DISPOSAL OF LAND BY HOUSING ACTION TRUSTS (Hansard, 27 June 1988)

§ The Secretary of State for the Environment (Mr. Nicholas Ridley)
I beg to move amendment No. 345, in page 52, line 28, after 'to', insert 'subsection (1A) below and'.

§ Mr. Deputy Speaker (Mr. Harold Walker)
With this it will be convenient to discuss Government amendments Nos. 346, 347, 334 to 341 and amendment No. 90, in clause 77, page 54, line 48, at end insert— `(6) In any case where the provisions of this section apply, a disposal may only be made to a person or body approved by the Housing Corporation under section 87 of this Act. (7) Any secure tenant in receipt of a notice under subsection (2) above shall have the right, on request, to become a secure tenant of the local authority from which the accommodation of which he is the tenant was transferred under section 69 of this Act and any such notice shall inform him of the said right. (8) Where a secure tenant exercises the right conferred by this section the Secretary of State shall adjust the amount of expenditure prescribed under Part VIII of the Local Government, Planning and Land Act 1980 (Capital Expenditure of Local Authorities etc) for the local authority to which it applies by an amount equal to the price for which the accommodation to which this section relates is transferred to the local authority.'

§ Mr. Ridley
This important group of amendments has been tabled to meet commitments given in Committee that tenants be reassured about their future once HATs have completed their work. It is a matter of real choice for tenants. When improvements have been made, I hope that many tenants will want to buy their homes. However, others will wish to stay in the social rented sector and they need to he reassured about what that will mean for them. The amendments provide just that assurance.
First, housing action trusts can transfer secure tenants and their properties only to landlords approved by the Housing Corporation. Those might include housing associations, tenants' co-operatives or other landlords, if approved. In all cases, the basis of approval will be the same as for our tenants' choice proposals. The Housing Corporation's criteria will be concerned with prospective landlords' stability, viability, competence and long-term commitment to provide decent rented houses for those who need it at a price they can afford. Those criteria, together with the undertakings that approved landlords will be required to give, will provide real guarantees for HAT tenants, and my power of consent over all proposed HAT disposals will help to make that stick.
Secondly, some tenants might prefer to return to the care of the local authority. The Bill will now require HATs to consult local authorities about their willingness to take on such tenants. If they are happy to do so, that option will be put fairly and squarely to the tenants. Thirdly, because we recognise the importance of ensuring that all HAT tenants have adequate information about the disposal options available, and enough time to digest those options, we are strengthening the Bill to improve the precedures governing tenant consultation. Taken together, the amendments offer tenants the prospect of improved homes, a choice of landlord and guarantees about their future.
While accepting the basic elements, the Opposition amendment seeks to go two steps further by, first, giving HAT tenants an absolute right of return to the local authority. That was debated at length in Committee. I cannot accept that it is reasonable to compel a local authority, many years ahead of a potential HAT disposal, to take back any tenant who so asks. The authority may no longer be in the rented housing business or it may have a different perception of its priorities. Comparisons made by the Opposition with tenants' right to buy or right to choose a new landlord are misconceived. It is one thing to 42 give tenants a right to leave an authority; it is quite another to enable them to return whether or not that authority wishes it. However, if local authorities want to commit themselves in advance, that is a choice that they can make.
The second proposal, also discussed in Committee, is that an authority's prescribed expenditure should be automatically adjusted to reflect the cost of acquiring stock from a HAT. It will already have received the benefit of a capital receipt at the time of the original transfer, which will add to its spending power over time. There is, therefore, no case for a further adjustment to prescribed expenditure at the later stage. I regret that I cannot advise the House to accept the Opposition amendment.

§ Mr. Simon Hughes
I welcome the fact that the Government have moved some way towards meeting the objections made in Committee, although I regret that they have not gone the whole way. There is a certain inconsistency in the argument that tenants can choose when, in reality, they will not have that right. Initially, a decision on the new landlord will he made without the consent either of the tenants or of the local authority. At the end of the life of a HAT—the Secretary of State has confirmed this—even if the tenants explicitly show that they want to return to being local authority tenants, that may not be possible. That is regrettable and inconsistent with the supposed philosophy of the Bill. Of course, the ultimate philosophy is not a right to choose; it is to de-municipalise housing. Therefore, it is consistent with that to make it difficult, if not impossible, for tenants to return to the local authority.
Although it is agreed that there should be more guarantees that tenants will have secure accommodation after the life of a HAT, and having provided that the landlords will be approved, it is regrettable that the Secretary of State has not gone the further mile and accepted that tenants who wish to return to local authorities should be allowed to do so. If that was a mutual agreement—if local authorities were willing to have tenants back and the tenants wished to go back—the principle of tenants' choice should require that the Opposition amendment be accepted.

§ Mr. Morgan
The chilling words uttered by the Secretary of State—that the local authority may no longer be in the municipal housing sector by the time the FIAT winds up—go to the heart of the problems involved in this group of amendments in terms of what the Government really intend should be the future of the municipal housing sector. According to the Minister of State, when he introduced the Bill, the great purpose was to diversify the municipal sector, but it is clear that the Secretary of State intends to strangle it and the Secretary of State for Wales, according to press leaks, intends to give it away. Council houses in Wales are now known as "two-up and £1 down".
The Government must sort out the confusion — preferably, for the purposes of constitutional propriety, through orthodox legislation rather than by a mixture of press leaks and last-minute amendments. The Department of the Environment seems to have stopped at 183 amendments. I think that the Secretary of State for Wales was under the impression that if his right hon. Friend the Secretary of State for the Environment reached 200, the Secretary of State for Wales could take the new ball and 43 table a new set of amendments, causing local authorities to give away municipal houses on a £1 deposit and allowing tenants to pay the rest out of housing benefit if they could not afford the normal obligations of ownership such as insurance, repairs, and so on.
At some stage in the constitutional process, the Government must tell us exactly what they intend. It is clear from their amendments that they intend the HATs to be a one-way street out of the municipal sector, with no option for tenants to return. That proposal must be combined with the premonitions from Wales. I understand that the heads of the Welsh Office housing division have been seconded to work in London with the Treasury, the Cabinet Office and occasionally, the Department of the Environment, with a view to getting £1-down de-municipalisation on to the statute book, either in conjunction with this Bill or even somehow overtaking the Bill along the fast lane of the M4.
The Government should play fair with local government and with the 80 per cent. of council tenants who have not taken advantage of discount purchase. The Government must say exactly what they intend. The Secretary of State has made it clear that the HAT is a one-way street out of council control and that there is no way back, even if the local authority wishes it, but there is a three-way confusion of strangulation, diversification and abdication. That illustrates the appalling muddle in Minister's minds in relation to this Bill, which has so many last-minute lean-to additions as to disqualify Ministers from house building of any kind. They cannot build legislation without changing their minds just as the roof is about to go on and the drains and services are being completed, so how can we possibly judge their intention? It is clear that there will be no way back into a council tenancy, even if the tenant so wishes.
Our amendment No. 90 would implement the original intention that the Government sold to the British public—that the aim of the Bill was diversification and a healthy climate of competition, including municipal housing, housing associations and approved private landlords. It seems, however, that that is no longer the intention. The Secretary of State made that chillingly clear with the suggestion that some or even all councils might not be in the municipal housing business by the time the HATs wind up their work.
It is essential that the Government make a clear statement of their real intention in the light of the schemes floated in the press by the Secretary of State for Wales, the statements about diversification made in Committee by the Minister of State, and the clear statement from the Secretary of State today that the proposal is a one-way street designed to strangle the life out of the municipal sector altogether.

§ Mr. Ridley
The hon. Member for Cardiff, West (Mr. Morgan) has misinterpreted what I said. I repeat, for the benefit of the hon. Gentleman and of the hon. Member for Southwark and Bermondsey (Mr. Hughes), that if tenants wish to return to the local authority and the authority wishes to have them back, they may go back. Indeed, if the local authority commits itself in advance, that can be made clear at the beginning, so the hon. Member for Cardiff, West is far wide of the mark.