Orders of the Day — Housing

Part of the debate – in the House of Commons at 8:38 pm on 25th November 1980.

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Photo of Jack Straw Jack Straw Shadow Spokesperson (Treasury) 8:38 pm, 25th November 1980

The debate has been illuminating in two respects. First, the majority of Conservative Members are voting with their feet. Despite the activities of Government Whips, few Conservatives have taken part in the debate. Secondly, the debate is interesting in terms of what Conservatives have let out of the bag. The hon. Member for Lichfield and Tamworth (Mr. Heddle) spoke seriously about the abolition of waiting lists. The hon. Member for Folkestone and Hythe (Sir A. Costain) let the cat out of the bag by admitting that shorthold tenure exists to get round security of tenure for private tenants. The hon. Member for Hornchurch (Mr. Squire) admitted that the country faces years of national misery.

Part of that national misery is being secured by the Secretary of State for the Environment, because he is presiding over what will become the worst housing crisis that many of us will have seen in our lifetime. When the Secretary of State is challenged on that, instead of accepting blame for the crisis he suggests that his policies are a continuation of policies that were followed over five years by the previous Labour Government. In seeking to justify his record, he utters three sets of falsehoods about Labour's programme: about the level of Labour's construction programme—the level of cash put into the housing programme over those five years—about our record on projections and starts, and about our record on projections of future demand. I shall deal with those three points in turn.

First, with regard to the level of the Labour Government's house building programme between 1974 and 1979, the Secretary of State has said time and time again that the programme that he is following is merely a continuation of the trend set under the Labour Government. He said again today that Labour's programme was in rapid decline and that all that he has done is to follow that through. I know that the encounters of the Secretary of State with truth are always brief and accidental, but even he should address himself to the facts before uttering such falsehoods. The truth is that during the five years of the Labour Government from 1974 to 1979, an average of 135,000 dwellings were built each year—11,000 more than were built in each of the years of the previous Conservative Government from 1970 to 1974. Even in 1978—the last complete year of the previous Labour Government—we achieved 107,000 starts, which compares very well with the 55,000 starts that are likely to be achieved this year and the probable 40,000 or next year.

If the Secretary of State believes that all that he is doing is following a trend, he should see what is happening locally. The worst year for my constituency of Blackburn under the previous Labour Government was that of 1978–79, when there were 129 starts. As I said earlier, this year there have been only four starts, and it is not likely that there will be any more. I do not believe that that is a continuation of a trend.

What is true in terms of starts is also true in terms of expenditure. Between 1974 and 1979, Labour's housing expenditure averaged more than £6 billion—£2 billion, or 50 per cent., more than the average between 1970 and 1974. Labour's worst year between 1974 and 1979 was better than the Conservative's best year between 1970 and 1974.

The Secretary of State said that the amount of expenditure fell consistently between 1975 and 1979. That is true, but what he always fails to point out is that it fell because it reached an all-time post-war peak in 1974–75—an increase in that year alone of £2 billion, as a result of the Labour Government's counter-inflation policies of freezing rents and pumping more subsidies, rightly, into the coffers of the councils and their housing revenue accounts.

The second falsehood that the Secretary of State utters is on the extent to which Labour's projections on the starts have matched the outturn. Only two weeks ago, the Secretary of State said: the Labour Party's performance never met—or did not usually do so—the figures that it put forward. I have never expected the Labour Party's performance to live up to its promises."—[Official Report, 12 November 1980; Vol 991, c.465.] The truth is that in three of the five years of the Labour Government we exceeded our promises in terms of starts. The Secretary of State should remember that. Only in two years did we produce an outturn less than the total starts.

I should like to give the Secretary of State the figures. In 1974 we were 21,000 starts ahead of the forecast, in 1975 we were 14,000 starts ahead of the forecast and in 1976 we were 5,000 starts ahead of the forecast. In 1977 we were 13,000 below it. In 1978, the last complete year, we were 18,000 below it. A total of 720,000 dwellings was forecast for the five complete calendar years, and we built 730,000. If we include 1979, when the Secretary of State was responsible for most of the year and the construction industry faced its worst winter for 30 years, we had 830,000 starts and the outturn was 810,000.

Let us have no more falsehoods from the Secretary of State that suggest that he cannot bring forward projections of the level of starts because Labour's record was so bad. The Labour Government's record was excellent, as was the record of his predecessors between 1970 and 1974. The cumulative error was no more than 2·5 per cent. The standard that statisticians use, the absolute mean error, resulted in no more than a 10 per cent. error. If the right hon. Gentleman consults his statisticians, they will confirm what I have said.

The third falsehood that the right hon. Gentleman utters concerns forecasts of housing demand. Whenever we have asked him to declare what his forecasts for housing demand will be in the next five years, he has replied "We cannot do that because the Labour Government considered that and in their Green Paper it was stated that those forecasts of demand were highly speculative." I invite the right hon. Gentleman to address himself to the contents of the Green Paper. Nowhere in the Green Paper are the words "highly speculative" used about projections of demand. Those words are used in page 135 in terms of whether the public sector would meet the demand and whether the supply of dwellings between 1980–85 would be sufficient to meet the demand that was then clear. It was reasonable of the writers of that document to state that the figures were highly speculative. They had to look into the crystal ball and predict what a Conservative Government or a change of Government would mean for the council house building sector.

The figures for the level of housing demand are based on demographic information. That is available within the right hon. Gentleman's Department. It concerns the level of household formation over the next five years. The right hon. Gentleman knows that on the best figures available we shall be 500,000 houses short.

We have long believed that the right hon. Gentleman had the information in his Department. I genuinely commend him for his managerial efforts to improve Ministers' information systems and his publication of those systems. This is an important development in the control of Ministers over their civil servants and the control of the House over Ministers. I unreservedly congratulate the right hon. Gentleman on that development.

However, if we consider one of the 17 documents that the right hon. Gentleman placed in the library, we see that housing directorate A is running an assessment of past and current trends and future prospects for housing. Assessments of global trends in housing have already been carried out. Therefore, the right hon. Gentleman can no longer hide behind suggestions that the information is not available or that his Department is not preparing it. It is on record that information is available in his Department about the level of demand. We want to see that information published. Failure to publish it will merely confirm our worst suspicions—namely, that the right hon. Gentleman is suppressing information about Britain's mounting housing crisis.

It was announced this afternoon that more than 2,100,000 are unemployed. That is the highest total since the war. It is the highest total since February 1933, when 2,411,358 were unemployed. The fact that the Government have increased unemployment to levels never seen since the late 1930s or before the early 1930s is significant. Ministers have only 200,000 to go before they exceed the highest total throughout the 1930's. There will be only two months more of unemployment before the levels under this Government are the highest ever recorded this century.

The fact that we are plumbing the depths of unemployment that were reached in the 1930s has led to suggestions that the Government are following the economic policies of the 1930s. I wholly reject that. They are not. They are following the policies of the 1870s, when we were plunged into the greatest depression that the country has seen since industrialisation. Even the National Government in the 1930s realised that housing construction could be an engine of economic recovery. Alan Taylor, in "English History 1914–1945", records that the building boom was the outstanding cause for the recovery of the thirties when the recovery came the building boom accounted for 30% of the increase in employment between 1932 and 1935. That is why unemployment started to go down after 1934. The reason why it is starting to go up and will far exceed the levels of the 1930s is, above all, that the Government have flown in the face not only of the Keynesian post-war experience but of the experience of the 1930s. They have failed to understand that massive cuts in public spending hit not only the public sector but the private construction industry and that that leads to a massive increase in unemployment.

The Government's policies are those of the blind Victorians, who believed that the market should be allowed to operate without intervention. The Prime Minister clearly does not understand. But unless there is a significant change in policy and the Government start to put money into housing instead of taking it out the national misery of which the hon. Member for Hornchurch spoke will last not for only two or three years but for the 28 years of the depression that started in 1870.