My Lords, I am grateful for the unity of views across your Lordships’ House. I am very disappointed by the Minister’s response although I am aware that agreeing to this amendment is not actually within his gift today because it is a matter for the Treasury and, specifically, for the Chancellor. I hope, however, that the strength of feeling demonstrated today will be taken seriously by them.
The Minister talked about the importance of reducing the national deficit, and we can agree with that. The point is that housing revenue account borrowing, because it has been ring-fenced since April 2012, need not count as part of the national deficit. I find it strange that the Government can promote sales of owner-occupied housing, where the average debt is £111,000, but with local authority housing, which has an average debt of only £17,000, they deem borrowing against the asset of those houses to be a challenge to the national deficit. There does not seem to be any logic in the Government’s position. I make no apologies for saying so, because housing revenue accounts are now ring-fenced and should not count as public sector debt. If the Government have a concern about the borrowing plans of any local authority, they have the power now, under the Local Government Act 2003, to cap that authority. However, they should not cap an authority which can use the prudential borrowing powers effectively.
I am finding it very hard to understand what the disadvantage is of this amendment, but I am at least grateful to the Minister for having clearly spelt out the Government’s position. I know that discussions are going to continue on this matter outside your Lordships’ House, and I shall continue to press the case—I hope with the support of all sides of your Lordships’ House—for relaxing the housing borrowing cap for local authorities. In the mean time, I beg leave to withdraw the amendment.