Housing

Part of Orders of the Day — Supply – in the House of Commons at 12:00 am on 21st June 1978.

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Photo of Mr Hugh Rossi Mr Hugh Rossi , Haringey Hornsey 12:00 am, 21st June 1978

I shall come to those points. I am conscious that the Minister wants a certain amount of time. But there is another problem with regard to the resident landlord. I understood the right hon. Gentleman to say that it is necessary to assist landlords in that situation to get back their property much more rapidly than they are able to under the law at present, when it is just and right that they should have it. Again, we concur.

There is also the lunatic situation today in which people leave their homes empty when they go abroad, or go to another part of the country, because they dare not let. Of course, an exception must be made to the provisions of the Rent Acts in order to cover that situation.

We are most conscious of the fact that, as the Green Paper says, there is a crude surplus of property over people requiring homes. We believe that that surplus exists mostly in properties which would otherwise be rented but are deliberately kept empty because it is felt that the Rent Acts are unfair. Therefore, we have brought forward the concept of short-holds and we shall legislate on this, so that, where a property is unlet when the legislation is introduced, if it is then let on a fixed-term tenancy it will not be subject to the security of the Rent Acts. In that way, we hope to tap this unused supply and bring supply and demand into balance.

As for rent regulation, of course it is necessary, particularly in areas of housing stress, to ensure that advantage is not taken of an unfair market situation. But there are anomalies. The rent officer and rent tribunal systems operate side by side, one applying fair rents and the other reasonable rents as a criterion. The Secretary of State did not mention that. Those two should be integrated, and a common criterion should be applied which gives a reasonable and fair return to the owner of the property to ensure that he is encouraged to let rather than discouraged from letting, the property, while ensuring at the same time that rogues cannot exploit a difficult situation.

A residential landlord who has let part of his premises is today subject to capital gains tax on that part of the property which has been let. Our evidence shows that, particularly in the university cities, that is a disincentive to letting to students. We would remove it. My hon. Friends are seeking to press an amendment to the present Finance Bill in Committee to achieve just that. It will be interesting to see to what extent the Government believe in helping the residential landlord by the attitude which they take to that amendment.

I also welcome what the Secretary of State said about improvement grants. However, we must first make sure that the conditions attached to the grants are relaxed. Far too high a standard is required by local authorities as to other works which have to be done in addition to that for which the grant is sought. When people face that additional expenditure, they do not take up the grant. Often, by any objective judgment, those extra works are not really necessary, but the local authority is compelled to require them by the form of the legislation.

There is also the question of rateable value limits, which should be relaxed. However, the Secretary of State's statement rings a little hollow when we consider that only 48 per cent. of the proposed expenditure in Block II for improvement grants in the private sector has been approved by his Department for this year. That does not seem to add up to the statement that he has made about his policy.

So far, sweetness and light, but I do not find the rest of the right hon. Gentleman's speech so attractive. Of course he has to rally the troops and raise their morale, since he is about to lead them into battle. But, as my hon. Friend the Member for Henley (Mr. Heseltine) said, the Government's housing programme has been a disaster, despite the brave face that the right hon. Gentleman placed upon it.

My hon. Friend spelled out the figures. Quite uncharacteristically, we had from the right hon. Gentleman a virulent outburst against the AMA because the Association had dared issue a Press statement to the effect that the Government were allowing it only 69 per cent. of local authority bids for capital expenditure for housing.

Of course, that kind of statement is very inconvenient when the Secretary of State is trying to persuade the House that the alibi for the disastrous programme is that the wicked Tory councils have not done their work. When someone produces figures to show that they have not been given the money to do that work, it becomes rather inconvenient. The Secretary of State then attacks the AMA and says that the secretary did not have the authority of his chairman to make that statement. I do not know how long that chairman will remain chairman. I understood that he was on his way out, and that his views did not represent those of the AMA at present.

If the Secretary of State does not like the AMA figures, perhaps I could refer him to the figures produced by the National Federation of Building Trades Employers. In its report and comment on the housing investment programme, it summarises its conclusions: Local authorities in England wanted to invest £3,521 million in housing in 1978–79—an increase of 52 per cent. in real terms over what they were allowed to spend in 1977–78. Central government have approved only 69 per cent. on average of the local authorities' housing investment plans for that year. It may well be that the Secretary of State will say that a 52 per cent. increase is far too large, and therefore he must cut back. That is all very well, but he cannot say at the same time that local authorities do not want to spend that money. He cannot have it both ways.

The report continues: For the year 1978–79 the level of local authority housing investment approved by the Government is only 4 per cent. higher on average than the level of the previous year (which had been the lowest for many years). If one looks at the Government's White Paper on public expenditure, Command 7049, one sees that the total authority investment capital expenditure in 1977–78 was the lowest for many years. One also finds that for 1977–78 it was lower than for 1976–77, which in turn was lower than for 1975–76, which was lower than for 1974–75. It is still lower than for 1973–74 and for 1972–73. There we have the figures from this independent source which show that the Government capital investment programme is not what the Secretary of State would have us believe it is.

The Secretary of State decried our suggestion that we wished to sell council houses, or give council tenants the right to buy their own houses. That theme was echoed by some of his hon. Friends. He said this was because the Tories are against local authority housing. That is not the case. We wish to give people what they want. We believe that that is our duty. We want to help people to fulfil their aspirations. The fact is that 49 per cent. of the sample of young married couples who said they wanted to own their own homes said they could not ever see that eventuating out of their own resources.

The comment was made that this was a bad deal and that sales of council houses were not terribly successful, because the take-up was not good. On Friday I was in Nottingham and it was my pleasure to hand over the keys to the tenant of the 3,000th house sold in the past 18 months by the incoming Conservative council. That means that there are 3,000 happy council tenants who now own their homes.

The financial consequences for the local authority were very good. Capital sales total £23 million, showing a profit of almost £8 million on the original provision of those houses. That means £8 million additional worth of capital in the coffers of that local authority. The consequence on the housing revenue account is that a former deficit on the non-mandatory rate fund contribution of £1·2 million was reduced to nil in the next year. That is the consequence for the ratepayers of Nottingham. This success story could be repeated throughout the country and could transform the economy of local authorities.

One local authority told me that its housing stock was valued at £60 million. If the entire stock were sold, not only would it not be necessary to demand any subsidies at all from the Exchequer; the authority would not have to charge the ratepayers a penny rate. Indeed, it could give the ratepayers a dividend. The release of capital moneys in that way could mean the elimination of interest charges having to be paid by the local authority, the elimination of the responsibility for repairs, and the elimination of the need for maintenance and management. This could transform the economy of the local authorities and the nation dramatically. This is what the people want.

I am not saying that we do not see any role for local authorities in housing. Of course that is not the case. As my hon. Friend the Member for Hove (Mr. Sainsbury) said, there will always be those who do not want to become home owners, and provision must be made for them. There will be those who, because of their financial circumstances, cannot become home owners. The elderly will always need to be provided for, as will the disabled and the single who do not qualify under most points schemes.

This must be the function of our society—a compassionate society—to help those who cannot help themselves. But in respect of those who can help themselves, there is no need for them to remain a burden on themselves, through their rates and taxes, and on the remainder of the community.

I could go on to outline a number of features of my party's housing programme, which I feel is the best programme this country has seen in housing for at least four decades but my agreed time is up. I shall be proud to see it presented by my right hon. and hon. Friends at the coming election.

The Minister has already said that he does not want to enter into a Dutch auction on our proposals. Of course he does not want to do so. He cannot begin to compete with our proposals. I am sure that the people of this country will well realise this, and give their decision convincingly in the not too distant future.