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Mr. Tim Smith (Beaconsfield): As my hon. Friend's report says that the majority of the stock has been well maintained and is in generally good condition, surely the money will be directed to the 19 per cent. of properties that are in poor condition?
Mr. Colvin: I thank my hon. Friend for that intervention. That is true but there is bound to be an on-going demand. The money that has been promised will not go far to maintain and upgrade properties. I am sure that if his wife asked him for a new kitchen, she would not get one for £2,000.
The House and service families need to be reassured that the sale will have little or no immediate effect on service families' housing other than to improve it, and that the safeguards recently offered by the Ministry of Defence in the site exchange option scheme and the absence of any link between housing charges and the sale will be accepted universally.
Mr. Nicholas Winterton:
My hon. Friend heard the Secretary of State announce three specific proposals.
Mr. Colvin:
For a ghastly moment I thought that my hon. Friend had changed his mind or had second thoughts. I am glad that he used that opportunity only to endorse what he has already said, and I agree with him.
Whereas rents paid by service families will be fixed by the Armed Forces Pay Review Body, I remind the House that rents paid in future by the Ministry of Defence to the purchaser of the married quarters estate is, we have been told, likely to be calculated on an assured shorthold tenancy basis. If that is so, have Ministers modified their projections of the rent that they will have to pay to the purchaser in the medium term? The House needs to be assured that if the rent that the MOD pays the purchaser is increased, the Treasury will fund that amount for at least 25 years.
Any reader of our report will see that it raises as many questions as it answers. Until such time as the prospective purchasers' detailed proposals have been made public and assessed, we will not be in a position to reach a firm conclusion on the merits of the sale. Our Committee intends to re-examine this issue when all the necessary information is available.
Our Committee was very impressed by the quality of the evidence presented to us. Undoubtedly the star of our sessions was Mrs. Cherry Milne, the chairman of the Army Families Federation. But I should also say that, considering the sticky wicket on which he was batting, my hon. Friend the Minister of State for Defence Procurement carried his bat very well. I am pleased that he is in the Chamber today for a second innings.
Mr. Menzies Campbell (Fife, North-East):
If the speech of the Secretary of State had been set to music, certainly the early parts of it would have owed rather a lot to Vaughan Williams and to William Walton. As he came towards the end of his remarks, however, it was rather more reminiscent of the childhood ditty "10 Green Bottles". One after another, those who had so bravely held out before suddenly found themselves converted to his position, because of the nature of the concessions that he was able to make. If concessions on the proposals were necessary even in the course of this debate, they have been hardly indicative of the type of intellectual rigour that one would be entitled to expect--[Interruption.]
The hon. Member for Macclesfield (Mr. Winterton) makes a lot of noise. He is not always listened to, and he must ask himself why he has been particularly successful on this occasion. It is less than a week since he was talking about matters being obscene and wholly unwarranted--relating to the vital consideration of car mileage. Possibly he will be more successful when he adopts rather less dramatic language, and perhaps he will bear that in mind in future.
We would respect Ministers rather more if they were to come clean about the motive for this sale, because to argue that the motive is to improve conditions in married
quarters is disingenuous, and even offensive to intelligence. To argue that is to confuse objectives with consequences. Clearly, the motive is to reduce Government borrowing in the short term. As an objective taken on its own, it is highly desirable, but the question that we must ask ourselves is whether the price, in this case, is worth paying.
What has been the first cost of the proposal? It has been the peace of mind of service families. It is no use saying now, "We, the Government, will have to make a better case," because the damage has been done. It is no use saying now, "They do not understand the nature of the proposals." Whose fault is it that service families do not understand the nature of the proposals, particularly as the proposals--as we have just seen--change daily?
It is no use saying now, "We shall embark on an exercise of consultation." A very extensive consultation exercise was embarked on when the issue of homosexuality in the armed services was under consideration, and rightly so. Why was it that something that goes right to the heart and ethos of the armed services, such as the proposal to sell married quarters, was not subject in advance to that degree of consultation?
The proposal's complications are a clear sign of its weaknesses. The Select Committee on Defence was unable to reach a conclusion--as the hon. Member for Romsey and Waterside (Mr. Colvin), the Committee's Chairman, said--because of the absence of detailed proposals from prospective purchasers. That is bad enough for the Committee, but it is much worse for the families, who, in the absence of such information, are not themselves able to reach conclusions about the merits and advisability--or otherwise--of the proposals.
When I intervened on the Secretary of State, he described me as "petty". I shall not allow him an opportunity to withdraw that observation, as he allowed my fellow Defence Committee member, the hon. Member for Walsall, South (Mr. George), an opportunity to withdraw what he had to say about the service chiefs, but I shall repeat the point that I made to the Secretary of State: if the issue, ultimately, is arbitration, the Government cannot guarantee anything other than the strength of the case that they will make to the arbiter. There cannot be "guarantees"--in the strict sense of that word, or in the sense in which most service families understand it.
There is a financial price to be paid by the Ministry of Defence. Do not take my word for that, but take the word of The Times of 11 July 1996, which referred to
If a shortfall arises between the rental paid by service families to the Ministry of Defence and that which is required to be paid by the Government to the purchaser, where will the money for that shortfall be found? It will be found in the defence budget. Any undertaking or "guarantee" to a contrary effect is simply meaningless.
The proposal embraces the proposition that £100 million will be made available over five to seven years for improvements to the housing stock, to be
administered by the Defence Housing Executive. The executive already receives £40 million per year for that purpose. After five or seven years, however, what then? What benefit will service families receive from the sale then? It is not as if the £100 million will be a recurring figure; it is a once-and-for-all figure. Once it has been paid and spent, no doubt the Defence Housing Executive will be back to the same level of financial support for improvement that it currently enjoys.
Mr. Frank Cook:
I should like to explore the justification provided by the £100 million, as it seems to be the raison d'etre for the entire set of proposals. The fact is that 12,000 properties might be available. I do not know whether the hon. and learned Gentleman feels that £10,000 a unit would currently be an excessive price for a house on the market, but does he realise that 12,000 times £10,000 is £120 million, which would enable the Government to take the £100 million and to put the £20 million excess where it is probably going in any event--into Tory party funds?
Mr. Campbell:
I am not sure that I am in accord with the final part of the hon. Gentleman's proposal, but I certainly believe that he mentioned something interesting in his intervention. It anticipates a point that I had planned to make. There are 2,700 houses for immediate release. If he is right and they would command a figure of £10,000 each--which is a pretty low figure--that would release £27 million in the first year. However, if the figure were £40,000, for example, £108 million would be released, which is almost exactly the sum that will be made available over five to seven years to the Defence Housing Executive.
"the Government's short-term interests storing up a mess of trouble for the future"
and stated that, over 25 years, the Government, in return for £1.6 billion now, might pay out more than £10 billion. That should certainly focus our minds on whether this proposal is worth it.
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