They were not record years for house building in the private sector. They may have been record years for house building in the public sector, but that record did nothing to reduce council house waiting lists.
I remember the introduction of the Development Land Tax Act 1976 by the Government of which the hon. Member for Hodge Hill was a member. They introduced it because the Community Land Act 1975 was seen patently not to work, to do the reverse of what it was designed to do, and to freeze the supply of land. What happened? The supply of land dried up completely. When bank finance became more readily available, the money fell into the hands of secondary and tertiary banks and property speculators who made profits hand over fist and contract against contract. No foundations were dug. No brick was laid. No house was built, and the level of homelessness increased.
The supply of land will increase only through the operation of market forces—supply and demand working in partnership—and if this punitive tax, which last year was 8 per cent. higher than corporation tax and which is now well above the level of that tax, is abolished. Land prices will stabilise and the construction industry will feel that it can buy land at realistic prices and offer properties built on that land at prices that people can afford.
Opposition Members fail to accept that an impost of 60 per cent. has the effect of increasing the cost of land by 60 per cent. It discourages the land owner from bringing that land forward for development. The hon. Member for Hodge Hill said that he looked for a replacement tax to contribute towards infrastructure costs. That tax exists. Capital gains tax will continue to be paid by the private landowner and corporation tax will be paid by the company that sells land. How can he say that a reduction in taxation which will guarantee to increase the supply of land and stimulate the construction industry, and the jobs created thereby, is not a good measure? How can he say that with a corporation tax rate of 35 per cent. there is no replacement taxation? How can he say that a form of taxation whereby development gains cannot be offset against development losses is a good form of taxation? How can he say that a form of taxation that costs the development land tax office in Middlesbrough more to collect than the Exchequer receives is a good form of taxation? It is nonsense.
I look to the construction industry to respond now to my right hon. Friend's welcome announcement in the Budget speech and to buy land, and for landowners to make land available at realistic prices so that builders can employ the skilled labour that a boost to home ownership will require which is waiting for the jobs. That will benefit young married couples on council waiting lists in my constituency and that of the hon. Member for Hodge Hill who want to get on to the ladder of home ownership. A reduction in the 60 per cent. punitive rate of taxation will release more land at realistic prices.