HC Deb 05 November 1982 vol 31 cc221-86 9.35 am
The Secretary of State for the Home Department (Mr. William Whitelaw)

Almost a year ago, we debated Lord Scarman's report. That followed the serious urban disorders of 1981. This year our inner city streets have not been disfigured by serious violence on any scale. While many of the historic problems of our urban areas persist, my right hon. Friend the Secretary of State for the Environment is taking effective action to deal with them. He will cover those issues when he replies to the debate. But such efforts can be helped forward only if persistent criminality is tackled in our streets, if the police service is better equipped there for its job and if it has practical community support. I shall focus on those issues.

During the past year, my Department, the inspectorate of constabulary, chief officers and other ranks in the police service, police authorities of all political persuasions and many community representatives have worked together to produce results that range across the areas of difficulty identified in earlier debates—in handling public order, in crime prevention and effectiveness against crime, in training and in consultation with the community. I shall deal with each in turn.

I begin with public disorder because that is at the sharpest public focus of urban trouble. In a debate on 16 July 1981, I told the House that the chief officers who had been most closely involved were firmly of the view that their most effective approach lay in training their officers and developing their tactics for mobile and positive public order policing. That has been the theme of intensive work on arrangements for organisation, tactics, training and equipment for public order purposes during the past 15 months.

Early this year, the Association of Chief Police Officers adopted a smaller size for the police support unit—the basic unit of the mutual aid system. The smaller unit provides for greater mobility and more developed tactical deployment. As for personal equipment, some 20,000 protective helmets and 10,000 flame-resistant overalls are held by the police, rightly giving great confidence to the officers in positive tactics. With training, considerable attention has been paid to command and control, especially for the critical intermediate management ranks. Priority has also been given to the need to enhance the frequency and extent of public order training for junior ranks.

All that work is necessary, but it is not sufficient. My policy, and that of chief officers, places the emphasis firmly on prevention. But where reaction is necessary, it must be swift and efficient. Serious public disorder is not the routine that now faces the police, partly because of the great response that has been made in the light of the problems of 1981 and Lord Scarman's report. The most distressing problems in the cities are persistent crimes—burglary, mugging and vandalism. During the past year we have tackled those by reappraising and getting home the message. It is not peculiarly a police problem; it is the business of all those with responsibility in our inner cities.

In respect of street crime and burglary, police have been reassessing their methods and tactics. In parts of London they are combating street robbery by targeting police efforts based on improved intelligence in areas where the problems are especially severe. In the West Midlands, the problem of burglary is being tackled by concentrating police efforts on known high-risk areas. In the metropolitan area plans are in hand to launch a number of local initiatives against burglary.

Real action and real improvement in many of these areas have been made possible by the Government's decision on police manpower. The strength of the police service in England and Wales has grown by almost 9,000 under this Government to an all-time high of 120,323 at the end of September. The Metropolitan Police alone has increased by nearly 4,000, and will reach its establishment of 26,615 early next year. This has given the police the elbow room to make the long overdue return to patrolling on foot, on the beat, visible to the public. That is where people want to see them. That is happening: 300 in Manchester and 900 in London have been put back on the beat. In one of the four areas alone of the Metropolitan Police, a switch of resources together with an increase in strength, has enabled 48,000 more man days—a 23 per cent. increase—to be deployed on foot patrols.

Earlier this year, following discussions with my right hon. Friends the Secretaries of State for the Environment, Education and Science, and Social Services, I emphasised to the House that the task of reducing crime cannot be left to the police alone. The task calls for a concerted effort from central and local government, from the statutory and voluntary agencies and from the community as a whole. In central Government we have developed a coherent structure which enables Departments to work more effectively together. We have also for the first time brought together representatives of central and local government and of the police and voluntary organisations in a conference which considered how joint approaches can best be designed and a joint attack on crime can be most effectively made in areas where crime is most serious.

Much has already been achieved. A guide has been prepared for architects and planners to help them "design out crime" on housing estates and in private housing schemes. Materials on law and order have been prepared for use in secondary schools. This summer, a further £ 750,000 was spent on additional projects in the most deprived areas under the urban programme, in addition to the sum first allocated to holiday projects for young people. The educational welfare service, which is mainly concerned with reducing truancy, helps to keep schoolchildren away from opportunities for crime. We must also look to the youth service, which is closely involved with the voluntary organisations in our community and is well placed to help many children and young people who might otherwise turn to crime.

Looking ahead, local authorities have been asked to give priority to schemes that can help to reduce crime when submitting bids under the urban programme for 1983–84.

There are now schemes up and down the country—on housing estates, in high risk areas in inner cities—where local people are working with volunteers and the statutory agencies to tackle the problems of crime before crimes are committed, by providing protection for the elderly, occupation for young people out of school hours, advice to householders, and guidance to parents whose children may be at risk. They are working to restore the self-respect of their communities and to create a condition in which crime can no longer be thought of as an acceptable way of life. I pay tribute to all concerned in ventures of this kind, and especially to the volunteers who do so without payment and in their own time.

The lessons are clear. Crime can successfully be reduced through local initiatives by the people who live and work in the area. We shall continue to encourage and support their efforts.

Lord Scarman placed great emphasis on police training. So do I. The Police Training Council is now fully engaged on fashioning new approaches to training in public order, management and supervision, community and race relations, and probationers. It has now settled clear objectives for probationer training: first, a two-year "apprenticeship" with close supervision, and an integrated programme of central and force training spread throughout the period; second, the need to impart a greater range of techniques and skills, and develop personal qualities, specially directed at the problems of street duty; third, a thoroughgoing insistence on high ethical standards; fourth, a much greater emphasis on the fact that policing with consent means knowing fully about the problems of policing a multiracial society, and having an understanding of its diversity; and, finally, priority to be given to training in the prevention of disorder and the handling and defusing of potential conflict with the public.

I welcome and endorse that clear sense of direction. Results that flow from improved training take time to come through; that is only realistic. But the benefits are already being felt.

I am also heartened by the progress now being made in the recruitment of black and Asian police officers. The latest figure I have for England and Wales is 418, and the increase in London has been marked. Applications in London from the ethnic minorities more than doubled in the first six months of this year, and the number joining more than doubled. Chief officers and the staff associations have firmly and publicly set their face against any toleration of racially prejudiced or discriminatory behaviour in the service; and improved screening at selection stage and continuous assessment during initial training, with the Metropolitan Police in the lead, are being developed. In the light of this work on training and selection, and in view of the unanimous view of the Police Advisory Board, I am not persuaded that the case for imposing a specific disciplinary offence of racially prejudiced behaviour has been made out.

The events of 1981 drew attention to the fact that, especially in inner cities, our tradition of policing by consent needed to be supported by firm steps to improve consultation between police and community. As the House is aware, I straightaway set in hand a programme of discussions up and down the country, both to collect information about what had already been done and to provide guidance of good practice. The results of that work emerged in guidelines I published in June. I had earlier taken specific action in Lambeth. Throughout this year, both in London and elsewhere, local authorities, community representatives and the police have been, and are, setting up consultation arrangements to meet their local needs.

It was not, in my view, right to sit back and do nothing and simply wait for parliamentary time to legislate. It was more important to get things going on the ground, and thus reflect what people urgently wanted to do. The Bill I will bring forward will entrench in statute law the obligation of consultation between police and community. This provision will not, and must not, provide a straitjacket which ignores local reality and local wishes. It will underline the crucial importance of police and community working together to deal with crime and disorder.

The year 1982 has been a period of effective response to the policing problems of the inner city, and a period of action further to improve police service and community support. Events in Brixton earlier this week have given the debate special focus. They bear out, in my view, the reality of the achievement that has been made.

The police operation last Monday morning was in support of officers of the court in executing a writ of possession for nine properties. The local council had applied for the writ. The properties and the activities which they encouraged were a blot on local life, and the wish to be rid of them, and to redevelop the site, was shared by the local authority and the vast majority of local people. A clear policy of a fresh start was settled after lengthy discussion by council, community and police. It was no secret intent.

Throughout the day, the police and leading figures in the community worked patiently together in attempts to defuse tension and calm rumours created by a minority. The actions and motives of those people were as unrepresentative of true local interests and concern as they were wrong. But determined efforts to maintain calm and order failed; that was not the fault of the police. When property and officers were violently attacked, it was the clear duty of the police, in their responsibility to the community, as well as that to prevent crime, to move in in force. The operation was controlled, swift and effective and, in dispersing the crowd which had sought confrontation with the police, it prevented any repetition of disorder such as that experienced last year.

Those events were the results not merely of one element of the policies I have described, but of their full range. It was not a simple police success, but a success for the community as a whole. I want to express my thanks to the Lambeth community-police consultative group for its work, acting as a model of what the Bill will require. The group had spent months of careful and painstaking work, in consultation with local residents, and when disorder threatened on Monday members of the group, including hon. Members, were among those out on the streets seeking to head off trouble.

The Commissioner of Police of the Metropolis and I fully recognise the considerable public and parliamentary interest in the effectiveness of policing in London. In his opening statement, on taking up office, Sir Kenneth Newman outlined an approach with which I am in full accord. His approach and mine are about effectiveness and, therefore, results. He will be developing his plans, and reporting them to me in due course. I intend to ensure that the priorities for the police in London are fully debated, especially in the House.

Most of the results achieved and the progress still being made in London and elsewhere have not been dependent on legislation, but there comes a time when a further legislative step is required. The Bill which I propose to bring before the House shortly will, in important respects, carry forward the work that I have already outlined, so that the public can have greater confidence that the law will be enforced effectively, and with scupulous fairness.

The present arrangements governing the investigation of crime are inadequate. The Royal Commission exposed clearly the failings of the present law. It is riddled with anomalies. Much of it is out of date, and fails to match present social conditions. While much crime is sophisticated and organised, the police are expected to work within legal provisions some of which pre-date the formation of the CID. Some areas of the law are hopelessly vague, and others are hopelessly complicated.

There are also major gaps in the law, which hamper the effective detection and prosecution of criminals. The Government's proposals are designed to put all these matters right, and to provide an adequate legal framework within which the police can work. It is simply not good enough, as the Opposition have appeared to want to do, to resist the powerful case made out by the Royal Commission for modernisation and clarification of the law, and then complain about the way the police do their job.

The Bill, reflecting the extensive programme of consultation that has taken place over the past year, will confer additional powers on the police where they are needed and justified. Because there are gaps in the law, offenders are going free. But, at the same time, the Bill will provide additional safeguards for the individual, in areas in which the present law is too vague and where there is too much scope for allegations of misconduct which cannot readily be tested but are no less damaging for that. Powers for the police and additional safeguards for the individual go together. The more important it is to ensure that persons dealt with by the police are treated correctly, the more important it is that the rules under which the police are required to work are themselves clear and realistic.

The Bill will reform the police complaints procedure. The new arrangements we propose, in line with the Select Committee recommendations, will substitute for the present uniform procedure a three-tier system to operate according to the seriousness of the case. It will allow relatively minor matters to be dealt with locally by informal resolution; more substantial complaints will be investigated and independently considered as at present; and the more serious complaints will be investigated by a senior police officer normally from an outside force, under the supervision of an independent assessor, who for the first time will provide an independent element throughout the process of investigation. I believe that the new arrangements are important, and that they will help to reinforce good relationships between the police and the public.

I claim that the response both from the Government and the police which I have outlined today shows that when I welcomed Lord Scarman's report they were not empty words. We have taken substantial action in practice on police manpower, for police training, in public order, for crime prevention and for community support. Urban problems will not receive a realistic response if they are faced without an effective policy to tackle urban lawlessness. That is why I shall continue to pursue an approach which combines planned and vigorous law enforcement with consistently applied community contact and consultation. Each depends on the other. Our policies are clear and the Bill will advance them. Successful results are coming forward and we shall not be put off course.

9.56 am
Mr. Roy Hattersley (Birmingham, Sparkbrook)

At the very end of the Prime Minister's contribution to the Queen's Speech debate the day before yesterday, she devoted one-eighth of a single sentence to the issue of crime in our towns and cities and on our streets.

In the Prime Minister's final catch-all paragraph she promised, pursuing one of the military metaphors that she enjoys so much, a continuation of the "unrelenting war on crime". What she did not say, though it is tragically true, is that in the war on crime the criminal is now winning.

That appalling state of affairs was confirmed by the Home Office's own news release on criminal statistics—statistics which some of us might have thought would be the proper background for the debate. The Home Secretary did not draw to our attention those statistics of notifiable offences. His news release on how the war on crime is progressing said: the total number of notifiable offences recorded by the police in England and Wales in 1981 was just under 3 million, 10 per cent. more than the number recorded in 1980 and higher than in any previous year". The statistics available to us show that the present crime rate, at least for the last recorded year, is worse than at any time since statistics were kept. Every chief constable to whom I have spoken, including the Commissioner of Police of the Metropolis, believes that the situation has not improved in 1982, but that in terms of recorded crime there has been a further deterioration. That is the record of a Government who were elected on the crudest and most explicit law and order ticket. After three and a half years of a Government who were so elected, crime is at a record level in Great Britain.

Some of us are, therefore, not surprised that the Prime Minister could bring herself to offer only one-eighth of a single sentence on the subject. In May 1978, at the Conservative women's conference, she examined the whole issue in much more detail. She said: All over the country in our large urban areas old people go in fear and trembling. On Wednesday, four years after the Prime Minister described that unhappy state of affairs the Members who moved and seconded the motion on the Loyal Address offered the House oral evidence of how the Prime Minister had succeeded in bringing to an end the unhappy state of affairs that she described to those Conservative women four years ago. According to the right hon. Member for Bournemouth, West (Sir J. Eden), old people of Bournemouth are afraid to go out after dark". According to the hon. Member for Edinburgh, South (Mr. Ancram), the representative of suburban Edinburgh who seconded the motion, they are virtually prisoners in their homes after dark for fear of violence".—[Official Report, 3 November 1982; Vol. 31, c. 7–10.] Yet deterioration of conditions even in that salubrious part of the United Kingdom are even more extraordinary in the light of the Prime Minister to specific promise in Scotland. In a speech at Leith on 25 April 1979, she said: With a Conservative Government the maintenance of public order and the protection of law abiding citizens will be paramout.

If the Government have attempted to keep that promise, they have failed, when measured against the Prime Minister's own criteria. She went on to tell the Conservative ladies in 1978 the way in which crime could be reduced and prevented and the fashion in which the new Conservative Government would accomplish their promised success. She stated: The great deterrent to crime is the probability of getting caught. That is, of course, absolutely right. However, the Prime Minister—it must be recalled that she was speaking in 1978—went on to say that the probability of being caught had receded over the previous four years.

I wish that the Home Secretary had been able to bring himself to give the House the statistics on the possibility of getting caught and how these have moved since May 1979. I shall tell him. The detection rate is down. The clear-up rate is down. The prospects of anyone who has committed a crime getting caught are now 20 per cent. less than they were when the Conservative Government were elected.

Four years ago, when making her speech, the Prime Minister took some examples that are worth examining today. They included examples from London where, she said, the problem was worst and the dangers most acute. Only 21 out of every 100 offenders, according to the Prime Minister, were being caught and convicted. Today, in London, only 17 out of every 100 offenders are brought to court, let alone convicted when a prosecution is mounted. The conviction rate, far from being 21 per cent., is appreciably less than 17 per cent.

Some people argue that the reality may be that only five new offences out of every 100 in London result in successful prosecution. This is happening four years after the Conservative Government came to office with the Prime Minister saying: We are responsible for our times, and I am convinced that on law and order we can make things better.

Mr. David Ennals (Norwich, North)

Will my right hon. Friend accept that the problem exists not simply in London and the big cities? It is a problem in small county towns and villages throughout the country.

Mr. Hattersley

I accept without qualification what my right hon. Friend says. He will have noticed that the two examples of deterioration that I gave at the beginning of my speech concerned not the industrial cities and the old towns but what are traditionally thought to be the more salubrious and less crime-ridden parts of the country. The fact is that places which, four years ago, were thought of as being comparatively crime free are now crime prone. The point made by my right hon. Friend indicates the deterioration that has been witnessed since 1979.

I was saying that the Prime Minister told the country four years ago: We are responsible for our times, and I am convinced that we can make things better. I repeat that crime has got enormously worse.

The Home Secretary seems wholly unwilling to share the view expressed by the Prime Minister four years ago that the crime rate is the responsibility of the Government. The right hon. Gentleman talks as if crime is going on around him in a way that he cannot control and cannot influence. It is the entire technique of the Government to extract credit for those things that happen to be good and to deny all responsibility for those that are bad. The Chancellor of the Exchequer says that the inflation rate has come down and that he is responsible but that the unemployment rate has gone up and the Conservatives have no responsibility.

I hope to try to convince the Home Secretary that he has some responsibility in these matters. That responsibility is hardly met by the sort of promises he made today. What has he told the House in the face of the increasing crime rate? The right hon. Gentleman says that the police are "reassessing their methods and tactics" and that plans are in hand to launch a number of local initiatives. Some of us might have thought that over three-and-a-half years he would have moved further. The Home Secretary is happy to be the man who presides over the recruitment of more police. He will not accept the simple fact that he is also the Home Secretary who presides over the worst increase in crime in the history of this country.

In terms of crimes committed and crimes solved, the right hon. Gentleman is the most unsuccessful Home Secretary that this country has ever had. He may continue to say—pathetically, in my view—that this is not his fault. That was not his view four years ago. I think I heard the Home Secretary say that it was his fault.

Mr. Whitelaw

No, I did not say that.

Mr. Hattersley

It is not clear to me, although it is perhaps to him, what the Home Secretary is saying. I make the point that it is entirely his responsibility. The right hon. Gentleman made his view clear four years ago when he sat on the Opposition Benches. At that time he was continually telling the Government of the day that the deterioration in the crime rate and the detection rate was entirely their responsibility. I shall remind the right hon. Gentleman of what he said in April 1978—in Lambeth of all places: A Conservative Government under Mrs. Thatcher has positive policies to deal with the criminal in a really effective manner. The right hon. Gentleman was saying that the Conservatives had positive policies ready four years ago to deal effectively with criminals. Today those policies have turned into a reassessment of methods and tactics and plans … in hand to launch a number of local initiatives". Following his promise in the Lambeth speech that the Conservatives had positive policies which would be put into operation at once, the right hon. Gentleman said a month later: The failure of the Labour Government to act with resolution and stop crime is one of the major blots on its record.

If that was a blot on our record I do not think that there is a noun to describe the extension of that blot over the past four years. We are entitled to ask the Home Secretary what went wrong. We were promised so often under a Conservative Government that things would get better. Why did they get dramatically worse? The Home Secretary has not attempted to answer that question today. Nor did he attempt to answer it in a debate on the same subject six months ago. With your agreement, Mr. Deputy Speaker, I should like to fill the vacuum.

First and foremost, the increase in unemployment for which the Government have direct and intentional responsibility has been a major cause of the increase in crime in this country. When he was in Opposition, the Home Secretary actually believed that. The right hon. Gentleman said that he believed that crime and unemployment statistics were directly correlated. He said: There has been a dramatic rise in unemployment among boys and girls. That is the responsibility of this Government. Let no one have any doubt about the danger that that has created in terms of crime of all sorts, violence and vandalism".—[Official Report, 27 February 1978, Vol. 945, c. 40.]

It does no credit to the right hon. Gentleman if that is not now his opinion. If it is still his opinion, it is a formidable indictment of the Government in which he serves. The increase in unemployment is the main reason for the increase in crime in this country. Until that increase is reversed, the crime crisis will continue.

Another factor is the undoubted effect of the physical deterioration of living conditions in the old industrial towns and inner cities and, as my right hon. Friend the Member for Norwich, North (Mr. Ennals) has remarked, in many other parts of the country. If my right hon. Friend the Member for Manchester, Ardwick (Mr. Kaufman) is lucky enough to catch your eye, Mr. Deputy Speaker, before the end of the debate he will develop the description of the deteriorating physical environment, the reduction in amenities and the increasing deprivation which has contributed to the crime level.

Neither he nor I suggest for a moment that the deterioration began three-and-a-half years ago. We do, however, insist—I have no doubt that my right hon. Friend will demonstrate this—that it has cruelly deteriorated over the past three-and-a-half years largely as a result of the Government's attack on local authority spending. In fact, the Government have created conditions which breed criminals and crime. Nowhere, I fear, is that more true or more apparent than in London—here in the metropolis, where the rise in crime is greatest and where the campaign against crime is the least successful.

The Home Secretary is directly and absolutely responsible for crime in London. He is, or claims to be, the police authority for the Metropolis, which is, I repeat, the area where crime rates rise most quickly and where the crime clear-up rate is worst. Yet the right hon. Gentleman's constant contribution to the debate about crime in London is the stubborn refusal to consider any radical ways in which the condition might be improved. Whether he is discussing Operation Countryman, the Brixton disorders or the general question of control and organisation, the Home Secretary's initial response is to refute every criticism, negative and positive.

This "Boys' Own" view of loyalty may be enormously impressive in Cumberland, but it is no comfort in Brixton, Lambeth, Camden and Peckham, where there is an urgent need to make the Metropolitan Police more effective. A radical reorganisation has to come about, and one day it will come about. In the meantime, there are other improvements which I hope are coming. But the Home Secretary can take hardly any of the credit, if any at all, for those improvements, when they come.

I had the good fortune two weeks ago to meet the new commissioner and to discuss with him the prospects for his period in charge of the Metropolitan Police. The new commissioner described himself as not being "squad happy". By that, he meant that he preferred police visible on the beats rather than in specialised, quick reaction cadres ready to pounce on single crimes in particular areas and not generally available for the comfort, support and protection of the population at large.

The Labour Party has been saying that for years, and the Home Secretary has regarded the prospects that we have offered of making the police in general and London's police in particular more visible as just a manifestation of our wish to control the police in some political measure.

What has to happen now is that the police have to respond to the needs and wishes of the people whom it is their duty to protect. I have no doubt that if the police, especially the police in London, had been under the strategic control of elected police authorities which reflected and represented the views of the people, the police would have been back on the beat years ago. We would not have needed a new commissioner to announce, rightly and properly, that he was not "squad happy" but wanted to get the police back on the beat. Previous commissioners would have been told by the elected authorities that they should not be "squad happy" and should organise London's police in different ways.

I welcome at least that part of the right hon. Gentleman's speech. I believe that the police must became closer to the people whom they serve and protect. I welcome what the Home Secretary said about policing by consent. I welcome the arrangements for local consultation. I welcome the proposals for improved training. Certainly I welcome what has happened about recruitment, especially the increase in numbers recruited from members of the ethnic minorities who, I hope, understand increasingly that the police can and should be their friends and that they should work with the police as closely as possible. But the truth is that it will be a long time before the unhappy trend over the past 15 years is reversed, because we have seen 15 years during which the police have become more and more remote from the people. That is partly because of their organisation and it is partly because of the duties required of them. My fear now is that the new police Bill, instead of bringing the police and the public back together, will further alienate the police from the public whom they serve.

I was astonished that the Home Secretary did not take the opportunity—I thought that this was what such debates were intended to provide—to describe in some detail the contents of the new police Bill. Does he intend to introduce a legalised system of stop and search throughout the United Kingdom? Does he intend to introduce the opportunity for the police to hold suspects without charge for 96 hours? If those are his intentions, I hope that he will understand that the only result can be a further alienation of the police from the public.

It is not simply a matter of how these measures will affect the inner cities, the boroughs and the rundown central areas. It is how they will affect even more prosperous parts of the country. I look round the Chamber and I see many right hon. and hon. Members, some of whom are in their places today, who, if they were stopped—I choose an example at random—in Louth and told by the police that it was proposed to search them and their cars and to require them to explain what they were doing, where they were going and why, would not feel any more close to the police than they did the day before they were stopped and searched. At a time when we want to bring the police and the public back together, the idea that we should contemplate the introduction of such measures seems to be a destructive move in the wrong direction.

All those criticisms will be advanced by the Opposition when we come to the Second Reading of the long promised, long awaited and extremely leaked Bill.

Mr. Ronald W. Brown (Hackney, South and Shoreditch)

I am sure that the right hon. Gentleman appreciates that in London section 66 of the Police Act gives the police the right to stop and search. We already have it.

Mr. Hattersley

Yes, I understand that, and the Royal Commission on criminal procedures said that the power existed in London, where it was operated legally, but that it operated sometimes outside London, where the power did not exist, illegally, so it should be made legal throughout the country. I find the logic of that contention extremely difficult to follow, and I hope that the Home Secretary will explain the logic behind his proposal, if it is his proposal, to extend what I regard as an unhappy state of affairs in London to other parts of the country.

What we know the right hon. Gentleman will do when he introduces the Bill—and no doubt many times before—is to make the one great claim concerning the police and crime which the Conservative Party repeats day after day. It is that under the Conservative Government police numbers have increased and that they have increased because of the pay award for which the Government claim responsibility. We ought to put that in context and get the position clear.

First, the pay award is the result of the Edmund-Davies proposals. That committee was set up by a Labour Government. Its report was accepted by the Labour Government. The Labour Government wanted to stage the first part of the increase. But the hard facts are that under either scheme—the staged scheme or the scheme which was introduced—for the last two years, police pay and consequently recruitment would have been exactly the same. The one factor which makes the Government seem generous about police pay is that they honoured that one commitment that they had inherited from the previous Government but they repudiated all the other public sector agreements and therefore claimed a preference for the police because they picked out that one sector to fulfil their responsibilities.

The Government's repudiation of and failure to endorse agreements made by the Labour Government has itself an effect on the crime rate. I give one example. In Birmingham, where a responsible and successful police authority works in close co-operation with a wise and prudent chief constable, police numbers have increased as a result of the new pay award. But in the inner city of Birmingham, two other factors are emerging. Thanks directly to Government policy, five Department of Health and Social Security offices are closed, leaving the poor and unemployed without their benefit. Thanks directly to Government policy, the local department of social services is in crisis and is not providing its usual level of care and supervision.

That in itself has an effect on the crime rate. The Home Secretary must understand that, if he increases deprivation and social and material suffering, that in itself will produce the result that he and the Prime Minister promised would not come about.

Finally, I say this about the attitude of those of us on the Labour Benches in the months that lie ahead. There is a strange paradox amongst Conservative Members and in some Conservative newspapers about law and order and crime. If a Tory Opposition criticise the operation of the police and call for more effective policing, it is called patriotism. If a Labour Opposition criticise the operation of the police and call for effective policing, it is called anarchy.

I make it clear to the Home Secretary that the Labour Party proposes to continue its demands that he and the Prime Minister attempt to keep their promises and that Britain's crime rate be reduced. Not least we propose to do that because it is the people whom we represent who suffer most.

I well recall the police programme about the Thames Valley authority in which we saw 17 policemen protecting the home of the Dowager Duchess of Marlborough against the prospect of a jewellery raid. There were 17 policemen and Sir Arthur Bryant, who some think is a deterrent in himself. I am sure that many Labour Members look forward with delight to the day when there are 17 policemen visible and available in their entire constituencies, not 17 policemen in one house.

The Labour Party's concern is for those people on whom the crime rate increase falls most heavily—the old lady on the council estate, attacked on her way home from bingo, and the unemployed family whose gas meter is robbed. Those are the people who do not possess the resources to recover from their injuries and deprivation. Yet under the Government the risks that they face have scandalously increased. In the short term we propose to speak up for them. After the election we shall act on their behalf.

10.21 am
Mr. Neil Thorne (Ilford, South)

I have listened with great interest to the opening speeches on the important matter of law and order. However, we are dealing this morning with the urban environment in its broader context as well. I wish to intervene only briefly to raise an important matter. I am delighted to hear that the Government are proposing a revision of the building byelaw regulations and their implementation.

My right hon. Friend the Secretary of State for the Environment will be aware of my close interest in the problems associated with urea formaldehyde foam. There are a substantial number of properties in Britain which have had their cavities filled with that foam without apparent difficulty or danger. However, that, I am sad to say, is not universal. Either the present regulations or their implementation are wholly inadequate.

Urea formaldehyde is present in many substances in daily use. I understand that it is present in bread and is given off by the human body. However, when it is mixed with a foam to fill building cavities, additional properties are created. Because of that, people who inhabit such buildings can suffer considerable discomfort. Research that has been carried out on animals is wholly inadequate and we do not understand fully the effects of urea formaldehyde foam when it is used as a cavity filler.

There are schools and old people's homes—for example, Hyleford old people's home in my constituency—where considerable suffering has been caused to the staff. I understand that a school in Southend is still uninhabited by teachers and children several months after the installation of such foam. The time is now well past when we should take a serious look at the issue to ensure that adequate research is carried out to reassure those who are affected that no lasting damage to their health is likely. We should look closely at the building regulations, and I urge my right hon. Friend to do so without delay.

10.24 am
Mr. John Parker (Dagenham)

There is one important omission from the Gracious Speech. The Law Commission published a discussion paper on family law in October 1980 and, on 14 December 1981, published a response and recommendations on family law. The normal reaction to such reports is for the Government to introduce legislation in the next Session. However, there is no such legislation proposed in this Session. Why not?

There was much press speculation before the Gracious Speech to the effect that the Prime Minister was afraid of upsetting the powerful women's lobby during the lead-up to the general election.

Early legislation is urgently needed to provide some solutions to the problems resulting from the various changes in the divorce law. I have long been a supporter of easier divorce. As long ago as 1937 I supported Alan Herbert's Matrimonial Causes Bill. There was an enormous battle to make that law. Supporters on both sides of the House had to be organised as though they were a party in themselves, with their Whips, to carry through the necessary closure of votes to get that Bill. I also supported the 1969 Divorce Reform Bill which made such important changes in divorce law. Proposals are now coming forward for further changes in divorce law to enable a marriage to be ended after a year if it has broken down.

The result of all those changes needs to be fully considered, especially those concerning the children. There has been a large increase in marriages in Britain since Victorian times. People remember the large families of Victorian times but they do not remember the many unmarried people then. Many bachelors whose careers had taken them abroad came home too settled in their ways to get married. There were also a large number of spinsters—partly because men tended to emigrate more than women—who came from middle and working class families. That position has largely changed now. It is difficult to find large numbers of unmarried people. Most have been married at some time or another or intend to marry.

There has recently been not only an enormous increase in legal marriages in Britain but a growth in common law marriages. That is a European-wide phenomenon, particularly extensive in Sweden. However, it does not seem to have affected the number of legal marriages taking place. The result of such changes is an increase in the number of illegitimate children. Changes in the legal position of the illegitimate have taken place and removed most of the discrimination against them with regard to property. However, the stigma still remains an import ant factor.

The main changes that have taken place in divorce law are that the matrimonial offence has been replaced by the breakdown of marriage as the main reason for divorce. However, following that change, insufficient attention has been given to the care of children and that must be looked at.

I speak as a long supporter of the former Unmarried Mother and Child Council, now the One Parent Family Council. I was a sponsor of Dame Joan Vickers's Maintenance Order Bill. My Legitimacy Act of 1959 enabled all children to be legitimised on the subsequent marriage of their parents.

At present, with the increase in divorce, 60 per cent. of all divorces involve children under the age of 16. With the change in the law, there has been a great increase in the number of divorces. In 1914, for the first time, the number of divorces exceeded 1,000. By 1942, the number had risen to 10,000. A great increase took place during, and immediately after, the Second World War. In 1971, following the 1969 Act, there were 110,000 divorces, and in 1979 there were 162,000 divorces. Now, once again, the number seems to be increasing. As a result of the increase in the number of divorces, there is an increase in the number of second marriages. In 1977, there were 119,000 second marriages. That shows that, despite the increase in the number of divorces, the majority of people like marriage and want to remarry if the first marriage has failed.

The financial arrangements following a divorce were based under the old system on the type of divorce, and so on. It was assumed that there was a marriage contract and that a woman was entitled to be maintained if the marriage ended. Both parties tended to seek to be as well off after the divorce as they were when married. Sometimes they argued that they should be at least as well off as they would be if they had not married. However, when a marriage breaks down, it is impossible to base any financial arrangement on either of these assumptions.

Before the Second World War, the majority of divorces in Britain took place among a section of the middle classes. Alimony was one of the most important subjects of discussion, along with the division of property, the allocation of the man's income, and so on. However, there has now been a complete change in the spread of divorce. It has become a common feature of working-class families. I know that, in particular, from my constituency. Many tragedies follow that great spread in the frequency of divorce. The reason is that women will not stand being knocked about by a man and they naturally then seek an end to their marriages. The spread of divorce into all the different social classes means that the maintenance order system is completely out of date and no longer satisfactory. We have no precise information on how the maintenance order system works. There are no figures on how much is paid annually or to whom it is paid.

The Home Office has not taken any steps to improve information on this important aspect. Many wives find it difficult to extract maintenance order money, particularly at this time of inflation. It is difficult to have one's grant increased as a result of inflation. Usually, one of the partners—often the wife—has to collect some form of social security to reinforce her position, even if she is earning and receiving child benefit. The whole position is most unsatisfactory.

As a result of the system, wives of the second marriage often hate the wives of the first marriage because the amount of money available to the second marriage is reduced by the need to pay maintenance. Consequently, many second marriages go on the rocks. The vast majority of men find it impossible to support two families at the same time. Many husbands hate their first wives and refuse to pay maintenance because of the demands that are made. Indeed, in 1978, 2,439 men preferred to go to gaol than to pay their wives anything, so great was their hatred.

Maintenance orders should be replaced by a one-parent family grant for all women with children of school age or under. It should be a grant similar to that paid to widows with children. The difference between a one-parent family with a widow and a one-parent family without a widow should be ended. As a result of those changes, there would be a great increase in human happiness. The cost of the present system is not known, but the abolition of the maintenance order system would lead to a considerable saving in the cost of law enforcement.

In addition, the present social security payments and child benefits mean that many women receive some money, although it is often inadequate, after their marriages have ended. Such figures as we have show that 61 per cent. receive some income from that source. However, at least 32 per cent. appear to go out to work, despite the fact that they have dependent children. A considerable saving could also be made if we no longer imprisoned those 2,439 men. If the maintenance order system were abolished, the second families would be better off and, in turn, there would be more revenue coming in because the second families would be on a more stable basis.

The Government should consider several other problems. For example, when the matrimonial home breaks up, the house may be allocated to one of the parties. However, if there is a mortgage and the house has to be sold, it is often difficult to reach a satisfactory settlement. In the Barking area, we give all council tenancies jointly to husband and wife. In the case of older tenancies they can be transferred to both partners. In the case of a separation or divorce, the council normally allocates the house to the partner who keeps the children. Such is the practice of many councils.

In my experience, there is a considerable problem in families with teenage children. If teenage children, particularly sons, support the mother, the father often has to leave the home. It is then difficult to find the father alternative accommodation and that creates a considerable problem. If the maintenance order system were abolished, the situation for middle-class families who own property and must divide it would not be more difficult than it is at present. Why have not the Government proposed legislation to deal with such problems? Is it true that there is opposition from women's pressure groups, as the press suggest? It is doubtful, but that should not be any deterrent to the Government. However, there is a danger of a male reaction against some of the activities of feminist groups, and of a reaction from the wives of second marriages. Remarriage is now common. Within four and a half years, at least 55.5 per cent. of men and 48 per cent. of women remarry. Therefore, it is important to stabilise second marriages.

The Law Commission should examine yet another problem that perturbs many young men. A man may live with a woman on the understanding that they have no children. However, the woman can change her mind, fail to take the pill and subsequently have a child, which the man will then have to maintain. Such cases should be treated as one-parent families.

The custody of children needs to be considered in greater detail. The best interests of the child should always predominate. My 1959 Act provided that the custody of an illegitimate child should be given to the father rather than the mother if that was in the child's best interests. That has worked fairly well but needs to be re-examined.

One of the main reasons for that provision was that if a white woman lived with a coloured man and produced a coloured child and then deserted that child, the child would usually be put in the custody of the local authority. It is now possible for the father to be given custody if that is thought to be in the child's best interests.

A difficult case has occurred in my constituency. A woman walked out on her husband and a boy of 3. The child was brought up by the husband and his parents until he was 11. The man then went to live with a divorced woman who had children of about the same age. They decided to marry and establish their family on a legal basis. When the man sought a divorce from his wife she demanded the custody of the 11-year-old boy, although she had had no contact with him since he was 3. The man's solicitor discovered that the custody case was to be heard by a woman judge. He said to the man "We can do nothing because the woman judge always gives custody to the mother." No attempt was made to fight the case and the mother was given custody of the child. The father then asked the Law Society to take action against the solicitor for not fighting the case energetically. If a woman deserts her child she should have no claim on him later.

Changes in the divorce law have created enormous problems. It is now mainly a working-class problem rather than a middle-class problem. The law should be brought up to date to deal with the new problems. The good news is that the Government have set up a committee to examine conciliation procedures. Efforts to help restore marriages should be encouraged. May we have more information about the progress of that investigation?

I ask the Government to consider introducing urgent legislation to deal with the problems created by changes in the divorce law, and particularly to deal with children who are affected by the break-up of a marriage.

10.43 am
Rev. Ian Paisley (Antrim, North)

As a representative from Northern Ireland, I find it difficult to decide when to take part in the debate. I could not speak on foreign affairs yesterday because Northern Ireland is not a foreign country, although some hon. Members seem to think that it is. Today's debate is about home affairs and, as Northern Ireland is part of the United Kingdom, it is appropriate for me to take part. The Home Secretary was once Secretary of State for Northern Ireland and I trust that he will have some sympathy with what I say.

For the past 12 years Northern Ireland has had to live with continual violence. That violence will become even worse if steps are not taken to deal with it. The kidnapping and murder of UDR Sergeant Thomas Cochran and the barbaric and hideous murder of an innocent Roman Catholic father who was savagely beaten to death by so-called loyalists in retaliation foreshadows even darker things to come.

Appeals to those who commit such murders are in vain. There was a time when appeals were heeded by both sides of the community. I remember an incident some years ago when a police officer was kidnapped on the border and done to death by the IRA. In retaliation, some Protestants kidnapped a Roman Catholic priest. I made an appeal for the release of Mr. Murphy and he was released. Those responsible have since been made amenable to the law. Appeals today in Northern Ireland, even from the hierachy of the Roman Catholic Church to the IRA and from Protestant leaders to so-called loyalist groups are in vain. Those who perpetrate such crimes are deaf to any plea for reason, sanity or humanity. That is a sad fact.

Murders are nothing new in Northern Ireland. On the blood-stained pages of the last 12 years murder is common. The press here has tried to make out a case that the spate of murders is occurring because of the Assembly elections. If one looks back one can see that the murders occur whenever there is any political initiative. They will continue if steps are not taken.

I listened to the Home Secretary talking about the forces of law and order in this part of the United Kingdom and the increase in police recruitment. Alas, that does not apply in Northern Ireland. The part-time women police section in the RUC reserves is almost disbanded. The women have done signal service by releasing male officers for other duties. They are now told that they are no longer required. In my area they have been told that they can keep their uniforms for a year, but eventually they will be called in. It is a crying shame that those who have been prepared to serve the community at the risk of their lives are being treated in such a terrible way.

The hours of work by part-time male reservists have been slashed. Overtime by full-time members of the RUC has been cut. The same is happening in the UDR. Part-time UDR reservists have been laid off or their hours have been cut. Many bases from which they operate have been closed throughout the Province. One would think that that would not happen in view of the troubles in Northern Ireland. My pleas, and the pleas by my colleagues to the Northern Ireland Office have been in vain. Much money was made available by the Government to defend the Falkland Islands. I agreed with their policy wholeheartedly. It is no excuse to say that expenditure on the defence of 1½ million people who live in part of the United Kingdom has to be cut because of lack of funds.

Elections by the democratic process are a matter for the people who cast their votes and exercise their franchise. The House may not like the election results in Northern Ireland, but as democrats they must accept them. It came as no surprise to those who know Northern Ireland that Sinn Fein made sizeable gains in the last election.

Two Sinn Feiners were returned to the House over and over again from Fermanagh and South Tyrone and Mid-Ulster. Indeed, the present Member for Fermanagh and South Tyrone (Mr. Carron) is a member of the Sinn Fein. It came as no surprise that Sinn Fein gained 10 per cent. of the vote. When the first Stormont Parliament was set up the same number of Sinn Feiners were returned, one of them being Mr. de Valera who subsequently became Prime Minister of the Republic and who sat for Down, South. The vast majority of the Protestant electorate regrets that the SDLP has opted out of the democratic process. Its leader's stand for a united Ireland or nothing was repugnant to all Unionist voters. However, their seats and their proportion of chairmanships and vice-chairmanships remain and I trust that the SDLP will have second thoughts and once more concern itself with the democratic process.

I have read in the press that, as Mr. Haughey has fallen and there is a chance of Dr. FitzGerald returning as Prime Minister for the South of Ireland, things will now change. Nothing could be further from the truth, because Dr. FitzGerald has the same objective as Mr. Haughey—a united Ireland. I told the House that there would be an overwhelming vote in the Assembly elections for the Union, and it was the largest vote for the Union since 1920.

As leader of the second largest party in the new Assembly, may I say that my party is dedicated to making it work. With imagination, dedication and energy we shall put all our talents into producing devolved government in Northern Ireland. We intend that stage one of the Assembly will work and we hope that on 11 November a presiding officer and a rules committee will be elected and that the Assembly can get down to the real business of proving to the House that some people in Northern Ireland are concerned not only with the constitution but with the bread and butter issues that are of prime importance to our people.

Northern Ireland is the worst black spot Of unemployment in the United Kingdom. When I first came to the House, unemployment in North Antrim was 4 per cent. Now it is 16 per cent., but that is one of the better areas. In some areas almost 50 per cent. of the male population is unemployed. I received a letter recently from the vehicle building and automotive group of the Amalgamated Transport and General Workers' Union of Northern Ireland that highlights the position there. The secretary says: In the last six months alone almost one-third of our membership have been made redundant. Many more are on short-time working. That is the dark shadow of unemployment that lies across our Province. The secretary continues: Several factors have contributed to this extremely grave situation, the most significant being the importation of vehicles from the South of Ireland. This has created an unfair system of competition as those cars brought across the Border are not liable to the same taxation system as those being sold legitimately in the North. This has resulted in many distributors being forced to shed labour in an attempt to reduce overheads to compete with these imports. The secretary went on to emphasise the necessity of the Government ensuring that a quota system is introduced to prevent the Northern Ireland market being flooded by such cheap imports. The Government should press in the Common Market that the present purchase tax and VAT on vehicles within the EEC should be regularised and that manufacturers be encouraged to narrow their differentials. I agree with those proposals. The Gracious Speech said In Northern Ireland, my Government remain determined to create the conditions for a peaceful and prosperous society. The prime condition for such a society is to ensure that its members are employed usefully.

Another great worry of the people of Northern Ireland is the proposal to hand over the telephone services to private enterprise. In the outlying areas of Northern Ireland, the only lifeline of some elderly people is the telephone. Private enterprise will be more interested in obtaining a return from its investment, than in supplying a service, and those areas will be penalised. I oppose that.

It will come as no surprise to the House to learn that I regret that the Government will give a fair wind to a Private Bill that allows the opening of shops on Sunday. I hope that the Government will respect local opinion on such matters and that the Assembly will have an opportunity to discuss the matter and to offer its opinion before an Act is passed in the House.

10.55 am
Ms. Harriet Harman (Peckham)

I know that hon. Members sadly miss Harry Lamborn, who died this summer. It is a great privilege to represent the people of Peckham, but I regret that I have come here as result of a by-election following Harry Lamborn's death. I should have preferred to come here after a general election, knowing that he and his wife Lil were enjoying a well-earned retirement. Harry will be long remembered in Peckham not only for the 10 years that he served in the House as Member of Parliament but for the many years before that when he was a Southwark councillor. His contribution to the area is warmly remembered and he will be sadly missed.

Peckham is not faring well under the Government's policies. Since 1979 unemployment has more than doubled and more than 80 young people chase each job at the Peckham careers office. More than 9,000 families are on the housing waiting list, at a time when more than 1,000 skilled building workers are on the dole and the council owns land on which it would build but for the fact that Government cuts have almost put an end to new council building.

For those in council homes—nearly 80 per cent. of homes in Southwark are rented from the council—the Government have forced up rents and plan to do so again. Under the Government's housing policy, the home owner in Chelsea receives nearly twice as much public subsidy as the council tenant in Peckham. Despite the fact that rents are increasing, repairs take much longer because of cuts in the budget for major maintenance. I am not talking simply about a lick of paint; I am talking about major maintenance and vital repairs. Living standards for those in work are falling.

I wish to mention the case of one constituent. I should not call her a "case" but, unfortunately, she is a welfare case. She works a six-day week for 47½ hours in the catering department of St. Thomas's hospital. She receives only £58 take-home pay and her rent is £45 a week. That is why she is a welfare case. It is a scandal that someone who works so hard in the public service must fight her way through a web of rent and rate rebates just to be able to live. For the increasing number of those who are out of work, living standards are falling even faster and their lot is to stand around on street corners with nothing to do.

Vital public services have been hit badly. Southwark council can provide only about 500 nursery places for the borough's 13,500 under-fives. Even when the Inner London Education Authority has the money to build schools and provide nursery places it is not allowed to do so. The Government prevent ILEA from providing more nursery places.

The Government are directly responsible for something which people in Peckham are extremely concerned about, and that is the increase in crime. We do not know very much about the causes of crime, but we know that as youth unemployment increases so juvenile crime increases. Therefore, the Government's responsibility for directly increasing unemployment, especially among young people, gives them a direct responsibility for the increase in juvenile crime. This is not to excuse crime, but if we are to solve the problem we must understand its causes and tackle them.

We know also—Government reports have borne this out—that dark corners of rundown ill-lit estates attract muggers and vandalism. The Government's cuts in housing have a direct effect on crime in our inner cities.

Increasing the powers of the police, especially their powers randomly to stop and search—it seems that what the Government will be providing in their police Bill will amount to random stop and search—will do nothing to attack the causes of crime. However, what it will do—and we know this to be so—is to strain further the relations between the police and the public. It will alienate further the police from the public they are supposed to serve and make it harder for the police to do their job. If the Government are serious about wanting to improve the relationship between the police and the public, they should bring London's police under the control of locally and democratically elected people. Statutory consultation will not do. The police will consult, but having done so they can and will be able to go their own way.

The effect of Government policies on Peckham is no accident. It is not the effect of the mismanagement of a Government who have got their sums wrong but the politics of inequality. There is no need for the tragic waste of talent of the young person in Peckham who would make an excellent electrician or carpenter but who cannot find an apprenticeship, let alone a job. There is no need for people to remain homeless while building workers are on the dole and while land becomes a blight because it is empty and becomes an eyesore. There is no need for pensioners to go to bed halfway through the afternoon as the winter approaches because they cannot afford to pay their heating bills, let alone the standing charges. There is no need for young mothers to become depressed as they struggle to bring up children in small flats with no nursery facilities and no play facilities in the area.

There is no need for any of that because we are a wealthy nation. We are rich in oil and natural gas and rich in the skills of the work force. But we must plan to use this wealth to put people back to work, to build homes and hospitals and to provide the schools and services that millions need. We must increase the wages of the low paid to stop the gulf of inequality that is opening up and to put spending power back in people's pockets to regenerate the economy. During the recent by-election some reports painted Peckham as little better than a dump. It is not a dump, and such reports and such descriptions have been deeply offensive to the people of Peckham, who are struggling to make their area a decent place in which to live, to work and to bring up their children. This Government are making that struggle much harder.

The Government have taken to talking about "the inner city problem". They point to places such as Peckham and talk about "this problem". That is completely the wrong way round. The Government do not have an inner city problem; but the inner cities have a Government problem. It is not the people of Peckham who are the problem. The problem lies with those on the Government Benches who are deciding Government policies. It is about time that we stopped criticising the inner city areas and started criticising the Government.

11.5 am

Mrs. Shirley Williams (Crosby)

I congratulate the hon. Member for Peckham (Ms. Harman) on her maiden speech. She follows a great tradition in the House. Harry Lamborn was much respected and admired in the House. I think that his predecessor, Freda Corbett, also won the admiration of many hon. Members on both sides of the House. It is a pleasure to see someone who is already distinguished as the new Member for Peckham. We recall the hon. Lady's rather famous battle over the contempt of court laws. Many of us in the House believe that those laws sometimes operate in a way that makes it difficult for us to have as much freedom of information in our society as we wish. We all recognise the role that the hon. Lady played in that battle.

It is an especial delight to see a forceful and eloquent addition to the small ranks of women Members. The hon. Lady will discover when she is a mother that the House makes few concessions to those who have young children. I believe that, with all women Members on both sides of the House, she will become a champion of those who wish to see this distinguished institution changed to enable more women to join its ranks and to have a more representative assembly.

The hon. Lady referred to the levels of unemployment in Peckham and to their link with crime. The right hon. Member for Birmingham, Sparkwood (Mr. Hattersley), while placing major responsibility on the Home Secretary for the rising levels of crime, let off rather lightly the rest of the Government. Government Departments rarely recognise the responsibility of other Departments for the inner cities. The Home Secretary referred to the riot that took place in Brixton on Monday. The right hon. Gentleman will know that one of the factors behind some of the rising unrest in Brixton was the 67 per cent. increase in the proportion of young blacks who have no jobs registered with the Brixton jobcentre. That increase has occurred over the past year. He will know that overall there has been a 16½ per cent. increase in unemployment in the Brixton employment area. In every area where riots took place in the spring of 1981 there has been a further substantial increase in unemployment among young people. That is part of the potential for yet more trouble.

The Home Secretary was right to say that the police dealt with the unrest in Brixton efficiently and quickly. He was right also to say that, to an extent, that has not yet been adequately recognised in the House and that the police have responded to the Scarman report and made a number of changes in their policing methods and in their recruitment and training. The House should be grateful for this and should pay tribute to them. It has been a rapid response. Lord Scarman, in another place, said that the response of the police has been quicker and more urgent than that of many other institutions in society which have still not made the changes which are necessary if we are to avoid a repetition of what happened in 1981.

The House of Lords Select Committee on Unemployment stated that unemployment was one of the causes of ill-health, mortality, crime and civil disorder. The Secretary of State for the Environment, speaking at this year's Conservative Party conference, showed his understanding of the close link between unemployment and crime when he said: The social consequences of an out-of-work society increasingly reveal themselves in the statistics of inner city life. The crime rate, the vandalism and the hooliganism place a growing strain upon our police. The right hon. Gentleman has come to recognise, as few other Ministers apart from the Home Secretary have, the marked difference between the state of affairs in the inner cities and those in other more fortunate areas. Only last week during a speech that the Secretary of State for the Environment made on Merseyside, from which I am not entitled to quote at length because it was made at a private occasion, the right hon. Gentleman said that all groups in society must work together much more closely if we were to deal with the problems of the inner cities. He did not exclude the political parties.

It is vital that the Home Secretary and the Secretary of State for the Environment bring home to their colleagues in the Cabinet the urgency of trying to provide alternative systems of work—I would not exclude from that a massive expansion of the community enterprise programme and of community industry in the inner cities—if we are to reduce the ever-present tinder that is created by many young people who have nothing whatsoever to do except to move into crime and social disorder.

The Secretary of State for the Environment cannot be wholly exonerated from a share in responsibility for the growing despair in our inner cities. The right hon. Gentleman, as he has said, has presided over increased provision for the urban programme, particularly for the partnership authorities and those that are most heavily pressurised. However, a fact that has been insufficiently brought out in the House of Commons and to the public is that the decrease in rate support grant in the inner city areas since 1980 has been greater than the whole of the increase in the urban programme. The way in which the rate support grant has been so heavily biased against inner cities and London is one of the main reasons for the decline in resources with which they must cope.

The Secretary of State for the Environment (Mr. Michael Heseltine)

indicated dissent.

Mrs. Williams

The right hon. Gentleman shakes his head, but he has not so far denied the figures issued by the Association of Metropolitan Authorities, which show that in real terms resources for Liverpool since 1980–81 have declined by 14 per cent., for Manchester by 25 per cent., for Newcastle by 34 per cent., and for London by even more.

The Prime Minister, in a remarkable exercise of self-congratulation on Wednesday, said that the inner city authorities—indeed, all local authorities—could do a great deal for themselves and for employment by a massive expansion in their capital investment spending. However, the right hon. Lady did not address herself to the fact that every increase in capital investment spending by local government carries with it absolutely unavoidable revenue consequences. Those consequences arise on interest rates, loan charges and any staffing that capital investment may require, whether it be capital investment in hospitals, schools or even housing estates.

As the Financial Times states this morning, the Prime Minister, were she willing, could see that revenue account did not carry interest rates and loan charges. If they were to be carried as part of the capital account, much of the difficulty that local government faces would be moved aside. If the Secretary of State for the Environment and the Prime Minister are serious in what they say about underspend in capital investment by local government, they should address themselves to how to remove the major penalties that local government incurs if it attempts to carry out those instructions.

However, the problem goes further. To be fair, the Secretary of State for the Environment recognised it in a speech that he made recently to the builders' conference. At that no doubt agreeable occasion at the Cafe Royal he said that he recognised that there were long lead times in bringing forward major investment projects. Of course the right hon. Gentleman is right. I know that the North-West water authority would take many months before it could get any major investment projects moving for an area where, as the Secretary of State knows, as he is also the Minister responsible for Merseyside, we are daily still chucking 1,300 million litres of untreated sewage into the dirtiest estuary in northern Europe—the Mersey. However, the North-West water authority cannot respond to the Government's strictures to produce a pre-election boom, because it does not have the plans, the skilled labour or the engineers to respond to that death-bed conversion.

The Secretary of State knows that all that is true. To talk about spending on capital investment without adequate continuity of finance, training and planning is to whistle in the dark. All of us who have been involved in long lead time projects know that that is true.

Perhaps the Secretary of State can say something about a suggestion in the White Paper that the housing investment programme basic level should be cut by 20 per cent. The Secretary of State knows that over and above that there will be a decline in the sale of council houses in the coming year and consequently in receipts from that source.

The Association of Metropolitan Authorities estimates that a reduction of about 32 per cent. will take place in housing investment unless there is some relenting in the proposals in the White Paper. However, there is more than that.

I am grateful to the Secretary of State for having recognised the desperate plight of some of the estates on Merseyside and bringing them within his refurbishment project and, as in one estate in my constituency, bringing them within a major reconstruction programme over and above the housing investment programme. I accept and appreciate that he has taken that action when the situation was becoming virtually out of hand because of the conditions in which people had to live.

However, the right hon. Gentleman knows, and I know, that the present level of repairs on council housing estates is little better than a disgrace. People wait for many months for even the most basic repairs on roofs, damp walls, broken lavatories and broken sewage pipes to be undertaken, and for rubbish to be taken away. The Secretary of State is not alone responsible for that. Many local authorities, Conservative and Labour, are much too slow in responding to the desperate needs of tenants.

I say to the Labour Party that one of the ways that we could do most for tenants, rather than pathetically repeating how terrible the conditions are, would be to accept an alternative registered list of private contractors to do repairs so that, if the council did not do them within a certain time, the tenants could arrange to have them done. I would believe some of what the Labour Party spokesman said today so eloquently from the Front Bench about the inner cities if the Labour Party attempted to relieve the desperate conditions suffered by many tenants month after month and sometimes year after year, and about which no one seems to show any concern.

In my constituency, which is supposedly up-market, there are infestations of rats and cockroaches and other disgusting conditions in many flats and houses. At the moment it would take Sefton council 30 years to deal with the unfit houses and those that require major repairs.

Mr. Clive Soley (Hammersmith, North)

I would not like the right hon. Lady to mislead the House unintentionally. A number of local authorities, including Peckham, which the right hon. Lady mentioned, have already given the right to tenants to arrange for repairs to be done. However, they must be done by people who are acceptable to the council. Otherwise, they might be fly-by-night builders who disappear. All hon. Members are aware of that problem. Perhaps the right hon. Lady will address herself to it.

Mrs. Williams

I referred to an approved list of private contractors, because I recognise the point that the hon. Gentleman has made.

Mr. Soley

That is not what the right hon. Lady said in Peckham.

Mrs. Williams

It is indeed what I said in Peckham. I hope that the hon. Gentleman and his colleagues will use their efforts to make sure that the many Labour councils that still do not permit that to happen will now take urgent action to bring that about.

The hon. Gentleman leads me to say one other thing, of which many of us are aware. To some extent a system of outdoor relief for Labour councillors is developing in London, based on public expenditure that I believe cannot be justified. In the past few weeks, the Greater London Council has co-opted two gentlemen who are very active in Labour politics—a former Member of this House, Mr. Arthur Latham, and the former leader of Lambeth Council, Mr. Ted Knight. Both may have much to contribute to the GLC, but I feel strongly that the way in which public funds are being used to find employment for Labour activists is coming close to being a disgrace—and it has nothing whatever to do with improving conditions for those living in the inner cities.

The Home Secretary referred to the ways in which he is trying to improve the situation in the inner cities. As I and many other hon. Members have said, the Home Secretary must recognise that crime has increased rapidly in the past two years—a development not unrelated to economic conditions. I recognise some of the things that the right hon. Gentleman is trying to do with regard to the police, but I wish to suggest two more.

As the Home Secretary is aware, there is a growing and frightening polarisation of police authorities outside London on political grounds. Some authorities, largely Conservative dominated, will never criticise the police, even when they should—Lord Scarman in another place stressed the basic responsibility that all police authorities have in this respect—while other authorities, largely Labour dominated, never support the police, however justified it would be to do so. That growing polarisation must be a matter of profound concern to the House, because if we start politicising the police, Heaven help our democracy. Will the Home Secretary, therefore, consider changing the composition of police authorities in such a way as to recognise that the time may now be coming when a third element, representing community and voluntary organisations within a police area, should be co-opted to serve on police committees alongside elected councillors and magistrates? I recognise that this could not be done overnight, but I believe that it is worth consideration.

It is important that we should make constructive proposals as well as justified criticisms in this debate. The Home Secretary should consider the problems of promotion within the police force. I recently had the pleasure of discussing this with the gentleman who is now Commissioner of Police of the Metropolis, Sir Kenneth Newman, and with the senior command course at Bramshill police college. In the past, they had adopted a promotion system whereby police officers rarely spent more than two or three years in one post in a particular locality. The argument, of course, is that police officers should not develop too close relations with members of the criminal community as that may lead to allegations of corruption, even though they may not be justified. The Home Secretary will be aware, however, that serious community policing cannot be based on very short periods of familiarity with a particular community. He may therefore wish to consider whether there should be a separate promotion structure and a separate structure of financial rewards for those long-serving policemen who serve the community by getting to know it extremely well.

On police training, will the Home Secretary consider a more substantial sandwich element in police training so that young officers have the opportunity to encounter the real conditions on the streets and then to discuss them with more experienced officers before they are finally sent out at the end of their training period?

My final, more general, point to the Government is this. The right hon. Member for Sparkbrook, all too typically of the Opposition Front Bench, does not wish to hear any speeches but his own, but I am grateful to the Home Secretary and to the Secretary of State for the Environment for taking the debate seriously, as the House addresses itself seriously to some of these problems. As the Government move towards new police powers—the Home Secretary will be as aware as any of us of the dangers that go along with that—I hope that they will give further consideration to race relations. I am glad that they have decided to monitor the recruitment of young black and brown people to the Civil Service, but I believe that they should go much further in considering how to recruit and promote members of our ethnic minorities throughout the Government service, the nationalised industries and local government. If we do not create an element in the black and brown communities, and particularly the West Indian community, with responsible leadership roles, there will be no stereotype of a respectable and law-abiding nature with which young West Indians can identify. There is almost nothing more vital than to begin to create a leadership group in the West Indian community and to recognise the real talents and abilities that it can bring to our multiracial and multi-cultural society.

11.26 am
Mr. Tony Durant (Reading, North)

I congratulate the hon. Member for Peckham (Ms. Harman) on her maiden speech. If I may say so, it was commendably short, which is always welcomed in this place. I am delighted that she mentioned Harry Lamborn. He was a very popular Member of Parliament and many of us liked and respected him very much. She was also right to speak for her constituents. That is something that we expect. She made a very forceful speech on their behalf and I am sure that we shall hear from her again. Just because I have said something nice about the hon. Lady, I hope that she is not expecting me to approach her for a pair. I have already made my own arrangements. I remind her, however, that her party has been in power in the Peckham area for many years. With her vitality and dynamism, I hope that she will get hold of the council and give it a good shake-up to achieve some of the things that she wants.

I agree with the right hon. Member for Crosby (Mrs. Williams) about the management of council estates. I lake a very jaundiced view of this. I believe that it is almost too big a job for the local authorities to tackle and I take the right hon. Lady's point that we must consider other means of getting repairs done. We may examine a number of different ways of doing this, but it is vital that something should be done, especially for those who live on large estates and who feel that they are neglected and that the council is not interested.

I went to Tulse Hill to see the interesting experiment in which a person from the Department of the Environment has been put into a council estate to try to put things right. It is interesting to note that the first thing that that person did when she arrived was to discuss with the caretakers what the problems were, as the caretakers often know what they are. The message was that the town hall was too far away. A local office was therefore set up on the spot. That has made a fundamental difference. It is something that town halls can do and I recommend it.

We heard a great deal from the Opposition Front Bench about law and order. I must say that the speech of the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) was the biggest load of humbug that I have ever heard. It was absolute waffle from beginning to end. The right hon. Gentleman said that the Government could take no credit for the increase in police numbers. Before the last general election, there were headlines every week about the number of constables and senior officers of the Thames Valley police force who were resigning. The Labour Government in a panic set up the Edmund-Davies committee, but nothing was done about the problem. The Conservative Government tackled the situation immediately as a matter of absolute priority. The right hon. Gentleman also made disparaging remarks about the Thames Valley police. I spent two evenings with that force in panda cars and I know that they are doing a remarkable job despite great difficulties. It was therefore unjustified to make the sneering attack that so many of them had defended one house. When I was with them, an incident occurred in which a large number of constables had to deal with a poor woman in a particular property. The right hon. Gentleman's speech was nonsense.

On my night out with the police, we were parked in the main street when, suddenly, a car shot down the road going the wrong way. We took off after it, caught it and flagged it down. The police breathalysed the driver, who was a journalist with the local newspaper. They arrested him and put him next to me in the police car. He turned to me and said "My God, have they got you as well?"

I congratulate my right hon. Friend the Home Secretary on his approach. He said clearly that law and order cannot be tackled from only one point of view. We cannot just concentrate on the police or the courts. We are all in the battle together. Much of the problem is related to public attitudes. We must make people more aware of their responsibilities to society in trying to combat crime. We cannot have a policeman outside everyone's house.

The courts are often blamed for lenient sentences. We must give them the tools to do the job. The Government have rightly started to do something about prisons—an area that has been long neglected. I congratulate my right hon. Friend on the way in which he is tackling the problem.

I turn to the Gracious Speech. I welcome the Government's proposals for tackling the problem of leasehold property. The issue has caused great anxiety for those who wish to buy their own homes. The Government have had to tackle a tremendous task, especially from a legal viewpoint, and it is interesting that public pressure persuaded the Government to take action. We see everywhere the effects of the sale of council houses. We are beginning to have mixed estates. We are not all "us" or "them". Private householders are next door to council tenants—and that is how it should be. We should not have separate aspects to our society.

The Opposition speak a great deal of nonsense about the sale of council houses. They said that it would mop up the supply and make a privileged class. All the rubbish that has poured from the Opposition has been proved to be nonsense. I welcome the next step in that important programme. There may be 500,000 sales by the end of next year. I am not sure of the figure, but my right hon. Friend the Secretary of State for the Environment can tell me. It is a remarkable social revolution, which the people wanted. That is important.

I turn to the subject of the water industry. I am not popular with the water industry. A colleague of mine attended a drinks party recently and said that he knew me. The other chap said "I work for the Thames water authority and Mr. Durant is a pain in our backside." Well, I am. The Thames water authority needs examination. All its little vans keep rushing around. There is so much over-expenditure. Recently the managing director of a multimillion pound company, operating from one floor, took me to his window and pointed to the building opposite and said "What are you doing about that?" It was the offices of the Thames water authority—one building for one division. I know that the new chairman of the authority has been tackling the problem, but at the same time the Government are right to tackle the whole structure of the water industry. The Conservative Government were right to create the new water authorities to obtain the right catchment areas, but the structure may be wrong.

I am delighted that legislation will be brought forward to deal with mobile homes. My personal plea is that the Secretary of State for the Environment will consider residential boat owners. It is a small group of people who choose to live on water in residential boats, but who have no security of tenure. We must tackle that problem. I have consulted the Government, and I know that they are aware of the problem. I appreciate the difficulties involved, but we must consider the matter urgently.

I hope that the Secretary of State has not forgotten rate reform. It is not mentioned in the Queen's Speech. I assume that the rolling programme continues and that there will be a White Paper sooner or later, followed by Government proposals. I do not intend to let the matter drop. I made my maiden speech on the subject. I am a rate reformer, and no one will prevent me from talking about it. We must change the system because it is unfair. I know that it is a difficult task—indeed, I can knock down each option. I have warned people that they must pay. It is easy to say that we must reform the rating system, and get a round of applause, but I always say "Wait a minute, you must still pay, but it may be in a fairer way." We must tackle the problem.

I support local government. Councillors do a remarkably good job. They face enormous difficulties because they have no back-up services. I remember when I was a councillor for six years. I remember rushing from my office, flinging myself on to a train and then running down the road to the council chamber to get there in time for the council meeting. Many councillors have to do that. If they have any enthusiasm for their job, they have to work hard at weekends. We must give credit to councillors of all complexions for the work they do. I am not being partisan.

During the past few years councillors have had to tackle the difficult problem of rolling back the expenditure of local government, which had become far too high. Small business men cannot sustain high rates, which are beginning to damage the community. For example, Berkshire county council raised the rates by 27.5 per cent. last year. The result is that people are looking towards Basingstoke to set up their companies. The area is suffering because of the level of rates yet it is ripe for development. It has an abundance of skilled people and all the right facilities, but the level of rates is beginning to make people rethink. The Secretary of State was right to introduce a tough outlook on local government expenditure. The problem had to be tackled. We cannot continue to roll on in the same old way.

I congratulate the Government on what they have done. It is along the right lines. I hope that they will press ahead and win the next election.

11.36 am
Mr. David Ennals (Norwich, North)

Like the hon. Member for Reading, North (Mr. Durant}—who, as with his Prime Minister, is an unsuccessful rate reformer—I wish to congratulate the hon. Member for Peckham (Ms. Harman) on her notable maiden speech. She was right to speak sharply and clearly about conditions in her constituency. She brings to the House a great deal of experience as a legal officer with the National Council for Civil Liberties. I am sure that we shall benefit from her wisdom and experience. However, we will always remember her predecessor, Harry Lamborn.

I wish to base my remarks on the Queen's Speech as it affects my constituency. I tried to find something in it that would bring hope and comfort to the local authorities in my area—the Norwich city council and the Norfolk county council—and those whom they represent. I welcome the fall in the inflation rate to its level of four years ago—but at what a price? For the first time the dark cloud of unemployment hangs over the city of Norwich. I can find nothing in the Gracious Speech to bring hope to the people of Norwich and the county of Norfolk. Perhaps the new quango that will have responsibility for certain museums—there are a number in Norwich—will produce a job or two. Perhaps the Secretary of State will say something about that when he replies.

I shall await with fascinated interest the legislation to improve the health and social services. The Government's record suggest that such legislation can only damage the health and social services. They have done nothing to improve the efficiency and quality of social services, so their proposals are not hopeful.

Does the Gracious Speech say anything about our schools and universities, which have been very hard hit by the Government's policies? There are the problems of rising class sizes, fewer books, the closure of rural schools, more teachers unemployed, and even breaches of contract with the excellent band of dinner ladies in my constituency. There is also the damaging effect on many of our universities, including East Anglia university.

There seems to be no prospect of jobs, particularly for our school leavers and for older folk alike. In the Gracious Speech the Government say that they are deeply aware of the anxieties and distress caused by unemployment". Where are the proposals to do anything about unemployment? It would appear to be more like crocodile tears, because the Government are responsible for the situation that they themselves have created.

There is an excellent relationship in Norwich between the Norwich city council and the Norfolk and Norwich chamber of commerce and industry in trying to tackle our unprecedented level of unemployment. The employment committee is doing an extremely good job, but it is fighting a losing battle. A study was made of 104 companies in Norfolk, and its report of 27 October this year stated: The latest Economic Survey undertaken by the Norwich and Norfolk chamber of commerce and industry covers the July-September quarter and reveals a worsening situation in almost all respects. For many of the items studies studied the balance of opinion during the quarter was negative; there were more firms operating under worsening conditions than firms for whom conditions were favourable. This is true for the home market, both deliveries and orders, but is even more striking for exports, with 39 per cent. of firms expecting a downward trend in export orders during the quarter. Firms are also significantly less confident than they were at the beginning of the year. Although few respondents expect things to get worse, the proportion anticipating improvement in the short term has declined steadily. There is pessimism on output, on export prospects and, for small firms mainly, on profitability as well. It is an extremely depressing report.

The October figures for the Norwich district show that unemployment is 15 per cent. higher than it was at the same time last year. A year ago, 41 per cent. of firms reported an upward demand for their products on the home market. Now only 27 per cent. are showing an upward demand. For exports, the trend is even more depressing. More than twice as many firms report a downward trend over the past quarter compared with a year ago, when there were far more firms reporting an improvement. Quarter by quarter the position is getting steadily worse, not better, despite the fact that the Government, every time a Minister addresses this House or the faithful in the country, claim that the position is improving.

As for investment in plant and machinery and building—the seed corn of future productive capacity—there is a steadily worsening position in the county. It is hardly surprising that, while 25 per cent. of the firms expect to reduce their work force, only 15 per cent. expect an increase. Thus, there will be more unemployment. Far more firms are operating below capacity than was the case a year ago, when everyone hoped that the worst was past. People unwisely believed what the Government were telling them.

Having virtually stopped council house building and forced elected councils to sell council houses against their will, the Government now propose to do the same with housing associations. I have been looking at the Housing and Building Control Bill, which has just been published. I shall not comment on the whole of the Bill, but the proposal to require building societies to grant the same right to buy is ludicrous.

As soon as I saw the proposal in the Gracious Speech, I consulted housing associations in my constituency, particularly the Broadlands housing association, which has 1,130 units of accommodation. The secretary, Mr. Martin Miller, speaking not only for himself but for the members of his all-party committee, said that they were shocked by the proposal. I recall that I was strongly lobbied by the chairman of that housing association—an influential and much respected Conservative in Norwich—to make certain that the 1980 Bill did not take in housing associations. I find it almost unbelievable that the Government should seek to do what is proposed in the Gracious Speech.

Already within housing associations there is much less movement than there was. The Broadlands waiting list is up to 615, a much increased figure and the highest that it has ever been. The vast majority of the people concerned are in social need.

If there is to be legislation affecting housing associations, the Secretary of State can put right a serious wrong that was perpetrated on the almshouse charities. I hope that he will deal with that point when he replies. Schedule 16 to the Housing Act 1980 must be removed or amended. The long title of the new Bill would enable the Secretary of State to do that.

I have been in correspondence with the Minister for Housing and Construction concerning the hospital in Norwich. It is a magnificent institution which has been giving service to the deprived citizens of Norwich for over 600 years. It is the second oldest almshouse institution in Britain. There are also the Norwich consolidated charities. Those charitable bodies, which meet a real social need, feel very angry that new bureaucratic and costly obligations are being placed upon them quite unnecessarily. The officers of the almshouse charities are very dissatisfied with the attitude of the Minister for Housing and Construction. I have shown them the correspondence that I have had with him, and I shall have compelling evidence to put before him to enable him to put right the wrong that has been done. The problem was very well set out by Mr. David Scott, the secretary of the National Association of Almshouses, towards the end of September, when he wrote: The Minister should be asked to consider the intense consternation with which trustees throughout the country have received the news that a Government which is so clearly against unnecessary bureaucracy should for the first time in history impose legal sanctions concerning accounting requirements upon almshouse charities which have received no criticism over past years regarding the conduct of their finances and which are widely regarded by the Charity Commissioners as a model of prudent and economic stewardship. That is a very powerful case. I hope that the Minister will take action on it, and I shall pass on the evidence for him to use.

In the Gracious Speech there is also a crisp sentence about continued restraint on public spending". What does the Tory-controlled Norfolk county council think about the Secretary of State's handling of his responsibilities in that respect? I can report that it is very angry. The Government's housing target for Norfolk next year, according to Mr. John Alston, the leader of the council, is "neither fair nor consistent". He said that a few days ago. He was reported as saying that by basing targets for next year on past spending levels, the Environment Secretary had 'clearly set out to encourage the profligate and punish the prudent'". The report goes on to say: Norfolk county council risks spending £3 million above the preliminary £212 million Government target for 1983–84. Mr. Alston said that it would mean a loss of grant and also higher rates. I am glad that he has pursued his battle on behalf of his county council, although I understand that he does not seem to have got very far with the Secretary of State.

According to a report in The Guardian a few days ago, the Secretary of State is understood to have offered the councils that sent a deputation to him no hope of the protection from penalties that they seek. I suppose that I should be delighted that the Secretary of State is as prepared to clobber Tory councils as any others, but two wrongs do not make a right and the right hon. Gentleman should accept the criticism and responsibility for his behaviour in overriding the decisions of local authorities and establishing unacceptable principles for the rate support grant.

The Guardian also reported that the Secretary of State was driving home the message that English councils should try to invest an extra £1 billion by Christmas in house building, home improvements, derelict land clearance and big repair jobs on schools, old people's homes and other municipal properties. At a meeting between local authority leaders and building industry chiefs he suggested how rules could be bent and new ideas introduced to bring express relief to the construction industry.

The Secretary of State has been in office for 180 weeks. It has been a time of cut, cut, cut. Now we hear him and the Prime Minister saying "Spend, spend, spend"—and all in the next six weeks, as if authorities can create capital projects out of the blue. Of course, if councils follow the advice of the Secretary of State and the Prime Minister, they will be clobbered. Whatever they do, they will lose.

The Home Secretary and my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) concentrated on law and order. I resented the criticism of my right hon. Friend's speech by the hon. Member for Reading, North (Mr. Durant). It was an admirable and lucid speech and the hon. Gentleman should read it in Hansard.

Of course, I understand that my right hon. Friend's speech hurt Conservative Members. The Government came to power on a number of promises. One was that there would be tax cuts and, although there may be cuts just before the general election, so far they have been a Government of tax increases. The Conservatives also promised that the unemployment queues would be cut, but they have increased dramatically. Another promise was that a Conservative Government would tackle law and order problems. They have signally failed to do so.

There is a crime wave in normally peaceful Norfolk. The increase in crime is not only a big city problem. There was a 10 per cent. increase in crime in Norfolk last year—way above the average increase in shire counties.

It is clear that more police are needed on the beat. I wrote to the Home Secretary about that and he replied on 23 September this year: At the end of December 1981 the police/population ratio of Norfolk police area was 1:548. This was the second lowest of any force in England and Wales". Did the right hon. Gentleman say that he would increase the number of police or suggest to the police committee that there should be an increase? No. Did the committee decide to ask the Home Secretary to authorise an increase?

No. The Home Secretary wrote: In September 1979, the Norfolk police authority requested an increase of 59 posts in the establishment for the financial year 1979–80 but subsequently decided not to proceed with it. Guess why. It was because of what the Secretary of State for the Environment was doing about the money that was available. The Home Secretary went on: They informed us in June 1980 that they would wish to reconsider an increase for 1981£82 but the request was not renewed. In normally peaceful Norfolk crime is rising rapidly year by year, as is undetected crime, and the police-population ratio is the second lowest of any force in England and Wales. Is it surprising that I and the people of Norfolk and Norwich feel angry? It is time that the Government took action.

We have rising unemployment, dismal economic prospects—that is not a guess; it is confirmed by the active and effective local chamber of commerce—lengthening housing waiting lists, lower education standards, rising crime and too few police and a wretched rate support grant settlement for which the Secretary of State for the Environment is directly responsible.

After "cut, cut, cut", we now have "spend, spend, spend". We know that the election must be on the way. It is clear that the Prime Minister and the Secretary of State do not sufficiently understand the way in which local authorities work. They assume that councils can set in motion within six weeks capital projects that can reach fruition. The Queen's Speech has nothing to offer to the solution of any of the problems to which I have referred.

11.57 am
Mr. Robin Squire (Hornchurch)

The right hon. Member for Norwich, North (Mr. Ennals) made a wide-ranging speech and concluded on matters affecting the Home Office. I do not intend to spend long on those matters, but, like my hon. Friend the Member for Reading, North (Mr. Durant), I found the speech of the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) disappointing and, in two respects, surprising.

The right hon. Gentleman implied that the Edmund-Davies pay award to the police would have been met by a Labour Government in full and on the same terms and at the same time as it was met when the present Government came to power. I have not heard that suggestion before and I do not believe that many people will accept it.

However, if that was strange, the right hon. Gentleman's suggestion that the only commitment that the incoming Conservative Government honoured in the public sector was that to the police was positively mind-boggling. A number of Clegg recommendations were met in full by the Government over a range of public services. If history is to be rewritten in that way, the books will not be included in the non-fiction section of my library.

Mr. Ennals

The hon. Gentleman must have a short or a selective memory. I was a member of the Cabinet when the Edmund-Davies study was set up and I remind him that it was agreed that the recommendations would be accepted. For the hon. Gentleman to suggest that a Labour Government might have refused to accept to implement those recommendations is a travesty of the facts.

Mr. Squire

I am pleased that I gave way. The right hon. Gentleman has only underlined that the Government of which he was a member, even if they said that they accepted the Edmund-Davies recommendations, did not implement them. That explains why so many police were leaving. The right hon. Gentleman must not delude himself or encourage the attempt of his right hon. Friend the Member for Sparkbrook to rewrite history.

I intend to concentrate primarily on what are termed environmental matters. I welcome the commitment in the Gracious Speech to extend home ownership to many current tenants. I welcome unreservedly the progress that has been made in the sale of council houses all over the country. I understand that the figure currently stands at nearly 400,000. It is to be hoped that by the time we face the electorate that will have increased to the magic figure of half a million. The profound social implications of the change are many. It will take some time for them to filter through.

The policy was a major reason behind a substantial move to the Conservative Party over a range of constituencies including my own in north-east London. Time after time, I have encountered people who had not previously supported the Conservative Party but who recognised that ours was the party liberalising them from what many regarded as a state of near-servitude.

I welcome all steps to increase home ownership. I should also like to urge my right hon. Friends to give some consideration to those who are unaffected by these changes. I shall be optimistic. I shall assume that in a few years' time home ownership may have risen from 65 per cent. to 70 per cent. or possibly 75 per cent. No one can predict the figure. Whatever it is, there will still remain 25 per cent. or possibly 30 per cent. of people who cannot own a home or who, in a few cases, do not wish to own a home. Some considerable regard has to be paid to their position and their prospects. Judging from most surveys, the quality of housing generally, not just rented housing, is in gradual decline. We are not yet providing sufficient funds, private or public, to maintain the average quality of the housing stock.

To many Labour Members council housing represents the only legitimate alternative. The right hon. Member for Manchester, Ardwick (Mr. Kaufman) does not, I know, necessarily hold that view. Many of his colleagues do. I find, speaking to people involved in housing, that those who protest most about private landlords, and particularly private absentee landlords, overlook the fact that for many people the biggest absentee landlord of all is their local authority. It is double standards to suggest anything else. Those who believe that local authorities are carrying out their functions to the best of their ability delude themselves.

Only recently, Shelter said that an estimated 100,000 properties were empty and in council hands. That is damning indictment. It is an indictment shared by all authorities. I am not suggesting that these properties are held only by authorities under Labour control, although it is fair to say, on the basis of detailed analysis, that many are under such political control. Council housing does not present an attractive picture. There is clearly room for expansion, expenditure and improvement. There is also room for expansion of the private rented sector. I shall concentrate on two or three specific areas.

The private rented sector dwindled to 13 per cent. in 1978. One assumes that it has sunk even further in more recent years. This is sad. Historically, this sector has been used by a number of people, especially the young and the mobile who would find it much harder to be housed by local authorities. Indeed, in many parts of London, if one's only qualification is that one is young and single, the chance of being housed by the local authority is virtually nil. Many of these people cannot afford to purchase. Equally, they are offered precious little, if anything, from local authorities. Unless we are prepared to recognise this growing need and expand other sources, which I shall suggest we have available, we are condemning many such people to sleeping rough or, in certain cases, continuing to live in a family relationship with the increased strains that this brings on either side of the family.

One obvious area for development is that of the resident landlord. No one doubts that there are many rooms, however defined, which are under-used and under-occupied and which the owners of the property would be only too prepared to let if they did not have considerable fear about their chances of being able to take repossession of such property if they so desired. I hope that the Government will consider bringing forward proposals to speed up the hearing of landlord-tenant matters to ensure that landlords, instead of having to wait six or seven months for a hearing, could expect a hearing within a comparatively short time. Hon. Members must understand the deterrent that prevents people letting such property.

If legislation were brought forward to permit the retaking of the landlord's own property, within his own house, that much quicker, we could mount a substantial nation-wide campaign, using the television and press, to emphasise that matters had been simplified, that it was possible for such steps to be taken comparatively quickly and that landlords would be able to make some considerable financial gain if they let their property. I do not wish to give further details at this moment. It would, however, be a further incentive, if the Government were examining the problem in detail, to consider relieving at least the elderly in that position of some of the tax implications of the first £200, £300 or £400 worth of rent.

It is important to get matters moving. This spare facility is not being used while, at the same time, there is an increase in the numbers rendered homeless. In the past year a record number of over 68,000 people were declared homeless. How to define "homeless" becomes increasingly difficult, but 68,000 families and individuals were declared homeless. Many more would have to be included if one accepts homeless as meaning those living in totally inadequate accommodation which serves as a breeding ground for future social problems.

I turn now to the subject of the non-resident landlord. I deplore, like my right hon. and hon. Friends, the commitment by the Labour party to repeal shorthold tenure. It has added nothing to a calm understanding and appreciation of housing. It has removed one further area of possible use. It can only be deplored by would-be tenants and those who are not now prepared to let their property.

I wish to concentrate, not on the shorthold aspect, but on a further aspect of the contents of the Housing Act 1980, correctly and properly introduced by the Government. I refer to the assured tenancy. Not much is heard about it. Only a comparatively small number of such tenancies have been taken out. I see the assured tenancy as offering a way out of the party political battle ground that renting and landlord-tenant relationships have become. The assured tenancy concept has at its centre the licensing of landlords with the Department of the Environment. That seems a good concept that I would argue should receive support on both sides of the House. If one feature has predominated in the folklore of the Labour Party, it is that landlords consist of avaricious greedy men. That there are such landlords is undeniable, but to the extent that there are landlords who are not like that—and there are many—a way out would present itself if this concept of licensing were extended not just as it is at present to a comparatively small number of bodies, largely corporate bodies related to building societies and other corporate organisations, but to individuals as well.

Each of the existing limits on an expansion of the assured tenancy sector could be lifted and ultimately abolished. There is the limit which confines it to new build, and obviously that could be extended. There is the existing limit applying to corporate landlords, and that could be extended. Finally, and perhaps most important, there is the existing limit on rent allowances which, at some figure under £30 a week, ensures that, while it remains, those who would benefit from such rented accommodation are not those at the poorest end, especially not many of those in the greatest need. Each is capable of expansion over a period, but the last action that I urge on my right hon. and hon. Friends is that each of them should be extended and expanded at one go. It will take time, but the time to start is now because the need is there now.

The second area of housing that I wish to discuss is that concerned with local authorities. Before doing so, however, perhaps I might refer also to increased capital expenditure. I welcome the desire for an increase in expenditure by local authorities. But there are major problems. Many authorities, including many that have complied with the guidelines laid down by successive Governments in the past six or seven years, are finding this year to be as hard as, if not harder than, any previous year. To require those authorities that face severe problems now to spend capital receipts, which are earning interest, means that those receipts will no longer earn that interest and can only contribute to an increased revenue expenditure, which will bring them up against the penalty clauses, as hon. Members are well aware.

Mr. Gerald Kaufman (Manchester, Ardwick)

The Prime Minister is not.

Mr. Squire

I am sure that the Prime Minister is well aware of the implications. I urge my right hon. and hon. Friends to consider carefully the suggestion by the right hon. Member for Crosby (Mrs. Williams) that the revenue effects should be amalgamated with capital, or that for purposes of measuring the penalties the interest charge effect should be disregarded in coming to any penalty totals. If that were announced in the near future, I am sure that it would produce a more favourable response from local authorities.

If the Government can also see their way to demonstrating a high percentage commitment to the capital expenditure allocation for next year and for subsequent years, they will increase the prospect of the creation of a rolling capital programme rather than the situation at present, when, like virtually every other State undertaking, there is the fear that the largesse for one year will turn into the parsimony of the following year with the consequence that schemes that would otherwise be started will be ignored or deferred yet again until better times.

One of the measures not mentioned in the Gracious Speech, as my hon. Friend the Member for Reading, North (Mr. Durant) reminded us, is a statement on local authority funding and financing. I, too, am one of those who keep on at the subject. If we are realistic and we recognise that it is unlikely that there will be a major, once-and-for-all reform in the coming year, there are none the less several measures which can be taken to make life easier. In the medium term, the change of basis to capital valuation has been well canvassed, and I say merely that it makes a lot of sense but that it cannot happen overnight.

One short-term measure that I support is the ending of the concept of precepts. If we are seeking greater accountability between ratepayers and the councils which they elect, we should increase the profile of the respective authorities at county and district level and, in London, at borough and GLC level. It is confusing enough with the average rate demand to expect people to understand where the money goes and, in addition, to expect them to understand the respective roles played by, shall we say theoretically, a spendthrift GLC and a controlled, balanced council locally which has endeavoured to keep its expenditure to the minimum. For the very small sum that would be involved in separate assessments, there would be a gain for democracy, and I would support it fully.

There is another and, in its implications, a more major change that I should like to see. It refers to non-domestic rates. The non-domestic rate is not a good local tax. It was not a good local tax even when there was a business vote. It is even less a good local tax now that there is no business vote. It is in no way democratically accountable. It is a payment made by businesses, rich and poor, to which there is no linked authority and responsibility. In the long term, I should like to see some recognition that the non-domestic rate is by its nature a national and not a local tax. But I stress "in the long term". To remove it overnight would leave a gaping hole in local authority financing which I fear could be filled only by an ever greater reliance on a measured Government grant, and we know the problems that the measurement of such grants have created under successive Governments.

If we recognise a commitment to make that transfer in the medium and long term, in the interim we shall tackle one of the great uncertainties of businesses, that their rate bills may rise by anything from 5 per cent. to as much as 35 per cent. We can tackle that by the Government suggesting a maximum increase for the non-domestic rate. Announced in the context of an interim solution leading to a long-term solution, including the transfer of payments direct to the centre—incidentally, that transfer would allow the Government to have a much greater say in, understanding of and control over their own funding and finances—that would make some sense. It would focus our attention on what form of funding we wished local authorities to have. It is undeniable that the present level, and any foreseeable level of local authority expenditure, cannot be funded by domestic rates in isolation. It is impossible to believe that the local authority element of that burden should be borne only by domestic ratepayers.

When the Government have finished analysing the responses to the consultation Green Paper, I believe that they will see that there is only one option still open to them. In the medium and long term, that is to top up the rates with a local income tax. Any other option would be either out of all proportion in terms of the cost per pound collected or hopelessly regressive and therefore liable to be repealed by any incoming Government of a different political hue.

Mrs. Shirley Williams

Does the hon. Gentleman recognise that the great advantage of a local income tax is that it shows a household's income, not simply the rateable value of the house?

Mr. Squire

I fully accept that. There may be a difference between us in that I have no inherent objection to a property tax per se—one can discuss the detail—but I am convinced that there is no possibility of a property tax in isolation being able to support current local authority services. A local income tax would enable the 5½ million income tax payers who do not pay rates to be brought into the local authority expenditure area instead of merely paying under the 60 per cent. Government grant area.

All hon. Members who put forward such a proposal must accept that it will not arrive tomorrow. There is a considerable discussion as to when it might arrive if the commitment were to be there. As the Select Committee on the Environment said in its report, a Government commitment to investigate in depth can sometimes produce a miraculous acceleration of possibility and a reduction in the time in which such a change can be introduced.

I urge my right hon. Friend, who I know has received many representations on local authority funding, to accept that none of the other options will prove workable. There will remain many domestic ratepayers who will be anxious for one or two of the well advertised abuses in the domestic rate system to be seen to have been ameliorated if not removed.

I add my congratulations to the hon. Member for Peckham (Ms. Harman) on her maiden speech, although she is not currently in the Chamber. I am sure that, like all hon. Members when they make their maiden speech, she will subsequently re-read every sentence and line of every speech following her own. She made a fine speech. It will encourage many hon. Members to come and listen to her again.

I went to Peckham for predictable reasons a couple of weeks ago and it was a depressing experience. Not, I hasten to add, purely on political grounds, although it is undeniable that it was a fairly depressing experience in that respect too, but because Peckham, like I suspect many other parts of Britain, was, dare I say it, depressing in itself. In many areas one could see fairly recent 1960s housing which had grown old before its time, the inhabitants of which often had a similar personal demeanour and approach. It seemed to me to consist overwhelmingly of people who were left behind when others had departed from the scene. They were people who were overwhelmingly dependent upon the State in one form or another—the local authority or the Government.

The biggest challenge that my right hon. Friend the Secretary of State faces in his campaign to regenerate the inner cities is not necessarily to spend greater sums of money—although that money needs to be spent is undeniable. Some areas, of which Peckham is a good example, have, at least in local authority terms, been under the control of the Labour Party for 40 years. Therefore, it is not simply a matter of mere money-spending, as the Labour Party claim. We must find a way to bring back to those areas people who have ideas and drive, who will give some "go" to the community and play a part in community activities to reduce the feeling of passive acceptance or, in some notorious cases, non-acceptance of the conditions. That is too often the impression that such areas seem to give.

I have spoken for some time and it is unfair for me to detain the House longer. In conclusion, I urge my right hon. Friend to bear in mind that Disraeli's third maxim was to raise the condition of the people. I can think of no more apposite area to which that applies than the present problems we face in the urban areas and the need for long-awaited reforms, which I trust and hope the Government will now be introducing.

12.24 pm
Mr. William Pitt (Croydon, North-West)

I congratulate the hon. Member for Peckham (Ms Harman) on her maiden speech. I hope that she will attend our debates rather than just appear at them as do some of her senior colleagues on the Opposition Front Bench.

Mr. Kaufman

Where are the Liberals?

Mr. Pitt

The hon. Lady is justly admired for her work with the National Council for Civil Liberties. The House will consider itself indebted to that council for its work.

I am reminded that there is no provision in the Gracious Speech for a freedom of information Act. We have constantly asked for such a measure, both long before my time in the House and during the past year. So far we have seen nothing. That is a serious omission, among many others, from the Gracious Speech.

The hon. Lady's speech illustrated the Government's policy since 1979 of divide and rule. One of the oldest traditions of the Tory Party is one nation. The Government have firmly turned their back on Disraeli. They have been assiduous in creating two nations. One nation has good jobs, good homes and good schools in good areas. The other—3.5 million of them—has no jobs, bad homes, bad schools and all in truly appalling areas.

I, too, was in Peckham for predictable reasons. I have worked for six and a half years in a stressed inner city area—Brixton. No jobs, bad homes and bad schools in truly appalling areas sums up that area. The comparison is between the Finchley man or, dare I say, the Finchley woman, and someone who lives in the inner city. The latter have been ill-served by Governments since the 1939 to 1945 war. The Government have been outstanding in their lack of concern.

It may help the Government if I detail some of the problems which face the inner cities. It seems that in the past hon. Members have been unable to make Ministers face facts. Only rioters seem to have any success in putting their points across. That is a curious perversion of our parliamentary tradition. The areas of Mayall Road and Railton Road, in which we had that tragic riot, and around which there was another disturbance last week, were politically neglected for 30 years. It took a riot that devastated people's lives and houses to get the redevelopment and housing action in the triangle working again. That is a perversion of our parliamentary Government.

The overall unemployment statistics are grim enough. Britain is one of the few developed nations in the world to be self-sufficient in oil, but it has doubled its unemployment since the Government took office. One person has been added to the dole queue every minute since May 1979. The figures of long-term unemployment—people who have been out of work for more than 12 months—are even more appalling and point clearly to the devastation in urban areas where most of the unemployment is.

In July 1979, total long term unemployment was 360,000. That was 24.6 per cent. of the total unemployed. In July 1980, the figure was 364,100, which was 22.6 per cent. of the total unemployed. The overall figure had dropped slightly, but unemployment had increased by then. In July 1981, 626,900 people were among the long-term unemployed, which represented 24.4 per cent. of the total number. In July 1982 the percentage rate had rocketed from 24.4 per cent. to 37.8 per cent. of the total number of unemployed. The figure stood at 1,070,500. More than 1 million people have been unemployed for over a year. More than 1 million can consider themselves to be among the long-term unemployed. That is one of the most basic and appalling problems for our inner cities.

The Home Office has released documents which show that 32,900 young offenders were received under sentence in 1981. There is a definite and shocking correlation between unemployment and crime. As unemployment rises, the crime figures rise. In line with the two nations philosophy, regional figures show that constituencies are called unemployment bright spots if unemployment is below 5 per cent. Those bright spots are concentrated primarily in the South-East, while the black spots are in the North and the Midlands. The unemployment bright spots include Aldershot, Croydon, South—a constituency almost adjacent to mine—Dorking, East Grinstead, Chesham and Amersham, Sutton and Cheam, Esher, Mid-Sussex, Ruislip and Northwood, East Surrey, Farnham, Surrey, North-West and Woking. It sounds like an estate agent's brochure giving all the desirable residences.

The unemployment black spots include Liverpool, Scotland Exchange, Consett, Newcastle, Central, Manchester, Central, Birmingham, Lady wood, Liverpool, Toxteth, Middlesborough, Birmingham, Small Heath and Liverpool, Edge Hill, which is represented by one of my colleagues. Unemployment in the worst city constituencies is usually about four times that in the best constituencies. Interestingly, although perhaps inevitably, all 17 constituencies in which unemployment is less than 5 per cent. are represented by Tories. None of the black spots is represented by them. The young and those nearest retirement age—the most vulnerable—are hard hit and members of ethnic minority groups are the hardest hit of all.

The dropping of interest and mortgage rates is a cynical protection of the Conservatives' middle class vote at the expense of our work force. They have not only put people out of work and into a state of continuing depression, but have removed the very work force that could produce the goods, and thereby the wealth, that Britain will need when it returns to so-called prosperity. They can give us the wealth base from which the microchip revolution can pass from the last part of this century into the beginning of the next. With 3.5 million unemployed we cannot even consider moving towards that. We must first get the majority of them back to work and build up the wealth base from which we can move forward.

The hon. Member for Hornchurch (Mr. Squire) spoke about council house sales, but they are not the answer. I still believe that the introduction of council house sales through the Housing Act 1980 was a panacea and that the intention was largely to catch votes. There is the myth that 90 per cent. of people want to own their own houses. When I was a young man, Brigitte Bardot was a glamorous film star and 90 per cent. of young men probably wanted to have some relationship with Mlle. Bardot. However, they realised that was not possible. People do not necessarily want to buy their own homes, but they want to be able to control them.

Mr. Squire

Without stepping down the somewhat difficult road of Brigitte Bardot, may I point out that many people outside the Conservative Party have urged the merit of council tenants being able to purchase their homes? They include groups such as the Child Poverty Action Group. If I may be presumptuous, it is a little glib to suggest that it is purely for Tory vote winning. Council house sales represent a major social improvement.

Mr. Pitt

The Conservatives have concentrated excessively on the sale of council houses and have forgotten that there are many other ways in which to expand housing control. There has been little or no encouragement of co-operatives. The Tory Party has given little encouragement to tenant management schemes. We talk philosophically about the sale of council houses, about co-operatives and assured tenancies. However, before we even begin to discuss who should control their homes, who should live in them and what they should do, we must provide the houses that are needed.

Recently, the Housing Centre Trust produced a report that said that 200,000 housing starts per annum were needed merely to tread water. In 1981, total housing starts in the public and private sectors were only 152,700. In 1973, there were 328,500 housing starts. Even in 1977—not that long ago—there were 266,900 housing starts. Housing starts have declined rapidly from 225,200 in 1979 to 152,700 in 1981. The public sector share declined even more rapidly from 81,200 to only 36,900 in the past year.

I am not a great advocate of public housing, but I am an advocate of housing. We cannot allow our housing stock to drop further. It is an insult to people's intelligence for the Government to cut expenditure, as they have since 1979, so that it is impossible for local authorities to carry out rehabilitation and renovation programmes and to build houses, and then suddenly to say, "Spend" just because an election may be approaching and there is some money around.

Local authorities have had to sack most people employed in their planning departments. They have had to run down their architects and building departments. Several of my friends in Lambeth's development department lost their jobs, but they are needed now because the Government say, "Let's spend." Their action is an insult to people employed in local government.

There are twice as many empty houses in London as elsewhere in the country. About 7 per cent. of houses in London are empty, yet, as the hon. Member for Hornchurch said, 70,000 families are registered as homeless in England and Wales. The registration of homelessness is described in the guidance notes to the Housing (Homeless Persons) Act introduced by my hon. Friend the Member for Isle of Wight (Mr. Ross). Single people and childless couples are not registered. The register contains only families, people who are physically or mentally disabled and certain other categories. We do not know how many single people or childless couples are homeless or face homelessness. We do not know the real figure.

I agree with most of what the hon. Member for Hornchurch said about rates. I am pleased that a Tory Member should talk about rates reform. There is no provision in the Gracious Speech for it. After producing a Green Paper, the Government decided that it was impossible to reform the rating system. The Liberal Party has made innumerable suggestions, including site value rating, of which I am not an advocate.

The hon. Member for Hornchurch said that we should examine the possibility of local income tax. I do not agree that there should be a top-up system. Local income tax could probably form the base of a new local government tax structure.

The education picture is equally depressing. The NUT in a recent report said: Teachers are now required to work in filthy, unpainted and ill-maintained buildings. They are asked to handle large, mixed-age classes and to teach subjects in which they are not specialists".

My local education department is keen to stick to Government guidelines. As a result, nine or 10 secondary schools in the north of the borough of Croydon will be lost. Some primary schools are also in danger. The people living in the north of the borough will have no choice. They will have to send their children to the nearest secondary school or to an independent school.

Instead of taking advantage of falling population and school rolls by establishing a bigger pupil-teacher ratio, some schools face having to cope with too many low ability children. In one school in the north of the borough of Croydon more than 20 per cent. of the children are of low ability. That is unfair to them and to the other children in the school. The teachers cannot concentrate on particular groups; they have to lump the kids together. That means that children will not receive the necessary technological education before they can move on to colleges, polytechnics and universities. As a result, the country will not have the educated people that it needs to deal with microchip technology. In a few days we shall receive the cardboard boxes that contain our year books. Those boxes have a small "IT" symbol on the corner. We are in a technological age but we are not providing resources for the future.

The Home Secretary referred to the police. It is unfair that London does not have parity with other police authorities. Every police authority in Britain has a police committee, but London does not have that privilege. There are discussions about how we should provide such a police committee. Some people believe the the GLC should be the police committee, but I do not because the GLC is not representative of London and certainly not representative of the Metropolitan Police area. We must reconsider the function of police committees in the Metropolitan area and elsewhere. We must consider a directly elected police authority for each police force. Those directly elected authorities must consist not only of elected councillors and politicians, because that would politicise the police force, but representatives of voluntary and social organisations. Local education authorities have brought parents and teachers on to boards of governors and thereby widened the spectrum, although sadly they are still not directly elected. We should also have representatives of the police on the police committee

It is no good burying our heads in the sand and saying that we must not politicise the police force and that Ken Livingstone would run the police committee for London. We must resolve the matter sooner or later. If there had been a police committee or even local consultation in 1981, the Swamp '81 operation would not have taken place. I worked in those streets before and after the riot and I could feel a prickliness on the back of my neck, so I knew that something was happening to which the local population was reacting. Had there been proper consultation or a police committee in London, the riots would not have happened, because the local people would have said, "Calm down. Let us carry out the operation properly without lifting the lid off the boiling cauldron."

I am also worried about the fact that we shall have more stop and search procedures. The police already operate section 66 in London. The "sus" laws removed trust of the police from the community. The most important thing to a police authority is the trust of the community. The British police cannot operate without it. If they operate as a bunch of thugs, they are soon held in contempt. The British police operate not as thugs but as a responsible, hard-working and efficient service. However, because of the law that policemen must administer, in many areas confidence in the police was seriously undermined. If we have stop and search procedures throughout Britain, the problems experienced in London with the "sus" laws will recur in Birmingham, Manchester and Liverpool. We must consider positive ways to enable the community to work with the police and to reduce crime, not negative methods of stopping people on the street and causing "aggro". The Home Secretary told us that police numbers have increased, for which we should be grateful. However, although there are more policemen in the Metropolitan area, establishment levels have not increased. Do we have the correct establishment levels in each district? Is that why we must maintain the SPG? It may amuse some hon. Members to know that the SPG recently conducted a burglary prevention campaign in Epsom and Ewell. I hope that the burglars of that district gained from the experience.

If we had a proper police force establishment and a proper beat structure—not only home beat officers who may take 48 hours to walk round territories—we would be able to make progress. I am thinking of the beat structure of the 1950s before the introduction of and obsession with panda cars. Those vehicles were described to me by the district commander in south London as being the most expensive overcoat a policeman was ever given. If we had a proper beat structure, we would be able to remove special units such as the SPG. Such groups would not be needed to rush in to act if we had enough experienced coppers on the ground finding and arresting the villains.

How much of the Gracious Speech is relevant to the urban areas? The Gracious Speech refers to the introduction of legislation to encourage improved and better co-ordinated marketing of British food and agricultural produce. That will be essential for the production and marketing of food, but I am sure that it will be of little significance to the average citizen in Toxteth, Brixton and Bristol.

We are told: A Bill will be introduced to improve the organisation of the water industry in England and Wales. The hon. Member for Reading, North (Mr. Durant) has made an able speech on that issue.

The Gracious Speech refers to the introduction of a Bill to make provision for the construction of a road tunnel across the Conwy Estuary. That will be a significant measure for the people of Conway. The only other significance that I can attach to it is that the Liberal candidate for the Conway constituency will be able to get around his potential consituency much quicker and campaign more effectively in his efforts to become a Member of this place.

Much of what is contained in the Gracious Speech is irrelevant to the needs of the moment, which are to reduce unemployment and to combat the crime rate. The only parts of the Gracious Speech that touch on urban problems are those dealing with the police. I believe that the Government's proposals will make matters worse. The only other area where the Government's record is as bad as that on unemployment is that on crime. The statistics are relentless and familiar.

This is the first time that I have spoken in response to the Gracious Speech. I hoped to be able to respond to it more positively. I hoped that the contents of the Gracious Speech would be a positive commitment to reducing unemployment and to bringing back the rule of law by encouraging the police to act in concert with the people who trust in them. It is sad that the contents of the Gracious Speech do not match that standard. They miss the point almost entirely. I suspect that at the end of this Parliament we shall be in much the same position as we are now, except that the unemployment and crime figures will be far worse.

12.48 pm
Mr. Alfred Dubs (Battersea, South)

I join in the congratulations to my hon. Friend the Member for Peckham (Ms Harman) on her excellent maiden speech. I have had the privilege of knowing her, co-operating with her and working with her for a number of years. I know that she will be a great asset to the House. I know also that she will be a formidable campaigner for the people of Peckham whom she now represents.

I shall direct my remarks to policing, housing in the urban environment, unemployment and the causes of crime. There has been a welcome change in the past year or two because the Conservative Party has ceased to claim that it is the only party that is capable of dealing with crime and law and order. It has ceased to say that because the crime figures have continued to increase despite the Government's efforts to tackle them. It is clear that the Government are not the only people who are committed to tackling crime. We in the Labour Party have an equal commitment, if not a greater one, to this end.

As the Government have discovered, there are no easy answers. It is clear from what the police say—I agree with them—that the main contribution that can be made to solving crime is to achieve better co-operation between the police and local communities. If we achieve that cooperation there will be a higher clear-up rate of crime and a more purposeful movement towards law and order.

I look upon the police Bill that is foreshadowed in the Queen's Speech with foreboding. If it is to contain tougher stop and search provisions than now exist in the metropolitan area, I fear that the consequences will make for worse relationships between the police and local communities, particularly between police and young people in our inner cities, who may be more vulnerable to what may be seen to be powers to give the police the opportunity to harass young people.

Despite what the Home Secretary said this morning about the benefits of the revised police complaints procedure, which I concede is an improvement on present practice, I fear that all too soon the new police complaints procedure that is envisaged will still not achieve what many people have wanted, which is that complaints against the police should be handled and investigated by people who are independent of the police force. I shall say no more about that as there will be opportunities to debate it on the police Bill.

I agree with those who say that it is a desirable aim that there should be more police officers on the beat. However, the Home Secretary should make more suggestions to the police force on how best the police should operate in patrolling local areas. For example, the Home Secretary should state the desirable size of beat for the individual home beat police officer. What is the area that should be covered? Will it cover about 7,000 people? Could it be a smaller area? How best could the police officer on the beat operate more effectively?

The starting point must be the relationship between the police officer on the beat and the local community. If the beat is too large, the police officer cannot be expected to know the local community well enough for him or her to be fully effective. There should be more experiments and more thoughts on that matter. The Home Secretary's ideas should be revealed to us on how the system should operate and how we can improve the way in which police officers operate and patrol their local beats.

A related point, particularly in London, is the age of police officers. It is regrettable that many police officers in London, when they have gained some experience, want to move to other areas where policing is easier. I understand why they want to do that, but the consequence for the Metropolitan Police is a heavier training burden and young police officers on the beat. I wonder whether we are asking too much of young police officers, who are often in their early twenties, when other police forces in the world put much older and more experienced policemen on the beat. We might not be able to do much about that if the pattern of police officers being trained in London, gaining experience and then moving into country areas continues, but if any way can be found of stopping that and of having more mature police officers on our streets it would be an advantage to the local communities. It would also ensure that some of the difficulties on the streets faced by police officers would be handled by men and women who were older and more mature and who had more experience so that they could cope with some of the difficulties.

The Home Secretary said that there had been an increase in the recruitment of black people into the police. That is to be welcomed—not that in itself it will improve relations between the police and local communities, particularly young blacks, but it is a desirable first step to improving such relations.

I should like to see far more blacks being recruited into our police force. I know that there are problems, allegedly from the police themselves, about people not always meeting the standards of entry. No one is suggesting that those standards should be lowered, but we should consider whether the present standards of entry are all essential for policing. Some of the entry requirements may be the result more of history than of present-day assessment of the needs of a modern police force. That point was put to me in the summer when I visited Chicago with the Select Committee and talked to members of the Chicago police force. They were very firm in their advice that one should examine all the standards of entry into the police force to ensure that only those that were necessary were retained. If we dropped some of the others, recruiting might be a little easier and more flexible.

I turn to the rather sorry episode of the aftermath of the Operation Countryman inquiry. We all have the right to demand the highest possible standards from our police. We cannot expect a perfect police force—the police are human and there will always be officers who do not meet those high standards—but we are entitled to demand the highest possible standards. My fear is that the aftermath—indeed, what I think we would all describe as the failure—of the Operation Countryman inquiry has left the strong suspicion that all is not well with the police in London. Therefore, we cannot allow the Home Secretary simply to say that that is the end of the matter and that we can now forget it and move on to other issues.

We need a clearer statement from the Home Secretary than we have had so far about what he proposes to do following the failure of the Operation Countryman inquiry and what steps he proposes to take to ensure that the corruption that people believe continues to exist in the Metropolitan Police will be eradicated through purposeful measures on his part. It is not good enough simply to say that the inquiry is over, the team of 80 police officers involved did a good job, there were a couple of prosecutions and that is the end of it. We are entitled to demand more from the Home Secretary. Indeed, the police themselves are entitled to demand more from him because leaving the matter as it stands is not in the interests of the police themselves.

The Home Secretary mentioned the new consultative procedures, which I welcome because anything that brings the police into closer communication with their local communities can only be desirable. Nevertheless, I should like to regard those procedures as a step on the way to greater and more purposeful accountability. I believe that we have the right to demand that our local police forces should be accountable to local people and should not operate separately from local needs and concerns.

On the related issue of housing and the inner city environment, there has been a dramatic decline in house building, both private and public, in the past three years. In my own local authority area of Wandsworth, house building has virtually stopped. That is a tragedy for the homeless and the badly housed, but it also has another effect in the continuing break-up of our local community. Time and again—all my colleagues who represent inner city areas must have had the same experience—I am approached by people who want to keep their families together but cannot do so. Elderly people have to live far away from their grown-up children and thus lack the support that those children could give them. They are isolated because their children have had to move elsewhere as they could not find anywhere to live near their parents. Conversely, there are children who wish to move closer to their parents but cannot do so. That is tragic, and it contributes to the break-up of our sense of community, which in turn has at least some relationship with the increase in crime in the inner cities.

A further affront that people in inner cities face is the sight of empty houses all around them. Other hon. Members have already referred to this problem. It is impossible to explain to people who need help in finding housing why they are surrounded by hundreds. if not thousands, of empty houses. I do not exonerate any local authority from that, whether Conservative or Labour controlled. It is offensive to the badly housed that there should be empty properties all around them. Whether they are waiting to be improved or to be sold, it is wrong and indefensible that they should stand empty. Those who come to us for help have the right to be extremely angry that nothing is being done. I hope that the recent report by Shelter will concentrate the mind of the Secretary of State for the Environment on that major problem. We need more purposeful measures from both him and the local authorities in the areas of blight.

When I have spoken to the right hon. Gentleman in the past about Wandsworth, he has referred to local authorities controlled by the Labour Party. That is simply not good enough. The problem affects most of our inner city areas, and something must be done about it. I want a clear statement from him that the problem will be tackled urgently. Houses and flats are boarded—so too are shops, many of which are closing as businesses move out. There is an urban blight which is depressing for those living in the areas and which encourages a breakdown in law and order.

The workings of the free market economy, to which the Government pay constant tribute, are leading to a sense of neglect and dereliction in our inner cities. That suggests that the free market economy simply does not work. We need more purposeful intervention to make life and living conditions tolerable in our inner cities.

Throughout London, and certainly in my constituency, properties owned by private landlords are being neglected. They are in a state of decay, which makes the living conditions within them intolerable. People have no choice but to live there. We need purposeful action by the Government and local authorities to tackle the problem. A block of flats in my constituency called Thurleigh Court has been neglected by its landlords for many years. The local authority took many years before deciding to take action to bring the landlords to court and use their statutory powers to compel them to improve the property. The problem is compounded by a difficulty, on which I would welcome the Secretary of State's comments. It is the ability of property companies to disguise who they are and who owns certain properties. Properties change hands where one company acts as a front for another. It is extremely difficult for tenants to know the identity of the landlord or to understand what is happening to their properties. Ownership changes in a mysterious way—possibly to prevent local authorities from using statutory powers against the landlord.

I wish to deal with unemployment and the causes of crime. I do not pretend to analyse the causes of crime; they have defeated every country and every so-called expert. I cannot give an exposition on the subject. However, there must be a relationship between high unemployment and crime. Unemployed youngsters have nothing to do, and so they simply wander about. Inevitably some will fall into trouble.

An individual's self-respect is also important. If he is rejected by society, and if society cannot offer him work, he feels a sense of failure and defeat. Most unemployed youngsters do not want to claim supplementary benefit—they want jobs and self-respect. The sense of rejection caused by high unemployment in itself causes at least some youngsters to turn to lawless behaviour. That is regrettable. I do not condone lawless behaviour, but we must understand the part that high unemployment plays in the increasing crime in our society.

There are other reasons for crime in our society. I believe that the increasing publicity given to violence, and especially the increasing amount of time given on television to displays of violence—often unnecessarily—have changed the values of our society and have made violence seem less reprehensible than it did in the past.

The head of the police in Chicago, to whom I spoke this summer, attributed the increase in crime in Chicago almost entirely to the effects of television programmes. I would not go that far, but I believe that there is a danger in that respect, and that it will be compounded if we have cable television programmes, many of which will come from North America. They will contribute to the lowering of our values through the great attention given to violence.

A second factor affecting the values of our society is what I would call consumerism. On the one hand, unemployment is at record levels, and people on supplementary benefit are still badly off. Yet, on the other hand, they are surrounded by the consumer society, which urges them to spend money on more and more expensive goods, on videos and on holidays abroad. That must produce a conflict in particular in the minds of young people who are themselves rejected by society and have no jobs and yet see society extolling the desirability of being rich and spending a great deal of money on consumer goods.

The conflict that we are generating in the minds of our young people must itself contribute to the increasing number of young offenders. Although I do not think that the Government will be willing to do much about it, we ought to recognise the existence of that factor. We are putting increasing pressures on the young people in our society. Consequently, we have an increasing number of young offenders and an increasing crime rate. It is affecting all of us, whether we live in the inner cities or in other parts of Britain.

1.7 pm

Mr. Gerald Kaufman (Manchester, Ardwick)

Early last Friday morning, the Chancellor of the Duchy of Lancaster and Paymaster General was to be heard on the radio speaking with distress about the disagreeable conditions that he had seen in Peckham when visiting that constituency for the by-election in which the Conservative candidate was so satisfactorily and so soundly trounced. The Chancellor of the Duchy described Peckham as "a disaster area" and "an absolute mess".

My hon. Friend the Member for Peckham (Ms. Harman) will make sure that the problems of Peckham are put before this House in a vivid and compelling way. I congratulate her on her outstanding maiden speech. Those who knew Harry Lamborn greatly appreciated what my hon. Friend said about him. He was a colleague who aroused great respect and affection. Like my hon. Friend, we very much hoped that he would live to enjoy his retirement.

My hon. Friend's speech showed deep concern for the people who have sent her to represent them in this House and a true understanding of their problems. In her speech she vividly illustrated the difficulties that affect those who live in inner city areas, and it is clear that she will be a formidable champion in this House on their behalf.

From time to time, generally for by-elections—as with the Chancellor of the Duchy—but sometimes for other reasons as well, Conservative Members venture into the inner city areas on what for them seem almost to be anthropological expeditions. Like the Chancellor of the Duchy of Lancaster and the Minister of Agriculture, Fisheries and Food, they are always genuinely shocked by what they discover. The Secretary of State for the Environment has spent longer in Liverpool than most Tory Front Benchers have ever spent in such a deprived area and he has been profoundly affected by the experience. However, I know that he would readily admit that, even so, he was no more than a visitor there, a transient on the inner city scene.

Labour Members, who not only represent inner city constituencies, but often live in them too, spend their lives dealing with inner city problems and will go on doing so when the Secretary of State moves on, or is moved on, to something else. We live with those problems and we have to know about them.

For example, my hon. Friend the Member for Battersea, South (Mr. Dubs) referred to council houses that are left empty. I join him in condemning all who are responsible for that, whatever the political control of the councils concerned. It is unacceptable that houses should be left avoidably empty. I also agree with what my hon. Friend said about the derelictions of private landlords, which he knows about in his constituency.

It is because Labour Members live every day with the problems of inner cities that we view with scepticism, if not outright suspicion, some of the initiatives that the Secretary of State keeps dreaming up for the inner cities. Recently, the right hon. Gentleman has taken to revealing these ventures during his speech at the Conservative Party conference—an orgiastic occasion which has lately taken the form of a genuine exercise in compassion. However, even now, the Secretary of State does not completely abjure basic politics. Only he could make a speech at last month's Conservative Party conference containing the following eloquent phrase: off your bottoms, lads. Get on with it. Remember that the leader's eye is on every single one of you". Recently, the right hon. Gentleman has taken to leaving the hard political stuff at the conference to the junior colleagues in his Department, whom he tends to refer to as "my Ministers"—as if he were at least that all-seeing leader or possibly even the Sovereign herself.

The right hon. Gentleman's Ministers are made to draw the short straw. This year, the Secretary of State spoke of that sad figure, the Minister for Local Government and Environmental Services, as the man who has played so outstanding a role in helping me in the Department". Poor fellow! No wonder the Minister for Local Government and Environmental Services feels so desperate as the promised reshuffle once again recedes into the distance, taking with it his chance of escape from the thankless role of helping the Secretary of State at the Department of the Environment. During this Session that role will involve the doom-laden assignment of piloting the Water Bill through what I assure the right hon. Gentleman will be a very painstaking Committee stage.

Let us consider the position of the Minister for Housing and Construction. The Secretary of State told the Conservative Party conference: If you have a problem, write to him—to him, not me. While that hapless pair—the Minister for Local Government and Environmental Services and the Minister for Housing and Construction—get on with the drudgery, the Secretary of State ascends into the stratosphere from which, with a clap of thunder or, at any rate, a standing ovation, emerge his startling initiatives for the inner cities. Here, a garden city to baffle Merseyside—if not to amaze it. There, the appointment, as an adviser, of Mr. Ed Berman, a man previously best known for arranging a 15-minute condensation of "Hamlet" to be performed on the upper deck of an omnibus. That seems to be the only way to get the Secretary of State to set foot on public transport.

I hope that Mr. Berman has left in his abbreviated version of "Hamlet" the line which, if spoken by the Secretary of State, would neatly sum up his three and a half years in office: O, my offence is rank, it smells to heaven.

Those are certainly appropriate words with which to describe the Secretary of State's latest stunt in which his co-conspirator is the Prime Minister herself—the Government's bogus campaign to increase capital expenditure in the public sector. We have to hand it to the Secretary of State. He certainly has a nerve to send out a letter to local councils saying that Ministers have been disappointed to see that, following a large underspend on capital in 1981–82, local authorities in England seem likely to underspend substantially again in 1982–83. This is from a Minister who has a greater responsibility for cutting capital expenditure on housing by local authorities than anyone who has previously held his office. It is no wonder that the hon. Member for Hornchurch (Mr. Squire) had to tell the House that the number of known homeless is now at a record level.

This is from the Minister who lays great stress on the possible use of capital receipts. The hon. Member for Hornchurch highlighted one of the disadvantages of spending capital receipts. There are other difficulties. For one thing, the Government are overestimating the prospects of capital receipts. I understand that their assumption for council house sales in the forthcoming financial year is 160,000. Last year, however, sales were well below that.

Secondly, in the Housing and Building Control Bill that is published today, the explanatory and financial memorandum makes an assumption that capital receipts will be bolstered by 47 per cent. funding of council house sales from private sources. Previous assumptions of private financing have been around 33 per cent. I hope that the Secretary of State, when he responds, will explain how the Government have arrived at this figure of 47 per cent.

Mr. Heseltine

Because various councils, including Labour councils, are now encouraging council tenants to take private sector mortgages as opposed to the available State mortgages.

Mr. Kaufman

I am grateful to the Secretary of State for saying that he is now making a precise guess of 47 per cent. What interests me is not why he is speculating but why the explanatory and financial memorandum contains this extraordinarily precise figure of 47 per cent. We should like to know the mathematical assumptions on which the right hon. Gentleman bases those statistics. The House has a right to know, if not from the Secretary of State today, then in the speech that he will make when moving the Second Reading of the Bill.

After all, this is the Minister who has cut HIP allocations for local authorities four times since coming to office so that they are now 54 per cent. below their level when Labour left office. This is the Minister who imposed a six-month moratorium on all local authority capital projects in housing—a moratorium that ended only last year. This is the Minister who, instead of giving local authorities and housing associations the chance to build houses, is forcing them to sell them off and who, in his new Bill published today, is extending this forced sell-off to charitable housing associations.

I support fully the plea made by my right hon. Friend the Member for Norwich, North (Mr. Ennals) on behalf of the almshouse charities to which I hope the Secretary of State will respond. The right hon. Gentleman is forcing more housing associations to sell off houses. Yet this is the Minister who, as recently as a few weeks ago, imposed a three-month moratorium on new building schemes for housing associations. In September, he imposed a moratorium on new building schemes for housing associations. Now, in his ministerial statement issued on 27 October, he says that he will be discussing with the chairman of the Housing Corporation whether it would be possible for housing associations to make use of additional resources in the current year. We have moved from moratorium to spend, spend, spend in four short weeks. That is an illustration of what a phoney campaign this is. The Secretary of State and the Prime Minister are urging local authorities, as winter comes on, to spend £1 billion on capital projects within the next four months.

Perhaps the Secretary of State will say how this is to be achieved. There is no doubt that it will be helpful to the president of the Royal Institute of British Architects, Mr. Owen Luder, who is reported in the press as saying: We say it is just not possible to get the billion pounds spent in time. If we do, there will be some damn silly decisions taken to get it spent"— [Interruption.] I am glad to have that confirmed by the Minister for Local Government and Environmental Services.

It is the duty of the Secretary of State in this debate to clear up the confusion among local authorities that was caused by the Prime Minister on Wednesday—a situation to which my right hon. Friend the Member for Norwich, North referred, as did the hon. Member for Hornchurch. The Prime Minister said: I have therefore written to the local authority associations and to the group of nationalised industries chairmen urging them to make full and proper use of the sums we have allocated to capital—not, I stress, to increase their total expenditure but to make proper provision within that total for capital investment.

Will the Secretary of State say whether that means that they have to reduce their current expenditure pro rata with their increase in capital expenditure? If it does not mean that, what does it mean? The Prime Minister's words are quite clear.

The right hon. Lady went on: I urged local authorities to spend on capital the sums allocated to capital within the total capital expenditure that we have budgeted for … I am talking about capital expenditure within the total amount that we have budgeted for. Therefore, no question arises of extra expenditure." [Official Report, 3 November 1982; Vol. 31, c. 21.]

Will the Secretary of State reconcile those words of the Prime Minister two days ago with the statement in his letter to local authorities of 29 October which reads: All Government Departments will be prepared to consider applications from local authorites for additional capital expenditure allocations for 1982–83 where these are necessary to facilitate new capital investment which could not otherwise be achieved this year. Authorities are invited to submit bids as soon as possible. We want from the Secretary of State an explanation of how the words in his Department's letter to local authorities can be reconciled with what the Prime Minister said—[Interruption.]

Since the Secretary of State seems to be so happily confident that he can explain that, will he also answer the question which, above all, is troubling local authorities? In his letter of 29 October, he said explicitly that local authorities will also be expected to bear the revenue consequences"— that is, of their additional capital expenditure— without amendments to GREAs or targets. Will the Secretary of State now say what that means for the servicing of borrowing? Many people want to know.

Will the Secretary of State be explicit and admit on the record what, two days ago, his officials were admitting off the record, namely, that increased current account expenditure consequent on the increased capital expenditure demanded by the Government could lead to local authorities being pushed into the overspending zone and therefore suffering rate support grant penalties if they were trusting enough to do what he and the Prime Minister were advising them to do? The Secretary of State had better explain that because local authorities are worried, the hon. Member for Hornchurch is worried, and the House and all those involved want to know.

If that assumption is valid, it is particularly hard for the inner city areas, for which the Secretary of State purports to feel so much solicitude. Already the 29 partnership and programme authorities face grant penalties of £46,520,000 as soon as Parliament approves the Rate Support Grant Supplementary Report (England) (No. 2) 1982 which now stands on the Order Paper.

Mr. Ennals

Will my right hon. Friend ask the Secretary of State about the timing of this operation? If the Secretary of State and the Prime Minister wish the money to be spent, why did he not say so three or six months ago, rather than waiting until now?

Mr. Kaufman

I can give my right hon. Friend the answer to that. The whole sorry charade arises from the Prime Minister's meeting with the Group of Eight, after which she got into a great state as a result of what she was told about the effects of her and the Secretary of State's actions upon the building industry. The Prime Minister told the Secretary of State to go away and do something about it. The Department of the Environment then scraped up this absurd and nonsensical scheme.

The Prime Minister is getting into the way of doing this kind of thing. Only a few days ago she sat on the Front Bench while my hon. Friend the Member for Holborn and St. Pancras, South (Mr. Dobson) validly and eloquently raised the problem of the Great Ormond Street hospital in his constituency. Away she went and the next day there was another £100,000 for that hospital. That is something on which I congratulate my hon. Friend. That is the attitude that the Prime Minister is now taking while her mind dwells more and more on the date on which she will ask the Queen to provide her with a dissolution of Parliament.

We have an order before the House now which is imposing £46½ million in rate support grant penalties on 29 inner city local authorities in Britain. Liverpool, to which the Secretary of State is specially assigned, will lose £5,380,000 in grant penalty. Birmingham, to the representation of which we welcome my hon. Friend the Member for Birmingham, Northfield (Mr. Spellar) will suffer even more, as will Manchester and Sheffield.

Since Labour left office those inner city local authorities have suffered a 16 per cent. cut in real terms in rate support grant. In the next financial year they face a further cut of 12.8 per cent. and that is before any further penalties that the Secretary of State may impose.

In two years Merseyside has lost 10.9 per cent. of its rate support grant. Liverpool alone has lost 13.9 per cent. Some authorities in deprived areas have fared worse than that. Salford's rate support grant is down 15.3 per cent., Birmingham's and Gateshead's are down by 17.4 per cent., Manchester's is down 24.6 per cent. and Newcastle upon Tyne's is down an utterly intolerable 34 per cent.

All the district authorities have lost large sums in housing subsidy as well. The cumulative loss is enormous. In the last financial year the partnership authorities alone lost £275 million of Government aid in reduced rate support grant, housing subsidies and urban programme grants. At the same time, the amounts that they are being allowed to spend are being drastically cut. In the current year their spending ceilings are so low that all but one of those 29 authorities are overspenders according to the Secretary of State's criteria.

On the basis of the present rate of inflation those authorities are being told that in the next financial year they must cut spending by another 5½ per cent. Therefore, after the capital expenditure spree which the Secretary of State is urging them to indulge in this year, will come the reckoning next year when they try to use what they are now being egged on to build. That was made clear yesterday, when the Royal Institute of British Architects' council heard of two brand new old people's homes in Hereford and Worcester that have been boarded up because the council cannot afford to run them. That is what will happen if local authorities manage to take up the Secretary of State's offer. The spending ceilings already announced, which he says he will not revise for the forthcoming year, will push them down on current expenditure. It may be news to the Secretary of State that it is impossible to run old people's homes without staff who are paid on current expenditure and without providing meals that are paid for on current expenditure. The Secretary of State's oppressive spending ceilings will prevent that.

Yet, as the Secretary of State must know, the inner city areas are not only suffering under the burden of Government grant cuts, and Government spending limits and penalties, but are having to cope with the double distortion of low resources coupled with extra demands on them from those who do not help to pay for what is provided from them. Large cities, such as Manchester, Liverpool, Birmingham, Sheffield and Newcastle upon Tyne—to take only five examples from a long list—are cultural centres for their regions and provide specialised facilities, such as reference libraries, which are used by vast numbers of people from the surrounding areas. The same is true of their museums, art galleries and subsidies to live entertainment. In Manchester, our ratepayers help to subsidise the excellent Palace and Royal Exchange theatres, as well as our internationally renowned Halle orchestra. All those attractions are enjoyed by those who come from out of town and whose ability to pay is far higher than the resources of the Manchester ratepayers who help to make them possible.

That is one reason why the major urban authorities are thrust into the category of overspenders. The other reason is the changing face of our principal cities. Children of school age make up a far lower proportion of the total population of those cities than in the nation as a whole. Unemployment, particularly male unemployment, is far higher in those cities than the national average and the ratio of households with children to which supplementary benefit is paid is again far higher than the national average. Affluence, as measured, for example, by car ownership, is well below the national level. In those cities, more elderly people live alone, there are more children in one-adult households, more children in care and, often, more overcrowding. That is true of those cities taken as a whole.

The recorded levels of deprivation are even higher in the designated inner city areas within those cities' boundaries. Unemployment is even worse and youth unemployment is devastatingly bad. There is an even higher proportion of children in one-adult households, there are far fewer 17-year-olds in full-time education—the one is an inevitable consequence of the other—and there is even worse overcrowding and even greater poverty. In inner Newcastle, at one end of the scale, youth unemployment is 26 per cent. above that city's already grievous average. At the other end of the scale only 25 per cent. of households have a car.

Those statistics conceal countless stories of human want and deprivation, known to all of us who have the responsibility of living with such problems every day of the year and of trying to help those afflicted by them. They are the people most in need of municipal services, and it is they who are least able to finance them. They are suffering disproportionately and most grievously from the Government's heartless policies. Yet the Secretary of State will be speaking the truth if he states that money alone cannot solve the problems of the inner cities. He will be right if he points out that often money that has been ill-spent has made the problems even worse.

The Secretary of State would be misleading the House and himself if he concluded that he is justified in forcing down expenditure in our inner cities and in withdrawing grant to force down expenditure by local authorities which try to meet the needs of their people, as he penalises the authorities that I have listed.

Money alone will not solve the problems of our deprived urban areas, but without money—let us be clear that that means public money; yes, taxpayers' money—the problems will never be solved. I think that the Secretary of State knows that. His initiatives with private capital, instead of being a useful addition to public expenditure, are the substitute that he has adopted because his Cabinet colleagues refuse to agree that he should have the funds that he needs if any real impact is to be made on the malaise of our inner cities.

Because people in the inner cities know that they can hope for nothing from this Government they reject the Government overwhelmingly at the polling booths whenever they are given the chance. For that reason too the Queen's Speech signally and lamentably fails to meet the need that we all know exists.

1.35 pm
The Secretary of State for the Environment (Mr. Michael Heseltine)

The right hon. Member for Manchester, Ardwick (Mr. Kaufman) was not on his best form. I do not expect much in the way of content from his speeches, but I do expect some good jokes. Today he did not even tell any jokes.

It is depressing to listen to the right hon. Gentleman and the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) because they give the impression that the inner city problems started about three years ago and that the problems with which this Government are grappling, which are similar to the problems experienced throughout the Western world, came into existence with the election of the Tory Administration.

Anyone with any understanding of the scale of the problem and the evolution behind it realises that to discuss it in that context and to see it so much from one side makes the prospect of a solution impossible.

Mr. Ennals

Will the right hon. Gentleman give way?

Mr. Heseltine


I agree with what right hon. and hon. Members have said about the hon. Member for Peckham (Ms. Harman). I feel marginally churlish that I did what I could to try to stop her coming here, but, having failed in that endeavour in my visits to her constituency during the by-election campaign, I must say that I was impressed by the quality and generosity of her contribution today. She carried out her responsibilities well in referring to her predecessor who was taken from us suddenly and is sadly missed. We all echo the hon. Lady's sentiments in that respect. There was a tradition that maiden speeches were non-controversial. I cannot agree with most of what the hon. Lady said, but she said it as well as any maiden speaker in the House. There is no doubt that she will make a considerable contribution to our debates, in the context of the political party which she supports.

As I listened to the Opposition Front Bench speeches, I could not help remembering the realities of the programmes that the Government inherited. Opposition Members suggest that we should encourage local authorities to increase their current expenditure and take on more staff because that will contribute to solving the inner city problems. By 1979 local authority staff levels had reached their highest level ever. During the period of office of the Labour Government there was no sustained exception, although there were momentary hiccups, to the growth of the past 30 years in local government employment. Yet it is interesting that the problems with which that employment was supposed to grapple became worse and, as the staff bills increased, the capital programmes—which have a part to play in inner city problems—were halved. All those who spoke in support of the Opposition case today were members of the Government who, in order to pay the staff bills, halved capital programmes between 1975 and 1979.

Mrs. Shirley Williams

The Secretary of State is correct. The capital investment programme for housing and water has fallen for the past six years and has continued to fall under his Government. How can the investment be protected?

Mr. Heseltine

The right hon. Lady must realise that I am the first Secretary of State to reverse the trend. The local authority housing programmes were increased by 6 per cent. this year, which is the first increase since 1975. I would be the first to say that the increase should be higher, but, against a background in which the Labour Party systematically cut capital programmes to pay increased staff bills while watching the inner city problems accumulate and the conditions deteriorate, Labour Members cannot suggest that if we returned to their policies we should begin to solve the problems.

Although the right hon. Member for Crosby (Mrs. Williams) has distanced herself from her former colleagues, when in office she supported those policies. She talked about the housing difficulties that she has experienced on Merseyside, but those difficulties reached their present stage under successive Governments. If the right hon. Member for Ardwick, who was in the Department of the Environment, did not know about it, that is no excuse, but he always tells us that he is a member of a party that represents people who live in the inner cities. I cannot understand why those conditions were allowed to go unchallenged and unchecked by the Labour Government.

We must stop talking about inner city problems as though they suddenly started in 1979. We must remove dogma from the debate if we are to begin to grapple with the real problems. Whichever party had been elected in 1979, it would have been forced to face the restraints of the world economic recession. There has been no escape from economic problems for the Socialists in France or the Social Democrats in Germany. We are faced with the same recession and we find that the barometer of stress in unemployment is rising. There is no evidence to suggest that we have a doctrinal panacea that will be used to replace the Government's policies to bring immediate relief to the inner cities.

We are restrained in what we can afford and public expenditure in all countries faces that test. We did not escape it when the Labour Government were in power, nor have we escaped it under this Government. However, we have tried to face up to the systematic stresses implied in those restraints, and the benefits of doing so are beginning to show in lower inflation, although we still have the traumatic problems of unemployment in Britain and in all Western countries.

If that is true—I believe it to be undeniable—the Government must use every ingenuity to find resources from the public and the private sectors. There are two ways in which we can do that. One is to get better value for money from the public expenditure that we can afford, and the other is to enter into as many genuine partnerships with the private sector as we can devise.

I listened with interest to what the right hon. Gentleman had to say about value for money in the public sector and the pressures that I am exerting on local authorities. He used various adjectives to describe the harshness and difficulties that I am producing. Curiously enough, the Labour leaders of the provincial cities saw my right hon. Friend the Minister for Local Government and Environmental Services and myself only recently. They advanced the same arguments as those adduced by the right hon. Gentleman. For example, the right hon. Gentleman talked about libraries. The Labour leaders had a cogent case. They argued that the provincial centres must provide new, larger and better services. They alleged that the Government were destroying an essential part of the cultural heritage.

In politics we can use airy and assertive phrases that are little substantiated by the facts. It so happens that local government treasurers have blown the debate wide open. They have produced a document which shows authority by authority and service by service the cost of providing various services. When I listened to the Labour leaders talking about the special costs they face, I turned to the figures. The variations in the costs of providing services authority by authority are measured in terms of 100 per cent. It is impossible to pretend that it is necessary to spend what in unit terms in Manchester is 1.09 staff per 1,000 population whereas in Liverpool it is 0.88 and in Birmingham it is 0.68. It cannot be argued that there is not an opportunity for the Mancunians to do it a bit cheaper.

Mr. Kaufman

It is obvious that the right hon. Gentleman does not use a public library. If he and his colleagues did, they would realise that the number of staff governs the hours during which the libraries can be open. Manchester has good staffing ratios, so it can keep its libraries open longer than those in the other areas. If an area has a great many unemployed within it and many members of the ethnic minorities, the libraries must make themselves available to those who need to use them.

Mr. Heseltine

Like the right hon. Gentleman, I have an extremely effective library provided for me by public support as a result of being a Member of Parliament. That means that I do not have recourse to the libraries to which he refers. It is interesting that the instant rationalisation that the right hon. Gentleman produced was not produced by the Labour leaders. I should be fascinated to study a detailed analysis that substantiated his contention. No one has produced it so far. We return to the issue of assertive politics. That means saying something that appears to be reasonable to defend figures which are themselves innately unreasonable.

My argument is that there are endless opportunities for economies in the current consumption of local government which can be achieved on a value-for-money basis without reducing the resources provided for the services. It is the failure to do that which has put such pressure on capital programmes. As I have said, the Labour Government cut them in half. They failed even to begin to grapple with the problem.

It is necessary for us to look to the private sector as well as the public sector to try to achieve desirable objectives in the inner urban areas. The public sector will play a key role. The urban programme—curiously enough, it owes its origins to the Department of the Environment under my right hon. Friend the Member for Worcester (Mr. Walker), who is now Minister of Agriculture, Fisheries and Food—stemmed from the inner city studies that were set up in the early 1970s. The programme was initiated under the Labour Government. It is now running at its highest level at £270 million. It was designed specifically to deal with stress areas. The Government have increased the programme significantly and I am proud to be able to make that claim on behalf of the Government.

There is a range of other things that we have been doing in the public sector, again in partnership with the private sector. There has been no serious attempt to equal what we are doing in the East End of London or on the south docks on Merseyside to grapple with the dereliction about which the Labour Government did nothing. The south docks on Merseyside are one of the scandals of modern Britain. The dereliction in the East End of London over the past 30 years is indefensible.

There was a lack of opportunity in those areas until the Government came to power and poured resources into them on a scale that eclipsed the concentration of effort that was made by any other Government. That is to the great credit of the Government's urban programmes.

It is disappointing to hear the festival that is being arranged in Merseyside for 1984 being derided by Opposition Members as if it were irrelevant. It is not true to say that if one reclaims 250 acres of inner city Liverpool to the highest environmental standards and uses six months to draw tourists and visitors to the city, preparing for when there will be the best housing and industrial land on offer in inner city Liverpool of anywhere in this country, one is missing the purpose of inner city regeneration. Anyone going to Liverpool today must be aware that there is a concentration of effort and resources in that city which is without precedent in post-war Britain. The Mersey festival and the reclamation of the docklands is a classic example.

The London docklands will get a light railway scheme. It has clamoured for connections with the West End and the heartlands of London for as long as I can remember. The Government produced the funds and made the decision to go ahead on the light railway connection. There has been a largely public sector housing programme in the East End for many years under boroughs dominated by the Labour Party. That programme has now been balanced by a private sector contribution.

Far from the people of the East End of London turning their backs on that opportunity, as we were told they would, or failing to respond to it because they did not want it, we find that 40 per cent. of the houses that are being sold there are being sold to local tenants or people on the housing waiting lists. The much more important thing that is happening under the Government is that, instead of the young, talented, trained and skilled leaving the inner cities and leaving behind the ageing generations who will become the pensioners of our society, we are creating an environment in which people can buy their homes so that they may live in the community in which they were brought up, thus creating a balance in society that the policies of the Labour Government did much to destroy.

That is why there is a new sense of opportunity. It is in its infancy. I would be the first to say so. The problems are gigantic. One cannot begin to understand them unless one appreciates the long, historic drift of power and resource away from our inner cities as a result of the communications and transport revolutions and the institutionalisation of industrial ownership that has taken place over the past 50, 60 or 70 years. Those are the trends that have brought about the crisis in the inner cities. We must understand those trends and begin to redress them, and we must use every possible resource to do so.

I can go further. We announced and pioneered the urban development grant. I was amused to hear the right hon. Member for Ardwick calling upon me to copy the American example about a month after I had announced full details of how we had already done so. The American inner cities faced much the same traumas as we face, a decade and a half before we did. The American Government harnessed the resources of the private sector in partnership with the public sector by putting on offer public expenditure programmes and inviting the local authorities to add to those programmes private money that they could raise locally.

We decided to pursue that concept by announcing that next year we would make available about £70 million of partnership money, which would have been spent anyway. There is nothing extra about that money. Within the £270 million as adjusted for next year we would have spent £70 million on partnership programmes. Instead of just spending pound, pound, pound within the public sector and nowhere else, we put the money on the table and told the people to go out into the private sector and find out what they could add to it.

The result is one of the most exciting pieces of news for the inner cities that we have heard since they became a major priority. The local authorities bid for £200 million as opposed to £70 million. Some 250 schemes have been proposed. In addition, £550 million has been found in the private sector. That makes a total of £750 million of money that is tailored to the needs and opportunities in inner cities. I do not suggest for a moment that that scale of money will flow next year. Some of the schemes are not suitable—we have yet to appraise the details—and some will be spread over two or three years. Nevertheless, by fusing the public and the private commitment we shall achieve, first, an unparalleled flow of investment funds into the inner cities and, secondly, the fusion of resources of the public and private sectors. We have also done this with the derelict land scheme. The figures have not yet been announced, but they will shortly be finalised. Instead of simply providing public money to clean up derelict land, we want to know to what private sector uses the land will then be put. By gearing the money in that way, we are attracting substantial additional resources into the inner urban areas, to which we have swung part of the derelict land programme in a way that did not previously occur.

Throughout the inner cities, one authority after another—Labour, Conservative and Liberal led—are taking a new approach to relationships and attitudes in the public and private sectors. Often this has been forced by the pressures of the world recession and the need to produce programmes, as the public sector has been forced to do throughout the world, but it has also come about because the Government have made it a cornerstone of their policy not to spend on programmes unless the private sector is fully informed and consulted as to how the money will be deployed by local government.

We now see the enterprise agencies, the growth of businesses in the community and substantial and exciting developments in the small industrial and commercial sphere which is doing so much, albeit under the cloud of recession, to improve the longer-term prospects of these areas. The enterprise zones are now showing real success—so much so that the 11 initially announced are to be increased. The fact that a very large number of authorities are bidding for these zones is the surest possible demonstration that the idea has proved its worth.

Mrs. Shirley Williams

Will the right hon. Gentleman address himself to the other side of the matter? Enterprise zones may be creating firms, but in Liverpool liquidations and bankruptcies consistently occur with the loss of many more jobs as a consequence. I have already made the point about the urban grant, which has offset a great deal of the effects of the inner urban programme, to which the right hon. Gentleman refers.

Mr. Heseltine

I have constantly acknowledged that there is no escape from the world recession. There would be no profit in either the short or the long term in the Government indiscriminately subsidising companies that cannot remain viable. That would merely put at risk their competitors, which are more efficient and able to remain viable and which we hope will one day provide the basis for recovery. Therefore, heartrending though it is—all hon. Members must face this in their own constituencies when companies say that they cannot survive—to have to say "No", as I must on Merseyside and other hon. Members must elsewhere, there is no practical, rational alternative to the schemes that the Government already administer. No party could do other than what we are doing, any more than the right hon. Member for Crosby or other Opposition Members, when they had the lonely job of taking decisions, could prevent unemployment from rising to 1½ million. I do not think that they wanted that to happen, but it was out of their control. When they left office, we inherited the legacy of a rising trend in unemployment. I appreciate that that has not changed.

Mr. Kaufman

It has doubled.

Mr. Heseltine

I was referring to the trend. The circumstances that the world is facing have engulfed the whole world economic system. Everyone knows that. There is no point in trying to pretend that some magic solution can be found in the Opposition's policies.

We have heard a great deal about housing, and rightly so. I anticipated my remarks to some extent by pointing out that this Government are the first since 1975 to reverse the trend of housing decline in the public sector that we inherited. There are now also significant increases in private house building.

Mr. Kaufman

Will the right hon. Gentleman abandon once and for all his attempt to mislead the House with regard to housing investment programme allocations? Time and again, he and his hon. Friend the Minister for Housing and Construction try to tell us that they have reversed the trend of reduced housing investment programme allocations, but they have done no such thing. The housing investment programme allocation for the current financial year is lower than that for the past financial year. The only way in which the Secretary of State can claim that he has added resources is by adding the notional capital receipts. The basic HIP this year is lower than last year, and last year's was lower than the year before. Will next year be lower than this year?

Mr. Heseltine

Has the right hon. Gentleman ever thought through the precise effect of the juxtaposition of those two figures on local authority accounts? In one case, the allocations are simply an authorisation to borrow more money. In the other, the capital receipts affect the level of borrowing because it is a positive cash flow. If the right hon. Gentleman thinks that it makes the slightest difference which way they obtain the two authorisations, he has not thought through the impact on local authority finances. As long as they have the discretion to spend, as they do as an aggregate of allocations and capital receipts, that is all the authorisation they need. It does not matter from which source it comes. It goes back to the right hon. Gentleman's myopic view. He thinks that all that matters is authorised public expenditure from central Government. I am concerned to draw in the resources of the private sector. If council houses are sold with the use of mortgage money from the private sector, that enables a positive cash flow to go into the local authority housing accounts. We were elected to encourage local authorities to spend money on improving council properties for the better use of people in their areas. There is no inconsistency in my remarks.

Mr. Kaufman

Will the right hon. Gentleman admit now that the basic HIP allocation for this year is lower than that for last year? Will he also admit that the basic HIP allocation for next year will be lower than for this year?

Mr. Heseltine

The figures for next year are yet to come. We all know exactly what the right hon. Gentleman thinks they will be. We shall examine his accuracy when the figures are announced. There is no point in pursuing academic statistics to try to make a wholly irrelevant party political point. That is what the right hon. Gentleman is doing. Indeed, he is doing even worse. By concentrating on the wrong figure, he is trying to focus the minds of councillors on a lower level of spend than that to which they are entitled. I wish that he would wake up to the fact that a massive resource is available to local councils to spend because of the contributions from capital receipts. We must move into the world that exists today, not the one that existed when the right hon. Gentleman served in the Department of the Environment.

Many new initiatives in housing are providing the basis of a social revolution in our inner cities—whether it be low-cost home ownership, part purchase, homesteading or the improvement-for-sale schemes. There is now a much wider range of choice—which is being taken up by both Labour and Conservative authorities—than we have ever seen before. That will be added to by the Housing and Building Control Bill, which will fulfil the Government's commitment to extending the right to buy to 50,000 public sector tenants living in leasehold property. I know that my hon. Friend the Member for Hornchurch (Mr. Squire) is especially keen to see the right-to-buy scheme developed. I was asked for the figures. We are approaching 600,000 applications under the right-to-buy scheme. My guess is that within the period of this Parliament about 1 million people will be living in homes that they bought through the Government's legislation. The Bill will extend the right to buy to 80,000 tenants of charitable housing associations and trusts, whose dwellings were previously provided predominantly from public funds in the form of housing association grants. I am afraid that the Bill will not help the right hon. Member for Norwich, North (Mr. Ennals), as we shall not amend the 1980 Act in the way that he suggested.

Mr. Ennals

Will the right hon. Gentleman say something further about almshouses? Surely he must have had representations from others, apart from those in my constituency, who feel that they are being subjected to bureaucratic pressure, to which they are not accustomed.

Mr. Heseltine

The right hon. Gentleman and his local councillors in Norwich have their own views about the ownership of public sector properties. I take a different view on behalf of the Government. He knows that the issues have been well ventilated and that the Government have no new initiatives. We are well content with the present position.

I return to the points raised by my hon. Friend the Member for Reading, North (Mr. Durant) and the right hon. Member for Crosby on the problem of trying to get a better standard of management on council estates. This is the first Government to legislate to give council tenants the right to a charter. One part of it is the right to buy their homes. The other part is the right to be involved in and consulted about many aspects of their lives. That never happened under the Labour Party, which claims to represent those people and has had every opportunity to do so.

I am the first to say—largely because of unfamiliarity with the standards and practices that are necessary—that local government has not moved as fast in this area as I would like. Praise was rightly given to the work of Anne Power on the priority estates programme of my Department, where we are trying to show what can be done by best practice. The community refurbishment scheme, in the constituency of the right hon. Member for Crosby, is immensely rewarding, involving about 500 houses. We are taking people off the unemployment register and, through the Manpower Services Commission, they are now at work repairing homes within the community in which they live. It is having the most significant response from the tenants. I am proud to have played a part in devising that scheme.

After the debate I shall be going to Merseyside to take part in a press conference at which I shall announce another initiative on which I have been working with the Labour-controlled borough of Knowsley. It is a way forward and an opportunity that will bring considerable benefit—if the initiative is approved after consultation—for the tenants of about 3,300 council houses on a post-war estate known as Cantril Farm.

The housing conditions are deplorable on Cantril Farm. The local authority, like every local authority, is limited in what it can afford, so an arrangement has been reached with Barclays Bank and the Abbey National Building Society whereby they will buy that estate into a private trust. The trust will be established with the co-operation of the borough council. The leader of the council wall be a member of the trust, one of the tenants will be on the trust, and so will the chief executive of the Abbey National Building Society and a senior representative of Barclays Bank. The private sector will provide the finance with which the estate will be refurbished, in partnership with the Department of the Environment through the urban programme, and the Housing Corporation will be involved.

It is a new world in terms of what will be possible for the tenants concerned. They will not be made to do this or that. They will be given a break. A considerable sum of private money will be involved. Is that wrong? Should we not have done it? The whole House will appreciate that there are ways forward, involving the people and giving them a share of a new opportunity, both as tenants arid as owners, which have previously been denied them. That is a major criticism of Governments of all parties in post-war Britain. I believe that the House will welcome that development. It is a manifestation of our determination to give help where we possibly can.

I shall try now to deal with the financial matter that was brought to my attention by the right hon. Member for Ardwick. It is not the easiest subject with which to deal at the Dispatch Box but I shall clarify it as simply as I can. It relates to whether the level of capital spending that the Prime Minister and myself and my colleagues have been trying to stimulate is likely to have an impossibly adverse effect upon the current revenues and trading position of local government, and the penalties associated therewith.

There is no way in which we think or have tried to suggest that £1 billion can be spent above programmes between now and the end of March. That would be a preposterous concept. But we believe, and all Governments have always believed—the Ministers concerned may not have known, but their civil servants have always practised it—that there is always discretion at the end of the year, even if it is only a matter of bringing forward from April next year into March this year schemes which are waiting to start. A significant number of schemes in one authority could start if there were flexibility to move from one authority to another. It has gone on from time immemorial under all Governments. If there is an underspend developing on capital account, the civil servants usually try to adjust matters to get as close as they can to the detailed programmes that the Cabinet has approved. That is broadly what is happening now, but it is happening on a bigger scale because the underspend is bigger than we have had before.

There have been several large underspends on capital account in local government. One of the largest occurred in the final year of the previous Government, when the right hon. Member for Stepney and Poplar (Mr. Shore) had, I believe, about £400 million underspend on capital account. Last year we had a £600 million underspend and this year it will be over £1 billion.

The explanation for the underspending is simple. The sale of assets and of council houses has generated substantial amounts of cash which local authorities are not used to taking into account in their projections of what they should spend. They are used to the Government telling them what they should spend. They have not got used to the enormous sums that are coming into their accounts and the right hon. Member for Ardwick is obviously still thinking in terms that were familiar to him when he was a Minister in the Department of the Environment.

The Government do not discover what is happening until well into the financial year, because we have to await the returns from local government. Returns are submitted quarterly, with the first being drawn up in June. We do not see much of them until the end of September, when we have to appraise and check them. By that time, it is difficult to do anything about the level of capital spending in the current year. One cannot do that much, but one can do something, and Governments have always tried to do something.

The Government have set precise targets for local authority current expenditure. Each authority knows exactly what we think is appropriate for it to spend. The targets are laid down authority by authority to the nearest £1,000 or so. If authorities get much greater capital receipts they can put the money on deposit or use it to repay loans, which will give them a current bonus in terms of the interest saved on the capital account.

If an authority switches that interest bonus into its current account, it will not be under the same pressure to make the current account savings for which we have asked. Councils can rightly say that if they push up the capital account they will incur our penalties, but if they had achieved our targets and then the capital receipts came in, they could increase capital expenditure to take up some of the facility that is available to them and would remain within our targets.

The authorities that are hitting our targets on current consumption will not face penalties, and a substantial number of authorities are in that category. Of course, they are not the sort of authorities that the right hon. Member for Ardwick wants to talk about. He wants to discuss the overspenders—the conspicuous authorities that often make a virtue of their expenditure levels. However, I have explained the facts and they vindicate the Government's view that many authorities could spend part of their capital receipts without the risk of incurring penalties from the Government.

The right hon. Member for Ardwick asked about the other revenue consequences that flow from capital expenditure. He is right to say that we cannot build a school or an old people's home without staffing consequences. However, many capital projects do not have such staffing consequences, although they all have interest charge consequences. For example, home improvement grants and derelict land projects do not have such staff consequences. Many infrastructure programmes on local government's capital account do not have those staffing consequences, except minimally in connection with scheme designs.

I hope that that explains the situation. What the Prime Minister said is compatible with the explanation that I have given to the House. It is possible for local authorities to increase their capital expenditure in many cases without running into penalties from the Government.

Mr. Kaufman

I am deeply grateful to the right hon. Gentleman because he has given the game away completely. The Secretary of State says that it will be all right for local authorities if they do not go above the target ceiling that he has laid down for them. However, he knows that in the last financial year 61 per cent. of the local authorities that went above the ceilings were Conservative-controlled authorities. They found it impossible not to go above the ceilings.

On the current ceilings, 56 per cent. of the local authorities above them are Tory-controlled authorities. They got out of it to a large degree, though far from totally—the Secretary of State's report which we shall be debating later this month still penalises 98 local authorities—because he gave them GREA exemption. What those authorities need to know, on the basis of what the Secretary of State has now told the House, if the right hon. Gentleman will listen—it is the case, I understand, that he did not know and his right hon. Friend the Minister for Local Government and Environmental Services was telling him—is whether the Secretary of State is going to change his mind.

The Association of County Councils and others have asked the right hon. Gentleman if they will get GREA exemption in the next financial year. So far, he has been telling them that they will not. Is he now saying that they will have the GREA exemption? If not, there is scarcely a local authority, Labour, Conservative, Liberal or under any other control, that will dare to incur the kind of expenditure that he has mentioned because of what he has said about the current account bonus.

The Secretary of State says that home improvement grants, for example, do not carry revenue consequences. The right hon. Gentleman must be aware that for a home improvement grant to be carried through, the application has to be processed, the work inspected and final payment made. Local authorities will need to take on more staff if they are to carry out what the Secretary of State has proposed. Staffs of local authorities are working to their uttermost limits at the moment, as the Secretary of State should know.

Thirdly, the really big giveaway by the Secretary of State is his admission that this is not an addition to expenditure at all; it is simply a bringing forward of expenditure from the next financial year. His letter makes it clear that if expenditure goes into the next financial year, it will have to be deducted either from capital receipts, the 10 per cent. year-to-year tolerance, or the 1983–84 allocations. The right hon. Gentleman has admitted what the Prime Minister was unable to understand. He is pushing local authorities into the penalty zone on revenue consequences. This hugely trumpeted initiative is simply bringing forward expenditure, not adding to it.

Mrs. Shirley Williams


Mr. Deputy Speaker (Mr. Bernard Weatherill)

Order. That was a very long intervention.

Mrs. Williams

Could not the loan charges and interest rates be wrapped up in the capital allocation? I appreciate what the right hon. Gentleman has said. It is, however, a complicated issue for many authorities to grasp in the time available.

Mr. Heseltine

The right hon. Lady will understand that local government treasurers grasp these points with an alacrity that is impressive. They are also very fast in putting out most effective statements to try to obtain whatever additional cash is available. It would be impossible to separate the types of capital expenditure—for example, those that fall under the new underspend phenomenon as opposed to the bulk of continuing programmes.

The right hon. Member for Ardwick is in difficulties. This is a complex issue. It is not easy to follow from the Opposition Benches. The right hon. Gentleman found himself for most of the time talking about the wrong year. The whole question of the GREA exemption for next year has been dealt with in the consultative process now under way. We have told the local authorities that we do not think that there should be a GREA exemption next year. The essence of the right hon. Gentleman's question related to the level of capital underspend with which we are trying to deal in the current year and that is already under way.

The right hon. Gentleman is fully aware, because we have already made it clear, that we have a GREA exemption for this year. He is entitled to say that some authorities would be caught. We know that. Those would be the high spending authorities. But where the right hon. Gentleman is again in difficulty—he will not have been briefed on this because it is not convenient for local authorities to reveal this sort of information—is that the underspend which local authorities have in their normal outturn from budget is also likely to work on their side in the present situation. All of that would be available as a cushion against the sort of expenditure problems that the right hon. Gentleman talked about.

We in the Department are privileged to have the endless conversations that are going on with local authorities. The right hon. Gentleman is repeating what he is told to say by the pressure groups outside. We know how the local authorities are responding to our initiatives. In many local authorities there will be significant items of expenditure now taking place as a result of the flexibility and encouragement of the Government.

Mr. Kaufman


Mr. Heseltine

No. I am sorry.

Mr. Kaufman

The right hon. Gentleman still has 10 minutes.

Mr. Heseltine

Just because the right hon. Gentleman's intervention lasted 10 minutes, it does not mean that I have to give way 10 times in responding to it.

I hope that the House will see that the Government have brought flexibility to the problems of the inner cities and, ingenuity in devising ways of bringing new resources from the private sector and have tried to bring a sense of realism into the management and value for money of local government. There is no escape for any of us from the pressures of the recession. As time unfolds, the initiatives which are beginning to come forward will be seen as a turning point in the relationships between central and local government and in the opportunities for the inner city areas. I believe that the record of this Government will be seen as a proud one.

Mr. Kaufman

Before the right hon. Gentleman sits down—

Mr. Deputy Speaker

Order. I think that the Secretary of State has sat down.

Debate adjourned.—[Mr. David Hunt.]

Debate to be resumed on Monday next.