Mortgage Costs and Housing

Opposition Day – in the House of Commons at 3:30 pm on 13th December 1989.

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Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham 3:39 pm, 13th December 1989

I beg to move, That this House condemns the Government's responsibility for the growing housing crisis; deplores the rise in mortgage interest rates which has destroyed family budgets, cost some their homes and placed home ownership beyond the reach of others; warns that Government-inspired increases in council rents above the rate of inflation will cause hardship to many low-income people; deplores the Government's failure to maintain the condition of the housing stock and the consequent shortage of affordable housing; and believes that the scandal of growing homelessness is just the most visible sign of a wider housing failure. Of all the mistakes made by the Government, and there have been many, none is more resented, none is more painfully felt and none is more likely to cost the Government support than the steep and sustained increase in interest rates․a rise which in itself is an admission of economic failure and is a sign of desperation in the pursuit of economic policy, and a rise which has its most immediate effect, and does its most immediate damage, in its impact on mortgage rates.

The anger and resentment that that has caused are not just the result of the damage that it has done to family budgets, although that is real enough. Average monthly repayments for the country as a whole since May 1988 have risen from £259 to £347, an increase of no less than £88 per month. In London, the figures are even worse, because they reflect a rise of £162 per month. Increases of that magnitude will have shattered even the most careful of household budgets and will have plunged thousands of families into the most desperate of financial plights.

But the anger and resentment arise not just on that account, nor just because, for a tragic minority, the increase has meant the shock, despair and humiliation of losing their homes. In the first half of this year there were 6,350 building society repossessions. There is precious little comfort to be gained from the fact that that high figure represents a small decrease from the even higher figure of the earlier year or two; little comfort because the lower figure reflects the fact that building societies are playing a somewhat smaller proportionate part in the provision of mortgage lending, and even less comfort because, in prospect, the outlook is much grimmer.

Already we see the volume of mortgage arrears growing fast. In June this year, no fewer than 45,100 mortgages were between six and 12 months in arrears, which represented a jump of more than 20 per cent. What is already a grim reality for many people is rapidly becoming a frightening prospect for many more.

But the true reason for the widespread resentment and anger is the sense of betrayal felt by many thousands of people who recall that they were enticed on to that treadmill of spiralling house prices, of ever-rising mortgage repayments, by a Government who told them that we were enjoying an economic miracle; a Government who made them glib promises to the effect that home ownership was a risk-free one-way bet; but a Government who, with equal irresponsibility, threw everything into reverse when their own mistakes caught up with them and then blamed the victims of those mistakes for being so easily duped.

It is the Government's heartlessness, their almost moralistic zeal in turning the screw, which has added insult to injury, and it is that which has created mortgage misery for millions. In case anybody thinks that that easy alliteration conceals nothing much, let us be clear that it conceals a true degree of desperation. It is that desperation which has made home ownership an impossible dream for some and an impossible nightmare for many more.

It is not just mortgage payers who are suffering. Tenants, too, find that their housing costs are going up sharply. It is not surprising that tenants feel somewhat aggrieved at what they consider to be the excessive attention paid to the interests of mortgage payers. They, too, find that housing costs are rising inexorably against them. Council tenants have been put on notice by Ministers․including the Secretary of State․that the Government intend to force their rents up to near market levels. The new subsidy arrangements and the ring-fencing provisions of the Local Government and Housing Act 1989 mean that the Government now have the power to make their writ run, whatever local democracy may require or suggest. Council rents are set to rise much higher than the inflation rate, often against the wishes of local authorities and almost always against the interests of some of the lowest-income families in our society.

At the same time, private sector rents will also rise sharply. The Housing Act 1988, which allows market rents to be charged in place of fair rents and reduces security of tenure, is just beginning to have its malign effect. What that will mean in terms of affordable housing is clearly shown by a survey commissioned by the Department of the Environment and carried out by Price Waterhouse, which was published in August. It shows that a married couple with two children and an income above the qualifying level for housing benefit would be able to afford a market rent for a two-bedroomed house in only two cities in the country․Leicester and Newcastle. For the rest, market rents will mean that private rented accommodation is placed beyond their reach. That is a prime instance of the futility of looking to the market to meet unmet housing needs.

Even housing associations, which are now looked to by the Government as the instrument of salvation, will find that their rents will rise as they are forced to turn to private sector funding. It is little wonder that over the past year housing association rents have risen by no less than 24 per cent.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

Is my hon. Friend aware that, in the London borough of Newham, we will be faced next April with rent increases of about 21 per cent. because of Government diktat? Is he also aware that, because of the benefit changes last April, rent arrears—not only in Newham but throughout the whole of London and the country․went up by an average of 38 per cent.? What impact does he think that this enforced rent increase will have on rent arrears throughout the country?

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

My hon. Friend lends detail and substance to the point that I am making. His experience in his borough is echoed and repeated up and down the country ․certainly in my part of London. He is right to point out that rent arrears have risen and the difficulties have become manifest before the real impact of the recent changes has been felt. Therefore, as I have argued on other issues, the prospect is even grimmer than the current reality.

Wherever people turn, as owner-occupiers or tenants in the public or private sector, they find that the cost of housing is moving sharply and inexorably against them. That is sometimes because of deliberate and direct Government policy․as with the recent legislation—and sometimes because the market is distorted by the excessively high interest rates imposed by the Government.

However, affordable housing is a matter not just of price but of supply. Here, too, the record of the Tory Government is appalling. Housing completions have fallen steadily throughout the decade. In the public sector, they have fallen from 113,800 in 1978 to just 24,800 last year. The total number of housing completions has fallen also․from 240,800 in 1978 to just 184,600 last year. Those figures complete a picture of a grim decade for house building. Worse is to come. I expect the Minister

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

Is the hon. Gentleman aware that 2 million houses have been built in this country since the Government took office? Does he regard that as a record of failure in house building?

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

I am grateful to the Minister for putting the question in that direct and simple way because I can give him a direct and simple answer. Yes, that is housing failure. When it is measured against the unmet housing need․which I will come to shortly․the record is appalling.

It is far worse than the house completion record under the Labour Government. The Government having decimated․in literal terms, having far more than decimated․public sector house building, the prospects for the Government's policy on private sector house building are equally grim. Even the brief 1988 revival in private sector house completions has come to a sticky end as the construction industry grapples with the full brunt of high interest rates. During the first six months of 1989, there was a 17 per cent. slump in private sector housing building. Comparing the second quarter of this year with the second quarter of 1988, we see that fully a fifth of what was then achieved has been lost.

It is hard to understand how value added tax on new domestic house construction will help. I, in common with many others, felt a sense of alarm when the Secretary of State failed earlier this afternoon at Question Time to rule out in absolute terms any willingness by the Government to accept diktats from the Commission in Brussels.

Photo of Mr John Heddle Mr John Heddle , Staffordshire Mid

I am grateful to the hon. Gentleman for giving way on this point, because it was the reply to my question to my right hon. Friend the Secretary of State for the Environment to which he has just referred. My interpretation of his answer was not quite the same as the hon. Gentleman's. My right hon. Friend said that he would consult his right hon. Friend the Chancellor of the Exchequer to ensure that all possible opposition was mounted if the EC threatened to impose VAT on domestic house construction. The hon. Gentleman is a responsible Member of the House. He should not try to attach such a dishonourable interpretation to my right hon. Friend's answer.

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

I bear with equanimity the fact that the hon. Gentleman's interpretation and my interpretation of what the Secretary of State said are different. We start from different points of view. The hon. Gentleman is intent upon finding the most favourable interpretation. However, the hon. Gentleman has gone even further. Perhaps he should have given the answer at the Dispatch Box; it would have been a much better answer than that given by his right hon. Friend the Secretary of State, I have no doubt that the hon. Gentleman is fair and honourable. I am sure that he will concede when he consults Hansard tomorrow that he added substantially to his right hon. Friend's answer and that my interpretation was exactly correct; that the Secretary of State promised only to consult the Treasury and that he gave no assurance, either on his own behalf or that of the Department or the Government, that he was implacably opposed to the imposition of VAT on domestic house building.

Housing costs have risen. Housing supply, in terms of new build, has fallen below what we have a right to expect. Housing supply is not just a matter of new build; it is also a matter of the condition of the existing housing stock. The brutal fact is that the condition of the existing housing stock is growing worse. There are now 2,400,000 houses in serious disrepair, or 13 per cent. of the total. To put those houses into proper repair would cost an estimated total of £30 billion. That is a shocking record for any civilised country, but it is especially shocking for a country and a Government who have enjoyed over £120 billion of North sea oil revenues. Surely the Government ought to have spent some part of that bonanza on providing decent housing for all our citizens.

The failures have not happened by accident. The problem is․we have had 10 years' experience of it․that the Government prefer dogma to decent housing. They are prepared to carry on a war of attrition against the most obvious and efficient instrument for the provision of housing, particularly for low-income families․the local authorities. The homeless and the badly housed are the innocent victims of that unilaterally waged war.

Local authority housing investment programme spending has fallen consistently over the past decade. In 1980–81, it was £3·37 billion, in 1982–83 it was down to £2·84 billion, and by 1988–89 it had decreased to £1·12 billion in total. The most lunatic expression of the Government's vendetta against local authorities and their role in the provision of housing concerned the spending of capital receipts. The councils have £ 8·5 billion of capital receipts which they want to spend on improving housing stock and housing provision. Incredibly, they are prevented from doing precisely that by central Government diktat.

I hold a regular surgery in my constituency, as I am sure most hon. Members do. Perhaps 80 per cent. of all those who come to see me have housing problems. The inability of hon. Members to deal with those problems is one of the most worrying aspects of our job. I rarely conclude my surgery, which can go on for many hours, without a feeling of desperation and sadness that I can do so little to help. When people come to me and say, "Why can't the local authority spend a little more on putting my house into proper repair; why can't they build a few more flats for young married couples; why can't they spend some of the money that they must have received from the sale of council houses and council property?", I tell them that local authorities are not allowed to do that, as the Government have consistently prevented them from spending more than 20 per cent. of their receipts on those obvious and worthwhile purposes.

Almost invariably, my constituents look at rue pityingly. One can see the disbelief spread across their faces. They think, "Here is yet another politician flannelling on about absolute nonsense." They cannot believe that any Government could be so misguided and illogical as to impose such a stupid and damaging restriction.

Photo of John Maples John Maples , Lewisham West

Most of my constituents who come to see me also have housing problems. What they have in common with the hon. Gentleman's constituents is that they are tenants of Labour authorities. Can he explain why the vast majority of empty houses, outstanding repairs and uncollected rents are in Labour-controlled areas?

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

That is a familiar canard. The rate of empty property in local authorities is lower than it is in housing associations and in the private sector, and substantially lower than it is in the rest of the public sector, where Government Departments predominate.

A housing crisis is building in Britain. Any conscientious Member of Parliament who carries out regular constituency surgeries will have seen the evidence. Those hon. Members who profess to be unaware of the growing housing crisis, the housing time bomb that is ticking away, must be uniquely advantaged and live in the most prosperous parts of the country, because elsewhere a growing tide of humanity is condemned to a miserable, depleted and distorted existence because people do not have proper housing.

Undoubtedly the most tragic victims of the housing crisis are the homeless. Let no one say that there is no homelessness crisis in Britain. Last year, 117,550 families were accepted on to homelessness lists. That means that 337,369 people are homeless. Even that figure is dwarfed by the 242,000 families that applied for the status of being homeless. Homelessness is not a problem only in London. It is a problem in Gateshead, where homelessness has risen by 27 per cent. in the past year. In Colchester, it has risen by 48 per cent. and in leafy Salisbury by 52 per cent.

Those appalling figures do not include the most distressing manifestation of homelessness. The young people who are forced to beg by day and to sleep on our streets by night are not included in the figures, yet they are part of the daily experience of everyone who walks the streets of our major cities, particularly our great capital city. They are a blot on the face of this country and in particular on the Government's record. It is a sight that we had assumed had been pushed unmourned into the less salubrious pages of our history. Faced with that problem, the £250 million spread over two years which was announced in the Autumn Statement is no more than a drop in the ocean. It is totally inadequate to deal with the size and the seriousness of the problem of homelessness.

This problem has not arisen by accident. Homelessness is simply the most visible sign of a wider, deeper housing failure. A housing failure is not just an ordinary failure of Government policy; it is a failure by the Government to fulfil one of their basic duties to the people. There is something peculiarly shocking about the failure of a rich, self-proclaimedly civilised country that fails to provide a decent roof over the head of each of its citizens.

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

I am about to finish.

There is nothing more fundamental to human dignity than a house of reasonable comfort and security.

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

I am about to wind up.

There is nothing more destructive of family cohesion or individual self-respect than condemning people to unacceptable housing conditions.

The solution clearly requires a fundamental reappraisal of many aspects of policy․the growing regional imbalance, the failure to use planning law to establish adequate new provision of housing, particularly in the south-east, the allocation of resources both between housing and other services and within the housing budget between owner-occupiers and others. Of course the solutions require fundamental reappraisal, but much more immediate steps can be taken․the reversal of the serious and avoidable mistakes in housing policy which have been made by the Government and which have made our housing conditions in modern Britain not just a crisis but a scandal.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing) 4:01 pm, 13th December 1989

I beg to move, to leave out from "House" to the end of the Question, and to add instead thereof, welcomes Her Majesty's Government's commitment to home ownership throughout the last ten years which has enabled many more people to own their homes; recognises the benefits which have resulted from the introduction of the Right to Buy for council tenants; further recognises that the Government's sound economic policies have played an important part in facilitating the growth in owner-occupation; and urges the Government to maintain those policies in the interests of home owners, first-time buyers and the nation as a whole. In common with speeches that we are accustomed to hearing from the Labour Front Bench, that of the hon. Member for Dagenham (Mr. Gould) was long on a description of problems, much of it inaccurate, and short, almost to the point of non-existence, of any suggestion as to how he and his party would set about tackling those problems. It was so lacking in any substance that, as a serious contribution to debate on housing policy, it was little short of a disgrace.

We should not be too hard on the hon. Gentleman, because we know what trouble he gets into when he embarks upon the task of suggesting what policies might be used to deal with these problems. We know of his contributions to clarifying the Labour party's policies on housing, even before he was given his present responsibilities. His television appearances on these and other matters have become collectors' items, and we greatly look forward to more.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

I am coming to that. I am interested in dealing with policies. Thanks to Brian Walden's revealing interview with the hon. Member for Dagenham, we know what the hon. Gentleman's policy would be—to target and penalise all those who seek to move to a larger house. People with growing families would bear the brunt of the policies which the hon. Gentleman did not dare mention during his long speech this afternoon.

The hon. Gentleman even had the good grace during the interview to tell these growing families that, although they would be "hit", they would be "fully warned", and, in any event, his proposal was "in their interests". He finally assured them that their inability to house a growing family would be simply a "fairly marginal impact" of Labour's policies. The hon. Member for Dagenham was advocating direct controls on mortgages.

None of us should be surprised by such an approach, because it is the approach of the Socialist down the ages. Socialists believe that, if one sees a problem, one should slap on a control and form a queue. The Labour party is never happy without a queue or two, or preferably three or four. It satisfies its natural predilection for the hair-shirt. Its approach has always been that if everyone cannot have something, it should ensure that getting it becomes as painful as possible for those who can.

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

The Minister mentioned hair-shirts. Has he bothered to ask himself how many of his own constituents are obliged to wear the hair-shirt because of the Government's policy of high interest rates? How many repossessions have occurred in his constituency, or has he not bothered to find out?

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

I am well aware of the problems. I shall deal with them in my speech, and I shall deal with high interest rates as well. The hon. Member for Dagenham has clearly advocated the imposition of physical controls on those who wish to move into a larger house because they have a growing family. That is his policy, which was announced clearly in the interview to which I referred. It is right that we should all know about it, and that none of us should be under any misapprehension.

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

I had hoped that the Minister would not pursue this futile course for much longer, but as he insists on misdescribing what I have said․and what many others beyond the Labour party have said, including many Conservative Members․I must make it clear that we have always sought not to prescribe policies for 1991 or 1992, when a Labour Government will at last come to the rescue of the British people, but to rebut the suggestion that is constantly put from the Dispatch Box that there is no alternative to high interest rates.

There is a huge consensus across the board, embracing hon. Members of all parties, including some of the Minister's hon. Friends, that the Government are wrong to impose mortgage misery on so many people on the pretext that there is no alternative but high interest rates. The last thing that I․or anyone else․has done is to prescribe policies in this respect for the next Labour Government. We are saying that at present, in the dilemma and mess that have been created by this Government, it is simply not the case that there is no alternative to high interest rates.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

The hon. Gentleman has a short memory. I have here the full transcript of his interview with Brian Walden, in which he clearly and specifically set out his alternative to higher interest rates. His alternative was the imposition of direct controls on the amount that a person could borrow if he wanted to move into a larger house. I want to pay tribute to the hon. Gentleman. His great merit ․although I am sorry to see him resile from it somewhat this afternoon․is candour. He is very open about these matters.

Some Labour Members find the hon. Gentleman's approach uncomfortable. The right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) could not wait to slap down the hon. Member for Dagenham. He went on to the Walden programme the next week․the earliest possible opportunity․to disown his hon. Friend. He said: there is no way in which we are going to penalise a family which wishes to buy a larger house". The right hon. and learned Member for Monklands, East (Mr. Smith), the shadow Chancellor of the Exchequer was equally unhappy. He put forward his own remedies. He has it in mind to solve the difficulties by entering into a social contract with the clearing banks. He would not come forward with straightforward controls, as the hon. Member for Dagenham did. The right hon. and learned Member for Monklands, East believes that he could achieve the same objective by nudges and winks, and by backdoor deals with the bankers. I congratulate the hon. Member for Dagenham on his straightforward approach. It was no doubt his remarks that the hon. Member for Hammersmith (Mr. Soley) had in mind when he wrote a letter to Roof, the magazine of Shelter, in which he said: Our plans for owner-occupiers are not for the fainthearted.

Photo of Mr Roland Boyes Mr Roland Boyes , Houghton and Washington

If the Minister proposes to speak for the same length of time as my hon. Friend the Member for Dagenham (Mr. Gould), he must now be more than halfway through his speech, yet he has not touched on the greatest problem of all in our society, which is the large number of homeless people. What attempt has he made to count the number of homeless people, especially in London, and what measures does he propose to take to do something about it? Is he aware that one telling manifestation of this great sickness in the Government's policy is that nearly every evening someone sleeps right outside the Palace gates? Is not that a disgrace, and is it not time that the Minister reached the part of his speech dealing with the subject about which people want to hear?

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

Homelessness is an aspect of the problem which we must take very seriously indeed and with which I shall certainly deal during my speech. But we do not get anywhere by describing problems without advancing solutions to them. The hon. Member for Dagenham spent his whole speech in an inaccurate description of the problems without giving us so much as a paragaph of solutions.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

You have already said that.

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. If the Minister does not wish to give way, hon. Members must restrain themselves.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

It is on a point of order, Mr. Speaker.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

Mr. Speaker, we have a Standing Order that requires hon. Members to desist from persistent repetition. We have already heard, on four occasions, the Minister's attack on the Labour party, and we are anxious to hear what the Government propose to do. I invoke your support, Mr. Speaker, because tedious repetition is out of order.

Photo of Tony Baldry Tony Baldry , Banbury

On a point of order, Mr. Speaker. I am a little confused. Although I have been in the House for six years, I do not seem to have caught up with things. I thought that today was an Opposition Supply day and I thought that those were the days on which the Opposition, in addition to attacking the Government, helped the House towards a better understanding of their policies. I came here this afternoon in the hope that I would be educated about the Labour party's housing proposals. So far, I have not heard one scintilla of a positive suggestion of what the Labour party intends to do in its housing policy or of how it would cost its proposals.

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

That is more a debating point than a point of order.

A propos tedious repetition, if I had judged that there was tedious repetition, I would have intervened, but I did not judge it. We should get on with the debate. A great many hon. Members wish to participate, and if the Front Bench spokesmen are constantly interrupted, other hon. Members may be disappointed.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

It is precisely because of the omissions of the hon. Member for Dagenham that it falls to me to tell the House what the Labour party's policy would be, and that is what I have been trying to do.

Our policies for owner-occupiers could not represent more of a contrast with those of the Labour party, and our approach has been proved effective by 10 years of success. Since 1979, the proportion of owner-occupied households has increased from 57 to 68 per cent. We have one of the highest rates of owner-occupation in the world—higher than that in the United States․and the number of first-time buyers in 1988 was about double the number in 1979.

About 6 million people have bought their own homes for the first time over the past 10 years․more than I million of them under the right-to-buy provisions against which the Opposition fought so bitterly. The Labour party would still interfere with the unrestricted right to buy. The housing resolution passed by the Labour party conference in October supported the right to buy, providing that the local authority replaces the stock sold, and those wishing to resell allow the Council first option to buy. The Labour party has still to come to terms with the undoubted aspiration of the vast majority of people in Britain to own their own homes. That is an aspiration which the Government unequivocally welcome and will do their utmost to assist.

I acknowledge that many home owners find the present level of interest rates very difficult indeed, but that difficulty must be seen in perspective. It would be wrong to make any simplistic links between mortgage interest rates and homelessness. There are many causes of mortgage arrears other than high interest rates. One of the most significant of them is unemployment, and the reduction in unemployment by 1·5 million since 1986 has significantly helped the overall picture on mortgage arrears, as it has helped in so many other ways.

Clearly, we have nothing to learn from the Opposition about owner-occupation. We promote it, and they obstruct it, and the sooner that people understand that difference, the better.

When we last discussed housing, the hon. Member for Hammersmith alleged that the right to buy was the Government's sole housing policy. That is also a travesty. During the next three years, total central Government spending on housing and their grants and credit approvals to local authorities for housing will add up to almost £20 billion. That sum of money will largely benefit the minority of the population who are not owner-occupiers. I hope that even Opposition Members will acknowledge that £20 billion is a large sum by any standards. It is worth noting that no sums are mentioned in the Opposition's policy review.

Opposition Members come to the House day after day, promising to spend more on houses, as well as everything else under the sun, but the shadow Chancellor constantly says that any extra spending would have to await the creation of additional resources. The promises of the Opposition are not worth a row of beans. We do not rely on promises, we rely on action․£20 billion worth of action.

Photo of Mr Peter Thurnham Mr Peter Thurnham , Bolton North East

My hon. and learned Friend is talking about resources. Will he bear in mind the need for a balance between new housing and the environment? If my constituents are successful in their High Court battle with Barratt's today, will he remind Bolton's Labour council of its duty to defend covenants and to ensure that Birtenshaw farm remains free from development?

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

I will not be drawn into making comments about a case that is before the High Court today, but I know how hard my hon. Friend has fought for the cause of his constituents.

We acknowledge that owner-occupation is not the answer for a minority. Some people do not want, or cannot afford, the responsibility of home ownership. That is why we are working to restore quality, diversity and choice to the residential sector. The deregulation of new lettings in the Housing Act 1988 will help to revive the private rented sector, which was almost entirely killed off by the rent controls introduced by successive Labour Governments.

Already, some £350 million has been invested in business expansion schemes to provide private sector tenancy lettings. Private sector finance is now being attracted to support housing association projects.

The Opposition want to destroy that revival. The hon. Member for Hammersmith conceded in the Financial Times last year that some private investors may be frightened of investing in rented houses when they realise that a Labour Government would impose rent controls. Some? All private investors would be frightened, and the revival would be utterly destroyed. Not only would the Labour Government reimpose rent controls, but tenants of non-residential private landlords would be given the right to buy, or to transfer to a council landlord.

Do Opposition Members believe that any of Labour's policies to penalise the private rented sector would encourage investment in it? How can they endlessly bang on about housing shortages, but at the same time make proposals that by their own admission would scare away much-needed investment in housing? If people who can afford market rents choose to rent privately and withdraw from the market, they will release more subsidised rented homes for those people who are most in need. That is an objective which should be encouraged by hon. Members on both sides of the House.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

In the private rented sector, there has been an increase in the number of houses available for rent, because people have had to move out when they cannot afford to keep up with the mortgage payments. Estate agents have put houses that are up for sale in to the rented market. That increase has happened by default.

Can the Minister explain another statistic? Ten years ago, nine families were in bed-and-breakfast accommodation in Newham; now, the number is 1,151, yet only 3·5 per cent. of our own housing stock is vacant.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

If the hon. Gentleman examines the statistics on repossessions and the causes for them, he will see that the assumption that lay beneath the first part of his question is without any foundation whatever. The facts simply do not support it. It is typical of Labour's approach that its one and only solution to the problem of housing shortage is to increase our municipal housing stock, although we already have the largest in western Europe.

Photo of John Battle John Battle , Leeds West

What about bed-andbreakfast accommodation?

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

I am coming to that.

Our approach is to encourage choice in the social rented housing market. We do not want to increase the number of monolithic council housing estates or to strengthen local authorities as the monopoly suppliers of rented housing. That is why we want new provision to come primarily from housing associations.

In the next four years, we shall more than double the Housing Corporation's main programme, from £815 million this year to more than £1·7 billion by 1992–93. That should permit a doubling of output to about 35,000 dwellings in that year alone. Such steps to increase the supply and diversity of rented accommodation will help to tackle the imbalance between supply and demand, which is one of the causes of homelessness.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

I hope that my hon. Friend will forgive me, but I must press on.

In the meantime, we fully acknowledge that further immediate action is required to help the homeless. That is why we are providing an extra £250 million over the next two years for local authorities and housing associations in stress areas. Those additional resources should provide approaching 15,000 extra lettings. That should be compared with the total number of families in bed-and-breakfast accommodation, who number about 12,000. That is our response to this problem. It is a serious response and on a considerable scale. It will have a considerable impact.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

The motion refers to the Government's alleged failure to maintain the condition of the housing stock. The hon. Member for Dagenham said that its condition was getting worse, but he failed to support that assertion with one piece of evidence. He is wrong: nothing could be further from the truth.

There are 2 million more houses in England today than there were in 1979, and the English house condition survey shows that, between 1981 and 1986, the number of dwellings that lacked basic amenities fell by no less than 41 per cent. That gives the lie to the hon. Gentleman's assertion. Moreover, there has been continued improvement since 1986, so there is not a shred of evidence to support the assertion in the Opposition's motion. It is a typical piece of undiluted scaremongering, and I hope that, on reflection, the hon. Member will have the decency to recognise that and to withdraw it. I give him the opportunity to do that now.

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

Will the Minister enlighten us by telling us the number of houses that are in serious disrepair?

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

The hon. Gentleman's argument was that matters are getting worse. [Interruption.] I challenge him to produce one piece of evidence in support of his assertion that matters are getting worse. [Interruption.] He cannot do so. His silence speaks volumes. [Interruption.]

We suggest that more should be done to improve things. Unlike the Opposition we make no apology for concentrating assistance on people in greatest need. [Interruption.] We have acted․ [Interruption.]

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. Let us have an end to this running commentary. It does not help the debate at all.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

We have targeted home improvement grants on people on the lowest incomes. We have almost doubled the amount of money available for home improvement grants, and now we are ensuring that the increased resources go to those who need them. Labour's policy review says: We will review the renovation grant system so that it relates less to people's means. That is a typically cockeyed approach.

We have established programmes for Estate Action and housing action trusts that will provide huge additional resources for the most rundown inner-city council estates. Yesterday in Sunderland I announced the appointment by my right hon. Friend the Secretary of State of the first shadow chairman of a housing action trust. I also visited Hartlepool, which I understand is a town of particular interest at the moment to those in powerful places in the ranks of the Labour party. On one estate alone in Hartlepool, we have made available £3·5 million over three years to improve the conditions of the people living there. Those improvements are dramatic and have transformed the lives of those people. While the Opposition table carping, whingeing motions, we are getting on with the business of improving people's housing standards.

Photo of Mr Bryan Gould Mr Bryan Gould , Dagenham

The Minister challenged me to produce figures to support my contention that the condition of the housing stock has got worse. If he will look at the figures for dwellings in serious disrepair, he will see that in 1976 there were 859,000 such houses, representing 5 per cent. of the total; that in 1981 there were 1,178,000 such houses, representing 6 per cent. of the total; and that in 1986 there were 2,400,000 such houses, representing 13 per cent. of the total.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

I do not accept those statistics. A much more accurate way of looking at this matter is to consider the proportion of houses lacking basic amenities. If the hon. Gentleman looks at those statistics, he will find that there has been a considerable․indeed, a dramatic—improvement in the condition of the housing stock during the lifetime of this Government.

At the centre of the debate is the issue of high interest rates and the problems that they cause homeowners. I readily acknowledge the hardships that such a level of interest rates causes. My right hon. Friend the Chancellor has often made it clear that high levels of interest cause difficulties but that interest rates must and will remain high until inflation has been brought back down. Persistently high levels of inflation, such as those that we experienced under the last Labour Government, would hurt everyone in the country, and homeowners would certainly not be exempt. It is wholly in their interests for a tight rein to be kept on inflation, and that we are determined to do.

As we have seen, the Labour party has no coherent policy to deal with inflation. However, apparently one oil' its few clear policies on housing, which has been referred to by the hon. Member for Dagenham and was set out in a letter written to me last week by the hon. Member for Hammersmith, is to allow local authorities to spend all their capital receipts on housing.

It is an interesting reflection of Labour's long-trumpeted commitment to a regional policy that this commitment would unleash about £8 billion of spending power, which would be concentrated largely in the south-east of England. Indeed, the hon. Member for Hammersmith had the grace to admit at a press conference last week that removing restrictions on the expenditure of capital receipts would produce clear inflationary pressures. It is not surprising, therefore, that that policy is not even mentioned in Labour's policy review. Indeed, Roof magazine noted: Labour's review sadly does little more than express worthy sentiments in a bubble bath of irrelevant platitudes.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

The hon. Gentleman will have his opportunity later—

Hon. Members:

Give way.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

No, I shall not give way. The hon. Gentleman will have his opportunity later.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

I am nearly at the end of my speech, and I am not giving way.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

The hon. Gentleman will have his opportunity to make his speech in due course— [Interruption.]

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

If the Minister will not give way, I shall have to raise the matter on a point of order—

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

I regret having to raise this on a point of order, Mr. Deputy Speaker. I do not mind being quoted, but I object to not being quoted anywhere near accurately. I said that the £8 billion would not and could not possibly be used in one year. If it was, it would be inflationary, but I said that there was no possibility of that. That is the accurate quote.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

The hon. Gentleman's policy is to allow the money to be spent as fast as it can be. That would lead to inflation. It is absolutely clear from what the hon. Gentleman said that the policy would lead to inflation, and that he recognises that.

It is clear that the Labour party will pursue policies on housing, as on other matters, that will inevitably fuel inflation, and it knows that. The Government will continue to pursue sensible housing policies to improve people's housing conditions. I invite the House to support the amendment.

Photo of George Howarth George Howarth Shadow Spokesperson (Environment, Food and Rural Affairs) 4:30 pm, 13th December 1989

It would be interesting for my hon. Friends to read the terms of the amendment, which refers to just one aspect of Government policy․owner-occupation, or the right to buy. That is fairly revealing. The failure of the Government's policy on housing is that until comparatively recently they felt it necessary to have a policy on only one aspect․owner-occupation. That policy started to come unglued in about 1985.

The housing portfolio changes hands so often in this Government that it is difficult for any Minister to get his feet under the table and become properly briefed before being sent off to do something else. The Minister can therefore be forgiven for not understanding all the statistics because he has not been in his post long and, no doubt, he will not remain there for long. The reason why the Government decided to extend their interest in housing policy beyond owner-occupation was purely economic. Some economists started to advise them that one of the problems that people moving particularly to the south-east, following the advice of the right hon. Member for Chingford (Mr. Tebbit) to get on their bikes, was that there was simply not enough rented accommodation available. That was the origin of the Housing Act 1988, and I and many of my hon. Friends served in Committee on that measure. That was the only reason why the Government decided to take any interest in rented housing.

Several of my colleagues want to speak, so time prevents me from detailing all the objects of the 1988 Act, but the main thrust of the Government's policy was to expand the supply of rented housing outside the public sector as it was then defined. In addition, in relation to local authorities, they wanted to deregulate the housing market and create various devices to break down what they regarded as local monopolies of council housing.

However, none of that adds up to a housing policy. The Government have not addressed the real problems in housing, which we shall describe in the debate. Even in their approach to the 1988 Act and the more recent Local Government and Housing Act 1989, the Government have not succeeded in achieving any constructive progress towards building up a coherent housing policy. The policies that they have implemented, piecemeal as they are, have not and will not succeed in solving any of the serious housing problems.

In this debate, my hon. Friend the Member for Dagenham (Mr. Gould) has described some of the problems within the local authority sector and the growing problems of disrepair across the range of tenures. The Minister challenged my hon. Friend to produce figures, which he ably and quickly did, disproving the Government's argument․whether or not the Minister accepts the figures.

I have the December edition of the Institute of Housing's excellent magazine "Housing". I hope that the Minister will accept that, by and large, the institute is an impartial organisation which looks at the facts and tries to inform professionals and others interested in housing issues. The magazine contained a supplement dealing with the Autumn Statement and the Government's approach to housing, and to some extent I shall rely on that information. The Autumn Statement contains all the Government's proposals for spending on housing, which are set out in great detail. The supplement says: Some £3 billion per annum is needed to deal simply with the backlog of disrepair, defects and modernisation of local authority housing stock, let alone to deal with homelessness, housing needs and the condition of private housing. That is an unbiased conclusion about the Government's proposals. The Minister spoke about some of the initiatives that the Government have taken. On occasion I have supported them and praised Ministers and Departments when the initiatives have been usefully applied.

I mention a constituency matter to illustrate one of the difficulties arising from a piecemeal policy and no coherent approach. Some of the programmes start off well and with good intentions, but changes in priorities are often applied in a state of panic because something has gone wrong and the good intention of the new programme drifts into the sand.

On the Tower Hill estate in my constituency an effective Estates Action programme supported by the residents, the local authority and the Minister's Department has been running for three or four years. In connection with that there was probably the most detailed consultation exercise ever undertaken there. The consultation revealed that residents wanted improvements in the way that the estate was laid out and wanted some of the design problems put right. However, there are more problems than that on the estate. There is a lack of leisure facilities and economic opportunities for residents.

The action programme is about 50 per cent. of the way through and many improvements have been carried out. In response to such residents the Government extended the guidelines and I am sure that an application will soon reach the Minister's desk because the residents are looking for what they describe as multi-faceted schemes which involve an economic development initiative and an increase in leisure facilities. We are now told that, because the guidelines have been extended precisely to cater for schemes such as the one at Tower Hill, we will have to compete with other authorities which have applied for similar schemes.

I repeat that the Tower Hill scheme is 50 per cent. completed but all the pioneering work carried out in my constituency will come to nothing because the rules have been changed and the goalposts moved, so all the benefits of the scheme will be lost. 1 hope that when the application reaches the Minister he will look at it in that light and decide that the pioneers of such schemes should be supported until the job is finished.

The Minister may be aware that the hon. Member for Ealing, Acton (Sir G. Young), who is in the Chamber, and I have taken an active interest in housing co-operatives. Last year the Government produced an excellent document when the Minister's noble predecessor was in post. That document set out in some detail what should happen to housing co-operatives. My latest information is that because of the use of private finance, on which I have recently tabled questions, and especially in view of the guidelines that the Housing Corporation has recently sent out about how private finance should be tackled by housing co-operatives and associations, housing cooperatives will encounter grave difficulties in securing the private funding that they need to get their schemes off the ground. That is because they have no asset base.

There is all-party support for housing co-operatives and there is an all-party parliamentary group on the subject. If the amount of private money that the co-operatives can raise is restricted and the grant is insufficient to meet the deficiency, the co-operatives will have to move towards design-build packages. That means that one of the great benefits of new-build and rehabilitation co-operatives․control of the design process ․will be lost. I understand that there has been toing and froing and that disputes have occurred within the Housing Corporation board about how to handle the matter. I hope that the Minister will deal with it at some point. All the benefits and experience built up in the housing co-operative movement over the years could be lost if someone does not take the problem by the scruff of the neck and sort it out so that housing co-operatives can continue to produce the goods and important urban renewal initiatives in inner cities and outer estates. That is what they are good at and what they have achieved.

We all accept that a high level of homelessness is unacceptable in a civilised society. If one moves around London and other major provincial cities on any night of the week, one sees young people sleeping on the streets. Some may have drug and alcohol problems, which we all accept are difficult to resolve because they fall outside the scope of the main agencies, but many young people from my constituency and from those of my hon. Friends and of Conservative Members come to London because they are unable to secure employment in the north of England in some of the real economic black spots. When they arrive they find themselves in a double blind. If they do not have an address they are not taken seriously when they apply for jobs, and if they do not have a job they have difficulty securing accommodation, so they end up sleeping in cardboard boxes on the Embankment or in other places both in summer and on cold winter nights. It is an appalling condemnation of society that that should happen in this decade.

What are the Government's proposals on housing the homeless? What do they mean? What will they produce in terms of initiatives? I draw the attention of the House to a submission in the Institute of Housing magazine, "Housing", which says that the Government's proposals do not add up to much. They do not make up for shortfalls in the housing investment that would have been necessary to head off the problem of homelessness in the past decade, so they will not resolve the problem of homelessness. That is the opinion of experts in housing whom the Government should heed and respect.

I wish to refer to some of the other issues raised in the Housing Act 1988. Much play was made of the fact that problems on housing estates and in inner city areas would be resolved by housing action trusts. The Minister announced such a trust for Sunderland today. Much play was also made of other proposals in part IV of the Act. Yet week by week we read in the housing press headlines such as: Essex tenants vote to stay". That article says: Redbridge LBC tenants in Ilford voted by 5,418 to 2,780 against the plans to transfer the housing stock to Oakbridge Housing Association … Brentwood district council also rejected transfer plans, by 2,953 to 708.

The Government have not realised that although people may quibble and criticise their local authorities they know, as we constantly said in the debates on the 1988 Act, that if they want to change the way in which the local authority housing department is managed they at least have recourse to the ballot box at local elections. They can say, "You have failed, so we shall put in another party." That right of council tenants who opted not to exercise the right to buy is of more worth to them than their trust in any other organisation, no matter how worthy.

The Government have clearly failed. They have not been inundated with requests from local authority tenants to transfer to housing associations or other organisations. They have not even been inundated by requests from landlords to register as approved landlords under the scheme provided for by the Act and run by the Housing Corporation. That part of the Act, which was almost the flagship of the Government's privatisation plans for housing, has been a complete and utter flop.

It is about time that Ministers and those who support them accepted that the measures introduced do not add up to a housing policy. There is no strategy. They are just playing politics with housing. They have very little to show for their efforts and that will continue to be so.

The Government set great store by their dealings with housing associations, but what is likely to happen to those bodies? The Autumn Statement contained some good news. I acknowledge that additional resources were put into the pot, but there are still problems. The Minister must be aware that many small housing associations are suffering the same difficulties as housing co-operatives in that they do not have the asset base to make proper use of the present scheme. The Government's attempts at a de facto privatisation of the housing association movement is likely to drift into the sand. The Government will probably have to increase the proportion of housing association grant, thereby undermining their own strategy to put the movement into the private sector. Their plan does not work for the smaller housing associations. If the Government do not do something to resolve the problems of small associations, they will end up with a series of local monopolies by large associations.

The Minister's last but one predecessor heralded small community-based housing associations as a wonderful innovation in inner cities, but if something is not done they will disappear completely. The Government must take action to increase the housing association grants to a level at which the private finance involved is negligible. The Institute of Housing says: Even with such a grant rate increase, however"— the institute believes that it should be increased to 80 per cent.— new housing association lettings are likely to be at rents well above the National Federation of Housing Associations `affordability' guidelines. Even if the Government increase the level of housing association grants, the amount of rent charged will be too great. The Government have failed across a whole range of policies because they have no policies. Their failure in housing is one of the most important among many failures which, in the near future, will ensure that my hon. Friends are on the Government Benches and the Conservatives on the Opposition Benches.

Photo of Mr Harold Walker Mr Harold Walker , Doncaster Central

This is a short debate. Unless speeches are short, I am afraid that some hon. Members will be disappointed.

Photo of Mr John Heddle Mr John Heddle , Staffordshire Mid 4:48 pm, 13th December 1989

The title of this brief debate is, "Mortgage costs and housing." I shall address my remarks particularly to mortgage costs and the plight of home owners who have borrowed more money than they prudently might have done. Perhaps I should declare a non-pecuniary interest as vice-president of the Building Societies Association.

Before you came to the Chair, Mr. Deputy Speaker, there was an exchange of views between myself and the hon. Member for Dagenham (Mr. Gould) on the imposition of VAT on non-domestic construction work. I take this opportunity to say that it is the duty of all hon. Members who take an interest in the construction industry and the provision of housing to anticipate events. It was in that context that I raised the matter in Question Time today.

Only six or seven brief years ago, as my hon. Friend the Member for Ealing, Acton (Sir G. Young) will recall and confirm, the Government's view was that there would be no question of VAT being imposed on non-domestic construction work. Because of the rules of the European Court that have been passed down to us, we must impose VAT on non-domestic construction work. Post-1992 there is a strong possibility that the European Court will force the United Kingdom Government to impose VAT on domestic construction․whether on non-social housing, such as private sector housing, or across the board, I do not know, but it is our duty to anticipate the possibility of such events. I was encouraged today by the assurances of my right hon. Friend the Secretary of State that together with our right hon. Friend the Chancellor of the Exchequer all possible resistance would be presented to our European friends to ensure that that does not happen in the United Kingdom.

I was encouraged by the comments of my right hon. Friend the Chancellor of the Exchequer when he appeared before the Treasury Select Committee recently and admitted, with the benefit of that great gift of hindsight, that certain actions of the recent past should perhaps not have been taken. One of them was the delay between the announcement and the implementation of the abolition of double mortgage tax relief. The three-month delay in the implementation of that decision by the then Chancellor of the Exchequer undoubtedly increased house price inflation and encouraged people to borrow more than they should. If that had not occurred, the subsequent slump in the housing market, which we are witnessing now, particularly in London and the south-east and to a lesser extent elsewhere, would not have happened. It is incumbent on all hon. Members to learn from those lessons.

I am worried about the plight of the housing market and those involved in the construction industry. Companies, large and small, are being forced into liquidation. In particular, small companies are having to lay off gangs of bricklayers whom they have employed for years. Homes for tomorrow are not being built today, and I fear that that will cause an increase in house price inflation in two or three years' time. I ask Ministers to consider the matter not simply in the context of the defeat of inflation․I wholeheartedly agree with and support that policy․but in the context of young people who leave school today and look to buy their first home tomorrow. The housing market is in a state of stop-go. When the Government came to power I hoped that we would see the end of stop-go policies.

Young people and not so young people who are suffering from high interest rates on their mortgages were perhaps encouraged to borrow more than they should from the lending institutions, which include not just building societies but banks which entered the housing finance market. I hope that they will not be tempted to remortgage through some other institution, such as a foreign bank with some so-called product linked to the value of the deutschmark, the yen or the franc. I hope that they will be sensible and will return to their lending institution, lay their cards on the table and say, "We cannot afford to repay what we previously committed ourselves to." I am sure that if they do, they will receive a sympathetic hearing and that their lending institution will try to reschedule their borrowing, whether by extending the loan, freezing the interest or a combination of several levers, to ensure that their hardship is relieved.

In the Housing Act 1980 the Government introduced a tenants' charter․something which the Labour Government talked about and the Conservative Government have implemented. In particular, the charter sought to impose on local authorities a duty to compile a list of their tenants who would be prepared to sublet part of their accommodation that was surplus to requirements. The hon. Member for Dagenham told us that the majority of cases that he deals with at his advice bureau are about housing matters. I can confirm that from my constituency experience. A large proportion of those who come to my advice bureau are single and for one reason or another cannot or do not want to live with their parents. For them the answer must surely be to find short-term accommodation, perhaps lodgings in the town where they grew up and seek employment. The best way to find short-term accommodation is to search the local authority list to find the houses that are larger than the tenant's requirements.

Photo of Mr Allen McKay Mr Allen McKay , Barnsley West and Penistone

I am listening with great interest to the hon. Gentleman and two points arise on subletting. First, the young single people who come to my surgery want a place of their own. Unfortunately, there is a shortage of suitable accommodation. Secondly, does not subletting interfere with a person's housing benefit? That acts as a disincentive to subletting.

Photo of Mr John Heddle Mr John Heddle , Staffordshire Mid

All of us, from the moment we leave school, want accommodation of our own, but we cannot always have what we want when we want it. Sometimes it is necessary to take what may be second best, but possibly better than the homelessness to which hon. Gentlemen have referred. The hon. Gentleman also mentioned housing benefit. Surely, for a widow or widower in a three-bedroomed house, to sublet a room that is no longer used except for the storage of trunks and other memorabilia will produce an income supplement which could be substantially in excess of what they might lose in housing benefit.

I wholly reject the motion in the name of the Leader of the Opposition and wholly support the amendment tabled by my right hon. Friend the Prime Minister.

Photo of Mr Ronnie Fearn Mr Ronnie Fearn , Southport 4:57 pm, 13th December 1989

Tory Members have tried hard to put a brave face on the housing problem that the country faces. They have found excuses and ingenious ways of, shall we say, putting the problem into context.

I agree with many points made by the hon. Member for Mid-Staffordshire (Mr. Heddle), but people's everyday experience is so different. People know that things are wrong as they cancel their Christmas. They know that housing policy has failed as they see the pictures of cardboard city. After 10 years of Tory government they see housing policy in a shambles. They have begun to wonder whether the Government have any answers to the housing crisis.

Perhaps the most prominent issue is the rise in mortgage rates and repayments, which has been dubbed the Tory tax. The cost of Conservative mismanagement of the economy has been huge: the rise in interest rates from 9·8 per cent. in July 1988 to the present 14·5 per cent.; the increase in the monthly repayments on the average £30,000 mortgage of £75; and the increase in the monthly repayments on the average £60,000 endowment mortgage of more than £200. Those rises dwarf the tax cuts of previous years.

The Government used to talk about creating a stable financial climate—an environment where businesses and individuals could plan their investments. We presumed that they realised that people do not always plan ahead. We thought that they realised that people cannot always see what is round the corner. When people do not see what is coming, that does not make them imprudent. I invite the House to look at the most sophisticated economic forecasters, whose job it is to guess what interest rates will be in a year's time. In July 1988, when the mortgage rate was 9·8 per cent., none of them predicted rates of 14·8 per cent. at Christmas 1989, and they are the specialists. This Government do not apologise for their mistakes; they simply shrug their shoulders as if to say, "You should not have borrowed so much." So much for providing a stable financial climate.

The home owners have been hit and they are bearing the brunt of the Government's interest rate policy. They are being punished for this Government's mistakes. The price for house owners is only too real. The number in arrears is beginning to grow. In December 1988, a total of 326,000 individuals were more than two months in arrears.

Photo of Mr Allan Roberts Mr Allan Roberts , Bootle

The hon. Gentleman and I represent opposite ends of the same local authority area. Is he aware that there has been a fourfold increase in homelessness in the Sefton local authority area, mainly caused by people having to default on mortgage payments? That is putting pressure on the supply of homes in Southport, where Sefton council houses the homeless. Itis also creating tremendous problems at the other end of the borough, in my constituency, where housing problems and homelessness are increasing dramatically.

Photo of Mr Ronnie Fearn Mr Ronnie Fearn , Southport

The hon. Gentleman is right. We thought Southport was the affluent end of the borough, and that Bootle would be the area to suffer most from homelessness. However, it is the reverse. Indeed, the whole of the Sefton borough has homeless people, including Crosby, Formby and the rural areas.

In December 1988, a total of 326,000 individuals were more than two months in arrears with their mortgage payments. By July this year, the number had shot up to 400,000, and that was before the recent rise in mortgage rates, before the poll tax demands arrive and before the rise in unemployment that the Chancellor mentioned yesterday. Independent housing experts expect the number in arrears to rise to more than 450,000 towards the middle of next year. That is almost half a million households, many of them families, that have to cut back drastically. That is half a million people living with the fear that they might lose their homes.

People say that building societies are being understanding and lenient and that few people are threatened with losing their homes. I am pleased to say that, in many instances, that is true and people are being allowed to extend their mortgages, capitalise their debts and take "repayment respite". Such flexibility is welcome, but it is not the whole story. Many of the new lenders are not friendly building societies. Even the high street banks—where I used to work—are not generally thought to be as understanding as the building societies and some of the new financial institutions can be described only as loan sharks. One firm advertised its mortgages: Good news! Up to 35 per cent. saving on interest payments. Such a firm will hardly have the decency to think twice about putting pressure on those in arrears, scaring them and then repossessing.

There is a lack of advice and information. Many lenders either do not give advice or are too busy to give the personal advice that is really needed. The voluntary and local authority finance groups that offer debt counselling are overworked and underfunded. Comments from a debt counsellor, as reported in a recent newspaper article, say it all: Assistance can only now be given in dire emergencies…If we take on any more people we won't be able to fulfil our role as an advisory service properly. As the number in arrears mounts, the pressure to repossess increases. It is already clear that the number of repossessions in the south is rising, and that it is likely to become an explosion in the new year. First, many people will not feel the pressure from the recent rise in rates until the new year. Secondly, next year there will be a rise in unemployment—that is forecast. Thirdly, there will be an increase in the number of bad loans sold to professional debt collectors. It puts the fear of God into many people when they realise that debt collectors have hold of their mortgages.

Many people fear that the housing market may pick up just sufficiently to persuade lenders that it may be worthwhile to repossess. Any leniency by lenders until now may have sprung simply from self-interest. It costs to repossess, and the lender may not be able to sell the house, even at a knock-down price. A slight upturn in the housing market might be good news for estate agents, but for the indebted—those really suffering under present policies who can sell their houses only at prices lower than they paid—it might mean the bailiffs.

Hon. Members who do not know what repossession means should read last week's The Sunday Correspondent, which gave a description of one family's experience. A brief extract gives the flavour. It said: It took 45 seconds for the man to go from homeowner to homeless. He owed £5,455·31 in mortgage arrears: 'This order means the building society can take possession in 28 days. Have you anything to say?' said the registrar…'I lost my job, but I got a new one, but I'm waiting for the first month's wages and then I'll start to…'But the man did not stand a chance.'Can you pay £500 every month on top of the usual payments?…No? Well they'll have to repossess. Next. Some hon. Members might be pleased that our judicial system is so efficient that it can deal with an N29 order for repossession in 45 seconds. They might care to reflect on the shame people feel, on their despair and on their futures. We are not unrealistic on these Benches. We do not think that there is a policy that can correct the failure of this Government's economic mismanagement without pain. The problem with the Government's policy is that it does not give anyone hope. People envisage higher mortgage costs carrying on into the distant future. They realise that the Government are divided about what to do.

People should be aware that there are alternatives that would bring hope to home owners, and the House should be aware that there are alternatives that would restore credibility to economic policy. Early membership of the exchange rate mechanism would allow interest rates to fall relatively quickly. If demand began to get out of control, sensible tax reforms would tighten fiscal policy, preventing the need always to resort to high interest rates. The policy would still be painful in the short term, but there would be hope. People would know that the policy was credible and that it would help to bring down interest rates.

While economic policy is put right, the Government could alleviate the problems of the home owner in arrears, whose house is about to be repossessed, through other measures. For example, assistance in debt counselling would not cost a great deal. As the Government's economic mismanagement has caused the crisis, the least that they can do is to help in the provision of advice.

The Government could also tighten control on the misleading advertising of credit. For example, they could extend the Financial Services Act 1986 so that organisations such as FIMBRA could control the actions of its members advertising mortgages in a misleading manner. In that way, investor protection could be extended from the investor in insurance to the investor in property. Surely it is the Government's job to promote consumer protection, especially in an area as important as the housing market.

The home owners of Britain are not asking for much. Indeed, many of them probably realise that there are many others with far more serious housing difficulties. I do not have time to go into the detail of the many other housing problems facing people in Britain. That is not because the problems are not acute. Other hon. Members have referred to the depth of failure of the Government's housing policy, the consequent rise in homelessness and the poor state of the housing stock.

The warning that I am giving the Government is that the home owner in arrears today could be the homeless person of tomorrow. They must not make the housing problems of everyone else worse by ignoring the plight of the home owner. The crisis is not only at Christmas; it is with us for many years to come.

Photo of George Young George Young , Ealing Acton 5:09 pm, 13th December 1989

Like the hon. Member for Southport (Mr. Fearn), I read the moving article in The Sunday Correspondent last week. In my brief remarks I want to take up the theme of homelessness on which the hon. Gentleman and other hon. Members have touched.

Last week, a number of Members on both sides of the House and in both Houses who feel strongly about homelessness formed the all-party parliamentary group on homelessness. We look forward to working with the many organisations whose work in that area we applaud and who have some exciting and fresh ideas to help tackle the problems of homelessness. We also look forward to talking to Ministers and obtaining further details of the £250 million package, an announcement which I greatly welcome.

As joint chairman of that newly formed group, I am interested in solutions and practical help for the people who find themselves homeless, rather than in propaganda. Any strategy for dealing with homelessness must start by sending a clear signal to young people who now have somewhere to live but who are thinking of coming to London, or another city, in search of their fortune but who have no clear idea of where they would stay. I hate to cross swords with my right hon. Friend the Member for Chingford (Mr. Tebbit) but the message for them must be, "Don't get on your bike. Don't come to London in search of work unless you have somewhere to live, because if you find a job you will not be able to hold it down unless you have somewhere permanent to stay."

I welcome all the initiatives that are being taken, but we must not weaken the strong signal to young people that the situation in the capital is desperate and that they should not chance their arm and come here on the offchance of finding somewhere because the chances are that they will not.

I want to make two points on the theme of homelessness. The first concerns the tenants incentive scheme. Part of the solution for homelessness in London must be to look at those who are now living in London who neither have to nor want to do so, but who cannot afford to move out—people who may have retired or have children living in other parts of the country and who are local authority tenants. The tenants incentive scheme gives them the opportunity to own their own homes, to move out of the capital and to be near their families.

The advantages of the tenants incentive scheme is that it is quick; it provides relets without having to build fresh accommodation which can take two years. Not only is it quick, but it is a cost-effective way of getting relets without spending the £80,000 or £100,000 that it would cost to build a new flat. If one gave a dramatic and enthusiastic push to the tenants incentive scheme in London, every family now in bed and breakfast could be out within 12 months. Therefore, I ask Ministers to look again at that scheme to see whether its full potential is being achieved and whether one could put fresh steam behind it to free accommodation and get families out of bed and breakfast accommodation.

My second point relates to planning, but it impinges directly on the problems of homelessness. There is a shortage of houses in the south-east and that is why we have a problem of homelessness. Even if we do all that we can to encourage local authorities to let property that is empty, to encourage the private rented sector to bring back into use property that is unlet and make full use of derelict land, there will still be a shortage of homes in the south-east for those who are already living here. It is nonsense to say that we should let the market work and let prices in the south-east rise so that people find accommodation in the north-east or elsewhere. That is not a practical solution. It means that nurses, teachers, postmen or bus drivers could not afford to live in the south-east, and that would lead to unbalanced communities. Part of any strategy for dealing with the housing shortage and homelessness is to increase the supply of homes in the south-east.

I welcome the solution of new villages or new settlements which provide the opportunity to build new balanced communities with accommodation for rent and for sale, but I am slightly disappointed at the lack of progress that has been made by new settlements or new villages in the past few months. There have been some disappointing decisions on appeal and I hope that next year the Government will look again at the new settlement approach to the housing shortage in the south-east to see whether that should form part of the solution.

The Government need not be ashamed of their housing record. If the Labour party had achieved what the Government have achieved over the past 10 years, bearing in mind the disappointing last three years of the Labour Government, it would be well satisfied.

The hon. Member for Dagenham (Mr. Gould) rightly referred to the number of people with housing problems who present themselves at Members' advice bureaux, particularly those of London Members. But a variety of solutions are now available that simply were not on offer 10 years ago—solutions such as shared ownership; low-cost home ownership; the revival of the private rented sector, which was dying on its feet 10 years ago; the priority estates project, bringing back into use council estates that were impossible to let; the housing association movement borrowing fresh funds from the City, adding to the resources made available to it by the Government. The picture painted by the hon. Member for Dagenham was incomplete. I commend the Government on their ingenuity, initiative and determination in improving the housing conditions of people in Britain.

Photo of Kate Hoey Kate Hoey , Vauxhall 5:15 pm, 13th December 1989

I am pleased that this debate is taking place today. As a new Member, I may not yet understand the nuances of the House, but it is rather disturbing that the Benches of the House were filled for yesterday's emotional and important debate and yet they are relatively empty today when we are discussing a matter of major importance to the British people. Perhaps we all share some blame for the fact that housing has not become a crusade in Britain.

I want to talk a little about the impact of high mortgage rates on London in particular. If anything good can come out of high mortgage rate, it is that it has at least brought the shortage of housing and the importance of that to the attention of many of thousands of people who until now may not have seen that as a problem.

Londoners are particularly affected by the increase in mortgage rates, because London has the highest house prices in the country. The average home in the capital costs just below £100,000, while the national average is a little above £60,000. Average incomes in London are above the national average, but they do not exceed them to that extent. The size of London's economy and its continuing buoyancy compared with other areas mean that demand for housing remains high and prices are determined by what a small section of the population can afford, leaving the rest to struggle with high bills.

Therefore, it is not surprising that, although some 600 home owners in London have become homeless during the past year, the increase has not been so great in the rest of the country. Until now, the relatively low rate in London has been due to the booming housing market. Many people who have got into trouble with repayments could still sell at a profit and buy elsewhere. With the collapse of the housing market many people will not now be able to do that. Therefore, we are seeing only the tip of the iceberg in terms of homelessness which has resulted from people not being able to afford their mortgages.

It is worth pointing out what a daunting task now faces the first-time buyer in London trying to get on the first rung of the housing ladder. The average mortgage advance for first-time buyers in London is now £70,000. With present interest rates, that means repayments of approximately £850 a month. The Government have told us that high interest rates will continue until such time as they can be cut. Therefore, we may be facing high increases in mortgage rates, and that will mean that more people in London face having to get rid of their homes. As we heard in the moving account in The Sunday Correspondent, they will be forced to go through the stigmatising process of having to sell their home or having it taken from them.

I share the sentiments expressed earlier about the availability of tax relief for people who wish to buy homes together. The change in August 1988 cut off a further avenue for young people and is to be regretted. There are alternatives to buying in London, but renting from private landlords is expensive, the accommodation is hard to find, and the security is poor. Due to the complete collapse of local authority new home building and the sale of over 120,000 London council homes since 1979, councils now have far fewer lettings. We have already heard that housing associations are currently starting fewer homes in London than in the 1970s, so councils and local housing associations are overwhelmed with meeting the needs of the homeless.

Despite an average of over 60 per cent. of council lettings going to the homeless in London—over half as many again as in the rest of the country—there are now 25,000 homeless households in temporary accommodation in London. That would be the equivalent of a sizeable town such as Stevenage.

Some hon. Members may have seen in a newspaper this week an article on a person in my constituency who was homeless and begging. Attempts were made to prove that he had money and to show that he was not genuinely homeless. The attack was particularly sad. If those reporters had walked through the Bull Ring and spoken to people—although I doubt if many from the newspaper involved would dare to—they would have discovered the type of people who are homeless. It is important to point out that one cannot classify "homeless people" as just one category. Every homeless person is an individual with particular needs, problems and reasons for becoming homeless.

The "Skipper" is one of the projects from the north Lambeth day centre which is involved with homeless people. The centre is an education project where many young people can go to obtain advice and to practise, learn and improve their writing skills to help them obtain a job. An average young person who visited the north Lambeth day centre said: From June 1989 to September 1989 I had no money because I'd lost my YTS place and my bridging loan had run out. I went to the DSS in September because I had nowhere to live and was under 18, they wouldn't give me any money. I felt like they didn't want to know and didn't care. I tried to get work and told them this but they made me feel as if I was lying. Eventually I went to the Council who found me a room in a hostel. I had somewhere to live so I went to the DSS expecting money. I was given a £6 crisis loan which was to last two weeks. I was only given this because I was in 'Severe Hardship' and would eventually get Income Support because of this. This meant I had to live for 14 days on £6. I went again three days later and was told I wasn't entitled to anything else. Luckily the hostel lent me £4 for food and a social services worker obtained £20 from the Salvation Army for me. In this edition of "Skipper" there are other letters from homeless people who are lucky enough to have the benefit of the people working at the centre. That example shows how false it is for anyone to try to say that all the homeless —or a substantial number—are simply people who have left home and could return.

If I look around my constituency I see people who are living in inadequate housing, perhaps on the seventh floor of a tower block, in great overcrowding and in conditions with an enormous amount of damp or where the flat is obviously in disrepair. Are we saying to those people that they are adequately housed and that they have a home and there is no problem?

The definition of "homelessness" should be widened to include people who do not live in decent surroundings or an environment likely to improve their well-being and health. Such places cannot be called a home. In some ways, our narrow definition of homelessness excludes the many thousands of people who are living in appalling conditions and who have little chance—in my constituency—of being rehoused' One in 10 households in my borough suffers from extreme overcrowding. They have no chance of finding anywhere decent to live. There is no point saying to them, as the Government would, "Why don't you try to buy?" First, they would not want to buy the flat in which they are living because it usually needs an enormous amount of work and money spent on it. Secondly, they would have no chance of obtaining a mortgage.

There are many myths about homelessness and housing, and one of the saddest things is that it has not become a crusading issue. All hon. Members rightly feel passionately about the National Health Service, but unless one is suffering directly from a housing problem, it does not reach the top of the agenda. However, at Christmas it does and over the next couple of weeks we will probably see many sad articles in the press about homelessness. But as the hon. Member for Southport (Mr. Fearn) rightly pointed out, after Christmas the problem will still exist.

I hope that this Opposition day debate will mark the beginning of an increase in awareness—not just in the House but in the country—of the state of housing and how dire it is. There must be choice of housing but, under Government policies, only a tiny percentage of the population have real choice. I hope that today we will show that everyone has a responsibility. People in the country who are well housed and have no problems have a responsibility to raise the issue of homelessness with their Members of Parliament. They should bring it to the forefront, so that, by the end of next year, we will be able to say that something has been done about housing. In London, the position is already dire as we cannot get nurses, teachers, or people to staff buses or transport. The basic reason for that is that people can no longer obtain housing in London or live in a safe environment where they are happy and contented.

We must see the problem of homelessness as crucial, and we must develop housing throughout the country but particularly in London. We must see it as a major problem that will engulf us in a year or two if something is not done quickly.

Photo of Mr Douglas French Mr Douglas French , Gloucester 5:28 pm, 13th December 1989

The motion moved by the Opposition "condemns", "deplores", "warns" and "deplores" again. However, as my right hon. and learned Friend the Minister made clear, it does not propose any sound solutions.

The hon. Member for Dagenham (Mr. Gould) called for a "fundamental reappraisal" and "reversal of mistakes", but when pressed to come up with details of Opposition policies he made a feature of not presenting any for fear that they might be scrutinised.

The hon. Member for Vauxhall (Ms. Hoey) called for more choice. In the last 10 years, the Conservative Government, to a greater extent than any previous Administration, have endeavoured to provide genuine housing choice.

Photo of Gerald Howarth Gerald Howarth , Cannock and Burntwood

Will my hon. Friend defend that statement in the light of the Government amendment to the motion, which does not even mention choice?

Photo of Mr Douglas French Mr Douglas French , Gloucester

It mentions the right-to-buy, which provides choice for people who might not otherwise have it.

It is a pity that Opposition Members have not acknowledged the extent to which the Government have sought to provide additional opportunities for people to purchase their own homes, in particular for council tenants through the right-to-buy legislation. That has brought within the grasp of many who otherwise would have been unable to contemplate it both the possibility and the reality of owning the house or flat in which they live. From time to time the Labour party has been slightly more enthusiastic about that policy, but is has never been very keen to endorse it.

Those who have exercised their right-to-buy have, in my experience, almost always been pleased to have done so. In recent years the scheme has been improved. There are better discounts and the range of properties within the ambit of the scheme has been extended. Since 1979, more than 1 million houses and flats have been sold through the right-to-buy scheme. That is an impressive figure, but it still means that the scheme has been only a qualified success. Only one fifth of the properties which might have been purchased in this way have been bought. Since it represents the bargain of a lifetime for those who decide to take up the option, it is worth asking why it is that approximately 14 local authorities have sold only about 10 per cent. of their local authority housing stock. In contrast, those who have done well have sold about 35 per cent., but even that does not represent a very impressive percentage.

It is absolutely clear that the success or failure of the right-to-buy scheme in particular areas and at particular times has no connection whatever with interest rate levels. In the last year, the number of flats purchased through the right-to-buy scheme—just under 27,000—has been the highest ever. That coincided with a period of admittedly high interest rates, but they have not deterred people from exercising their right to buy.

Even at times of high interest rates, it is both desirable and possible that people should still wish to become home owners. For some of them, the arithmetic may look daunting, but even within normal or very low household budgets it is still perfectly possible for people to exercise their right to buy. Nevertheless, the time has come when the scheme should be boosted. I therefore welcome the Government experiment known as the rents into mortgages scheme, which provides an important alternative means of purchasing one's home and additional choice for prospective purchasers.

There have been two experiments. The first was announced on 30 October by my right hon. and learned Friend the Secretary of State for Scotland and applies to houses and flats owned by Scottish Homes. The second experiment, known as flexi-ownership, was announced in September by my right hon. Friend the Secretary of State for Wales and applies to the 1,350 houses and flats owned by the Development Board for Rural Wales. In both cases, the system enables tenants to buy their homes for broadly the same weekly outlay as they currently pay in rent.

The system combines a discount entitlement with a mortgage and a deferred loan but, unlike many low-start schemes, it does not depend on an increasing burden of accumulating interest. It satisfies the deferred loan from the proceeds of the eventual sale of the property, but the cost of the deferred loan facility is calculated by reference to a proportion of the capital gain which has accrued in the intervening period. To that extent it has the characteristics of a shared ownership scheme, but there is no proper shared ownership.

It is worth examining the arithmetic of such a scheme, since it is not widely understood. In both cases, the starting point is the rent currently being paid by the tenant. To that rent, for calculation purposes, 10 per cent. is added. Then £5 in the case of a house, or £7·50 in the case of a flat, is deducted from it as a notional allowance for the insurance and maintenance costs that the new owner will have to bear. Taking the average rent in Wales, which is £21·84, if one adds 10 per cent. and deducts £5, that leaves £19·02. That is the amount which the prospective purchaser would have to pay each week under the rents into morgages scheme. The amount of low-start mortgage that £19·02 will buy is the figure that the tenant pays for his purchase. But that is not enough to cover the entire cost: the difference between that amount and the market value of the house is met, first, by the discount and, secondly, by a deferred loan.

An important feature of the scheme is that the discount is 15 per centage points less than the discount that is applied in the right-to-buy scheme. If it were otherwise, the introduction of such a scheme might be less than welcomed by those who have already exercised their right-to-buy under the existing scheme. Discounts under the rents into mortgages scheme start at 17 per cent. for houses and 29 per cent. for flats. They rise to 45 per cent. for houses and 55 per cent. for flats, which is 15 per cent. lower than the maximum that is available under the right-to-buy scheme.

The important distinction, apart from the discount differential, is that even after the purchase has been made, eligibility for discount continues to accrue at 1 per cent. per year in respect of the calculation of the deferred loan that later has to be repaid, subject to the maximum percentages. When the time comes to sell the property, the deferred loan is the amount represented by the original percentage, as applied to the sale price, less the additional discount which has accrued at 1 per cent. per year.

By means of that ingenious formula, the loan is repaid, the mortgage is repaid and the purchaser—who now becomes the seller—is left with a significant capital gain, the amount of which will depend on house price inflation in the intervening period. It is not a dream or a nightmare, as the hon. Member for Dagenham suggests; it is a painless way of achieving home ownership.

My hon. Friend the Under-Secretary of State for the Environment wrote to me on 2 November 1989. In his letter he said that the Government had no plans at present to extend the rents into mortgages scheme beyond the two experiments in Wales and Scotland. He confirmed that they are trial experiments for three years and that they will be monitored and evaluated. However, in the 30 days from 30 October to 30 November, at a time of high interest rates, the number of inquiries in Scotland about the scheme amounted to 360. That is a sign that it will be enormously successful—and so it should be because it is extremely attractive. It would be even more successful if it were heavily promoted. Once the early part of the experiment is concluded, I see no reason why it should be necessary to wait three years before the scheme is promoted nationally. It should be promoted for the excellent scheme that it is, and should apply to all local authority tenants in all parts of the country—or, if that is not possible, particularly where there are housing pressures. I should like it to apply in my own constituency of Gloucester. It is an ingenious and a winning formula and I very much hope that the Government will decide to extend it nationally.

Photo of David Winnick David Winnick , Walsall North 5:40 pm, 13th December 1989

As my hon. Friend the Member for Knowsley, North (Mr. Howarth) pointed out, it is not surprising that the Government amendment makes no mention of rented accommodation. Basically, it is a problem or a crisis in which the Government take no interest. It is also not surprising that the Government amendment does not boast about the provision of private sector rented accommodation. Had the Housing Act worked in the way in which the Government predicted, they would now be telling us about all the private sector rented accommodation that had been provided through shorthold and shorthold assured tenancies.

In the past few days, I have tried to find out what the position is. I have tabled questions to the Department of the Environment and I have been to the Library where they were good enough to ring up a number of organisations concerned with housing, but hardly any information is available. The general consensus among organisations concerned with housing is that the number of new dwellings available in the private sector as a result of the Housing Act 1988 has been derisory, as Labour Members constantly warned when the legislation was going through the House. The new accommodation that has been provided here and there has been mainly in the high rented sector, and of course that is of no use to the vast majority of our constituents.

I listened carefully to the hon. Member for Gloucester (Mr. French). When people go to his surgery, as they come to mine, and tell him about their acute housing plight I wonder whether he gives them the lecture that he has just given the House.

At present, this country has the largest number of homeless people since the end of the war. Tonight only five minutes from here people will make their homes in cardboard boxes as they have on previous nights, and will in future. A few nights ago, I went to see what was happening outside Embankment station. Any hon. Member who thinks that I am exaggerating should go along there. It is a disgrace that so many people should be living in those conditions in an advanced industrialised country, whatever our economic problems. Many of them do not have drink or drugs problems. Many are perfectly law-abiding citizens who have come to London and simply cannot find accommodation. The Evening Standard provides information about rented accommodation at £150, £200 and £250 per week. What use is that to people coming to London who may find a job paying a modest wage? They will not be able to afford to buy, and nor will they be able to afford rented accommodation. The lectures from the hon. Member for Gloucester are no help to the people who will sleep outside Embankment station tonight. Perhaps the hon. Gentleman would like to go there tonight after the 10 pm vote and lecture those people about the schemes he has mentioned. I am willing to accompany him.

The crisis is not just among the homeless. My hon. Friend the Member for Dagenham (Mr. Gould) said that most people who come to see him have housing problems. Surely that is true for most of us. At least 65 or 70 per cent. of those who come to my regular constituency surgeries or write to me are concerned about housing problems. Because of deliberate Government policy, and not because of the failure by the local authority, my own council has been able to undertake no housebuilding at all in the past 10 years. Of course, as the Government constantly boast, the public rented sector has been substantially reduced. But what should I say to a couple with two children who could wait for years in a small flat? One can imagine what it is like for a mother with two small children in a small flat in a multi-storey block who goes almost daily to the local housing office trying to find a house. People with no children have hardly any chance of finding accommodation; if they have one child they wait a long time to be rehoused from a flat to a house and more recently even families with two children can wait literally for years. All they want is a house. They cannot afford to buy and they certainly cannot afford any of the schemes mentioned by the hon. Member for Gloucester. What is their crime? Why should they be penalised day in and day out because their income is low?

I accept entirely that the majority of people in Britain want to own their own homes. I do not deplore that; I own my own home, or at least I am buying it through a building society. If it is good enough for us, of course other people should have the same opportunity. I do not deplore the fact that the majority of people want to own their own homes. If Tory Members really believe their propaganda that Labour Members are against owner-occupation, so be it. But we have never been against owner-occupation and in many ways we have tried to encourage it through various schemes when we have been in office. But what happens to the people who simply cannot buy? That is the divide between the two sides of the House. We are not divided about whether owner-occupation is good. We accept that and we believe that it should be encouraged. We know, however, only too well the mortgage difficulties faced by so many people who have bought their own homes in the past couple of years as a result of Government policy. We are not divided over the wish that people should buy their own homes if they can. But there is certainly a very big divide about what we should do about more than a quarter of the people in this country —those who need rented accommodation.

The case against the Government is that through sheer dogma and political calculation, which also comes into the picture, they will not allow local authorities to undertake the work that local councils have been doing for most of the century. Even under previous Tory Governments, council dwellings were built in virtually all parts of the country. Now it is virtually impossible. If it is Government policy that local authority dwellings should not be built, they should provide alternatives. But, as I said, the private rented sector does not provide the accommodation which is so necessary, despite the promises made by Ministers when the Housing Act was going through. What should we do when people who could not possibly afford market rents come to see us? Housing benefit, which has been cut so drastically, does not help. Ministers know that. No matter what fine words they may say at the Dispatch Box, Ministers are callously indifferent to the plight of people who are punished and penalised because they are not in a position to buy.

Council rents are also a form of punishment for tenants. In the past 10 years, council rents nationally have been forced up by 234 per cent. compared with an inflation figure of 110 per cent. over the same period. So in effect the Government have told council tenants that if they wish to continue as tenants they will he penalised. There is certainly no justification for the exorbitant rent increases that have been imposed in the past few years.

It is not surprising that the number of people with rent arrears is increasing. For example, the total income of one widower in my constituency who came to see me is £54 a week. Imagine what it must be like to live on that amount. He pays more than £10 a week in rent. I know that rents have increased and housing benefit has been dramatically reduced, but I could not believe that that man should be paying more than £10 a week in rent out of an income of £54 a week. I checked the amount with my local authority, which is not to blame for it. How could it be to blame? The Government's policy has been to force up council rents while drastically reducing housing benefit.

This country needs a substantial council house building programme. Only local authorities, together with genuine housing associations, can provide the rented accommodation which is so desperately needed. My hon. Friend the Member for Vauxhall (Ms. Hoey) said that there were not many Members in the Chamber, unlike last night. The difference is that last night we were not sure which way the vote would go. As with debates on the death penalty and similar issues, one was not even certain what one's own colleagues would say. Ironically, then, though most constituents write to us about housing problems, there are few Members in the Chamber, whether Tory or Labour. The explanation is quite simple: we know that the Government will not listen. Because of dogma and political calculation, they are not interested in the plight of the people to whom my hon. Friends and I have referred.

When historians look back at these times they will find it difficult to believe that there could be so many people without accommodation, so many people sleeping in the open and countless families in flats who cannot get a house, and a Government and their supporters who are indifferent—there will be no abstentions in the vote tonight—to the plight of the many people who want accommodation but cannot afford to buy a house.

Photo of Edward Leigh Edward Leigh , Gainsborough and Horncastle 5:52 pm, 13th December 1989

The hon. Member for Walsall, North (Mr. Winnick) accuses the Government of callousness. The Government will spend £250 million in the next two years on tackling the problem of homelessness in London and the south-east. I do not call that the action of a callous Government. They will spend £20 billion over the next three years in grants and expenditure on housing. I do not call that the action of a callous Government. We do not improve the debate by making such simplistic party political attacks.

To have a serious debate on these issues, we must at least compare alternative strategies. Much of the debate has been artificial. The Government have put forward their view which some may think is wrong headed. The hon. Member for Dagenham (Mr. Gould) was not prepared to say what the Government-in-waiting—as presumably he considers the Labour party to be—would do about the problem.

Photo of Edward Leigh Edward Leigh , Gainsborough and Horncastle

I deny that, and Hansard will prove that he did not. I invite the hon. Member for Hammersmith (Mr. Soley) to explain what the Labour party would do in the current circumstances. I suspect that he will not.

Two years ago, there was a potential world recession and a stock market crash and it was necessary to have reflation through supply side measures, which inevitably resulted in inflation. The only way to curb inflation is to encourage saving and curb borrowing, which can be done only by increasing interest rates. A Labour Government would have done that, just as this Government have.

Photo of Edward Leigh Edward Leigh , Gainsborough and Horncastle

I shall not give way. I shall speak briefly so that other hon. Members can participate.

Bringing up a young family and having to pay for property with a mortgage, I suffer as much as anyone from high interest rates. Like all people in my age group who are bringing up young families, I urge the Government to bring down interest rates as soon as possible, but not so soon that it would limit the battle against inflation. Some of us suffer from high interest rates, but everyone suffers from inflation.

We should put the matter into context. Average incomes have increased by £67 a year over the past two years, while the average amount paid on an average mortgage of £22,000 has increased by £58 a year, despite the increase in interest rates. The Building Societies Association has proved that there is little evidential link between high interest rates and the number of repossessions. In the latter part of 1988, the number of repossessions fell to 0·01 per cent. of home loans. Repossessions have more to do with personal financial mismanagement, matrimonial problems or unemployment than with high interest rates. High interest rates are necessary if we are to curb inflation and get the economy running along the right lines.

We must address the problem of housing for young people. I do not believe that the solution advocated by the hon. Member for Walsall, North was right. We must consider the kind of shared purchase schemes which were advocated by my hon. Friend the Member for Gloucester (Mr. French). I represent a rural area which traditionally has had low house prices. Young people in the villages in my constituency are finding it increasingly difficult to buy cottages and houses. Such housing is no longer within their price range because of the movement to the area of retired people from the south of England. I do not believe that the solution to the problem is to build more council housing in villages and trap people in rural areas subsidised housing from which they will find it difficult to escape in future years. The solution is to develop shared purchase schemes which will capture the imagination of young people. We may have to require local authorities to enter into such schemes.

Photo of Mr Martin Brandon-Bravo Mr Martin Brandon-Bravo , Nottingham South

I appreciate the fact that my hon. Friend, like all of us, is worried about high interest rates. He touched on the prices of houses. Are not higher house prices the down side of lower interest rates? Sometimes a person may be in a Catch-22 situation—as interest rates come down, he still finds it difficult to get on to the housing ladder because house prices have increased as a result of low interest rates. That was the position in 1987.

Photo of Edward Leigh Edward Leigh , Gainsborough and Horncastle

My hon. Friend makes his point. Our economic policies are right and necessary. Much of what must be done in Government is as painful as it is inevitable, but it must be done.

In our next legislative programme, we must look much more closely at shared purchase schemes and the private rented sector. We have been successful with assured tenancies and shorthold tenancies. Although I am sure that we will not get the Opposition's agreement, we must look at freeing the private rented sector for all future tenancies. The only way to address the problem of homelessness and to help young people, especially in inner-city areas, is to free the enormous supply of private rented accommodation. Such accommodation exists in under-occupied buildings, yet people do not have the confidence, ability or determination to put rooms in their houses on the market and may not be encouraged to do so. With shared purchase schemes, we can start to address the problem of homelessness among the young people in our great cities.

Photo of Mr John Fraser Mr John Fraser , Norwood 5:58 pm, 13th December 1989

I cannot express how much I agree with my hon. Friend the Member for Walsall, North (Mr. Winnick) about the necessity to provide more homes for rent through building by local authorities and—I think that my hon. Friend would agree —housing associations. I listened carefully to the hon. Members for Gloucester (Mr. French) and for Gainsborough and Horncastle (Mr. Leigh). It does not seem to occur to Conservative Members that the great transition which has occurred as many tenants have moved to owner-occupation, because of the opportunity to buy on favourable terms and at discounts, was made possible only because of the efforts over the century of local authorities to build homes which were initially for rent. It is only the investment that took place year after year which has now made possible the transition from tenancy to owner-occupation, which most of us welcome. We should welcome it in the inner cities if only houses were replaced or there was an alternative, such as a transferable discount scheme. There is no contradiction between large-scale building for renting and owner-occupation on favourable terms at a later stage. The two are not incompatible.

I represent Lambeth, an inner-city area, which has considerable problems. It is fair to say that, when I was first elected, the single outstanding domestic problem— because unemployment was virtually unknown and unmeasurable in Lambeth then—was housing. Sadly, that problem has not gone away, although it has been joined by the problems of major unemployment and inner-city deprivation. It is to my deep regret and to the deep shame of the present Government that the housing problem, which was showing signs of improvement in terms of tenure, space standards and repairs, has been getting worse, not as a result of some act of fate, but as a direct consequence of Government policy.

What has happened in the past few years, and especially in the past year, has been critical for the more recent home buyers, who must now despair about where the money will come from after each interest rate rise. The position is also critical for thousands of people for whom the idea of buying a home is either an unattainable dream or a sick joke. The present cost of buying property will rule them out of the market in places such as Lambeth.

I shall give an illustration of my local prices. This morning, I went through every housing advertisement in the local paper, which is a south London newspaper covering Wandsworth and Lambeth. I tried to find out what was the cheapest property available for purchase in the area. The cheapest price for a one-bedroom conversion was £54,500, which was not the typical price. The usual price for one-bedroomed accommodation in the area, which is not the most salubrious part of London, is £60,000 to £65,000.

Let us consider the cheapest cost, of about £55,000. If one obtains a mortgage at 13·5 per cent., which is under the Government's present base rate, and excludes all policy costs, service charges and ground rent, the interest repayments alone for the cheapest south London house in the newspaper today would be £534 a month, or £6,408 a year. In addition, of course, there would be the costs of fares to work, of the repayment of capital and of insurance.

Nobody who is earning less than about £18,000 a year net would be able to afford, with any prudence, such a mortgage. Who would enter into a commitment in which the outgoings on the mortgage would be more than one third of net income? I know that some people exceed one third of net income, but it is not prudent when one thinks of the other commitments and other expenditure that are associated with a house, such as repairs and insurance.

I represent a constituency where the wages for the middle income group are relatively low. People may be doing useful jobs in London, but they are not highly paid jobs and, for most people, the purchase of the cheapest possible one-bedroom flat, which would not be suitable for somebody who had children, is simply out of the question. For a family with children, the price of a home would not be the minimum of £55,000, but about £75,000 or £80,000. For a first-time buyer in my area, mortgage repayments for such a property would be proportionately higher, running to perhaps £8,000, £9,000 or £10,000 a year. The idea that the people who come to see my hon. Friend the Member for Vauxhall (Ms. Hoey) or me at our advice bureaux will be able to buy a home on the figures that I have quoted is unrealistic, especially as another mortgage rate rise is still in the pipeline.

What is the next choice for people which is urged on us? It is to go into the private rented sector. I looked in the South London Press, which has a good list of properties available to let under the new regime, to see whether renting might be possible. In Streatham, there was accommodation that would be suitable for a family with children: 3-bedroom flat…can suit ¾ people. £140 p. w. That is a rental of £7,000 a year. Yet I am talking about people who will go home with a net disposable income in some cases of only about £8,000 to £10,000 a year.

I think of a nursery nurse, who works with a member of my family, and who comes regularly to my advice bureau. She has a child to look after and, although she has worked all her life, her income is only about £800 a month net, which is about £10,000 a year. She dearly wants to move out of the one-bedroom flat in which she has to share a bedroom with her child into a two-bedroom property, which would give a bit more privacy. In Lambeth, she would have to pay £7,000 a year in rent according to the example that I have given.

To show that that is not an exaggerated figure, I can give plenty of others. For a one-bedroom flat—which would be no good for my constituent because she has a child—in Mitcham, which is some way out of the centre, the cost would be £4,500 a year. If she wanted to rent a two-bedroom flat in Brockley, which is not all that posh, she would have to pay £6,000 a year, and on top of that there would be rates, repairs and service charges. I could go through the figures of the premises that are available to rent in south London. The typical figure for a room is between £45 and £60 a week. Another advertisement says: SE15, Double & Single Rooms…From £40 p. w. There is no choice for someone with the typical net income of people doing public service work—even relatively highly paid public service work—in constituencies such as mine.

The third theoretical choice—and this is slightly to bend the meaning of the word "choice"—for someone in housing need who wants better or larger accommodation is to go to the local authority or to a housing association, bearing in mind that most housing association vacancies are nominated by the local authority. However, the depth of the cuts over the past 10 years in the housing investment programmes and the extent of homelessness in London mean that virtually no families without children and virtually no families who are not in priority need of housing will be able to be housed by the local authority.

Housing investment has declined. Let us consider the forecast completions for Lambeth over the next three years. In the current year, Lambeth expects to complete 165 homes. It expects to complete 120 homes in the following year and 87 homes in 1991–92. That is the consequence of the catastrophic investment programme which has been imposed by the present Government.

High mortgage costs, high house prices, high rents and the almost total inability to obtain a house by normal means through the local authority mean that in Lambeth we face a devastating problem of homelessness. In 1987, just after the general election, there were 430 families in bed-and-breakfast accommodation in Lambeth borough. On 10 December this year there were 1,177 families in bed-and-breakfast accommodation—almost three times as many as there were two years ago—and that is in spite of all the efforts that have been made to solve the problem of homelessness by other means.

In addition to the trebling of the number of homeless families in bed-and-breakfast accommodation, the number of private sector leasing arrangements—one way in which Lambeth borough council has responded—has increased to 493. We now have more people housed under private sector leasing arrangements than we had homeless people three years ago. We have 137 people in reception centres, 89 people in short-life accommodation and five people in furnished voids, giving a total figure of 1,918 homeless families. I am told that the cost to public funds of keeping one mother and child in bed-and-breakfast accommodation in London is now £10,000 a year. It is easy to calculate the enormous costs incurred in boroughs such as mine.

It is not getting any easier. As the pressure of interest rates builds, and as rents in the public and private sectors continue to rise, the problem worsens. Between 70 and 80 families a week present themselves as homeless, and 600 cases are being considered at the moment.

Hyperbole begins to lose its meaning. I begin to despair as to how anyone is ever housed. I am deeply angry, because it is not as though the predicament in which the homeless find themselves is an accident, as though their needs are unavoidable or their deprivation inevitable. Their homelessness is the direct consequence of Government policies and Government lack of investment.

The tragedy is that the problem could be solved. People in London—especially developers—are finding it difficult to sell houses at the moment. In the docklands area, for example, many houses remain unsold when they are completed or in the course of construction. In the docklands area, land prices are higher than construction costs as a result of Government policy. It would be possible to release the massive amounts of money that are available to buy those properties for rent and eventually to facilitate the transition from renting to owner-occupation of which we have spoken tonight.

Photo of Mr Hugo Summerson Mr Hugo Summerson , Walthamstow 6:12 pm, 13th December 1989

I should like to begin with two anecdotes. The other day, I was cycling along Knightsbridge and a man at a bus stop stopped me. I thought for a moment that he was going to ask for a lift. In fact, what he asked for was money. He said that he had been robbed and did not have any money left for his train fare home. Being of a naturally soft-hearted disposition, and perhaps in this case rather foolish, I gave him some money, whereupon honesty broke out across his face and he told me, "Actually, I'm going to take it to the nearest pub and drink it."

The second story is the one that we saw in the Evening Standard the other day. It concerns a young man who makes an extremely good living standing outside a tube station with one of those notices round his neck saying, "Homeless and starving". He makes about £600 a week, tax free.

I tell those stories not to trivialise the subject—because homelessness is a very serious problem in London—but because I believe that we must regard it with extreme care. We have to sort the wheat from the chaff. The wheat can look after itself perfectly well, but the chaff obviously needs help and that is why the Government are making £250 million available to attempt to solve the problem.

Before I was elected to this place, I used to practise as a fellow of the Royal Institution of Chartered Surveyors, and as part of my job I used to look in auction catalogues to see what sort of property was coming on to the market. In all the catalogues, there were hundreds of tenanted houses and flats coming up for sale. The reason why they were being sold was that over the years the private rented market has been destroyed by legislation, largely passed by the Labour party. Bearing in mind that Labour legislation, no landlord would take the risk of letting an empty property when he knew perfectly well, first, that the rent would be controlled to the extent that he could not even maintain the property out of it and, secondly, that the sitting tenant and the tenant's successors to two or three generations might have security of tenure. I hope that the Government's policies will put that right, but I am afraid that it will take a long time.

Should the ratepayers subsidise council rents? I do not believe that they should. I believe that council tenants who cannot pay their rent should be helped, but if one asked the average ratepayer in my constituency—not exactly the richest part of London—whether he thinks that he should give a blanket subsidy to all council tenants, one would get a dusty answer.

What about the right to buy? My council, the London borough of Waltham Forest, complains, like many Labour councils, about the controls on spending capital receipts. Yet my council will not push through sales under the right-to-buy provisions. The council cannot have it both ways. If it will not push through the sales, why on earth should it complain that it is allowed to spend only 25 per cent. of its capital receipts? Moreover, it takes some time to build houses. One cannot put up a house overnight. It takes months to get planning permission and months to do the building work.

Many councils have great assets in the shape of commercial properties. My own council has a rent roll of about £1 million a year from commercial properties. But when I asked, "What exactly are these properties valued at?" I discovered that the council has not a clue what the capital values of the properties are. Surely the council could sell some of those properties and apply the proceeds elsewhere, but that is a point that many councils simply have not taken on board. Look at the GLC, which owned thousands of commercial properties and did not bother to review the rents for years and years. The London residuary body has been selling some of the properties and it has become clear that some rents have not been reviewed for 20 years. Some authorities have had no idea of how to look after their properties.

I come now to housing action trusts. It is proposed that there should be a housing action trust in my constituency. I know that some Labour Members are not in favour of housing action trusts. I hope that they will make the journey out to Walthamstow to the Boundary road estate and say to the tenants there, "We do not approve of housing action trusts. We do not like the idea that the Government might actually pay to knock down these three horrendous tower blocks and replace them with decent housing." They might also say, "We approved of the scheme of the London borough of Waltham Forest to replace those blocks which would have meant an increase of £15 a week in the rents of all council tenants in the borough."

I see that the hon. Member for Newham, North-West (Mr. Banks) is shifting anxiously in his place, so let me finish by asking exactly where all the new houses of which the Labour party speaks so grandly are to be built. London is a mature city and has been a mature city for hundreds of years, so where are the houses to be built? Are they to be built, perhaps, in Old Dagenham park? I am sure that the hon. Member for Hammersmith (Mr. Soley) would be only too keen to assure his constituents that Ravenscourt park will not be built on, and that we do not want to build in Hyde park or in the green belt.

I hope that Opposition Members would not advocate a return to the building of tower blocks, which to my mind represent one of the most horrendous forms of housing ever devised. [Interruption.] The hon. Member for Walsall, North (Mr. Winnick) is laughing. Perhaps he would like to tell his constituents that he is all in favour of building tower blocks. To my mind, they breed hopelessness and despair. I am sure that they breed unemployment and I believe that they also breed housing problems because they breed social problems. Many people leave home because they cannot bear to live there any longer.

Obviously the answer is to pull them down and replace them with the sort of housing that was there before—traditional terraced houses with gardens. That is what people want, and I believe that we should provide it.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West 6:20 pm, 13th December 1989

I thank you for calling me, Mr. Deputy Speaker, and I will see you afterwards.

The hon. Member for Walthamstow (Mr. Summerson) has a charming and disarming way of addressing the House. It is no wonder that he was voted the most romantic Member of Parliament. He told us an anecdote. As he is the Member for Walthamstow, what was he doing cycling through Knightsbridge? He did not tell us. If he spent more time cycling through Walthamstow, he would see more of the problems facing his constituents.

The hon. Member for Walthamstow even comes to the House looking like Neville Chamberlain's private secretary. Many of his views hark back to those days, and I shall touch on some of them.

Personal anecdotes are no way to solve London's massive housing crisis. The hon. Member for Walthamstow asked why local authorities could not use the commercial opportunities represented by their land holdings and assets. They cannot do that, because the Government will not let them: it is as simple as that.

The hon. Gentleman should learn something more about capital receipts and the restrictions that have been placed on their use by central Government, in particular by the Housing Act 1988. He should know that that Act prevents more than 20 per cent. of receipts from the sale of council houses being used to build in the first year. The rest has to go towards the reduction of debts. At least in the past the whole 100 per cent. trickled through. Now it does not and some £8 billion of accumulated capital receipts cannot be used.

The hon. Member for Walthamstow wanted to find out why local councils are unable to use accumulated capital receipts, and why they do not release some of their assets. He should have asked why the Government that he supports will not allow them to use those receipts to reduce housing waiting lists, by building new homes.

I do not want to hear any lessons from the hon. Member for Walthamstow, who peripatetically cycles through Knightsbridge, about the problems of tower blocks. Newham has 110 tower blocks—the largest concentration in the country. Members of Parliament for Newham represent more constituents who live above the tenth floor than is the case in any other borough, or any other three hon. Members. Even though they live above the tenth floor, their feet are firmly on the ground.

As the hon. Gentleman said, the vast majority of them do not want to live in tower blocks, but what can we do? The hon. Gentleman suggested the attractive idea of knocking them all down and building nice little town houses. We would like to do that. Perhaps the hon. Gentleman will use his good offices with his Front Bench to allow us to do that in Newham.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

I will give way to my good friend, or rather, to my acquaintance.

Photo of Mrs Teresa Gorman Mrs Teresa Gorman , Billericay

I thank my hon. Friend and acquaintance for giving way. Is he not aware that in Wandsworth ugly tower blocks have been made into desirable residences by selling them off to young people in the private sector? Now they are lovely.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

I agree that they may be desirable residences for those people who earn six-figure sums, but those flats are selling for £100,000. What good is that to homeless people living in Wandsworth? Of course that can be done. Most luxury hotels are tower blocks but conditions in them are nothing like the conditions found in tower blocks in Newham. The hon. Lady, despite her red dress, should be more practical when she expresses her views to the House.

The situation is fairly clear. The hon. Member for Gainsborough and Horncastle (Mr. Leigh), who is not in his seat at the moment, said that people get into problems with mortgage arrears because they cannot manage financially, that they mismanage, and that that may result from the family breaking up.

Someone who had an average mortgage advance in London in spring 1988, when interest rates were 9·5 per cent., paid £520 a month. Now, with interest rates at 14·5 per cent., the same home owner is paying £740, a difference of £220, or a 42 per cent. rise. That is not mismanagement by the individual householder, but mismanagement of the economy by the Government and that has caused the ludicrous rate of interest that is now being imposed on home owners and on businesses. That is why people find it difficult to meet their mortgage repayments.

It is not broken marriages that lead to difficulty in paying the mortgage, but difficulty in paying the mortgage that leads to broken marriages. I know that from the personal experiences of some of my constituents, and not, I hasten to add, from my own experience.

My hon. Friend the Member for Walsall, North (Mr. Winnick) also gave a good description of the situation that we have had to face at our surgeries. We have not made it up. The Minister tried to suggest that my hon. Friend the Member for Dagenham (Mr. Gould) had made it up. Somehow, we had created a problem that does not exist except in our vivid imaginations, but the reality is there every day in our offices, and every week in our advice surgeries. People come in and break down crying, "What are we going to do?" All we can do is offer them a tissue and a shoulder to cry on; local authorities cannot solve their problems because of the restrictions placed on house building by the Government.

How has the problem arisen? One does not need a PhD in housing administration to work out why homelessness has doubled since 1979, when that wretched party was first elected to government. It has doubled because the housing investment programme has been slashed by almost 100 per cent.—I think by about 70 to 80 per cent. in real terms.

Ten years ago, Tory and Labour local authorities in London were building 25,000 accommodation units a year. Now they are building around 2,000. That is where the housing problem comes from—the failure of the Government to allow local authorities to use their own resources to try to solve their housing problems.

I could get exceedingly angry, and I regularly do get angry, when I am confronted with problems that I cannot solve. The only way those problems can be solved is to get rid of this wretched Tory Government and get a Labour Government elected who are committed to doing something about the scandal of homelessness in Britain.

In 1989, despite 10 years of Government economic ineptitude that has reduced us to a sideline position in Europe, we are still one of the most prosperous countries in the world. Yet people are sleeping in cardboard boxes a few yards from this place, and thousands of families are living in bed-and-breakfast accommodation, with all that that means in human misery. It is a scandal that should be hung round the necks of the Government until they are booted from office. Homelessness is one of the issues that will ensure that we get rid of them.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith 6:28 pm, 13th December 1989

When a Minister gets the kind of reception at the Dispatch Box at the beginning of a debate that the Minister for Housing and Planning got today, it is normally because people feel angry or because the Minister is not dealing with the issues seriously and in depth. Today both situations apply. Hon. Members are justifiably angry, and people right across the board are angry about the growing housing crisis in Britain.

The Minister does not have a good case, and that was why there was such a vacuum in his speech, and why there is a vacuum in Government policy. That is why we do not have a proper housing Minister. The Minister spends most of his time privatisating water and his junior spends most of his time privatising the Property Services Agency. Housing is a second-rate issue for them. For the welfare of thousands of people throughout the country, however, it is vital.

The Government have gone seriously wrong. I must tell the Minister and other Conservative Members who have spoken that Labour is not alone in accusing them of having a disastrous policy; nor are housing organisations alone in accusing them of having a disastrous policy.

When the Minister criticised, or rather tried but failed to criticise, my hon. Friend the Member for Dagenham (Mr. Gould) about the state of repair of the housing stock, he ignored a report produced by the Conservative-controlled Association of District Councils, which could not have put it more clearly when it said: But neither of these estimates take into account the need for resources to tackle additional dwellings falling into disrepair in the private sector or the further deterioration, while awaiting attention, of stock already in poor condition. It is therefore clear that at the current level of public expenditure the bulk of the stock condition problem cannot be tackled within the next decade. The ADC called for an increase of a minimum of £35 billion, although the upper end of its proposed scale was £50 billion. Its view is seconded by the Conservative-controlled London Boroughs Association and most Conservative councils throughout the country.

On what is the Government's reputation built? They came up with one or two policies in 1974 which, stupidly, they have stuck to. They said of helping first-time buyers: The first part of our programme for doing this is to reduce the interest rate charged by building societies to home buyers to 9½ per cent. and ensure that it does not rise above that figure…Our second proposal is to give first-time purchasers of private houses or flats special help in paying the deposit. In 1979, they backed off a bit from saying that they would keep mortgage interest so low. They were not specific but, when it came to it, the first thing that they did, in November 1979, was to increase the mortgage interest rate from 11 to 15 per cent. On only two short occasions during the past 10 years has the mortgage interest rate been below 10 per cent. That is a measure of the Government's economic policy failure.

The hon Member for Hornsey and Wood Green (Sir H. Rossi), who was the Conservative spokesman on housing at the time, said just before the general election: as soon as we are in office we shall introduce a scheme that we announced not just today but as long ago as three and half years ago.Under that scheme, the first-time buyer will receive a tax-free bonus of £ 1 for every £2 saved. Therefore, if he saves only £300, he will receive a bonus of £150 when he buys his house".—[Official Report, 20 February 1978; Vol. 944, c. 1047.] The hon. Gentleman spelt the scheme out in more detail. Neither of those promises was kept. They were both clearly broken.

The Prime Minister said in 1980: I recognise that the Government are borrowing too much. The interesting correlation is that when the Government borrow less…interest rates go down. I shall be delighted to have the support of the right hon. Gentleman"— a reference to the then Leader of the Opposition, now Lord Callaghanand those who sit behind him to get down Government spending and borrowing, because interest rates will then go down."—[Official Report, 22 November 1979; Vol. 974, c. 554.] What went wrong with the theory? It is a disastrous failure. Interest rates are still incredibly high. The failure has been unique.

Recently, something important in housing happened. The former Secretary of State for the Environment was moved to the Department of Trade and Industry, much to the regret of that Department, and we now have a new, green Secretary of State who does not understand much about housing but knows that he has a crisis on his hands. He is much more in the mould of the previous Conservative Prime Minister, the right hon. Member for Old Bexley and Sidcup (Mr. Heath). Significantly, for the first time in 10 years, as a result of the appointment of the new Secretary of State, instead of going down, the housing investment programme is to go up next year. But what the poor new Secretary of State does not know is that he has already been kiboshed by his predecessor, who put through the Local Government and Housing Act 1989 which will mean that there will still be a cut of no less than 24 per cent. in the HIP.

I am grateful to the Minister for Housing and Planning who, although he may have misquoted me several times, did me the courtesy of quoting me almost word for word when he lifted my Labour party press release in which I spoke about rents going through the roof. One of the things that I recommended to the Conservative party, and have done for a long time, is to enable local authorities to extend the lease-back scheme in the private sector to bring into use the thousands of privately-owned empty properties. Lo and behold, the Minister has done that, using almost my very words. He has, however, done it late, and it appears that there is still no policy because only in November, under the previous Secretary of State for the Environment, the Government said that they would not extend the lease-back scheme.

Those of my hon. Friends who served with me on the Committee stage of the Local Government and Housing Bill will remember that we were told that the lease-back scheme would not be extended, although we pleaded for it. More of a crisis was brought on when the Government put out their new rent guidelines, based on the capital value of houses. That was guaranteed to send rents rocketing.

I put out a press release saying that rents in Mole Valley, which is represented by the chairman of the Conservative party, would increase by a fantastic £5·20 a week in the first year, and by 115 per cent. over a longer period. Then, in a letter dated 8 December 1989, local authorities were told that the Government seemed to have misjudged the situation and that they would like to review it before Christmas. They do not know what they are doing because they do not have a policy. That is the reason for the crisis.

I said years ago what Conservative and Labour councils throughout the country said—"For heaven's sake recognise the fact that you are creating an enormous housing crisis." I repeat, for the benefit of hon. Members who have said that they did not hear any policy statement, that one way in which to tackle the problem is to allow local authorities to use capital receipts. The hon. Member for Hornsey and Wood Green wanted to do that. He claimed, possibly correctly, to be the first Conservative Member to invent the right to buy. He also said that local authorities should keep the receipts and use them for housing. As I said in Question Time, when the hon. Member for Hornsey and Wood Green pushed for that he was moved to Northern Ireland. The Secretary of State said I was insulting Northern Ireland by saying that. I do not agree. The Prime Minister insulted Northern Ireland and her housing Minister, because he was right.

Photo of George Young George Young , Ealing Acton

Is the hon. Gentleman saying that my hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi) was the housing Minister? Perhaps he would like to give the dates.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

I am referring to the first years of the Conservative Government—1979 and 1980.

Photo of George Young George Young , Ealing Acton

I think that the hon. Gentleman will find that, in 1979, my right hon. Friend the Member for Tonbridge and Mailing (Sir J. Stanley) was the housing Minister and remained such throughout that Parliament.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

My dates might be marginally wrong.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

I can help the hon. Gentleman. The time which the hon. Gentleman has in mind is when my hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi) was shadow housing spokesman. He was indeed moved to Northern Ireland, not in any sense for the reason that the hon. Gentleman is suggesting, but because the late Airey Neave was assassinated.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

The latter assertion is not the case, I am sure. It would be much more impressive if, instead of worrying about the dates when the hon. Member for Hornsey and Wood Green spoke on housing matters, the Minister concentrated on the issue, which is the use of capital receipts. If they were used now, we could allow local authorities and housing associations to start building, repairing and renovating again. That would not be significantly inflationary because, as I said to the Minister earlier, the skill crisis in the building industry would not allow us to use the money quickly. It could only be used over several years.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

If the hon. Gentleman is so certain that capital receipts would not have inflationary consequences and has succeeded in persuading his colleagues of that proposition, why is there no reference to that policy in his party's policy review?

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

In the policy review process, there was never intended to be any detailed statement of that policy— [Interruption.] That is right. We were reviewing the thrust, direction and aims of party policy, not the detail. That is coming along and has been given in many of my statements—and the Minister knows it. He need not worry about that.

I turn now to some of the comments made by other Conservative Members. The hon. Member for Gloucester (Mr. French) is a classic example of why the Government have got housing so seriously wrong. He talked about extending the right to buy and about what a marvellous idea it was. He suggested doing it this way, and extending it that way and talked about all the things that we could do to increase it. However, I want to ask the hon. Gentleman a question that he has not answered, asked himself or even thought of. If we sell all the rented properties, where will the sons and daughters of the people who have bought those homes, or the local people, find somewhere to rent? In the hon. Gentleman's own area the local people cannot find places to rent. Those local people, their sons and daughters, the postmen, teachers and others cannot find anywhere to rent because about 1·25 million houses have disappeared from the rented sector in the past 10 years. Half have been sold and not replaced in the council sector and the other half have disappeared from the much-loved private sector. Why? Because the Government have failed to address the issue of housing finance. It does not pay to replace houses for councils, housing associations or the private sector. Therefore, they are all selling their properties. Even now, housing associations are not back to the position they were in in the mid-1970s. How on earth can the housing association movement, which has recently made public statements on this aspect, make up the difference that has come about because of the cuts in local authority housing?

The hon. Member for Gainsborough and Horncastle (Mr. Leigh) said that repossessions are not caused by interest rates, or not to any great extent. That would be laughable if it was not so tragic. He said that repossessions were caused mainly by unemployment and marital breakdowns. My hon. Friend the Member for Newham, North-West (Mr. Banks) dealt with the point well. Someone with a £40,000 mortgage on which the interest rate was 9·75 per cent. when the mortgage was taken out but which then increased to 13·5 per cent. would have to pay an extra £1,016 per annum. If we are not saying that that can lead to economic distress, what are we saying?

The figures given by the building societies are phenomenal. The figures for repossessions have escalated dramatically. In what was effectively the last year of the Labour Government—the figures carry over to the following year—there were 3,020 repossessions. That was in 1980. Every year thereafter the figure has risen until in 1987—the last year for which figures have been given—repossessions numbered 22,630—a sevenfold increase, which is a far larger increase that that for house purchase and, of course, that figure will increase even more. The dream of home ownership is being turned into the nightmare of bed and breakfast, paid for by the ratepayers who are soon to be the poll tax payers.

Instead of silly schemes and the Minister trying desperately to react by saying, "Take in a lodger to help pay your bills", without recognising that he must change the law to enable that to happen, he should call in the lending societies, including the banks and the other finance companies and say, "One in 10 of all homeless families are homeless because they cannot pay their mortgages. It is unacceptable that such families with children should go into bed and breakfast. Let's call them in and have a system whereby the local authority or the housing associations could buy the property from you, the lending organisations, and convert it into a rented property." I accept that some funds will be needed for that, but the amount would not be enormous.

Alternatively—the Halifax and other building societies are prepared to consider this—we could have the system that I understand was used in the 1930s in which the ownership was converted and the property became a rented property with the lending organisation either managing the property or paying a housing association to do so. There are many other innovative schemes, but all that the Minister can suggest is, "Take in a lodger" because, he says, if things go wrong, it is easier to get them out under the provisions of the 1988 legislation. He says that such people should simply be put into the street—

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

I shall give way to the Minister in a moment. The Minister said that the Labour party wants to create queues. Well, we did not create the queue for the cardboard boxes, did we? We did not triple, quadruple or whatever the housing list queues, did we? The Conservative party did all that and those queues are a disgrace.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

Yes, I shall give way to the Minister on one last occasion.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Housing)

On the subject of lodgers, is it the hon. Gentleman's position that building societies should be encouraged to place obstacles in the path of those who wish to take in lodgers? That was the only point that I addressed in my speech on this matter, so perhaps the hon. Gentleman will tell us his position.

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

Subject to satisfactory safeguards, I have no objection to the Minister, the building societies and the other lending organisations getting together to allow that to happen. However, any such provisions must not mean that when the home owner wants to get rid of an individual or when the building society has to repossess because that idea does not work, those people then become homeless almost overnight, adding to the cardboard box queue.

The hon. Member for Walthamstow (Mr. Summerson) should be ashamed of himself for using the example that he did. He is one of those Conservative Members who represent the dinosaur tendency. Anyone who believes that all those homeless and hungry kids who are begging on the streets can get £600 per week for doing that must be out of his tiny little mind. I emphasise that teenage children are begging in the streets and that most of us are seeing that for the first time in our lives, because one would have to be 60 or 70 to have seen it before. The vast majority of those young people are desperate.

Prior to being elected to the House in 1979, I was a probation officer in one of the most difficult areas of London, but even with homeless youngsters being unloaded at King's Cross and Euston, I could always find such people a roof over their heads unless they were violent or drunk. That cannot be done now. They have to be told to take their place in the queue for the boxes or to take their place in the queues for council homes—

Photo of Mr Clive Soley Mr Clive Soley , Hammersmith

I advise the hon. Gentleman that the Government have created a major and drastic housing crisis, the like of which no one in this country has seen since the end of the second world war. That crisis is hitting the home owner, those who rent in both the private and the public sectors, and it is even hitting the Government. They own no fewer than one dozen homes in my constituency where we have one of the worst housing problems in the country. Those properties have been empty for up to 10 years, yet the Government refuse to let the housing associations take them over. I am talking about three and four-bedroomed houses and flats. The Government say, "We are keeping them empty because they are near Wormwood Scrubs prison and in the long term we want to knock them down to provide car parking and landscaping." That is a measure of the Government's disgraceful policy and it will be thrown out with the Government.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment) 6:46 pm, 13th December 1989

What a disgraceful display of synthetic indignation—[Interruption.] This three-and-a-half hour debate has been the Opposition's chance to tell us about their housing policies—[HON. MEMBERS: "No."]

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. The Minister has only got half a sentence out.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

The Opposition have blown their chance. They have shown that they do not have any coherent housing policy—

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I shall give way to the hon. Lady in a moment.

The hon. Member for Hammersmith (Mr. Soley) is not normally as muddled and incoherent as he has been today, but today he has had to clutch at straws and to rely on some dubious statistics. I shall take just one example of his dubious statistics. I refer to the number of people accepted as homeless by local authorities as a result of mortgage arrears. That number has remained stable over recent years and months—

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

The proportion of homeless due to mortgage arrears is only 6 per cent., which is down from 10 per cent. three years ago.—

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I know that Opposition Members do not want the facts to interfere with their argument—

Photo of John Battle John Battle , Leeds West

Will the Minister give way on those figures?

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. The Minister is clearly not giving way.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I shall give way a number of times, but first I wish to stress the positive side. The Government believe that this has been a successful decade of sustained success in housing. We have won the argument today, as we have throughout the decade. We have increased the quantity and quality of the nation's housing stock. There are now 2 million—[Interruption.]

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. This has been a well-conducted debate. The Minister has a right to make his speech in his own way.

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

This takes me back to just over 10 years ago, when I was the housing chairman in Wandsworth. The Labour party adopted the same tactics then and tried to shout me down and pour cold water on the Conservative housing policies. I am pleased to say that, in a decade of Conservative control in Wandsworth, the proportion of owner-occupation has increased from 27 per cent. to 54 per cent. This year we have seen capital investment by the local authority in Wandsworth of about £100 million. That Conservative council now has control over the best housing stock in inner London as a result of Conservative policies.

I know from experience that the Labour party does not like Conservative policies, because it has not come to terms with the demand for home ownership.

Photo of George Howarth George Howarth Shadow Spokesperson (Environment, Food and Rural Affairs)

A few moments ago, the Minister said that this had been a decade of great success for the Government's housing policy. If that is so, why are none of these successes mentioned in the Government's amendment?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

I know that, in the hon. Gentleman's terms, achieving a massive increase in home ownership and responding to people's demands to exercise home ownership does not constitute a success. The Government have increased the percentage of home ownership to 68 per cent. We still have not gone as far as we would wish, because we know that, of those people under 55, about 90 per cent. still aspire to becoming home owners. However, we are entitled to take stock in this debate and say that our home ownership policies have been extremely successful during this decade.

It is not only in the owner-occupied sector that we have responded to the people's needs and aspirations; 160,000 more units of sheltered accommodation have been made available in the past decade through local authorities and housing associations. There is also a healthy private sector market in sheltered accommodation. Shared ownership —almost unheard of a decade ago—is flourishing under this Government. More than 124,000 houses have been sold under the low-cost home ownership scheme since 1979. We have begun to deregulate the private rented market. We have shorthold and assured tenancies and a business expansion scheme that has attracted much more private investment into the private rented market.

We have been pursuing a host of other imaginative policies during the past 10 years—none more so than the tenants charter, tenants choice, the priority estates project and Estates Action, on which £190 million was spent this year.

We are still coming forward with new ideas—Conservative-controlled councils are coming forward with most of them. One such idea, referred to by my hon. Friend the Member for Ealing, Acton (Sir G. Young), was cash incentives, pioneered by Conservative councils and taken up by the less imaginative Socialist councils. Those cash incentives have a part to play in solving the homelessness problem.

We have revised the proposals so that we shall now be able to allow generous payments—sometimes more than £20,000—to people who wish to move from their existing council accommodation into the private sector. As has been said, that immediately creates a vacancy that can be used for somebody with a real housing need. That positive policy was put forward by the Government and is being emulated by some of the Socialist housing authorities. Next year, we hope to extend that scheme into the housing association sector, and we hope that about 2,500 lettings will arise from the similar tenants incentive scheme for housing associations.

Photo of Paul Flynn Paul Flynn , Newport West

Is the Minister urging other authorities to follow the example of the loony Right Westminster council and its barbarous decision to sell graveyards and try to turn them into building blocks?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

It is apparent from the hon. Gentleman's remarks that he has not been in on this debate. If he looks at Westminster city council's housing record, he will find that the council spends more on the repair and maintenance of its council stock per unit than any other council in the country, bar one. That shows that it has a sincere concern for improving the housing conditions in Westminster.

My hon. Friend the Member for Mid-Staffordshire (Mr. Heddle) gave some wise advice to those facing difficulties with their mortgages. He advised them to seek their building society's advice before going into the secondary mortgage market. I hope that his advice will be carefully heeded.

The proposal to extend lodgings and encourage more people to take in lodgers has also been mentioned. I find it amazing that Opposition Members do not think it a good idea to make the best use of the nation's housing stock by encouraging and facilitating the taking in of lodgers by those who wish to do so. There are many people who would like—[Interruption.]

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. It is unseemly to shout across the Chamber in this way. The Minister must be given a fair chance to answer this debate.

Photo of Mr Terry Patchett Mr Terry Patchett , Barnsley East

In view of the Minister's enthusiasm for lodgers, how many lodgers is he willing to take?

Photo of Christopher Chope Christopher Chope Parliamentary Under-Secretary (Department of Environment)

That must be a decision for each individual householder. I have been a lodger in the past, and I have an unsolicited testimonial which says that I was quite a good lodger. I have also taken in lodgers in the past and would do so again. Whether I would take the hon. Gentleman as a lodger is a more difficult question.

It is most important to encourage maximum investment in housing. The Government believe that we should bring public capital investment and private capital investment together to solve the nation's housing problems. During the past decade, there has been a massive increase in private capital investment in housing. Last year it was £14·8 billion—up from £4·7 billion in 1979, a threefold increase. That means that since 1979 public and private capital investment in housing has gone from £8 billion to over £18 billion. The way to provide better quality housing is to get the public and private sectors working together. Good housing flourishes under a Government who recognise that the public and private sectors work together. It also needs a Government who work with the market rather than against it.

We must ensure that our housing stock is used to the full. I am amazed that the scandal of empty properties presided over by Labour councils up and down the country still exists. Hon. Members who represent Lambeth had a cheek to respond in the way that they did, given that Lambeth council presides over so many empty properties.

We must ensure that taxpayers' resources are directed to those in the greatest need. Above all, we want realistic solutions to housing problems. The Opposition have failed to tell us their policies. Their attitude is totally negative. We had the right policies for the 1980s, and we have them for the 1990s as well. I ask the House to reject the motion and accept the amendment.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 214, Noes 279.

Division No. 17][7.00 pm
AYES
Abbott, Ms DianeCampbell, Ron (Blyth Valley)
Adams, Allen (Paisley N)Campbell-Savours, D. N.
Allen, GrahamCanavan, Dennis
Anderson, DonaldClark, Dr David (S Shields)
Archer, Rt Hon PeterClarke, Tom (Monklands W)
Armstrong, HilaryClay, Bob
Ashdown, Rt Hon PaddyClelland, David
Ashley, Rt Hon JackClwyd, Mrs Ann
Ashton, JoeCohen, Harry
Banks, Tony (Newham NW)Coleman, Donald
Barnes, Harry (Derbyshire NE)Cook, Robin (Livingston)
Barnes, Mrs Rosie (Greenwich)Corbett, Robin
Barron, KevinCorbyn, Jeremy
Battle, JohnCousins, Jim
Beckett, MargaretCox, Tom
Beith, A. J.Crowther, Stan
Benn, Rt Hon TonyCryer, Bob
Bennett, A. F. (D'nt'n & R'dish)Cunliffe, Lawrence
Bermingham, GeraldCunningham, Dr John
Bidwell, SydneyDalyell, Tam
Blair, TonyDarling, Alistair
Blunkett, DavidDavies, Rt Hon Denzil (Llanelli)
Boateng, PaulDavies, Ron (Caerphilly)
Boyes, RolandDavis, Terry (B'ham Hodge H'I)
Bradley, KeithDewar, Donald
Bray, Dr JeremyDixon, Don
Brown, Gordon (D'mline E)Doran, Frank
Brown, Nicholas (Newcastle E)Douglas, Dick
Brown, Ron (Edinburgh Leith)Duffy, A. E. P.
Bruce, Malcolm (Gordon)Dunwoody, Hon Mrs Gwyneth
Buchan, NormanEadie, Alexander
Buckley, George J.Eastham, Ken
Caborn, RichardEvans, John (St Helens N)
Callaghan, JimEwing, Harry (Falkirk E)
Campbell, Menzies (Fife NE)Ewing, Mrs Margaret (Moray)
Fatchett, DerekMichael, Alun
Faulds, AndrewMichie, Bill (Sheffield Heeley)
Fearn, RonaldMitchell, Austin (G't Grimsby)
Field, Frank (Birkenhead)Moonie, Dr Lewis
Fields, Terry (L'pool B G'n)Morgan, Rhodri
Fisher, MarkMorley, Elliot
Flannery, MartinMorris, Rt Hon A. (W'shawe)
Flynn, PaulMorris, Rt Hon J. (Aberavon)
Foot, Rt Hon MichaelMowlam, Marjorie
Foster, DerekMullin, Chris
Fraser, JohnMurphy, Paul
Fyfe, MariaOakes, Rt Hon Gordon
Galloway, GeorgeO'Brien, William
Garrett, John (Norwich South)Orme, Rt Hon Stanley
George, BruceOwen, Rt Hon Dr David
Gilbert, Rt Hon Dr JohnPatchett, Terry
Godman, Dr Norman A.Pendry, Tom
Golding, Mrs LlinPike, Peter L.
Gordon, MildredPowell, Ray (Ogmore)
Gould, BryanPrescott, John
Graham, ThomasPrimarolo, Dawn
Griffiths, Nigel (Edinburgh S)Quin, Ms Joyce
Griffiths, Win (Bridgend)Radice, Giles
Grocott, BruceRees, Rt Hon Merlyn
Hardy, PeterReid, Dr John
Harman, Ms HarrietRoberts, Allan (Bootle)
Haynes, FrankRobertson, George
Heffer, Eric S.Rogers, Allan
Henderson, DougRooker, Jeff
Hinchliffe, DavidRoss, Ernie (Dundee W)
Hoey, Ms Kate (Vauxhall)Rowlands, Ted
Hogg, N. (C'nauld & Kilsyth)Ruddock, Joan
Home Robertson, JohnSalmond, Alex
Hood, JimmySedgemore, Brian
Howarth, George (Knowsley N)Sheerman, Barry
Howells, GeraintShore, Rt Hon Peter
Howells, Dr. Kim (Pontypridd)Short, Clare
Hoyle, DougSkinner, Dennis
Hughes, John (Coventry NE)Smith, Andrew (Oxford E)
Hughes, Roy (Newport E)Smith, C. (Isl'ton & F'bury)
Hughes, Simon (Southwark)Smith, Rt Hon J. (Monk'ds E)
Illsley, EricSmith, J. P. (Vale of Glam)
Ingram, AdamSnape, Peter
Janner, GrevilleSoley, Clive
Johnston, Sir RussellSpearing, Nigel
Jones, Martyn (Clwyd S W)Steinberg, Gerry
Kaufman, Rt Hon GeraldStott, Roger
Kennedy, CharlesStraw, Jack
Kinnock, Rt Hon NeilTaylor, Mrs Ann (Dewsbury)
Lambie, DavidTaylor, Rt Hon J. D. (S'ford)
Lamond, JamesTaylor, Matthew (Truro)
Leadbitter, TedThompson, Jack (Wansbeck)
Leighton, RonTurner, Dennis
Litherland, RobertWall, Pat
Livingstone, KenWallace, James
Livsey, RichardWalley, Joan
Lloyd, Tony (Stretford)Warden, Gareth (Gower)
Lofthouse, GeoffreyWareing, Robert N.
Loyden, EddieWatson, Mike (Glasgow, C)
McAllion, JohnWelsh, Andrew (Angus E)
McCartney, IanWelsh, Michael (Doncaster N)
Macdonald, Calum A.Wigley, Dafydd
McFall, JohnWilliams, Rt Hon Alan
McGrady, EddieWilliams, Alan W. (Carm'then)
McKay, Allen (Barnsley West)Wilson, Brian
Maclennan, RobertWinnick, David
McNamara, KevinWise, Mrs Audrey
Madden, MaxWorthington, Tony
Mahon, Mrs AliceWray, Jimmy
Martin, Michael J. (Springburn)Young, David (Bolton SE)
Martlew, Eric
Maxton, JohnTellers for the Ayes:
Meacher, MichaelMr. Frank Cook and
Meale, AlanMr. Jimmy Dunnachie.
NOES
Alexander, RichardAmos, Alan
Alison, Rt Hon MichaelArbuthnot, James
Amess, DavidArnold, Jacques (Gravesham)
Arnold, Tom (Hazel Grove)Garel-Jones, Tristan
Ashby, DavidGill, Christopher
Aspinwall, JackGlyn, Dr Alan
Atkins, RobertGoodhart, Sir Philip
Atkinson, DavidGoodlad, Alastair
Baker, Nicholas (Dorset N)Gorman, Mrs Teresa
Baldry, TonyGow, Ian
Banks, Robert (Harrogate)Greenway, Harry (Ealing N)
Beaumont-Dark, AnthonyGregory, Conal
Bellingham, HenryGrist, Ian
Bendall, VivianGrylls, Michael
Bennett, Nicholas (Pembroke)Gummer, Rt Hon John Selwyn
Benyon, W.Hamilton, Neil (Tatton)
Bevan, David GilroyHampson, Dr Keith
Biffen, Rt Hon JohnHanley, Jeremy
Blaker, Rt Hon Sir PeterHannam,John
Body, Sir RichardHargreaves, A. (B'ham H'll Gr')
Bonsor, Sir NicholasHargreaves, Ken (Hyndburn)
Boscawen, Hon RobertHarris, David
Boswell, TimHaselhurst, Alan
Bottomley, Mrs VirginiaHawkins, Christopher
Bowden, A (Brighton K'pto'n)Hayhoe, Rt Hon Sir Barney
Bowden, Gerald (Dulwich)Hayward, Robert
Bowis, JohnHeathcoat-Amory, David
Boyson, Rt Hon Dr Sir RhodesHeddle, John
Braine, Rt Hon Sir BernardHicks, Mrs Maureen (Wolv' NE)
Brandon-Bravo, MartinHicks, Robert (Cornwall SE)
Brazier, JulianHiggins, Rt Hon Terence L.
Bright, GrahamHind, Kenneth
Brooke, Rt Hon PeterHogg, Hon Douglas (Gr'th'm)
Brown, Michael (Brigg & Cl't's)Hordern, Sir Peter
Browne, John (Winchester)Howard, Michael
Bruce, Ian (Dorset South)Howarth, Alan (Strat'd-on-A)
Buck, Sir AntonyHowarth, G. (Cannock & B'wd)
Budgen, NicholasHowe, Rt Hon Sir Geoffrey
Burns, SimonHowell, Rt Hon David (G'dford)
Burt, AlistairHughes, Robert G. (Harrow W)
Butcher, JohnHunt, Sir John (Ravensbourne)
Butler, ChrisHunter, Andrew
Butterfill, JohnIrvine, Michael
Carlisle, Kenneth (Lincoln)Irving, Charles
Cash, WilliamJack, Michael
Channon, Rt Hon PaulJanman, Tim
Chapman, SydneyJessel, Toby
Chope, ChristopherJohnson Smith, Sir Geoffrey
Churchill, MrJones, Gwilym (Cardiff N)
Clark, Hon Alan (Plym'th S'n)Jones, Robert B (Herts W)
Clark, Dr Michael (Rochford)Jopling, Rt Hon Michael
Clark, Sir W. (Croydon S)Key, Robert
Clarke, Rt Hon K. (Rushcliffe)King, Roger (B'ham N'thfield)
Colvin, MichaelKirkhope, Timothy
Conway, DerekKnapman, Roger
Coombs, Anthony (Wyre F'rest)Knight, Greg (Derby North)
Coombs, Simon (Swindon)Knowles, Michael
Cormack, PatrickKnox, David
Couchman, JamesLamont, Rt Hon Norman
Cran, JamesLatham, Michael
Critchley, JulianLawrence, Ivan
Currie, Mrs EdwinaLawson, Rt Hon Nigel
Davies, Q. (Stamf'd & Spald'g)Lee, John (Pendle)
Davis, David (Boothferry)Leigh, Edward (Gainsbor'gh)
Day, StephenLester, Jim (Broxtowe)
Devlin, TimLilley, Peter
Douglas-Hamilton, Lord JamesLloyd, Sir Ian (Havant)
Dover, DenLloyd, Peter (Fareham)
Dunn, BobLyell, Sir Nicholas
Durant, TonyMacfarlane, Sir Neil
Dykes, HughMacKay, Andrew (E Berkshire)
Emery, Sir PeterMaclean, David
Fallon, MichaelMcLoughlin, Patrick
Favell, TonyMcNair-Wilson, Sir Michael
Fenner, Dame PeggyMcNair-Wilson, Sir Patrick
Finsberg, Sir GeoffreyMadel, David
Fishburn, John DudleyMajor, Rt Hon John
Fookes, Dame JanetMalins, Humfrey
Forman, NigelMans, Keith
Forsyth, Michael (Stirling)Maples, John
Fox, Sir MarcusMarlow, Tony
Franks, CecilMarshall, Michael (Arundel)
French, DouglasMartin, David (Portsmouth S)
Maude, Hon FrancisSmith, Tim (Beaconsfield)
Mawhinney, Dr BrianSoames, Hon Nicholas
Maxwell-Hyslop, RobinSpeed, Keith
Mellor, DavidSpeller, Tony
Meyer, Sir AnthonySpicer, Sir Jim (Dorset W)
Miller, Sir HalSpicer, Michael (S Worcs)
Mills, IainSquire, Robin
Miscampbell, NormanStanley, Rt Hon Sir John
Mitchell, Andrew (Gedling)Steen, Anthony
Mitchell, Sir DavidStern, Michael
Moate, RogerStewart, Allan (Eastwood)
Monro, Sir HectorStewart, Andy (Sherwood)
Montgomery, Sir FergusStokes, Sir John
Moore, Rt Hon JohnStradling Thomas, Sir John
Morris, M (N'hampton S)Sumberg, David
Morrison, Sir CharlesSummerson, Hugo
Moss, MalcolmTapsell, Sir Peter
Moynihan, Hon ColinTaylor, Ian (Esher)
Mudd, DavidTaylor, John M (Solihull)
Neale, GerrardTaylor, Teddy (S'end E)
Nelson, AnthonyTebbit, Rt Hon Norman
Nicholls, PatrickTemple-Morris, Peter
Nicholson, David (Taunton)Thompson, D. (Calder Valley)
Nicholson, Emma (Devon West)Thompson, Patrick (Norwich N)
Onslow, Rt Hon CranleyThorne, Neil
Oppenheim, PhillipThornton, Malcolm
Paice, JamesThurnham, Peter
Parkinson, Rt Hon CecilTownend, John (Bridlington)
Patnick, IrvineTredinnick, David
Patten, Rt Hon Chris (Bath)Trippier, David
Patten, John (Oxford W)Trotter, Neville
Pattie, Rt Hon Sir GeoffreyTwinn, Dr Ian
Pawsey, JamesVaughan, Sir Gerard
Porter, Barry (Wirral S)Viggers, Peter
Porter, David (Waveney)Wakeham, Rt Hon John
Powell, William (Corby)Waldegrave, Hon William
Raison, Rt Hon TimothyWalden, George
Redwood, JohnWalker, Bill (T'side North)
Renton, Rt Hon TimWaller, Gary
Rhodes James, RobertWard, John
Riddick, GrahamWardle, Charles (Bexhill)
Ridley, Rt Hon NicholasWarren, Kenneth
Ridsdale, Sir JulianWatts, John
Rifkind, Rt Hon MalcolmWells, Bowen
Rossi, Sir HughWheeler, John
Rost, PeterWiddecombe, Ann
Rowe, AndrewWiggin, Jerry
Sackville, Hon TomWilshire, David
Sainsbury, Hon TimWinterton, Mrs Ann
Scott, Rt Hon NicholasWinterton, Nicholas
Shaw, David (Dover)Wolfson, Mark
Shaw, Sir Giles (Pudsey)Wood, Timothy
Shaw, Sir Michael (Scarb')Woodcock, Dr. Mike
Shelton, Sir WilliamYeo, Tim
Shephard, Mrs G. (Norfolk SW)Young, Sir George (Acton)
Shepherd, Colin (Hereford)
Shersby, MichaelTellers for the Noes:
Sims, RogerMr. David Lightbown and
Skeet, Sir TrevorMr. Stephen Dorrell.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments), and agreed to.

MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,That this House 'welcomes Her Majesty's Government's commitment to home ownership throughout the last ten years which has enabled many more people to own their homes; recognises the benefits which have resulted from the introduction of the Right to Buy for council tenants; further recognises that the Government's sound economic policies have played an important part in facilitating the growth in owner-occupation; and urges the Government to maintain those policies in the interests of home owners, first-time buyers and the nation as a whole.'.