That is absolutely right and I am extremely grateful to my hon. Friend for underlining that point.
My hon. Friend will be aware that there are very few hotels in the east end of London. Therefore, only about 50 of the 300 households needing such accommodation can be placed in Newham; the other 250 have to be placed further afield, as far away as Paddington, Bayswater, Hounslow and Southend.
These constituents are, by definition, in "priority need". They are people who already have more than their fair share of problems. To be physically removed from friends and their communities together with the long journeys that that involves exacerbates their problems. Many of Newham's homeless have children, and 22 per cent. of the women are pregnant. Others are vulnerable because of old age, mental or physical disability. The conditions in bed and breakfast accommodation can have serious detrimental effects on their health and well being.
The dislocation involved makes the maintenance of contact with social workers, health visitors and doctors difficult. It is estimated that Newham will be forced to put over 1,200 children into bed and breakfast accommodation this year. Inevitably, their education will be disrupted and many will be kept away from school.
Ethnic minority households have particular problems as cultural and religious dietary needs are not catered for by these hotels. The lack of cooking facilities also causes difficulty. Often these damp, overcrowded conditions, diets of cold food and take-away meals cause stress and illness. Because of the acute shortage of suitable hotels, Newham has been forced to use sub-standard accommodation. That is not only a disgrace but a danger to the health and safety of the occupants.
I am not being an alarmist, and I am choosing my words carefully, but unless extra resources are forthcoming and Government restrictions relaxed, it is only a matter of time before the next major fire, or other disaster, causes the death or injury of families.
This recourse to bed and breakfast accommodation is a monstrosity which must be ended. Before 1979, it was virtually unheard of. Now it has become the badge, and main result, of Conservative housing policy. It is not only inhuman but, as my hon. Friend the Member for Newham, North-West (Mr. Banks) has just pointed out, it is an insane waste of money. It is extremely expensive and costs more than building new homes, or housing the homeless in almost any other way.
When answering a parliamentary question on 20 December 1985 the Minister for Social Security said that the cost of accommodating a family with two children in board and lodging in London would be £13,150 per annum but that the cost of providing them with proper council housing would be just £5,060—just half the cost of keeping people in the misery and squalor of bed and breakfast accommodation. Where is the sense, where is the financial prudence in that? It is economic and social lunacy.
Bed and breakfast is the most expensive and least desirable of solutions. When I appeal to the Government for more resources for housing in Newham, I am advocating not the waste of money but its more sensible use. Money spent on board and lodging for the homeless is money down the drain. Money spent on new houses and repairing old houses is good housekeeping.
There are clear, long term financial benefits in providing more council homes. The growth of DHSS board and lodging expenditure is to a large extent the consequence of cuts in the Department of the Environment's capital investment in housing. It is absurd to pay huge sums to offer minimum relief to the victims of homelessness, instead of investing in the solution to their real problem.
The Government could make other very real savings from expenditure on new building, for unemployed construction workers would then be taken off the dole and additional tax income would be paid to the Exchequer. We need urgently additional capital allocations. The Government's restrictions need to be relaxed. The Treasury's arguments against this do not stand up against the size of the potential savings.
I hope that the Minister's reply will be constructive and that he will offer hope to the people of Newham. I hope that he will not seek to pass the buck to the council, or seek to blame it. He cannot accuse it of being profligate. For example, management costs per dwelling in Newham in 1985–86 were £183. In Wandsworth they were more—£189. Maintenance costs per dwelling in neighbouring Redbridge for 1985–86 were £767, whereas in Newham they were less than half that—£292.
Nor does Newham have a large number of empty council dwellings, or voids. If empty tower block flats are discounted, Newham's void rate is 4·5 per cent.—less, for example, than in Wandsworth where it is 4·6 per cent. Most of these voids are being repaired and improved and will be available for letting, but the scale of this programme is dependent on finance, particularly next year's capital allocations.
What will Newham's housing investment programme be next year? It will be announced very shortly. The new proposals of 3 December show that while Barnet, Bromley, Hillingdon, Merton and Richmond upon Thames—all Conservative councils in wealthier parts of London—have had their allocations increased under these proposals, that for Newham is to be cut by £6 million. That is absolutely monstrous. It is the opposite of what common sense and humanity require. The Department's proposals will be disastrous.
I hope that this afternoon the Minister will take that point on board. Regrettably, Newham, like other boroughs, has rent arrears, but it would be absurd to attempt to blame the housing crisis on that fact. These arrears have partly been caused by staff shortages, by the change to decentralisation and by staff concentrating on the turn round of voids and on getting the repairs service working efficiently. The annual cost to the borough of arrears is £681,000, and energetic attempts are being made to tackle it.
A major cause of rent arrears is financial hardship. Newham is an area of great poverty. While the number on the poverty line nationally has doubled since 1979, in Newham it has increased by 150 per cent. It is not only that some rents have not been paid; mortgages also have not been paid. No one would say that people do not want to pay their mortgages. However, growing poverty is stopping them.
Figures given by the Minister's Department last week show that the number of people whose homes have been repossessed or who are more than six months in mortgage arrears had reached an all-time high. Nationally, they show that in June 1986, 20,020 families, and single people had their homes repossessed compared to 2,530 in December, 1979. The number of people six months or more in arrears with their mortgage reached 66,930 in June compared to 8,420 in December, 1979. The Minister may mention the £15 million that the Government are giving to the Housing Corporation. This is an interesting idea, but even with the private money this would attract, the extra homes built would still be fewer than the increase in homelessness that is envisaged, so that will not provide a solution to this cruel problem.
What does Newham need? It needs immediate emergency aid this winter to defray the £1·75 million burden that the mushrooming of bed and breakfast is costing. We need a concerted attack on the main problem. This means, first, the restoration of the cuts and a substantial increase in housing capital allocation—at least to meet the council's bid for £67 million for 1987–8 to allow additional new building. Secondly, we need an increase in revenue support through reinstatement of rate support grant and an end to selective rate limitation. Thirdly, the Government should immediately lift the restrictions on councils buying empty property in good condition in the private sector. This would be the quickest acting emergency measure. Fourthly, we need the lifting of restrictions on the spending of capital receipts from, for example, the sale of council houses. The council has that money but is not allowed by the Treasury to spend more than about 20 per cent. of it per annum. That is manifest nonsense.
Fifthly, the Government should look at what other aid can be given under the urban programme and, of course, give partnership status to the borough. I have argued for that before.
Our problems have reached such outrageous proportions that only a partnership will solve them. If emergency action is not taken, the harrowing housing crisis in Newham will not go away, but will fester. Further constraint would result in diseconomies and more money wasted because forcibly ignored repair and maintenance problems will turn into major rehabilitation projects as houses are left to decay until demolition becomes the only option and the bed and breakfast bill mounts.
The Minister must appreciate that this would result in intolerable conditions for the borough's residents in both public and private housing sectors, and in turn lead to despair, vandalism, disincentive to private investment, and the downward spiral of inner-city decay from which Newham is desperately trying to escape.
I ask the Government to help, not hinder us. A programme like the one that I have outlined would, over a period of years, remedy our crisis. I ask the Government for a constructive, co-operative response and not for a dose of those Victorian values which condemn thousands of Newham people to Dickensian conditions this Christmas.