(1) ( a) the Secretary of State may if he thinks fit by order provide that, as from such date as may be specified in the order, the rent. in the case of any dwelling-house subject to a controlled tenancy, recoverable from the tenant shall, notwithstanding anything in the terms of the tenancy or any enactment, be fixed in relation to the amount of the gross annual value thereof in such manner as the order may provide.
( b) An order made under this section may contain such incidental consequential and supplementary provisions as the Secretary of State thinks necessary or expedient for giving effect to the purposes of the order.
( c) For the purposes of this subsection "controlled tenancy" has the same meaning as in the Rent Act, 1957, and "gross annual value" in relation to any dwelling-house to
which an order made under this section applies means the gross annual value of such dwelling-house as shown in the valuation roll for the year 1961–62 or for any subsequent year, or, where the dwelling-house forms part only of the land or heritage shown in the valuation roll, such proportion of the gross annual value shown in the valuation roll for that land or heritage as may be agreed in writing between the landlord and the tenant or determined by the sheriff.
(2) ( a) The power to make an order conferred on the Secretary of State by this section shall be exercisable by statutory instrument and no order shall be made under this section unless a draft of the order has been laid before Parliament and approved by a resolution of each House of Parliament.
( b) Any such order may be amended or revoked by a subsequent order made in like manner and subject to the like conditions.
(3) Where, pursuant to an order made by the Secretary of State under this section, the rent of any dwelling-house subject to a controlled tenancy recoverable from the tenant thereof is increased the amount of such increase shall be disregarded in determining any question as to the rights of the tenant to retain possession of such dwelling-houses as a statutory tenant and such rights shall not be prejudiced or affected thereby.—[ Mr. Hendry.]
Brought up, and read the First time.
I beg to move, That the Clause be read a Second time. The Bill which we have before us this afternoon is an excellent one. It sets out to give greater help to those authorities who most need it; it sets out to do something that is very necessary in Scotland, namely, to provide houses for letting; it makes new provision for strengthening the hands of local authorities in dealing with houses unfit for human habitation, and it gives additional powers to the Secretary of State to deal with certain abuses which have crept in during the course of the years.
Unfortunately it is not complete. One very important provision is left out. It does not attempt to l with one of the basic causes of bad housing in Scotland. Undoubtedly the housing position in Scotland now is extremely bad. No houses have been built for letting for many years. Generally speaking, those houses which are privately owned in Scotland and are available for letting are gradually becoming more and more dilapidated. A great proportion of the houses in Scotland have reached a state of dilapidation when they can no longer reasonably be regarded as fit for human habitation. It is to deal with that basic fault in the Scottish housing system that I move the new Clause. A certain amount of misunderstanding seems to have arisen about it, and I want to tell the House, at the outset, just what the new Clause does not do.Why not tell us what it does do? The hon. Member would be in order if he told us that.
If the Clause is given a Second reading and thus forms part of the Bill, paragraph (3) will ensure that no house is removed from control. That is a very important matter, because pledges have been given at one time or another that during the lifetime of this Parliament the Government will not remove any houses from control.
I want to deal briefly with the difference between the restriction on rents and the control of houses under the main Acts, because the two things are very much tied up together. It must be pointed out that the position of Scotland is different from that of England, and I must develop my argument in order to show how the two situations differ. At the beginning of the First World War—in 1915—provision was made that the rents of houses both in England and Scotland would remain at their existing level and that no matter what the length of the lease the tenant of the house at that time would have security of tenure. That was right and proper when the country was in an exceptional situation, and for a long time afterwards, when there was a serious shortage of houses. In 1920 provision was made for a permitted increase in the rents chargeable for controlled houses throughout the United Kingdom. The amount varied from place to place according to circumstances, but generally speaking—On a point of order. I submit that the hon. Member has now been speaking for between five and ten minutes without having referred to the subject matter of his Clause, which deals with a very simple matter, namely, the amount of rent to be paid.
The hon. Member is developing his case for the new Clause. We should get on better if he were allowed to do so.
I am grateful to you, Mr. Deputy-Speaker.
8.0 p.m.
On a point of order, Mr. Deputy-Speaker. We are operating under a Guillotine Motion which has been imposed by the majority who sit on the Government benches. In all the circumstances, I submit to you, Sir, that you have a duty to the minority, the Opposition, to prevent hon. Members on the Government benches from abusing this timetable Motion by making speeches which are clearly out of order.
I have ruled that the hon. Gentleman is not out of order. If he gets out of order I shall call him to order.
I am obliged to you, Mr. Deputy-Speaker. Let me now return to what happened in 1920—
If the hon. Gentleman intends to deal with what happened in 1920. I submit that he is most definitely out of order.
I think the hon. Gentleman should be allowed to develop his case. It is always in order to develop a case. If I may say so with all due respect, the hon. Gentleman will get on more quickly if he is allowed to do so, and we shall save time.
I am obliged to you, Sir.
I have almost finished what I was going to say about 1920. By and large, in both kingdoms landlords were entitled to raise rents by roughly 40 per cent. The reason for that was that the cost of repairs and so on had increased during the war and it was necessary for landlords to increase rents in order to cover the increased costs. In England that produced a system which was quite reasonable for a number of years, but in Scotland there was a peculiarity which was purely Scottish. It was not an English problem at all. It was that the landlord had to pay part of the rates in respect of the house. During the years the tendency was for the rates to rise, with the result that the landlord had an increasing burden to bear out of his rents, which he could not pass on to the tenant. The general effect was that in Scotland the rents, instead of remaining stationary as they did in England, gradually diminished until the situation became so serious that in 1957 something had to be done about it. In 1957 a Bill was introduced which altered the situation. In England it was comparatively easy to do so, because just before then there had been a complete revaluation of all house property in England.For goodness sake get on with the new Clause.
Provision was made whereby the rents of controlled houses would be related to the rateable values, but in Scotland that was not possible because no such revaluation had taken place. In Scotland a small addition, which varied from time to time and from place to place, was permitted in these rents. But the effect of that was extraordinary, and it may surprise hon. Members to know that in many cases the rent, after the Rent Act was introduced in 1957, was actually less than it had been in 1920.
The tenant was paying the same, though.
In Glasgow a house which in 1920 was rented for £20, in 1962 has a rent of £15 11s. 8d. In the County of Dunbarton, another urban county in the South of Scotland, a rent of £20 in 1920 has become a rent of £10 7s. 6d. this year.
The tenant is paying the same
Obviously there has been a material change in the costs met by landlords in the interval. I cannot give an up-to-date figure of the cost of repairs, but a committee reported in 1953 that at that time the cost of repairs had risen by 216 per cent. since 1939, and certainly the cost of repairs has risen since then. The effect of that is that unless a landlord is prepared to produce money out of his own pocket, which many of them have done, he cannot keep his house in proper repair out of the rent. A great many houses in Scotland, as hon. Members on both sides of the House are aware, have become seriously dilapidated and there are still a great many houses in Scotland which are basically perfectly good houses and capable of improvement.
They have been dilapidated for the past thirty years.
I do not suggest that all the privately-owned houses in Scotland are good and that all privately-owned houses would have been kept in a proper condition if a proper rent structure had been set up in 1957, but hon. Members will understand the magnitude of this problem in Scotland when I mention that at the time of the Rent Act in 1957 there were estimated to be no fewer than 600,000 houses in control in Scotland, and the estimated figure today is now fewer than 450,000 houses, which is a vast slice of the housing accommodation in Scotland and housing now no fewer than one-third of the population. Therefore, this is a matter of extreme importance.
As year follows year these houses are running the risk of further dilapidation, and it is for that reason that I have introduced this Clause. In doing so I have followed a very good precedent. In the debate on the Rent Act in 1957 this point was discussed in the House. My right hon. Friend the Secretary of State, speaking in the Third Reading debate in March, 1957, said:Since 1957 a good many things have happened. There has been a complete revaluation of all heritable property, including house property, in Scotland. The change to which my right hon. Friend the Secretary of State referred in his speech in 1957 has taken place. This revaluation has taken place and the Government are now in a position to consider the effects of these revaluations and produce a completely new rent structure for controlled houses in Soot-land in the same way as took place in England in 1957."These rent provisions are, as I have said, of an interim nature and the Government do not look on them as representing a new rent structure for houses remaining in control. It will be necessary, once the new valuations become available in 1961, to make a fresh and comprehensive review of the position as a whole."—[OFFICIAL REPORT, 28th March. 1957 Vol. 567. c. 1421.]
Is the hon. Gentleman suggesting that if the rents of privately-owned houses were increased to the gross rateable value, all the necessary repairs and alterations, including the installation of inside lavatories, running water, hot water systems and so on, would be provided?
The hon. Member knows the powers and duties of local authorities as well as any other hon. Member, and he can make up his own mind about that himself. The fact is that thousands of basically sound houses in Scotland have become dilapidated because the controlled rents are insufficient to meet the cost of repair, and many more will be lost unless these steps are taken. Hon. Members know that very well.
That is sheer nonsense.
I agree that this matter may cause the Government a little embarrassment. I shall try to satisfy my hon. Friend the Under-Secretary that he need have no embarrassment at all. Just before the last election the then Minister of Housing and Local Government in England made a statement at a Press conference, when he said that the Government would not remove any houses from rent control. As I took care to point out at the beginning of my speech, this Clause has not that effect and no house will be taken out of control as a result of it.
The second point which might embarrass my right hon. Friend is that the then Minister of Housing and local Government subsequently said, outside this House, that no alteration would be made in rent levels during the lifetime of this Parliament. By that I take him to mean that he would make no alteration in the level of rents at which houses were controlled or decontrolled, which in Scotland at the moment stands at £40. I am not seeking to make any alteration in that at all. I would remind hon. Members of the provisions of Section 11 (3) of the Rent Act, 1957, which gives power to my right hon. Friend the Secretary of State by order to remove houses from control. I suggest to my hon. Friend that what the Government spokesman meant at that time, if indeed he meant anything at all, was that no steps would be taken under Section 11 (3) to bring houses out of control by altering the rent level by which they remained in control. If the Government give effect to this, they will, in my opinion, be quite consistent with their pledge. I have taken even greater care to make sure that the Government need have no embarrassment about this. I have in my new Clause tried in no way to fix what level of rent would be appropriate for these houses. What I seek to do is to give powers to the Secretary of State at such time as he thinks fit to make a new rent structure. It may be that he is not yet ready to do that because I understand that in some parts of Scotland revaluation has not been completed. If he finds any difficulty on that score, he need not be worried, because the new Clause gives him discretion to impose this rent structure as and when he thinks fit, which may not be in the course of the present Parliament, although I hope that it will be.Does that mean that the Clause bears no relation to the amount of the gross annual value? Is it merely words, or does it mean that it is an argument to try to bring parity between the practice in regard to council houses and the practice in houses of this kind? What is the purpose of it?
It means that the Secretary of State, in considering this matter, has merely to use the annual value as a sort of yardstick. It might be higher than the level in use or it might be lower. To illustrate that, in England the Minister used the gross annual value as the yardstick of rents but he did not use it simplicitá, because it was fixed immediately after the war and things had changed. In England, at the moment, I understand that the level of rents of controlled houses is not the gross annual value, but twice the gross annual value, which shows that that is merely a measure which might be used for the purpose of settling things at some time in the future.
Would the hon. Gentleman tell us what is twice the gross annual value in England? What is the figure—is it £20?
If I were to answer that question, I should be completely out of order, in discussing rents in England. I am discussing the situation in Scotland. We are trying to give the Secretary of State power to remedy this situation in which we find ourselves in Scotland.
I have spoken at considerable length. [HON. MEMBERS: "Hear, hear."] No doubt, I have spoken very much longer than hon. Members opposite would have liked, but I feel that I must remind the House of the extraordinary situation of these houses in Scotland. An example of 1962 rents for a three apartment controlled house with all modern conveniences—kitchenette, bathroom, hot and cold water and all the rest—in the City of Glasgow is 9s. a week. The average figure for a similar house in Dumbarton is only 6s. a week. That is rather less than the 1920 rents for the same houses, which is a completely fantastic situation.May I ask the hon. Member where he got his figures? Did the Factors and Property Owners Association supply them?
8.15 p.m.
I got the figures from the organisation to which the hon. Gentleman refers which, of course, is an organisation which has made a study of these matters. If any hon. Gentlemen opposite are in doubt about the veracity of the figures, I will read, in conclusion, parts of a letter which I received last year from a lady in my constituency. This lady, who is elderly and has very slender means, told me that she bought a house, a double villa, which consists of two semi-detached houses each containing three apartments, with bathroom and kitchenette. One of these houses was let under controlled tenancy and at the time she bought it the controlled rent was £13 per annum. In 1957, under the new Act, she was allowed to increase the rent by 25 per cent., making the present rent £16 5s.
She could have increased it considerably more—by 50 per cent.—if she had been able to show that she had been doing the repairs.
I am reading from the lady's letter—[Interruption.] If hon. Members opposite want me to carry on longer I am willing to do so.
Having got her rent to £16 5s. she then had to deduct from it no less than £5 7s. 3d. in respect of owner's rates, leaving her with a net rent for that house of £10 17s. 9d. That was not slum property. It was a stone-built house kept in first-class repair which that lady has had to pay for out of her own pocket.On the point of owner's rates, which in this case amount to about £6, will he not agree that that is a much better bargain now than it was previously when individual house owners had to pay for the services of the fire brigade, which is now paid for by the general body of ratepayers? They now get these services free and the cost is carried by the rest of the ratepayers.
I suggest to the hon. Gentleman that if he can get a three-apartment, stone built house, with a kitchenette and bathroom, for £10 17s. 9d. a year, or 4s. 2d. a week, it is a mighty good bargain. There is the situation. The present gross annual value of that house on revaluation is £29. Obviously that it what the county assessor considers to be the proper rent of that house and all that this lady is entitled to charge is £10 17s. 9d., or 4s. 2d. a week. She concludes her letter with these pathetic words:
That is what I am asking the House to give the Secretary of State power to remedy. It is with the greatest confidence that I commend the new Clause to the House."I am sure you, with your sense of justice, will be able to help those poor small house owners who need help so badly. I am (a greedy grasping landlord). Yours respectfully, Miss Anton."
This is a disgraceful Clause, and we have just listened to a disgraceful speech. The hon. Member for Aberdeenshire, West (Mr. Hendry) has taken half-an-hour of the time allotted to consider this Bill to discuss a matter which does not come even within the Long Title of the Bill. He has made abundantly clear that he sees the purpose of this Bill is to enable there to be an indefinite continuation of the right of private enterprise landlords to draw rents for houses which they own and which have been occupied for the past hundred years. By this Clause the hon. Gentleman is asking that rents for these hundred-year-old houses which are less than the gross annual value, as determined by the assessor, shall be raised to that figure or that at least the new rent shall have a relationship to the valuation.
Is this done in the interests of equity? Does the hon. Gentleman have in mind that the figure determined by the assessor should be the figure of rent to be paid by all who occupy private enterprise rented houses in Scotland? Not at all. As the hon. Gentleman has said, there are about 450,000 controlled houses in Scotland. There are about 150,000 houses that were taken out of control by the provisions of the 1957 Act, and houses are coming out of control with every week that passes. In every case the rent charged after control ceases greatly exceeds the amount laid down by the county or city assessor. In the interests of equity, did the hon. Gentleman suggest that rent should be brought back to the amount determined by the assessor? In reaching this gross annual value the hon. Gentleman was determining what he regarded as a fair rent. But it is suggested in the interests of equity that the assessor should determine a figure which would be made applicable in the case of those 150,000 houses taken out of control since 1957? Not at all? The hon. Gentleman did not move this Clause in the interests of equity, but in the interests of the landlords. And I am not sure that he should not have declared his own interest. The vast majority of those 450,000 controlled houses in Scotland were built before 1880. The vast majority of them are one- and two-apartment houses with no amenities at all. With no hot and cold water supply, no bathroom and no kitchen. The vast majority of the tenants have to share a toilet with several other tenants. Thirty years ago a Royal Commission said that the owners of those houses regarded them as a dripping roast that would go on dripping for ever. In the intervening thirty years most of the landlords have not spent any money at all on keeping those houses in a decent state of repair. The hon. Gentleman regrets very much that the net income from those houses is less today than forty-two years ago when the 1920 Act was put on the Statute Book. Those houses have earned more and more money during those years and in most cases no money has been spent upon them to keep them in an adequate state of repair. Every decent-thinking Scot wishes to see most of those 450,000 houses, which the hon. Gentleman himself said were dilapidated, pulled down and replaced by decent houses for our people. The hon. Gentleman knows perfectly well that this Bill is not calculated to increase the supply of houses by a single house a year. The net effect of its provisions will be to reduce the number of new houses built in Scotland to replace those which are 80, 90, 100 and 110 years old, the sort of houses occupied by many of our fellow citizens. The hon. Gentleman knows full well that about one-fifth or more of the population—about one-third—live in houses privately owned and rented. He recognises that nearly one-third are living in houses still rented. The number is a little less than one-third but more than one-quarter. The hon. Gentleman knows that more than one-fifth of our fellow citizens are living in the sort of houses which I have described, with no amenities at all. In the main it is in respect of that type of house that the acceptance of the hon. Gentleman's Clause would result in there being a little more "lolly" few the landlord. I do not know why even the hon. Gentleman was not ashamed of himself as he moved this new Clause. I sincerely hope that the Under-Secretary will reject it. If he does not, he will show that the Government have shed the last remnants of decency that reside on the benches opposite.Sir Colin Thornton-Kemsley.
On a point of order, Mr. Deputy-Speaker. I understand that the question has been raised with you before, but we are working under a timetable Motion and the hon. Member for Aberdeenshire, West (Mr. Hendry) took, I understand, about twenty-four minutes of our precious time in moving this Motion. I hope that the Minister will deal with the matter at once, but if not I wish to move, That the Question be now put. There are other matters of immense importance which we shall not be able to discuss and which could not be discussed during the Committee stage because of the imposition of a Guillotine, which was supported by the hon. Member for Aberdeenshire, West.
I am sorry, but I must tell the hon. Lady that that is not a point of order. I have called the hon. Member for North Angus and Mearns (Sir C. Thornton-Kemsley). I hope that the hon. Member will be brief.
I have—
The hon. Member should declare his interest.
—not had an opportunity to speak because I was not a member of the Standing Committee which considered the Bill for reasons that were beyond my control. I have a speech which I can make if I am provoked by hon. Members opposite. In view of the fact that I know the House wishes to pass on to other matters of importance I will take the minimum amount of time. But I must ask for the courtesy of an opportunity to say that I think that the hon. Member for Hamilton (Mr. T. Fraser) did not put the whole picture before the House.
When we referred to controlled houses we were speaking of the homes of one-third of the people of Scotland. Although many of these houses are old, and I agree with the hon. Member when he says that many should be swept away and that decent Scotsmen would like to see them pulled down, in fairness, I must say that quite a number are decent flats in the cities and have all the amenities. They are not bad houses and they are eagerly sought after by tenants.
How many?
I am not going into a lot of detail. Obviously if I am driven into giving a lot of detail I cannot make my speech short. We must face realities. Whether we want to or not, we cannot sweep all those houses away at once and replace them by new ones. What, therefore, should we do? They are all under controlled rents. I make no apology for speaking on behalf of Scottish landlords because I think they have had the muddy end of the stick over this matter. Scottish owners of housing property have long suffered under the grievance that because of the impact of owners' rates with which we have now done away—
They get protection for the rates.
8.30 p.m.
Every increase from 1940 onwards was eaten into by the ever-increasing owners' rates so that there was an insufficient rental income to provide for repairs of these houses.
What my hon. Friend the Member for Aberdeenshire, West (Mr. Hendry) wants is to see that in those cases where there are still houses subject to the control under the Rent Act the rental income shall be sufficient to allow for repairs to the property and to see that they are properly maintained. He does not suggest what the rental should be, but simply that it should be fixed in relation to the gross annual value. That seems a sensible proposal. My right hon. Friend would not be precluded from bringing that into operation by any pledge which was given at the time of the last election because they were not relevant to the circumstances. Before closing my speech, I wish to deal with the only one which, I admit, gave me a great deal of thought. The pledge was made in these terms by the then Minister of Housing and Local Government—the present Chief Secretary to the Treasury. At a Press conference on 30th September, 1959, he said that the Government did not in the next Parliament intend to alter the rent levels laid down in the Rent Act. There are no rent levels laid down in the Rent Act other than the rent levels laid down in Section 11 (3) of the 1957 Act which says that the controlled rents shall cease to be controlled if the value rises above £40 in Scotland or the Metropolitan police district of London or £30 in England and Wales.What about repairs? Did they not get money then?
That is not covered by this pledge.
But we know they got it.
The hon. Member for Glasgow, Central (Mr. McInnes) is not usually so far off the mark. I was not talking about the increases allowed under the Act. Those increases were admittedly 25 per cent. or 50 per cent. subject to certain qualifications, but they had been siphoned away by the incidence of owners' rates in excess rents. I am sure that my right hon. Friend is not precluded by any pledge that has been given not to introduce this sort of thing. I think this would be a wise measure in the interests of the tenants of owners of controlled houses in Scotland.
I was interested in the speech of the hon. Member for Hamilton (Mr. T. Fraser). I was glad that we had him back with us again. I think that while he has been away he must have got up a lot of steam because I thought he was a little unfair to my hon. Friend the Member for Aberdeenshire, West (Mr. Hendry) who moved the Second Reading of this new Clause.
The effect of the new Clause would be to empower the Secretary of State by order to fix the rents of controlled houses, despite the terms of the tenancies or of the Rent Acts, by reference to the gross annual value. This proposed new Clause seems to be outside the Long Title of the Bill—[HON. MEMBERS: "It is."] I know that my hon. Friend has put down an Amendment seeking to extend the Title sufficiently to cover this Clause, but I must say to him that the contents of the Clause seem rather to belong to the Rent Acts than to the Housing Acts. It is not, therefore, entirely appropriate to the present Bill. For this reason alone I should be reluctant to accept it in the present Bill. In addition, however, the Government have already made clear that they do not intend in the present Parliament to alter the rent levels laid down in the Rent Act. Although my hon. Friend the Member for North Angus and Mearns (Sir C. Thornton-Kemsley) was able to satisfy himself that this new Clause would not do that, I am afraid that neither I nor my right hon. Friend has been able to satisfy himself. In our view this new Clause would cut right across that undertaking. That is another reason for not accepting it. I am sure that my hon. Friend would appreciate that it would be wrong for us not to keep our word. [Laughter.] I do not understand why hon. Members opposite laugh—If the hon. Gentleman does not understand, may I remind him that in the General Election his party promised not to introduce a Bill to amend the Rent Act. What was the 1957 Bill but a Bill to amend the Rent Act?
I think the hon. Member has got it wrong. What we said was that we would not introduce a Bill, but we would review the position. Here we are seeking to keep our word, and we regard ourselves as bound by what the Chief Secretary said. When the 1957 Act was passing through Parliament my right hon. Friend the Secretary of State made it clear that he regarded the Scottish Clauses as being of an interim nature pending the 1961 revaluation. He indicated that it would be necessary
"once the new values become available in 1961 to make a fresh and comprehensive review of the position as a whole."—[OFFICIAL REPORT, 28th March, 1957: Vol. 567. c. 1421.]
A confidence trick.
It was no confidence trick. The Secretary of State's remarks in that year did not imply any undertaking that legislation to review the Rent Act would be introduced immediately the new values were available. Quite apart from the Government's pledge not to alter rent levels in the present Parliament, the collection of the necessary information about the gross values and the rents of controlled houses would be a major operation, and for this reason, if for no other, the early introduction of fresh rent control legislation would clearly be impracticable.
I am not entirely unsympathetic towards my hon. Friend's case, and my right hon. Friend has it very much in mind, but at the moment I regret that I cannot accept his proposal. I hope that, in the light of the three reasons which I have given, he will feel disposed to withdraw the new Clause.Question put and negatived.