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Mr. Matthew Banks (Southport): Let us be clear about this: is the hon. Gentleman saying that the whole of the local authorities' debt in Scotland should be transferred to the national taxpayer, because that debt currently stands at about £1,040 per head of the population north of the border?
Mr. Salmond: I was suggesting that 75 per cent. of the £4 billion of accumulated capital debt should be transferred to central Government over a four-year period. As the hon. Gentleman will know, that will have no effect on the public sector borrowing requirement, as the PSBR is both a local and a national borrowing requirement. The £900 million-plus over four years that I have estimated is the effect of deferred interest will then be paid by central Government.
The hon. Gentleman will recall that when the water services industry in England was transferred to the private sector, a £4 billion to £5 billion debt write-off, or dowry,
was awarded to the private companies. Although there has recently been a £700 million write-off of capital debt in the Scottish industry, it has been accompanied by a lowering of the spending provisions, to give no additional resources to the industry in Scotland.
The hon. Gentleman is in a poor position to argue that transferring capital debt--or writing it off, for that matter--is not a viable policy option, when the Government have been keen to adopt it when sending industries into the private sector. We are suggesting that the same mechanism be used to refinance the public sector, without the privatisation process. The hon. Gentleman is probably not aware that the mechanism of transferring capital debt was first suggested by, I think, the late Sir Robert Grieve, one of the great authoritative figures in Scottish housing, in a report on Glasgow housing some years ago. I think that Robert Grieve would have forgotten more about Scottish housing than the hon. Gentleman is ever likely to learn.
With those new resources, we would be able to carry out a substantial programme of new build--perhaps 11,000 new homes, to be developed by local authorities in partnership with housing associations.
I shall soon conclude my remarks in order to allow a number of hon. Members the opportunity to speak, some of whose speeches have, I note, been signalled in the Scottish press. I would not want to deprive readers of the Evening News in Edinburgh of the advantage of hearing a contribution from the hon. Member for Edinburgh, Leith (Mr. Chisholm).
I have some specific questions for the Minister. The housing organisations told me yesterday that they were concerned--I am choosing my words carefully--that the Minister with responsibility for housing was about to announce a rough sleepers initiative in Scotland. They were concerned not that he was about to announce the initiative, but because it seemed that the initiative was to have no additional resources, unlike that in England, which received a total of £250 million for London and elsewhere.
Housing associations and bodies in Scotland expressed concern that the Minister was minded to announced a rough sleepers initiative involving the secondment of housing staff from Scottish Homes, but no additional resources. I am sure that the Minister will take the opportunity to allay the concern that he might announce such an initiative without the resources required to make a difference.
I have at various times heard the Minister talk about high public expenditure on housing in Scotland. The argument that anything spent in the public sector represents some sort of subsidy, even when it is not subsidised--by and large, housing in Scotland is not now subsidised because of the decline in revenue support--whereas private sector housing, which is subsidised, and rightly so, does not represent subsidy, is foolish. If he compares the accounts of public housing provision in England and Wales with those in Scotland and removes the capital debt overhang, which, I suggest, would be a good and viable policy option for any Government, he will find that expenditure per house in England is currently higher in the public sector than in Scotland.
I cite figures provided by the Library, which estimates that last year, in terms of housing revenue account expenditure, £2,070 was spent per house in England and
Wales compared with £1,680 in Scotland. Given what we know about the quality of Scottish housing stock, is the Minister satisfied that there is such a discrepancy in the public sector between expenditure per house in Scotland and expenditure per house in England and Wales?
Unlike the Government, who take the attitude that anything in the public sector is bad and anything in the private sector is good, the Scottish National party has no ideological bias in favour of any form of housing, public or private. In fact, we should like owner-occupation to be made a lower risk by continuing to allow tax relief, investigating the feasibility of fixed-rate mortgages and restoring grants to those who have the problem of trying to maintain older housing stock in the private sector in durable condition.
I ask the Minister to reflect on the fact that the balance of housing in England has been a severe problem for the English economy. In the boom periods--for example, that of the 1980s--economic expansion was diverted into the housing market, leading to a rapid escalation in house prices, which was, in turn, a contributory factor to the stop being applied to economic expansion. In more recent years in England, the overhang of negative equity has been a feature in depressing consumer expenditure and has led to problems in the English economy.
The Minister might like to reflect on the fact that one reason why the Scottish economy has been performing marginally better than the English economy in the past few years has been that the balance of our housing stock is substantially different. That view was supported in a recent book by Gavin McCrone, the former Scottish Office economic adviser. There is substantial evidence of the advantage of having a balance between the public and private sector, so can it really be a good thing that the Minister with responsibility for housing recently said in Shelter's publication that it was his ambition to have no council houses at all in the whole of Scotland? That is an ideological ambition that bears no relation whatever to what is best for the economy, the housing stock or our people.
No country can rest easily on its wealth and opportunity while its people live in squalor. The SNP has a vision of Scotland--a Scotland of fresh walls and bright windows, a Scotland where homes are free of fungus and condensation, a Scotland where children do not wheeze and rattle. It is a grand vision, but, in a civilised country, it is no more than the people deserve.
Mr. Phil Gallie (Ayr):
One reason why Scots do not face negative equity is connected not with the balance between public and private sector but with their good sense. They did not go mad, as people did in the south-east of England some years ago, and pay massive sums for overvalued properties. Scots kept a balance and purchased at the right level. That is a great credit to all Scots and the fundamental reason why we do not have such problems in Scotland.
Ms Roseanna Cunningham (Perth and Kinross):
Does the hon. Gentleman suggest that ordinary people in England and Wales are more stupid than people in Scotland? That is what his comparison implies.
Mr. Gallie:
Three, four or five years ago, people in the south-east of England did not use sound judgment. I make no apologies for saying that. Opposition Members are pointing at my hon. Friend the Member for Southport(Mr. Banks). I know that their geography is a bit out, but Southport is certainly not in the south-east of England, on which area the problem centred. It affected not only the people but the housing industry, which became greedy and created long-term problems for itself.
The hon. Member for Banff and Buchan (Mr. Salmond) fails to recognise the massive change in Scotland in recent years. I give credit to the Scottish National party, which, supported by Conservatives between 1977 and 1979 in the jointly controlled Cunninghame district council, pushed ahead with the privatisation programme on council houses. We started the council house sale programme. That is a great credit to the Scottish nationalists and to the Conservatives. We stood out against the Labour party, which was burying its head in the sand. Happily, it has changed its attitudes recently.
There have been massive changes in housing schemes right across Scotland. There is massive investment, not from the public sector, but from private owners--from the individuals in the houses. Council house schemes that used to have an austere feeling about them and looked dull back in the 1960s and 1970s have undergone a massive turnaround. That says much for the Government's policy of selling council houses.
From 63 per cent. of houses being in public ownership, the figure is now about 39 per cent.--a massive turnaround. That is a great credit to Scots, across the board. It has met the dreams of many Scots who wanted to own their own properties. I hope that it will continue. The hon. Member for Banff and Buchan failed to recognise that massive investment. Apart from that, the Government have permitted investment in local authority housing. Some £1 billion will be pushed into local authority housing over the next three years, despite the massive reduction in the number of local authority houses. Since 1979, over £6 billion has been spent on local authority housing. That is a considerable investment,in which the Government can take considerable pride.
In addition, since the inception of Scottish Homes,an extra £2 billion has been put into public sector housing stock. That does not take account of the massive amounts of money from the Treasury and, above all, from taxpayers' pockets, via the housing benefit scheme.A heck of a lot of the cash that has been passed on to local authorities for council housing comes from the benefit scheme. Some 70 to 72 per cent. of local government revenue for local authority housing comes direct from the Treasury or through the benefits budget. That should not be overlooked.
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