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Mr. Gallie: I give way to the hon. Member for Renfrew, West and Inverclyde (Mr. Graham).

Mr. Graham: Does the hon. Gentleman remember the argument that I made earlier about four hospitals in my area that are earmarked for closure? If the £30 million that the Government squandered in Clydebank had been put into our area, we could continue to provide a much- needed service and at the same time stimulate the local economy.

Mr. Gallie: In the past I have used the services of the new hospital in Greenock, and I believe that if the Government invest, as they evidently are, in new hospitals, new clinics and new health centres there must be a reduction in older buildings. Opposition Members appear to fail to recognise that. They appear to think that one can keep everything from the past yet they expect what is new in the future. There is a rationale, and there is a balance to be struck. The hon. Member for Hamilton, in the search for cash, said that he would have stopped local government reorganisation. I would have to say--

Dr. Godman rose --

Mr. Gallie: Give me a break and let me try to get on a little bit.

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The hon. Member for Hamilton said that he would stop local government reorganisation because there is no clamour for it. Perhaps that is so in Hamilton, but in Ayr there was certainly a clamour to get rid of Strathclyde regional council. That was a promise that we made in our manifesto and, as usual, Conservatives meet their manifesto pledges and, as usual, we are doing so to a reasonable time scale--a time scale that the hon. Gentleman, in yesterday's argument, said was not achievable, yet now we find that we are bang on track. The elections for the shadow authorities are approaching. In Committee last year, the hon. Gentleman said that that would not be possible. The elections are coming up and the hon. Gentleman probably has his colleagues throughout Scotland all geared up for them. What the Conservatives promise, the Conservatives achieve. We will seek value for money.

Dr. Godman: Will the hon. Gentleman give way?

Mr. Gallie: No, but I may give way later. I have only until 10 o'clock to finish my speech.

Labour Members constantly moan and whine that local councils do not receive enough money, yet those councils are currently receiving 40 per cent. of the Scottish block grant.

Labour Members advocate a Scottish Assembly. If an Assembly is set up--I will do everything in my power to oppose such a move--it will place strain on local authority budgets because each Assembly member will want to spend money in his own area. Local authorities will be deprived of the very generous settlements that my right hon. Friend the Secretary of State has provided for them in recent years. Just as councils blame all their failures on underfunding from the Scottish Office, so too would a Scottish Assembly look to Westminster--to the seemingly bottomless pit of money that can be dipped into on a whim. The Conservatives recognise that there are no bottomless pits; funding is limited.

Dr. Godman: I am grateful to the hon. Gentleman for displaying his characteristic elegance and courtesy. I simply point out to him that I am the Member for Greenock and Port Glasgow. Many people in my constituency are deeply concerned about the inadequacy of the local community care programme that is being drawn up by the relevant parties and they are concerned about the threatened closure of Ravenscraig hospital.

Mr. Gallie: I fully accept that the hon. Member for Greenock and Port Glasgow (Dr. Godman) is who he says he is. The concerns that he expresses about community care could be echoed by virtually every Member of Parliament for Scotland. A time of change is a time of anxiety and concern. I was concerned that the introduction of community care meant passing responsibility to Strathclyde regional council. I welcome the fact that in future the new South Ayrshire authority will take responsibility for the provision of community care. I am sure that it will work very closely with the health boards and the health trusts to provide a very good service in the area. During a recent sitting of the Scottish Grand Committee I asked what increase, if any, there had been in local authority spending over the past four years. I was told that there had been a 14.5 per cent. increase. I was puzzled by

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that answer because Labour Members are always saying that local authorities face constant cuts. In the past 10 years, local authority expenditure has increased by 20 per cent. I would like to know where the cuts are; I would like Labour Members to justify their claims. Has staffing been cut in local authorities? No, because since the late 1980s the number of local authority employees has increased by more than 6 per cent. The hon. Member for Hamilton addressed those issues a short time ago. He and his colleagues constantly talk about cuts in local authority services and numbers.

Dr. Reid: Will the hon. Gentleman give way?

Mr. Gallie: No, I have been more than fair in giving way. I know that Labour Members will complain about me later for speaking for longer than I had intended.

Let us look at the facts. The aggregate external finance settlement, which comprises revenue support grants, non-domestic rates and other grants, totals £5.3 billion this year--that is 45 per cent. higher per person in Scotland than in England. That is food for thought. Yet local authorities continue to complain. It is a tradition for local authorities to complain. One year they will have something to complain about and no one will believe them--it will be a case of the boy who cried wolf.

Labour Members have threatened the business community, commerce and industry that a Labour Government will go back to the old ways and lift the controls from non-domestic rate contributions. That will also remove the inflation controls on non-domestic rates. If that is not true, I will give way and allow Labour Members to deny it. There is no protest from Labour Members, so obviously they intend to remove those controls.

I compliment and congratulate my right hon. Friend on the moves towards a uniform business rate. Business and commerce in Scotland have called for that measure for years, and we are all grateful for it.

Much has been said about the difficulties that we face in the housing sector, but since 1979 more than 250,000 new homes have been built in Scotland, and 20,000 new homes are constructed each year. Housing philosophy has changed and no Conservative Member should apologise for that. In 1979, 63 per cent. of housing was publicly owned; today, the figure is just over 45 per cent. Scotland is moving into the modern world-- a world which recognises that people like to own their own homes, invest in their property, improve their facilities and reap the rewards that flow from that. [Hon. Members:-- "Hurry up."] No, I have given way a number of times. I warned hon. Members that, on that basis, I was liable to extend my speaking time.

Strathclyde regional council claims that it will be underfunded in the coming year. I must acknowledge that the settlements are tight. I expected them to be tight, particularly in the wind-up year for regional councils. Strathclyde regional council should have recognised before now that there would be financial constraints and it should have planned for them in the long term. However, long-term financial management has never been Strathclyde's forte.

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In the months ahead, I expect my right hon. Friend to stick stringently to the statements that he has made about capping. His capping intentions are not idle threats and local authorities must be kept to the strict capping limits. I expect the same to apply next year when the new local authorities are established. I ask my right hon. Friend to cast his mind back to the introduction of the community charge. I believe that it was the right way to fund local government. The Government made one major mistake in introducing the community charge: they did not cap the authorities from the first year. On that basis, local authorities extended their expenditure and community charge payers met the costs.

Finally, having mentioned Strathclyde, I should draw attention to another local council, Tory-controlled Kyle and Carrick district council. When the Tories took control from Labour in 1992, they inherited a £4 million deficit, which they have paid off in just over two years. They have still managed to improve services and provide a range of new capital projects. I predict that this year, despite the tight settlement, they will not impose a 25 per cent. increase in council tax. They will not be talking about a 20 per cent., 15 per cent. 10 per cent. or 5 per cent. increase. I believe that Kyle and Carrick will produce no worse than a zero increase in council tax. Time will tell whether my prediction or that made by the hon. Member for Hamilton is right.

8.30 pm

Mr. Jimmy Wray (Glasgow, Provan): We have to remind the Government that 25 years ago we were clearing out the slums of Glasgow, which were the worst slums in Europe. People were living at 600 or 700 to the acre in rat- infested houses owned by private landlords. Tuberculosis was rife and people were dying of poverty. Past Tory Governments acknowledged that poverty and allowed it to continue. We are still in the same position. We have a golden opportunity to look after the people of Scotland and of Glasgow. In Glasgow, there are 22,213 dwellings below a tolerable standard and 7,000 houses are lying empty. In 1982-83, Glasgow received 5,673 applications of homelessness and in 1993-94 the figure was 12,500. No one has laid a brick in Glasgow since 1986.

We hear about all that is happening in Scotland, but it certainly is not happening in Glasgow, where some of the blackest constituencies suffer high infant mortality rates, rat infestation and decaying houses that are unfit for human habitation. The Secretary of State had a golden opportunity to give Glasgow the opportunity to do something about that, possibly by increasing the housing support grant, but what figures have the Scottish Office produced?

Since 1991, £22 million has been cut from the housing support grant, representing a cut of 95 per cent. in 1994-95 and a cut of 99 per cent. in 1996-97. Those are the figures we are given. We understand the policy, as I shall explain later in the debate.

There is an old Scottish saying that the Scottish Office formula should go out the window because the notional figures are a damned disgrace, especially when they apply to some of the most deprived constituencies in Scotland.

The Scottish Office works on a notional figure calculated on rents 10 per cent. higher than they really are. That represents a direct cut for local authorities in

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Scotland. Rents are calculated at £37.48 when, on average, they are only £27. It is a damned disgrace, a fraud and a lie to the Scottish people and it should not be tolerated.

The Scottish Office has calculated a notional figure for lost local authority rents because of the right to buy as 3 per cent. when the actual figure is 3.5 per cent. That is another cut being exposed. The Secretary of State for Scotland said that he was expecting rent increases of around 4 or 5 per cent. Why should that be when people find it difficult to pay their existing rents, particularly as inflation is running at 3 per cent.? His figures and his assumptions are wrong because Glasgow is proposing a 6.2 per cent. rent increase next year. One reason for that is the capping and the cutting. I thought that housing support grants were to get rid of the bad housing in Glasgow and to keep rents down, but the Government policy is to ring fence housing so that it is funded by the people who are paying rent.

Mr. Gallie: Will the hon. Gentleman give way?

Mr. Wray: If the hon. Gentleman will let me get started, I shall give way later. A further increase in rents in Glasgow of £1.02 is due to the right to buy, as local authorities have lost that housing stock. That has never been cash calculated as the Scottish Office never took it into consideration.

Then came the crocodile tears from the Government, who said that they were looking after the people who were suffering. They said that they set up a general fund contribution for local authorities that have many problems and are suffering from cuts. Last year, everyone applied to the general fund and everyone was refused, so the general contribution fund holds no water.

Mr. Gallie: Does the hon. Gentleman recognise that the capital raised from the sale of local authority housing has been passed back to Glasgow district to allow it to reinvest in its housing stock? Will he say what proportion of rents are paid through housing benefit in Glasgow?

Mr. Wray: What a shock I have for this man when I give him the figures for housing benefit and tell him where it is going. The Scottish Office should release the money to allow Scottish local authorities to build. If they are releasing it, they are not releasing it for housebuilding because they want it back in the private sector. We shall complete the cycle and we shall end up with the slums that we had in the 1950s and 1960s.

Mr. McMaster: The devious trick that has been used in Scotland is that when the Government give a local authority its capital allocation they deduct whatever it has been given in capital receipts. That sleight of hand has stopped many houses being built. Council house tenants are now the most heavily taxed people in the country. They pay the burden of homeless persons units for all local authorities and people are increasingly becoming homeless because many of those who have bought owner-occupied houses cannot keep up the mortgage repayments and council house rent payers are left to pick up that social problem.

Mr. Wray: My hon. Friend is correct. He has experience of a good working-class background and understands what slums are. I came from a family of 10,

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who lived in a room and kitchen. Seven of the family were bedwetters, which made it difficult--we invented the sauna. In most cases, housing is the largest single expenditure for individuals and families on low incomes. Governments earlier this century realised that and adopted policies to ensure decent housing for everyone, regardless of income. The policies were successful. The National Consumers Council found in 1977 that those on low income often received better value for money than others--mostly due to good quality, subsidised council housing. Those in private rented accommodation suffered to some extent.

Now we come to the sad story of when the Government took over in 1979. The election of the Tories in 1979 changed the position completely. Their policies totally altered the role of the public sector rented housing. The changes involved minimising public involvement and, as in other sectors, giving way to market forces. The main thrust of the Government's proposals was as follows: ownership was to be extended; Government expenditure was to be reduced and targeted more effectively; and local authority responsibility was to be decreased by increasing private ownership and transferring homes to housing associations, such as Scottish Homes, with the support of the majority of tenants. In addition, the private rented sector was to be improved and the number of housing associations was to be increased. The Government were taking housing out of local authority control--even though local authorities could probably have done something about the problems.

As well as those UK-wide plans, specific legislation for Scotland was introduced. Scotland, with its history of low ownership and large numbers of council houses, was seen as having plenty of potential. Legislation introduced included the Scotland Act 1980 and the Housing Planning Act 1986. Those Acts were supposed to benefit the poor. They introduced the right-to-buy scheme that allowed tenants to buy their houses at market value minus a discount based on the length of occupancy. They changed subsidies from buildings to households to help those most in need and shield the poor. The decline in council houses and the increase in private sector dwellings and housing associations was meant to increase the choice of accommodation available.

What happened? The policy of increasing home ownership has been a success in terms of numbers--with an increase of 450,000 new owners, but the prospect of home ownership has been unrealistic for those on low incomes. Even with discounts of up to 70 per cent. on the market value, the price was beyond the means of those on low incomes. Recently, they have also been unable to take advantage of the rent-to-mortgage scheme as repayments were once again too high. The Government then committed the cardinal sin--the bright Cabinet brought in deregulation. In 1989, the Tories deregulated private rents. Since then, housing benefit for private tenants has increased from £1 billion to £4 billion in 1993-94. That was mostly due to the massively increased rents--public money went straight into private landlords' pockets. That was a disaster for the Tories who said that deregulation would increase the supply of flats and houses and so decrease rents. Rents were also pushed up when council house building came to an end and restrictions were placed on housing associations' building programmes.

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The financial consequences of deregulation have not only caused massive rent increases, but misery for tenants, especially the poor, and huge bills for taxpayers. In 1989, public payments to landlords via housing benefit was £1.4 billion; last year that figure rose to £3.83 billion--a 280 per cent. increase. The Government have even suggested that by 1996-97, that could possibly increase to £5.2 billion.

I shall cut short my speech because I know that a number of hon. Members want to contribute. My hon. Friend the Member for Glasgow, Springburn (Mr. Martin) has, over many years, represented a district similar to mine in council and Parliament. I want to give him the opportunity to speak. I know that he will be as compassionate as other hon. Members who represent Glasgow constituencies.

The Government's housing record is a scandal and a disgrace. The Government must be reminded of their legacy. We will not let them forget it.

8.45 pm

Mr. Bill Walker (Tayside, North): I shall make only a brief contribution to the debate. I shall speak purely and simply about housing, which is important.

A civilised society has a duty and a responsibility to provide adequate housing at affordable rates for all its citizens. It is one of the great indictments of this country that we have been unable to achieve that objective with the vast sums of public money that have been spent. That is not because the public purse or taxpayers' money has not been spent; vast sums of taxpayers' money are spent. I shall give an example from my constituency. Angus district council is being congratulated because it has kept down its council house rent increases. That is why the council has been unable to build up adequate funds to maintain its stock of property in a fit condition for modern people. Angus, like every other council with houses to rent, has failed to make use of housing benefit as a means of pouring vast sums of money into its housing coffers. It is available as of right to individuals--which is what every hon. Member would want.

I listened to the hon. Member for Glasgow, Provan (Mr. Wray). I know something about living in a small house with eight children and sharing a bed with four others. The only marvellous thing about that is that today my family--we are nearly all pensioners now--is still as close as we were when we were children. Perhaps there are lessons there for all of us. The entire family was at my eldest brother's home the week before last, and it was great to see everyone there. There has been a failure to cash in on the £800 million being spent every year in Scotland on housing benefit. Of course, I know that the money does not all go to council houses, but council landlords have failed to cash in on that golden tap because they have set rents at unrealistic levels. The levels should ensure that there are adequate funds to carry out the necessary maintenance repairs and modernisation in the lifetime of those dwellings. If the landlords had done so during the lifetime of housing benefit--which has been with us for a long time--there is no doubt that we would not now be suffering. I see that the hon. Member for Angus, East (Mr. Welsh) is shaking his head. The trouble with the hon. Gentleman is that he

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does not understand that, unless one takes the money that is available as of right, it will be used elsewhere and will be lost to the council house coffers.

Mr. Welsh: Angus district council has kept its rents down by good management and has used housing benefit for the benefit of tenants. The hon. Gentleman fails to remember that when the Conservative party was in charge of Angus district, it wiped out all reserves and left nothing for the ratepayer. The Conservative council gave poor service and poor value for money.

Mr. Walker: If the hon. Gentleman is telling me that there are no problems with maintenance, condensation or damp in Angus district council, he is talking rot. He knows it and I know it. I have to deal with the problems of my constituents who are the tenants of Angus district council.

Mr. Welsh: Will the hon. Gentleman give way?

Mr. Walker: I am about to sit down. I did not say to the hon. Gentleman that there were not some things that Angus had done well. I said that it had not cashed in on all the funds that were available. That is an indictment of the council.

Mr. Welsh: Is this an intervention?

Mr. Deputy Speaker: Order. Has the hon. Member for Tayside, North (Mr. Walker) concluded his speech?

Mr. Walker: I said that I would be brief.

Mr. Deputy Speaker: Commendably brief.

8.50 pm

Mr. James Wallace (Orkney and Shetland): I do not propose to be quite so brief. It is an indictment of any party for it to argue, as the Secretary of State did when he met the Convention of Scottish Local Authorities, that it is all right to thump up rents because housing benefit will cushion the increases. The people who are entitled to housing benefit are those in poverty and in the greatest need. The Government shelter behind those in greatest need to provide some doubtful justification for their policies.

The hon. Member for Tayside, North (Mr. Walker) suggested that local authorities should thump up their rents because they could claim the money in housing benefit. One wonders what the Secretary of State for Social Security would do if that happened. It has happened in the private sector and the Secretary of State is taking steps to stop it. The councils would not be allowed to get away with it for long.

Every year one has to go back to basics to work through the various ways in which housing grants are allocated. Housing finance may often appear complex, but the simple fact is that, as investment in housing has been restricted, there has been a rise in homelessness. Nothing in the housing orders before us gives us any confidence that the necessary increase in investment in housing will be provided to meet the problems of dampness and condensation that the hon. Member for Tayside, North mentioned. Nor is there anything to bring any hope or relief to those who have waited too long on waiting lists. I am sure that in our constituency surgeries we all deal

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with constituents who have housing problems. One fears that one cannot go back and tell them that anything in the orders is cause for hope.

The debates on housing finance and revenue support grant are an annual ritual. When I first came into the House, I heard my hon. Friend the Member for Inverness, Nairn and Lochaber (Sir R. Johnston) speak in a similar debate. He said that he had been making the same speech for 15 years. We face this evening a set of orders which, no matter what is said in the debate, are essentially non-amendable. The Secretary of State's word will be law.

It is interesting to ponder the fact that in the regional council elections in May last year, out of 453 regional and islands councillors, only 31 Conservatives succeeded in being elected by the people. Yet we have a Tory Secretary of State who will largely determine the budgets of Scotland's councils. With some 87 per cent. of councils' income in the hands of Ministers and with capping powers, the Secretary of State has taken over the function of council treasurers the length and breadth of the land. To us, that is a travesty of what local democracy should be about. The essence of accountable democracy is that local representatives have a financial responsibility. That has all but been taken away by the steps that the Government have taken.

This year's settlement is particularly draconian. If one excludes community care provision, it amounts to a 0.5 per cent. reduction in cash terms. One can bandy figures about, but when one puts them in the context of services, it becomes clear just what is happening to our local authorities and the people who depend on local authority services as a result of the settlement.

The settlement has put strains and constraints on local authorities. It takes no account of the pay increases for public sector employees except those for the police. A 5.1 per cent. increase for teachers over two years is scarcely a generous settlement, not least when we are expected to have a well-qualified and well-motivated teaching profession. To meet the constraints, there will have to be a reduction in the number of teachers, or it will not be possible to employ additional teachers to take account of rising school rolls.

The figures for 1991 to 1993 show that 75,000 primary school pupils in Scotland are in classes of more than 30. That is an increase of 3.6 per cent. There has been a 17.7 per cent. increase in the Borders and a 12.9 per cent. increase in Tayside. In secondary schools, 89, 000 pupils are taught in classes of more than 30. That is an increase of 35.9 per cent. over the two years. That must be set to increase even further as a result of the orders that we are debating. My hon. Friend the Member for Inverness, Nairn and Lochaber outlined the choices that Highland regional council will face as a result of the revenue support grant settlement. Grampian regional council will require a base budget saving of some £31 million. Let us consider what £31 million amounts to. It is equivalent to the council's total spend on nursery, special and community education in the current financial year. It is the equivalent of the annual salaries of 10 per cent. of the council's work force. If a teacher's annual salary, including on-costs, amounts to £24,500, £31 million is the equivalent of the salary bill for 1,265 teachers--the staff required to run approximately 18 of the council's 38 secondary schools or 145 primary schools.

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The total salaries and wages budget of the police was £31 million. That figure is equivalent to twice the spend on Grampian fire brigade in 1994-95. It was the entire planned spend on road maintenance, including winter maintenance. Perhaps the Under-Secretary of State for Scotland would like to tell us which of those services should be cut as a result of the constraints placed on Grampian regional council. Make no mistake, when the cuts take place, we shall make sure that the responsibility is on his lap and not on that of the councillors whom he is making implement his dirty work for him. In my constituency, there will have to be a 5 per cent. reduction in spending to keep within capping levels. Some key decisions will have to be taken on the basics such as maintaining the ferry services to some islands, on which the islanders very much depend. Perhaps in 1980 and 1981 there was some fat that could be cut, but now we have had year after year of cuts, so there is no fat left. We are eating into the muscle. Local authorities are right down to the bone. Where does the Secretary of State think that the savings can come from? He makes great play of the increases in staffing, yet he has never said what proportion of the increase relates to extra responsibilities for functions such as community care and devolved school management. Those are Government policies which local authorities have to implement. They require extra staff to do so. In giving his figures, the Secretary of State said that he would like to see a reduction in spending on libraries. For centuries, public libraries have been an important part of the community, yet he wants to see a programme to run them down. The Secretary of State wants fare concessions to be limited. He has even suggested in some of his figures that he looks to councils to make savings on burial grounds. I remember when that was suggested on a previous occasion, when Shetland Islands council was trying to meet its budgetary demands. Someone suggested that it should dig shallower graves. We now have a Government who hold out the possibility that councils should dig shallower graves to fund basic services.

I assume that most hon. Members received representations this week from the National Association of Funeral Directors. It drew attention to the pressures on many families as a result of the limitation on social fund payments for funerals. Now the Government advocate increasing burial charges.

I have outlined some of the real choices that local authorities will have to make. That leads to a fundamental point. There is a breakdown in trust between central and local government. In a mature democracy, there are different centres of power. While there will sometimes be friction, at the end of the day they should work together in partnership rather than in conflict.

I admire people of all parties who intend to stand for election to the new authorities on 6 April. They will have a pretty thankless task. In many of the smaller councils with limited budgets, they will have to choose which services to cut. There will be little scope for innovation or positive action in the interests of the communities. There will be no joy in making choices between cuts. It is no basis for establishing a new system of local government. We need to reinvigorate local democracy and recreate a positive partnership between central and local government.

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The Secretary of State has sought to blame COSLA for the problems, but the blame lies fairly and squarely with the Government. When services are cut and when the increased council tax demands fall through the letter-boxes, the blame will lie on the Treasury Front Bench. Our candidates will ensure that people know those facts before 6 April.

9 pm

Mr. Michael J. Martin (Glasgow, Springburn): I am surprised that the Secretary of State, who has presided over the worst-ever unemployment in Scotland, should say that too many people are employed in council services. He should ask the question: if the councils start sacking employees, where will they go? The railway workshops, the tobacco industry in Alexander parade in my constituency and the shipyards have all lost labour. If it were not for the local authority, there would not be an apprentice in the building industry in Glasgow. The great private sector, about which Conservative Members are always bragging, get benefits from that. When the young apprentices have finished their training in the direct labour departments, the private sector is the first to snap them up. It wants the bricklayers, the carpenters and the electricians, but it does not want to train them.

Hon. Members have already referred to Scottish Homes. That organisation snaps up the young officials who get diplomas and training from housing departments in places such as Glasgow and Renfrew. When there is so much unemployment in Scotland, the Secretary of State should not say that local authorities should sack staff. He and his Ministers should be creating more jobs in the private sector to take the pressure off local authorities. One area that could do with more employees is the concierge service, which should operate in every multi-storey dwelling in Scotland. In the old days, people came out of tightly knit communities in the old tenements and went into the new flats. There was no problem then. Now, unfortunately, in some of the multi-storey flats there is a certain element who will not give the other people peace and quiet and there is vandalism.

Great waste is associated with the hospital in Clydebank. I have spoken in debates in the House and highlighted the way in which Government money has been spent on so-called job creation schemes; that money has gone down the drain. Why not spend money on a concierge system that would give 24-hour coverage with video cameras in the multi-storey flats?

Some of the homes in those multi-storey dwellings are like palaces, but the residents are ashamed of the entrances--they are ashamed to bring their friends and relatives into those blocks. It is no easy answer to say, "Pull them down." In certain areas of my constituency that would be the equivalent of pulling down a small town. It would be ridiculous. A concierge system would be a great benefit. As I said, some of the homes on the council estates in my constituency are absolutely beautiful. Recently, I went into one and I can say that no interior designer could have designed the inside of that house as well as my constituent had done. It would have done a Barratt show house proud. There is that sort of home on every council estate in Glasgow.

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People need backing; they do not need a Government who cut the support grant. The Minister knows that in some of the housing estates the people are fighting against terrible odds. In the next tenement to that beautiful home was a house where the damp was so bad that the resident had to pull the bed away from the wall so that she and her children could have a decent night's sleep. Scottish Homes will not provide the money to reroof the tenement.

I did not do my training in the building industry, but I know that if a roof is neglected the rest of the building will crumble. The resident had lived in the community all her life, as had her husband. There is a network of relatives and friends around them. She does not want to leave her home, but if the roof is neglected she will be forced to leave and the local authority will have to rehouse her. My hon. Friend the Member for Glasgow, Provan (Mr. Wray) was brought up in the Gorbals and I was brought up on the other side of the city in the Anderstoun district. We were brought up in the slums, so we know what it is to get a council house. Many people who went into those council houses were very proud of them. Now, the properties need a lick of paint, reroofing and repairs. This is not the time for the Government to neglect them.

As the Minister may know, the chief medical officer in Glasgow appeared on a BBC television programme on Monday evening saying that the life expectancy of young couples on those council estates, compared with people only half a mile up the road in Bearsden, is being reduced by 10 years. In almost every estate people are living in life-threatening conditions. We must do something about the dampness and the neglect. Resources must be provided to combat anti-social behaviour, which is a serious problem. Some young couples who are unemployed are being aggravated by their neighbours and that will cause stress. Any heart specialist will say that such stress leads to heart attacks and shortens people's lives. It is an indictment on the Government. Many people in Scotland have to be on housing benefit, but any person in receipt of housing benefit would say that he would rather have the dignity of a job and be able to pay his own rent--something which the Government fail to understand. The question has been posed: where is the money to come from? In my constituency, all the good housing stock has been bought by the sitting tenants. I do not begrudge them that--it is their right under the legislation. I was not against the sale of council houses, but I thought that it should have been qualified by an obligation on local authorities to build another council house for every council house sold. Furthermore, they should have been given the money to do that. In my constituency, many council houses have estate agents' "For Sale" signs up in front of them. The unemployed rail workers and tobacco workers will have no chance of buying them; they will go to the highest bidders. If market forces are to prevail, the only way to resolve this problem is to enable local authorities to provide decent housing for the people who cannot afford it themselves.

I have another suggestion for finding the money. There are some signs, thank God, that the troops will be able to leave Northern Ireland. That being so, the Army will no longer need the resources that it used to need to maintain 24-hour security coverage. The same applies to the British Army of the Rhine. The Government did not begrudge the Army, Navy and Air Force the money in the past. If there

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is to be a peace dividend now, it should go to pay for the basic right of every man, woman and child in Scotland to a decent home and a decent roof over their heads.

9.10 pm

Mr. Andrew Welsh (Angus, East): The hon. Member for Glasgow, Springburn (Mr. Martin) has made an impassioned plea, based on hard-won experience, on behalf of his constituents. Too many of our fellow citizens face these problems. That is what the debate is all about: how are we to react to the conditions in cities that we see all around us, to ensure that our citizens enjoy decent homes and living standards?

We have heard a concerted assault from the Opposition on the Government's proposals, but from the Government we have heard no reaction--only a statement that this is the best of all possible settlements. We have heard no justification or rationale from the Government. We have heard about no general plans for local government finance. We have certainly heard no attempt to relate the Government's budgetary proposals to real councils and real services in the real world.

No wonder the Government have not made this attempt--their proposals are wholly inadequate for the purpose. This settlement ignores Scotland's wealth and imposes a freeze on and cuts in essential daily local services. How can it be realistic to make Glasgow, Edinburgh and Renfrew, with all their problems, freeze their spending to avoid capping, and not even to permit them to allow for inflation? Councils such as Clydebank also face cuts. This time, the Government are putting the squeeze on all the councils of Scotland, with the exception of two of the smaller ones. For the second year running, the Government have made no allowance for wage increases in cash or for capping purposes, and their policy seems set to continue. Even prudent councils find themselves facing massive council tax rises or unacceptable cuts in basic services--all due to this settlement. I thoroughly agree with Councillor Rosemary McKenna who has said:

"Once again we will NOT be making choices about how we provide the best service to Council Taxpayers. Rather we will be looking at how we can provide a service which meets Government imposed targets."

This is the Government's internally driven budget, certainly not the people's budget.

Grant-aided expenditure may appear to be 1.1 per cent. higher for next year, but when provision for care in the community and for other new burdens is taken into account, the settlement turns into a reduction in the provision for current services of about 0.5 per cent. While oil-rich Scotland needs better services and a job creation programme, all we get from this London Government are cuts and closures. It is not good enough. The Government clearly lack the imagination and the impetus required to solve Scotland's problems. That is why there is no war on poor housing conditions. There are no major housebuilding or improvement programmes that would use Scottish skills and Scottish materials to get folk off the dole queues and to create assets for generations to come--and to meet today's real housing needs. Instead, we are offered only housing support grant, which cuts net spending by 12 per cent. in cash terms and by 19 per cent. in real terms over the next

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three years. Meanwhile, gross spending is to fall by 10 per cent. in cash terms and by 17 per cent. in real terms over the same period.

In real terms, taking into account capital receipts of £175 million, less will be directly invested from public sources in Scottish housing three years from now. So much for the future offered by this Government. The truth--as opposed to the Government's policy--is that 500,000 houses, 30 per cent. of Scotland's housing stock, suffer from damp, condensation or mould. Forty-two thousand households are homeless. Such massive problems affect all too many of our fellow citizens' daily lives, and they are not being tackled to ensure an end to them even in the distant future. The most vulnerable in society bear the brunt of the failure of Government policies. When will that unacceptable situation change? I suspect that the same will happen next year and the year after that, as this incompetent Government stumble from crisis to crisis. Those cuts are only part of a series imposed on local government over the past decade. While central Government load more responsibilities on local authorities through legislation, they increasingly impose financial cuts--the worst of all possible worlds.

The budget is hopeless and offers no chance of improving housing services this year, next year or the year after. It is time that finance was related to real need and time for Scottish local authorities to enjoy a period of stability, to permit longer-term planning to meet the actual needs of people in their areas. No one expects the backlog of Scotland's social and economic problems to be solved instantly, but we have the right to a logical, long-term plan that will do something about them, and the Government have failed totally to provide one. We wait in vain, and this load of financial rubbish will only store up more trouble for local authorities and the people who rely on the essential daily services that local authorities provide. Pocket money instead of investment will not do. Massively rich Scotland deserves better, and now Scotland can do something about that.

The Secretary of State slid away from my point about unified business rate levels and its effect on Scottish business. The first common UBR may not provide a level playing field. Scottish rentals have risen 53 per cent., whereas the figure in the rest of the UK was only 1 per cent. To maintain the same yield, revaluation would require a similar level of 42.3p in the pound in England. Scottish rental evidence suggests a considerable rise in rateable values. I would be happy if that were a sign of increased business, as the Secretary of State implied, but it is a sign of revaluation. The Scottish Office's lowest estimate of revaluation is that the tax yield on 42.3p would produce £80 million more than was required to meet the Government's suggested yield. The figure could be higher, which would not be the promised level playing field. I invite the Minister to respond tonight to the comments of the Scottish Council (Development and Industry).

It is clear from the settlement that the Secretary of State has no interest in fighting for Scotland. His constant refusal to help overcome Scottish councils' financial problems is based solely on Treasury dogma. His much- vaunted seat in the Cabinet has done nothing to stop Government and Treasury actions in respect of Scotland

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and our local government system. The Secretary of State should step aside and allow a Treasury Minister to lead the debate, because the right hon. Gentleman is obviously not master in his own house. 9.18 pm

Mr. David Marshall (Glasgow, Shettleston): Are not thousands of houses in Scotland affected by damp and difficult and expensive to heat? There appears to be no disagreement about that among Conservative Members-- but instead of doing something positive, the Government have cut housing support grant year in, year out. If Ministers had to spend a Scottish winter in some of those houses, perhaps they would do something--and double quick.

Such properties may be called houses; they certainly cannot be called homes. In my constituency and in the city of Glasgow, far too many sub- standard houses are causing untold misery, discomfort and problems for tenants, especially health problems, for young and old alike. The incidence of asthma is greatly increasing among young children. Bronchitis, chest problems and poor general health are widely prevalent. Dry, comfortable homes are essential to combat such ailments and are also cost-effective in reducing national health service expenditure.

The housing support grant formula is a framework that shows central Government policy decisions to be implemented. The Government are committed to giving no central Government or local taxpayer support to council housing, and will continue to manipulate the formula--that is what they do- -to ensure that that continues.

It is always a pleasure to follow my hon. Friends and neighbours the Members for Glasgow, Provan (Mr. Wray) and for Glasgow, Springburn (Mr. Martin). Some of their excellent remarks are well worth repeating, and I make no apology for doing so. I am grateful also to Mr. David Comley, the director of Glasgow district council's housing department, for providing facts relevant to the debate. Glasgow manages approximately 120,000 houses. Rents in Glasgow are due to go up by 6.2 per cent. from 1 March--double the new, increased rate of inflation--an average amount of £1.94 per week, which is not a small amount, as the Secretary of State said, especially to the many thousands of people eking out a miserable existence on very low incomes. It is a hell of a lot of money to those people. It ill-behoves the Secretary of State to dismiss such a large increase for so many poor people in the way in which that he did.

The council's commitment to investing in its housing stock means spending £104 million on improving it in the current year, and that has added 51p per week to the rent. The loss of stock, which has been mainly due to the right-to-buy sales, demolitions and transfers to new landlords has resulted in £1.02 per week being added to the rents paid by a reduced number of tenants. The cessation of direct Government support to the council housing service, which, in the early 1980s, paid for around one third of the service, has added a further 40p per week. At the same time, the council, by a very painful decision-making process, has been trying to reduce

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