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Housing Cost Yardstick

Volume 931: debated on Wednesday 4 May 1977

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asked the Secretary of State for the Environment (1) when he expects to remove the restriction in making market allowances, thus allowing housing schemes to progress;(2) if he will publish the data utilised in establishing the increase from 6 to 8 per cent. in the regional variance allowance of the housing cost yardstick;(3) in view of the fact that the regional variation allowance of the housing cost yardstick has been increased from 6 per cent. to 8 per cent., if he is satisfied that this is a true reflection of housing costs within the Northern Region.

The recent increase in the level of the housing cost yardstick, as with previous quarterly reviews, is based primarily on movements in tender prices, which themselves reflect movements in such factors as labour costs, materials costs and the competitive state of the market, as well as future trends. As we aim to operate the yardstick at a realistic level I do not think it necessary to reinstate the market force allowance arrangements which were discontinued from March 1976.I am aware that some local authorities in the Northern Region have run into yardstick difficulties when tenders have come in but that it has usually been possible to bring schemes within yardstick arrangements.