be delivered to every housing manager's office. I wonder whether the Government have worked out how much this will cost and whether it will be worth imposing this kind of extra expenditure on housing revenue accounts.

So far, the Government have not put forward a case for dealing with inflation. With swingeing increases in rent, there will clearly be big wage demands. It might well be argued that it is not only council tenants who have been subsidised in the past, but that the whole of British industry has been subsidised by ratepayers and taxpayers, who have kept down rents. Anybody who thinks that trade unionists will not apply for wage increases when a man faces a £2 increase in his rent is living in the proverbial land from whence the cloud cuckoo comes.

This will be the direct effect of the Government's policy. Whereas rises in rents may be selective, wage increases which follow from increases in rents will not be selective but will be right across the board. One might well argue, therefore, that the Government are creating an inflationary situation in which everybody gets a wage increase so that a selected number of people can pay higher rents. This will not do very much good to the Chancellor's plans for the economy.

I am sure that the Government have studied the article in yesterday's Sunday Times, which suggested that some people would need an 18½ per cent. wage increase to enable them even to stand still. I wonder whether the Government have decided that that is a reasonable figure or whether they hope that their proposals will lead to something less than that.

I come to the social question. I understand that the aim of the Government's proposals is to force people into owner-occupation, but this will have the result of driving out of the pool of council housing those who can afford to pay an economic or a profitable rent. Eventually, we shall be left with only those who require rebates occupying council housing. The effect of this will be quite dramatic on the country as a whole.

One is tempted to ask how long it will be before local authorities are left with only tenants who require rebates, because if the rent increases are of a certain size, anybody who has the wherewithal will change to owner-occupation. When we reach that stage and we are left only with people who require rebates, we shall be back to the present situation, in which all tenants may receive a subsidy of some kind.

What instructions will the Government give to local authorities in allocating houses to make sure that we do not reach the stage, which my right hon. Friend the Member for Grimsby suggested, that they may be tempted to channel the poorest tenants—those who require the biggest rebates—into special areas, into their poorest houses and their poorest areas? How shall we prevent local authorities from creating ghettos for the poor in our major cities?

The social problems flowing from that would be enormous and might well far outweigh any saving in money that the Government may have in mind. Indeed, it is quite possible that other departments—Health, Social Security and Education, for example—would have to spend more money to counterbalance the problems that will have been created by the Government's proposals.

If that is to happen, will the Minister consult local authorities to make sure that there is much greater freedom of transfer, not only between local authority housing, but also between private and local authority housing? I regard it as a gross injustice that if a rent rebate scheme is in operation, a person should be condemned to live in a terrace-type house when he could live in a modern semidetached house with a garden round it for almost the same amount of rent. It seems that this one has not been thought out. Will not there be a feeling of bitterness in peoples' minds when they find that through no fault of their own, they are left in an old terraced house when their friends pay very little more rent but live in better surroundings?

I should like to make a constituency point. On pages 3 and 4 of the White Paper, the Minister makes great claims for the house improvement scheme—and it has many things to commend it—but before the Housing Bill comes back from the House of Lords, will he look again at the question of the 75 per cent. grant? It is difficult to understand why there should be a 75 per cent. grant for the improvement of a house in an unemployment area and only 50 per cent. in another area. This is extremely difficult to justify.

Different areas have different problems. The problems in one area are no less acute than the problems in another, no less in need of urgent solution. If the Minister cannot look at the whole country, will he look at the areas included in the Local Employment Act, 1970 which were defined as having a special need because of the great amount of dereliction. Will he see whether those areas can be included in the 75 per cent. grant provision?

Will the Minister also look again at the question of the sale of council houses? I know that this is part of the political faith of hon. Members opposite, but I cannot see any sense in selling to a sitting tenant a house which costs £1,500 to build and replacing it by a house which may cost £4,500. When the rent is subsidised, there may be some point in it, although I am not convinced.

A person in a £1,500 house will now have to pay a profitable rent to the housing revenue account. If he cannot afford a profitable rent he will not be able to get a mortgage anyway. If the house is sold to him, another house will have to be built to house someone on the waiting list. A person on the waiting list will get a local authority house only if he cannot afford to buy one.

What will happen is that the authority will sell a cheap house and build a dear house and, instead of charging £3 a week for the one it has sold to the sitting tenant, it will charge the newcomer £7 or £8 a week fair rent. Either that tenant will not come into the council house because he will buy his own house, or the local authority will be faced with having to allow a bigger rebate because of the difference between the cost of the two houses. Although the policy of selling council houses may have some merit when an authority has a surplus of houses, it has no merit when an authority has a deficit of houses, especially when the new rent policy drives tenants into owner-occupation.

The Minister quoted paragraph 18 (viii) of the White Paper, which proposes that local authorities should be allowed to pay legal expenses. If local authorities are to pay legal expenses for tenants in corporation houses, will it not be equally just for them to pay legal expenses for people in slum houses who prefer to buy their houses rather than take up local authority accommodation?

The Minister has a problem, as I have no doubt my right hon. Friend had a problem, but this is a crude, blunt instrument that has been fashioned. The Government are trying to bludgeon people into owner-occupation, with all the social and economic consequences which will follow. This is part of the Jekyll and Hyde character of the Government. Whilst they cry about the dangers of inflation, at the same time they bring in measures which give half-a-dozen twists to the inflationary spiral. This is such a measure. Many questions must be answered and many more refinements are necessary before hon. Members on this side of the House can give their support to the White Paper.

7.3 p.m.

Photo of Mr Arthur Jones Mr Arthur Jones , Northamptonshire South

I want to go back briefly to a point made by my right hon. Friend the Secretary of State about the quality of the judgments and the decisions which the previous Socialist Administration took on housing. He was critical, as I am, of the lack of decision and the lack of positive policy in their endeavours to solve some of the problems in the desperately difficult housing situation with which the country is faced.

I will go back one stage further than my right hon. Friend and refer to the Report of the Working Party on Local Authority Housing Finance published in September, 1964. This was a highly powered, representative Committee, and the advocacy contained in its Report was accepted by the Housing Committee of the Association of Municipal Corporations. I will quote from paragraph VII(vi): There is need for a revised rent resources test, to take account of our findings on the distribution of subsidies and the rent-paying capacity of council tenants. The previous Administration had that clearly definitive statement before them during all the years they were in office and they lacked the guts to implement it. The need is for resources. There is no possibility of solving the housing problem on the limited resources which have been available to us. That recommendation of substance which I have quoted was ignored by the Socialist Administration. They did not recognise the necessity for increased resources, and this was fundamental to the failure of their housing policy. One wonders to what extent they were trying to adjust their ideas to ensuring the least possible impact on the the tenants of council properties.

It was clear that there would not be adequate resources from the taxpayer. The taxpayer was required to meet the rising housing subsidies under the 1967 Act and, of course, the generous grants for improvement and conversion, but these measures were entirely inadequate to provide the necessary resources.

The Rent Act, 1965 showed a glimmer of light when it introduced the concept of fair rents. In terms of the philosophy of housing this was sound. On Second Reading of that Bill in 1965 we were promised the beginning of the implementation of fair rents and their extension and development down the years, but we never moved from the original introduction of the proposals, despite the promises that were made from time to time.

The right hon. Member for Grimsby (Mr. Crosland) said that there was no logic in taking fair rents into the public sector. With respect, we are not trying to deal with matters in terms of logic ; we are looking for the increased resources which are fundamental to solving the housing problem. It is the failure to recognise this which lies at the root of the failure of the previous Administration to solve the housing problem.

We need to look to council tenants, as we are looking to private tenants, to pay a fair rent if they are in a position to do so. If they are not, they get the benefit of the subsidies proposed in the White Paper. I believe that in this way we would ensure a tremendous increase in housing resources.

I should like to deal briefly with three points of detail in the White Paper. The first is dealt with in paragraph 46 and it relates to cash allowances to private tenants. In Appendix 2 the local authority is given the option of making a periodic payment to the tenant. I am sure this will help to meet the point made by the hon. Member for Stoke-on-Trent, North (Mr. Forrester) about cutting down the amount of administrative detail. This also will assist in circumstances where a tenant is in difficulty in paying the rent to a landlord and will enable payments to be made direct. There should be some positive simplification in the arrangements. It will be a heavy administrative burden if a local authority is to be expected to make a weekly payment to a tenant.

Paragraph 4 of Appendix 2 deals with rent rebate, which is to be on either a five-weekly assessment basis or a two-monthly basis depending on whether the tenant is paid weekly or monthly. Rate rebate is calculated on a tenant's income six months in arrear. Employers will be asked to submit two different calculations, one for rent rebate and another for rate rebate. It would lead to considerable simplification if these two assessments could be submitted at the same time.

I am not happy about paragraph 2 of Appendix 2 which provides for the allowance being based on only a proportion of the fair rent if the dwelling is much larger than the tenant requires, or is situated in an area of high property values where the tenant is living from choice rather than from necessity. There will surely not be many cases of that description where a local authority will be required to make a judgment. The local authority will be asked to make a difficult subjective judgment and I hope the Government will think again about this rather narrow and insignificant proposal in the White Paper.

I give a warm reception to the White Paper which mirrors the thinking of many hon. Members in the House. I am sure that great benefits will flow from these proposals.

Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

I am grateful to the last three hon. Members for being reasonably brief. I hope that the practice will continue because there are still many hon. Members who wish to speak.

7.15 p.m.

Photo of Mr Frank Allaun Mr Frank Allaun , Salford East

I hope to comply with your request, Mr. Speaker. At four o'clock this afternoon the Government made a statement on their attempt to restrain inflation and prices. And at six o'clock they introduced another statement which will double rents for millions of families. That is contradictory ; it is nonsense ; and it is hypocrisy. If the Government are genuine about keeping down prices they will have to scrap these rent increase proposals.

My main objection to the proposals—and I have many—is that they do not just provide for a redistribution of subsidy but that they will lead to a huge net reduction. The case might be argued for a redistribution, with increased subsidies for some and a reduction of subsidy for others. But this is not what the Government intend. Up to £200 million a year will be taken away and this inevitably will result in higher rents. I have consulted my city treasurer about this and he confirms as a fact that rents will be raised.

Why is the Minister doing this? I will quote page 2 of the White Paper : Housing subsidies from taxpayers and ratepayers cost, some £200 million in 1970–71. If they continued their annual cost would increase over the next 10 years by at least £300 million … it would be a staggering addition to the nation's tax burden. I repeat the words "a staggering addition". This is not so. The figure of £300 million is but 1½p in the £ of all Government and local government spending. The yearly increase would be only one-tenth of that, namely, 0·15p in the £ of all Government spending. That would be the figure if the Minister left subsidies as they were. That is hardly "a staggering increase". I believe that the Government should leave the subsidies alone. Before long, there will be crowds outside the Ministry with placards saying "Hands off the housing subsidies". The Government will find themselves in real trouble—and deservedly so.

Another feature of the proposals is that rents will be raised so high that the tenants will be forced to buy their own houses—either the houses in which they are living or other houses—because I do not think the Labour-controlled councils will want to sell council houses. Those tenants will be forced to buy their own homes even though they cannot afford mortgages. What will be the result? House prices will rise even more sharply than has been the case up to the present. This will be brought about because of the increased pressure on the houses available.

I now turn to the Minister's little trick. The newspapers have reprinted his tables showing how certain families paying £5 a week rent plus rates will receive £1 reduction. But what the tables conceal is that the £5 per week rent will be the new rent fixed under the Bill and not the existing rent which might be only £2. So with a rent of £5 a week, plus rates, even after taking away the rebate, the tenants will be worse off than they are at present. Some of them will get a rebate but most of the recipients will be paying more rent than now.

As regards the private landlord tenants some 1·3 million will lose their rent control and will come under the rent-fixing machinery instead. This will increase their rent on average to 2·6 times the present rents, as the figures we have extracted from the Ministry show. Another feature of the proposals is that landlords and tenants are to "agree" on rents. Everybody knows that because of the housing shortage landlords and tenants are not equal bargainers. What will happen is that a landlord will say to a tenant who is applying for a house, "If you will agree to pay this rent I will give you a tenancy. If not, I will give it to some other tenant who will be more compliant."

As for the effects on house building, my hon. Friend the Member for Grimsby (Mr. Crosland) quoted rents of £10 for new houses. This is far above what a working man can afford. Therefore, council building programme will fall still further.

I turn to deal with Press comment. It is true that most newspapers think this is a wonderful scheme. Certainly economists think it is wonderful. Indeed, everybody thinks it is wonderful—everybody except the tenants who will have their rents doubled. I quote one publication which does not regard the scheme as wonderful, a paper that represents the real experts and has no party affiliation or bias. I refer to the Municipal and Public Services Journal of 16th July. It carries a whole page editorial which is almost wholly condemnatory of the scheme : The immediate reaction from the A.M.C. and U.D.C.A. is one of cautious hostility … It seems inevitable now that the suspicions and resentments already being expressed in local government circles will boil up into a major row. These two bodies are at present dominated by Conservative councils, so goodness knows what they will think when Labour gets control next May. The article ends : It is hard to see in this 'fair deal' philosophy anything other than a deep contempt for the owners and tenants of nearly one-third of the nation's housing stock. I challenge the Minister to come to the housing estates, face the tenants there, and tell them why he is doubling most of their rents. I believe that he and his right hon. Friend will go down in housing history as the men who tried to double rents and caused serious social disturbances on housing estates.

7.20 p.m.

Photo of Mr Peter Trew Mr Peter Trew , Dartford

The hon. Member for Salford, East (Mr. Frank Allaun) expressed fears about how the new rent system may work out in practice. So did his right hon. Friend the Member for Grimsby (Mr. Crosland). Though it is quite right that they should express their fears, and though I know that the hon. Member has thought very deeply about these problems, I do not believe that either he or his right hon. Friend has sustained the case. In fairness and in justice I do not think that one can quarrel with a system that ends indiscriminate housing subsidies and redistributes them to those who really need them.

I was astonished to hear someone of the intellectual reputation of the right hon. Gentleman trying to argue on the ground of logic that we should retain the existing system whereby the level of rents is determined by the age of the housing stock ; that in an area where there are a lot of old houses there should be low rents, and in an area where there are new houses the rents should be higher.

I agreed with the right hon. Gentleman when he said that a large proportion of tenants would qualify for the new subsidy. If one considers the needs allowance and the formula for tapering off, one realises that family incomes of £30 and perhaps even of £40 a week could in some circumstances qualify for a rebate. When one further reflects that according to the Prices and Incomes Board Report on council rents about 35 per cent. of council tenants are in receipt of pension or other social security benefits which would almost by definition qualify them for some rebate, and that 70 per cent. of council tenants have family incomes of under £35 a week, it is fair to say that a substantial proportion of council tenants will qualify for rebate. One would not be far wrong in saying that about half of council tenants will qualify for a rebate of some sort. But the right hon. Gentleman cannot have it both ways. He cannot complain on the one hand that rents will be far too high and, on the other hand, say that too many people will qualify for rebates.

The right hon. Gentleman and some of his hon. Friends spoke of an intention to bludgeon or force people into home ownership. We on this side make no apology for wanting to encourage home ownership. I certainly hope that one of the consequences of a gradual move to fair rents for better off council tenants will result in their deciding to buy homes of their own. One cannot spell out too often the advantages of home ownership. Nothing gives a family a greater sense of security than to own the roof over its head. Houses are better maintained when privately owned. To take on the responsibility of a mortgage is to undertake one of the best long-term savings plans anyone has devised. It gives every family an almost sure hedge against inflation.

I welcome the references in the White Paper to the powers of local authorities to assist council tenants with removal expenses and conveyancing expenses when they want to buy. I should like to see local authorities go further, and bring to the notice of council tenants the advantages of home ownership—and not in any sense of compulsion.

Hon. and right hon. Members opposite must be careful not to put themselves in the position of trying to get council tenants to live in council accommodation whether they want to or not. The housing policy of any country must have some regard to the aspirations of the people. Any opinion survey will show that in Britain the answer is that the vast majority of people want to own their own homes.

Some years ago, when I was still prospective candidate for Dartford, we carried out a survey on a large council housing estate ; and asked a question not usually asked : "Do you believe that your children will be council tenants or own their own homes?" Of those interviewed. 80 per cent. believed that their children would live in their own homes. So when we are deciding what the relative balance between private and public building should be, we must have regard to the aspirations of the people.

There is a desperate need in some areas for large-scale building of low-cost housing, and in many cases councils are still the best authorities to undertake this work.

I welcome the proposals in the White Paper for slum clearance and rising cost subsidies. These will speed up and make easier the whole task of urban renewal. I believe that these measures, together with the provisions for home improvement, will be useful weapons in tackling what I believe is one of the great challenges of the 'seventies and 'eighties—the problem of transforming and renewing the decaying areas of our cities.

If we are to get the best out of these proposals we must get clear in our own minds the answer to a number of questions. For instance, in urban renewal what is to be the relative rôle of local authorities, of the voluntary housing movement and of private enterprise? My understanding of the slum clearance subsidy, and I hope that my right hon. Friend will correct me if I am wrong, if that authorities will be able to apply it to land which they make available to the voluntary housing movement and to private enterprise. I hope that this is so.

Something else we must ask ourselves is whether private enterprise is to continue to build virtually only for sale or whether it will be possible in some way to encourage private enterprise to build for rent, but to encourage it in a way which lets it get ahead confident in the belief that a future Labour Government will not undo any proposals we introduce. I believe that the greatest single obstacle to giving some sort of encouragement to private enterprise to build for rent is the fixed and almost sacred belief of the party oppose that there is something evil and wicked in being a landlord unless that landlord happens to be the local authority.

Another question is : what are the relative advantages of improvement and rebuilding? To what extent can we reduce the rent levels, and reduce housing stresses by reducing the pressure of population in urban areas? What is the rôle that even more overspill schemes may play?

Finally, we must ask ourselves what our strategy for urban renewal is to be ; whether we are content to leave it largely to individual local authorities—even the much larger metropolitan authorities which emerge in local government reorganisation—or whether we believe that there should be wider co-ordination—and even ask ourselves the extent to which we feel my right hon. Friend's Department should issue positive guidance to local authorities in this task of urban renewal. An enormous challenge faces us, and I believe that the White Paper provides us with valuable tools for setting about the task. It injects more common sense and justice into housing than we have had for many years and I welcome it.

7.29 p.m.

Photo of Mr Richard Leonard Mr Richard Leonard , Romford

The hon. Member for Dartford (Mr. Trew) has shown a quite touching belief in the virtues of public polls, and has indicated that he has been influenced by the results of his own do-it-yourself exercise in this direction. I hope that he will go back to Dartford and conduct another poll, asking his constituents, and particularly those who are council house tenants, what they think of the proposals in the White Paper.

As the representative of a constituency with a very large number of council tenants, I have found that every one of those to whom I have spoken sees the White Paper as a mean and squalid attack on the standard of living of people living in council houses. It may be that the details of the White Paper are imperfectly understood by my constituents and that when they become more familiar with it they may find some aspects of the proposals more acceptable. But if there is a great degree of misunderstanding, Ministers have only themselves to blame. Apart from the fact that repeatedly both the Minister for Housing and the Secretary of Stale have refused to answer quite simple questions from this side of the House about the details of the proposals, and that many of the details in the White Paper are couched in extremely opaque language, there seems to have been a total failure to consult any representatives of council tenants in drawing up the proposals.

Photo of Mr Ronald Brown Mr Ronald Brown , Shoreditch and Finsbury

My hon. Friend will be aware that last Wednesday I put down five Questions to the Department concerned, the answers to which would have been valuable in this debate, but the Department refused to answer them.

Photo of Mr Richard Leonard Mr Richard Leonard , Romford

That confirms my point. Last Tuesday, the Secretary of State said : We have discussed the details of our plans with the local authority associations and the voluntary housing movement."—[OFFICIAL REPORT, 13th July, 1971 ; Vol. 821, c. 214–215.] Not a word was said by the Secretary of State about consultations with the representatives of the 5½ million council tenants in this country. It may be argued that no single body exists which can claim to speak for those 5½ million tenants. But the same objection could be made with regard to the voluntary housing movement. No single body could claim to represent that movement, yet consultations took place.

A number of highly respected and responsible organisations represent council tenants in different parts of the country. In London the Association of London Housing Estates, which represents tenants on 116 different estates in the Greater London area, is a body recognised by the Government and by the Greater London Council for grant aid under the urban programme. In Liverpool the Amalgamated Tenants' Associations Co-ordinating Committee represents the great majority of council-house estates in the city. Other similar bodies in different parts of the country could well have been consulted by the Government before these proposals were put forward. Would the Minister say whether there has been any consultation with representatives of tenant opinion? As far as I have been able to ascertain, there has been none. I should like a definite answer on that point.

My second point is that last Tuesday the Secretary of State gave the House a figure. He said that council house rents during the period of the Labour Government had increased by no less than 65 per cent. He seemed to regard this as a justification for the further very large increase proposed in the White Paper. That seems extraordinary. I should have thought that it argued in exactly the opposite way. If there has already been an extremely sharp increase in council house rents during the last five or six years, surely that substantiates a case for a plateau to be established—for a period of restraint—during which these previous increases can be absorbed by the tenants concerned. It seems incredible that tenants should now be expected to face with equanimity the prospect of a further increase, on average, of about 100 per cent. over the next three or four years.

Photo of Sir Harmar Nicholls Sir Harmar Nicholls , Peterborough

I see the logic of the hon. Gentleman's last point, but he will have to explain why we did not have an extreme reaction from his hon. Friend when the 65 per cent. increase was put on by his Government.

Photo of Mr Richard Leonard Mr Richard Leonard , Romford

I was not a Member of the House at the time, but I read the newspapers and I am well aware that my hon. Friend the Member for Salford, East (Mr. Frank Allaun) protested, with rather less justification, as vigorously then as he has now. It is a total misrepresentation of his position to suggest that he did not do so.

My third point is that the Government appear to be guilty of a deception—unintentional, I hope—in labelling their formula a "fair rent" formula, implying that they are taking over the same formula applied by the Labour Government to private rents and applying it to the public sector. There is a crucial difference. Apart from the cogent objections to applying fair rents to the private sector, which were set out by the Prices and Incomes Board, there is a crucial difference between this formula and the one applied in the private sector. The characteristic feature of fair rents, as we know them, is that the individual tenant is able freely to negotiate with his landlord what his fair rent should be, and it can then be registered with the rent officer. Only if there is no agreement, or if the rent officer believes that the agreement arrived at is not a reasonable one, is a fair rent imposed. There is no procedure in the White Paper for tenants to play the same rôle in the public sector. Paragraph 32 states, in part : The local authority will assess a fair rent for every dwelling. It will be free to consult the Rent Officer … No provision is made for consulting the tenant, who has the right to object only after a provisional assessment has been published by the local authority.

This is an utterly different procedure from the fair rents applied to the private sector. If the Government do not want to be characterised as deliberately misleading the country on this point, they should quickly devise a new term for this entirely new procedure proposed. I have no suggestion to make as to what that term should be, but I give notice that until the Government come up with something more acceptable, I shall consistently refer to these rents as "unfair" rents.

My right hon. Friend the Member for Grimsby (Mr. Crosland) said that we do not regard the present system of rents in the public sector, and of housing subsidies, as immutable. There is, indeed, a very strong case for moving towards a genuinely more rational and equitable system. The Government have failed to do something that they really should have done. They have failed to provide an explanation to the House and the country of why they have rejected the persuasive arguments of the Prices and Incomes Board in favour of historic cost rents. The suggestion of the Prices and Incomes Board seems, both logically and equitably, totally superior to this new proposal of the Government. The Government must attempt a refutation of the Prices and Incomes Board's argument if their own proposals are to carry any conviction.

Finally, there is a great deal of room for improvement in the provision and management of public sector housing. Many of the problems in this context were considered with great sensitivity two years ago by the Cullingworth Committee and valuable recommendations were contained in its Report "Council Housing—Purposes, Procedures and Priorities". Last Thursday my hon. Friend the Member for Willesden, East (Mr. Freeson) said : Nothing further has been heard for over a year. When will the Government act on the Cullingworth Report, or has it been shelved? May we be told today …"—[OFFICIAL REPORT, 15th July, 1971 ; Vol. 821, c. 750.] The Minister for Housing and Construction and the Under-Secretary of State subsequently spoke in the debate, but the specific question of my hon. Friend was totally ignored by both Ministers. So I repeat now, may we be told today what action the Government propose to take on the Cullingworth Report? Its recommendations are more relevant to the problems of council tenants—both actual and prospective—and they were based on far greater study and compassion and humanity than anything contained in the highly reactionary and objectionable White Paper which we are now debating.

Several Hon. Members:

Several Hon. Members rose——

Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

Order. The last six speeches have averaged 10 minutes each. I hope that we shall keep that up.

7.39 p.m.

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

The criticisms which are being made of the White Paper show two things. They show, first, the extraordinary difficulty the Opposition has had in making anything like a debating case against the White Paper. They show, second—I am sure that my Front Bench will have noticed it—the attempt to develop during the debate the suggestion that the White Paper will mean an enormous increase in rents of all council tenants. The assertion has been made in rather guarded language that the rents of council tenants will be doubled.

It is important that this myth should be strangled in the cradle. It will be developed into a large-scale myth unless we are careful to deal with it now. It is necessary to quote two figures which are given in the White Paper and which nobody has either disputed or tried to dispute. First, the average rent of council houses in England and Wales is £2 5s. a week—to use real money instead of getting sunk in foreign money. Under the proposals in the White Paper it is not possible for a rent to be increased by more than an average of 10s. in the course of a year.

The figure of an average of 10s. a year for an increase in rent provides the Council tenant with a solid reason for ignoring the assertion that this is a proposal for increasing the rents of council houses by 100 per cent.

There is, second, an important fact to which my hon. Friend the Member for Dartford (Mr. Trew) referred. I hope that the Minister will be able to amplify it in winding up. My hon. Friend the Member for Dartford quite rightly said that an investigation of council house tenants shows that a high proportion of them are people with low incomes. The notion that all council tenants are rolling in money is complete nonsense. A high proportion of them are pensioners or people of low earning power. There are various figures on this. There is good reason to believe that about half the council tenants earn so little that they will qualify for partial or complete rent relief under the proposals in the White Paper, which again is highly relevant to the myth that this will double the rent of every council house tenant.

I should like my right hon. Friend to give us details, if they are available, of the income level of council tenants who are poor and also a reasoned estimate of how many council tenants will qualify for partial or complete rent relief under the proposals in the White Paper.

My next point is of some importance to council tenants. I was interested to notice that in all the speeches which have been made from the other side only one reference has been made to this point, and that was a single-sentence reference. I noted that the right hon. Member for Grimsby (Mr. Crosland), in what seemed to me to be a very skilful throw-away line, expressed his approval in one sentence of what is for the council tenant perhaps the most important paragraph in the White Paper, namely, paragraph 35, which begins with this sentence : With the introduction of fair rents a council tenant will be entitled to the same protection against summary jurisdiction as any other tenant.

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

I will explain to the hon. Gentleman why. I fancy that my knowledge of council tenants is an extensive as is the hon. Gentleman's. I know, and if the hon. Gentleman does not know it, he should know it, that because a council tenant am be evicted without any formality and because the council holds over a tenant's head the power to evict without argument and without appeal, councils are able to enforce restraints, restrictions and regulations upon their tenants which no private landlord would dare to enforce.

This is one of the most widespread grievances in the country. It is a very proper grievance. It is a widespread grievance throughout Greater London and in every industrial city. It is a well-founded grievance. Because councils have been endowed by Parliament in its wisdom, if that is the right word, with the power to evict without notice and with-out argument, councils have been able to make regulations for the behaviour of their tenants and for the habits of their tenants of a sort that are intolerable.

I will not take up too much time, but I want to make some reference to these restrictions which councils impose on their tenants because of the power that they have to evict without notice. For instance, many councils do not allow their tenants to keep pets. The rule is, "No dogs. No cats. No rabbits. No bugerigars. No pets of any kind." There are councils which not only enforce the rule against pets but which compel the tenants to have their pets destroyed. Other councils impose rules on their tenants about which kinds of flowers they shall grow or whether they shall grow any.

Photo of Mrs Lena Jeger Mrs Lena Jeger , Holborn and St Pancras South

Some councils, at the wish of neighbouring tenants, impose restrictions on the keeping of pets, especially nasty, big dogs.

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

I am delighted to have had that interruption. It expresses a point of view which I totally repudiate. I will explain to the hon. Lady why I repudiate it.

I will illustrate my point that all over the country councils use the power to evict to impose upon their tenants restrictions and regulations which are socially intolerable in the 1970s. As I have said, some councils forbid their tenants to keep pets. Some councils insist that tenants shall grow flowers. They specify the kind of flowers, even the height of the flowers. Some councils have laid it down that tenants must not erect television aerials. Some councils lay down what colour the front door shall be painted or what colour a room shall be painted.

Some councils go further. There was a celebrated—I think that is the right word—case which attracted a great deal of publicity a few years back about the behaviour of the Socialist council which was then in charge in Jarrow. The council in Jarrow had on its housing estate a tenant whose wife wanted to earn some extra money. Her name was Mrs. Tudor. She became for a while a national celebrity. I am glad to think that, although it was before I was in the House, I did something to extend fame to Mrs. Nora Tudor.

This is how the Jarrow Socialist Council treated Mrs. Nora Tudor. She wanted to earn some extra money. She began doing embroidery at home. The council found this out and ordered her to stop. The chairman of the housing committee explained why the council had issued this decree to the tenant. His words were : "Her husband earns a good salary. She does not need the money. Therefore, we are not going to allow her to earn it". This was the epitome of petty tyranny. It is a form of petty tyranny which can be found in other areas.

Photo of Mr Richard Leonard Mr Richard Leonard , Romford

I have some sympathy with a lot of what the hon. Gentleman says. Does he not think that, as he holds these views, it is beholden on him to support Bills introduced by hon. Members on this side to extend the rights of council house tenants and give them security of tenure—Bills which have been blocked by the Government—rather than for him to support a White Paper which will place very heavy additional burdens on council tenants?

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

Surely that interruption is not on the level which we are entitled to expect in this debate. We are debating a White Paper which proposes to give the Government precisely the power that the hon. Gentleman thinks it ought to have, namely the power to forbid councils in future to use this bludgeon of eviction in order to regulate the behaviour of people who live in council houses.

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

Does the hon. Gentleman appreciate that all that paragraph 35 of the White Paper means is that those councils which now use the summary procedure will go to the county court instead? It does absolutely nothing for the security of the tenant. I am not against it, but it means practically nothing.

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

It is noteworthy how much indignation and restiveness this criticism arouses among Labour Members of Parliament. One would suppose that they would vote for this proposal to liberate council tenants from petty tyranny. Instead of welcoming it, they are doing their best to prevent my explaining it. They will not succeed, of course.

I want to give a further example of what I mean when I talk of petty tyranny. I do not know whether it is an accident or not—I will not go into the theory—but whether it is an accident or something which can be explained I leave to the House to judge. However, it is the case that when we come across examples of this petty domestic tyranny over council tenants, in nine out of 10 the councils are Socialist dominated. The habit of Socialist councils to meddle with tenants is very strong and extensive. There is at least one council—I do not wish to identify it by name, although I will do so if anybody challenges me—which has laid down that tenants would be turned out if it were discovered that they were living in sin. This council wanted to know whether a couple living in a council house had marriage lines or not. If the couple could not produce marriage lines, the council threatened to evict them.

I come to the interruption by the hon. Lady the Member for Holborn and St. Pancras, South (Mrs. Lena Jeger). There is not in this country any private landlord or group of private landlords who would dare interfere with the behaviour, and still less with the morals, of their tenants. Let me give an example. I have lived a great deal in London. I should like very much to see what would happen if the wicked and brutal private landlords of Hampstead, Chelsea and Belgravia began to enforce the rule that any tenants living in sin would be thrown out. If they did that, I can think of several squares in Chelsea which would instantly look like the Sahara Desert. There are whole areas of Belgravia, Hampstead and Bloomsbury which would be depopulated overnight.

The truth is that no private landlord dreams of meddling with the morals or with the behaviour of his tenants in the way in which councils habitually meddle. Equally the private landlord—I know how much he is abused and vilified—does not interfere with the domestic habits of tenants in the way in which councils do. The reason for this is that councils feel, as private landlords do not, that they have some right to regulate and perhaps improve the habits of their tenants. This is, I suppose, why one finds Socialist councils so eager to do it. The feeling among Socialist councils is that the working classes are lower classes who need to be looked after for their own good. It is this feeling of tutelage which inspires so much of the Labour movement—the desire to do good for the poor, to regulate them even if they do not want to be regulated. I do not believe that council tenants are in any greater need of regulation or supervision for their own good than are middle-class tenants or the tenants who occupy penthouses.

Photo of Mrs Lena Jeger Mrs Lena Jeger , Holborn and St Pancras South

The rules about the keeping of pets and the general tenancy rules of the Camden Council have been the same under both Conservative and Socialist majorities.

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

I am quite prepared to believe the hon. Lady. I know that power tends to corrupt even Tories. It corrupts them not as much as it corrupts Socialists, but it is almost as big a temptation. It may well be true, as the hon. Lady tells me, that some Tory councils have sunk to the level of behaviour of Socialist councils. I do not defend them when they do so. When I think of the behaviour of Socialist councils which have ruled Camden Town and Holborn, as a long-term resident in that region, I have often toyed with the notion of starting a "coals in the bath" society for council tenants. I believe that if a council tenant wants to keep coals in the bath he should be completely free to do so. He should have as much right to keep coals in the bath as any private tenant or owner-occupier has. I should be inclined to suggest that the right to keep coals in the bath is one of the hallmarks of freedom.

Far from accepting the hon. Lady's assertion that councils have some sort of right to regulate the behaviour of their tenants, I repudiate it totally. They have no right to concern themselves with the behaviour of their tenants. They are able to exercise their power to meddle simply because they have the power to evict. It is this threat which they hold over the heads of their tenants which enables them to make the rules and regulations which they make—rules that have no place in this country.

I am delighted that the Tory Party at long last has decided to strike the bludgeon from the hand of the municipal bully—for that is what it is. I welcome this White Paper for this reason as well as for a great many others. I am confident that the council tenants will welcome it, too.

Photo of Wing Commander Sir Robert Grant-Ferris Wing Commander Sir Robert Grant-Ferris , Nantwich

Before I call the hon. Member for Aston (Mr. Julius Silverman), which I am about to do, may I remind the House that much as we enjoyed the last speech, and interesting though it was, we are slipping a bit in terms of time.

7.58 p.m.

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

I will try to be brief. May I first refer to the point which the hon. Member for Uxbridge (Mr. Curran) laboured at great length. It has nothing to do with paragraph 35 of the White Paper. All that paragraph says is that a council, instead of taking a tenant to the police court for eviction, may take the tenant to the county court for eviction. That is all it does. It does not prevent eviction. It does not prevent the petty tyranny which the hon. Gentleman has described in great detail. All I can say to the hon. Gentleman is that he has obviously neither read nor understood the White Paper.

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

Mr. Curran rose——

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

I am sorry, but other hon. Members wish to speak. I would gladly give way if I had time.

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

On a point of order, Mr. Deputy Speaker. Is it in order for the hon. Gentleman to make an accusation against me and then refuse to let me answer it?

Photo of Wing Commander Sir Robert Grant-Ferris Wing Commander Sir Robert Grant-Ferris , Nantwich

I am afraid that I must plead some ignorance. I was trying to let as many hon. Members as possible speak in this debate. I am afraid that I missed the point. If the hon. Member wishes me to probe it further I will do so, or would he prefer to leave it as it is?

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

I would gladly give way, but other hon. Members have been here all day and wish to speak.

I regard the White Paper as being wholly reactionary. Some of the apparently mitigating features are merely fig leaves intended—unsuccessfully—to hide its reactionary nature.

In the private sector, about 1½ million dwellings will come out of control and go into regulation within the next three years. No matter whether they have no bathrooms or toilets, no matter what is their condition of repair, they will come out of control and go into regulation, and their rents may be doubled or, in many cases, trebled. It does not matter whether they are slums, provided that they are not actually represented as slums ; they will come out of control and go into regulation, and the rents will be increased. I regard that as a thoroughly reactionary measure.

It is said that the tenants may apply for a rent rebate. In Birmingham, under a Private Act, we have had a rent rebate scheme operating for the past nine months, a scheme not quite as generous as the Government's proposal but fairly generous none the less. Among 60,000 private tenants there are at present only 235 rebates operating. That is all. The scheme has almost been a fiasco. If the Minister presents his rebate scheme for private tenants as a great boon, he is very much mistaken. In fairness to the City of Birmingham, I should say that it set aside for the next financial year £100,000 for the rebate scheme. It is running at the rate of about £10,000.

Why should this be so? Undoubtedly, the private sector covers the poorest section of the population. It may well have been thought that there would be a great demand. I can give some of the reasons why the rent rebates are not being taken up.

One reason—this has already been mentioned—is that the most exploited sector, the furnished sector, does not come into the scheme at all. It does not come into the White Paper scheme, either. This is the point : the most exploited sector in which the highest rents are paid for the worst property does not come into it.

Second, because of their poverty, a substantial number of the Birmingham tenants are on supplementary benefit and would, therefore, derive no benefit from the scheme, as they will derive no benefit from the White Paper scheme, except that the local authorities will have to contribute towards the sums involved.

Another reason is the unwillingness of tenants to apply even when they qualify. In rent rebates, just as under the F.I.S. scheme, wherever a means-tested social benefit is offered, it is resented. Many people who are entitled do not wish to apply because they do not wish to declare their poverty as a means of securing social benefit. Hon. Members opposite do not appreciate the pride which people in this section of the community feel and their sense of humiliation in applying for a means-tested benefit. They do not want to make their poverty known.

It is true that there may be more people receiving benefits under the Government's scheme, which is more generous than the Birmingham scheme, but it is equally true that more people will receive them because, as the rents go up, more will qualify for rebate. In short, the common picture will be rents going up, say, £1·50 or £2, and the tenants, against that, receiving a rebate of, perhaps, 75p or £1. They will be so much worse off.

I do not regard that as a measure of compassion on the part of the Government. Quite the contrary. In the private sector, it is simply a massive subsidy to the landlords, paid partly by the Exchequer but mainly by the tenants at present in local authority houses.

I come to the public sector. A good deal has already been said about the increases which tenants will have to pay. There are those who argue that all rent allowances and subsidies should be means-tested. There is a case for it. But, if it applies to the council tenant, if he is asked to subject himself to a means test, what about the owner-occupier? I believe that the total of mortgage interest relief now received by owner-occupiers is running at about £300 million a year, more globally and individually than council tenants receive. Why should it be said that the owner-occupier should have that mortgage relief without means test?

Photo of Mr Norman Tebbit Mr Norman Tebbit , Epping

It is not a subsidy.

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

Of course, mortgage interest relief is not called a subsidy, but it amounts to the same thing, at the end of the operation.

Photo of Mr Norman Tebbit Mr Norman Tebbit , Epping

Mr. Tebbit rose——

Photo of Mr Charles Curran Mr Charles Curran , Uxbridge

Mr. Curran rose——

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

I have said that I will not give way any more. At the end of the operation, the Exchequer is so much worse off and the owner-occupier is so much better off.

The same goes for improvement grants, at present running at the rate of about £47 million a year, and to be increased under the new measures. They are not called subsidies. They are called grants. The term "subsidy" is directed only at the council tenant. No one asks the person whose property is to be improved at public expense what his means are. No one says, "You can afford to do it yourself. You can stand on your own feet". That approach is reserved for the council tenant.

When this subject has been raised, people have asked why tenants do not buy their own houses. Under this Administration, tenants are allowed to buy their own houses at a 20 per cent. discount. That 20 per cent. discount is a 20 per cent. subsidy. It may be £500 ; it may be £1,000. Where is the logic in saying that we must not subsidise the tenant but, once he intends to stand on his own feet and be an owner-occupier, we are prepared to give him a lump sum grant?

It is a piece of nonsense. Basically, the reason is that the Tory Party does not like council tenants.

Photo of Mr Norman Tebbit Mr Norman Tebbit , Epping

And the hon. Gentleman does not like owner-occupiers.

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

I have no objection to any of these grants being given. In 1959, we increased improvement grants for owner-occupiers. But what I am demanding is that the same principle should be applied to the one as to the other. That is all. I am not asking for any special privilege for the council tenant. I am asking simply that he should not be treated as an inferior person but should have the same treatment and not be subjected to a means test when he is given public money. It may be said to be wrong to give public money at all—I believe that it is right and in the national interest—but each section should be treated in the same way.

No further subsidies are to be given. The subsidy total is to be stabilised at its present basis, and out of the current £200 million a year subsidy one will have to deduct the amount of financial assistance to be given in the rebate scheme, which under the Government's scheme may be fairly substantial. I have no objection to the rebate scheme. What I object to is what goes with it in the White Paper.

On my calculation, it will not be possible to stabilise at that figure, even upon a fair rent basis—we do not yet know what a fair rent means—without a substantial reduction in the number of houses built. According to the White Paper, in 10 years the Government hope to be saving £300 million a year on what the subsidy should have been. It is impossible to stabilise it without bringing about a drastic reduction in the number of houses built.

One or two differences have been pointed out already between the approaches of the two sides to a fair rents system. We did not like the level of the fair rents which have been assessed. In the private sector the scarcity problem has been ignored by the assessment committees, which is why in London, for example, assessments are three times as much as they are in Lancashire and, in Birmingham, twice as much for similar properties with no greater amenity. That proves that the intentions of the Act have never been brought into operation. The original intention in our Act was to keep down rents. The obvious intention of this Government is to put them up. That is one basic difference. It is all very well right hon. and hon. Gentlemen opposite talking about fair rents. Their system has an entirely different purpose.

There is another point of difference. In the original Act, the method of calculating fair rents was based upon the individual assessment of each house. Is that to be done for 5½ million council tenants and three million private tenants? Of course not. There will be a mass assessment, as the G.L.C. has done. Rents will be worked out according to gross values. That principle was rejected when we introduced fair rents.

The Government's system will be quite different. We have not been told anything about the mechanism of the assessment committees. After all, the councils will not be concerned. They will make proposals, but the assessment committees will be the final arbiters of what are fair rents. In Birmingham and the adjacent area, with two million people, about 20 adjudications have been done in the last year. How will it be possible to do seven million or eight million adjudications? What is the mechanism? How many rent officers and how many more rent assessment committees will there be? How will it be done? We have heard not a word about this.

We shall have mass assessments. The main object of the scheme is to save large sums at the expense of council tenants. I condemn the White Paper root and branch. It is an attack upon 5½ million council tenants, and I hope that it will be resisted.

8.13 p.m.

Photo of Mr Norman Tebbit Mr Norman Tebbit , Epping

Perhaps I might deal first with one or two of the points raised by the hon. Member for Birmingham, Aston (Mr. Julius Silverman). I should have thought that he would understand, first, that a 20 per cent. discount which is offered to the tenant of a council house buying his house as a sitting tenant is precisely that. It is a discount because the market value of a house is less to a sitting tenant that it is on a completely free market, and in respect of the fact that the tenant has probably been paying rent for a considerable number of years. If the hon. Gentleman thinks that we ought to charge council tenants more, he should say so.

Photo of Mr Julius Silverman Mr Julius Silverman , Birmingham Aston

I was not saying that. Will the hon. Gentleman give way?

Photo of Mr Norman Tebbit Mr Norman Tebbit , Epping

No. The hon. Gentleman would not give way when my hon. Friend the Member for Uxbridge (Mr. Curran) had the motive behind what he said impugned, and nor will I.

Time and time again, hon. Gentlemen opposite come back to tax relief on mortgages. It is always the same theme. They think that anything less than 20s. in the £ tax is essentially a concession and a subsidy. I cannot understand why they equate paying less tax with being given a cash grant. The two are quite different. There is no argument about it, unless one takes the view that 20s. in the £ of a man's income is the State's entitlement.

We heard some very odd arithmetic from the right hon. Member for Grimsby (Mr. Crosland). I understood him to say that he was in favour of owner-occupation. He made the point that that has become 50 per cent. and more in recent years. He said also that he was in favour of extending rather than reducing the area of public ownership of housing. That is already 30 per cent. The remaining 20 per cent. is the most unlikely area from which new owner-occupiers will come. I refer, of course, to the privately rented sector.

From where is the right hon. Gentleman's new owner-occupier sector to come, unless it is from precisely the source which he criticised my right hon. Friend for suggesting, from those better-off council tenants who move out when they are faced with paying fair rents? Some peculiar arithmetic has gone into the right hon. Gentleman's calculations.

Looking at the White Paper, I do not think that anyone should be surprised or ashamed that, after a quarter of a century of being essentially on the same tack and not solving the problems, a Government should have come forward with a radical new suggestion. Whatever criticisms even Shelter makes of our proposals—and it has many—it says : We welcome the Government's initiative in producing the most radical proposals for housing reform made this century. Regardless of its criticisms, Shelter recognises that this is a step which previous Governments have not had the courage to take.

Right hon. and hon. Gentlemen opposite apparently do not agree. I cannot understand their attitude. Is it that they had a wonderful scheme to solve the problem which they kept secret, like the wonderful terms which they might have got in some other negotiations which went on and which are still topical. Alternatively, did they intend pumping in more and more money, without any thought of when it should stop?

In the last quarter of a century, we have seen a massive shift into owner-occupation. That is wholly to the good. However, the White Paper does not acknowledge sufficiently the difficulties that we shall face if we are to get any further along that road. Fifty per cent. leaves us with the most difficult 50 per cent. to get into owner-occupation. High interest rates, high urban land values——

Photo of Mr Norman Tebbit Mr Norman Tebbit , Epping

—and the high cost of housing generally will make it more and more difficult to cut into that other half. It may be that in future it will be more and not less difficult to get that 50 per cent. increased. Possibly it will be more difficult for young married couples to get on to the happy escalator for the owner-occupier of rising house values and away from the perils of rising rents.

The background to the White Paper is a mixed one. As I have said before, I find it hard to accept that, 25 years after the end of the war, during which time our standard of living has improved immeasurably in terms of washing machines, detergents, cars, holidays abroad, television sets, and crinkle-cut frozen chipped potatoes instead of the old-fashioned things with skins, we were still not meeting our housing needs. There must have been something wrong for us to have failed in that way. The only possible conclusion is that we did not face the fact that price control is essentially harmful in the long run even to those whom it seeks to protect. The same applies to wage control. I am glad that right hon. and hon. Gentlemen opposite have at least come to accept half of that philosophy, even if they do not agree with the whole of it.

I see nothing wrong in principle with the Government seeking to keep down the cost of the commodity. That is a proper thing for them to do. Nor do I see anything wrong in principle in their intervening to ensure that people can afford the commodity—rent, in this case. I must emphasise that I said "keeping down the cost" and not the price, because if we had continued on the path of keeping down the price whilst the cost was rising, we would have gone further into the old Socialist morass of shortage, of queues and of rationing in any commodity, and that includes housing. The most favourable thing about the White Paper is that the Government recognise it, almost all the Press recognise it, and some right hon. Members opposite, even if not all their back benchers, recognise it.

I welcome the White Paper because it faces reality. On one council estate that I know well, there are treated exactly the same, tenants who are belly-aching because the council would not put in a new colour television aerial, and tenants who cannot afford to pay their rents because the rent rebate scheme is not adequate. If that is the nature of the priorities we are told that Socialism is about, it is not my language of priorities that there should be subsidy for colour television watchers while, in the same borough, there can be no subsidies for those who have nothing to watch except the mould creeping up the wallpaper.

The White Paper moves towards subsidies for the private tenants. If it does bring some benefit to the private landlord, is that too much for hon. Members opposite to swallow? Is it too much for them to face the fact that a private landlord may gain some benefit in order that his tenant should also gain benefit? It is not too much for me to face. The White Paper will bring the realisation, when it becomes legislation, that the pri- orities within a man's wage packet must by food, clothing and a roof over his family's head and that these priorities must be equal. He must be given help in the same way if he is in difficulties regardless of where in the country he lives or who his landlord is.

Finally, I give two cheers only and not three to the White Paper for directing the help to areas in greatest need, because I am not sure that it goes far enough in that direction. I disagree totally with the right hon. Member for Grimsby. If the housing account is in surplus in one area, if that local authority is not in an area of great housing need, I see nothing wrong in taking money from there and transferring it through the Exchequer to areas which are in housing need, or in using it for bigger slum clearance subsidies. That is a laudable intent. But I give only two cheers because I think that the White Paper does not go quite far enough in recognising that we face a national problem.

I understand that about 18 per cent. of householders now receive rate rebate. It seems that 20 per cent. or more may receive some form of rent rebate or allowance. If we live in a country where that proportion of our people cannot afford the going rate for the roofs over their heads, it is not a local problem and not only a housing problem—it is a much deeper problem than that. I believe, that although it is focused on the areas in our great cities, this is such a national problem that we should regard it as being of the utmost priority to solve.

So far, we have managed to hide it away. I believe that the White Paper brings it out. I only regret that the Opposition intend to vote against the White Paper. If they do, they vote against the principle of greater help for slum clearance, of greater help to the poorest tenants, and in favour still of smearing subsidy right across the board without regard to true need.

8.25 p.m.

Photo of Mr Arthur Blenkinsop Mr Arthur Blenkinsop , South Shields

The hon. Member for Epping (Mr. Tebbit) apparently approves of the principle of taking still further powers away from local authorities. That is one thing that is very clear about the White Paper. Even if a lot of its appendices and other parts are extremely difficult to follow, it is perfectly clear that local authorities are to have little or not initiative left in their hands. From a party that claimed always—certainly at the time of the Election—that it would transfer powers to local authorities, this seems an extraordinary thing to do. Not only are the Government imposing a national rent rebate scheme which local authorities will have to adopt, but they are even taking, in effect, the power of rent determination from the hands of local authorities as well as taking away part at least of such surpluses as an authority may be able to get out of the new exhorbitant rents it will be charging. So in all these ways the local authorities are losing power.

The most unsatisfactory thing about the White Paper is that it is so superficial. It is very like the speech made by the Secretary of Stale today. A fair example of this is the assumption that ran through his speech and has run through the speeches of hon. Members opposite—that every council tenant is, in effect, a recipient of subsidies. Yet it is commonplace, in London in particular, that many tenants of older properties are heavily subsidising other tenants. They are the sufferers in that sense. It is far from true to claim that every council tenant is benefiting from a general subsidy.

Why should we assume, as the White Paper does, that a general subsidy in housing is automatically evil? It is described as indiscriminate. But many other subsidies which all of us have come to accept are indiscriminate in this sense. I reject entirely the idea that remissions in tax in effect are not subsidies in form. They are withdrawing a charge which otherwise would have to be met. Let us take as an example direct grants. I had some share in introducing improvement grants in the first place. They are indiscriminate in this sense. We do not attempt to impose an income test for them. One could even say that in some respects the owners of lordly mansions, some belted earls, are in receipt of grants in order to maintain their properties. I thoroughly approve of such grants. But they are not subjected to a means test in this form. Many of the agricultural subsidies which we have come to accept are not based upon the assumption of means testing. Why do we pick out the council house tenant as though he were some special kind of person and regard the subsidies which he enjoys as indiscriminate and classify them in this special way? That shows the class bias of so many Conservative Members which is instinctive—it pours out in this way without special thought.

We should not simply discard the idea of a general housing subsidy, although it is true that, as with every form of general subsidy, it should be fully justified ; but it is in the general public interest to ensure a high level of the public building of houses. This meets a general social need, and that is why there is still justification for the retention of some element of general subsidy, even though we may argue about its extent and the way in which we try to concentrate special help in special areas. I regard the White Paper's argument as superficial, which was how I regarded the Secretary of State's speech.

I will quickly insert one word of praise, but it is about the only one. I am glad of the announcement that we are to get rid of the Small Tenement Recovery Act, 1838. I am glad of it for a constituency reason. It is that a Conservative council in my constituency has insisted on using it in order to evict certain tenants, and the use of that Act does not give tenants the right to a hearing, or the opportunity to rebut charges which are not fully explained.

I go a little further. I should like the Secretary of State to take the modest further action of drawing the attention of local authorities to this proposal, asking them in the interim not to make further use of that Act, but to ensure that such cases may go to the county court where the tenants at least have a better chance of being able to argue their case.

I return to my major criticism, which is that the main effect of these proposals is unconscionably to raise the rents of many people whom the Government are asking to restrain their wage demands. What could be more crazy than these proposals at this moment? It is on that basis that most people will judge the White Paper and the forthcoming Bill.

8.33 p.m.

Photo of Mr William Benyon Mr William Benyon , Buckingham

I warmly welcome the White Paper. This is a series of reforms long overdue. What depresses me, particularly after listening to the debate, is the attitude of the Opposition. I have to remind myself when we hear their gloomy forebodings about the high levels of rents to be charged that these are the fair rents introduced by the Labour Government. Hon. Members opposite suggest that there is some difference between the fair rent system as applied to private tenants and that applied to tenants in the public sector. I find that attitude hard to understand, particularly as these proposals constitute one of the main points in our last election manifesto.

The hon. Member for Romford (Mr. Leonard) suggested that paragraph 32 of the White Paper meant the tenant in a public sector house would have no hand in the fixing of a fair rent. I cannot believe that the hon. Gentleman has read that paragraph fully, because it is plain that the tenant will come into it and will be able to make representations.

I had thought, I suppose rather naively, that we were approaching a bi-partisan attitude on the subject of housing, with the fair rent proposals of the Labour Government, the particular responsibility of the right hon. Member for Coventry, East (Mr. Crossman), about which we have heard so much, and the general acknowledgement on this side of the House that in areas of high housing stress the operation of market forces could not be relied upon if social justice were to be obtained. Above all, on all sides of the House there is a great realisation that housing is essentially a long-term business. Unless we have the confidence of all parties to the equation—tenants, landlords, owner-occupiers, local authorities and housing associations—we shall not get the full answer which we all want, namely, better housing conditions for our people.

I am prepared to regard pragmatically any suggestion which would increase this confidence for the future. There is a certain amount of justification in the remarks made today on the subject of furnished tenancies. I would be prepared to look at this again provided that houses where the owner lives on the premises would be excluded from any such provision.

In return I would ask for a commitment by the Opposition to encourage private finance for housing for rent. It is one of the facts of life, because housing is such a long-term business, that unless there is a bipartisan approach we shall not have any success. The Greve Report has shown that steadily the private rented sector has been whittled away. The reason is that there is a lack of confidence among those concerned. If we do not have that confidence then we fall back on local authorities and housing associations. This must be a second best solution in view of the size of the problem.

Two further points have emerged and I hope that they will be dealt with in the wind-up. The first concerns my own constituency where we are faced with starting the first new city to be built in this country—Milton Keynes. Here we are starting from scratch on a green-fields site at a time of rising house prices and rising building costs. We shall be in a difficult position in obtaining what the Government want us to obtain, a 50 per cent. balance between corporation and private housing for rent and sale.

I hope that the cost limits mentioned in this White Paper for the provision of rent rebate will be flexible and that the Government will look at this point in such situations.

I turn to slum clearance. There is a gap here in that the most rewarding expenditure which the Government could make is finance to extinguish industrial consents in areas of high housing stress. It is no good having a policy of relocating industry—and I am speaking particularly of London—when the vacated premises are immediately reoccupied by other industrial concerns which continue to produce the same employment opportunities and thus the housing stress which we are seeking to remedy. The Government ought to consider giving greater assistance to authorities like London to extinguish these industrial consents in favour of house building.

I warmly welcome the White Paper. If we can obtain, as a result of this, a feeling of confidence among all the parties engaged in this housing operation the position will be immediately and quickly improved.

8.39 p.m.

Photo of Gerald Kaufman Gerald Kaufman , Manchester Ardwick

I am very grateful for the opportunity to speak in this debate because this White Paper affects more than 60 per cent. of my constituents. The effect will be major, overwhelmingly it will be damaging, and in some cases it will be devastating. The veneer of presentation of the White Paper has been smooth and ingratiating. The Secretary of State began with an emollient anthology of Press quotations. The title of the White Paper aims to please—" Fair Deal for Housing". But the game is given away in Appendix I under the very deceptive heading Proposed Formula for the Transition to Fair Rents". If one looks below the heading one comes to the meat. Paragraph 2 says that the local authority … will be required to make … a further general rent increase … Paragraph 3 says … the local authority … will be required to increase rents … Paragraph 4 says that … the local authority … will be required to make a rent increase … This is not a fair rents White Paper ; it is a rents increase White Paper and, what is more, a rent increase of at least 50p a week White Paper. The Minister's slogan for it should be, "Pay your rent increase now and hope for a rebate later". It is damaging in both the private sector and the public sector. In the private sector all rents are to go out of control by January, 1976, and the rents are to go up by, to use the Government's favourite formula—and I quote from the White Paper— … not less than 50p per week". Moreover, as my hon. Friend the Member for Salford, East (Mr. Allaun) mentioned, the landlord will be in a position to intimidate the tenant into accepting the new rent he wishes. The rent officer need never be consulted about what the rent should be. The acceptance by the Government of the Francis Committee's recommendation mentioned in paragraph 25 gives the landlord the opportunity to fix a rent privately with a tenant, and many tenants who are unaware of their rights and who wrongly fear for their security of tenure will accept whatever the landlord proposes.

This can go in indefinitely, because the White Paper states on page 7 : When a rent has been registered at least three years, and the parties agree on a new rent, they can apply jointly to the Rent Officer for cancellation of the registration". It says "can apply jointly", not "must apply jointly". In many cases they will not apply jointly and the landlord will get away with the rent that he wishes to impose on the tenant. The tenants who have most access to advice and who can understand advice best will be all right. But it is the tenants with least access to advice who most need it and it is they who will be most vulnerable. Even under present legislation, I can quote from my constituency an example of an attempt to exploit a defenceless tenant in this situation. That is what could and what will happen in the private sector.

In the public sector we have a prescription for ever-escalating rents because the Government clearly look forward to most rents going up, otherwise there is no meaning in the first sentence of paragraph 36 of the White Paper which states : The rents of most council dwellings are at present less than the fair rent". This must mean that the rent of most council dwellings will go up, and the Government wish it to go up. What is more the Government insist in paragraph 37 that the rent must go up by an average of 50p even if no fair rent has been determined, because their concept, under the White Paper, of a fair rent is a high rent—in fact, not just a high rent but an escalating rent. One does not simply, under the White Paper, establish a fair rent and that is the end of the matter. A new fair rent is to be established for local authority dwellings every three years. Therefore, instead of stabilising the rent situation, the White Paper introduces the new concept of the rent spiral.

Photo of Mr James Allason Mr James Allason , Hemel Hempstead

Can the hon. Gentleman explain how the Government's proposals differ from the Socialists' fair rent scheme of 1965?

Photo of Gerald Kaufman Gerald Kaufman , Manchester Ardwick

My right hon. Friend the Member for Grimsby (Mr. Crosland) explained in great detail the difference between fair rents in the public sector and fair rents in the private sector, and, as other hon. Members wish to speak, I do not wish to repeat what he said. I recommend the hon. Gentleman to read it in the OFFICIAL REPORT tomorrow.

Photo of Gerald Kaufman Gerald Kaufman , Manchester Ardwick

As I have said, we have a situation in which rents go up, but we are told there is to be a rebate or allowance and that that will make all the difference. First one has to catch one's rebate, and Appendix 2 gives the game away here. In what we are told is to be a national, comprehensive all-embracing scheme, one would think that, involving as it does almost eight million tenancies, the rebate would be automatic, that the local authority would take the initiative and ensure that the rebate would be paid. But no, it is the tenant who must apply. What is more the tenant does not have to apply only once. He has to reapply—and not just regularly ; but he has to reapply constantly, because the rebate lapses after only six months.

What a burden this is to the tenant, checking up whether his time limit has expired, trying to understand all the forms which he has to fill in. What a bureacracy to impose on the housing management office, an office which, certainly in a large city like Manchester, is burdened and over-burdened with allocations, transfers and exchanges.

How many tenants will ever make the first application? The White Paper boasts about the publicity which there will be, but there has been massive publicity for the family income supplement and it has resulted in a pathetic take up. What is more, these very people at whom family income supplement is aimed, and who have been so slow and reluctant to apply for it, are the very people who will be in the most need for rebates and allowances under this White Paper.

In any case, can this publicity which the Government are issuing, and about which they boast, be trusted? The Government give examples, give tables, of the rebates and allowances which there will be. My hon. Friend the Member for Salford, East has already pointed out that these are not examples of rebates on present rents but examples of rebates on notional fair rents. In any case, even with the tables, and even accepting that they are notional fair rents, all kinds of provisos are introduced. We are told in Appendix 2 about one person, a man and his wife, a man and his wife and one child, a man and his wife with two children, but paragraph 12 on the previous page says : The following tables illustrate the effect of the model provisions for the calculation of rebates and allowances set out in paragraph 2 of this Appendix in the case of households in which the tenant's wife is not working, any children are dependent children of the tenant or his wife and there are no adults other than the tenant and his wife. In fact the application will be complicated and the conditions will be difficult to understand. The situation will be as baffling to the potential applicants for these rebates and allowances as are the qualification tables for social benefits which have been recently published and which some hon. Members have pointed out would render a private concern which put them out liable to prosecution under the Trade Descriptions Act. These tables which the Government are publishing are likely to lead to as bitter disappointment for applicants as are the tables of social benefits to which I have referred.

What is clear is that the average family man will have to be earning well below average earnings, or he will have to be in a house with a very high "fair" rent, if he is to get a rebate which he will notice at all. It is absolutely contrary to what the hon. Member for Dartford (Mr. Trew) said, and if he looks at these tables he will find, as they are stated here, how little the man on average earnings gets.

This Government are once again—as they have with relish so often since they came to power—hitting at the average breadwinner and his family. This White Paper will increase rents at a stroke and will go on increasing them regularly at a stroke. There is not a majority in the House at present to reject the White Paper, but the people will reject it as soon as the Government dare to give them the chance.

8.50 p.m.

Photo of Mr James Hill Mr James Hill , Southampton, Test

This has been a sad day for the Opposition. They have had two major body blows. The first that I dare mention was the mini-Budget, of which I shall say no more, and the second is the Government's first-class housing proposals, for which we on this side have waited so long.

I remember asking my right hon. Friend to consider the phasing of fair rents almost 12 months ago. This is to be in the legislation. Anyone who has had experience of local authority housing work will realise the outcry that has come from the private sector at the inequality that it has always felt and the creation of two separate nations in the rented areas. The silly stories of people in council housing earning £200 a week and having a Jaguar outside the door are the sort of things which have been built up in malice. Certainly, the Government's legislation will for the first time correct this inequality.

Fear has been expressed today that there will be a low take-up of this offer. My view is that there will be a low take-up if we get the dreary, dismal picture that radiates from hon. Members opposite. The hon. Member for Manchester, Ardwick (Mr. Kaufman) said that the proposed rent rebates are hardly worth bothering about and that one has to look for the hidden snags. The table is perfectly easy to read.

It is just as well that we give great prominence to this tonight. For a married man with three children who earns £20 a week and pays £4 rent, the weekly rebate will be £2.65. Over half of his rent will be paid for if he earns £20 a week. If he pays only £3 a week rent, his rebate will be £2.05. I see no reason why we on this side should be ashamed of those figures. If that same man pays £5 a week rent, he will get £3.25 back. These are things to be proud of.

We have heard tonight of people already in a very poor financial state living in council accommodation. In the past, the main feeling that I have had in a constituency which is divided almost 50–50 between public and private dwellings has been that the private sector has always felt neglected.

One of the benefits of the Government legislation is that it will encourage the developer to start building flats and maisonettes to rent. If he can get a fair rent figure before he starts building, there is no reason to suppose that the private landlord, developer or builder will shy away from building for rent. This, surely, is the type of accommodation of which we are desperately short.

Earlier in the debate, the right hon. Member for Grimsby (Mr. Crosland) made one of the finest cases I have ever heard for the selling of council houses. He went on to say that owner-occupiers were much better off ; they had the benefit of tax relief, they had the equity in the building and they were free of all restrictions. He was fully for owner-occupation. I wish that he would repeat this to Labour-controlled councils. That is not how they see it, and I sincerely hope that this radiating light from the right hon. Gentleman will continue to radiate to the local councils.

The rate of council building has been mentioned. I venture a guess that if a local authority can balance its housing revenue account, as it will under this scheme, and have a healthy surplus, which obviously must go back to the Exchequer, more funds will be available for further building. I know that in the Inner London area a great deal of rate subsidy is given to the housing revenue account which will not be necessary in future. In Southampton, council house rents are subsidised by £140,000 a year. This will not be necessary in future. These are the little hidden benefits that should be brought out. I thoroughly welcome, as my hon. Friends do, this White Paper. It has been needed for a long time, and it is the beginning of a new structure for our housing.

8.56 p.m.

Photo of Mr Bruce Douglas-Mann Mr Bruce Douglas-Mann , Kensington North

In the few moments I have I will deal only with one major issue which I hoped that hon. Members opposite might have mentioned. On the basis of figures recently supplied to me in answer to a question, the average subsidy to the owner-occupier is £60 and the subsidy to council tenants, Exchequer and rate subsidy combined averages £39.

The most desperately deprived section of our population, the tenants in furnished accommodation, are left unaffected by the White Paper. I asked the Minister on Thursday why furnished tenants were not given protection. He said—I think he will now accept mistakenly—that the total stock of housing was liable to decline by reason of the extension of protection under the Rent Acts. The Minister referred to page 212 of the Greve Report, which did not conclude that at all.

I have now obtained the figures which show the measure of the decline in privately-rented housing stock from 1951 to date. If the Minister will look at page 80 of the Francis Committee Report, he will see that these figures, if plotted out on a graph, show that the decline has been steady from 1951 onwards and that the one period in which there was a more rapid increase in the rate of decline was in 1957 when decontrol came into effect. From 1961, through 1966 to 1969 and 1970, the decline is on virtually a straight line.

I am seeking to deal with the crucial argument put forward by the Francis Committee Report against extending the security of tenure of furnished tenants, which was the fear that landlords would cease to let if furnished tenants were given security of tenure. It is a necessary ingredient of furnished tenants getting the benefit of the rent rebate scheme that they be given security of tenure and have fair rents. To be paying out subsidies to private tenants with no control over the level of rents would be pouring public money into the pockets of the landlords. I do not think that even hon. Gentlemen opposite would wish to do this, although they clearly favour some forms of indiscriminate subsidy.

There is no justification for believing that there would be any substantial decline in the number of houses offered to let privately if furnished tenants were given protection. If we look at the stock of furnished tenancies, we find that only 11 per cent. consist of self-contained flats, and these are profitably to let and there is no reason to suppose that they will be withdrawn from the market. Some 42 per cent. are flats in conversions, which are exceedingly difficult to mortgage and to use in any way other than by letting. The remaining 46 per cent. are rooms, which are impossible to sell.

I urge the Minister to look again at the arguments in the minority report of the Francis Committee. The Minister is aware, as has been made clear by the speech of the Under-Secretary of State over the weekend, that there is in the Ministry a great deal of sympathy towards furnished tenants and the recognition that they are the most deprived. According to the Francis Report, in London the average rent of furnished tenants is £290 a year and the average income of such tenants is £870 a year. They have no security of tenure ; and when the Francis Committee followed up 100 rent tribunal cases a year later, it could find only 20 of them, 15 of whom were under notice to quit or seeking to leave.

These are the families who are the most deprived. The Government's measures will do nothing to safeguard those people, and the Government's reasons for not taking any action in respect of those people are based on a fallacy. If it is only by allowing these families to be exploited that the private landlord system can be made to work, it is an overwhelmingly strong argument for abolishing the private landlord system.

9.2 p.m.

Photo of Mr Reginald Freeson Mr Reginald Freeson , Willesden East

As I see the situation, broadly speaking, there are five tests to be applied to any proposals which are put before the House and the country on housing finance, rent policy and related matters dealt with in the White Paper. I do not wish to resist change ; a number of aunt sallies have been put up in this debate just to be knocked down. We are not disputing the need to look at the legislative position and at the financial situation in regard to housing from time to time and to make changes where necessary. Nor are we disputing the need for some basic changes. We would not have undertaken the extensive studies on which we embarked during our term of office had we believed that things were satisfactory and should continue in that way for ever. We feel there is a need to apply certain tests, which are as follows :

First, do the proposals outlined in the White Paper seek to identify those costs attributable to the provision of the accommodation of tenants and fix standard rents accordingly. Secondly, do the proposals identify those other costs in urban development and urban renewal which the community decides to pursue in order that these matters should be covered by the community's own provision? Thirdly, do the proposals or any policy flowing from them examine what general help should be given in equity as between all forms of tenure in the community? Fourthly, do the proposals for the policy document putting them forward identify housing objectives, such as the need for new building, slum clearance, housing improvements and urban renewal generally, and evaluate investment needs over a given span of years ahead? Fifthly and lastly, do the proposals contribute towards stabilising costs without damage to the policies which are required in urban development and urban renewal, particularly in the major city conurbations?

On every one of those five grounds this White Paper falls down. I find the White Paper obscure and in many respects somewhat slipshod. In so far as it derives from some sound ideas about positive discrimination in social policy—and I do not deny there are some sound ideas buried in the White Paper—they have been largely bastardised by the obsession on the part of the Government and the Conservative Party over what they call "fair rents" but which, in effect, are market rents. They also result from the kind of schizophrenic pressures inside the Conservative Party which on the one hand recognise the problems, as the right hon. Gentleman certainly does, which face us in our big cities, but, on the other hand and at the same time, opt out of Government involvement in major areas of social policy in spite of a crying need for much greater public enterprise and community involvement in housing.

Some references in the White Paper clearly show seriously slipshod thinking in arriving at the conclusions reached. For instance, quite early on we have the statement that nothing less than the proposals outlined in the White Paper … will create the conditions for a final assault on the slums … I should very much like to learn from the Minister—these are his words—what precisely is in the mind of his right hon. Friend and of himself when they choose this terminology. Do they mean that they intend to clear the slums, as far as humanly possible, allowing for ups and downs, possible errors and failures—and I do not say that in any critical sense—or is it their intention to seek to clear our slums through local authorities and other agencies during the course of the next five, seven or 10 years, or whatever period one wishes to name? I do not put this in any flippant or light-hearted spirit. If we are to use language like this as a justification for these proposals, that language should mean some- thing and should be defined. We should know what is in the Minister's mind and in the Government's mind.

We have heard before about this assault on the slums, and the rest. We had it in 1955 from the previous Conservative Government, when they declared a new slum clearance drive and in the following year dropped housing construction by local authorities by about 53,000 dwellings—a decline which continued until 1964, an election year, when the numbers began to increase again. When we see this language used we should be told to what the Government are committing themselves as a programme. The document tells us nothing about that. If the Government mean anything by these words, they should tell us, otherwise we can only assume that it is fine rhetoric and nothing more.

The White Paper makes questionable assertions on major aspects of the effects on the housing situation which it is important should be dealt with. Several of them have been touched on in the debate. There is no doubt in my mind that some of these questionable assertions about effects lead to some equally questionable conclusions by hon. Members opposite and by members of the Government.

The first of these assertions appears—and I mention this just in passing and would like an explanation—in page 1 of the White Paper, and refers to 2 million dwellings being substandard. That is the first time I have seen that figure in an official document. Up to now in all official documents and statements we have, since the National Condition of Property Survey of 1967 was undertaken, accepted the figure as being between 4 million and 4½ million. The White Paper says that there are 2 million. May we be told what calculations inside the Department led to a more than halving of the figure of obsolescent and substandard houses? This information is very important to our future housing policy. On page 2 it is said that 90 per cent. of the £220 million Exchequer and rate subsidies is being used to reduce the general level of rent. This has been argued time and again, and not for the first time in the House today. This is a popular misconception which I can only assume is being deliberately encouraged by the Government perpetuating it in the White Paper.

We do not know the proportion of tenants who, so far from being subsidised, are paying a profit rental to local authorities, but we do know that it is very large. I speak with some knowledge, as a one-time chairman of a finance committee in an area of housing stress with a big building programme. Subsidies are pooled, just like most rents are pooled, by local authorities, and 90 per cent. of them go towards stabilising the rents of recently built expensive property. It is probably the case that, apart from individual rebates because of low family incomes, there are no tenants of properties built before 1960 receiving any subsidy. It is about time to some of the nonsense we hear about general subsidies on bricks and mortar instead of on individuals was dropped. It has gone on far too long and it leads to seriously mistaken policies.

The general levels of rents in local authority estates have been stabilised, kept down, or reduced over the years, especially during the last 20 years, mainly by rent pooling, so that tenants of older, more cheaply built houses provide a profit rent to cross subsidise their fellow tenants in more costly but otherwise equivalent property. This is a central point about the local government administration of housing estates. In a White Paper discussing these matters, it appals me that that is not mentioned once, despite the fact that it lies at the centre of practically every local authority's conduct in operating housing estates.

It is about time that we got rid of this illusion of indiscriminate subsidies on bricks and mortar. With the departmental information at their command, it is inexcusable that Ministers should deliberately foster this socially divisive prejudice.

I turn to another point specifically stated in the White Paper on page 2. Here we are given, as one of the main reasons for the Government policy outlined in the rest of the White Paper, the fact that historic accidents have determined each local authority's housing stock, so that An authority which built most of its houses when costs were much lower can balance its Housing Revenue Account by charging rents far below the present value of its houses. But an authority which has had to build most of its houses recently may be obliged to charge much higher rents for houses of similar quality. The simple answer to this in principle, no matter what details of application the Government could adopt, is to extend the principle of rent pooling on a cost basis over large areas such as the Greater London area and the new local authority areas which are to come into existence under local government reform.

In connection with the owner-occupier aspect, it is astounding that nowhere in the White Paper is there any reference to the £300 million a year subsidy by way of tax relief. I cannot see how one can discuss, study and make recommendations upon the equitable provision of financial assistance for housing, to whatever group of tenants, or owner-occupiers or to whatever families, without looking at the total picture and drawing certain conclusions from it. But the figure is not even mentioned.

The White Paper suggests, rightly, that the £220 million currently provided by way of Exchequer and rate subsidies does not produce the new building required in the municipal areas. That was stating the obvious. It was not a reason for the changes proposed but an aunt sally put up to be knocked down. No subsidies, as such, provide the dwellings required. They are contributions and incentives, but they do not provide the dwellings.

The major issue here as regards future building in the public sector is that of capital investment. This issue is not even touched on in the White Paper. There is no discussion of this fundamental and central aspect of future housing policy in the public sector. Without that discussion, without proposals and intentions in this direction, we cannot know in what way the problems of urban renewal in cities—the major problems which lie at the heart of all our housing problems—will be solved.

Several hon. Members opposite have said that one of their reasons for supporting the so-called fair rents provision of the White Paper is that it will make more resources available for housing. I believe that the Minister has got into the habit of saying this around the country and once or twice in the House. The only way in which to make more resources available for new housing is by increased capital investment.

If time permits I will return to this question before concluding, because we are entitled to some clear ideas and answers from the Government on this central issue of housing finance for the future.

Much has been said about changing the position in the private sector as well as dealing with the issues of municipal housing by way of the White Paper. The only argument which is posed in the White Paper for increasing the speed at which controlled dwellings will be decontrolled is that there have been only just under 4,000 controlled dwellings improved under the 1969 Act.

I do not question that figure, but it bears about the same proportion to the total number of old rented properties improved, which I understand is about 50,000, as the number of controlled properties to the total of substandard. Therefore, the only argument which is used in the White Paper is false. It is playing around with figures without looking at the full picture. Therefore, the argument which is put forward on the score of speeding up the process of rent increases in controlled dwellings is invalid.

We are told that we must have the fair rent system to introduce some kind of rational overall picture—a fair picture—into municipal housing. The White Paper says : Many of the existing evils—unfairness between one citizen and another, neglect of people in need, dilapidation of property, waste of resources—are caused by the absence of any consistent principle underlying the pattern of rents. No doubt there is a need for a review, but that is glib over-simplification. There is no reference there to the position of owner-occupiers—not only owner-occupiers as compared with municipal tenants, but one group of owner-occupiers as compared with another : the more well-to-do as compared with the lower paid, the large mortgagee as compared with the small. The larger, the bigger the benefit. The smaller, the less the benefit. There is no discussion of this question.

The major cause of all the evils referred to in the White Paper is the basic one of lack of housing, of inadequate investment—under whatever Government—and inadequate organisation to deal with the major problems in city centres. These are the real issues that count and fair rents which are not fair rents in the public sector—not fair rents in the true sense of the word—are not the answer to these issues, which are not touched on in the White Paper. A fair return on cost is the only fair rent and it is also anti-inflationary. That is not what the Government have sought to adopt either in the private or the public sector. The White Paper states : The rent of every council dwelling will in future reflect its value by reference to its character, location, amenities and state of repair, but disregarding the value due to any local shortage of similar accommodation. Nowhere is there mention of the cost of providing the dwelling, maintaining it and managing it. This would be the right approach if one wanted to maintain not only fair rents but an anti-inflationary policy—and I mean fair rents according to the proper descriptive term that I am using and not according to false label applied in this context.

If I am wrong in suggesting that this is the area which requires further examination, may we be told specifically why is this the intention of the Government in the White Paper "The Reform of Housing Finance in Scotland"? Paragraph 13 sets it out : The pooling of costs over the whole of an authority's housing stock, together with the freedom to fix individual rents, should ensure that tenants do not pay a higher rent than is justified by the quality of the houses they occupy. If that is correct in the context of that document which has just been published by the Government, why is it not correct as a basis of policy in the document that is before us today? We are entitled to an explanation why pooled historic cost rents are sound in Scotland, apparently, but are not to be applied in England and Wales. We are entitled to have an answer from the Government who have produced these contradictory policies.

There is no doubt that it is inflationary to adopt the market rent principle in England and Wales. It is intended to exclude the tenants of municipal properties from any kind of financial assistance but to place upon them the burden of paying in greater and greater proportions over the years for all the urban renewal needs and rent rebate needs that are set down in the White Paper. It is quite clear what is intended here if one reads the small print and if one reads between the lines. It is intended that tenants shall be paying an increasing proportion of the rent rebates and rent allowances to other tenants and that they shall also be paying, by way of repayment of surpluses to the Exchequer, large sums of money which will then be used to assist the areas in need. But the issue is not, as one hon. Member opposite suggested, that this would be in addition to the present levels of expenditure. That is not what has been put to us. What has been put to us is that there shall be a holding back of Government spending, whereas there shall be an increase in the rents charged to tenants and a taking up of surpluses.

We are also entitled in this connection to know the answers to certain specific questions which have been put in exchanges in this House and which have been put publicly—answers which I am certain are in the Department. First, what is the estimated profit to housing revenue accounts in this country when the so-called fair rent system comes fully into operation? At least one figure has been quoted in the Department of over £300 million per year surplus—profit—on the housing revenue accounts of the country. It has been suggested by responsible sources, for instance, from members of the Institute of Municipal Treasurers, who have studied these matters carefully, as they have to, that that could rise to a profit of £500 million a year.

Are those estimates correct? May we be told what justification there is, apart from mere assertion in the White Paper, for taking this surplus from tenants' rents and putting it into the Exchequer in order to reduce the community's burden of costs in urban renewal and slum clearance?

Further, arising from one or two specific points made by Government back benchers in support of the White Paper policy, whether it is intended to increase capital investment in public sector housing by the extent to which there is a surplus drawn by the Exchequer from local authorities under the new rents system?

Photo of Mr John Biggs-Davison Mr John Biggs-Davison , Chigwell

And the same for new towns?

Photo of Mr Reginald Freeson Mr Reginald Freeson , Willesden East

I say "any". Will what the Government draw by way of surplus on housing revenue accounts, or correspondingly in the new town structure, be added to the present level of investment in housing? I regard this question as central to the whole future of housing policy.

According to the Government's housing statistics published in May, 1971, investment is currently running at a level approaching £800 million a year. To be precise, for 1970 it was £771 million gross fixed capital formation in housing in the public sector. In real terms, that is, at constant prices based on 1963, it is £586 million, which shows a fall back. I just mention that to put the matter in perspective. The current figure is £771 million.

If there is to be a surplus of between £300 million and £500 million on housing revenue accounts as a result of the Government's market rent policies, may we have an undertaking, in the spirit of observations made by their own supporters, that that will be the increase of capital investment in public sector housing to which we may look forward on the introduction of the so-called fair rents system?

I do not believe that such an undertaking will be given, but, if it is not, the whole argument put by certain hon. Memberts opposite who wish to see greater resources directed to that end—the hon. Member for Northants, South (Mr. Arthur Jones) made this a central point in his short speech—is vitiated.

We on this side strongly oppose the idea of introducing market rents into a non-market sector of housing. If there be a need to reconcile the differences between a cost-rent policy, to give it a short name, and that which operates in the private sector under the Rent Act, the necessary change should be made by a closer and tighter definition, if circumstances warrant, of fair rents to relate them more closely to the cost of production and a fair return.

The main issue here is whether the White Paper contributes to fairness among all groups of tenure in the country. The plain answer is that it does not. Second, does it contribute to an increase of capital investment resources to deal, primarily, with our city centre problems? Again, the answer is, "No". For those and the other reasons which I have stated, we shall vote against it. It is a shoddy document. It should not have been put to the House in the way it has.

It should have been put forward after much further thought to other major missing elements in the housing finance review which led to it. I have indicated that one major missing element is the discussion and consideration of expanding investment and ensuring equity between all groups—owner-occupiers and tenants of all kinds—which this White Paper fails to do. It is a "conning" exercise, and little more.

9.30 p.m.

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

A number of hon. Members on both sides of the House have raised some detailed points in connection with our proposals, and my right hon. and hon. Friends will study them before the Second Reading of the proposed Bill. I hope to take account of all of them in the interval. I refer especially to the speeches of my hon. Friend the Member for Dartford (Mr. Trew) and the hon. Member for Romford (Mr. Leonard). Both raised points of some importance which I shall study.

Inevitably, not by our choice but by that of the Front Bench opposite, this has become rather a political debate. When my right hon. Friend published his White Paper last week, the Leader of the Opposition described our proposals as "facile" and "reactionary". I should be delighted to take lessons in facility from the right hon. Gentleman. However, I do not see that the charge of reaction can lie. If there were one reactionary contribution to today's debate, it was that from the hon. Member for Salford, East (Mr. Frank Allaun). He thinks that it is all very fine the way it is now. He says, "Let us go on with the system as it is, and let us put another shilling on the income tax to meet the growing bill for subsidies up to 1980."

The right hon. Member for Grimsby (Mr. Crosland) takes rather a different view. I got the impression that he wanted reform so long as it involved no change.

The hon. Member for Willesden, East (Mr. Freeson) appears to have opted for historic costs in the public sector. I was interested to hear that. If the hon. Gentleman is prepared to take the stand on historic costs and otherwise accepts our proposals, the difference between us is narrowed considerably. Reasonable people will say that this is a proper argument.

For the reasons set out in paragraph 6(4) of the White Paper, we think that historic costs will involve anomalies and injustices. The reason for adopting that approach in Scotland is that it is an interim measure because of the very big gap that exists between existing rents and possible fair rents in Scotland.

Photo of Mr Frank Allaun Mr Frank Allaun , Salford East

I am sure that the right hon. Gentleman does not wish to misrepresent what I said. He suggested that I did not want to see any change in the scheme. The contrary is true. I made it clear that there could be no objection to saying that some tenants should have more subsidy and that some should have less. What I object to is the vast reduction in the subsidy going to tenants. If it is reactionary to oppose the doubling of rents, which is what it will mean for millions of working-class families then I am a reactionary and so is nearly the whole of the Labour Party.

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

The hon. Gentleman is a reactionary in this matter, as is his party on a great many issues such as industrial relations and the Common Market. However, I shall not pursue that further.

I claim that our proposals are radical. That is how they were described by the Economist and New Society. New Society put it very well, saying that it was The first entirely logical approach to housing finance. That is what "radical" means. To use Lord Haldane's famous sentence, it is the application of first principles to political problems.

Not only are the proposals radical. They are formed by a sense of social justice. With that in mind, I come to the first objection which the right hon. Member for Grimsby put to us. He could see no logic in applying fair rents to council houses because, he said, these fair rents were not related to the original costs. Perhaps that brings him close to the hon. Member for Willesden, East in veering towards historic costs as a basic formula.

The trouble about both the right hon. Gentleman and the hon. Gentleman is that they are thinking in terms of the cost of building houses in terms of houses and not of people. They do not appreciate how unjust in terms of social justice the present system has become. It might be worth noting the right hon. Gentleman's suggestion that fair rents are not fair when applied to council houses. Why not? No doubt the people in privately rented accommodation will note that the Labour Party is still determined to subsidise one group of tenants, irrespective of need, at the expense of the other. Why should tenants have fair rents in the private sector but not in the public sector? Why in the public sector should the tenants of older houses have to contribute under the pooling arrangements to tenants of newer houses? It seems to me a totally unjust system.

This is where I come to the most astonishing statement which the right hon. Member made. He said that he objected to fair rents on social grounds. He said that it would mean confining council estates to the deserving poor—he used the phrase—instead of the undeserving better-off and—to be honest—he added, better tenants. This seems an odd idea. He is saying that we should subsidise the better-off people to live in council estates so as to raise the tone of the neighbourhood. If that is what he thinks, the remedy is in his own hands—sell off the council houses.

The White Paper's proposals will prevent council estates from becoming ghettos of poverty because where there is no acute shortage the introduction of rent allowances in the private sector will discourage tenants in the private sector from putting their names on the waiting list for council houses, and they will be able to remain in the private sector. Under our proposals, there will be a fair deal for both public and private sector tenants. The same rules will apply in both. The fair rents will relate to the quality of the houses in both and there will be rebates in both, related to need.

The right hon. Gentleman took a great deal of exception to the fact that our proposals involve a means test. He and other hon. Members opposite expressed noticeable anxiety about possible increases in the Civil Service that this would involve. Sir Waldron Smithers, had he still been with us, would have felt a good deal of sympathy with their criticism. But we are not prisoners of our ideology. In fact, I cannot quite see what he is getting at in his argument that the extension of the rebate system means the extension of a means test in a qualitative, as well as quantitative degree. He and Lord Greenwood, when he was Minister of Housing and Local Government, urged local authorities to extend the rebate system everywhere. Had the local authorities followed their advice, there would have been 100 per cent. means testing in the council estates.

What we are doing is to add the private sector to the list. I do not think that tenants of the private sector will complain at the chance of getting a subsidy. It is getting a bit late in the history of the Labour Party to try and produce this Pavlovian synthetic emotion about means tests. People have grown out of that. Already, so many people one way and another are means tested. It is strange that the right hon. Gentleman seems to think that this is what he calls a new departure of social policy. The right hon. Gentleman seems to think that it is all right to means test the poor, but not to means test those people who are not so poor : it is a strange doctrine.

The right hon. Gentleman described the rent increases which we are obliged to undertake as very large indeed.

Several Hon. Members:

Several Hon. Members rose——

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

I should like to give way, but I do not want to over-run my time. The hon. Gentleman said that we were not obliged to do so. If we are to develop the resources required to help the people and areas in need, it is necessary to raise the rents of those who are not in need.

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

The hon. Gentleman had a very good go earlier on.

Photo of Mr George Cunningham Mr George Cunningham , Islington South West

That is one way to win a point.

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

I have been in the House long enough to know that one does not win a point that way.

The right hon. Gentleman and several other hon. Members opposite attacked the increase in rents. The hon. Member for Manchester, Ardwick (Mr. Kaufman) talked about the beginning of a wage spiral. But many observers throughout the country find that the increase which we propose is less than they had expected. Is the Labour Party in a position to criticise? Under the Rent (Control of Increases) Act, 1969, the Labour Government authorised increases, without reference to the Ministry, of 7s. 6d., with a maximum of 10s. There is not such a large difference between that and what we are doing, but there is a big difference when what we are advocating is to be accompanied by universal rent rebates and allowances.

The hon. Member for Willesden, East talked about the phasing period in the private sector. It is true that the phasing period under the Labour Party was five years and that we have reduced it to three years, but those are three years accompanied by allowances and the Labour Party's scheme made no provision for allowances.

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

I am coming to that.

The right hon. Gentleman and others said much about fair rents and I got the impression that they would have liked us to extend our proposals to the furnished sector. To the extent that some Labour Members say that, it is a tribute to our proposals. I have much sympathy with the idea that these proposals should be extended to the furnished sector, but there are great difficulties. I think that it is four out of ten furnished dwellings which involve the sharing of facilities between landlord and tenant ; it is difficult to define the exact difference between letting and lodging ; it is difficult to reach a valuation of structure and furniture. The population dwelling in furnished accommodation is largely a floating population.

But we are still studying whether there is some way in which we may extend our proposals in the Bill to come in the autumn to the furnished sector, and, if there is, we should very much like to do so. Hon. Members opposite with great experience of housing matters tell me that they gave evidence to the Francis Committee to say that there should be full security of tenure, but they did nothing about the furnished sector in their 6½ years in power. However, we should welcome any suggestion from them about how our scheme, or any variant of it, could be applied to the furnished sector.

I come to tax relief and owner-occupiers. The right hon. Gentleman contrasted the position of owner-occupiers with that of tenants. Owner-occupiers are growing in number, growing by 50,000 a year and already occupy more than half the housing stock of the country. We hope to see more in years to come. We think that our proposals will help and if councils will sell their houses that, too, will help, as well as assisting in producing the social mix which the right hon. Gentleman is so anxious to see.

I would flatly repudiate the idea that we are favouring the owner-occupier as against the tenant. The 1969–70 figures estimated that housing subsidies and rale fund contributions cost £220 million a year. That is about £48 per year per local authority house. Tax relief on mortgage interest plus option mortgage subsidy amounted to £224 million in that year—£25 a year per owner-occupied house. The right hon. Member for Birmingham, Stechford (Mr. Roy Jenkins) reaffirmed the principle of tax relief on mortgage interest in his Finance Act last year, when he abolished tax relief on many other forms of loan interest but retained it for owner-occupiers. I hope that the right hon. Gentleman does not want to tell the 600,000 people who will take up a mortgage advance next year, and an even greater number who will do so in future years, that he wishes to abolish their right. If he does, I will gladly give way.

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby

We greatly enjoy the winding-up speeches of the right hon. Gentleman on a subject like this. [HON. MEMBERS : "Answer the question."]—I propose to answer the question. The right hon. Gentleman knows that I made it perfectly clear in my speech that I wished good luck to the owner-occupiers for all that they are getting by way of concessions. What I ask is : are the Government defending a situation in which the owner-occupier gets an indiscriminate and non-means-tested subsidy, but council tenants do not?

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

I can only take it from the last two sentences of the right hon. Gentleman's intervention that he thinks that we ought to means test owner-occupiers.

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

The right hon. Gentleman went on to argue that our proposals——

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby

Will the right hon. Gentleman answer my question? It is perfectly plain and direct.

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

I understood the right hon. Gentleman to say that he thought it was unfair, and did I not think it unfair, to means-test the private and public tenant and not to do something similar to the owner-occupier? [HON. MEMBERS : "No."] I am sorry that the right hon. Gentleman wants to invoke a means test for the owner-occupier.

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby

The Minister's right hon. Friend is, I hope, giving him the answer now. I hope that someone will give him an answer, because he is obviously incapable of finding one.

Photo of Mr Anthony Crosland Mr Anthony Crosland , Grimsby

Will the right hon. Gentleman answer this plain and simple question? If we are to continue—which I think is what all hon. Members want—this generally indiscriminate tax relief aid to the owner-occupier, does he think it right that the council tenant should receive aid only when it is means-tested?

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

The whole point of our means test is not to restrict but to increase help. It is intended to bring help, for the first time, to the tenants in private occupation and to enable us to give more generous help to those in public occupation. The right hon. Gentleman charged that our proposals would have a deleterious effect on public sector building. I find it difficult to follow the logic of his argument. Housing authorities will receive increased revenue as a result of the move to fair rents. What is more important are the new subsidies which we shall be giving to areas of stress. Under our proposals the clearing of slums and the rehousing of people are treated as separate operations, separately subsidised.

Let me say a few words on clearance. Under the present system, many authorities are inhibited from undertaking slum clearance as vigorously as they should since they cannot get a subsidy unless the land cleared is used at once for council housing. Under our proposals they will be able to use the land cleared for whatever development they think most advantageous socially—whether for parks or for shops and offices, or whatever it may be. They will still be able to collect the full subsidy and to build the new housing in whatever part of the town they want. This seems to me an important step towards urban renewal and improvement of the environment.

When it comes to rehousing, our proposals will increase substantially the financial help which the Government give to boroughs with severe housing problems but which they are now having to subsidise to a considerable extent from the general rate fund. The exact effect will vary from borough to borough, but where there is now a heavy burden on the rates these could be reduced by as much as 40 or 50 per cent. Take an area where there is stress, such as the London Borough of Camden. In 1970–71 it is estimated that its total subsidy entitlement was £1·7 million. In the first full year of the new system, it is calculated that it will retain £1·3 million of its existing subsidies and qualify for about £2·8 million of new subsidy. In total therefore it will have an increase of nearly 2½ times what it will have received last year. The Borough of Newham will get about £1 million more a year.

Photo of Mr Frank Allaun Mr Frank Allaun , Salford East

How will this save £200 million?

Photo of Mr Julian Amery Mr Julian Amery , Brighton, Pavilion

Neither my right hon. Friend the Secretary of State nor myself has presented these proposals as primarily an exercise in saving money. The housing subsidies will continue at about or perhaps above the present level for the rest of the decade. We shall be avoiding the enormous increase to about £550 million which the right hon. Gentleman dismissed as a mere shilling extra on the income tax which would otherwise have taken place.

We take pride in the reforms and proposals we put before the House, but we should like to give credit where credit is due. We recognise that the Labour Party has played a very big part in laying the foundations on which we are building—in the 1965 White Paper, in the development of the fair rents system, in the development of the rent officer system—and so we have naturally been intrigued to know what it would have done. My right hon. Friend the Secretary of State, when he laid his White Paper, put that question to the Opposition. He put it again today. We think that we have extracted some inclination towards historic costs in the public sector, but we are not sure. This is what my right hon. Friend tried to discover.

Last Tuesday, my right hon. Friend the Secretary of State asked the question three times. On the first occasion there was no reaction. He asked it again, and then I saw, to my astonishment, the hon. Member for Willesden, East lean across to the Leader of the Opposition and whisper something to him. I could not hear what it was, but I had the impression that he was saying, "Look out, Harold, Dimbleby is coming". On the third occasion that my right hon. Friend put the question, the Leader of the Opposition rose and gathered his skirts around him as if an assault were intended on his private virtue or as if my right hon. Friend were asking him how much he was paid for his memoirs, and hinted that there was some constitutional impropriety, that there had been some leakage.

I know very well that there are no leakages on the Civil Service side. The British Civil Service is a terminus and not a junction. Their confidences are kept as well as the confidences in the Smoking Room of this House. Nevertheless, it was reasonable to suppose that after all the statements which had been made by Lord Kennet, by the hon. Member for Willesden, East and by Lord Greenwood the Labour Party had arrived at some conclusions. They had plenty of opportunity to tell us about them today, if they have them, but the right hon. Gentleman the Leader of the Opposition said they had rejected such conclusions as were put to them. I am tempted to think that perhaps he was right, that perhaps he was telling us the truth, either that the Labour Party could not make up its mind, or it made up its mind and changed its mind when it got into Opposition. It would not have been the first time. It happened on industrial relations, on the Common Market, and now on housing. It would not be the first time, and it may be that where housing is concerned party unity comes before the national interest.

On 11th June of this year Mr. Des Wilson—no friend, in general, of this side of the House—wrote an article in the New Statesman and Nation under the title, "How Labour lost its grip", and I will quote the following passages : The verdict on Labour's performance must be harsh, all the more because of the impressive start which was made in 1964 to 1967. Labour showed itself to be woefully weak about shedding outdated doctrines and facing up to the realities of the modern housing problem. It never did really make up its mind about the sale of council houses. Most Labour leaders felt it to be a reasonable idea but were too afraid of the rank and file to say so, and ducked completely the problem of rents. It has to be said loud and clear about rents that some people have been over-fortunate for too long. There was no justice in a system where council tenants were subsidised and private tenants went without regardless of need. These are words of the New Statesman indeed, by a Labour sympathiser who had the courage to say—and I quote again— This was a real failure of statesmanship. Our proposals stand on their merits as a major contribution to British housing policy. They are also an integral part of the Government's wider campaign against poverty and squalor in all its forms—caused by lack of cash, and the squalor caused by deterioration of our environment.

We now come with proposals which, for many poor families living in privately rented homes, will for the first time give them help with their rents. This is a completely new departure, and it is essential if we are to deal with the problems of poverty. These proposals also play an important part in getting rid of housing squalor and give extra financial help for slum clearance and overcrowding. They will help London to be worthy of its position as one of the great capitals of the world, and will bring much-needed relief to other great conurbations.

Those who vote against this White Paper will be voting against people who are most in need and against those who are the poorest in the country.

Question put :

The House divided : Ayes 309, Noes 274.

Division No. 436.]AYES[9.59 p.m.
Adley, RobertEden, Sir JohnJopling, Michael
Alison, Michael (Barkston Ash)Edwards, Nicholas (Pembroke)Joseph, Rt. Hn. Sir Keith
Allason, James (Hemel Hempstead)Elliot, Capt. Walter (Carshalton)Kaberry, Sir Donald
Amery, Rt. Hn. JulianElliott, R. W. (N'c'tle-upon-Tyne, N.)Kellett-Bowman, Mrs. Elaine
Archer, Jeffrey (Louth)Emery, PeterKershaw, Anthony
Astor, JohnFarr, JohnKilfedder, James
Atkins, HumphreyFell, AnthonyKimball, Marcus
Awdry, DanielFenner, Mrs. PeggyKing, Evelyn (Dorset, S.)
Baker, Kenneth (St. Marylebone)Fidler, MichaelKing, Tom (Bridgwater)
Baker, W. H. K. (Banff)Fisher, Nigel (Surbiton)Kinsey, J. R.
Barber, Rt. Hn. AnthonyFletcher-Cooke, CharlesKitson, Timothy
Batsford, BrianFookes, Miss JanetKnox, David
Beamish, Col. Sir TuftonFortescue, TimLambton, Antony
Bennett, Sir Frederic (Torquay)Foster, Sir JohnLane, David
Bennett, Dr. Reginald (Gosport)Fowler, NormanLangford-Holt, Sir John
Benyon, W.Fox, MarcusLegge-Bourke, Sir Harry
Berry, Hn. AnthonyFraser, Rt. Hn. Hugh (St'fford & Stone)Le Marchant, Spencer
Biffen, JohnFry, PeterLewis, Kenneth (Rutland)
Biggs-Davison, JohnGalbraith, Hn. T. G.Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)
Blaker, PeterGardner, EdwardLloyd, Ian (P'tsm'th, Langstone)
Boardman, Tom (Leicetser, S. W.)Gilmour, Ian (Norfolk, C.)Longden, Gilbert
Body, RichardGilmour, Sir John (Fife, E.)Loveridge, John
Boscawen, RobertGlyn, Dr. AlanLuce, R. N.
Bossom, Sir CliveGodber, Rt. Hn. J. B.McAdden, Sir Stephen
Bowden, AndrewGoodhart, PhilipMacArthur, Ian
Boyd-Carpenter, Rt. Hn. JohnGoodhew, VictorMcCrindle, R. A.
Braine, BernardGorst, JohnMcLaren, Martin
Bray, RonaldGower, RaymondMaclean, Sir Fitzroy
Brewis, JohnGrant, Anthony (Harrow, C.)McMaster, Stanley
Brinton, Sir TattonGray, HamishMacmillan, Maurice (Farnham)
Brocklebank-Fowler, ChristopherGreen, AlanMcNair-Wilson, Michael
Brown, Sir Edward (Bath)Grieve, PercyMcNair-Wilson, Patrick (NewForest)
Bryan, PaulGriffiths, Eldon (Bury St. Edmunds)Maddan, Martin
Buchanan-Smith, Alrck (Angus, N & M)Grylls, MichaelMadel, David
Buck, AntonyGummer, SelwynMaginnis, John E.
Bullus, Sir EricGurden, HaroldMarples, Rt. Hn Ernest
Burden, F. A.Hall, Miss Joan (Keighley)Marten, Neil
Butler, Adam (Bosworth)Hall, John (Wycombe)Mather, Carol
Campbell, Rt. Hn. G.(Moray & Nairn)Hall-Davis, A. G. F.Maude, Angus
Carlisle, MarkHamilton, Michael (Salisbury)Maudling, Rt. Hn. Reginald
Carr, Rt. Hn. RobertHannam, John (Exeter)Mawby, Ray
Cary, Sir RobertHarrison, Brian (Maldon)Maxwell-Hyslop, R. J.
Channon, PaulHaselhurst, AlanMeyer, Sir Anthony
Chapman, SydneyHastings, StephenMills, Peter (Torrington)
Chataway, Rt. Hn. ChristopherHavers, MichaelMills, Stratton (Belfast, N.)
ChurchilI, W. S.Hawkins, PaulMiscampbell, Norman
Clark, William (Surrey, E.)Hay, JohnMitchell, Lt.-Col. C.( Aberdeenshire, W.)
Clarke, Kenneth (Rushcliffe)Hayhoe, BarneyMitchell, David (Basingstoke)
Clegg, WalterHeath, Rt. Hn. EdwardMoate, Roger
Cockeram, EricHeseltine, MichaelMolyneaux, James
Cooke, RobertHicks, RobertMoney, Ernle
Coombs, DerekHiggins, Terence L.Monks, Mrs. Connie
Cooper, A. E.Hiley, JosephMonro, Hector
Cordle, JohnHill, John E. B. (Norfolk, S.)Montgomery, Fergus
Corfield, Rt. Hn. FrederickHill, James (Southampton, Test)Morgan, Geraint (Denbigh)
Morgan-Giles, Rear-Adm.
Cormack, PatrickHolland, PhilipMorrison, Charles (Devizes)
Costain, A. P.Holt, Miss MaryMudd, David
Critchley, JulianHooson, EmlynMurton, Oscar
Crouch, DavidHordern, PeterNabarro, Sir Gerald
Crowder, F. P.Hornby, RichardNicholls, Sir Harmar
Curran, CharlesHornsby-Smith, Rt. Hn. Dame PatriciaNoble, Rt. Hn. Michael
Davies, Rt. Hn. John (Knutsford)Howell, David (Guildford)Normanton, Tom
d'Avigdor-Goldsmid, Sir HenryHowell, Ralph (Norfol[...], N.)Nott, John
d'Avigdor-Goldsmid. Maj.-Gen. JamesHunt, JohnOnslow, Cranley
Dean, PaulHutchison, Michael ClankOppenheim, Mrs. Sally
Deedos. Rt. Hn. W. F.Iremonger, T. L.Orr, Capt. L. P. S.
Digby, Simon WingfieldIrvine, Bryant Godman (Rye)Osborn, John
Dixon, PiersJames, DavidOwen, Idris (Stockport, N.)
Dodds-Parker, DouglasJenkin, Patrick (Woodford)Page, Graham (Crosby)
Douglas-Home, Rt. Hn. Sir AlecJennings, J. C. (Burton)Page, John (Harrow, W.)
Drayson, G. B.Jessel, TobyPeel, John
du Cann, Rt. Hn. EdwardJohnson Smith, G. (E. Grinstead)Percival, Ian
Dykes, HughJones, Arthur (Northants, S.)Peyton, Rt. Hn. John
Pike, Miss MervynShaw, Michael (Sc'b'gh & Whitby)Trafford, Dr. Anthony
Pink, R. BonnerShelton, William (Clapham)Trew, Peter
Pounder, RaftonSimeons, CharlesTugendhat, Christopher
Powell, Rt. Hn. J. EnochSinclair, Sir GeorgeTurton, Rt. Hn. Sir Robin
Price, David (Eastleigh)Skeet, T. H. H.van Straubenzee, W. R.
Prior, Rt. Hn. J. M. L.Smith, Dudley (W'wick & L'mington)Vaughan, Dr. Gerard
Proudfoot, WilfredSoref, HaroldVickers, Dame Joan
Pym, Rt. Hn. FrancisSpeed, KeithWaddington, David
Quennell, Miss J. M.Spence, JohnWalker, Rt. Hn. Peter (Worcester)
Raison, TimothySproat, lainWalker-Smith, Rt. Hn. Sir Derek
Redmond, RobertStainton, KeithWall, Patrick
Reed, Laurance (Bolton, E.)Stanbrook, IvorWalters, Dennis
Rees, Peter (Dover)Steel, DavidWard, Dame Irene
Rees-Davies, W. R.Stewart-Smith, D. G. (Belper)Warren, Kenneth
Renton, Rt. Hn. Sir DavidStodart, Anthony (Edinburgh, W.)Weatherill, Bernard
Rhys Williams, Sir BrandonStoddart-Scott, Col. Sir M.Wells, John (Maidstone)
Ridley, Hn. NicholasStokes, JohnWhite, Roger (Gravesend)
Ridsdale, JulianStuttaford, Dr. TomWhitelaw, Rt. Hn. William
Rippon, Rt. Hn. GeoffreySutcliffe, JohnWiggin, Jerry
Roberts, Michael (Cardiff, N.)Tapsell, PeterWilkinson, John
Roberts, Wyn (Conway)Taylor, Sir Charles (Eastbourne)Wolrige-Gordon, Patrick
Rodgers, Sir John (Sevenoaks)Taylor, Edward M.(G'gow, Cathcart)Wood, Rt. Hn. Richard
Rossi, Hugh (Hornsey)Taylor, Frank (Moss Side)Woodhouse, Hn. Christopher
Rost, PeterTaylor, Robert (Croydon, N. W.)Woodnutt, Mark
Royle, AnthonyTebbit, NormanWorsley, Marcus
Russell, Sir RonaldTemple, John M.Wylie, Rt. Hn. N. R.
St, John-Stevas, NormanThatcher, Rt. Hn. Mrs. MargaretYounger Hn. George
Sandys, Rt. Hn. D.Thomas, John stradling (Monmouth)
Scott, NicholasThompson, Sir Richard (Croydon, S.)TELLERS FOR THE AYES :
Scott-Hopkins, JamesThorpe, Rt. Hn. JeremyMr. Reginald Eyre and
Sharples, RichardTilney, JohnMr. Jasper More.
Abse, LeoDalyell, TarnGriffiths, Will (Exchange)
Albu, AustenDarling, Rt. Hn. GeorgeGunter, Rt. Hn. R. J.
Allaun, Frank (Salford, E.)Davidson, ArthurHamilton, James (Bothwell)
Allen, ScholefieldDavies, Denzil (Llanelly)Hamilton, William (Fife, W.)
Archer, Peter (Rowley Regls)Davies, G. Elfed (Rhondda, E.)Hamling, William
Armstrong, ErnestDavies, Ifor (Gower)Hannan, William (G'gow, Maryhill)
Ashley, JackDavies, S. O. (Merthyr Tydvil)Hardy, Peter
Ashton, JoeDavis, Clinton (Hackney, C.)Harrison, Walter (Wakefield)
Atkinson, NormanDavis, Terry (Bromsgrove)Hart, Rt. Hn. Judith
Bagier, Gordon A. T.Deakins, EricHattersley, Roy
Barnes, Michaelde Fneitas, Rt. Hn. Sir GeoffreyHealey, Rt. Hn. Denis
Barnett, Guy (Greenwich)Delargy, H. J.Heffer, Eric S.
Barnett, JoelDell, Rt. Hn. EdmundHilton, W. S.
Benn, Rt. Hn. Anthony WedgwoodDempsey, JamesHoram, John
Bennett, James (Glasgow, Bridgeton)Doig, PeterHoughton, Rt. Hn. Douglas
Bidwill, SydneyDormand, J. D.Howell, Denis (Small Heath)
Bishop, E. S.Douglas, Dick (Stirlingshire, E.)Huckfield, Leslie
Blenkinsop, ArthurDouglas-Mann, BruceHughes, Rt. Hn. Cledwyn (Anglesey)
Boardman, H. (Leigh)Driberg. TomHughes, Mark (Durham)
Booth, AlbertDuffy, A. E. P.Hughes, Robert (Aberdeen, N.)
Bottomley, Rt. Hn. ArthurDunn, James A.Hughes, Roy (Newport)
Boyden, James (Bishop Auckland)Dunnett, JackHunter, Adam
Bradley, TomEadie, AlexJanner, Greville
Broughton, Sir AlfredEdelman, MauriceJay, Rt. Hn. Douglas
Brown, Bob (N'c'tle-upon-Tyne, W.)Edwards, Robert (Bilston)Jeger, MTS. Lena (H'b'n&St. P'cras, S.)
Brown, Hugh D. (G'gow, Provan)Edwards, William (Merioneth)Jenkins, Hugh (Putney)
Brown, Ronald (Shoreditch & F'bury)Ellis, TomJenkins, Rt. Hn. Roy (Stechford)
Buchan, NormanEnglish, MichaelJohn, Brynmor
Buchanan, Richard (G'gow, Sp'bum)Evans, FredJohnson, Carol (Lewisham, S.)
Butler, Mrs. Joyce (Wood Green)Faulds, AndrewJohnson, James (K'ston-on-Hull, W.)
Callaghan, Rt. Hn. JamesFernyhough, Rt. Hn. E.Johnson, Walter (Derby, S.)
Campbell, I. (Dunbartonshire, W.)Fitch, Alan (Wigan)Jones, Barry (Flint, E.)
Cant, R. B.Fletcher, Ted (Darlington)Jones, Dan (Burnley)
Carmichael, NeilFoley, MauriceJones, Gwynoro (Carmarthen)
Carter, Ray (Birmingh'm, Northfield)Foot, MichaelJones, T. Alec (Rhondda, W.)
Carter-Jones, Lewis (Eccles)Ford, BenJudd, Frank
Castle, Rt. Hn. BarbaraForrester, JohnKaufman, Gerald
Clark, David (Colne Valley)Fraser, John (Norwood)Kelley, Richard
Cocks, Michael (Bristol, S.)Freeson, ReginaldKerr, Russell
Cohen, StanleyGa'pern, Sir MyerKinnock, Neil
Concannon, J. D.Garrett, W. E.Lambie, David
Conlan, BernardGilbert, Or, JohnLamond, James
Corbet, Mrs. FredaGinsburg, DavidLatham, Arthur
Cox, Thomas (Wandsworth, C.)Golding, JohnLawson, George
Crawshaw, RichardGordon Walker, Rt. Hn. P. C.Leadbitter, Ted
Cronin, JohnGourlay, HarryLee, Rt. Hn. Frederick
Crosland, Rt. Hn. AnthonyGrant, George (Morpeth)Leonard, Dick
Crossman, Rt. Hn. RichardGrant, John D. (Islington, E.)Lestor, Miss Joan
Cunningham, G. (Islington, S. W.)Griffiths, Eddie (Brightside)Lever, Rt. Hn. Harold
Lewis, Arthur (W. Ham, N.)Ogden, EricSmith, John (Lanarkshire, N.)
Lewis, Ron (Carlisle)O'Halloran, MichaelSpearing, Nigel
Lipton, MarcusO'Malley, BrianSpriggs, Leslie
Lomas, KennethOram, BertStallard, A. W.
Loughlin, CharlesOrme, StanleyStewart, Rt. Hn. Michael (Fulham)
Lyon, Alexander W. (York)Oswald, ThomasStoddart, David (Swindon)
Lyons, Edward (Bradford, E.)Owen, Dr. David (Plymouth, Sutton)Stonehouse, Rt. Hn. John
Mahon, Dr. J. DicksonPadley, WalterStrang, Gavin
McBride, NeilPaget, R. T.Strauss, Rt. Hn. G. R.
McCann, JohnPannell, Rt. Hn. CharlesSummerskill, Hn. Dr. Shirley
McCartney, HughParker, John (Dagenham)Taverne, Dick
McElhone, FrankParry, Robert (Liverpool, Exchange)Thomas, Rt. Hn. George (Cardiff, W.)
McGuire, MichaelPeart, Rt. Hn. FredThomas, Jeffrey (Abertillery)
Mackenzie, GregorPendry, TomThomson, Rt. Hn. G. (Dundee, E.)
Mackie, JohnPentland, NormanTinn, James
Mackintosh, John P.Perry, Ernest G.Tomney, Frank
Maclennan, RobertPrentice, Rt. Hn. Reg.Tomey, Tom
McMillan, Tom (Glasgow, C.)Prescott, JohnTuck, Raphael
McNamara, J. KevinPrice, J. T. (Westhoughton)Urwin, T. W.
Mahon, Simon (Bootle)Probert, ArthurVarley, Eric G.
Mallalieu, E. L. (Brigg)Rankin, JohnWainwright, Edwin
Mallalieu, J. P. W. (Huddersfield, E )Reed, D. (Sedgefield)Waiden, Brian (B'm'ham, All Saints)
Marks, KennethRees, Merlyn (Leeds, S.)Walker, Harold (Doncaster)
Marquand, DavidRhodes, GeoffreyWallace, George
Marsden, F.Richard, IvorWatkins, David
Marshall, Dr. EdmundRoberts, Albert (Normanton)Weitzman, David
Mason, Rt. Hn. RoyRoberts, Rt. Hn. Coronwy (Caernarvon)Wellbeloved, James
Mayhew, ChristopherRobertson, John (Paisley)Wells, William (Walsall, N.)
Meacher, MichaelRoderick, Caerwyn E.(Br'c'n&R'dnor)White, James (Glasgow, Pollok)
Mellish, Rt. Hn. RobertRodgers, William (Stockton-on-Tees)Whitehead, Phillip
Mendelson, JohnRoper, Johnwhitlock, William
Mikardo, lanRose, Paul B.Willey, Rt. Hn. Frederick
Millan, BruceRoss, Rt. Hn. William (Kilmarnock)Williams, Alan (Swansea, W.)
Miller, Dr. M. S.Sandclson, NevilleWilliams, Mrs. Shirley (Hitchin)
Milne, Edward (Blyth)Sheldon, Robert (Ashton-under-Lyne)Williams, W. T. (Warrington)
Mitchell, R. C. (S'hampton, Itchen)Shore, Rt. Hn. Peter (Stepney)Wilson, Alexander (Hamilton)
Molloy, WilliamShort, Rt. Hn. Edward (N'c'tle-u-Tyne)Wilson, Rt. Hn. Harold (Huyton)
Morgan, Elystan (Cardiganshire)Short, Mrs. Renée (W'hampton, N. E.)Wilson, William (Coventry, S.)
Morris, Alfred (Wythenshawe)Silkin, Rt. Hn. John (Deptford)Woof, Robert
Morris, Charles R. (Openshaw)Silkin, Hn. S. C. (Dulwich)
Morris, Rt, Hn. John (Aberavon)Sillars, JamesTELLERS FOR THE NOES :
Moyle, RolandSilverman, JuliusMr. Donald Coleman and
Mulley, Rt. Hn. FredsrickSkinner, DennisMr. Joseph Harper.
Murray, Ronald KingSmall, William

Resolved, That this House approves the White Paper "Fair Deal for Housing" (Command Paper No. 4728).