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New Clause—(Power To Increase Rent Under Part Ii In Certain Cases)

Volume 467: debated on Wednesday 13 July 1949

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If, in the case of a dwelling in respect of the provision or improvement of which assistance has been given under section eight of this Act, being a dwelling to which works (other than works for the purposes of the execution of which assistance has been so given) have been executed at a time when the conditions specified in subsection (1) of section eleven of this Act are required to be observed with respect to the dwelling, an application in that behalf is made to the local authority, they may direct that for the purposes of this Part of this Act the maximum amount of the rent payable by the occupier of the dwelling shall be increased by such amount as may be specified in the direction, not exceeding an amount calculated at a rate per annum of eight per cent. of the cost of executing the works; and where a direction is given under this section in relation to a dwelling on any occasion—

  • (a) references in paragraph (c) of that subsection to the amount which the rent payable by the tenant of the dwelling is not to exceed shall, as respects any period after the giving of the direction and before a subsequent direction is given under this section in relation to the dwelling or the direction is superseded by reason of the application of the said conditions by virtue of the giving of further assistance under the said section eight, whichever event first occurs, be construed in relation to the dwelling, for the purposes of this Part of this Act and, where subsection (2) of section fourteen of this Act applies, for the purpose the Housing (Rural Workers) Acts, 1926 to 1942, as references to that amount as increased in accordance with the direction given on that occasion and with any direction given under this section in relation to the dwelling on a previous occasion which has not been superseded as aforesaid; and
  • (b) the local authority shall cause to be recorded in the appropriate Register of Sasines a notice in the prescribed form setting forth the effect of the direction, and the cost of such recording shall be repaid to the local authority by the owner for the time being of the dwelling.—[Mr. Woodburn.]
  • Brought up, and read the First time.

    I beg to move, "That the Clause be read a Second time."

    It has turned out that if, in the case of a house which now comes under the Rent Restrictions Act, a grant is given to improve the House under this Bill, whereby the house comes under the conditions of the Bill, and the owner of the house goes on to make further improvements at his own expense, he will not have the benefits he at present has under the Rent Restrictions Act. Under the Rent Restrictions Act, if an owner makes improvements at his own expense, he is entitled to charge 8 per cent. on the rent. Under this Bill, if he makes further improvements after receiving the benefit of a grant under the Bill, he would be denied the right to charge that 8 per cent.

    The passing of this Bill is not intended to deprive a person who wishes to make improvements on his house of his rights under the Rent Restrictions Act, and the purpose of the Clause is to restore the house to that position under the Rent Restrictions Act. If an owner makes further improvements, the Clause empowers the local authority to give a direction that the owner may increase the rent by an amount specified in the direction not exceeding 8 per cent. of the cost of the works carried out at his own expense. This is purely a restoration of the existing conditions if the house has been dealt with under the grants given under this Bill.

    This Clause coming upon us like this with little notice, necessitates my asking another question. As I understand it, the allowance of 6 per cent., about which we have argued so strongly, is in respect of a proportion of grant made available for improvement. But a further stage of improvement may take place, that grant having been used according to this new Clause, and for that the second part of the grant of 8 per cent. of the cost is to be allowed.

    I see that the right hon. Gentleman shakes his head, but do we not read, in this new Clause, that 8 per cent. is allowed here as an increase in rent, whereas only the 6 per cent. was allowed earlier.

    Where public money is involved, the grant is 6 per cent. Where an owner is using his own money and no public money is involved, the permitted increase is 8 per cent. What we are doing here is restoring, in regard to that house, the possibility of the local authority's empowering the owner to increase the rent up to 8 per cent. on money spent by him.

    It seems inconsistent; it seems to add certain weight to our previous argument that 6 per cent. was too little if, in fact, an improvement grant of 6 per cent. only is allowed, and under the Rent Restriction Act, a grant of 8 per cent. of the capital employed is allowed.

    Is the hon. and gallant Member suggesting that we should make it a uniform grant of 6 per cent.?

    No, I am suggesting that it should be 8 per cent. as we have suggested all along.

    Question put, and agreed to.

    Clause read a Second time, and added to the Bill.