4 March, 1926.]

[Continued.

much as the best offer we received, and he preferred, and I think perfectly rightly, to sell to a co-operative society rather than to a speculative building firm.

652. I suppose, really, the approximate loss is about £1,250,000 to £1,500,000?-Yes; but if you take the difference between the capital cost of the munitions of war and other things which the Disposal Board sold, and the amount they realised, I think you will find that these come out extremely favourably. It is really a war loss, and you have to face that, I am afraid.

654. Because the tenants would not be protected under the Rent Restriction Act? No, because the landlord naturally would say, "I want my property back." I do not think you could help that. Take this place near Sheffield, Tinsley; the owner of that property was Lord Fitzwilliam, and he naturally said, "I cannot allow my property to go on being used by the Government for the next 15 or 20 years without it being purchased, or terms being come to," and we had to come to terms with these various landlords; and they have met us very favourably and decently, I think.

655. What did we pay for the purchase for this short period? Which particular one are you referring to?

656. Take them as a whole: those that have been purchased on short tenancies? -I can let you have a list of what has been paid for all the properties we have had to purchase; I have not the figures with me at the moment.

657. I am referring more especially to the properties that have short-period tenancies, where we have to pull them down and give the properties over again? -That is the temporary housing estates

658. Yes? I will let you have a paper. 659. Have you any figure for any estate of a temporary housing character?-Not here with me at the moment.

660. Could you tell the Committee what it costs for the maintenance of these

houses? I cannot let you know now; I will let you have a statement of the whole cost of maintenance.

661. It would be interesting to know, first, what they cost originally; secondly, what they cost to maintain; and, thirdly, what it is anticipated it will cost to pull them down and hand them over again to the owners of the land? There is no doubt about it, the cost of maintenance will go up every year, and that is why our policy, at Barrow, for instance, where the houses are very poor and very bad, and rapidly becoming slum property (I have been to see them all) is that whenever a vacancy occurs, we do not re-let that house, we pull it down, so as to free the site as soon as possible.

662. How do you get rid of the tenants? -This has gone on automatically, either through death, or migration. If such a vacancy occurs, we do not let that house again.

663. So, whatever income you were receiving from that house would go on to the dead-weight charge of the Scheme?— Yes, less the cost of maintaining it.

664. On the general question of housing have you any permanent hous ing schemes still in hand?-We have only got two in England, a place called Queensferry, a small thing, and Chep

stow.

665. Are all the houses in occupation, on that Estate? Oh, yes; I do not think we have any voids anywhere, except, as I say, those voids where we do not re-let.

666. Are we creating a big debt on any of these estates by reason of the arrears of rent? Yes, I am sorry to say that is So. It is better than it was, but the net arrears at the end of September, 1924, were about £75,000 on all the estates; but of this amount approximately 2/5ths was on account of the Well Hall Estate, a legacy, mainly, of a rent strike, and a debt owing by the Chester-leStreet District Council, dating from the time of their administration of part of the Birtley Estate. This latter is in process of being gradually liquidated. During the course of the last year there has been a reduction (excluding the lastmentioned item) of the arrears, by about £3,000, mainly effected as a result of the unemployment relief works carried out during the winter of 1924-25, on which many of the tenants were employed.

667. When you submit your statement, would you mind saying how much was in arrear, as well as the rent? Yes, I can

4 March, 1926.]

let you know that; I know it is kept up to date.

of

668. Have we any large sums arrears on the permanent Estates, or do I understand we have not any. You referred to Barrow, just now?-Barrow, was, of course, one of the worst places, except perhaps Glasgow, for unemployment in the whole of the United Kingdom. At Well Hall, which was the one I mentioned just now, there are, of course, fairly heavy arrears, chiefly on account of this organised rent strike.

669. I understood you to say we have only one permanent Estate still in hand to dispose of?-Two in England and five in Scotland.

670. What the Committee would like to know, I think, is what is the figure for arrears per annum?-On that particular Estate? There are not many there; it is quite a small place.*

Mr. Baker.

671. Can we be told the cause of the rent strike at Well Hall? Yes, there was an organised revolt against the rents which the Office had fixed, after taking expert advice. This went on for many weeks, and finally we agreed to Arbitration, and the Arbitrator gave an Award in favour of the Office of Works, and even stiffened the rent of one or two corner houses; after that, the rent strike collapsed.

672. Is there any possibility at all of any of those arrears being recovered?— We have recovered something, but there is no possibility of getting back anything further now, because you see the estate has been sold, and the purchasers are looking after the rents as far as possible; but I do not think we shall ever get back the arrears. I think the Treasury have recognised that it will have to be wiped off.

Captain Craig.

673. In most of the places where you still hold these estates you say when a tenant leaves you do not take on a new tenant? I will not say that in all the estates; some are very much better than others; Sheffield, for instance, is very much better than Barrow. That is particularly at Barrow, where the Estate is extremely bad; it has to be built on a marsh on account of the proximity to Vickers' Works. It is in an unhealthy district and it has been condemned by the

* See Appendix 10.

[Continued.

Local Authority. It is tending rapidly to become a slum property which it is inadvisable for anyone to hold, particularly the Government. We have decided, inasmuch as there is no congestion of houses (because the population has gone to a great extent, and there are houses to let galore in that district) and the Barrow Corporation is entirely with us, that when these houses become vacant, by death or migration or voluntary giving up, we shall not attempt to relet those houses.

674. Barrow is one of the places, together with Coventry, Flookburgh and others, which have been sold, as a final transaction you said, to a Co-operative Society? That is the permanent estate; we have three estates at Barrow. The ones I am talking about, where we are demolishing, are the semi-permanent or temporary estates.

675. The permanent ones are good?— Yes, quite good.

676. They could be used for all purposes of housing: for people to live in?_ Certainly.

677. They were bought by the Co-operative Society? They were not bought by the Co-operative Society. When the offer of the firm, who were dealers in land, for Well Hall was declined, they came forward and made offers for the various estates about the country. We had in every instance previously asked the Local Authority whether they would consider taking these houses over, and they would not do it, because they said, "It means we shall get less grants for putting up new houses, and what we want is houses"; it would have diminished their power of getting more houses if they had had to spend their grants, which they got from the Ministry of Health, in purchasing ours which already existed.

Mr. Harmsworth.

678. I understood that the building of houses, which took place during the war and directly after the war, has long since finished? Oh yes, long since. We never put up any of these, with the exception of Well Hall. They were all put up by the War Departments, the Ministry of Munitions chiefly.

Chairman.

679. We will now go to the Account at page 100. Have you any comment at all on Item A. in reference to New Works,

Sir Malcolm?-(Sir Malcom Ramsay.) No, the items are all set out in detail on pages 101 to 103. The main item of expenditure under A. is shown on page 102, and that was for buying the sites of the temporary houses which, otherwise, would have been forfeited altogether, as Sir Lionel Earle has explained.

Mr. Gillett.

66

680. May I ask with regard to the last item on page 103: Construction of Roads." If these houses were built some time ago, how is it that this large sum of money appears here for construction of roads? (Sir Lionel Earle.) The roads were never built properly, they were merely cinder roads, and in wet and wintry weather the condition of those roads was quite deplorable. In fact persons who occupied a house on these estates (as 1 have seen over and over again) could not keep their house decently clean when they came in, on account of the filth on their own boots; and, when the Unemployment Schemes were insisted upon by the Government, we thought it was a good opportunity to employ some of these out of work tenants in making these roads, I will not say up to date roads, but good enough roads for the Local Authority to take them over in case the estates ever passed into their hands.

682 What exactly is the meaning of Item B. "Annuity £49,331 19s. Od.," on page 100P-(Mr. Buchanan.) This annuity was set up to repay the purchase money in connection with the Well Hall permanent estate, built under the Housing Act of 1914.

683. It is a sort of Sinking Fund?--Yes.

684. There is a matter on page 102 which has already been dealt with at some length, but I should like to know this: these estates are not being developed now

[Continued.

at all, are they?-(Sir Lionel Earle.) Not at all; we are merely maintaining them in the cheapest possible way until we can either pull them down or dispose of them.

685. As a matter of fact the figure of expenditure in item 2 on page 102 of £72,024 is merely a transfer from the Ministry of Munitions to your Department? No, that is the sum which we have had to pay to purchase these sites to make them Government property; otherwise, the whole of the property on those sites, including the houses and everything, would no longer be ours.

686. You had to send good money after what had already gone?

Captain Craig.

687. Has that policy paid?—I think it will.

Major Salmon.

"Works

688. When we have down here, in Progress," does that mean, works have been in progress between 1923 and this period. I am not upon the amount; it is the principle I should like to be sure about? You will see the item is: " for payment of final balances on building contracts."

689. That is what that has reference to? That is what that £31 17s. 10d. has reference to. (Sir Malcolm Ramsay.) In the Estimates works are classified in two categories; one is "Works in Progress," that is works which have been started in previous years and we are continuing; the other is "Proposed New Works," that is works which are to be begun in the year; those appear in the Estimates, and the same words must be reproduced in the Account.

Mr. Harmsworth.

690. Does the same thing apply to the item, " 'Acquisition of sites for permanent Schemes"; which seems to read as though it referred to permanent Schemes which are not yet formulated. I suppose they are permanent Schemes of the past.-(Sir Lionel Earle.) That is so. That is the value of the site of the Flookburgh Housing Estate. That was not very far from Barrow; it was an Air Ministry development during the war. The value of the site as fixed by the owner was £4,820, while the Department's Estimate was £2,750. Finally, we had to go to

4 March, 1926.]

[Continued.

Arbitration, and the Arbitrator's Award was £2,318 plus fees and expenses, making a total of £2,650, which was just £100 less than our Estimate.

Mr. Briggs.

691. This item, "Acquisition of sites," will not appear again?-No.

692. That is finished with now? Yes. I think every one has been bought.

Sir John Marriott.

693. There is a small item on page 100, D.D. " Compensation and Losses," what does that refer to?-At the top of page 101 you will find the explanation of that. It was, "An ex gratia payment made to the London, Midland and Scottish Railway, in settlement of a claim of £216 12s. 8d. for expenses incurred in clearing from their line debris washed on to it from the Tyler Street, Sheffield, estate on two occasions during abnormal rainfall." That was after a terrific flood which occurred: a waterspout.

Captain Craig.

694. Has the policy of the Government of buying up the sites of these estates to prevent the houses going to the owners proved a successful policy from the point of finance, or not. Would not it have been cheaper for the Government to have allowed these semi-permanent houses to go? I do not think so, because they have been getting a very considerable rent from these estates meanwhile, and I think ultimately we shall be able to sell the land, directly the place is cleared, for at least as much as we gave; and, secondly, there are people nibbling for the purchase of some of these estates, therefore, I think it would have been certainly a very wasteful policy to have simply handed over the whole of the value of these houses, which would represent a considerable sum of

money.

695. You cannot show from the Accounts that that policy has been a successful one?-I do not think anyone can show that till we have been able to dispose of them. Of course, we are not going to hold them any longer than we can help.

Chairman.

696. Paragraph 15 of Sir Malcolm Ramsay's report, on page viii, deals particularly with the residence for the Governor of Northern Ireland. I think, Sir Malcolm, one of the questions which arise on this paragraph is whether it was necessary to buy all this ground round about the place. That, I believe, is the real controversy on this transaction? (Sir Malcolm Ramsay.) As far as I understand it, the property consists of two parts, the small park with the house which will be the residence of the Governor, and the big park of 970 acres which will be transferred to the Government of Northern Ireland. The question which suggests itself is: "Was it necessary to buy the big park at all? " (Mr. Phillips.) Might I deal with that point now? There were two transactions before the Government, two alternative offers, one was the house and the small park for £16,500, the other was the whole estate for £25,000, the difference, therefore, being £8,500. We

702. You said, I understand, £16,500 or £25,000?-That is so, that is the purchase price.

703. Then what is this amount on page 113, £46,000?-(Sir Lionel Earle.) This is for the purchase and adaptations that had to be made. (Mr. Phillips.) The various reconditioning services. (Sir Lionel Earle.) We only spent, of course, £28,000 in that year.

704. I know, but you asked for £46,000. Is the total cost going to be £46,000?— (Mr. Phillips.) That is my information. (Sir Lionel Earle.) I think there has been a revised estimate. The only amount that was spent that year was £28,000.

705. What will be the total cost of this residence; that is what I want to know? -The cost of adaptation was provisionally estimated at £21,000, and the furniture at £6,100, the requisite provision being included in the Vote for 1924-25. As a result of further experience and closer investigation of requirements, the total estimate for adaptations has been revised to £24,565, and for furniture, to £8,850. It is a biggish

house (I have been to see it), but, of course, the attitude of the Northern Government was: "Why should we be put in a worse position than the Viceregal Lodge at Dublin?"

706. Do I understand the total cost to this country is £32,000?-Did I understand you to say £24,000 plus £8,000?— No, much more than that. I can let you know, because I think the work is practically completed now. I can let the Committee know what the whole thing has cost.

707. It sounds enormous for a country like Ireland. Could we know the total cost?

Chairman.

708. I intended to ask the witness what was the meaning of the phrase "Total (revised) Estimate £47,670 " on page 113, is that an inclusive figure? (Mr. Phillips). I think that is the last estimtte: £47,670, less the consideration which I have mentioned: that we escape an annual charge which was estimated at over £2,000 a year, which legally falls on

us.

709. Would it be correct to call this the total price of the purchase of this estate and all you have to do is to put it into order? That is my understanding of the figures. (Sir Lionel Earle). And the furrishing?

710. Everything? Yes. (Mr. Phillips). I suggest you must, in getting at the total cost to this country, at least knock off that £8,500 for which we get an ample set-off.

Sir Fredric Wise.

711. Did you try any other estate?— (Sir Lionel Earle). Oh, yes, many.

712. Houses are fairly cheap in Ireland? Well, I do not know; I did not find that so in the North. I think they are very cheap in the South. However, the other proposal, which was made in the first instance, was a much more expensive

one.

713. There was another proposal?-Oh, yes.

Major Salmon.

714. Am I correct in understanding that for the difference of £8,500, we save £2,000 a year. Is that the position so far as the account is concerned? (Mr. Phillips). That is so.

715. That is rather a good investment? -(Sir Lionel Earle). Very.

716. When we come to the second point, which is the estimate of what it would cost to renovate the house and furnish it, to what extent was the Department out in arriving at their estimate, having regard to what it is actually costing?_ think I told you just now that the original estimate was £21,000, and there was a revised estimate, when we came to closer grips with the thing, of £24,560.

717. There was also a further revision, if I understood you correctly, on the other work? Only on the furniture: £6,100 versus £8,800.

718. Therefore, we have to add £2,000 more on the furniture; so it has really