The Bill gives us an admirable but rare opportunity for which we are grateful to discuss the development of the new towns.
The increase in the expenditure limits is £250 million, which I think the Minister said would be consumed during this year. Perhaps he will tell us whether the further increase of £500 million which is allowed for by order is included within the total borrowing requirement of the Government. I do not think it is, but perhaps the Minister will let me know, as during the last week there has been an increase in the borrowing powers of the British Steel Corporation of £750 million and of £50 million for the National Bus Corporation. Will the Minister tell us how long, with the present rate of inflation, it will take us to get through these extra borrowing powers?
I agree with the consultative document that it is right to take a fresh look at the principles upon which new towns were based. In my constituency, Crawley was originally designed to take a population of 50,000 people. It now has a population of 72,000, and this population is growing rapidly from natural growth. Despite a substantial housing programme, there is still a long waiting list and a shortage of labour in industry in Crawley. I was surprised when the right hon. Gentleman said that the waiting lists for new towns were shortening. That is not my experience. I should like to check the figures later.
One considerable difficulty which was not originally foreseen because of the rapid growth of some of the new towns has been the slow growth in the resources which are required to service those new towns. I refer in particular to Crawley Hospital, although I shall not speak on it at length because I have done so already in the House. The capacity of the hospital in Crawley is clearly insufficient for the existing population in Crawley, let along the other population which the hospital is designed to serve in Horsham and the Horsham rural area. This does not take into account any growth in the next few years. It is particularly disappointing, therefore, that the Secretary of State for Social Services thought it right to defer the extension to Horsham Hospital. It is very important that, with the growth of housing, the growth of proper facilities and infrastructure should go alongside, and that does not appear to be happening at the moment.
I turn to the question of housing and the proposal to transfer the Commission's housing assets to the local council. I accept that new towns start at a disadvantage compared with old towns because they have only a small stock of old housing and no cheap housing debt to go with it. However, the Government's proposal to hand over the Commission's housing assets effectively means handing over national community assets to local communities. It would be unthinkable to sell off commercial national assets belonging to the Government—for nationalised industries, for example—at less than the market price to private business interests. This is the first time that assets which have been created by the nation have been handed over to particular local sections of the community at historic cost. That is what the proposals in the Stevenage document mean, when it is suggested that the existing debt structure should be passed on. I do not know whether this has yet got past the Treasury, but it will surprise me if it gets through altogether unscathed. We shall see in due course.
However, that is not the point which concerns me in particular. What we need to be satisfied about is that the transfer of housing assets and of responsibility to the local housing authority will get more houses built. I wish to pay my tribute to the work of the Commission in Crawley for its excellent record in house building and management. Indeed, so good has been its record that I should have thought that the Government, with their declared interest in participation, would have taken the opportunity to ask the tenants of Commission houses whether they want to be taken over by the local authority or not. I am confident that they would prefer to stay with the Commission for the New Towns.
I am sorry that the Crawley council's housing record has not been particularly good in recent years. Indeed, it has proceeded with such speed and efficiency as to make a tortoise look like a hare. It is falling far behind its original programme of 500 houses a year. The question is whether it is able to carry out a programme of rapid expansion. I thought that it was sensible to use all existing resources to carry through a large housing programme, and that is why I regret that housing will not remain one of the Commission's responsibilities. It seems to me that the greater the impetus we can get behind the housing drive, the better. That is why some time ago I approached the Crawley industrial group and the Guiness Trust and invited them to form a housing association. That is now a success, I am glad to say, and houses will shortly be appearing.
However, it is not enough to release land or to encourage more voluntary associations to build. I am very sorry that the Community Land Bill will dry up the supply of land coming on to the market. What is becoming increasingly clear is the need to review the whole question of housing finance. The article by Christopher Booker and Bennie Gray in yesterday's Observer shows what an impossible position housing finance has got into. It costs at least £15,000 now to build a house in Crawley for which the average rent is £4·50 a week. The subsidy to tenants is very large, although nothing like as large as in London where, according to Booker and Gray, it amounts to £60 a week.
The total council housing deficit paid for out of rates and taxes will amount to £1,450 million this year. This is more than twice what it was two years ago. Capital spending on council house building will be more than £2,000 million this year, which compares with £720 million in 1972–73. These figures are alarming. Clearly we cannot go on like this. Either the council house building programme will have to be cut sharply or rents will have to go up, unless the Government change their policy. The Government are responsible for inflation and that is what has created the crisis in housing finance.
There is one step by which the Government could ease the position, and that is to sell council houses to existing tenants. There is no question about the popularity of this step. Of nearly 9,000 houses owned by the commission in Crawley in March 1974, there were applications to buy from 4,192 tenants. Funds would be released for building far more council houses than can now be provided at the present level of rents.