AMENDMENT OF SECTION 42 OF 1980 ACT (Hansard, 21 December 1983)

§ Mr. Heffer
I beg to move, That the clause be read a Second time.
This new clause would amend section 42 of the Housing Act 1980, in that it argues that the consultation of tenants should also take place on rents and services. The Government called section 42, and the Housing Act as a whole, a sort of tenants' charter, and we believe that the right to consultation in the Act is probably the weakest right in it. We are not particularly enamoured of some the other rights, either, but this is particularly weak, because 504 if one reads the section one sees that the landlord—that is the local authority — will consult the tenants only when it is, in the opinion of the landlord, a matter that will substantially affect them, and when it is appropriate for consultation.
We are of the opinion that rents and services are probably as appropriate, if not more appropriate, as any other aspect of housing management, because they are a matter of housing management. Section 42(2) says: A matter is one of housing management for the purposes of this Chapter if, in the opinion of the landlord authority concerned, it—

(a) relates to the management, maintenance, improvement or demolition of dwelling-houses let by the authority under secure tenancies, or to the provision of services or amenities in connection with such dwelling-houses; and

(b) represents a new programme of maintenance, improvement or demolition or a change in the practice or policy of the authority; and

(c) is likely substantially to affect its secure tenants as a whole or a group of them.

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We are not saying that these are not important matters, because they are. Subsection (3) says: A matter is not one of housing management for the purposes of this Chapter in so far as it relates to the rent payable under any secure tenancy or to any charge for services or facilities provided by the landlord authority concerned.
There cannot be anything more important than the rent that somebody pays or the services that they receive. Surely they are very much part of the housing management. Therefore, we would like to correct the Act by putting in this new clause.
The point is that tenants are consumers and as such they have as much right to consumer protection as any consumer in the private sector. If a private tenant is dissatisfied with the rent that he pays, he is able to apply, as we are aware, to the rent officer and to make representations about the standards and levels of service. The council tenants have their rents set by the local authorities and increasingly by Government, as Governments have much say on rents. Since this Government took office, council house rents have risen dramatically. The average gross rent rose by 120 per cent. between 1979 and 1983, while inflation, as measured by the RPI, rose by 57.8 per cent. Although rents have risen substantially, the levels and standards of services 1hat council tenants received in exchange — particularly repair services, which we have discussed — have declined significantly.
Council tenants should be given the right to be consulted about the rent that they pay in exchange for services and about the kinds of services that they receive in exchange for this payment. Rent and service charges should be considered as matters of housing management because of the rapid rise in council house rents since the Government took office, arid because many housing authorities now have housing revenue accounts in surplus. What is happening is that some local authorities are making profits, and these profits are going over, as we are aware, to the general rate revenue. That surplus revenue should not be used in this way. The tenants have some right to say where these profits should go and what services should be provided because they are the ones who are paying the rents.
It is ironic that many of those authorities that are making such transfers most need to plough back surpluses 505 into improved management and maintenance of their housing stock. A recent survey by Shelter revealed that many authorities that are subsidising the ratepayer out of their housing revenue accounts are placing substantial repairing obligation, on their tenants with the justification that the council cannot afford to take on these items of repair in view of the limited funds in housing revenue accounts.
The London borough of Havering, for example, places repair obligations on its tenants and encourages tenants to carry out repairs that are the landlord's responsibility under its do-it-yourself repair scheme, the basis of which is the Government's right to repair. Last year the borough transferred £1.4 million net from its housing revenue account to its general rate fund, yet 9,300 council dwellings in Havering — 51 per cent. of the council stock—needed repairs costing £3,750 or more each.
The transfer of housing revenue took place without any consultation with the tenants. The surplus transferred to the rate fund was used for environmental improvements of an unspecified nature. Other housing authorities have been far more explicit and I am sure that Conservative Members will be interested to know which they are. Torbay, Bournemouth and Eastbourne councils, for example, have all recently transferred housing revenue to their rate funds specifically to enable them to complete their new civic conference centres. These authorities charge their council tenants higher than average rents. The transfers of revenue were made without consultation with the tenants.
The new clause is important and we hope that the Government will be prepared to accept it. It will strengthen the so-called tenants' charter, which the Government say they introduced in the 1980 Act, and we ask the House to accept the new clause.

§ Mr. Simon Hughes
In effect, we are talking about the right of tenants to have a say. That falls short of what we should be discussing but I make no complaint that the new clause that I tabled was not selected for debate. Tenants would often like to have a direct say in the management, refurbishment and rebuilding that has an effect on their estates or on local authority dwellings in the borough as a whole. The new clause falls short of that but we shall be moving a small step in the right direction if it is accepted.
I hope that the Government will accept that the revenue that a local authority wishes to raise and the rents and rates that it proposes to charge are matters that concern tenants. As the acceptance of the new clause would require an objective assessment, we would see it as an improvement on the present position. At present there is no possibility of testing a local authority's claim that its proposal will not have an effect on the management of an estate. The tenant, effectively, has no means of enforcing his rights. By the removal of the words
"in the opinion of the authority concerned"
we would at least give the tenant the same status as the local authority in being able to establish, if the authority was not co-operative, the right to be consulted, even if not a right to further entitlements, which the Bill has not provided. I hope that the Minister will accept that an objective judgment would be better than the subjective judgment of many rather defensive local authorities.

§ Sir George Young
The hon. Member for Southwark and Bermondsey (Mr. Hughes) implied that at present 506 tenants need not be consulted on the refurbishment of their estates. In fact, they have to be consulted under section 42 of the 1980 Act. That section states that if, in the opinion of a local authority, a matter concerns housing management and is related to the management, maintenance, improvement or demolition of dwelling houses and represents a new programme of maintenance, improvement or demolition, the tenants have to be consulted.
The hon. Member for Liverpool, Walton (Mr. Heffer) exhumed some amendments that we considered during the passage of what was the 1980 Bill, and in part when the present Bill was in Committee. I was interested to hear whether any new arguments had been found for accepting the new clause in the intervening period, and especially whether any examples had been found of local authorities failing to consult. The hon. Gentleman produced no such examples. Before he talks about Eastbourne he would do well to ascertain whether there are Labour-controlled authorities that are transferring funds from the housing revenue account to the general rate fund. I think that he will find that one or two Labour authorities are doing that.
I turn to the first limb of the new clause. A housing matter, as defined by section 42(2) of the 1980 Act, is such if, in the opinion of the landlord, three conditions are satisfied. The conditions are set out in the Act, which also specifies certain matters that do not concern housing management. The Act also goes on to specify certain matters that are not housing management.
It is important to keep in mind that section 42 is tied to section 43, which deals with consultation with secure tenants. The thrust of section 43 is that tenants who are likely to be substantially affected by a matter of housing management are consulted before new programmes or changes are introduced. In these circumstances, no one can be better placed than the landlord to judge whether a matter meets the conditions required by section 42. It would, therefore, be wrong to imply that another body should be called upon for an informed opinion.
There is little evidence to suggest that individual landlords' definitions of housing management are causing difficulty or that their interpretations are in contravention of the spirit of section 42. I have no reason to believe that authorities do not act reasonably and responsibly. There seems no doubt that removal of the qualifying phrase as is suggested in the new clause would give unnecessary scope for the frustration of rational proposals by frivolous quibbles. In any case, as matters now stand, tenants can challenge in the courts decisions by their landlords on the ground that their opinions are such that no reasonable landlord could have reached them.
I am not convinced that the operation of sections 42 and 43 of the 1980 Act would be improved by the omission of reference to the landlords' opinion. The new clause could add appreciably to the work of the courts, with attendant delays in implementing proposals. No new evidence has been brought to the House to justify the case for the new clause.
I turn now to the second limb of new clause 10, which requires landlords to consult secure tenants about rents and charges for services or facilities they provide. We considered this matter very carefully when we received many representations following our consultation paper, and during the passage of the Housing Bill in 1980.
I must first say that the subsection is defective as it does not specify whether (d) is additional to (a) to (c) of section 507 42(2) or an alternative. If the latter is the intention. I am sure local authorities would regard the extra burden of consulting tenants on any change to an individual rent or a charge quite catastrophic.
In addition, the new subsection would sit most unhappily alongside section 40(7), which provides that a variation in rent or payments for services and facilities is not a variation in the terms of a secure tenancy on which the landlord has to serve a preliminary notice in addition to the notice of increase on the tenant.
But, in any case, I am quite certain that local authorities would be as overwhelmingly against any requirement to consult over rent levels as they were when the proposal was first tabled in 1980. That reaction was spread across all parties. The level of rents is inevitably closely bound up with a local authority's budget as a whole. It is of concern to all ratepayers, not just secure tenants, and local people's views should properly be considered in that wider context. However, the new clause goes further. It deals not only with general rent levels but with changes up or down to rents and charges on an individual basis. Such a duty would be extremely onerous. It would delay getting new rents fixed, add to administrative costs and achieve little or nothing, because the rents would still have to go up and the outcome would be nothing more than frustration and delay for all concerned. Similar considerations apply to consultations about charges for services and facilities.
To force landlords to consult tenants about rents and services might discredit the whole concept of consultation. That would be a pity, because there is much to be gained from this process, when both sides can work together for their mutual benefit and tenants can have a real influence on what is eventually decided.
In our view, therefore, the new clause is unnecessary and unwarranted, and I do not think that the case for it has been made. I ask the House to reject it.