Orders of the Day — Housing (England and Wales)

Part of the debate – in the House of Commons at 12:00 am on 20th June 1977.

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Photo of Mr Michael Heseltine Mr Michael Heseltine Shadow Secretary of State, Shadow Secretary of State for Environment 12:00 am, 20th June 1977

The figures put out by Mr. Kilroy do not accord with the figures put out by Mr. Peter Sparling, Chairman of the Leeds City Council Housing Committee. This is not a subject for discussion across the Floor of the House. The fact is that for there to be a profit on a council house letting—which cannot take place in the first year because we understand that the subsidies are over £1,000—there has to be a relative change in the balance between rents and repairs. Rents must rise faster than repairs. As the repair bills have been rising at a rate of 15 per cent to 20 per cent. in the current year, rents will have to increase in order to improve the position of the State investment. It is an unlikely situation to put by way of hypothesis.

The next area which the Secretary of State should take as a target relates to the sale of new town assets. In case the Labour Party says that it is not prepared to consider a half-way house, I wish to say how pleased I was to see the Housing Corporation Press Release of 15th June because it showed that the City of London raised £35 million to make good the cuts in public expenditure imposed by this Government on housing associations.

I was delighted to hear that news. I have always believed that the savings of the British people, managed by the City of London, should be made available for housing. That is precisely what has happened. I remember in the last housing debate asking the Secretary of State for the Environment to encourage these moves, and I believe that the right hon. Gentleman has committed himself in principle. I hope that we shall hear no more from Labour Members against the concept of encouraging private sector investment in this way.

Why not go further, and encourage as many of the new towns as wish to do so to sell their freehold assets and thus raise substantial sums of money for a variety of purposes that it would be profitable to discuss? An obvious but important point contained in the Housing Corporation Press release is that it says that devices can be reached whereby a flow of private funds to the development and housing funds can be produced. I hope that the Secretary of State will deal with that in his housing review. The right hon. Gentleman should bring a more dynamic approach to the planning procedures which, in terms of time taken, are making substantial contributions to the cost of new housing.

I should like the Secretary of State also to consider the statistics in the Housing and Construction Statistics, volume 20, for the fourth quarter of 1976. These show that it now takes between 19 and 26 months to complete a new house or flat in this country. That seems to be an inordinate period of time, and the Secretary of State should look into the matter. It means that resources are being committed over a long time and, because of the time taken, the cost of building new homes is rising dramatically.

I now wish to turn to the renting side of the problem. There are some 5 million tenants in local authority housing and that means that there must be a great deal of political concern. As has been established in earlier interventions, the Government are committed to increasing the proportion of rent to 50 per cent. of the housing cost by the end of the decade. We all want to know the Government's latest view on the matter. I believe that the Government will want to await publication of the housing review which is due next Tuesday. In these circumstances we shall look carefully to see whether the Government have, for electoral reasons, abandoned the pledge spelled out in Command Paper 6393. Certainly this or any Government will be forced by the circumstances of financial restraint to move in that direction and it would be intolerable to do that unless there were a number of other incentives surrounding that movement. There would have to be a determined attempt to sell—and I mean really sell—council houses to council tenants.

We should also expect to see increased publicity for rent rebate schemes that were introduced under the last Tory Administration, because it is a sadness to many hon. Members to find while doing their constituency casework that many people do not know their entitlements in this matter.

There would also have to be a move forward with the concept of a tenants' charter. There are a whole range of areas in which bureaucracy denies to tenants a proper rôle in the management of their estates. The management side of the tenants' charter is probably the most important, because it should be possible to devolve a degree of responsibility and thus eliminate a certain amount of bureaucratic influence if tenants played a greater rôle. The Secretary of State should also encourage the experiments that are now being conducted by the GLC, where "homesteading" is becoming a new word in the domestic housing vocabulary. It is an admirable concept of self-help that should certainly be encouraged across the country.

I now wish to talk about private rented accommodation in which 2 million or 3 million people—often of the lowest income groups in society—find their homes. Everybody understands that this is the area in which the most acute problems are to be found. We have a number of suggestions that could be of help.

Whether one likes it or not, there are many empty properties, and while the present paraphernalia of the law remains as it is those houses will remain empty. The objective of those politicians who have a detached view of the matter must be to find solutions to the grave problems that must be overcome and to help that large number of people who do not live in the sort of housing for which we all wish. [Interruption.] The problem of the hon. Member for Salford, East is that he has a parrot cry for every sensible debate on any subject. One has only to mention a major national crisis affecting the lower end of the housing market and the hon. Member for Salford, East produces his parrot cry. We do not advocate conditions that would permit such a fringe of abuse as causes concern and does harm to an otherwise perfectly reasonable industry. We should not tolerate the reintroduction of the techniques that allowed such people as Rachman to earn such discredit.

This is a problem that concerns people on both sides and I should like to look now at what we can do to deal with it. The concept of a shorthold should be tried. We shall try it when we are in Government and I hope that the party opposite will not immediately indulge in yah-boo techniques of party politics to try to discredit the scheme before it has had a chance to work. We shall certainly introduce it, because it would be better for people to be allowed to enter into fixed period leases on the clear understanding that at the end of the time fixed there would be no further commitment to letting. It would be a clear understanding between landlord and tenant. We should want to see duties imposed as much upon on the landlord as on the tenant but it should be a contract freely entered into by both sides. It should be given a chance to work.

The Secretary of State should also consider an extension of the Bromley scheme, whereby private institutions could be encouraged to build, for example, on local authority land—where the local authority produced the land—for open market rent. There should be a contract that all parties concerned should accept. It would not prejudice the political freedom of local authorities. The private provider of capital would, in fact, be using the savings of the life insurance companies and pension funds and should be allowed to charge an open market rent for the properties. If local or national Government intervened to prevent that open market rent there should be a right of compensation for those people who had invested. Nothing could be fairer than that. It means that there would be an opportunity to encourage home building together with an assurance that if the experiment did not work those savings that had been invested would not be put at risk.

The concept of the North Wiltshire scheme offers a real opportunity of partnership between the public and private sector and the Secretary of State should encourage it.

I also wish to put a personal point of view. We all understand that there is a real difficulty with private rented accommodation. There are good and bad landlords and good and bad tenants. With 2 million people involved there will always be that mixture of human beings. The question is how we shall deal with the situation. We should move to the sort of experiments that I have put forward and to which my party has been committed for some time. Other similar experiments have been put forward. I believe that we should set up a Select Committee of the House to monitor what is happening on the ground, to judge the facts and to help up to make future judgments. We cannot lightly allow 2 million to 3 million houses to continue declining as they are now doing because we cannot solve the differences between two political parties in trying to judge the issue.

The severity of the national economic crisis that now besets the country has been gravely worsened by the Government, and not only in national economic terms, because the Government have introduced specific measures that have harmed the house building and home owning industries. The Government's total reliance on the public sector has proved to be illusory, and they are doctrinally unsuited to changing direction and to putting their faith in the direction that we advocate—that is, home ownership and encouragement of the private market. That is the only option left and the sooner that we move in that direction the better.