HC Deb 30 March 1988 vol 130 cc1115-31 5.25 pm
Mr. John Home Robertson (East Lothian)

I beg to move amendment No. 7, in page 31, line 42, leave out from `Homes;' to end of line 9 on page 32 and insert `and every public sector landlord including regional councils or joint boards or joint committees of two or more regional councils and any trust under the control of a regional council will automatically be so approved. (2) An approval under this section—

  1. (a) shall require the consent of the rent assessment committee in every area in which the new landlord may wish to acquire property;
  2. (b) shall, in relation to any landlord, specify the maximum number to which the approval extends of houses to be acquired by him under this part of this Act; and
  3. (c) in determining the maximum number referred to in Part 52 (2)(b) above Scottish Homes shall in all cases consult with the appropriate rent assessment committee.'.

Mr. Deputy Speaker (Sir Paul Dean)

I understand that it will be for the convenience of the House to discuss also amendment No. 160, in page 32, line 9, at end insert— '(4) The Secretary of State may approve a public sector landlord as an approved person for the purposes of this section where—

  1. (a) the majority of tenants of an approved person have complained in writing to the district council in whose area the houses tenanted are situated as to the financial affairs of, administration of or level of service being offered by such an approved person; and
  2. (b) the Secretary of State, upon enquiry, is satisfied that such a complaint is justified and the acquisition of all of the houses owned by the approved person complained of would be appropriate for the local authority.
(5) The Secretary of State may make regulations under this part of this Act by statutory instrument to provide for the holding of enquiries where complaint has been made by tenants, the determination of such enquiries, and the procedure for acquistion of any property following such an enquiry. (6) A statutory instrument containing an) order or regulation under this part shall be subject to annulment in pursuance of a resolution of either House of Parliament. (7) Orders or regulations under this part may make different provisions for different cases or circumstances or different areas and may contain such incidental provisions as the Secretary of State thinks fit.'.

Mr. Home Robertson

Having listened to the resounding silence of one Under-Secretary of State for Scotland, he who is supposed to be responsible for education—some would call it dumb insolence in his case—I return to the attack on the question of housing in Scotland.

Amendment No. 7 would require local authorities to acquire houses from the private sector, subject to consent from the tenants, and would enable rent assessment committees to monitor and, where necessary, to regulate private landlords in Scotland.

Part III has been described by the Scottish Office publicity machine as a "tenants' choice" mechanism. that must be a new low in dishonesty, even by the threadbare standards of the present Administration in the Scottish Office. Presumably the word "choice" is supposed to imply that all tenants will be able to choose their landlord. However, as we know, the truth in the Bill is very different. Tenants will be totally passive. Part III establishes a framework of "landlords' choice" whereby private landlords will be able to acquire public sector houses at bargain prices under a perverse form of compulsory purchase scheme. That is not tenants' choice; it is more like a landlords' lucky dip at the expense of the local authority and the tenant. The only power that is given to the tenant in this process is to grant his or her consent to the transaction going ahead.

The Government have specifically excluded the possibility of privately owned houses being transferred to the public sector, however much the tenants of privately owned houses might want that transfer to take place. The transfers will be in one direction only and those transfers to the private sector will be irrevocable. There will be no going back once the tenant has allowed that to happen.

The amendment provides for genuine choice by enabling the property to be transferred in either direction, either from the public to the private sector, or the private sector to the public sector. It also provides for safeguards to be applied by the rent assessment committees in the private sector.

The Government clearly see the redevelopment of private landlordism in Scotland as an end in itself. They therefore want to make it easy for private landlords to acquire property cheaply and easily—not by building houses to rent or improving existing property, but by raiding district council housing stock in Scotland. We shall no doubt see further incentives for the private sector, coupled with even more disincentives for the public sector, as part of the Government's doctrinaire and spiteful policy towards Scottish housing.

We in the Labour party want to promote genuine diversification in housing in Scotland. One need look no further than Labour-controlled local authorities, such as Glasgow, Edinburgh, Dundee, Stirling and, indeed, to my own constituency of East Lothian. Labour-controlled local authorities, on a local basis, are promoting housing associations, co-operatives and, indeed, partnership with the private sector, and why not? There is a long list of examples of locally initiated schemes introduced voluntarily by elected local authorities without this heavy-handed interference by central Government.

There is evidence that most Scots who want to rent their homes would prefer to have the option of public sector tenancies. There are examples of that from places as unlikely as the Shetland Islands, where tenants of the Scottish Special Housing Association have made it abundantly clear that they wish to remain in the public sector and would prefer to transfer to local authority tenancies rather than be shuffled into the private sector.

Equally, as my hon. Friend the Member for East Kilbride (Mr. Ingram) said last night, there is overwhelming evidence that the tenants of new town development corporations do not want to be shuffled into the private sector. They want the option of transferring to the local authorities. That is understandable. There will be even stronger demand for public sector tenancies when the true horror of insecurity and high rents that are inherent in the assured tenancy system become well known when and if this wretched Bill reaches the statute book.

May I take the House briefly through the process whereby a private speculator will be able to operate the scheme in part III? First, a representative of the private landlord must persuade a tenant to sign the consent for him to acquire the public sector house concerned. That could involve bribes and inducements, including offers of rent-free periods, and in some instances representatives of speculative landlords may try to trick tenants into giving up their secure tenancies in the public sector and move into insecure tenancies in the private sector. The Scottish Association of Citizens Advice Bureaux has expressed anxiety about the fact that there is no provision for clear advice for tenants in those circumstances.

Having secured the tenant's consent, the acquiring landlord would have to notify the local authority, which would then be obliged to sell the house to the acquiring landlord at the district valuer's valuation. Of course, that will be a low valuation, and it will be even lower since it will be made subject to the secure tenancy that still applies in the public sector.

Finally, unless the tenant withdraws his consent, the landlord can spring the trap. He will have acquired the property at an artificially low valuation and the tenant will immediately lose his rights under the secure tenancy system, including the right to a fair rent, the right to full security, the right to succession and even the right to buy. The tenant would move quickly into the uncharted and insecure waters of assured tenancies. There should be a Government health warning on the assured tenancy system, which will be a recipe for insecurity, eviction and stress for many tenants.

That is not the end of the story. Having acquired a potentially valuable asset on the cheap, the landlord will have an immediate windfall gain, as the value of a house with an insecure tenant is higher than the value of a house with a secure tenant. It will then be open to the landlord to find ways of exploiting the position even further—by forcing up the rent or even trying to get rid of the tenant altogether by evicting him. That will be easy under schedule 5. Then, with vacant possession of the house, the landlord will be able to sell at a vast profit without the local authority having any say in the matter, despite the fact that it built up the asset.

That is indefensible, and a warning should go from the House to Scottish tenants to avoid the trap by refusing to sign anything that may be put before them by fly-by-night landlords who may appear on their doorsteps in the coming months and years. I am especially worried about the loss of special needs housing for rent that could result from the legislation. We have already experienced that in many areas, under the right to buy, and the position could become worse as a result of this landlords' choice mechanism.

The Minister's English counterparts promised significant safeguards in the comparable scheme for England and Wales. They have undertaken to introduce a code of conduct for approved landlords, and they have accepted the principle that transferred tenants should be allowed to return to local authority tenure if they wish. They have also imposed a duty on the housing action trusts—there is no equivalent for Scotland — that may acquire the properties to assist local authorities in housing homeless people. No such duties will be imposed on acquiring landlords in Scotland. No such undertakings have been given for Scotland.

Part III has nothing to do with choice. It is a bare-faced device to allow speculators to plunder the public housing stock under a perverse and unjustifiable form of compulsory purchase scheme. If they want to be involved in rented housing, why do they not build houses, improve existing housing stock or acquire houses voluntarily from the local authority? That happens in Glasgow. But that is too straightforward. It is too much to expect that from the private sector. In Scotland, the private sector has been declining since the beginning of the century. It has dwindled to only 6 per cent. of the Scottish housing stock, and it is absurd for the Government to build a housing policy on the dwindling and discredited private rented sector.

Shelter has informed us that 50 per cent. of the cases of homelessness that have been reported to it in Glasgow came from the private rented sector. How much worse will the position become when the scheme comes into effect? The Government are taking a dangerous risk for tenants in Scotland by trying to found their entire housing policy on people who have failed in the past and who are known to include unscrupulous people who are capable of exploiting and harassing tenants.

Part III is a dishonest and dangerous scheme. The only way in which it can be made to work satisfactorily is to provide for proper regulation of private landlords and to enable local authorities to acquire housing if private tenants wish to change to local authority tenure. That would inject the comprehensive element of choice that is completely lacking from the Bill at present. The amendment would achieve those objectives, and I commend it to the House.

Mr. George Foulkes (Carrick, Cumnock and Doon Valley)

On a point of order, Mr. Deputy Speaker. Is it in order for Conservative Back-Bench Members from Scotland to attend this debate? I do not know whether they have been named—

Mr. Deputy Speaker

Order. The hon. Gentleman knows that that is not a point of order. Let us get on with the debate.

Mr. Norman Hogg (Cumbernauld and Kilsyth)

Further to that point of order, Mr. Deputy Speaker. Would it be in order for Conservative Back-Bench Members from any part of the country to attend this debate?

Mr. Andrew Welsh (Angus, East)

Those interventions have tempted me to say that sometimes I think I miss even the hon. Member for Tayside, North (Mr. Walker) —

Mr. Foulkes

Surely not.

Mr. Welsh

Well, perhaps not.

Amendment No. 7 would allow local authorities to be approved landlords. The Scottish National party amendment, No. 160, represents a fail-safe device to meet the major problems that will arise under this new housing system. The two amendments are interlinked and their basic principle is to allow tenants the extra option of returning to public authority housing.

Amendment No. 160 provides a procedure for the reacquisition of houses by a local authority in circumstances where it would be appropriate for that authority to reacquire them as a purchaser of last resort. As set out in subsection (4)(a) of the amendment, they include circumstances where the majority of tenants of an approved person have complained in writing to the district council in whose area the houses tenanted are situated as to the financial affairs of, administration of or level of service being offered by such an approved person. Allowance is made for the Secretary of State to make inquiries and deal with the problem.

The amendment offers an important form of tenant protection that is missing from the Bill as drafted. The Government assume that all local authorities are bad landlords and that all private landlords are automatically good. The traffic directed by the Bill is all one way—out of the public sector — with no channel of return, even if the tenant wishes to do so. True freedom of choice should work both ways, with citizens having the opportunity freely to opt out or in of the public and private sectors.

The Government's version of free choice stops short at the public sector. My amendment would alter that to allow local authorities to replace private landlords where they have proven themselves to be inferior. That would restore two-way traffic between the private and public sector and offer genuine freedom of choice to the individual.

The Government assume that the transition to a private landlords will only be to the good. My amendment questions that assumption by looking at cases where the majority of transferred tenants are dissatisfied by the deal offered and the services given. The amendment would enable the Secretary of State—if satisfied upon inquiry that such complaint is justified — to allow tenants to return to their preferred tenancy under a local authority. Surely that is offering genuine freedom of choice under controlled and obvious circumstances. I hope that the Government will accept that.

I accept that there is parliamentary supervision and that a set of provisions will follow, but the end product should be greater freedom of choice for tenants and the right freely to choose the best deal whether that is in the public or private sector. If the Bill remains unamended, such choice does not exist. It offers one-way traffic only, with no alternative for those people who prefer the public sector.

My amendment would allow such free choice and would operate to overcome the worse possible problems that would be faced by tenants due to inferior landlord services. The amendment tackles the fundamental question: what happens when something goes wrong after tenants have left the public sector for the private sector? The Government have avoided or plainly ignored that problem. The tenants, however, would suffer from the Government's failure to allow use of the obvious available mechanism to address that problem.

The amendment would offer a public sector option to the existing choice. The amendment allows the Secretary of State to approve a public sector landlord when the tenants have complained in writing to the district council about the financial affairs of, administration of or level of service being offered by such an approved person. The Secretary of State could then make inquiries, and if he was satisfied that the complaints were justified, the local authority could then step in to solve the problem. That authority would meet the needs of those tenants. The amendment proposes an orderly system to sort out that problem.

I hope that the Government will not hide behind ideology. I hope that they will go some way towards allowing a wider choice for tenants and ensure a proper coordination between the private and public sector as providers of housing.

The principle behind the amendment has apparently already been accepted for England and Wales by the Government. I refer the Minister to the proceedings of Standing Committee G when the Minister for Housing and Planning said: we have no difficulty accepting the principle of tenants returning to the local authority if the authority wants to have them. We may need to amend the Bill to make that clear or give assurances."—[Official Report, Standing Committee G. 11 February 1988; c. 810] That offers a clear undertaking that, for England and Wales, tenants will have the right to return to the public sector. Therefore, there should be absolutely no problem for the Minister to give a similar assurance for Scotland. If not, we are entitled to ask why. The Scottish people will draw a suitable conclusion about the Government and their motivations if such an assurance is not given when the Minister replies.

Mr. John McAllion (Dundee, East)

I am still a relatively new Member of the House and I have had a limited experience of the Bills that have been passed in any one parliamentary Session. To paraphrase a former member for a Dundee constituency, I believe that rarely has a Bill promised so much yet delivered so little.

Mr. Foulkes

Does my hon. Friend mean Peter Doig?

Mr. McAllion

I was thinking particularly if Winston Churchill—he was a Liberal then.

We have been repeatedly told by the Minister and indeed by every Conservative Member who spoke in Committee — that was not very many — that the Bill represents a major extension of tenants' rights, notably as a result of the provisions in part III regarding the pick-alandlord scheme. Amendment No. 7 specifically refers to that.

Those who seek to exercise the new right that the Minister is so keen to encourage will find that that very act will mean that they will surrender many of the rights that they possess as public sector tenants. The Minister has not confronted that problem. There will be council tenants who will be frustrated by the inability of their local councils to carry out the major repairs required by their houses and who will therefore succumb to the offers of new windows or whatever the potential private sector landlord may dangle in front of them.

Those tenants may well choose to transfer the ownership of their house from the local council to that private sector landlord. As soon as a tenant does so, he or she immediately loses many of the rights that they currently possess. Indeed, in Committee the Minister told us that he spent one night in the Committee that considered the Tenants' Rights, Etc. (Scotland) Act 1980 defending and promoting the very rights that will be taken as a result of the Bill.

5.45 pm

Tenants stand to lose rights, such as the right to buy their houses. If a tenant moves to a private sector landlord, he immediately loses the right to buy that house at a discount. It is no use the Minister saying that the private sector landlord and tenant should come to an arrangement between themselves as to what price the landlord may sell the house. The success of the sale of council houses has depended on the fact they have been sold at a discount: had they not been sold at a discount, I do not believe that a single council house would have been sold to a sitting tenant.

Tenants will also lose the right to a secured tenancy that is guaranteed by a cast-iron written lease. If they move to the private sector they will also lose the right ever to choose a landlord again. The right that the Minister is seeking to promote today can be exercised only once. If a tenant makes a mistake in exercising that right, the Ministers answer is, "Well, that's tough. You will have to live with that mistake".

There is no provision for people to return to the public sector if they find themselves in the grip of some Rachman-type landlord who is exploiting them. The Minister believes that that is just hard luck. The amendment tabled by the hon. Member for Angus, East (Mr. Welsh) attempts to resolve that problem. That amendment offers tenants an emergency way out, and I hope that the Minister considers it seriously.

Someone may choose a landlord who, to begin with, may seem rational and reasonable. That landlord may offer them new windows, new doors, new heating systems and so on. However, once they are under the control of that landlord, the rents go up and the villainy starts. Those tenants may then wish to get away from that landlord, but they cannot. The Minister must address that problem.

The Bill, far from extending tenants' rights, represents an attack upon them. The Bill also takes away those rights in an indirect manner. Earlier in our discussions, I mentioned the views of tenants in my constituency who are representatives of tenants' organisations, especially in the Whitfield area. They emphasised the importance of being local authority tenants and the many facilities that are made available to them by the local authorities to enable them to come together to organise into a tenants' organisation to try to improve their environment.

The local authority has made available to those tenants a house or flat free of charge and has also given them direct aid in the form of grants to enable them to meet the expense of establishing such tenant organisations.

Without such direct assistance from local authorities, such tenants' organisations could not survive for any length of time. As Part III of the Bill stands, if tenants make a decision to move from the public to the private sector all such facilities will be denied them. The Minister should concede that it is frankly inconceivable that any private sector landlord will make available a house or flat, free of rent, for such tenant organisations.

It is inconceivable that any private landlord would give direct aid in the form of grants to such tenant organisations to enable them to work together in their interests — by their nature, such interests must be in direct conflict with the landlord's interests. The Minister must come to grips with the fact that local authorities in the public sector are different from the private sector and take a much more enlightened view of their relationships with tenants than any private sector landlords.

The Minister came to Dundee and announced a grant of more than £6 million for the Ormiston crescent tenants' co-operative, and everyone was grateful for that. He should know from his experience, therefore, that tenants in Whitfield were able to form a co-operative because in the previous year they had worked closely with the elected officials of the district council, who had brought them to a state of readiness in which they were able to form the cooperative and make a success of it.

That sort of work will not be done in the private sector; it can only be done in the public sector. By encouraging people to move from the latter to the former, the Minister is encouraging them to give up the potential to form themselves into co-operatives, of which he says he is in favour.

The amendment will give tenants a genuine choice—not the one-sided choice of leaping from the public to the private sector but the choice to do what they want; not, as the hon. Member for Tayside, North (Mr. Walker) said yesterday, what the Government and Tory Back Benchers think they should want. That is an important distinction, and there is overwhelming evidence of what tenants want.

In Committee, we dealt with the views of Scottish Special Housing Association tenants and discussed whether they were enraptured with the Bill's provisions. The SSHA tenants made it clear that they did not want the new Scottish Homes agency as their landlord. They wanted to remain tenants of the SSHA and to be left alone by the Government. They wanted a ballot in which to make clear exactly what they felt about the Government's propsals, but the Minister denied them that.

The whole affair was summed up by Mr. Derek Mason, the chairman of the SSHA, whom I quoted in Committee as asking what the point of having a ballot was when we already knew what the result would be. Almost all SSHA tenants would vote against the Scottish Homes proposals, yet the Minister has denied them the ballot. We know what the outcome would be, but that does not suit the Government. They favour the ballot box only when the outcome suits them; they are against ballots that vote against their proposals.

Any hon. Member who has attended the scores of public meetings that have been held to discuss Scottish Homes will understand what I am saying. I shall be attending two meetings in Dundee next week that have been organised by tenants' organisations which have come into being since the introduction of this Bill to defend tenants against its attacks on them. Tenants are united in their condemnation of Scottish Homes and demand the right to transfer from the SSHA into the local authority sector, not the private sector. They know that the local authority sector offers them much more in the long term than they can ever possibly get from the private sector, the more so once they have a Government who properly fund local authorities and allow them to provide the services that they are anxious to supply.

This is not only a matter of facilities being provided for tenants' organisations, or the co-operation between local authorities and their tenants that enables the latter to form co-operatives—it is a question of rent levels, too. SSHA tenants will say that they would rather be local authority tenants because that means lower rents. Transferring to the private sector even now means increased rents; transferring to the council sector, lower rents. That is one of the most attractive things about local authorities in tenants' eyes.

It is no good the Minister or his Scottish Back Benchers —none of whom are present—lecturing Scottish local authorities about having far too low rent levels. Dundee has the second lowest rent levels of any major city in Scotland, but 60 per cent. of its tenants need housing benefit to pay their rents. Nevertheless, the Minister wants to put up those rents and pauperise more tenants. Perhaps he will not be happy until 100 per cent. are on housing benefit, or perhaps he means to drive them all out of the public sector. That is the spirit behind the Bill.

The legislation is a dreadful attack on the public sector provision of housing in Scotland. It is an undisguised onslaught upon it, which is why all who are genuinely interested in tackling Scotland's housing problems should unite in supporting the amendments.

The Parliamentary Under-Secretary of State for Scotland (Lord James Douglas-Hamilton)


Mr. Sam Galbraith (Strathkelvin and Bearsden)

On a point of order, Mr. Deputy Speaker. Is it in order and fair that the Minister should have to stand at the Dispatch Box discussing a subject of which he has but a tenuous grasp, without the support of any of his Scottish Back Benchers? Do you have any powers to drag some of those Back Benchers—

Mr. Deputy Speaker

Order. We had better get on with the debate.

Lord James Douglas-Hamilton

I am glad to respond to the debate. The hon. Member for East Lothain (Mr. Home Robertson) asked why there was a need for the tenants' choice provisions, as much of the progress that has already been made towards co-operatives is being made without legislation. The answer is that disposals of local authority property to co-operatives require both the Secretary of State's approval and the co-operation of the local authorities. The Bill extends rights to tenants to transfer, whether or not the local authority agrees and without the need for approval by the Secretary of State — so it represents an extension of opportunity and choice.

The hon. Member for East Lothian said that it was important to have guidance in an appropriate form for local authority tenants. Under clause 2(2)(e), appropriate guidance and advice will be given by Scottish Homes to tenants, and rightly so.

The hon. Member for Angus, East (Mr. Welsh) asked what would happen if something went wrong. It would be the responsibility of Scottish Homes to approve a landlord and monitor the situation, and to help to avoid any problem arising. If one arose, it would be the responsibility of Scottish Homes to ensure that another housing association took over. If that was not possible, the landlord division of Scottish Homes would have to take responsibility. That was an important point that we considered in Committee.

Mr. Andrew Welsh

The blindingly obvious alternative is to say that local authorities, which have housing, could also solve that problem, so why not use the existing mechanism?

Lord James Douglas-Hamilton

There are a number of reasons why not. We believe in extending opportunity and choice, but local authorities in some areas already have 80 per cent. of the stock. If we gave the right to transfer to local authorities within the public sector and from the private sector back to the public sector, that would lead to a perpetual merry-go-round and cause a bureaucratic nightmare.

Mr. McAllion

Does the Minister accept that he should be trying to facilitate what the tenants want, not what the Government want? If tenants in a given area decide that they all want to be local authority tenants, that is a matter for them, not for the Minister or me.

Lord James Douglas-Hamilton

We are approaching the matter highly pragmatically by giving an extension of opportunity, whether or not that opportunity is taken up; that is a matter for the tenants, as the hon. Gentleman says. If they do not want to take it up, they will not.

It is correct that accurate information will have to be given to tenants well before any choice could be exercised under the Bill. If tenants, however, do not want to transfer, that will be the end of the matter—

Mr. Andrew Welsh


Lord James Douglas-Hamilton

Amendment No. 7 seeks, first, to open up the tenants' choice provisions to allow transfer to public sector landlords and, secondly, to create a role in tenants' choice transfer procedures for local rent assessment committees. I do not believe the House should accept either purpose.

Part III of the Bill seeks to widen the choice of tenure available to tenants in the public sector. In many areas, as I mentioned, choice is severely restricted, with many areas having 60 per cent. local authority housing, and in some it is almost as high as 80 per cent. Amendment No. 7 would increase local authorities' holdings and thus intensify the difficulties that they face in providing a satisfactory level of service for their tenants. That is not the purpose of part III of the Bill. Our aim is to diversify tenure, not to reinforce existing near-monopolies—

Mr. Galbraith


Lord James Douglas-Hamilton

I shall make one further point and then allow the hon. Gentleman to intervene.

Of course, the provisions in this part of the Bill which preclude transfer from one public sector landlord to another, except to Scottish Homes, do not rule out completely tenants transferring to public sector landlords. The Secretary of State can, for example, under section 12(7) of the Housing (Scotland) Act 1987, approve sales by a local authority of any of its stock. As I said in Committee, this power has been used on a number of occasions. For example, the transfer of large numbers of houses from Glasgow district council to the SSHA in Castlemilk and the transfer of stock to housing co-operatives, are covered by this section.

Moreover, it will still be possible for a local authority, without consent, to acquire property under section 2(1)(c) and section 9 of the Housing (Scotland) Act 1987 if it wishes to do so, and provided it is prepared to give priority, within its capital allocation, to the purchase. Such property could, I believe, include tenanted property, and any such transfers would in practice require the tenants' consent. I repeat that the provisions in part III do not rule out transfers to public sector authorities under other arrangements.

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Mr. Galbraith

I must come back to the point that I made, because the Minister talks about diversifying the tenure. Why will he not allow the tenure to be the choice of the tenant? Will he diversify the tenure by forcing tenants in one direction? This is a disgraceful example of the Government's political eugenics. Why will the Minister not allow tenants to make their own choice? Why must he force them against their wishes to go for a form of tenancy that they do not want? Why can they not have the choice?

Lord James Douglas-Hamilton

There is no question of any compulsion. This is an extension of opportunity, and in due course it will be entirely a matter for tenants as to whether they take up that opportunity.

Mr. Galbraith


Lord James Douglas-Hamilton

No, I shall not give way. I have answered the hon. Gentleman's question. There is quite clearly no element of compulsion. That was the essence of the hon. Gentleman's question, and I have answered it. He may not like the answer, but I repeat that there is no way in which there will be any element of compulsion in the proposals that I am putting before the House.

Mr. John McFall (Dumbarton)

I should like to ask the Minister for information about co-operatives. If some cooperatives decide to transfer to a private landlord and others do not, are the individual rights of people guaranteed, or will the transfer be subject to a majority decision of the tenants? I am interested in individual cases.

Lord James Douglas-Hamilton

In the two kinds of cooperatives that I know—management co-operatives and ownership co-operatives— the decision about forming a co-operative is a matter for the tenants. The hon. Gentleman's suggestion is a novel one that I have not heard about. He spoke about a co-operative transferring to a different form of ownership. An ownership cooperative is owned by the tenants, and that is a matter for them.

I shall now return to the role suggested in the amendment for local rent assessment committees. When considering applications for approval for prospective new landlords, Scottish Homes will of course be expected to conduct careful inquiries. In guiding Scottish Homes in the exercise of its duties, the Secretary of State will encourage it to maintain the closest possible links with local bodies, and particularly with local authorities.

We would not wish to impose on Scottish Homes, when it exercises its various duties under the Bill, a statutory requirement to consult any particular body, whether it be the local authority, the local rent assessment committee or whatever. Nor do we think it reasonable to impose on Scottish Homes a requirement that all approvals must set a limit to the number of houses any receiving landlord can acquire. Clause 54(2) (c) already allows Scottish Homes to impose such a limit where it believes that this is required.

Amendment No. 7 suggests, in effect, a requirement that any private sector receiving landlord should go through two approval processes, by Scottish Homes and by the local rent assessment committee. This double approval mechanism is neither necessary nor desirable. I repeat that we cannot support the inclusion of public sector housing authorities as receiving landlords.

Mr. Tam Dalyell (Linlithgow)

Has the Scottish Office issued any guidelines to local rent assessment committees? If it has, what criteria do those guidelines suggest?

Lord James Douglas-Hamilton

The hon. Gentleman asks about guidelines. I imagine that he is posing his question in the context of tenants' choice. I can tell the hon. Gentleman what I have said in Committee—that the fullest possible information will have to be made available to tenants. The hon. Gentleman's question may well be a future question for consideration by Scottish Homes when it has been set up.

Mr. Home Robertson

The hon. Gentleman is the Minister.

Lord James Douglas-Hamilton

I agree, but the hon. Gentleman must appreciate that when a responsible body such as Scottish Homes is set up, it has a responsibility to take seriously its duties as they are set out in the Bill. The Secretary of State has power under the Bill to give directions if Scottish Homes does not properly carry out its responsibilities.

I should now like to speak to amendment No. 160. I suspect that the amendment as drafted goes rather further than intended. It would mean that, once a landlord had been approved by Scottish Homes as a receiving landlord under this part of the Bill, a majority of that landlord's tenants could petition the Secretary of State to hold a public inquiry. The tenants coming together in this way need not include any who had transferred to the landlord under the tenants' choice provisions.

The amendment suggests not just a return ticket to the public sector in the unlikely event of an approved landlord letting down its new tenants, but a possible transfer to the public sector of other tenants of that landlord or, for example, tenants of a housing association who have had no previous link with the public sector. We see part Ill as a means of breaking down local authority monopolies. The amendment could well tend to reinforce monopolies.

Mr. Andrew Welsh

If the democratic majority of tenants have a crummy landlord and wish to have a better housing service, and if they could get that from the public sector, why should they not have that democratic right of choice?

Lord James Douglas-Hamilton

The hon. Gentleman says that if a housing association is set up and a majority of tenants say that they wish to transfer to a local authority, they should have the power to do that. That is certainly not part of our proposals. For example, if a company did up a block of flats and the majority of tenants said that they wanted to transfer to the local authority, that would virtually amount to compulsory purchase, and that is certainly not part of our proposals.

Let us look at the amendment in more detail. First, Scottish Homes' approval to receiving landlords will not be given lightly, and Scottish Homes will be expected to monitor approved landlords" performance. Many of the receiving landlords under tenants' choice will be registered housing associations, responsibility for which will be taken over by Scottish Homes from the Housing Corporation in Scotland. In such cases, Scottish Homes can and will take action to safeguard the position of tenants long before the difficulties that the amendment suggests might occur would reach the state of affairs suggested.

If Scottish Homes' advice and assistance fails to prevent the level of service offered by the landlord from deteriorating in the way suggested, what the amendment proposes would be equivalent to compulsory purchase. The local authority would be given the right to acquire property from the private sector. There is a very considerable difference in principle between introducing legislation under which rights are given to acquire property from the public sector, where public money has been involved in providing the property, and seeking to permit compulsory removal of property from the private sector. I hope that the hon. Gentleman will withdraw his amendments; otherwise, I shall have to ask the House to oppose them.

The hon. Member for East Lothian said that concessions had been promised in the English Bill to recognise the possibility of tenants who had transferred from the public sector returning to local authorities. It has been suggested that a similar concession should be made in Scottish legislation. The positions are not exactly comparable. For example, the undertaking given by the Minister for Housing and Planning in the Department of the Environment does not relate to transfer under tenants' choice provisions. That undertaking was given in the context of the English housing action trust provisions. We should not confuse the two initiatives.

Under tenants' choice, the tenant has complete discretion on the question of whether to seek a new landlord. That is not the case under English housing action trust proposals. It is not unreasonable, therefore, that, when the trust is disposing of housing stock, tenants who so wish should be able to move back to the local authority, if the authority wishes to resume landlord responsibilities. I must make it clear that housing action trusts form no part of the Scottish legislative proposals. It is therefore very much a red herring to complain that undertakings given in another debate in a different context have not been repeated in our consideration of the legislation.

The hon. Gentleman also mentioned a code of conduct. We discussed on many occasions in Committee the question of ensuring that landlords who are in receipt of public money or who are approved for the purposes of tenants' choice provide a good housing service to their tenants. There is a variety of ways of achieving that and different methods may be appropriate for different circumstances. It may be sensible to have different mechanisms relating to registered housing associations and to approve tenants' choice landlords. I am aware that various proposals have been discussed in England, but, given our Scottish Homes proposals, it would be sensible to consider separately the right approach for Scotland.

6.15 pm
Mr. Home Robertson

The Minister said that the Government were opposed to the principle of compulsory purchase in the context of the amendment moved by the Opposition. That must be the most spectacular example of doublespeak that has come from any Minister, although we are accustomed to the Minister becoming confused in the context of the legislation. If the Minister is opposed to the principle of compulsory purchase, why is part III in the Bill? It provides for the compulsory purchase by private landlords of public sector property whatever the broader interests of the local communities might be.

The Minister frequently parrots the slogan that this part of the Bill extends tenants' rights. He should not believe the briefs put in front of him by his officials at the Scottish Office. He will find that it does no such thing. The Bill establishes rights for ambitious landlords to acquire public property at low prices. It is a lucky dip for profiteering landlords. The Minister knows that and the House should be aware of that. This is blatantly one-sided legislation because it allows the private sector to acquire public assets at knockdown prices, but establishes no parallel right, even where there may be an overwhelming case, for private sector propery to be taken over by the public sector, when the tenants desperately want that. The tenants have no rights in that respect. The only rights built into this part of the legislation are for acquiring landlords.

The Minister made it clear that the Government are simply expressing their prejudice against local authority housing in spite of the fact that he knows perfectly well that the majority of people who want to rent their houses in Scotland would prefer to rent on a secure basis with a fair rent in the public sector.

If the Minister is not aware of that, as he happens to be one of my constituents, I invite him to come along on a Saturday to one of my surgeries in the town where he lives. He will be able to hear the views of private sector tenants who would like to choose the option to move into the public sector, but cannot do so because the Government will not allow the local authorities to provide the housing required.

The Government are denying opportunities for many tenants in Scotland. There is no support for their measure. That is borne out by the fact that no Scottish Tory Back Benchers have come along to speak in support of the Government. They have not even been present in the Chamber during the debate.

There is no case for the Government's proposals, but there is every case for amendment No. 7 and I urge the House to support it.

Mr. Andrew Welsh


Mr. Deputy Speaker (Mr. Harold Walker)

Does the hon. Gentleman have the leave of the House to speak again?

Hon. Members


Mr. Deputy Speaker

Leave withheld. The hon. Gentleman cannot speak again. He does not have the right of reply. His amendment has not been moved.

Mr. Welsh


Mr. Deputy Speaker

Order. I refer the hon. Gentleman to page 421 of "Erskine May".

Question put, That the amendment be made :—

The House divided: Ayes 202, Noes 233.

Division No. 242] [6.16 pm
Abbott, Ms Diane Blair, Tony
Adams, Allen (Paisley N) Bradley, Keith
Allen, Graham Brown, Gordon (D'mline E)
Alton, David Brown, Nicholas (Newcastle E)
Archer, Rt Hon Peter Brown, Ron (Edinburgh Leith)
Armstrong, Hilary Bruce, Malcolm (Gordon)
Ashdown, Paddy Buchan, Norman
Ashley, Rt Hon Jack Buckley, George J.
Banks, Tony (Newham NW) Callaghan, Jim
Barnes, Harry (Derbyshire NE) Campbell, Menzies (Fife NE)
Barron, Kevin Campbell, Ron (Blyth Valley)
Beckett, Margaret Campbell-Savours, D. N.
Beith, A. J. Canavan, Dennis
Benn, Rt Hon Tony Clark, Dr David (S Shields)
Bennett, A. F. (D'nt'n & R'dish) Clarke, Tom (Monklands W)
Bidwell, Sydney Clay, Bob
Clelland, David Lestor, Joan (Eccles)
Clwyd, Mrs Ann Lewis, Terry
Cohen, Harry Litherland, Robert
Coleman, Donald Livingstone, Ken
Cook, Frank (Stockton N) Livsey, Richard
Cook, Robin (Livingston) Lloyd, Tony (Stretford)
Corbett, Robin Lofthouse, Geoffrey
Corbyn, Jeremy Loyden, Eddie
Cousins, Jim McAllion, John
Cox, Tom McAvoy, Thomas
Crowther, Stan McCartney, Ian
Cryer, Bob Macdonald, Calum A.
Cummings, John McFall, John
Dalyell, Tam McKay, Allen (Barnsley West)
Darling, Alistair McKelvey, William
Davies, Rt Hon Denzil (Llanelli) McLeish, Henry
Davies, Ron (Caerphilly) McNamara, Kevin
Davis, Terry (B'ham Hodge H'l) McTaggart, Bob
Dewar, Donald McWilliam, John
Dixon, Don Madden, Max
Dobson, Frank Marek, Dr John
Doran, Frank Marshall, David (Shettleston)
Douglas, Dick Marshall, Jim (Leicester S)
Duffy, A. E. P. Maxton, John
Dunnachie, Jimmy Meacher, Michael
Dunwoody, Hon Mrs Gwyneth Meale, Alan
Eadie, Alexander Michael, Alun
Eastham, Ken Michie, Bill (Sheffield Heeley)
Evans, John (St Helens N) Michie, Mrs Ray (Arg'l & Bute)
Ewing, Harry (Falkirk E) Millan, Rt Hon Bruce
Ewing, Mrs Margaret (Moray) Mitchell, Austin (G't Grimsby)
Fatchett, Derek Moonie, Dr Lewis
Field, Frank (Birkenhead) Morgan, Rhodri
Fields, Terry (L'pool B G'n) Morris, Rt Hon J. (Aberavon)
Flannery, Martin Mullin, Chris
Flynn, Paul Murphy, Paul
Foot, Rt Hon Michael Nellist, Dave
Foster, Derek Oakes, Rt Hon Gordon
Foulkes, George O'Brien, William
Fraser, John O'Neill, Martin
Galbraith, Sam Orme, Rt Hon Stanley
Galloway, George Parry, Robert
Garrett, John (Norwich South) Patchett, Terry
Garrett, Ted (Wallsend) Pendry, Tom
George, Bruce Pike, Peter L.
Gilbert, Rt Hon Dr John Powell, Ray (Ogmore)
Godman, Dr Norman A. Prescott, John
Gordon, Mildred Primarolo, Dawn
Gould, Bryan Quin, Ms Joyce
Graham, Thomas Radice, Giles
Griffiths, Nigel (Edinburgh S) Randall, Stuart
Griffiths, Win (Bridgend) Richardson, Jo
Grocott, Bruce Robertson, George
Hardy, Peter Robinson, Geoffrey
Hattersley, Rt Hon Roy Rogers, Allan
Healey, Rt Hon Denis Rooker, Jeff
Heffer, Eric S. Ruddock, Joan
Henderson, Doug Salmond, Alex
Hinchliffe, David Sedgemore, Brian
Hogg, N. (C'nauld & Kilsyth) Sheerman, Barry
Home Robertson, John Sheldon, Rt Hon Robert
Hood, Jimmy Shore, Rt Hon Peter
Howarth, George (Knowsley N) Skinner, Dennis
Howell, Rt Hon D. (S'heath) Smith, Andrew (Oxford E)
Howells, Geraint Smith, C. (Isl'ton & F'bury)
Hoyle, Doug Smith, Rt Hon J. (Monk'ds E)
Hughes, John (Coventry NE) Snape, Peter
Hughes, Robert (Aberdeen N) Spearing, Nigel
Hughes, Roy (Newport E) Steinberg, Gerry
Hughes, Sean (Knowsley S) Stott, Roger
Hughes, Simon (Southwark) Strang, Gavin
Illsley, Eric Straw, Jack
Ingram, Adam Taylor, Mrs Ann (Dewsbury)
Janner, Greville Taylor, Rt Hon J. D. (S'ford)
John, Brynmor Taylor, Matthew (Truro)
Jones, Barry (Alyn & Deeside) Vaz, Keith
Kinnock, Rt Hon Neil Wall, Pat
Kirkwood, Archy Wallace, James
Lamond, James Walley, Joan
Leadbitter, Ted Wardell, Gareth (Gower)
Wareing, Robert N. Worthington, Tony
Welsh, Andrew (Angus E) Wray, Jimmy
Williams, Rt Hon Alan Young, David (Bolton SE)
Williams, Alan W. (Carm'then)
Wilson, Brian Tellers for the Ayes:
Winnick, David Mr. Frank Haynes and
Wise, Mrs Audrey Mrs. Llin Golding.
Adley, Robert Douglas-Hamilton, Lord James
Aitken, Jonathan Dover, Den
Alexander, Richard Dunn, Bob
Alison, Rt Hon Michael Eggar, Tim
Allason, Rupert Fallon, Michael
Amess, David Farr, Sir John
Amos, Alan Favell, Tony
Arbuthnot, James Field, Barry (Isle of Wight)
Arnold, Jacques (Gravesham) Fookes, Miss Janet
Arnold, Tom (Hazel Grove) Forman, Nigel
Ashby, David Forth, Eric
Atkinson, David Fowler, Rt Hon Norman
Baker, Rt Hon K. (Mole Valley) Fox, Sir Marcus
Baker, Nicholas (Dorset N) Franks, Cecil
Baldry, Tony Freeman, Roger
Banks, Robert (Harrogate) French, Douglas
Batiste, Spencer Fry, Peter
Beaumont-Dark, Anthony Gale, Roger
Bendall, Vivian Gardiner, George
Bennett, Nicholas (Pembroke) Garel-Jones, Tristan
Benyon, W. Gill, Christopher
Bevan, David Gilroy Glyn, Dr Alan
Biffen, Rt Hon John Goodlad, Alastair
Blackburn, Dr John G. Goodson-Wickes, Dr Charles
Blaker, Rt Hon Sir Peter Gorman, Mrs Teresa
Bonsor, Sir Nicholas Grant, Sir Anthony (CambsSW)
Boscawen, Hon Robert Greenway, Harry (Ealing N)
Bottomley, Peter Grylls, Michael
Bottomley, Mrs Virginia Gummer, Rt Hon John Selwyn
Bowden, A (Brighton K'pto'n) Hampson, Dr Keith
Bowden, Gerald (Dulwich) Hargreaves, Ken (Hyndburn)
Bowis, John Harris, David
Boyson, Rt Hon Dr Sir Rhodes Haselhurst, Alan
Braine, Rt Hon Sir Bernard Hayward, Robert
Brandon-Bravo, Martin Higgins, Rt Hon Terence L.
Brazier, Julian Hind, Kenneth
Bright, Graham Hogg, Hon Douglas (Gr'th'm)
Brittan, Rt Hon Leon Howarth, Alan (Strat'd-on-A)
Brooke, Rt Hon Peter Howarth, G. (Cannock & B'wd)
Brown, Michael (Brigg & Cl't's) Hughes, Robert G. (Harrow W)
Browne, John (Winchester) Hunt, David (Wirral W)
Bruce, Ian (Dorset South) Hunter, Andrew
Budgen, Nicholas Irvine, Michael
Burns, Simon Johnson Smith, Sir Geoffrey
Burt, Alistair Jones, Robert B (Herts W)
Butcher, John Kellett-Bowman, Dame Elaine
Butler, Chris Kilfedder, James
Carlisle, John, (Luton N) King, Roger (B'ham N'thfield)
Carlisle, Kenneth (Lincoln) Knapman, Roger
Carrington, Matthew Knight, Greg (Derby North)
Carttiss, Michael Knight, Dame Jill (Edgbaston)
Cash, William Knox, David
Chalker, Rt Hon Mrs Lynda Lang, Ian
Channon, Rt Hon Paul Lawrence, Ivan
Chapman, Sydney Lee, John (Pendle)
Chope, Christopher Leigh, Edward (Gainsbor'gh)
Clark, Dr Michael (Rochford) Lennox-Boyd, Hon Mark
Clark, Sir W. (Croydon S) Lester, Jim (Broxtowe)
Colvin, Michael Lightbown, David
Cope, John Li 1 ley, Peter
Cormack, Patrick Lloyd, Peter (Fareham)
Cran, James Luce, Rt Hon Richard
Critchley, Julian McCrindle, Robert
Currie, Mrs Edwina Macfarlane, Sir Neil
Curry, David MacGregor, Rt Hon John
Davies, Q. (Stamf'd & Spald'g) MacKay, Andrew (E Berkshire)
Davis, David (Boothferry) McLoughlin, Patrick
Day, Stephen McNair-Wilson, M. (Newbury)
Devlin, Tim McNair-Wilson, P. (New Forest)
Dickens, Geoffrey Madel, David
Dorrell, Stephen Malins, Humfrey
Mans, Keith Shaw, Sir Michael (Scarb')
Marshall, John (Hendon S) Shephard, Mrs G. (Norfolk SW)
Marshall, Michael (Arundel) Shepherd, Colin (Hereford)
Martin, David (Portsmouth S) Shersby, Michael
Maxwell-Hyslop, Robin Sims, Roger
Mellor, David Skeet, Sir Trevor
Meyer, Sir Anthony Smith, Tim (Beaconsfield)
Miller, Hal Spicer, Sir Jim (Dorset W)
Miscampbell, Norman Squire, Robin
Mitchell, Andrew (Gedling) Stanbrook, Ivor
Mitchell, David (Hants NW) Steen, Anthony
Moate, Roger Stern, Michael
Monro, Sir Hector Stewart, Andy (Sherwood)
Montgomery, Sir Fergus Stewart, Ian (Hertfordshin N)
Morrison, Hon Sir Charles Sumberg, David
Moss, Malcolm Summerson, Hugo
Neale, Gerrard Tapsell, Sir Peter
Nelson, Anthony Taylor, Ian (Esher)
Neubert, Michael Taylor, John M (Solihull)
Nicholls, Patrick Taylor, Teddy (S'end E)
Nicholson, David (Taunton) Tebbit, Rt Hon Norman
Nicholson, Emma (Devon West) Temple-Morris, Peter
Onslow, Rt Hon Cranley Thompson, D. (Calder Valley)
Oppenheim, Phillip Thompson, Patrick (Norwich N)
Page, Richard Thornton, Malcolm
Patten, Chris (Bath) Tracey, Richard
Pawsey, James Tredinnick, David
Porter, Barry (Wirral S) Twinn, Dr Ian
Porter, David (Waveney) Vaughan, Sir Gerard
Portillo, Michael Waddington, Rt Hon David
Powell, William (Corby) Wakeham, Rt Hon John
Price, Sir David Wardle, Charles (Bexhill)
Raffan, Keith Warren, Kenneth
Raison, Rt Hon Timothy Watts, John
Rathbone, Tim Wells, Bowen
Redwood, John Wheeler, John
Renton, Tim Widdecombe, Ann
Riddick, Graham Wilkinson, John
Ridley, Rt Hon Nicholas Wilshire, David
Ridsdale, Sir Julian Wolfson, Mark
Roberts, Wyn (Conwy) Wood, Timothy
Rossi, Sir Hugh Woodcock, Mike
Ryder, Richard Yeo, Tim
Sackville, Hon Tom
Sainsbury, Hon Tim Tellers for the Noes:
Scott, Nicholas Mr. Tony Durant and
Shaw, David (Dover) Mr. David Maclean.
Shaw, Sir Giles (Pudsey)

Question accordingly negatived.

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