HC Deb 07 February 2001 vol 362 cc998-1020

'. The Secretary of State shall by regulations bring Schedule (Energy efficiency reports) into effect within twelve months of the passing of this Act.'.—[Mr. Loughton.]

Brought up, and read the First time.

7.43 pm
Mr. Loughton

I beg to move, That the clause be read a Second time.

Madam Deputy Speaker

With this it will be convenient to discuss the following: New clause 14—Energy efficiency report (No. 2)— '. The Secretary of State may by regulations bring Schedule (Energy efficiency reports) into effect within twelve months of the passing of this Act if in his judgement it would assist, or provide information relevant to, the marketing of residential properties in England and Wales.'.

Government amendments Nos. 22 and 23.

New schedule 1—'Energy Efficiency Reports—

  1. '1.—(1) Subject to the provisions of this Schedule, it shall be the duty of any person in whose favour a mortgage of any legal estate in a dwelling is granted (in this Schedule referred to as "the lender") to ensure that, if any qualifying survey of the dwelling has been undertaken by him or on his behalf in connection with that mortgage—
    1. (a) a report on the energy efficiency of the dwelling (in this Schedule referred to as "an energy efficiency report") has been prepared by or on behalf of the lender in accordance with regulations under paragraph 5 on the basis of the physical inspection undertaken for the purpose of the qualifying survey, and
    2. (b) the person granting the mortgage (in this Schedule referred to as "the borrower") has been provided, before the grant of the mortgage, with a copy of the energy efficiency report.
  2. (2) No duty arises under sub-paragraph (1) unless—
    1. (a) the mortgage relates only
      1. (i) to a single dwelling, or
      2. (ii) to a single dwelling together with premises occupied or intended to be occupied for business purposes,
    2. (b) the loan to which the mortgage relates was made in pursuance of an application made to the lender by the borrower, and
    3. (c) the dwelling is occupied by, or is intended for occupation by, the borrower as his residence.
  3. (3) The lender may, in fixing the amount of any fee to be charged for a qualifying survey, take into account any additional costs reasonably incurred in preparing the energy efficiency report, but the duty in sub-paragraph (1) arises whether or not the borrower has paid, or agreed to pay, any such additional costs.
  4. (4) In sub-paragraph (1) a "qualifying survey", in relation to a dwelling, means any survey or valuation which includes a physical inspection of both the exterior and the interior of the dwelling.
  5. 2. The duty in paragraph 1 does not arise in relation to any dwelling which was provided (by construction or conversion) less than three years before the date on which the borrower applied for the loan to which the mortgage relates.
    6. 999
  6. 3. The duty in paragraph 1 does not arise where, before the grant of the mortgage, the borrower has obtained, or been given a copy of, a report which—
    1. (a) relates to the dwelling,
    2. (b) complies with regulations under paragraph 5, and
    3. (c) was prepared less than twelve months before the date on which the borrower applied for the loan to which the mortgage relates.
  7. 4.—(1) The duty in paragraph 1 does not arise where—
    1. (a) the lender is a member of the borrower's family and is not lending in the course of a business carried on by the lender, or
    2. (b) the lenders are the trustees of a trust created by an individual for the benefit of members of his family and their descendants.
  8. (2) For the purposes of sub-paragraph (1) a person is a member of another's family if—
    1. (a) he is the spouse of that person, or he and that person live together as husband and wife, or
    2. (b) he is that person's parent, grandparent, child, grandchild, brother, sister, uncle, aunt, nephew or niece.
  9. (3) For the purposes of sub-paragraph (2)(b)—
    1. (a) a relationship by marriage shall be treated as a relationship by blood,
    2. (b) a relationship of the half-blood shall be treated as a relationship of the whole blood, and
    3. (c) the stepchild of a person shall be treated as his child.
  10. 5.—(1) The Secretary of State shall make regulations specifying the requirements which must be met by the lender in relation to the preparation of an energy efficiency report.
  11. (2) The regulations may, in particular, require a report to include—
    1. (a) information as to the presence or absence in the dwelling of specified measures for improving energy efficiency, and
    2. (b) a statement recommending measures which could be taken for the purpose of improving energy efficiency.
  12. (3) Regulations under this paragraph may make different provision for different cases and different areas.
  13. (4) Regulations under this paragraph may not require an energy efficiency report to contain any information in respect of the dwelling which is not readily ascertainable on a visual inspection of so much of the exterior and interior of the dwelling as is accessible without undue difficulty to the person undertaking the inspection.
  14. (5) Regulations under this paragraph may not require an energy efficiency report in respect of a flat to contain information about the common parts of the building in which the flat is situated.
  15. (6) Before making regulations under this paragraph, the Secretary of State shall consult—
    1. (a) such mortgage lenders or persons appearing to him to represent mortgage lenders as he considers appropriate, and
    2. (b) such other persons as he considers appropriate.
  16. (7) In making regulations under this paragraph, the Secretary of State shall have regard to the cost of preparing an energy efficiency report.
  17. (8) Regulations under this paragraph shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.
  18. (9) In this paragraph—
  19. 6.—(1) If the borrower suffers loss by reason of the failure of the lender to comply with his duty under paragraph 1, the borrower is entitled to compensation for that loss from the lender.
  20. (2) In determining for the purposes of this paragraph whether the borrower has suffered loss as mentioned in sub-paragraph (1) and, if so, the amount of that loss, a court—
    1. (a) shall assume that the borrower would have taken every measure that would have been recommended in a report complying with paragraph 5,
    2. (b) shall have regard to the cost that would be likely to have been incurred in taking those measures if they had been taken immediately after the grant of the mortgage,
    3. (c) shall determine the likely expected life of each measure and apportion that cost rateably over that life, and
    4. (d) shall calculate the savings that would have been made during the relevant period if the measures had been taken.
  21. (3) In sub-paragraph (2) "the relevant period" means the period beginning with the day on which the mortgage was granted and ending immediately before the sixth anniversary of that day or, if earlier—
    1. (a) in relation to any measure falling within sub-paragraph (2)(a) which has in fact been taken by the borrower, with the day on which the taking of the measure is completed.
    2. (b) in a case where the lender provides the borrower with, or with a copy of, an energy efficiency report complying with paragraph 5 prepared not less than 12 months before the day on which it is provided, that day,
    3. (c) the day on which the borrower ceases to own any interest in the dwelling,
    4. (d) the death of the borrower, or
    5. (e) the day on which any proceedings under this paragraph are first determined by a court or by the award of an arbitrator.
  22. 7. In this Schedule—
  23. 8.—(1) Paragraph 5 and this paragraph shall come into force on the day on which regulations made under section 7( ) take effect.

Mr. Loughton

At long last, we reach the part of the Bill that deals with the seller's pack. There has been great cross-party consensus on the matter, although not unanimity. Some progress has been made. The Committee as a whole—including the Minister for Housing and Planning—supported the proposals regarding energy efficiency. We discovered that the right hon. Gentleman had been a member of the Environment Select Committee and that, long before this Bill came along, he had endorsed the idea of energy efficiency ratings for buildings.

It was all the more strange, therefore, that the Minister was unable to support the points made by Labour Members about energy efficiency on Second Reading and in Committee. However, at this late stage, two Government amendments have mysteriously appeared, and they are very welcome. There is room in the heaven that is the Homes Bill for every sinner who truly repenteth. We congratulate the Government on amendments Nos. 22 and 23, which we will support, but we want the Minister to go further.

Conservative Members claim no small amount of credit for having cajoled, bullied and pushed the Minister to come up with these last-minute amendments. We are therefore reintroducing new schedule 1. To make it easy for the Government to accept that, we are also proposing the multiple options presented by new clauses 1 and 14.

The subject of energy efficiency was the source of great debate in Committee, and it has a long pedigree in the House. The energy efficiency measures that we propose had their origins in the 1980s, when my noble Friend Lord Walker of Worcester was Secretary of State for Energy.

Mr. Michael Fallon (Sevenoaks)

My hon. Friend referred to the multiple options presented by new clauses 1 and 14. However, new clause 1 deals with social security. Did my hon. Friend intend to refer to new clause 13? Will he later explain the consistency between new clauses 13 and 14?

Mr. Loughton

I am not sure whether I misspoke, or whether my hon. Friend misheard me. However, I am dealing with new clauses 13 and 14. New clause 1 does not feature in this group of amendments. I will explain why we are proposing two slightly similar new clauses contingent on new schedule 1.

7.45 pm

The pedigree of energy efficiency goes back to a private Member's Bill first introduced by my hon. Friend the Member for South Suffolk (Mr. Yeo). The subject was then taken up in this Parliament by the hon. Members for Eltham (Mr. Efford) and for Torridge and West Devon (Mr. Burnett). The subject has a cross-party pedigree, although there are one or two exceptions among hon. Members.

Mr. Eric Forth (Bromley and Chislehurst)

Thank you.

Mr. Loughton

It is also slightly mysterious that, although Conservative Members were happy to put our names to new schedule 1 in Committee, when it was tabled by Liberal Democrat Members, Liberal Democrat Members have not seen fit to add theirs to the new schedule 1 under consideration today.

New schedule 1 is supported by many people—by the Council of Mortgage Lenders, the Association for the Conservation of Energy and other groups concerned with energy efficiency, and by the many hon. Members who have signed early-day motions on the subject. In his written answer to the hon. Member for Plymouth, Sutton (Mrs. Gilroy) on 21 December, the Minister made it clear that he supported the proposal.

The proposal in new schedule 1 is also a hot favourite in Denmark, a country to which the Minister alluded several times on Second Reading. Denmark was held up time and again as the place where the seller's pack is an enormous success. I have been there with the Select Committee on Environmental Audit, and have seen that some success has been achieved with the energy rating of buildings. It has led to a reduction in carbon emissions as part of Denmark's Kyoto targets.

In his written answer, the Minister told the hon. Member for Plymouth, Sutton: It is currently intended that Regulations prescribe the inclusion of an energy report in the seller's pack, and that this will include generic advice on measures to improve energy efficiency, and an indication of the cost and pay back period of each of those improvements."—[Official Report, 21 December 2000; Vol. 360, c. 313W.] We have not quite got that, and such provisions did not exist in the Bill when we considered it in Committee. However, the two Government amendments in the group are a start in that direction.

Mr. Raynsford

Will the hon. Gentleman accept that I gave a clear and categoric assurance, in the House and in Committee, that an energy efficiency report along the lines that he has set out—including indications of how energy efficiency could be improved and the pay-back period—would be part of the home condition report? That has always been the Government's intention. It was part of the trial in Bristol, and there has been no change. We are absolutely committed to the proposal, and the amendments simply give effect to a policy intention that has been clearly stated.

Mr. Loughton

There was no promise to include the proposal in the Bill. In Standing Committee, the Minister was asked to do so, and he replied that the matter was extremely complex, involving strong differences of opinion among technical experts, including those involved in house construction and renovation. He said that there was a potential conflict with other building regulations, not least those on noise transmission between properties. He added that those facts were matters of concern, and that it would be inappropriate to proceed over-hastily with measures that might have both desirable and undesirable consequences. The definition of "over-hastily" in the Minister's lexicon would appear to be "less than three weeks".

Mr. Raynsford

I hope that the hon. Gentleman will accept that the comments that he has read out referred to a quite different debate. We were discussing the reasons for the delay in issuing part L of the building regulations, which are to do with energy efficiency, and I was explaining the interrelationship between those and the part that deals with the sound separation between buildings. The issuing of building regulations is very different from the provision of a home energy efficiency report in the seller's pack. There is a distinction between the two, and I hope that now that the hon. Gentleman has checked Hansard, he will recognise that he was wrong.

Mr. Loughton

My recollection of the debate is that the Minister was using that as an example of how he could not be rushed into producing energy efficiency measures. That said, we now have them—just under three weeks after the hon. Gentleman led us to believe that we would not have them—and we welcome that. We welcome the fact that the Bill refers to energy efficiency and that it will be a desirable part of a seller's pack, if we are to have such packs.

Because of the Government's amendments, we did not wish to appear churlish by tabling again amendments that we originally tabled in Committee. They added greater detail to what was required of the energy efficiency part of the seller's pack. We hope that the Minister can assure us that these matters will be covered. For example, will the energy efficiency rating for buildings—be it a standard assessment procedure rating—have more detail about comparisons with other buildings? What will the energy saving advice entail? Will it simply be slight and generic advice? Those are key questions, bearing in mind the fact that most authorities have estimated that proper energy saving advice can save an average of £250 per annum for the sort of buildings at which it would be directed. What about advice on the costs and pay-back periods for the improvements? The Minister said that energy efficiency reports were included in the Bristol pilot, although we have received no details. We would like to know how meaningful the information gleaned was.

We realise the problem with many old buildings in particular, but if the Government are determined to proceed with the seller's pack involving surveys, the best place and time to do it is at the point of sale where the cost would, we hope, be relatively minimal. After all, this is not rocket science. Energy ratings for white electrical appliances, which we discussed in Committee, have been used increasingly for some years. To achieve our Kyoto targets is a key commitment of the Government, and we support it. However, we take issue with the means by which they are seeking to do it and with measures such as the energy tax, which they seem to be using to achieve those targets. We are talking about cavity wall insulation, condensing boilers, loft insulation, the efficiency—or otherwise—of lights and heating, double glazing, damp, and so on.

Previous Government schemes such as the energy efficiency standards of performance, run by the Office of Gas and Electricity Markets, have put the structures in place, obliging public suppliers to achieve energy savings. There is a wealth of expertise and advice on the subject. Therefore it is easy to put these measures into effect, and to do so relatively soon. It is also essential to the economic sustainability of people buying homes that they can afford to finance those homes, and one of the key components of expenditure each year is on energy.

All that will take time. We are promised that it will take until 2003, at the very soonest, for the seller's packs to come in. There is no reason for not doing something in the interim—hence, new schedule 1 and the two new clauses that we have tabled. The mortgage companies can institute the proposals, which have the support of the Council of Mortgage Lenders, in fairly sharp order.

I want to touch on some of the Government's previous arguments. They said that the scheme would not cover all house sales, only those with a mortgage where the lender required a survey. That is a ridiculous argument. It is a matter of fact, not argument, that before the seller's pack comes into force, hundreds of thousands of people will buy homes and pay for a mortgage survey or will be required to have a mortgage valuation on the property, yet they will receive no advice on how to save money on fuel bills.

We have discussed how about 1.5 million properties a year are sold—more than 1 million with a mortgage to back them up. By 2003, more than 3 million properties will have changed hands. The savings on energy that could be encouraged in those properties from day one rather than day 700 is considerable.

The Government also argue that it would be costly to implement the measures for a short period before the introduction of the seller's pack and that there would be training problems for the surveyors. We have taken issue with training with regard to the survey reports required in the seller's pack, although we agree that the energy efficiency requirements are relatively straightforward and that people can put them into effect sooner rather than later.

The Government's arguments are mistaken. In Committee, the Minister described two separate training and accreditation schemes running in parallel as "a nightmare". However, it would be an unnecessary nightmare, as the energy efficiency advice given as part of the buyer's survey could be identical to that which would eventually be required in the seller's pack. The same surveyors would do both jobs and would not need training twice.

The Government also argued that there would be implementation problems for mortgage companies, which would need to set up systems to check that their duties were being fulfilled. That is hardly onerous. Mortgage companies already have very sophisticated systems and there are many providers, thanks to the deregulation of the market for which the previous Government were responsible. Mortgage companies check the survey valuations or valuation on the mortgage and would merely have to ascertain that energy efficiency advice was included, as well as checking the value that the surveyor had placed on the property. So the Government's reasons for not accepting schedule 1 do not hold water and, as I have said, 1.5 million properties a year are involved.

It is with great optimism and hope that we table new schedule 1 again. On the point made by my hon. Friend the Member for Sevenoaks (Mr. Fallon), we are giving the Government two options to make it easier for them, and are prepared to take whatever action the Government choose to facilitate the inclusion of new schedule 1 in the Bill.

If the Minister is true to his principles about the desirability of energy efficiency reports, he will have no problem in accepting new clause 13. It facilitates new schedule 1 by stating that the Secretary of State shall by regulations bring the schedule into effect within 12 months of the passing of the Act. No ifs, no buts—let us go for it.

I know that the Minister agrees with that. I know that, in principle, he has done things that would make it difficult for him not to accept new clause 13. However, just in case he is getting cold feet—in case the pressures from civil servants, other colleagues or Back Benchers are getting the better of him—we have provided a multiple choice, in the form of new clause 14, which makes it a little bit easier. It says: The Secretary of State may— not shall— by regulations bring Schedule (Energy efficiency reports) into effect within twelve months of the passing of this Act if in his judgement it would assist, or provide information relevant to, the marketing of residential properties in England and Wales. That fudges things a bit, but the Government like to do that on issues on which they have to forsake previous principles because this is the hard and fast aspect of Government and legislation.

We are offering the Government an easy ride and a simple choice. Like the vast majority of Members on both sides of the House, we are keen to see energy efficiency moved up a speed. This is the obvious time to do it. We are keen that the Government should come fully on board. They have done so with two small amendments. I am glad that they have tabled them now. They could have done so earlier, but we realise that the Minister had one hand tied behind his back. Will he put his money where his mouth has been for many years by saying yes to new schedule 1 and adopting whichever new clause he feels more comfortable, or perhaps less uncomfortable, with in order to facilitate it? The vast majority of hon. Members, especially on the Labour Benches, will certainly congratulate him and praise him to the rafters for having had the courage to do so.

8 pm

Mr. Don Foster

I rise to give full support to Government amendments Nos. 22 and 23. I suspect that there is no need to go into the detail of the amendments. I am sure that we will shortly hear a detailed exposition of them from the Minister. I hope that he will point out the remarkable similarities between amendments Nos. 22 and 23 and amendments that my hon. Friend the Member for Carshalton and Wallington (Mr. Brake) and I tabled in Committee.

I remind the Minister that in Committee he said not only that such amendments were unnecessary but that they could be positively dangerous because they could preclude information relating to other matters such as noise or disabled access. I am delighted that he has seen the light and is willing to change his views. He can be assured of our full support for the two amendments.

The hon. Member for East Worthing and Shoreham (Mr. Loughton) can be assured of our support for new schedule 1 and either new clause 13 or new clause 14—whichever the Minister chooses. He asked why we had not seen fit to put our names to the new clauses and the new schedule. They are rather like a baton in a relay race passed on from one group to another. I am sure that the hon. Gentleman will have the grace to admit that his new schedule is identical to the one that I tabled in Committee.

However, even I am honest enough to admit that I was not its originator. The originator could be said to be the hon. Member for Eltham (Mr. Efford), but if he was honest he would admit that he was not the originator either. He got the idea from my hon. Friend the Member for Torridge and West Devon (Mr. Burnett). Even my hon. Friend would be willing to admit that he was not the originator—the new schedule went back as far as the hon. Member for South Suffolk (Mr. Yeo).

The ideas in the new schedule and new clauses are not new. They have been supported by hon. Members of all parties, and rightly so because they touch on important issues. I am sure that the Minister supports their principle. I suspect that his reason for not accepting them will be the same as the one that he gave in Committee—that he will include energy efficiency reports in the seller's packs, which will come into force relatively quickly, and that there is no need for an interim measure.

I hope that the Minister will reflect again. All the evidence is that, however keen the Minister is to introduce seller's packs—if they are accepted by both Houses of Parliament—the chances are that it will be a long time before they are fully implemented. The evidence is clear to see. His attempt to introduce the energy efficiency aspect of building regulations has been agreed for only 18 months, yet we know that it has already slipped by a further 18 months. I suspect that the same fate will befall the seller's packs. That is why it is important not only to accept amendments Nos. 22 and 23 but to introduce an interim measure, as proposed in the new schedule. I hope that the Minister will be prepared to consider it.

Even if new schedule 1 is defeated today, many Members of the other place are keenly interested in it and have tabled amendments in the same vein, and they will start all over again. The Minister could save a great deal of time and debate by simply accepting the new schedule.

Mr. Fallon

I am puzzled by the new clauses and new schedule tabled in the name of the Opposition. I assumed that they were some means of lightening the burden of the proposed seller's packs, but after my hon. Friend the Member for East Worthing and Shoreham (Mr. Loughton) had spoken I realised that they added to the seller's packs. As I said in my intervention, I am a little confused about the consistency between new clauses 13 and 14 and new schedule 1. I understand that new clause 13 requires the Secretary of State to bring the schedule into effect within twelve months of the passing of this Act. That seems a little odd.

Either we believe in this energy efficiency gimmick, or we do not. Why we should wait 12 months to bring it into force, I am not clear. New clause 13 is not compatible with new clause 14. New clause 14 seems to suspend judgment on whether energy efficiency reports are necessary and simply suggests that we do not really know, but that we are prepared to trust the judgment of the Secretary of State. That is an extraordinary way in which to legislate. Either we as a party believe that energy efficiency reports are necessary, or we do not.

Mr. Forth

indicated dissent.

Mr. Fallon

My right hon. Friend indicates that he does not. I happen to share that view, but we cannot say credibly as an Opposition that we are not sure and that we will leave it all up to the Secretary of State to decide. Neither new clause 13 nor new clause 14, in the multiple choice that my hon. Friend the Member for East Worthing and Shoreham is offering the Government, stands up.

Mr. Loughton

I thought that I had made it clear that we are offering a multiple choice because there is a long history of frustration of the legislation; we want to make it easier for the Government to adopt something. Even in a weakened form, that is better than nothing. That is the view that we have taken. We are in favour of the Bill and, rather than reject the whole lot, we have tried to make it as easy as possible for the Government to accept something.

Mr. Fallon

I am no clearer. Either we are in favour of energy efficiency reports or we are not. If we are, we should surely add them to the seller's packs. I am not in favour of doing so, because I am not in favour of seller's packs. My hon. Friends might disagree with me. They might have come round to the idea that seller's packs are a wonderful thing. I have never been convinced about seller's packs, and I certainly do not want to add to them, but even if I did want to add to them, I would like to think that I was clear whether I wanted to or not. It seems perverse simply to leave it to the judgment of the Secretary of State.

Mr. Bercow

I am listening with interest to my hon. Friend's explanation of the position as he sees it. Is it his understanding that the regulations would be subject to the affirmative procedure or simply nodded through the House?

Mr. Fallon

I am not clear any more about the difference between the negative and affirmative procedures. It seems to me that the House does not have a handle on either procedure any more. I deeply deplore that. If we are to table amendments, we ought to be clear whether we are in favour of them; simply to leave their implementation to a future Secretary of State seems to be fudging the issue.

Three pages of legislation are proposed in new schedule 1. I have some difficulty with the proposals. First, there is the problem of definitions. The definition of energy efficiency is not clear; it is to be construed under paragraph 1. I have searched that paragraph high and low, but I can find no specific definition of the words "energy efficiency report". If we are to put three pages of legislation on to the statute book, thereby imposing a new burden on every seller of a house, we should be a little clearer about what an energy efficiency report is.

Perhaps my hon. Friend the Member for East Worthing and Shoreham can tell us. Perhaps he has news from Denmark about what an energy efficiency report comprises. He will have seen that his new schedule states, in paragraph 7, that 'energy efficiency report' shall be construed in accordance with paragraph 1". I cannot find any definition of those words in paragraph 1. When my hon. Friend the Member for East Worthing and Shoreham winds up the debate, perhaps he will assist me. Perhaps there is some definition by reference to another statute, but I cannot find it.

What I can find, however, is a series of definitions of matters that I had not previously realised related to energy efficiency. There are definitions of half-blood relationships, of the likely expected life of the qualifying measures and of relevant periods. I am not at all clear what the definition of half-blood relationships has to do with energy efficiency reports. If we must legislate on who should be bound to carry out energy efficiency reports, why must we define in paragraph 4(3)(c) that the stepchild of a person shall be treated as his child."? I am not clear what that has to do with the definition of energy efficiency or the improvement of the housing market.

I have some difficulty with the way in which the new schedule has been constructed. I am at a loss to understand the definitions of various terms in it.

My second difficulty is the catalogue of supporters of the proposal read out by my hon. Friend. In essence, they are lobby groups. There is nothing wrong with lobbying for particular measures, but we should ask why this measure has been frustrated for so long. It is an extremely specialist measure for which some highly specialist lobby groups have campaigned for a long time. I am not at all convinced that it is the role of Opposition Front Benchers to pander to such groups without considering the overall effect—the cost and the additional bureaucracy. After all, that is probably why, when we were in government, our Secretary of State did not introduce such provisions.

The third of my hon. Friend's arguments with which I have some difficulty is his statement that such provisions have been implemented in Denmark. I am not sure that that offers a persuasive argument for any piece of legislation being presented to the House. Indeed, one might be tempted to ask why these provisions apply only in Denmark and why they have not been implemented in the major European states or in other European countries. I am not sure that we should adopt this proposal simply because it has been done in Denmark. Some things might be done in Denmark of which I do not particularly approve. On the other hand, some things might be done in Denmark whose introduction in this country I should welcome. However, it is not transparently obvious to me that we should support the new schedule simply because "it is done in Denmark". I hope that when my hon. Friend tries to sum up this somewhat miserable new schedule he can do better than that.

Fourthly, I am not clear about my hon. Friend's central argument: that if we do not like seller's packs, we can somehow make them better by adding to them. Surely, if the Opposition do not like them, we should do our best to minimise the bureaucracy and cost involved and to make the packs as simple as possible, better to aid the functioning and transparency of the housing market.

8.15 pm
Mr. Simon Thomas (Ceredigion)

I appreciate the hon. Gentleman's point on seller's packs. Does he agree, however, that if we are to have them in the mortgage and house-purchase business, they should at least be useful to property buyers? The amendments proposed by his hon. Friend the Member for East Worthing and Shoreham (Mr. Loughton) would at least provide useful information for property purchasers.

Mr. Fallon

That is a perfectly reasonable point, although I am becoming more and more suspicious of an amendment advanced by my own Front-Bench team that seems to attract support from every party but my own. That does not necessarily distinguish the proposals.

The hon. Gentleman's thesis is probably right. If seller's packs are to be foisted on us, let us make them as sensible as possible, but I am not convinced that we would do that by adding to the requirements. On the contrary, it would be perfectly possible to simplify some of the ideas for seller's packs. I am a bit surprised that my hon. Friends on the Front Bench have not proposed a series of amendments that would reduce the bureaucracy involved.

I have made my position clear. I do not believe that the case for seller's packs has been established, but if we are to have them, I do not want them to be added to. I certainly do not want them to be added to by my hon. Friends on the Front Bench.

Fifthly, I think that my hon. Friend the Member for East Worthing and Shoreham said that the measure was supported by the Council of Mortgage Lenders. That raises the rather important point that if mortgage lenders think that a seller's pack is an essential feature of house buying, it is perfectly possible for them to require it. It is perfectly possible for the House to enable them to make that requirement by ensuring that, if they want to lay down various conditions for a mortgage, a seller's pack could be one of them. However, why that should involve any of the parties in the House making additions to the statute book simply escapes me. If mortgage lenders think that a seller's pack should be a key feature of the loan that they advance, they already have it in their power to make such a requirement or, indeed, the production of any other report, a condition of their lending—as I hope that the Minister for Housing and Planning will confirm.

None of those arguments justifies the case for adding to legislation. I point out to my hon. Friend that there is a further consideration. Over the next few weeks, I understand that we shall argue that, as a party, we stand for the reduction of bureaucratic requirements—for making it easier for markets to function and for reducing compliance costs. We cannot have our cake and eat it. If we say that we stand for less interference, less government—for not fussing around, requiring people to produce reports—we cannot, in the same breath, produce three pages of laborious detail, including a definition of a half-blood child in the compilation of an energy efficiency report, and expect to be taken seriously as advocates of less government.

I urge my hon. Friend to think again.

Mr. Simon Thomas

Thank you, Mr. Deputy Speaker, for giving me the opportunity to take part in the debate. I shall now destroy the career of my fellow member of the Select Committee on Environmental Audit, the hon. Member for East Worthing and Shoreham (Mr. Loughton), by speaking in support of his amendments, but I shall also welcome the Government amendments.

As I said when I intervened on the hon. Member for Sevenoaks (Mr. Fallon), if we are to have seller's packs and go ahead with this somewhat cumbersome process, let us make them useful for the purchaser and the seller of property and for the mortgage lender, and let them contain information that can be useful to them in deciding what properties they will buy, what work needs to be done on the properties and how much to pay for them. That is a key question, which needs to be addressed here.

As the hon. Member for Sevenoaks said, mortgage lenders could require energy efficiency reports now, just as they require surveys—I am not aware of any legislation that provides that people must have a survey on their home before taking out a mortgage on it, but lenders insist on that—but they have not done so. The requirement needs to be embodied in legislation, because there are wider Government objectives—energy efficiency, reaching our Kyoto targets and ensuring good housing stock—that could be addressed if the requirement was on the face of the Bill. Although I accept that it could be achieved by permissive legislation, it would be far better if we included provision in the Bill, so that mortgage lenders, purchasers and sellers would all work from the presumption that one should know the energy efficiency of the property that one is considering purchasing.

I should like all properties—especially new homes, which are easy to assess for energy efficiency—to display something similar to the fridge sticker, enabling purchasers to know straight away how much energy they consume, how much it is likely to cost to run them and how much might need to spent to make them energy-efficient. Enacting such a requirement could be a huge step towards achieving some of the Kyoto targets and improved energy efficiency in this country.

Most home energy-efficiency measures are relatively cheap. Cavity wall and loft insulation are quite cheap to install. Even condensing boilers are relatively cheap and grants are available for them. Vendors, knowing that their homes would be assessed for energy efficiency, might choose to spend £500 or £600 on home improvements and improved energy efficiency instead of buying a new item of white goods, which would enable them to tell prospective purchasers that the house would save money and energy in the long term. That would contribute to people's increasing awareness when they buy large items such as cars—and homes, these days—of the impact of their spending on the environment.

The Minister should be congratulated on at least moving at this late stage and agreeing to include energy efficiency on the face of the Bill. Will he tell us what details emerged from the experiment in Bristol and what details can be included in such a report, because new schedule 1 has been criticised for not setting out what the energy efficiency report may cover? That might be a fair criticism at one level, but no one in this country, other than in the experiments in Bristol, has tried to compile an energy efficiency report, so we need at least an idea of what one might cover.

If the Minister rejects new schedule 1, I should like him to tell us what else the Government are likely to propose. I take it that the Minister will produce regulations, so it is important that the House be given an inkling of what might be in them. As has been said, such regulations are likely to flow through the House and we shall not get an opportunity to view them or scrutinise them.

What consultation will the Minister undertake with the National Assembly for Wales on the regulations? I am afraid that the right hon. Member for Bromley and Chislehurst (Mr. Forth) is incorrect. I believe that under part I the Minister will be forced to consult the National Assembly.

Mr. Raynsford

We are already doing so.

Mr. Thomas

That is good.

It is a well-known fact that housing conditions in Wales are worse than those in England, although there are regional disparities in England. Is there a way of using the energy efficiency reports from the purchase and sale of homes to supplement the information in home condition surveys?

At the moment, home condition surveys are carried out all too irregularly. We have not had one in Wales for more than 10 years. Therefore, much of the housing expenditure in Wales is based on inaccurate statistics, so money might be wasted. Would the format of the energy efficiency reports under the regulations be useful in developing the statistical information on the condition of homes?

We should either accept Government amendments Nos. 22 and 23—which represent the minimum—or consider the imperfect but considerable virtues of the Conservative party's proposals. The hon. Member for East Worthing and Shoreham made it clear why we should go down this route. It would be hugely beneficial not only to those purchasing properties, but to the Government's thinking on how they will achieve their joined-up Kyoto and environmental improvement targets. I hope therefore that energy efficiency reports will be included in the seller's packs, irrespective of their final format.

Mr. Forth

I share the bewilderment of my hon. Friend the Member for Sevenoaks (Mr. Fallon), because I am proud to be a member of a party that espouses the principles of non-interventionism, anti-regulation and opposition to the nanny state. I thought that that was my party's position on such matters. I thought that we were also opposed to old-style patronising paternalism, in which it was assumed that people were generally so cretinous that they required legislation to protect their interests.

I thought that new schedule 1 contained a printing error—apparently, some of my hon. Friends were its authors. I thought that that could not be so because my party espouses the principles of deregulation and the free market and does not patronise individuals, but it seems to have produced three pages of garbage. I thought that that was a mistake until I heard Conservative Front Benchers say that they were the measure's authors and allege that the party supported it. I shall take new schedule 1 at face value and spend a little time examining it to find out whether it is deregulatory and non-interventionist, whether it measures up to the principles that we espouse and whether it will benefit our society.

Mr. Raynsford

Perhaps I can shortcircuit this debate and make time available for the other amendments that hon. Members are keen to debate by making it clear that the Government have the greatest reservations about new schedule 1. We do not intend to support it and, therefore, the right hon. Gentleman need not fear that it will become part of the Bill. If that helps to overcome the slight difficulty in the Conservative party and allows us to move on to other matters, I hope that the House will have been done a service.

Mr. Forth

I am pleased that my limited eloquence has already persuaded the Minister of the position to take on new schedule 1, but I want to carry some more of my hon. Friends with me if I can. So despite the Minister's blandishments, I shall take just a few more minutes to deal with some of the measures in new schedule 1, on which, happily, the Minister and I share a view.

I welcome him to the world of deregulation and non-intervention, in which we honour the good common sense of the people of this country and assume that they know what is best for them, and do not need the nanny state to guide them.

Under the proposals, we would interfere in the long-standing relationship between lenders and borrowers, and between the buyers and sellers of property. We would somehow attempt to tell people what it was in their interests to judge when considering a property transaction. The assumption is that something called a report on energy efficiency would add to that process. I am not sure how many people think about an amorphous concept such as energy efficiency when considering the sale or purchase of a house. As my hon. Friend the Member for Sevenoaks said, the concept is defined nowhere in new schedule 1, and is therefore of only limited use, if any.

I am not sure whether people should take much account of something called energy efficiency when considering the location of a property, or its accommodation, garden, garage, or whatever. They may choose to take account of that, but they may deliberately set it to one side. However, the new schedule would not only make it mandatory for the new process to be interposed in the normal transaction, but its inevitable additional cost would be added arbitrarily, without any choice, to what until now has been a freely undertaken transaction between buyers and sellers.

8.30 pm

That disturbs me at a number of levels. It disturbs me because of the assumption that we in this place—and the lobby groups to whom my hon. Friend the Member for Sevenoaks referred—know better than the 1.5 million people who undertake such transactions in this country every year. That assumption is, at the very least, worth querying or challenging.

Mr. Bercow

For the avoidance of doubt, will my right hon. Friend confirm that, even if he were persuaded that energy efficiency reports were on the whole germane as a factor in the purchase price of properties, he would not think that they should be obligatory on that account?

Mr. Forth

That is right. We have been told that the Council of Mortgage Lenders is very keen on all this. I do not understand that because—following what my hon. Friend the Member for Sevenoaks said—if mortgage lenders were as keen as is alleged, they would already make it a condition of loans that something called an energy efficiency report be carried out as part of the transactions that now take place. Why these excellent people do not do that now, yet say that they would like it to be imposed by statute or by regulation, is a question that only they can answer. I cannot answer it for them. I am puzzled by their approach, because it suggests a duality of attitude—I shall put it no more strongly—that requires an explanation.

Paragraph 1(3) of the new schedule states: The lender may, in fixing the amount of any fee to be charged for a qualifying survey, take into account any additional costs reasonably incurred in preparing the energy efficiency report". The trouble is that it appears that even if the buyer and the seller were mutually to decide, for whatever reason, that they did not want an energy efficiency report, they would be obliged to meet the fee set by the lender in accordance with that sub-paragraph.

That strikes me as unreasonable. Surely if adult citizens who wish to undertake a purchase or sale mutually agree that it is not in their interests, or not part of their requirement, to undertake this extra cost, they should be free to make that decision. I find the mandatory element of the provision—not to say the assumption that people cannot make their own judgment about how far something known as an energy efficiency report will be germane or relevant to the transaction—utterly offensive.

The new schedule gets worse than that. In an attempt to answer the question that my hon. Friend the Member for Sevenoaks so sensibly posed, I draw the House's attention to paragraph 1(4), which attempts to be helpful. It says: In sub-paragraph (1) a 'qualifying survey', in relation to a dwelling, means any survey or valuation which includes a physical inspection of both the exterior and the interior of the dwelling. That raises a question that runs all through the schedule. If the report is to be a cheap, cheerful and easy estimate of energy efficiency, I doubt its value. If it is to be of real value, I suspect that it should properly be detailed, comprehensive, lengthy and probably fairly costly.

The whole concept falls at the very first hurdle. If those who support it argue that it would not cost anybody much more, and would not be long or burdensome, I suspect, as a layman, that it would probably not be of much value. Conversely, if an energy efficiency survey were to be of use to the buyer or seller of the property, I would have thought that, in all reason, it would have to be an expert, detailed, lengthy and necessarily fairly expensive business. That suggests a parallel with the surveys that are either for valuation purposes only or for structural purposes.

Mr. Stephen Pound (Ealing, North)

I am trying to grasp the contours of the anarchic landscape that the right hon. Gentleman portrays so eloquently. I am sure that he knows that gas safety and electricity safety certificates must be provided for properties. Does he believe that there is no room for assessing safety factors when selling or renting out a property?

Mr. Forth

That would be my starting point. I would have to be persuaded on a case-by-case basis. I enjoyed lunch with the hon. Gentleman today, and it is good to see him back in the Chamber, albeit not in his usual place. However, he tries to suggest a symmetry between safety and energy efficiency. The two factors are different. Safety is important, and we can legitimately argue, case by case, about whether regulations should try to guarantee it. We cannot make the same argument for alleged or real energy efficiency. I do not accept the hon. Gentleman's parallel.

We are obliged to plough through the new schedule, because that is what Report stage is all about. It gets hopelessly bogged down. I make the point to illustrate the horror of what we are attempting to do, and of what my hon. Friends believe will add to the general joy of life. Paragraph 4(1) states: The duty in paragraph 1 that of undertaking a survey or assessment— does not arise where … the lender is a member of the borrower's family". I suppose that that shows some flexibility. We are relieved of the burdensome requirement if we make a transaction with someone else in the family.

Paragraph 4(2) states: For the purposes of sub-paragraph (1) a person is a member of another's family if"— and it lists spouses and people living together as husband and wife. It does not refer to "partners"; at least we have not gone that far. I suppose that I should be grateful that the new schedule talks about good old husbands and wives. I am surprised that no one has tabled an amendment to try to make it more inclusive. My hon. Friends have fallen down badly on that; there are no gender or ethnicity points here.

The new schedule goes on to list: parent, grandparent, child, grandchild, brother, sister, uncle, aunt, nephew or niece. It is becoming more inclusive. It continues: a relationship by marriage shall be treated as a relationship by blood". I shall not go into all that in detail; it is becoming gruesome. However, for the avoidance of all doubt, my hon. Friends, who are trying to help those who are buying and selling houses, state in the schedule: a relationship of the half-blood shall be treated as a relationship of the whole blood". This is becoming pretty bloody. It also states: the stepchild of a person shall be treated as his child. I assume that my hon. Friends were trying to be helpful. However, the new schedule shows the reasons for the Conservative party's opposition to regulation, intervention and patronising claptrap. We get bogged down in the sort of nonsense that the new schedule represents. We start by imagining that we will help people to buy and sell houses and end by saying that a relationship of the half-blood shall be treated as a relationship of the whole blood". That is desperate stuff. The new schedule is the essence of modernist nonsense.

Mr. Crispin Blunt (Reigate)

By going through the detail of the new schedule, my right hon. Friend may have revealed a weakness, especially in paragraph 4(3)(c), which states: the stepchild of a person shall be treated as his child. If the hon. Member for Coventry, North-West (Mr. Robinson) had adopted the right hon. Member for Hartlepool (Mr. Mandelson), he would have been able to escape the provisions of the schedule when he offered him the loan for the house in Notting Hill.

Mr. Forth

How much those two were worried about energy efficiency, I shall leave to my hon. Friend's imagination. We had better pass over that fairly quickly.

I do not want to be diverted, as I am determined to get through the new schedule in the time available, so as to do full justice to it; I would not want my hon. Friends to feel short-changed. It deserves the full attention of the House, and I am trying to be helpful.

As a deregulatory, non-interventionist party—I note the identities of some of my hon. Friends in whose names the new schedule stands—we provide in paragraph 5 that the Secretary of State shall make regulations". It is in the open that the new schedule requires the making of regulations—no doubt all in the best possible spirit and with the best of motives, as such requirements usually are. However, let us be under no illusion about the purpose behind the schedule. The regulations will specify the requirements which must be met by the lender in relation to the preparation of an energy efficiency report. We still do not have the details that were asked for earlier, but at least we can understand the mandatory element. The requirement is there for all to see.

Intriguingly, paragraph 5 adds that these regulations may … require a report to include … a statement recommending measures which could be taken for the purpose of improving energy efficiency". Some doubt arises. I shall make a few comments about energy efficiency, and ask whether it is as important as is claimed in respect of taxation measures, because I do not want to be completely negative. I want to try to be helpful. I shall make some suggestions about how things could be tackled better, in the spirit of seeking to improve the life of our fellow citizens.

The provision before us simply requires a statement that recommends measures. Presumably we shall have a rather expensive analysis—if it is to be any good—of a quick, cheap and cheerful look around. It will say, "We really think that you should have cavity wall insulation or double glazing." The individual will not have to follow that advice, but he might think about it. We shall spend a great deal of money on stating why a building is not energy-efficient, only to say rather mildly, "We think that on balance it might be quite a good idea if you followed our advice."

The provision falls between two stools. Either we insist on people becoming energy-efficient or we leave them to their own devices, which would be my preference. We are as near as we shall get to what my hon. Friend the Member for Sevenoaks said that he would expect. Paragraph 5(4) states: Regulations under this paragraph may not require an energy efficiency report to contain any information in respect of the dwelling which is not readily ascertainable on a visual inspection of so much of the exterior and interior of the dwelling as is accessible without undue difficulty to the person undertaking the inspection". I suspect that that means that someone might not quite make it into the loft. He certainly will not squeeze himself into the cavities of the wall. He may not even get into the basement.

What will be the use of the provision if the requirement is for someone, even if he is relatively expert, to stroll round the building to have a quick look at it, followed by a quick stroll inside, and then make an assessment of energy efficiency? I fail to see the point. Either the process should be undertaken properly or it should not be undertaken at all. The very words of this long and complicated schedule seem to undermine its purposes at almost every turn.

The one piece of good news that I have found so far—I hope that this helps my hon. Friend the Member for East Worthing and Shoreham (Mr. Loughton)—is that sub-paragraph (7) states: In making regulations under this paragraph, the Secretary of State shall have regard to the cost of preparing an energy efficiency report. I suppose we should regard that as moderately good news, but what does it mean? Will the Secretary of State say, "If the report costs more than 25 quid to prepare, I would not do it", or will he say something else? That is the only way in which I can read the provision. If it means anything, it is that if the report is expert, comprehensive and very expensive, we probably should not have it, but if it is cheap and cheerful, that should be all right. Perhaps I am wrong. Perhaps we shall learn more about such matters in this little debate.

The bad news returns, because paragraph 6(1) states: If the borrower suffers loss by reason of the failure of the lender to comply with his duty under paragraph 1"— that is the beloved bureaucratese— the borrower is entitled to compensation". Here we go. There is a serious problem developing in this country with the blame and compensation culture, and the fact that it is encouraged and written into a new schedule—and therefore, potentially, into statute—is to be deprecated and discouraged. I should not like to see much more of that sort of thing.

8.45 pm

There is a better solution to the problem. However, I shall pose a question to those on the Government and Opposition Front Benches before giving it. The hon. Member for Ceredigion (Mr. Thomas) mentioned the Kyoto protocol, which seems to absorb many people for many of their waking hours. Not that long ago—and I say this strictly in the context of energy efficiency—it was argued that the answer to wicked vehicle emissions was to increase tax on vehicle fuel, which would reduce those emissions. At the same time, in some people's book, another argument said that domestic fuel caused even more environmental pollution than vehicle emissions. There was therefore an argument, which the previous Government accepted, for increasing tax on domestic fuel for exactly the same reason as we increased tax on vehicle fuel.

We did that, and were roundly criticised by the then Opposition, who are now the Government. The environmentalists did not quite know where to stand on the matter: some said yes and some said no. We are now in a curious position. Apparently, it is okay to tax vehicle fuel to reduce emissions—but as soon the Government got in, they reduced tax on domestic fuel. I never understood the logic behind that, and I still do not. If we are to be serious about domestic energy efficiency, there is a good old-fashioned market solution—to increase tax on domestic fuel. That approach is an alternative to the regulatory approach, and I propose it for exactly the same reasons as the environmentalists use when they argue that we should increase vehicle tax.

Dr. Iddon

Tell the pensioners.

Mr. Forth

Well, pensioners drive motor vehicles. The hon. Gentleman may not know, but pensioners have been hit hard by the "environmentally justified" swingeing tax on vehicle fuels. If he claims to be an environmentalist, how can he look the environment in the eye, having presumably supported a reduction in domestic fuel tax and, by implication, encouraged pollution by encouraging the wasteful use of domestic fuel? It goes around and it comes around in various intriguing ways.

The new schedule vaguely attempts, by regulation, to intervene in a market process—a private transaction between freely choosing buyers and sellers. It contains no detail to guarantee that it will deliver the results that it seeks. I fear that my hon. Friends may have overlooked the market solution with which, I would have thought, we were instinctively in tune. All in all, my hon. Friends have a lot more work to do to persuade me that we should support the provision; my hon. Friend the Member for Sevenoaks made a similar point.

I am aware of the passage of time and the restrictions imposed by the Government's arbitrary and unnecessary time limits on these debates—so, as it appears that the Minister and I are in broad agreement on the proposal before us, I look forward to celebrating that by listening to what he has to say.

Mr. Raynsford

I hope that I will not disappoint the right hon. Member for Bromley and Chislehurst (Mr. Forth). I shall come to the same conclusion as him, but for almost exactly opposite reasons. I hope at least to give him a little intellectual challenge.

On Second Reading and in the debate on clause 7 in Committee, I made it clear that the Government fully support the inclusion of energy efficiency information in home survey reports, and that we intend to make that information part and parcel of the seller's pack. There is an overwhelming argument for making that information available. It is when people purchase a new property that they are most likely to consider improvements and changes, and it is right that they should have information. The measure does not require them to do anything, but the information will be available to enable them to reach an informed judgment about whether it is sensible to carry out improvements to the energy efficiency of the property.

The hon. Member for Ceredigion (Mr. Thomas) asked what was included in the Bristol pilot. The energy efficiency survey covered the SAP, or standard assessment procedure, rating for the property; the potential SAP rating—that is, the amount by which the energy efficiency could be improved; the annual heating costs associated with the current SAP rating; and the CO2 emissions, for the benefit of those rightly interested in environmental concerns.

Crucially, the pilot also included advice on measures that would improve the energy efficiency of the property, including both the estimated installation cost and an indication of the energy saving, and therefore the cost saving, per year, thereby giving people information about the long-term pay-back period for investment in energy efficiency measures. That is a wholly sensible approach providing information to the public at the time when it is most useful to them in helping them reach decisions about whether to proceed to improve the energy efficiency of their home. That is the information that we intend to include as part of the proposed home condition report.

Clause 7 deals with the seller's pack. The clause gives the Secretary of State power to prescribe the contents of the pack and gives an indication of the sort of information that we believe should be included. Information concerning energy efficiency could be covered by clause 7(4). That was the point that I made in Committee, where I expressed the view that the Bill already provided for that. Because we had shown, through the Bristol pilot, our intention of including energy efficiency information in the seller's pack, there was no need to be prescriptive in the Bill.

However, to put the matter beyond doubt, we have taken note of the concerns that were expressed in the House and in Committee, not least by the hon. Member for Bath (Mr. Foster). I am delighted that he should take some of the credit. He can send another e-mail home on the subject.

Having taken note of those concerns, we decided that there should be a mention of energy efficiency in the Bill. Government amendment No. 22 specifies that the energy efficiency of a property is relevant information for inclusion in the seller's pack. Government amendment No. 23 is consequential and ensures that information on energy efficiency can be included in the home condition report. That makes it clear beyond doubt that that is intended and will happen.

Let me deal with new clauses 13 and 14. I am sorry to intrude on the private grief of the Conservative party in relation to their possible impact. New clauses 13 and 14 are modelled on the private Member's Bills tabled by my hon. Friend the Member for Eltham (Mr. Efford), which served an important purpose in raising these issues. However, time has moved on, and we have chosen to adopt a different, more comprehensive and more effective route to achieve the objective that my hon. Friend the Member for Eltham sought to achieve.

New schedule 1 is designed to place an obligation on lenders to commission an energy report when they carry out a valuation inspection for mortgage purposes. In Committee, I acknowledged that the measure could in theory enable an interim partial system to be put in place on a slightly shorter time scale than that for the introduction of the seller's pack, but I pointed out the fundamental objections to that. We believe that the seller's pack, with its comprehensive package of proposals, will provide a more appropriate route to ensuring that energy efficiency information is made available to all home buyers.

The proposed new schedule would apply only where an application for a mortgage was made and where, as a result, a survey was carried out on the property. However, we know that 25 per cent. of properties are bought without a mortgage. In those cases, the measure would bring no benefit at all. [Interruption.] The hon. Member for East Worthing and Shoreham (Mr. Loughton) asks about the other 75 per cent. He will know, because we debated the matter in Committee, that there is a growing trend among mortgage lenders to move towards desk-top valuation. He will know, because he will have studied carefully the wording of the amendment, which he will shortly have to defend, that there is no provision for the requirement to apply if there has not been a personal inspection of the property. If a desk-top valuation had been carried out, the provision would not bite. Such valuations are a growing trend among lenders and the proportion of properties that would not be covered is likely to increase.

For all those reasons, we do not believe that the measure would achieve what its promoters hope. We have no objection to energy reports being provided on a voluntary basis as part of the mortgage lending process. The hon. Members for Sevenoaks (Mr. Fallon) and for Ceredigion (Mr. Thomas) made the point that lenders could provide such reports if they wanted to, and we agree with that and would be perfectly happy for such a proposal to proceed. However, we see no justification for making such provision compulsory, since to do so would be confusing, cumbersome and unduly complicated. It would require sufficient surveyors to be trained and certified to carry out the work, because not all surveyors and valuers currently have the necessary skills to do an energy rating assessment. As that training and certifying would be going on at the same time as the training for home condition report certification, there would inevitably be two separate training and certification processes going on in parallel. That would clearly be undesirable, unduly cumbersome and bureaucratic. We are satisfied that our proposals offer the best way to achieve the objectives that the proposed new schedule seeks to achieve.

I assure the hon. Member for Sevenoaks that he is not alone in opposing the new schedule tabled by Conservative Front-Bench Members, because we shall not support it either, for the reasons that I have explained. I hope that, equally, I have assured those hon. Members concerned about energy efficiency that we are utterly committed to it and we shall achieve it by a more effective route.

On the question of the time scale, the hon. Member for Bath expressed the view that the home seller's pack process might be delayed. The one proposal that would be more likely than any other to delay its introduction would be a requirement for an interim scheme, since all the training and certification involved would delay and obfuscate the process of putting in place the necessary certification scheme for the full home condition report.

There could have been an interim of perhaps only six to nine months—the amendment that was tabled would leave it to the Secretary of State to decide the period—one year after implementation. The schedule itself allows different parts of the provision to come in at different times. No one can therefore tell exactly when it will come into effect. However, it is likely to be a matter of only a few months before the introduction of the seller's pack. Given the risk of a great deal of extra cost, confusion and bureaucracy, it would not make sense to introduce an interim scheme for that short period of time. The Government's proposal is the right way forward and I recommend it. I urge the House to reject the amendment.

Mr. Loughton

This is not an easy debate to which to respond. I am bitterly disappointed, because I have never seen such a volte face by a Minister executed by the use of the phrase, "Time has moved on." Many of the Minister's colleagues will also feel bitterly let down. The measure that he and other Labour Members supported in Committee—and which the hon. Member for Eltham (Mr. Efford) introduced in a private Member's Bill—was acceptable to him and to the majority of hon. Members. Under cover of the phrase, "Time has moved on," it has been completely cast aside.

The Minister made no attempt to respond to the points that I made, because he was still trailing the nonsense, which I thought I had pre-empted, about parallel schemes running together. He merely read out the notes that had been prepared for him before the debate, not having listened to a line of the objections that I made. The Government's mind is utterly closed on this issue and I fear that we shall get no further.

The great tragedy is that virtually none of part I has been debated on Report, yet we now have just one minute left. Bearing that in mind, I shall sit down so that we can move on to the next group of amendments. I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

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