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intervention capability if extended readiness, mothballing or any other euphemism that the MOD can produce, were to shroud the Ark Royal. We know from our experience of the Falklands war that a force consisting of two carriers affords a degree of air power that is barely adequate to conduct maritime operations in a hostile environment. Without the Ark Royal, it would be impossible to ensure even a two-carrier deployment.

As the Secretary of State said on Tuesday :

"to be an effective tool, a naval force must have a credible capability to act".

Unless the Ark Royal receives its planned refit, such a credible capability will cease to exist. The Secretary of State must understand that.

It is interesting that the Secretary of State specified nuclear-powered submarines in his speech. As we are all aware, last July the Government announced their intention to lease or sell the United Kingdom's fleet of four Upholder class diesel-powered submarines, a matter to which various hon. Members alluded. It must now be obvious to the Government, in view of the comments from hon. Members on both sides of the House, that the wisdom of that decision is questionable.

The smaller draft of Upholder vessels compared with the larger nuclear- powered attack submarines makes them better suited to the type of coastal operations that are vital in amphibious warfare, especially in mine- clearing and special forces operations. The unique inshore capabilities of those vessels are still required. It remains for the Government to explain how the assets will be provided if all four Upholders are sold.

The final element of naval power identified by the Secretary of State--the amphibious capability--is even more interesting. There has been a great deal of comment by hon. Members, including my hon. Friends the Members for Southampton, Itchen (Mr. Denham) and for Barrow and Furness, on amphibiosity and amphibious capability. We know that assault ships Fearless and Intrepid were used during the Falklands war and both would be needed again in any future large-scale operation.

"Extended readiness" is a phrase that we have heard again in relation to one or both of those ships. Will the Minister give a categorical assurance that Intrepid could be made operational in the event of an emergency? Will he confirm that Fearless has been kept operational in much the same way as the second division in the Gulf was kept operational--by cannibalising the first? Will he confirm that Fearless has been kept operational because the Intrepid is being cannibalised for spare parts? Unless he can give us that categorical assurance, many will wonder whether the guarantees that we shall have two amphibious ships at our disposal ring hollow. I fear that the real answer cannot be given tonight and that the term "extended readiness" is little more than an exercise in obfuscation. It is a matter of great national concern that the Royal Navy's amphibious capability has been allowed to lapse into such a state of disrepair. It is an indictment of the Government's approach to defence policy that they have so far failed to provide the resources and take the decisions needed to rectify that problem.

Last November, the Secretary of State announced to the Select Committee on Defence that he would invite tenders for a further batch of Sandown class minehunters, taking our total force "up to" 25 vessels. First, that was a declaration of intent, and no one should think anything else ; it is not a firm order. Secondly, it is vague

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commitment, with the phrase "up to" 25. Thirdly, even if the orders were placed today, there would be a danger period, spreading to the end of the century, in which mine counter-measures capability would be perilously overstretched. Can the Minister give us any further concrete news on how that situation now stands?

The merchant marine has been mentioned by almost every hon. Member tonight. I need say no more than that there is unanimity in the House that this country is no longer capable of mustering anything remotely near to the type of back-up that we would need from the commercial sector if there were a national naval emergency. One of the first priorities of a future Labour Government will be to seek ways to identify a core of militarily useful commercial ships and to devise the means by which their continued availability can be assured. The time for choices is rapidly approaching. We cannot go on indefinitely postponing decisions, pushing back orders and tapering back training. We cannot go on having cuts and cannnibalising one section of the armed forces' equipment to keep another one going. My hon. Friend the Member for Dunfermline, West quoted Churchill in a moving section of her speech. Churchill also said that one of the facts of life was that when one took the most audacious airman, the most courageous seaman and the most gallant soldier and put them in a room together, the result was the sum total of their fears. I am afraid that if we put the Ministers for Defence together, we would appear to get the sum total of their fears. They fear, on the one hand, the Treasury and, on the other, making decisions which might alienate some people in the short term, but which would be absolutely essential for the benefit of our armed forces in the long run. Unless they overcome those fears, they will do a disservice to themselves, the House, the Navy and the rest of the armed forces. 9.42 pm

The Minister of State for Defence Procurement (Mr. Jonathan Aitken) : I am glad that, in his catalogue of fears which he thinks the ministerial team has, the hon.Member for Motherwell, North (Dr. Reid) did not include a fear of the Opposition Front Bench. I can certainly assure him that is not high on our list of priorities.

I am glad to open the winding-up speech by paying the traditional, but nevertheless wholehearted, tribute to the men and women who serve in the Royal Navy and Royal Marines. Hon. Members from all parts of the House throughout the debate have expressed consistently high praise for their professionalism, loyalty and dedication to duty. I am glad to add the Government's tribute of appreciation to the senior service.

I express that appreciation tonight with particular feeling because, although there have been some encouraging developments today in Sarajevo about which I shall say something in a moment, it is still possible that Royal Air Force and Royal Navy pilots could have to go into action next week. That is a sombre thought and makes this debate on the Royal Navy all the more timely and appropriate.

There has been an encouraging and important new development to the situation in Sarajevo today. The Russian Government have offered 400 troops to join UNPROFOR. As a consequence of that announcement and

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of other developments, including the British Government's announcement that we will be redeploying some 300 men to Sarajevo from Vitez, it appears that General Rose is getting more and more of the troops he has requested to help monitor the ceasefire. That ceasefire appears to be making encouraging progress and it is being reported tonight that there has been a significant increase in the withdrawal of Serb artillery units beyond the 20 km line. It is too early to say that the ultimatum has been complied with, but the early signs are distinctly encouraging. The British Government welcome those developments. We are glad that the Russian Government have been so active in persuading the Serbs to withdraw their heavy weapons. The matters were discussed between President Yeltzin and my right hon. Friend the Prime Minister. They agreed on common objectives in Bosnia during their talks in Moscow. Both Governments wanted to see heavy weapons withdrawn from Sarajevo. Both Governments wanted to see those weapons brought under United Nations control. Both Governments wanted to see the peace negotiations given new impetus. Those developments appear to be happening.

My right hon. Friend the Prime Minister suggested that we and our partners should use whatever channels we had to bring our influence to bear on the warring parties. President Yeltsin privately gave the Prime Minister notice that he intended to send a personal emissary, Deputy Minister Churkin, to meet the Serbs, and that Russia might be prepared to deploy additional troops to Sarajevo to control heavy weapons.

My right hon. Friend the Prime Minister and my right hon. and learned Friend the Secretary of State for Defence did everything that they could to encourage that. So today's news that the Russians have made some progress is seen as a most welcome development, arising as it did directly from the talks in Moscow. The whole House will congratulate my right hon. Friend the Prime Minister on what has clearly been a most successful diplomatic initiative.

Sir Nicholas Bonsor : My hon. Friend is obviously right, and I am sure that the whole House will join him in congratulating my right hon. Friend the Prime Minister and welcoming the Russian initiative to send assistance to us in Sarajevo. I see on the tapes this evening that there is a planned meeting of NATO Defence Ministers in Italy on Sunday. Will my hon. Friend confirm that the meeting will go ahead ? We all hope that there will be no need to undertake any further initiative and that what has been agreed today will be effective.

Mr. Aitken : I can, indeed, confirm that my right hon. and learned Friend the Secretary of State for Defence, the United States Defence Secretary and Defence Secretaries of other nations that have aircraft based in Italy which would be involved in securing compliance with United Nations resolutions will meet in Italy on Sunday. It will be a briefing meeting which will allow them to be briefed at first hand by operational commanders of their own contingents.

I shall do my best to answer the points raised in today's Navy debate. Before I leave the subject of Bosnia, I must say to the two Opposition Front-Bench spokesmen that they seemed to be unduly and unfairly churlish about the

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British contribution in Bosnia. I should point out that we are already providing one of the largest contingents in UNPROFOR. We are contributing to the United Nations' immediate needs by agreeing to the redeployment of some of our forces, notably two companies of the Coldstream Guards from Vitez to Sarajevo and a mortar locating troop equipped with Cymbeline radar. Those extra special resources for which General Rose has asked are a most effective contribution and response to the United Nations request. General Rose has been told of this morning's Cabinet decision and I understand that he is very pleased with the British contribution. I only wish that the leader of the Liberal Democrats was in his place tonight. I would like to say to his face that his remarks in the House this afternoon were misplaced, ill advised and utterly wrong.

Mr. Charles Kennedy (Ross, Cromarty and Skye) : The Minister is perfectly entitled to his view. As he was so keen to say that to my right hon. Friend's face, did he contact my right hon. Friend's office during the day to give him warning that he would like him to be here?

Mr. Aitken : I intended no discourtesy in parliamentary terms. The leaders of parties can look after themselves and must expect their public statements to be responded to. It was not a personal attack. I was criticising his political position.

Mr. Kennedy : Will the Minister give way?

Mr. Aitken : No, I will not give way.

Mr. Eric Martlew (Carlisle) : It is now a quarter to 10 at night. Would not it have been better if the Prime Minister had come to the Dispatch Box at 3.30 pm and made a statement on Bosnia and Russia?

Mr. Aitken : The hon. Gentleman merely reveals the unsuitability of himself and his party for government. Has he never heard of secret diplomacy? Has he never heard of co-ordination of the timing of announcements with allies? Surely he realises that the British and Russian Governments had to co-ordinate. It was right that the Russian Government should make their announcement at the appropriate time. In the limited time available to me, I shall now return to naval matters. The hon. Member for Swansea, East (Mr. Anderson), who I see returning to his place--I hope that I did not worry him too much with my earlier criticisms ; I thought that he might have taken flight--asked about Upholder submarines. That subject was also mentioned by my hon. Friends the Members for Upminster (Sir N. Bonsor), for Ruislip-Northwood (Mr. Wilkinson) and for Birmingham, Hall Green (Mr. Hargreaves) and others.

As we announced in the 1993 White Paper, the Upholders are being withdrawn from service in the six months leading up to March 1995. That was an extremely difficult decision for us to take. It was due to the fact that there has been a fall in Soviet--now Russian--navy activity, particularly in the Greenland-Iceland gap, where the Upholders were designed and designated to patrol.

I was confused by the speech of the hon. Member for Swansea, East because, having criticised us for proposing to withdraw the Upholders, in another part of his speech he seemed to refer to the Greenland-Iceland gap and say how good it was that the United States had reduced its activity

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in that region. But at the end of his speech, he demanded less anti-submarine activity and greater power projection of maritime forces. I think that there was some confusion--he cannot have it all ways, even if he is a Labour party spokesman.

I agreed with the hon. Member for Swansea, East when he talked about the need for maritime power projection for various purposes, including the defence of what he called microstates. He referred to the landing platform for helicopters, which he mysteriously called a cost-cutting measure--that is not what my hon. Friends the Treasury Ministers called it when the project was approved. LPH achieves mobility, flexibility and the amphibious element that is crucial to future peacekeeping operations.

My hon. Friend the Member for Upminster referred to a rumour. He was right in describing it as a rumour, and I can scotch it once and for all. It was rumoured that, because we introduced the LPH, the carrier would be scrapped as a consequence. We have no such plans or intentions and the rumour is false.

My hon. Friend the Member for Upminster also mentioned piracy, and I can give him a more emollient reply than he was given by my right hon. Friend the Member for Epsom and Ewell (Sir A. Hamilton) about the Malacca straits. We believe that all attacks on merchant ships at sea are a matter of great concern. Royal Navy ships will take all appropriate measures to respond to incidents of piracy whenever they are able to do so. The United Kingdom is playing an active role with the Association of South-East Asian Nations and other states in the International Maritime Organisation to combat piracy.

Several hon. Members, including my hon. Friend the Member for Worcester (Mr. Luff), referred to the merchant shipping fleet, which has been of concern to us. The last decade has seen a significant decline in the British flag merchant fleet. We at the Ministry of Defence keep a close watch on the numbers of strategic ships to ensure that our plans are capable of being achieved.

Many of the issues raised about increasing the size of the merchant fleet are matters for the Department of Transport, not the Ministry of Defence. A new package of measures to help the British shipping industry and encourage more British shipowners to fly the red ensign was announced by the Department of Transport on 15 December. Those measures include new regulations simplifying the registration of merchant ships, and consultation on the proposal that, except for strategic ships where there will be a nationality requirement for the master to be British, or to be from British Commonwealth, North Atlantic Treaty Organisation or EC countries--officers of United Kingdom-registered ships can be of any nationality.

The hon. Member for Dunfermline, West (Ms Squire) made a moving speech. She has been a doughty fighter for her constituents, for which I respect her. She made an eloquent plea on behalf of Rosyth naval base. The 155 redundancies to which she referred have a simple explanation. It was confirmed in January 1992 that Rosyth naval base would be reduced to a minor war vessel operating base by April 1995. As part of the planned rundown to minor war vessel operating base status, we had, sadly, to announce up to 155 redundancies. There was no deceit about the subject, which was not part of the "Front Line First" study.

The hon. Lady made a powerful case for the retention of Rosyth naval base, not just in terms of avoiding

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unemployment among her constituents, but for strategic reasons. I shall consider her speech carefully as part of "Front Line First". There is no great secret or conspiracy--"Front Line First" studies all aspects of defence support activity, of which naval infrastructure is just one of 20.

Studies are being conducted across the naval estate and the study on the rationalisation of facilities at the Rosyth naval base must be seen in that context. No decisions have been taken ; nor will they be until after recommendations in the context of the studies as a whole have been presented to Ministers. The hon. Lady asked me six or eight questions about Rosyth naval base. I hope that she will understand that I cannot answer them in the time available, so I shall write to her and answer them.

I pay a warm tribute to my hon. Friend the Member for Tynemouth (Mr. Trotter) for the energetic way in which he champions his constituents' interests in difficult times. No other hon. Member writes, telephones or visits my office more often or more effectively. He and the hon. Member for Newcastle upon Tyne, East (Mr. Brown) asked me to pay tribute to the work force at Swan Hunter. I am full of admiration for their professionalism and high standards of workmanship in finishing our type 23 frigates and other MOD work during the past few months of acute disappointment and adversity. Their standards have been impeccable and highly admirable. I confirm that Swan Hunter is welcome to tender for new MOD contracts, although before we can place such a contract we shall need to see new ownership of the yard.

The hon. Member for Plymouth, Devonport (Mr. Jamieson) produced the unusual conspiracy theory that a Devonport dockyard could be taken over by Germans or Arabs. The answer to his question whether that could happen is emphatically no. Appropriate safeguards will be maintained. They will be necessary because the refitting of our nuclear submarines is of the highest importance to our national security interests.

The hon. Member for Ipswich (Mr. Cann) began his speech by saying that he had no criticism of the Government's policy towards the Royal Navy. That stamps him as an hon. Member with independence of mind. On the other conspiracy theory stories about Malaysia, various allegations were made, mainly by the hon. Members for Barrow and Furness (Mr. Hutton) and for Newcastle upon Tyne, East who seem to think that some special bias was encouraged by the Ministry of Defence towards frigates from Yarrow and away from frigates from Swan Hunter.

The choice of companies to supply equipment and contractual arrangements are matters for the Malaysian Government. Indeed, all defence purchases under the MOU by Malaysia were made for cash, with the customer making the decisions. Export Credits Guarantee Department facilities were not required and there was no question of taxpayers' money financing a series of successful orders for British industry, worth well over £1 billion.

As for the MOD playing a sinister part in that, all we did was to comment on the companies' technical competence, but we did not make a firm recommendation either way. That is entirely in line with our normal practice on such occasions. The choice of Yarrow for that order rested solely with the customer.

I apologise for being unable to answer all the points raised in this debate.

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Dr. Reid : Will the Minister give way?

Mr. Aitken : I have been cut short and shall not give way to the hon. Gentleman, as he took up two minutes or so of my time, which I could have been using valuably.

May I knock on the head the notion that the Government are drifting and doing nothing on defence procurement? In the nine months since our last Royal Navy debate, we have had a succession of impressive procurement decisions or orders worth well over £1 billion. Those include the important decision to award the landing platform helicopter contract to Vickers Shipbuilding and Engineering Ltd. In January, we announced the decision to purchase 18 new FRS2 Sea Harriers as part of an order worth some £200 million. A few weeks later, I announced the awarding of a contract for the development and production of Sonar 2076, as part of the overall Swiftsure and Trafalgar update programme, worth in excess of £400 million. My right hon. and learned Friend the Secretary of State announced that tenders for four single-role minehunters, with an option for three further vessels, were to be issued, as they were in December 1993 on the basis of the "UK-only build". Responses to that invitation to tender are due in April and we expect to place an order later this year. Meanwhile, the Trident programme continues to make good progress and HMS Vanguard, the first submarine to be accepted by the Royal Navy in 1993, proceeded to sea trials and is progressing well.

During the same period, what on earth have the Opposition been doing? The Liberal party's sovereign policy-making body, the federal conference, passed a resolution for a 50 per cent. defence cut. The Labour party passed a resolution by a two-thirds majority--composite resolution No. 49--the effect of which would be to reduce

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Britain's defence spending by a third, or £7.5 billion. That is the equivalent of removing the whole spend of the Royal Navy. For good measure, the brothers passed composite resolution 48, instructing the next Labour Government to carry out the immediate scrapping of Trident.

If those resolutions show what the Labour party thinks about the Royal Navy, at next year's conference Labour will probably pass another composite resolution banning the politically incorrect singing of "Rule Britannia".

By contrast, the Government believe in a strong and effective Royal Navy whose capability, versatility, flexibility and fire power make it one of the premier naval forces in the world. We have a core capability provided by our aircraft carriers, our nuclear-powered submarines and our amphibious forces. Questions have been asked about our carriers, but under current plans we will continue to maintain three Invincible aircraft carriers and HMS Intrepid.

I have referred elsewhere to the formidable work which our aircraft carriers have been able to do through fully utilising their wide range of capability while stationed in the Adriatic--

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.



That Mr. Robert Jackson be discharged from the Committee of Public Accounts and Mr. Richard Tracey be added to the Committee.-- [Mr. Wood.]



That Mr. Kevin Hughes be added to the Select Committee on European Legislation.-- [Mr. Wood.]

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Home Improvements (Merseyside)

Motion made, and Question proposed, That this house do now adjourn.-- [Mr. Wood.]

10 pm

Mr. David Alton (Liverpool, Mossley Hill) : First, may I thank you, Madam Speaker, for allowing this debate to take place and for giving me the opportunity to draw the attention of the House to the serious problems being encountered by applicants for home improvement grants on Merseyside ?

Let me first describe the genesis of the problem. Hon. Members may recall the massive 1960s and 1970s clearance programmes, when hundreds of thousands of homes were bulldozed, when communities were decimated and the heart was torn out of countless neighbourhoods. Family life was left in tatters as people were uprooted and scattered to overspill estates to which many did not want to go.

As a young city councillor in Liverpool in 1972, I was first elected for the Low Hill ward and fought my first election campaign on a pledge to stop the bulldozers in their tracks. When I became chairman of the city's housing committee in 1978, I was able to announce at my first committee meeting that we were pensioning off the bulldozer and to declare the largest ever housing action area programme in Britain. Thousands of homes in Liverpool were improved and many "Coronation Street" communities were given a new lease of life.

Since then, it has become axiomatic to declare a preference for renewal rather than demolition, so much so that, throughout the five district councils that comprise Merseyside, just 90 properties have been demolished in the past 12 months. Hon. Members in all parts of the House will embrace that principle.

No one expected all sub-standard housing to disappear overnight, but the hope was that homes would gradually be improved and that communities and neighbourhoods would be kept together.

On 29 November last year, a group of councillors and officials from the five district councils on Merseyside travelled to Westminster to bring me and other Merseyside Members of Parliament up to date with how those hopes are turning into fears.

Lest the Minister assume that I am making some narrow point, let me emphasise that the political representation was all-party and was of a very high calibre. The points I am raising tonight reflect that same all-party concern. They also reflect the concern of the local housing association movement. The Minister has had a copy of the representations from the housing associations and the local housing forum representing the five district councils.

Let me summarise the present position. Throughout the north-west, some 10 per cent. of housing stock is deemed to be unfit. On Merseyside the percentage is considerably higher--16.8 per cent. in Liverpool, 20 per cent. in Wirral and 23.5 per cent. in St. Helens. In addition, the local authorities estimate that a further 21.8 per cent. of properties across the country need renovation. Parliament lays a statutory duty on the local authorities to deal with unfit properties. We require them by law either to provide a renovation grant or to demolish an unfit property. Clearly, that requires resources.

Last year, the Government made available £32.5 million. The five local authorities, however,

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estimate that they need some £132.7 million to meet the duty that the House of Commons places on them. St. Helens requires £10.8 million ; Sefton, £4.6 million ; Knowsley, £5.3 million ; Liverpool, £74 million ; and Wirral, some £38 million. In other words, there is a shortfall of more than £100 million, and the local authorities are failing dramatically to discharge their responsibility to provide grants within six months of the application being received. In fact, the waiting lists are so long that some families on Merseyside have been waiting a staggering eight years since their application for a house improvement grant was lodged. Constituents of mine living in Wavertree and other areas, such as Aigburth, Edge Hill, Kensington Fields and the Allerton road area, have been waiting for intolerably long periods to get grants for basic home improvements. The current average waiting time throughout the country is four years and five months.

My colleague, Councillor Frank Doran, the Kensington councillor and a member of Liverpool city council's housing committee, was told in answer to a question at last month's city council meeting that, since 1990 in Liverpool, 12,360 inquiry forms and 3,559 tests of resources had been issued ; 3,377 inquiries had been passed on for initial inspection ; 2,153 applications had been determined as complete ; and that only 25 initial inspections took place each week on average. The current renovation grant regime is means-tested. As the Minister well knows, a new £20,000 ceiling applies to all mandatory grant applications submitted after 14 January. The information from the Greater Liverpool area underlines the fact that the majority of grants approved are going to the poorest households, living at or close to income support levels. In every authority, the majority of grants went to people who were unable to make a contribution : in St. Helens, 54 per cent. ; Sefton, 73 per cent. ; Knowsley, 67 per cent. ; Wirral, 60 per cent. ; and Liverpool, 75 per cent. Those figures represent people applying for house improvement grants who were unable to make a contribution, such were their incomes.

Now that the £20,000 limit has been imposed, undoubtedly the poorest people living in the worst housing will be the most adversely affected. Last year, 31 per cent. of people in St. Helens, 4 per cent. in Sefton, 3 per cent. in Knowsley, 18 per cent. in Liverpool and 18 per cent. in Wirral, all received grants above the £20,000 limit, such was the extent and cost of the work that needed to be done. Those families, who have to apply for grants higher than the new mandatory limit, will not be able to find the resources to fund the additional work that is required.

That acute situation has been made even worse by the Government's notification of funding levels for housing renewal in the current financial year. Across Merseyside, specified capital grant levels have been cut by 23 per cent. in one authority and, at worst, 40 per cent. in another, with average cuts of 29.4 per cent. across the county. Yet, paradoxically, at the time when those cuts are being made in funds for housing in the area, the European Community has given the area the dubious status of an objective 1 region. The casual observer might be excused some cynicism in contemplating cuts of nearly a third in the money available for house improvement grants, and cuts of £17 million in Liverpool alone in funds for day-to-day programmes, at the very moment when we are being assured that the area's pressing needs will be recognised and addressed.

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I am also disappointed that, in a letter sent to me today, the Minister's colleague the Earl of Arran has refused to meet the same delegation that came here to meet the cross-party group of Members of Parliament, and to listen to their arguments. That simply will not do. I am grateful to the Minister for being present this evening ; I hope that he will assure me that his door is open, and that he will be prepared to meet the delegation to discuss these serious problems.

Some 12,388 renovation grants are now restricted by lack of finance on Merseyside--879 in St. Helens, 731 in Sefton, 925 in Knowsley, 5, 148 in Wirral and 4,705 in Liverpool. That backlog will continue to grow. Homes will again have to be demolished as the spectre of new demolition and new clearance programmes appears on the horizon. In 1989, the Government recognised the need for a more strategic approach by introducing housing renewal areas ; I welcomed that at the time. Eight renewal areas were declared on Merseyside--11 per cent. of the total throughout the country. But, because home improvement grants are demand-led, councils are debarred from directing their limited funds to those areas. The result is "pepperpotting", and a consequential patchwork quilt with dereliction on one side and renovation on the other. In the same street, a beautifully improved home may be cheek by jowl with a derelict eyesore.

In Liverpool alone, there are more than 7,000 empty properties in the private sector, many in need of improvement. The renewal areas, therefore, are an embarrassment. Virtually none of the grants are even going to properties in those areas. The failure to target specific neighbourhoods contrasts sharply with the successful experience of the housing action areas and housing action trusts in the public sector. I hope that the Minister will consider that in the review of procedures that is currently under way.

I was brought up in a home without basic amenities. Over the 21 years in which I have represented people in Liverpool--either as a councillor, or in the 15 years for which I have had the privilege to represent them in the House--I have seen the misery that bad housing can create ; but I have also seen the radical improvements in people's lives that home improvements can bring. No end of men with building skills are currently unemployed : we should match their skills with people's needs, and tackle the decay of perfectly good housing before it is too late.

10.12 pm

The Parliamentary Under-Secretary of State for the Environment (Mr. Tony Baldry) : I congratulate the hon. Member for Liverpool, MossleyHill (Mr. Alton) on securing the debate, and on his commitment to his constituency. I do not entirely agree with all his figures, but I do entirely agree that we must make much better use of the housing stock that we already have--whether it is in the private or the public sector, and whether it is on Merseyside or elsewhere. I also agree that we must seek to improve both private and public housing stock that is in poor condition.

It may be helpful to set the hon. Gentleman's concerns in context. In September last year, the English house condition survey of 1991 was published. That survey

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represents the most up-to-date information available on unfit dwellings. The introduction of the 1991 data has made it clear that significant changes have taken place in the distribution of unfit dwellings.

The survey showed that, after allowance had been made for the change in definition of the fitness standard, there had been a reduction in the number of unfit dwellings across the country, and that reduction had not taken place evenly. In the context of this debate, it is worth noting that areas such as Merseyside--which had significant concentrations of unfit dwellings in 1986--showed a much greater improvement in conditions than areas with lower levels of unfitness.

Therefore, although I fully appreciate the hon. Gentleman's worries, I think that one should not lose sight of the fact that there has been a significant improvement in housing in Liverpool between the last survey and the most recent English housing conditions survey. That improvement in housing conditions was largely due to the effective targeting and investment of resources. Between 1986 and 1991, about £100 million of public money was spent on private sector renewal in Merseyside--not public sector, only private sector renewal--and that has had a direct effect on the reduction in unfitness.

Moreover, people's homes today are generally better equipped, better heated, better insulated and in a better state of repair than ever before. Those improvements resulted partly from building new homes and partly from demolishing the worst homes, but mainly from investment by public and private landlords, and especially by individual home owners in the improvement of their own homes. I am sure that the hon. Member will have seen for himself--as I have--the great improvements that have been made in many parts of Merseyside : for example, in Kirkby and Stockbridge Village in Knowsley, the Vauxhall area of north Liverpool and many of the estate action areas such as Netherley and Belle Vale.

Although those improvements are welcome, I acknowledge that there is more to be done to improve homes that are still in poor condition. I readily acknowledge that, for someone who lives in housing that is in poor condition, it is of little consolation to be told by a Minister that much has been done elsewhere. However, in the private sector, that must, in the first instance, be the responsibility of home owners. It is up to us, in the Government, to ensure that public spending is used to tackle the worst conditions and, in both the private and social rented sectors, resources are being targeted more effectively exactly to do that--to tackle the housing that requires that help most.

It is worth noting that the housing conditions survey shows that many households in the worst owner-occupied stock are not on low incomes, so the new emphasis on housing investment programme strategies will provide the right framework. Private sector renovation is already focusing on the worst housing and on those people most in need and, in the social rented sector, estate action and housing action trusts, such as the one in Liverpool, are tackling the worst social housing problems.

In 1991-92, a total of £17.5 million of capital grant was made available by the Government to the Merseyside authorities towards the costs of renovation grants to improve privately owned properties. In the event, the Merseyside authorities spent £20.6 million. All those figures are large because all the figures in relation to Liverpool and Merseyside are large, but they spent £20.6

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million. In 1992-93, we made available £19.3 million and in that year the authorities spent £23.5 million of grant. So, as they had spent more than had been anticipated, the Merseyside authorities were given an extra allocation of grant, totalling £2.65 million. In the current year, the grant allocation was £19.54 million, and the local authorities' estimate of spend is £24 million.

The Government have already met 95 per cent. of the difference by giving extra allocations. The point is that the amounts of money allocated to Liverpool in particular and to Merseyside authorities in general have been substantial. Year on year, the authorities have overrun their allocations, but, even so, they have received extra help in recognition of their needs. Indeed, the resources have enabled 20,000 Merseyside homes to be improved. Let me explain how that worked this year for the city of Liverpool.

Liverpool was given a grant guideline of £9.99 million for 1993-94. Its estimate for the full year's spending sent to the Department on the claim form last October was £13.85 million. On the face of it, that suggests a potential shortfall of £3.86 million. The Government have already responded : in December last year, an extra supplementary credit approval totalling £3.57 million--almost 93 per cent. of that potential shortfall--was made available. That was the largest allocation to any authority in the country.

Many millions of pounds were allocated to meet the local authority's needs and an extra supplementary credit approval was also granted. That is the action of a Government committed to meeting the demand for grant support in Liverpool and across Merseyside and responding to the very needs to which the hon. Gentleman referred. Local authorities are always concerned that resources for next year may not be as great as they were. I am sure that the hon. Gentleman and the whole House will be aware that there is pressure on public spending. Clearly, local authority capital spending cannot be immune from such pressure. Nevertheless, £20 million has again been set aside for 1994-95 to add to sums from underspending authorities elsewhere in the country in order to allocate extra money most effectively to those authorities where demand is greatest--undoubtedly those such as Liverpool.

Mr. Alton : As the Minister has challenged some of my figures, may I draw to his attention a letter from John Simm, assistant manager of private sector initiatives of St. Helens borough council? He writes :

"The problems we face have recently become more acute in light of the recent notification of levels of funding for this activity for financial year 1994-95. Across Merseyside Specified Capital Grant levels have been cut at best by 23 per cent. in one authority and at worst by 40 per cent. in another, with average cut of 29.4 per cent. across the region."

Surely the Minister accepts that, given such dramatic reductions in the money available, it is inevitable that many houses will not be improved. That will be a cost on the public sector in future when homes are demolished and people have to be rehoused.

Mr. Baldry : As I have already said, it is clear that, year on year, we are, and have been, investing considerable sums in supporting private sector refurbishment and renovation in Liverpool and all of Merseyside. Notwithstanding the pressures on public spending, we have this year alone set aside a further £20 million which will, of course, be added to the sums from authorities that do not spend their full quota.

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That money will be allocated for extra resources to local authorities that have the greatest needs. It is not unreasonable to infer that, as Liverpool has tended to have the largest allocation of such funding for private house renewal investment, it will have a not insignificant share of any further such investment. We are talking about significant sums overall.

We have also recognised some of the funding pressures that arise from the current system of mandatory renovation grants. That current system has been monitored carefully since its introduction in July 1990. We issued a consultation paper last summer on various possible changes to improve the system.

Not surprisingly, because it is a matter of considerable interest, the paper attracted more than 400 responses, and I am well aware of the keen interest of the Merseyside private sector forum and its strongly held views about resources--views which the hon. Member has fairly reflected this evening--about the benefits of a targeted approach and about standards, and the range of suggestions in its response to the consultation exercise. Its views are being carefully considered, and I would expect a further announcement about longer-term changes to the mandatory renovation grant system to be made shortly.

The hon. Member will know that my right hon. Friend the Minister for Housing, Inner Cities and Construction announced some short-term changes last November. There were three options to consider : a reduction in the grant limit, changes to the means test and a reduction in the level of Exchequer support.

There was widespread support for a reduction in the grant limit, although there was reluctance to see changes in the means test regulations or a reduction in the level of Exchequer support. That is understandable, and I think that it would probably be the case in any context, but, in the spirit of the consultation exercise, the grant limit for mandatory renovation and disabled facilities grant was reduced from £50,000 to £20,000, which means that the money available can be allocated to more homes for more families ; but the level of grant support and the means test were left unchanged.

It is also important to put the amount of money that is being invested in the private sector in Liverpool into the context of the full range of housing activity on Merseyside that the Government are supporting, since it might be thought that the figures that I have mentioned so far are the totality of Government's support for housing on Merseyside ; that is not the case.

We are investing in and supporting many housing initiatives in Merseyside. For example, the estate action programme has enabled large sums of money to come to the area. Over the past three years alone, over £100 million has gone into improving nearly 20,000 local authority dwellings, and many more millions from the private sector and from housing associations have contributed to the dramatic improvement of many estates across the area. The hon. Member will be familiar with many of the estates in Liverpool that have benefited. I am also glad to see that the estate action programme has encouraged many tenants, especially in areas of Liverpool, to get together and work towards managing their own estates. We have already seen the first tenant-management co-operative in the Colwell area of Liverpool, and there are other groups there and in the Wirral that are developing plans for estate management boards.

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