A secret council report, seen by the Independent, shows that Sir John, MP for Westminster North, was requested to lobby ministers on the council's behalf. Subsequently, millions of pounds worth of grants were given to Westminster, some of which were used to clear council houses for private sale instead of housing the homeless.
The 'Cash Incentive Scheme' grants, introduced in April 1989, were intended to be given to council tenants who were prepared to leave properties to buy a place of their own. Under the 1988 Housing Act, the freed flats and houses should then have been used to house homeless families.
However, Westminster City Council has admitted that some were sold privately, apparently in the hope that the aspiring families who bought them would vote Conservative. A report by Graham England, the council's housing director, to a meeting of the Chairmen's Group on 13 June 1989 says: 'Negotiations are still in progress with the Department of the Environment for (a) new statutory scheme in (an) attempt to preserve (the) Assisted Purchase Scheme on designated estates.'
The council's Assisted Purchase Scheme was run from 1987 to 1990 in much the same way as the later Cash Incentive Scheme but its legality was questioned last week by John Magill, the district auditor. He said it cost ratepayers pounds 2.6m.
Labour councillors argue that the Cash Incentive Scheme, under which residents could be given up to pounds 13,000 towards a new home, should not have been used on the designated estates referred to by Mr England because these were houses earmarked for sale.
Mr England's report went on: 'Chairman has approved a submission to the DoE. Brief going to John Wheeler to lobby ministers.'
Subsequently, Westminster City Council received pounds 1.4m government grants relating to 75 properties in 1990/91; pounds 2.5m for 125 properties in 1991/92; and pounds 0.61m for 81 properties in 1992/93. Housing officials say some of the freed properties were sold but they have been unable to say how many.
Sir John's office said he would not discuss the matter yesterday. If, however, he did agree to lobby for Westminster, it would not have been the first time. Documents leaked to the Labour Party in December 1989 show that he forcefully lobbied Margaret Thatcher and Nicholas Ridley, then the Secretary of State for the Environment, over the effects on Westminster City Council of the poll tax.
He allegedly gave briefings to Mrs Thatcher suggesting that the pounds 420 a head likely to be charged would cause 'electoral disaster' for the Tories. The assertion was made on behalf of GJW, a firm of lobbyists hired by the council.
In the following months, the Government found millions of pounds of extra grants for Westminster, allowing it to introduce a poll tax of just pounds 195 and to hold the council when a swing to Labour seemed likely.
With a majority of only 3,733, Sir John has also benefitted from Westminster City Council's policy of trying to engineer a Tory population. On 6 September 1986, a paper, 'Westminster's Housing: 1986- 1990', was launched at a local Conservative Party seminar.
Its objectives were: 'To ensure that, as far as possible, Westminster's housing policies achieve the type of social and economic residential mix that will enable us to retain control of the Council in 1990 and help to retain the Conservative majority in the Parliamentary seat of North Westminster (Sir John's).'
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