Where a contribution is paid to a local housing authority, the authority shall pay by way of annual grant to the owner of the house an amount not less than the contribution paid by the Secretary of State.

No such grant shall be made if before it is made the Secretary of State is satisfied that during the whole or the greater part of the period to which the payment of the grant is referable the house has not been available as a dwelling fit for habitation, unless he is satisfied that that could not with reasonable diligence have been achieved.

Any question as to the period to which a payment is referable shall be determined for the purpose of this paragraph by the Secretary of State.

Where the duty of a local housing authority to make a grant is wholly or partly discharged by virtue of this paragraph, the Secretary of State shall make such consequential reductions as he thinks fit in any sum payable by him to the authority.