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Catalogue Reference:CAB/128/51/21
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THIS D O C U M E N T IS T H E P R O P E R T Y
OF HER BRITANNIC MAJESTY*S
GOVERNMENT
COPY NO
C M ( ? 3 ) 20th
Conclusions
5
CABINET
C O N C L U S I O N S of a M e e t i n g of t h e
h e l d a t 10 D o w n i n g S t r e e t
MONDAY 2 APRIL
at 5 . 00
on
1973
pm
P R E S E N
T
The Rt Hon Edward Heath
Prime
Cabinet
Minister
MP T h e R t H o n L o r d H a i l s h a m of S t M a r y l e b o n e
The Rt Hon Anthony Barber
Lord Chancellor
C h a n c e l l o r of the
The Rt Hon Lord
Exchequer
The Rt Hon Robert Carr
Carrington
S e c r e t a r y of S t a t e f o r
MP
S e c r e t a r y of State for the
Defence
MP
Home
Department
The R t Hon J a m e s P r i o r
L o r d P r e s i d e n t of the
MP
Council
The Rt Hon Geoffrey Rippon QC
S e c r e t a r y of S t a t e f o r t h e
MP
Environment
The Rt Hon Sir Keith Joseph
MP
S e c r e t a r y of State for S o c i a l
Services
The Rt Hon Margaret Thatcher
MP
S e c r e t a r y of State for E d u c a t i o n
and
Science
The Rt Hon Gordon Campbell
S e c r e t a r y of State for
The R t Hon The E a r l
Lord Privy Seal
MP
Scotland
JeUicoe
MP
The R t Hon P e t e r T h o m a s QC
S e c r e t a r y of State for
The Rt Hon Maurice Macmillan
S e c r e t a r y of State for
The Rt Hon Peter Walker
S e c r e t a r y of State for T r a d e and Industry
MP
Employment
Wales
The Rt Hon Joseph Godber
M i n i s t e r of A g r i c u l t u r e ,
and
MP
MP
Fisheries
Food
The Rt Hon Sir Goeffrey Howe QC
MP
M i n i s t e r for T r a d e and C o n s u m e r
Affairs
1
THE FOLLOWING WERE ALSO
PRESENT
Mr Paul Channon M P
Mr Patrick Jenkin
M i n i s t e r for Housing and C o n s t i u c t i o n
Chief Secretary,
The Rt Hon Francis P y m
Parliamentary Secretary,
SECRETARIAT
Mr J J B
Mr P
Hunt
Benner
Mr R L
Baxter
S U B J E C T
HOUSING - p o t a e Y
4
11
MP
Treasury
MP
Treasury
T h e C a b i n e t c o n s i d e r e d a m e m o r a n d u m b y t h e S e c r e t a r y of S t a t e
for
t h e H o m e D e p a r t m e n t ( C P ( 7 3 ) 4 6 ) r e p o r t i n g t h e c o n c l u s i o n s of t h e
M i n i s t e r i a l group on land and h o u s e p r i c e s ( G E N 148).
They
also
had before t h e m a m e m o r a n d u m by the S e c r e t a r y of State for
E n v i r o n m e n t (CP(73) 45) on the financial i m p l i c a t i o n s
propo sal s
the
of t h e
0
THE HOME SECRETARY
s a i d t h a t i n p a r a g r a p h 2 3 of t h e
P a p e r o n t h e s e c o n d s t a g e of t h e p r o g r a m m e f o r
White
controlling
inflation (Cmnd 5205) the Government had undertaken to
bring
f o r w a r d p r o p o s a l s t o i n c r e a s e t h e a v a i l a b i l i t y of b u i l d i n g
and r e d u c e the extent to which d i s p r o p o r t i o n a t e l y high
could be m a d e f r o m t r a n s a c t i o n s in land.
land
profits
The Ministerial
group
which had b e e n set up under h i s c h a i r m a n s h i p to c o n s i d e r the
matter
h a d h o w e v e r £ound it i n e v i t a b l e that t h e y s h o u l d r e v i e w the w h o l e
of
p o l i c y in t h e field of l a n d and h o u s i n g .
fell
under six headings
i.
Their recommendations
­
S t a b i l i s a t i o n of m o r t g a g e f u n d s .
d i s c u s s e d b y the Cabinet at t h e i r n e x t
ii.
Supply of building land.
four main proposals:
first,
This was to be
meeting.
The group had
produced
new guidelines for
development
control should establish a general presumption in favour
housing development,
unless there were
objections;
land should be m a d e available
secondly,
serious
for
housing in c e r t a i n l i m i t e d p a r t s of G r e e n B e l t a r e a s
t h e r e w o u l d b e n o l o s s of a m e n i t y ;
thirdly,
s c h e m e s b e t w e e n local authorities and private
fourthly,
developers
iii.
where
there should
l e g i s l a t i o n to m a k e p o s s i b l e t h e i n c r e a s e d u s e of
providing essential
of
planning
be
partnership
enterprise;
should p a y a s h a r e of the c o s t
of
services.
Land hoarding charge.
The intention to
introduce
a land hoarding c h a r g e had a l r e a d y been announced by the
C h a n c e l l o r of t h e E x c h e q u e r ,
A point for d e c i s i o n
whether the charge should be deductible for tax
was
purposes.
T h e m a j o r i t y v i e w in the group w a s that it should not.
iv.
Voluntary housing movement.
The
Housing
Corporation and the National Building A g e n c y
be r e o r g a n i s e d and strengthened.
a r e a of a d d i t i o n a l
v.
should
This was the
Local authorities.
The Government
should
to encourage local authorities to build for rent
necessary,
continue
where
to c a r r y on with s l u m c l e a r a n c e and to
council houses;
houses
main
expenditure,
sell
and should a l s o e n c o u r a g e t h e m to build
specifically for
sale.
vi
Improvements.
0
After mid-1974
a r r a n g e m e n t s for i m p r o v e m e n t
when the
s
grants,
existing
which had
largely
b e e n d e s i g n e d to c r e a t e e m p l o y m e n t in d e v e l o p m e n t
would c o m e to an end,
there
should be a r e v i s e d
d e s i g n e d to concentrate r e s o u r c e s in h o u s i n g
policy
stress
The S e c r e t a r y of State for the E n v i r o n m e n t would find the
a d d i t i o n a l c o s t of t h e p r o p o s a l s f r o m w i t h i n h i s
existing allocations,
areas,,
areas.
net
Departments
l a r g e l y b y r e d u c t i o n s in e x p e n d i t u r e o n trunk
r o a d s and m i s c e l l a n e o u s local
services;
and c o r r e s p o n d i n g
savings
would be found by the S e c r e t a r i e s of State for Scotland and for
In t h e t i m e a v a i l a b l e ,
p r o p o s a l s in full detail;
but h e w a s confident that t h e y c o u l d
p r e s e n t e d in a White P a p e r in a f o r m which,
general,
although
confidence
industry.
THE CHANCELLOR
OF THE E X C H E Q U E R
to object to the p r o p o s a l s on m e r i t s .
said that h e did not
and h e w a s obliged,
therefore,
public
m u s t be financed by specific
savings in
should not be p r o c e e d e d with.
if
expenditure.
T o the extent that the s a v i n g s e n v i s a g e d did not
the p r o p o s a l s
and
materialise,
Furthermore this
shift
of p r i o r i t i e s w i t h i n the p r o g r a m m e s f o r w h i c h t h e S e c r e t a r y of
for the Environment was responsible n e c e s s a r i l y reduced h i s
to contribute to the general
savings on public expenditure,,
thus place a greater obligation on other
spending
arising
to
It w o u l d
politically difficult to cut t h e s e p r o g r a m m e s ,
in c o n s e q u e n c e to look e l s e w h e r e for the
and
roads,
roads,
necessary
savings.
find
savings in different fields than those proposed for
T h e p r o p o s e d c u t s i n t h e e x p e n d i t u r e of
D e p a r t m e n t of t h e E n v i r o n m e n t ,
England,
the
particularly that on
w o u l d p r e - e m p t o n e of the m a i n
possibilities
f o r r e c o n s t i t u t i o n of t h e c o n t i n g e n c y r e s e r v e a n d
t h e C h a n c e l l o r of t h e E x c h e q u e r h a d i n d i c a t e d ,
be
be
S i m i l a r l y in W a l e s it m i g h t a l s o be n e c e s s a r y to
b.
support
that there would
i n c r e a s e d expenditure on the i m p r o v e m e n t of trunk
generally.
would
financial
out of t h e a s s u r a n c e that the G o v e r n m e n t h a d g i v e n ,
p o r t s and the infrastructure
ability
and
T h e r e w a s a p a r t i c u l a r difficulty in Scotland
the'developmelit"Tirf'"North S e a g a s and oil,
State
Ministers.
T he following points w e r e m a d e in d i s c u s s i o n of the
i m p l i c a t i o n s of t h e p r o p o s a l s ­
a.
not
expenditure,
to stipulate that the p r o p o s a l s ,
This m u s t apply also to the p r o p o s e d expenditure in Scotland
Wales.
wish
On the o t h e r h a n d h e c o u l d
a g r e e to any further significant net
accepted,
be
somewhat
w o u l d a p p e a l to public opinion and h e l p to c r e a t e
in the building
Wales.
it h a d not b e e n p o s s i b l e to w o r k out t h e
?
as
would
m a k e it m o r e likely that c u t s would have to fall on
other
programmes.
S o m e of t h e s e w e r e h i g h l y s e n s i t i v e ,
w a s arguable that the G o v e r n m e n t
should not r e s t r i c t
f r e e d o m of m a n o e u v r e in t h i s w a y without f u l l e r
of what would be
c.
and it
its
knowledge
involved.
T h e m a j o r i t e m of e x p e n d i t u r e ,
apart from
proposals for mortgage finance which were to be
the following day,
the
considered
a r o s e o u t of t h e p r o p o s a l f o r e x p a n d i n g
r o l e of t h e v o l u n t a r y h o u s i n g m o v e m e n t .
Comparatively
little of that e x p e n d i t u r e would fall in 1 9 7 3 - 7 4 and
1974-75
and the q u e s t i o n a r o s e w h e t h e r it w a s n e c e s s a r y at this
for the G o v e r n m e n t to c o m m i t t h e m s e l v e s to the
expenditure proposed for the subsequent
years.
b e v e r y s e v e r e l y c r i t i c i s e d if t h e y a l l o w e d t h e l e v e l of
would
house
T h e p r o p o s a l s in the paper
e x p r e s s e d in too g e n e r a l t e r m s to m a k e much impact,
of t h e m w e r e c a l c u l a t e d to s e c u r e
were
and
short-term results.
few
In the
s h o r t r u n it s e e m e d l i k e l y that l a n d p r i c e s w o u l d c o n t i n u e to
s p e c u l a t o r s would continue to m a k e high p r o f i t s ;
would bear the b l a m e .
and the
It w a s s u g g e s t e d t h a t t o o m a n y
b e d r o o m e d h o u s e s w e r e o c c u p i e d by elderly coup.les,
be provided with m o r e
suitable accommodation,
three­
accommodation,
of the r i g h t s i z e and p r i c e w e r e a v a i l a b l e .
larger
Attention
substantial hardships borne by
but who w o u l d b e glad to buy if
should
so that the
m a r r i e d c o u p l e s who w e r e f o r c e d into e x p e n s i v e
rise;
Government
who
houses could be used by these who most needed them.
ought a l s o to b e g i v e n to the
stage
heavy
In f u r t h e r d i s c u s s i o n it w a s a r g u e d t h a t t h e G o v e r n m e n t
building to fall substantially.
the
young
furnished
accommodation
More ought to be
done
to e n c o u r a g e t h e c o n v e r s i o n of l a r g e p r o p e r t i e s for t h e u s e of t w o
or more families,
s i n c e t h i s w a s o n e of the f e w c o u r s e s of
that could yield quick r e s u l t s .
was concerned,
So far a s the land hoarding
charge
if it w a s b a s e d o n t h e v a l u e of t h e l a n d w h e n t h e
planning p e r m i s s i o n w a s granted,
a subsequent steep rise in the
value could m a k e the charge ineffective
as a deterrent^
and
t h a t p o i n t of v i e w t h e r e m i g h t b e m e r i t in b a s i n g it o n a
valuation.
accion
from
current
F i n a l l y it m i g h t be d e s i r a b l e to s a y s o m e t h i n g in the
White P a p e r about the p r o b l e m of e m p t y office
accommodation,
which w a s linked in the public mind with the housing
shortage.
On the o t h e r h a n d it w a s a r g u e d that h o u s i n g w a s a f i e l d i n
it w a s not p o s s i b l e to s e c u r e d r a m a t i c
c u r r e n t r a t e of p r i v a t e building s t a r t s w a s the h i g h e s t
since the war,
which
short-term results.
The
achieved
and ( l e a v i n g a s i d e t h e q u e s t i o n of m o r t g a g e
finance)
it would not b e u n d u l y difficult to e n s u r e that t h e y did not fall
back.
The steps n o w p r o p o s e d w e r e all in the right direction and m o s t
them could be taken without legislation.
to set t h e m in m o t i o n a s q u i c k l y a s
It w a s u r g e n t l y
possible.
of
necessary
THE PRIME MINISTER,
s u m m i n g up the d i s c u s s i o n ,
said that
w a s n o doubt about t h e p o l i t i c a l i m p o r t a n c e of h o u s i n g
there
and t h e
need
t o m a i n t a i n the i m p e t u s of t h e h o u s e b u i l d i n g p r o g r a m m e .
The
p r o p o s a l s for m o r t g a g e finance would be considered at the
meeting
the following day and a draft White P a p e r should be circulated to
the r e m a i n i n g p r o p o s a l s in m o r e detail.
The Cabinet were
show
broadly
in a g r e e m e n t with the p r o p o s a l s for i n c r e a s i n g the supply of land,
a l t h o u g h it w o u l d b e i m p o r t a n t to s h o w t h a t t h e u s e of G r e e n
Belt
land would have little effect on a m e n i t y and a l s o that l a r g e r
areas
w e r e being added to the G r e e n B e l t s ,
It w o u l d a l s o b e
necepsary
t o c o n s i d e r f u r t h e r t h e b a s i s of t h e l a n d h o a r d i n g c h a r g e .
the p r o p o s a l s for housing,
As
regards
the a l t e r n a t i v e s w e r e to maintain the
level
of s t a r t s in the p r i v a t e s e c t o r at r o u g h l y i t s p r e s e n t high l e v e l o r to
t a k e s t e p s to i n c r e a s e it e v e n f u r t h e r b y e x p a n d i n g t h e r o l e of t h e
voluntary housing movement.
It w o u l d b e w o r t h c o n s i d e r i n g
further
w h e t h e r the second c o u r s e could be taken without c o m m i t t i n g
G o v e r n m e n t at this s t a g e to the h i g h l e v e l s of e x p e n d i t u r e
for the y e a r s 1975-78.
It m i g h t a l s o b e u s e f u l t o c o n s i d e r
f r o m the e x p e n d i t u r e point of v i e w ,
the stabilisation of
finance and the expansion of the housing p r o g r a m m e
regarded as alternatives;
greater priority.
programme
and,
if t h e y c o u l d ,
whether,
mortgage
could be
which merited
If i t w e r e d e c i d e d t h a t t h e
should b e expanded,
the
envisaged
the
housebuilding
it w o u l d b e n e c e s s a r y to t a k e
a c c o u n t of t h e l i m i t e d c a p a c i t y of t h e c o n s t r u c t i o n i n d u s t r y ;
this m i g h t call for compenrating reductions,
and
on a selective
basis,
of o t h e r t y p e s of n e w b u i l d i n g r e q u i r i n g b r o a d l y s i m i l a r s k i l l s
resources.
T h i s w a s s o m e t h i n g w h i c h s h o u l d if n e c e s s a r y
be
c o n s i d e r e d b y the S e c r e t a r i e s of S t a t e f o r t h e E n v i r o n m e n t
for Employment,
These,
however,
c o m i n g d i s c u s s i o n about m o r t g a g e
The Cabinet
L,
would
forth­
finance.
-
Took note,
with approval^
of their d i s c u s s i o n by the P r i m e
2.
and
w e r e m a t t e r s to w h i c h it
b e n e c e s s a r y for the Cabinet to r e t u r n i n the light of t h e i r
and
of the s u m m i n g
up
Minister.
Invited the S e c r e t a r y of State for the
Environment
t o c i r c u l a t e a r e v i s e d draft of t h e White P a p e r on the
following
3,
day,
Invited the S e c r e t a r y of State f o r the
In consultation with the Chief S e c r e t a r y ,
c o n s i d e r the b a s i s of the land hoarding
Cabinet
3 April
Office
1973
Environment,
Treasury,
charge.
to