It is interesting that this emergency provision, is proposed by the Government in a crisis as a prelude to legislation to be introduced next week, contains retrospective provisions. I am not one of those who believe that legislation should never have retrospective provisions. There are occasions when retrospection is useful. Up to now, the Government have taken the view that retrospection is not a principle which they should easily endorse.
I recall that, when a Labour Government wanted to restore civic rights to 11 Clay Cross councillors—rights which had already been restored to 400 Scottish and Welsh councillors in a similar position—Sir Michael Havers, who was to become Attorney-General, rushed to the Dispatch Box to say that retrospective legislation was a terrible thing. That is an illustration of the Government's double standards. When they want to worm their way out of a crisis which their policies have produced, that argument goes quickly by the board. It is an interesting comparison which does not do the Government much credit.
The ways and means resolution has been introduced because of the stagnant housing market, the unemployment increases in the construction industry and the fact that, in 1991, more than 100,000 houses were repossessed from people who had been persuaded by the Government that home ownership was the only possible way of existing. That is the background to the debate.
There is a useful note from the Library about recent developments in mortgage arrears. It links the Chancellor's statement about the resolution to the actual position. I do not think that the modest changes in stamp duty for eight months will galvanise the housing market into action or restore all the building industry jobs. Nor do I think that the Tory Government's failing fortunes will be restored in time for the election.
The research note points out that it is not just the fact that people are facing repossession that is causing the housing market to be in difficulty. A large number of houses are standing empty because they have been repossessed or cannot be sold. The research note says:
Janet Ford of Warwick University conducted a survey of 29 mortgage lenders in March 1991 which revealed new record levels of short term (two to five months) and serious (over six months) arrears. The survey, which was funded by the Bank of England, found that at the end of March approximately 784,000 loans were two or more months in arrears, representing just over 8 per cent. (one in twelve) of the total number of mortgages outstanding with the 29 lenders. Additionally, the survey revealed that the number of people with arrears of between three to five months, in March of 1991, outnumbered those people owing two months payments for the first time since 1985. These findings have been cited as an indication that for an increasing number of borrowers, the position is a more serious and persistent one than has been the case in the past.
That is one of the important reasons why the ways and means resolution will not provide an answer to the deep-seated defects in the housing construction industry, which arise from the Government's disastrous housing policies. Those policies resulted in many people becoming the owners of houses—unfortunately, only temporarily but—later facing repossession. Several hundred thousand people face the threat of repossession.
There was a news item in my local evening paper, the Telegraph and Argus, on Tuesday 14 January 1992. The Minister might care to comment on it when he replies. Headed "Bickering delays bid to end home loan misery", the report says:
Moves to ease the nightmare of homes repossession have yet to take effect, it emerged today.
Mortgage lenders and housing associations are still reported to be in disagreement over the mortgages-to-rent scheme which is central to the Government's mortgage rescue plans announced before Christmas.
The Chancellor of the Exchequer made a statement that the Government would allow lenders to lend money to the housing associations to buy properties and allow the people in arrears to stay in their home. That agreement has not been reached, because the housing associations cannot get the money at a sufficiently low level of interest. That is one of the underlying faults: the level of interest is far too high. It is inhibiting not only the housing market—that is the reason for the resolution—but industry. That is why we have an ever-soaring rate of unemployment and why, in the near future, the unemployment figures will demonstrate an increase in that terrible waste of ability and people's lives. Lives are wrecked by unemployment, which in turn means that they face the possibility of repossession due to mortgage arrears.
When the Chancellor of the Exchequer made his statement, he covered several points. The ways and means resolution—and the ensuing legislation that will come before the House next week—was one of them. I doubt whether all the people who, as a result of the Government's high interest rate policies, face unemployment and repossession because they cannot keep up their mortgage payments regard it as a price worth paying to support the Government policies of which they are victims. People are being forced out of their houses and homes repossessed at a rate never experienced since the war.
My second point on the ways and means resolution and the housing crisis that it represents is that many people have been forced into home ownership by the Government's policies. The Government have failed to provide local authorities with the means to build houses for rent to replace the houses which local authorities were forced to sell off, yet in turn, the revenue from the forced sales has been denied to the local authorities. Houses have been sold off so that they are no longer available to rent. Therefore, many people have been forced to look round for a house to buy. Some of them are in mortgage arrears unquestionably as a result of taking on a commitment which was too much for their income. That was directly encouraged by the Government.
It is worth pointing out that, in 1977, 112,000 local authority dwellings were constructed. The Government are fond of making comparisons between the period when the Labour Government were in office and their period of office. In 1986, there were 18,500—a drop of 100,000—and that figure has dropped even further. That is why we are debating this paltry ways and means resolution, which is part of a pattern.
People are finding it difficult to get hold of somewhere to live at a decent price. That is also reflected in the increase in the number of homeless people. In 1979, 55,000 people were homeless—the figures were provided by the Library—and that figure was too high. That was under a Labour Government, and it should have been less. In 1988, the figure had shot up to 120,000 and this year it is above that figure. It is all part of the pattern.
The ways and means resolution will reduce stamp duty for eight months to get builders back to work and get the housing market moving, when 120,000-plus people are homeless, and when even the Government admit that the measure will not galvanise the housing market into action, but will be peripheral. It is wrong for the Government to be so inert over this policy and to do so little so late, when all the signs were there. Indeed, my hon. Friends on the Opposition Front Bench have been pressing the Government to introduce a mortgage-into-rent scheme so that people do not face eviction in their hundreds of thousands as they have done because of Government policies.
In Bradford, including my constituency of Bradford, South, the local authority has been forced to sell off 14,500 out of 18,000 houses. Now they let virtually only flats and maisonettes, because the vast majority of houses have already been sold. Would it not be easier to do as Labour is promising to do, and sensibly to inject revenues from house sales into the house building industry so that local authorities can get to work building houses at a rent that people can afford?
It is no good the Government talking about home ownership as the only path to a roof over one's head. The reality is that a significant proportion of the population will only be able to afford houses to rent until they build up money for a deposit, are certain of their own finances, and can go down that path.
Immediately, there is a demand for houses to rent at a level that people can afford. That simply is not available in the private sector, or in the housing association sector. Housing associations are short of funds too and simply cannot meet the demand for houses.
Labour's policy is very good. The Conservatives are nearly always asking what Labour intends to do in one way or another. Labour's policy of releasing the funds which the Government have deliberately denied local authorities, at a sensible pace so that we do not outstrip the capacity of the building industry, and maintaining an increased pace of building by local authorities, will help to solve some of the problems. It will do so far more effectively than the ways and means resolution, which injects only about £400 million and will in no way help existing home owners who face repossession.
The only people it will help are those who are going to buy a house and who will be helped to make the decision by an extra relief of £200, £300 or £500. It will have a marginally beneficial effect, but that is all. It will not answer the important crisis which is facing us.
I hope that the Minister will announce something more widely effective than the ways and means resolution. Even though it would be stealing the Labour party's clothes, I would welcome an announcement that the Government would be prepared to use the £5·5 billion which is available for the sort of housing that people can afford—whether low-cost housing to buy or low-cost housing to rent.
To require local authorities to sell off houses without any replacement is one of the major reasons why we are in the housing crisis and one of the major reasons why we have cardboard cities not just in London, but in every major city and town throughout the country.