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Volume 930: debated on Wednesday 20 April 1977

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Rating System


asked the Secretary of State for the Environment what plans he now has for reforming the rating system.

The improvement of the rating system is one of the matters that I am considering in the light of the report of the Layfield Committee of Inquiry into Local Government Finance. The Government's conclusions will be announced in due course.

Does the Secretary of State agree that, given our continuing high rate of inflation and the considerable redistribution of income that has been brought about in recent years, the time is now right to move to a system that is more geared to people's ability to pay?

I am very much aware of the criticisms that have been made in all parts of the House about the domestic rating system. If I understood the hon. Member's remark correctly, this matter was very exhaustively considered in the Layfield Report, and the conclusions drawn by Layfield were that, whatever changes were made, the domestic rating system could not be, as it were, abolished. That view is shared by people throughout the country, except Members on the Opposition Front Bench.

Does my right hon. Friend agree that the reform of local government finance should have taken place before the reform of boundaries? Does he feel that the time is now opportune to give back to the towns and cities the powers that they lost as a result of the reorganisation?

My hon. Friend raised a very important question, but it is separate from the question of the reform of local government finance. The question of the structure of local government and the distribution of powers between the two tiers is one that should have, and deserves to have, continued study.

Is the Secretary of State aware that the present rating system is causing tremendous hardship to a large proportion of ratepayers—particularly elderly persons—and to small businesses? We seem to have been discussing reform for a long time. Will he expedite some proposals and let us know when he is coming forward with them?

I hope to report to the House in the next few weeks the conclusions that the Government have reached. Then the House will have ample time to discuss what we are proposing. However, I must point out that, in spite of the harshness with which the rates bear on people, it is true that about one-third of the ratepayers—certainly very many retired people—are in receipt of rate rebates, which are a great help.

It is right that we should take time to get the rating system right, but does my right hon. Friend agree that there are some grievous anomalies in the way in which the rate support grant works? Has my right hon. Friend reviewed the working of the rate support grant this year, and can he offer help to counties like Cambridgeshire, which suffered badly in the last round?

Always, under any system, there are anomalies. To some extent these result from the unpredictable effects of the particular rate support grant formula adopted. We are now considering the proper formula for 1978–79 and I am trying to take account of the many difficulties and criticisms that have been expressed in all parts of the House during the last 12 months.

Derelict Land


asked the Secretary of State for the Environment if he will order an inquiry into vacant or derelict land held by local authorities.

I could not justify asking authorities to carry out such a costly inquiry at this stage.

Is it not in the interests of the inner cities that rehabilitation of such spoiled sites should be developed first rather than that we should follow the deplorable advice contained in the circular to local authorities on the Community Land Act just before Christmas? This advice encouraged the taking of more green field sites and the losing of more good agricultural land.

I agree that it is very much in the interests of inner cities that local authorities should deal with spoiled sites, and the Government are always encouraging them to do just that under the provisions of the Community Land Act. I would not interpret the advice given about the Community Land Act in the circular as encouraging local authorities to use green field sites. We have encouraged them, when they acquire land under the Act, to do so only in circumstances in which it can be quickly and reasonably disposed of.

Does my hon. Friend agree that there should be an inquiry into the location of areas such as used quarries and mines, which can receive waste from derelict sites? There is an urgent need to locate these areas.

I shall bear that point in mind, but it is primarily a matter for the county authorities.

Is the Minister aware of the concern that has been expressed about the loss of agricultural land by reason of its use for non-agricultural purposes? Will he assure the House that the Government see it as a priority that derelict sites should be used first for industrial purposes, rather than that good agricultural land should be used?

I take the point. The hon. Gentleman will be aware that the White Paper "Food from Our Own Resources" deals with that precise point.

Is the Minister aware that his first reply was most unsatisfactory because in Liverpool, for example, 800 acres of land are in public ownership and cannot be used for the purposes originally specified, and that Manchester has some 230 acres and Newcastle 150 acres as the start of a catalogue of land in that category? Is it not a fact that this information should be collated and also that authorities should be encouraged to dispose of unused assets at residual value to ensure needed development and the release of capital from such resources which could be brought back into the public kitty?

I shall not attempt to deal with the hon. Gentleman's catalogue of complaints. He may believe that it is desirable to collate this information. I certainly agree that there is a need to deal with land holdings. Local authorities have had some difficulty, because in some cases, as a result of reorganisation, they have inherited inadequate records. We have encouraged them to get ahead with that task as far as possible, but on the question of collating information I must tell the hon. Gentleman that we are unwilling to put local authorities to considerable expense. I recognise the importance of derelict sites in inner cities, and we shall address ourselves to that subject in a White Paper, which will shortly be published. Indeed, this matter was also one of the subjects of my right hon. Friend's recent statement.

Essex County Council (Expenditure And Rates)


asked the Secretary of State for the Environment if he will discuss with the Essex County Council the effect of Government policies on local government expenditure and rates.

I am aware of the problems facing the county as a result of discussions at official level. However, decisions about priorities for expenditure are for the county council to take.

Is the Minister aware that, apart from a continuing sense of grievance by many at being penalised for heeding the Government's call for economies last year, there is a strong feeling that not enough account has been taken of the problems created by an expanding population, and one that is still expanding? Will he assure the House that these factors will be taken into account in considering the formula for next year's settlement?

I do not agree with the hon. Gentleman that Essex has been penalised in this respect. This matter has nothing to do with the assessment of the rate support grant needs element; it is a question of the degree to which authorities keep within certain guidelines. It has a great deal to do with the assessment of spending need rather than with the question of spending alone. We shall take into account any points that the hon. Gentleman or the county wishes to raise. There is little evidence to suggest that the growing population and its needs necessarily implies a requirement to spend more per head of population. That, perhaps, is one reason why Essex may feel a sense of grievance.

Will my hon. Friend make it clear that the Labour Government do not support all the vicious cuts imposed by the Essex County Council, particularly in education, where capitation allowances, the heating of swimming pools and the staffing in schools examinations, fees, and all the rest of it have suffered? Is he aware that the Labour group of the Essex County Council has been voted down in efforts to try to maintain some of these services for the public?

It would be wrong of me to comment on the points that my hon. Friend has rightly put to the House—[Interruption.] It is right that the electors in Essex should make their comments in the elections.

Inner City Development (London)


asked the Secretary of State for the Environment if he will make a further statement on his plans for inner city development in London.


asked the Secretary of State for the Environment what further plans he has for new development in dockland; and if he will make a statement.


asked the Secretary of State for the Environment if he will make a further statement on his plans for inner city development in London.

Following my statement on 6th April, I shall be consulting the GLC, the Docklands Joint Committee and other authorities concerned in London with a view to setting up partnership arrangements as early as possible.

I welcome part of that statement by the Minister, but will he clarify further his philosophy? Does he agree that relief in inner areas of excessively bad housing and multiple deprivation should not be given at the expense of outer urban areas and areas that, in total numbers of units, are above average in terms of bad housing in any case?

Because of the unity of London as a housing area and because the area faces great housing problems, we made the whole of London a housing stress area so that we should not interfere with London's building programme. However, there are in London an enormous variety of conditions. In particular inner areas we have identified multiple problems of a kind familiar to most hon. Members who know these areas well. They require special arrangements, and we hope that much good will arise from partnership agreements.

To relieve the housing shortage in inner London areas, what action does the Minister intend to take to put pressure on the Greater London Council to build a substantial quantity of new housing in dockland, which, so far, it has dismally failed to do?

I am amazed that the hon. Gentleman should make those comments. There are substantial proposals for house building in the dockland areas, and I am glad to say that some are now going forward. The GLC, as a strategic housing authority, has tried to deal with the needs of London as a whole. It is right that the commuter boroughs as well as the inner boroughs should make arrangements to help deal with London's pressing housing problems.

Is my hon. Friend aware that, despite what has been said by the hon. Member for Twickenham (Mr. Jessel), the Dockland Joint Committee has said that over 1,000 houses are now being built in the dockland statutory area? What proportion of the allocation announced before the recess will be available to dockland?

I cannot give an answer on the second part of my hon. Friend's question, but I hope to be able to make the allocation plain in the White Paper—not only dockland's share of the additional expenditure of £83 million announced by my hon. Friend the Chancellor of the Exchequer in the Budget, but also the share of other partnership areas. We may be able to indicate also the allocations among the different partnership areas in the longer-term programme, to which my statement of 6th April was directed. I endorse what was said by my hon. Friend the Member for Newham, South (Mr. Spearing) about the number of houses that have already been built in dockland by local authorities. There is evidence of considerable encouragement in terms of progress made.

Will the Minister turn his attention to the subject of unemployment in inner London? May I ask whether he is aware that in the borough of Lambeth more than 11,000 people were unemployed in October last year—an increase of 44 per cent. compared to the same month of the previous year? Of this total, 681 comprised young persons, and of these does he not appreciate that over half are school leavers who left school some five months before? What are the right hon. Gentleman's plans to remedy the situation?

I am sure that the House will welcome the expression of concern about unemployment in the inner areas. As the hon. Gentleman well knows, Lambeth is one of the areas that we have identified for partnership arrangements. I can conclude from what the hon. Gentleman has said that my proposals are welcome to him and to the borough of Lambeth.

Will my right hon. Friend bear in mind the necessity of trying to get the building societies to co-operate in the regeneration of inner areas such as Lambeth? Is he aware, for example, that the building societies have refused a staggering 59 per cent. of council nominees in Lambeth compared with much lower figures in outer areas?

I am sure that the societies have an important part to play in helping the revival of the inner areas. As my hon. Friend will know, we are now commencing the new arrangements with the building societies—they having begun in April of this year—under which sums of building society replacement lending moneys have been allocated to the major local authorities. It is my intention to watch closely how the arrangements work out.

Will the right hon. Gentleman postpone his discussions on partnership plans until after 5th May, as he may find that any deals that he does with a dying administration may turn out in the end to be just as bad as the Lib-Lab deal that is keeping him in power at the moment?

I wondered when the imminence of the county council elections would be reflected in contributions from the Opposition Front Bench. Although I am not an avid student of Conservative Party literature, I have on the whole been rather encouraged by the expressions of concern for the inner areas, including the partnership areas, that have come from the Opposition benches in County Hall. I hope that I may proceed in the knowledge that whatever I do will have the full backing of all the parties concerned.



asked the Secretary of State for the Environment if he will visit Camden for the purpose of discussing local government expenditure.

He has at present no plans to do so.

When the right hon. Gentleman or his ministerial colleagues visit the People's Republic of Camden, will they tell the local authority that to build 42 houses at a cost rent of £160 each per week is financial lunacy and of no help to the ratepayers or taxpayers?

I have no doubt that the hon. Gentleman and his predecessors, with their long association with the authority, have made their views well known. As for high costs generally, and without particular reference to the scheme that the hon. Gentleman probably has in mind, it must be fairly stated that there are special problems in Camden and a number of other inner city areas. There are special problems involving the high cost of land and the high cost of servicing land. However, I assure the hon. Gentleman and the House—I have made this clear to Camden and other authorities—that we shall be closely watching the unit cost of housing construction, housing conversions and modernisations. These matters must be treated with fairness. We need the dwellings that are provided. In some areas costs are much higher than those elsewhere.

It is difficult in Question Time to give a list, chapter and verse, of all the contacts that exist between my officials and myself and local authorities with special problems of high costs. If the hon. Gentleman has a particular problem in mind, I can assure him that he may unburden himself to me either by Question or by letter.

Empty Houses (Public Authorities)


asked the Secretary of State for the Environment if he will institute an inquiry to determine the extent to which rented housing owned by Government Departments, nationalised industries, public authorities and local authorities is standing empty and is likely to remain empty for more than a matter of weeks.

I do not think that a survey of one sector would be appropriate. I am commissioning a sample survey of vacant dwellings to be undertaken later this year. This will look at causes and at the length of time dwellings remain empty.

In view of the scarcity of available resources, does the right hon. Gentleman accept that it would be desirable to offer on advantageous terms to first-time house buyers properties that are not occupied but under some degree of public ownership, that being a better use of resources and of advantage to those who wish to purchase their own homes?

No, I do not accept that as a general proposition. Much more importantly, I wish to see local authorities and housing associations that are involved in the purchasing of properties on the market and in acquisition programmes seeking to implement their programmes of modernisation and improvement more rapidly and economically—I know, for example, that many local authorities are doing so—so that the dwellings may be more quickly occupied. In that general context there may be particular situations in which dwellings can be made available to first-time buyers or other buyers down-market. I wish to encourage local authorities along those lines, and a number of them are so acting. I visited Newcastle quite recently. The authority there is one of those which are taking precisely that course. Other authorities are doing so as well.

Will my right hon. Friend give me an assurance that the random sample will include houses bought up by his own Department in anticipation of the building of motorways that are subsequently cancelled? Will he consider giving instructions to those responsible in his Department that in such circumstances they should not automatically vandalise the properties at the start of these exercises but should make them safe, in case there is a change of mind later?

The sample to which I have referred will cover all sorts of property—for example, Government-owned property, local authority-owned property and privately-owned property. I do not accept that it is the policy of my Department, or possibly the Department of Transport—in earlier times part of the Department of the Environment—to vandalise properties that have been purchased ahead of proposed road schemes. If my hon. Friend has a particular problem in mind I shall look into it if he cares to put it to me, or I shall ask my right hon. Friend the Secretary of State for Transport to do so. It is the policy and practice of Government Departments to make properties that are the subject of deferred demolition available to local authorities and others for occupation as rapidly as possible. I look into complaints as much as I possibly can.

Will the right hon. Gentleman give the House an assurance that the survey will take place in midwinter? If it does not take place at that time the scandal of second homes and summer lets in Cornwall will not be shown up.

I cannot undertake that the survey will be pursued in the midwinter. Although I recognise that there are local problems in some parts of the country, I do not think that the hon. Gentleman's point is entirely relevant to empty properties. Whatever our views may be about second homes in various parts of the country, second homes are available for occupation by the owners or by tenants to whom the owners may wish to let.

Is the right hon. Gentleman aware that 18 months ago in reply to me he said that he hoped to have information on this situation? Why does it take so long for the Department to obtain adequate information on a problem that everyone else has been aware of for a long time? Why does the right hon. Gentleman's Department seem to be the last in the line to react to a situation that has been of concern to so many people for such a long time?

I do not know to which Question the hon. Gentleman refers but I am aware that we undertake an annual relet survey of local authority properties and receive sample information. That information is statistical and does not give the reasons, which is what the survey that I have announced will do. The returns from the relet survey provide basic information. They do not provide the reasons, but make known the existence of unlet properties. The unlet property in the local authority sector is proportionally much smaller than in the private sector.

Urban Problems


asked the Secretary of State for the Environment if he will make a statement explaining the criteria by which Government funds are available for combating urban malaise.


asked the Secretary of State for the Environment what is the Government's policy towards alleviating urban problems in major conurbations.

We are proposing to give a large measure of priority in the next few years to the regeneration of the inner areas of the major cities. Other cities and towns will have access to urban grants, I hope on an increasing scale, in later years. It is our intention to offer partnerships to five areas initially. We will consider proposals from other authorities with major inner area problems.

Is the right hon. Gentleman aware that references to the question of criteria seem to have been missed out in the answer? Is he aware that community development requires community involvement? Will the right hon. Gentleman make one criterion for specific spending plans the involvement and participation of the local community?

I am very much in favour of community involvement, but how, in each case, the community, in all its many different forms of activity and representation, can best be drawn in depends upon the discussions that we have with the partnership authorities. The particular arrangements must depend upon the views of community representation and our discussions. As for the answer not dealing with the criteria, I referred, of course, to areas that have a particular and special degree and scale of problem. It is to those areas that we are, as it were, giving our first attention. I think that the hon. Gentleman will recognise that in the areas that we have already identified there is a mixture of problems—high unemployment, rapid loss of population, an unbalanced residual population, and large-scale environmental dereliction all being present.

Is the Secretary of State aware that following the expectations raised by his speech at Bristol his recent statement to the House, though welcomed as a recognition of the problems, came as a disappointment to hon. Members on both sides of the House because of its many inadequacies? Will he tell us precisely when the White Paper will be published, in order that these matters may be debated in more detail?

This is a matter of subjective impression. I was not aware of the universal disappointment to which the hon. Gentleman referred, other than as expressed by him from the Opposition Front Bench. I welcome the Opposition's view that I am not spending enough on the problems of the inner areas. If they are to go on encouraging me to increase the resources available to help solve the problems of our inner areas, they will find me a most attentive listener and very easy to persuade.

I hope to publish the White Paper within the next few weeks.

Is my hon. Friend aware of the deep resentment felt in Newcastle upon Tyne at the exclusion of Newcastle from his inner city partnerships? Is he further aware that on any reasonable set of criteria Newcastle surely must come up to scratch compared with areas which were offered partnerships? Will he, as a matter of urgency, meet a deputation from the Newcastle City Council to talk to him about it and the possibility of including Newcastle in the partnership arrangements?

I am aware of the feelings in Newcastle and, indeed, other cities which have not so far been identified as partnership cities. I have not excluded Newcastle, because I have announced a provisional list. I assure my hon. Friend that I am willing to receive representatives of the Newcastle City Council to consider its case.

Is not the principal urban malaise in this question the fact that over 100,000 people are leaving London every year? Would it not be better to encourage industry to return to London than to encourage three of the London boroughs to persuade some of their residents to move to Crawley in my constituency, where there is an expanding population and the housing programme has been cut?

I am anxious to encourage appropriate industry to return to London and, in particular, to prevent the continued erosion and job loss in the central and inner areas of our capital city. Indeed, a number of the comments that I made in my statement were designed to bring that about.

Will the Secretary of State tell the Chancellor, whose deficit is £2½ billion less than we were told four months ago, that one vital way to help would be to restore the cuts in the amounts that local authorities can spend on buying and improving old houses and in the amounts that they can lend to would-be house purchasers who will not be comforted by building society mortgages?

I assure my hon. Friend that as and when additional resources come forward we shall consider very carefully the priorities for additional expenditure.

In view of the Secretary of State's jibe concerning public expenditure and the finding of resources to resuscitate inner city areas, may I ask why it is that, for the third or fourth time of asking, he has not answered the question that I have put to him previously, namely, the disposal of commercial and industrial properties in new towns in order to release public capital, which has done its job, for reinvestment in inner city areas?

The answer is perfectly simple. I am giving the hon. Gentleman the courtesy of actually considering what he said. It is one of a number of suggestions that are certainly worth study, and I am studying them. I am concerned to find resources to increase public expenditure in areas of greatest need. I welcome this new universal, across-the-Floor approach to the priorities of public expenditure.



asked the Secretary of State for the Environment for what purposes the Government are planning to make available extra resources to combat urban blight in Liverpool.


asked the Secretary of State for the Environment if he will make a statement on what special steps the Government plan to take to combat urban decline on Merseyside.

As my right hon. Friend announced on 6th April, the Government intend to offer a special partnership to the local authorities for Liverpool. This will involve the joint preparation of an inner area programme. Urban grants will be related to the new programmes and will extend to economic, environmental and social projects. Merseyside generally should benefit from the new priority given to inner areas in the main policies and programmes of Government and from steps taken to strengthen the economies of these areas.

Will the Minister tell the House what is the point of withdrawing many millions of pounds from Liverpool in the shape of improvement grants, home loans, urban aid programmes and community development projects and making such a song and dance about it now that he is returning a bit of it?

I believe that the hon. Gentleman made this point when my right hon. Friend made his statement. I do not recognise the figure that he then quoted or the many millions of pounds about which he talks now. House building in Liverpool has not been cut, Section 105 has not been cut, and virement is possible between different programmes at present. If the hon. Gentleman cares to write to me explaining the details that he has in mind, I shall look into them.

Is the Minister considering the representations of the metropolitan borough of Wirral about the serious problems of inner area deprivation in Birkenhead and Wallasey? Will he give them serious and sympathetic consideration? Will he also explain whether the comprehensive community programme will do anything to help the serious problems in Wirral?

I have not yet seen the representations made from that part of the country, but I shall look at them with great interest when they come. I shall certainly consider them sympathetically. I repeat what my right hon. Friend said about partnership arrangements. The money available has to be concentrated on areas of highest priority. That does not mean that the urban programme, which is being transferred from the Home Office to my Department, will not be made available to other authorities throughout the country. In fact, the money available is being enhanced. Furthermore, we shall want to see comprehensive community programmes more carefully worked out in allocating money from the urban programme.

Whilst in no way wishing to deprecate the problems of places such as Liverpool, may I ask my hon. Friend whether he accepts that other urban areas, such as Kirkby, have employment and housing problems which are just as serious? Following the visit of my right hon. Friend the Minister for Housing and Construction, will the Minister consider sympathetically and carefully the housing problems of Kirkby, which, although a matter for the local authority, cannot be solved without a massive injection of Government money?

I know that my right lion Friend the Minister for Housing and Construction is actively considering Kirkby's housing problems. The fact that the Government have identified the priorities of the partnership cities does not mean that they have ignored or neglected the problems of other areas. Large sums of money go to other authorities through normal programmes. We hope that the country generally and local authorities will begin to recognise, as the Government have, the priorities of inner city problems, including dereliction.

Will my hon. Friend indicate when there will be a meeting between his Department and the local authorities? Is he aware that among all intelligent people on Merseyside there is general support for and acceptance of what the Government are doing in relation to this matter, but that the policy must now be translated into action? Does my hon. Friend realise that the quicker a meeting is held between the Government and local authorities to work out plans and to get something done, the more that will be warmly welcomed on Merseyside?

Obviously, I cannot give a date for a meeting, but I can give the assurance that a meeting will be held as soon as possible. The Government recognise the degree of urgency to which my hon. Friend has drawn attention.

Is my hon. Friend aware of the obvious relationship between public building and unemployment among construction workers? Does he realise that 50 per cent. of the total of unemployed construction workers in the North-West Region are in the Merseyside and Liverpool travel-to-work area? In that sense, do the Government not feel the urgency of getting moving on this matter and of dealing with the dual problems of the housing stock and unemployment on Merseyside?

I accept the point readily. I know that my hon. Friend has made repeated representations in the House on this topic. Some of the money that the Chancellor of the Exchequer has made available for the construction industry will be made available in my hon. Friend's part of the world.

Urban Growth (Essex And Kent)


asked the Secretary of State for the Environment what plans Her Majesty's Government have for urban growth in South Essex and Kent as part of any dispersal of population from central London.

In South Essex Her Majesty's Government have a direct responsibility for the development programme for Basildon New Town which was not modified in the review that my right hon. Friend announced to the House on 5th April. The Government's more general view on the requirements of the South-East will appear in the response to the 1976 review of the Strategic Plan for the South-East, which we hope to issue later this year.

I thank the Minister for that reply. Is he aware that The Guardian of 20th April reported that the South-East Joint Planning Team was recommending the continuance of no fewer than 11 growth areas in South-East England and that the provisional report on the South-East—as the Minister indicated—also advocated continued growth of green field sites? Would it not be better to develop areas such as dockland than green field sites that might be more useful for agriculture?

I have seen the report to which my hon. Friend referred. He will understand that I obviously cannot make any comment on that. Such comment as we shall make officially will be made in response to the review of the Strategic Plan for the South-East.

I think that my hon. Friend will accept that it would be wrong to assume that as a consequence of the change in the direction of the Government's policy there will be no development in green field sites. There will obviously need to be some such development, especially in view of the smaller size of households now. That is why there may need to be some green field development. But I accept my hon. Friend's general point.

While my hon. Friend is considering urban development in South Essex and the laudable plans to rejuvenate inner London, will he also consider the problems created in North-West Essex, particularly for the second generation in Harlow? Is he aware that the decision not to go ahead with expansion in Harlow threatens to create a severe shortage of homes for all those in need—particularly for the second generation—during the next 15 years?

I am well aware of the problems to which my hon. Friend has referred. I certainly undertake to consider those issues carefully.

Following the questions that have been put on this matter by hon. Gentlemen on the Government Benches, will the Minister consider whether it would be better if the Government took a fresh look at the development of London itself, particularly dockland? Could not dockland be part of the New Towns Commission, so that proper development could take place? Would that not relieve the extra burden at present placed on the new towns?

I cannot accept the suggestion that dockland should form part of the New Towns Commission, because so much of what needs to be done in inner city development is bound to involve programmes that are already the responsibility of local authorities and of central Government. That is the reason why, after much careful thought, it was decided that the right way to tackle inner city problems was primarily in co-operation with local authorities and by bringing together the programmes of the various Government Departments rather than through the kind of corporations to which the hon. Gentleman refers.

Rate Support Grant (Berkshire)


asked the Secretary of State for the Environment what has been the percentage increase in the rate support grant payable to Berkshire over the last three years.

Berkshire's entitlement to needs element under the main RSG Orders for 1975–76 and 1976–77 showed increases of 35 per cent. and 19 per cent., respectively, over the corresponding payments for the preceding year. The initial entitlement for 1977–78 shows a reduction of 3 per cent. from the 1976–77 total.

Is the hon. Gentleman aware that this is a cut of £5 million in the grant aid to Berkshire? Is it not crazy that my constituency of Reading should be made a housing stress area while, at the same time, the grant is cut so that we cannot provide the facilities needed—particularly in areas of high-rise flats and housing stress?

We do recognise the problems of Reading but, as I think the hon. Gentleman recognises, Reading is only a part of Berkshire. The assessment of the needs element covers the county as a whole. Out of that grant and out of the assessment of need—which, of course, includes the specific problems of Reading—one hopes that Berkshire will see that the resources are diverted to where they are most needed.

Has the hon. Gentleman given any thought to allocating certain sums out of the rate support grant for special categories of expenditure?

Some thought is being given to the topic of specific grants but I am not in a position to say anything on that point now.

Inner City Areas (Grants)


asked the Secretary of State for the Environment what sums were made available by Government to relieve inner city depression in 1975–76 and 1976–77; and what expenditure forecast he has for Walsall for 1977–78.

The Government provide a great deal of assistance to local authorities through rate support grant, housing subsidies, and in other ways. I cannot say how much of these grants is spent in relieving inner city conditions, since this is a matter for local authority decision. Walsall forecasts that its total expenditure for 1977–78 will be about £51·6 million.

Is the hon. Gentleman aware that by his answer he has confirmed the feeling in the Black Country that the Government are neglecting the problems there? Does he realise that people there feel badly let down by this? Will the hon. Gentleman do something to remedy this defect when he publishes the White Paper?

I cannot accept what the hon. Gentleman said. For example, I draw his attention to the fact that in terms of the rate support grant needs element Walsall's share of the English grant as a whole has risen from 0·57 per cent. in 1974–75 to 0·62 per cent. in 1977–78. That does not demonstrate that on the matter of the rate support grant the Government have neglected the Black Country as a whole.

I repeat that the priorities have had to be identified in terms of the major areas of dereliction and inner city problems. In the West Midlands, Birmingham has been identified in that way, but that does not mean that the Government are unaware of other needs. For example, Walsall should receive grants of £610,000 under the urban programme during 1977–78.

Walsall is indeed an area of considerable urban deprivation. Will the Minister prevail on the local Conservative-controlled council to make an application for urban aid? Does my hon. Friend realise that the previous local authority made no application in 1975 for urban aid and that it has not even spent the money allocated to it in 1974?

I hope that my hon. Friend will make that point clear to the electors of Walsall, who may have an important comment to make on that matter in the coming elections.

Building Societies Association


asked the Secretary of State for the Environment if he has any plans to meet the Council of the Building Societies Association.

My Department is in continuing contact with the Building Societies Association, and I hope to see its chairman shortly.

Will my right hon. Friend request the Building Societies Association to explain better to savers in building societies and to those who have mortgages why building societies need to accumulate such large surpluses, which seem to the ordinary citizen to be spent on strings of offices in High Streets? There seems to be no reason why this money could not be channelled into extra mortgages.

There has been a longstanding criticism of the number of building societies, but this is not the right occasion on which to debate that. On the broader question of surpluses, there is a balance to be struck. We have all been anxious to avoid the sort of famine in money for lending on mortgages that occurred in 1973–74, and to do so it is necessary for building societies to have a cushion of reserves. Otherwise their ability to lend will be seriously impaired and may be subject to wild variations of the sort that we had in 1973–74.

Have the Government not been bringing disproportionate political pressure on building societies to reduce interest rates? If they desist from the stampede against the societies until the level of inflow of funds becomes clearer, is it not likely that the rate of lending to mortgagees will settle down and that we shall avoid the ups and downs of rates that we have seen in recent years?

That is a strange comment. I am not aware of any political pressure. I am aware and I am glad that we have continuing contact with the building societies. The purport of the hon. Gentleman's remarks seems to be that he believes that the recent reduction in mortgage interest rates was either premature or too large, and I do not necessarily share that view.

There is a balance to be struck. We are all in favour of low mortgage interest rates—that wish is shared throughout the county—but we do not want to pay the price of violent swings in the availability of mortgages or have famines of the sort I described earlier.

Is my right hon. Friend aware how reluctant many building societies are to lend on older and cheaper properties? Is he aware that in Salford, six of the nine leading building societies insisted on houses having front and back gardens and possessing—

Order. I have been very tolerant so far in allowing hon. Members to give information, and the House can see how slowly we are going. If the hon. Member for Salford, East (Mr. Allaun) will put his remarks in the form of a question I shall be able to call more hon. Members in the next seven minutes.

My hon. Friend has drawn attention, not for the first time, to the reluctance of societies in certain areas to lend on older properties—the red lining problem to which reference has frequently been made in the House. I am aware of the problem. We have a new relationship with building societies and I intend to take up this matter with them, not just in the general sense, but in terms of monitoring progress and taking account of evidence of specific acts of red lining so that I can take them up with the societies.

Is the right hon. Gentleman aware that his remarks have a different tone from those of the Prime Minister on this subject yesterday? Is he also aware that although we all want lower mortgage rates—especially those of us with mortgages—we welcome what he has said rather more than we welcomed the tone of the Prime Minister's remarks?

I should not wish to be described as tone deaf, but I was not aware of any marked difference of emphasis between what the Prime Minister said and what I have said. As always, we are in perfect harmony.

Does my right hon. Friend agree that even if there is a change in plan there should be no change in emphasis, and that we hope that building societies will bring down their rates to borrowers? Is it not disturbing that when the minimum lending rate has been reduced by 6 per cent. the building societies' rates to borrowers have been reduced by only 1 per cent.? Is he aware that the Government have a right to ask the societies to look at this again in the near future and to bring down rates further?

I am sure that a lowering of the mortgage lending rate is the wish of the whole country and it is also the wish of the building societies to adjust their rates as soon as they can, consistent with the major problems to which I referred earlier.

Is the right hon. Gentleman aware that the level of interest rates chargeable by the building societies essentially depends on Government policy? In the context of the repeated rise and fall of interest rates in the last 12 months and the cost to building societies of such changes, what criteria would the right hon. Gentleman use in giving advice to the societies?

This is inevitably a matter of judgment, which refers to two matters. First, there is the view that one takes of the structure of competitive interest rates for any period ahead. This has been particularly difficult to judge in the past year. Secondly, there is the inflow of money to the societies. We all have an interest in seeing that sufficient money comes in so that building societies are able to lend on the scale and with the consistency that the building industry requires.

Housing Loans (Bolsover District Council)


asked the Secretary of State for the Environment whether he will reconsider the allocation of money to Bolsover District Council for housing loan purposes, in view of the district council's policy of encouraging improvement grants for sub-standard properties.

The arrangements announced on 6th April to provide greater flexibility in housing capital expenditure for 1977–78 will help the council to link its home loans and improvement grants policies more clearly together.

That is a bit Irish. Is my right hon. Friend aware that it really means that last year the council received £238,000 for housing loans and that this year it will get exactly the same amount, not only for housing loans but for improvement grants? Will he tell his right hon. Friend, who described himself earlier as an attentive listener to calls for more public expenditure, that some of the £2½ billion that we have suddenly found we should not have cut from public expenditure ought to be used on housing in inner city areas, urban malaise areas, and urban stress areas—and some in Bolsover?

I always hesitate to disagree with my hon. Friend but I am afraid that his facts are wrong. The allocation for home loans to Bolsover this year is higher than last year's figure of a little over £200,000. This year it will be £238,000, and in addition there will be an allocation of about £300,000—I am sorry, £30,000—for improvement grants. The total will be about £260,000.

I was not speaking Irish or any other language; I was making the point that if local authorities are enabled to switch from one Vote head to another during the year they will better be able to link improvement policy with home loans on older properties. [Interruption.]

Order. We must remember that this is the Mother of Parliaments, where some dignity should be preserved.

Council House Costs (London)


asked the Secretary of of State for the Environment what is the average cost of a new council house in London.

The average cost of a new council house in London in 1975 was about £17,000.

As we now have a partially renovated Government, would it not be a good idea if they paid more attention to the renovation of existing properties in London—which, according to national average figures, costs about £6,000 per dwelling—than to the expensive building of new council houses. which the nation can ill afford?

The national average unit cost figure for improvements would not be applicable to London, though many excellent conversions have been achieved at that sort of cost. I do not accept the hon. Gentleman's general point. We need to provide more new dwellings where they are required as well as providing modernised homes that will not be demolished.

Is it possible that the housing report that the right hon. Gentleman and his predecessor have sat on for so long will point out the appalling unit cost of housing, which means that, including interest over 60 years, some new GLC dwellings cost about £250,000 each? This cannot go on. Is it not time the report was published, so that the country can decide what sort of housing policies it wants to see?

No report has been sat upon. The hon. Gentleman should check his facts. I suggest that he takes his remarks, which are rather exaggerated and a little gross, to the hustings.