HC Deb 11 May 2004 vol 421 cc236-55

  1. (1) In Schedule 5 to the Housing Act 1985 (c.68) (exceptions to the right to buy) paragraph 11 (single dwelling-house particularly suitable for elderly persons) is amended as follows.
  2. (2) In sub-paragraph (4)(questions arising under paragraph 11 to be determined by the Secretary of State), for "the Secretary of State" (in both places) I substitute "the appropriate tribunal or authority".
  3. (3) After sub-paragraph (5) insert—

(5A) In this paragraph "the appropriate tribunal or authority" means—

  1. (a) in relation to England, a residential property tribunal; and
  2. (b) in relation to Wales, the Secretary of State.
(5B) Section 191 of the Housing Act 2004 (appeals to Lands Tribunal) does not apply to any decision of a residential property tribunal under this paragraph.

(4) Subsections (5) and (6) apply to any application under paragraph 11(4) in respect of a dwelling-house in England which—

  1. (a) has been made to the Secretary of State before the day on which this section comes into force, and
  2. (b) has not been determined by him before that day.

(5) If the application was made more than 28 days before that day, it is to be determined by the Secretary of State as if the amendments made by this section had not come into force.

Otherwise—

  1. (a) the application is to be determined by a residential property tribunal, and
  2. (b) the Secretary of State must make all such arrangements as he considers necessary for the purpose of, or in connection with, enabling it to be so determined.'.—[Yvette Cooper.]

Brought up, and read the First time.

The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Yvette Cooper)

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: Government new clause9—Right to buy: claim terminated by demolition notice.

Government new clause 10—Landlord's notice to complete.

Government new clause 11—Right to buy: suspension by court order.

Government new clause 12—Right of assured tenant to acquire dwelling not affected by collective enfranchisement.

New clause 18—Market Plan for right to buy sales—

  1. (1)To monitor sales resulting from right to buy, local authorities will be required to formulate and publish publicly a yearly marketing plan for right to buy sales.
  2. (2) The marketing plan will include:
    1. (a) figures on the number of properties sold through the right to buy scheme in the last 12 months;
    2. (b) a target figure for the number of properties to be sold through the right to buy scheme in the coming 12 months;
    3. (c) plans for how to achieve (b).'.

Government amendments Nos. 70 and 71.

Amendment No. 116, in page 106, line 18, leave out `18', and insert '36'.

Amendment No. 117, in page 106, line 21, leave out `18', and insert '36'.

Amendment No. 94, in page 108, line 12, at end insert— `16 The Right to Buy does not apply in a rural area if the area has been exempted by regulations made by the Secretary of State.'.

Government amendments Nos. 72 to 74 and 26.

Yvette Cooper

I shall confine my remarks to the Government amendments and new clauses.

Paragraph 11 of schedule 5 to the Housing Act 1985 provides that a landlord may deny tenants the right to buy if the home is particularly suitable for occupation by elderly people. It also provides that tenants may appeal to the Secretary of State if they are denied the right to buy on those grounds. The number of such appeals has risen in recent years to more than 400 in 2003, with 20 to 25 per cent. being successful, enabling the tenants to buy their homes, usually because all the relevant factors have not been taken into account or because local circumstances have changed. To help landlords and tenants, we will shortly consult stakeholders on ways of clarifying and improving the guidance issued in 1993.

New clause 8 transfers the jurisdiction for determining appeals of this kind by tenants living in England from the Secretary of State to a residential property tribunal. That will make no substantive difference to the determination of appeals. We do not propose to change the statutory rules in paragraph 11 that determine whether a property is particularly suitable for occupation by elderly persons. Determinations by a residential property tribunal will be subject to judicial review, as are those of the Secretary of State at present. That will have the benefit of making the process more transparent and bringing together housing and related appeals and determinations under a single jurisdiction, and will over time afford opportunities for greater efficiency. The National Assembly for Wales will assess the position there independently.

On Government new clause 9 and Government amendment No. 71, there has been concern in local communities and in the House about people speculating on regeneration and demolition projects and exercising the right to buy purely to make a profit out of compulsory purchase orders, increasing the cost of regeneration and demolition schemes and also threatening their viability. Clause 158 adds to the exceptions that apply to the right to buy under schedule 5 of the Housing Act 1985 the provision that the right to buy "does not arise" where a demolition notice is in force stating that the landlord intends to demolish the property during the next 18 months. That means that no new claim for the right to buy can be made in relation to such properties. The aim is to address an existing loophole.

It has been suggested that, as worded, the clause could fail in its effect, because an advertisement placed by a landlord to the effect that he intended to demolish a building could persuade a tenant to apply for the right to buy before any demolition notice had been served. The wording in clause 158 does not make it sufficiently clear that existing claims as well as future claims should be covered. We do not want to create a mad race between people trying to get in a right to buy application and the serving of a demolition notice just to address the loophole. New clause 9 therefore makes it clear that a demolition notice properly served in accordance with the requirements of clause 158 will bring to an end any outstanding right to buy application in respect of the property in question.

We recognise that tenants may have put in right-to-buy applications at a much earlier stage in good faith, believing that they would proceed, and may incur fees and professional costs and expenses. The new clause therefore also provides for compensation to be paid in respect of any such expenditure that has been reasonably incurred in respect of a right-to-buy claim established before a demolition notice comes into force. Amendment No. 71 amends clause 158 so that a demolition notice will have to explain the right to compensation and how it may be exercised.

Government new clause 10 tackles another form of exploitation of the right to buy rules by companies and tenants. Under the Housing Act 1985, landlords may impose a timetable on tenants who are perceived to be delaying the purchase of their homes under the right-to-buy scheme. A landlord may serve a first notice to complete under section 140 of the Act, and then a second notice to complete and subsequent requirements. If the tenant does not comply with these notices, the right-to-buy application is deemed to have been withdrawn, but only after a minimum of 16 months can any sanction be imposed upon the tenant. If there are other matters outstanding—perhaps a dispute about the value of the property—it can be delayed further.

That can mean that, in a rising property market, the longer a tenant waits, the less he will pay for the property in real terms. The opposite, however, is true for the landlord, who has to sell the property at a price that is increasingly lower than its market value at the time of completion, and has to incur the expense of chasing a tenant who is delaying matters deliberately. In exceptional cases, that has allowed tenants, by reselling quickly, to make a substantial profit even after repaying some or all of their right-to-buy discount. By contrast, section 153A of the Housing Act 1985 allows a tenant to take action against a slow landlord much more swiftly. Tenants have at least 16 months to complete their purchase, while landlords face a financial penalty if they delay the process for more than one month. The new clause attempts to shift the balance so that, instead of having to wait for at least 12 months, a landlord can serve a first notice to complete after three months, if they wish. It still gives the tenant more time than the landlord, it brings the total time in line with the private sector and it addresses a loophole that people have exploited.

5 pm

Government new clause 11 gives the landlord of secure tenants a further weapon by which to tackle antisocial behaviour. In some instances, the right-to-buy scheme gives tenants who behave antisocially a means of escaping the consequences of their behaviour by purchasing their home. In such cases, the landlord cannot use the same measures over the tenant and the property, which is clearly an unintended consequence.

New clause 11 enables landlords of secure tenants to seek an order suspending the right to buy for a specified period in respect of the tenancy on the ground of antisocial behaviour. The court may grant a suspension order only if it is satisfied that the tenant or a person residing in or visiting the property has engaged in, or threatened to engage in, antisocial behaviour, and that it is reasonable to make the order. A suspension order will end any existing applications and prevent any new applications from being made during the period specified by the court, but it will not impact on the accumulation of discount.

Government amendments Nos. 72 and 73 further strengthen the measures to combat antisocial behaviour by allowing landlords not to complete a right-to-buy claim if an order to suspend it is pending. Government amendment No. 74 contains a provision similar to that in clause 167 that allows right-to-buy tenants to apply for the right to acquire or the preserved right to buy, which means that their landlords can also access the information that they require to carry out their functions under clause 166.

Government new clause 12 seeks to remedy an unintended consequence of leasehold legislation that has only just come to light. Under the Leasehold Reform, Housing and Urban Development Act 1993, qualifying tenants of flats were given rights to purchase the freehold collectively, with a mandatory leaseback to the housing association of remaining rented flats. The unintended consequence is that RSL assured tenants stand to lose their statutory right to acquire their rented home if others in a block of flats have exercised their right to enfranchisement. So far, no cases in which a tenant has lost their right to acquire their rented property have come to our attention, but the Housing Corporation notified us about the problem, and, because the change is recent and we anticipate future cases, we think it right to act now.

Mr. Clifton-Brown

New clauses 8 to 10 restrict a person's right to buy. What steps will be taken to notify people who fall within those new clauses that their rights are being restricted? The matter is clearly complicated, and, as with other legislation on the Rent Acts, I hope that any notice sent to tenants will include a bold warning stating that their rights are being restricted and that if they have any doubts about the meaning of the notice they should consult a citizens advice bureau.

Yvette Cooper

New clause 8 does not restrict the right to buy. The provisions in new clause 9 refer to demolition notices, which must explain the right to compensation. They require that accurate information be given to tenants and I reassure the hon. Gentleman that we expect appropriate information to be given to tenants in all such cases. At a later stage, I will be happy further to discuss with him exactly what kinds of information will be available for tenants under each of those clauses. As he rightly says, the matter is complex because each new clause has a different objective, and some of them for—example, new clause 12—protect the right to acquire or the right to buy.

Mr. Simon Thomas

The new clauses that relate to antisocial behaviour and the right to buy are obviously crucial to the Government's antisocial behaviour strategies. In light of the Westminster council homes scandal, can the Minister assure us that the safeguards will be sufficient to prevent disreputable local authorities from socially engineering the tenants who buy properties in particular areas? In that regard, what sort of evidence would be needed to suspend the right to buy in a court case—is it a matter of civil proof or of criminal proof?

Yvette Cooper

The hon. Gentleman is right to say that we need to prevent terrible behaviour of the kind that took place in Westminster. We are trying to safeguard the rights of local communities who are struggling with antisocial behaviour. Under the new clause, landlords will need to seek an order to suspend on the ground of antisocial behaviour, for a specified period, the right to buy in respect of the tenancy. The landlord will not be able to do that arbitrarily, but will need to go to court and the court will grant a suspension order only if it is satisfied that antisocial or threatening behaviour is taking place and that the request is reasonable. The court will need to take a series of factors into account, including whether it is desirable for the property to be managed by the landlord during the suspension period.

Some of the other amendments are about suspending the right to buy, or allowing landlords not to complete the right to buy, if other antisocial behaviour measures are already being pursued. Through the new clause, we are trying to ensure that the right to buy does not become a get-out clause that allows antisocial tenants to subvert the other measures that have been introduced to tackle antisocial behaviour. By stipulating that the decision is for the courts, not for local authorities, we have taken care to ensure that, in situations where, in effect, a tenant's property rights are at stake, a fair process is gone through in achieving our aim of dealing with antisocial behaviour.

Jim Knight (South Dorset) (Lab)

May I press my hon. Friend on the question that the hon. Member for Ceredigion (Mr. Thomas) asked about the burden of proof in such cases? Although I strongly support the idea that people who are given the right to buy must be responsible tenants and that we should suspend that right if they are being irresponsible through antisocial behaviour, I also believe that the burden of proof should be the same as it is for antisocial behaviour orders—that is, civil, not criminal.

Yvette Cooper

I can assure my hon. Friend that in such circumstances the right to buy will be suspended only for a specified period. We are not trying arbitrarily to impose an unfair penalty, but to give local authorities more tools to deal with antisocial behaviour. The new clause is very much in line with our approach towards antisocial behaviour throughout the Bill, which is to say that we need to give landlords more opportunities to address the problem while ensuring that people's rights are properly protected, that they get a fair hearing and that they are treated reasonably in the circumstances. That is why the role of the court is an important safeguard.

I turn to amendment No. 70. Under section 119 of the Housing Act 1985, a secure tenant does not qualify for the right to buy until they have spent two years as a public sector tenant. Clause 157 extends that qualifying period to five years. It has been suggested that that will disadvantage tenants who take up a new social tenancy, whether it be a secure tenancy or an assured tenancy—for example, when they move from one social housing property to another. We do not intend to penalise existing social tenants who take up new social tenancies by making them wait longer for the right to buy. This minor and technical amendment is designed to avoid such a situation arising and to ensure that tenancies that began before the day on which clause 157 comes into effect will still be subject to the present two-year qualifying period.

I ask the House to support the Government new clauses and amendments.

Mr. Hayes

We now move to the part of the Bill that deals with the right to buy, a subject that was aired in Committee and which, appropriately, we want to say a few words about today. I particularly want to speak to new clause 18, which is intended to provide a shot in the arm for the important principle of the right to buy. The whole House will be familiar with the famous words of Benjamin Disraeli, when he said that the Conservative party was only in its proper position when it represents popular principles. Then it is truly irresistible… It necessarily depends upon enlarged sympathies and noble aspirations". There can be no more noble an aspiration than the desire to own one's home and the right to buy has played an important part in the fulfilment of that aspiration since it was introduced.

In preparing for this debate, I glanced at the figures for right-to-buy sales since 1980, and I was delighted to learn that around 1.6 million properties have been sold under the scheme. None of that would have taken place without the energy and commitment of the Conservative Government who introduced that important legislation.

Ms Karen Buck (Regent's Park and Kensington, North) (Lab)

rose—

Mr. Hayes

I will give way to the hon. Lady in a moment, but before I do, perhaps I should say that, although she might be a noble exception, most of those on the Labour Benches are typically either reluctant converts to the cause of the right to buy, or nakedly hostile to it. Perhaps she will tell me which she is.

Ms Buck

I was prompted by the hon. Gentleman's statement that there is no nobler aim than that of encouraging home ownership. Will he perhaps revise that opinion and say that we should instead aspire to ensuring a decent home for all? His party's policy comes into conflict with that more noble objective in that it has never addressed the fact that the right to buy can and does conflict with the objective of providing homes for all, in high-demand areas. Will he say something about the unmet housing needs that have been created in part by the pressure from the right to buy?

Mr. Hayes

Home ownership is a noble aspiration not simply because it is a matter of acquiring a piece of property. The home is evocative of security, warmth, certainty and stability. It is the place to which we all return at the end of the day, so one should not be dismissive of the aspiration to own a home. However, the hon. Lady makes a good point when she says that it is important to have a decent social housing stock. That is why I know that she will join me in condemning this Government for their appalling record on social house building. This Government have built only about half the number of social houses that the last Conservative Government built.

The hon. Lady is also right to say that the measures in the Bill do little to address either my concerns about the pace of the right to buy or her more fundamental concerns about the principle itself. She is right that we need a balanced housing programme and that every Briton deserves the right to live in a warm, secure, stable home that is fit for its purpose and part of a strong and sustainable community. I agree with her entirely on that, but I do not believe that such aspirations are incompatible with the right-to-buy policy.

Mr. Andrew Love (Edmonton) (Lab/Co-op)

rose—

Jim Knight

rose—

Mr. Hayes

I will give way, although I do not want to be diverted down a path that you will not let me follow, Mr. Deputy Speaker. However, I am trying, as ever, to be generous to Labour Members.

Mr. Love

The hon. Gentleman did not actually answer the question put to him by my hon. Friend the Member for Regent's Park and Kensington, North (Ms Buck). Let me ask him a much simpler one: is it still the Opposition's policy to extend the right to buy to the registered social landlord sector, and what implications does he think that that would have for affordable accommodation?

5.15 pm
Mr. Hayes

I tell the hon. Member for Edmonton (Mr. Love) unequivocally that it is our intention to maintain the policy. There has been no party policy change on the right to buy, but it is important to consider other ways in which to provide high quality social housing. It is also important to create a more fluid system, whereby people move more easily from rented to market housing. One of the problems with the right to buy is that many long-standing council tenants become the long-standing owners of the properties that they purchase and do not move to market housing. That has diminished local authorities' housing stock. That was a fair point, which both the hon. Gentleman and the hon. Member for Regent's Park and Kensington, North (Ms Buck) made.

It is not beyond the wit of man to create an environment where people can aspire to ownership and in which a more fluid market can exist. The hon. Gentleman will know about the possibility of transferable discounts, which the previous Government introduced and the current Government maintain. They allow people to fulfil their aspiration to become home owners and lead to a more fluid market. We are disappointed that the Bill gives that no shot in the arm.

From memory, there were approximately 897 cases of people taking up the opportunity through a transferable discount to move from a rented to a market house in 2002. That is a miserable figure when compared with the total number of people who aspire to own their homes. Seventy per cent. currently own their homes and more than 80 per cent. would like to do so. Any responsible Government or party has a duty to ensure that those people have a realistic prospect of achieving that aspiration. Because the hon. Member for Edmonton is a caring and decent man, I know that he would agree with that. On that happy note, I give way to my hon. Friend the Member for Cotswold (Mr. Clifton-Brown).

Mr. Clifton-Brown

Will my hon. Friend explain to Labour Members who are so hostile to the right to buy why their Government preside over the highest number of homeless people in the history of this country?

Mr. Hayes

I do not want to labour the point about the Government's failure in social house building. I have mentioned it twice already and this is the third occasion. To refer to it four times would be excessive. The Minister, the Under-Secretary and the whole Front-Bench team bear the burden heavily. It must be engraved on their hearts that, as homelessness increases, their record on social house building worsens. We should move on swiftly to avoid causing any further embarrassment to Government Front-Benchers.

Jim Knight

I know that the hon. Gentleman has visited my constituency, because he wrote and told me about it when he was a spokesman on agriculture. He may remember from that visit that there is an acute shortage of affordable housing in my area, largely created by the right to buy and the inability to find anywhere in our beautiful natural environment to build any more housing. Is not the effect of the right-to-buy policy on our rural areas, where families are moving out and schools and post offices are closing, written on his heart? Schools and post offices cannot be sustained because of the lack of social and affordable housing that the Conservative party created.

Mr. Hayes

It is flattering that the hon. Gentleman remembers my visit to his constituency. I, too, remember it and I can tell him that the farmers whom I met were complimentary about him, as I was. I advised them not to vote for him and they said that, although they liked him, they did not like him enough to do that. However, they highlighted some of the challenges that faced the area. I know that he feels deeply about the availability of socia1 housing in rural communities. So do I, given the sort of seat that I represent.

The hon. Gentleman knows that the right to buy is not available to people in small rural communities. He will also know that any Government need to have a policy that is targeted at the problem that he highlights. I hope that that applies to this Government but it certainly applies to the next Conservative Government. If one builds houses for renting or affordable market houses and simply sucks people in from outside the community rather than providing houses for people who need to work or have families there, one does not solve the problem.

Squaring that wil1 be a challenge for the Opposition when we are in government. I am acutely aware of that. One method, to which I believe that the hon. Gentleman will be sympathetic, is the exceptions policy. I believe that it is under threat; perhaps the Minister will give us an assurance today that it is not. I do not want that avenue to be removed from the communities that the hon. Gentleman described.

Matthew Green

rose—

Mr. Hayes

I want to get back on stream, but it would be discourteous not to give way to a representative of the minor party before doing so.

Matthew Green

The hon. Gentleman says that the right to buy does not apply in rural areas, but he is becoming confused. When the right hon. Member for Skipton and Ripon (Mr. Curry) was a Minister, he got an exemption for the right to acquire, which is a slightly different right that is not used anything like as often as the right to buy. The right to buy still applies in rural areas. It has decimated the stock in my area just like any other.

Mr. Hayes

The hon. Gentleman will no doubt be looking carefully at the policies that we intend to introduce, which will assist areas such as his in the provision of high-quality social housing and, indeed, affordable market housing. When we do so, I know that he, in the spirit in which he always greets such things, will support us in his constituency and, I hope, elsewhere.

Back to the Bill, Mr. Deputy Speaker. You have been, if I may say so, characteristically generous in allowing a slightly broader discussion than I had perhaps originally intended. However, I wanted to be generous to Labour Members and I hope that we have been able to explore some issues of principle. Out of that has come living proof of my suggestion that Labour Members are reluctant converts to the right to buy. People who have exercised, or who hope to exercise, that right will have listened to the tone of their remarks very carefully. I do not want to be more critical than that, and I shall move on to our new clause.

There is a problem with the right to buy: although it has been a great success, there has been some tailing-off of uptake. That is a problem, as one wants everyone with the aspiration that I described to see it fulfilled. Another is abuse. In Committee, I made it clear that we have no truck with abuse of the right to buy, and it is indeed right and proper that measures be introduced to deal with it. It is not appropriate for a noble aspiration, as I described it, to be turned into a way of abusing the system for people who are behaving unscrupulously.

The Government have properly recognised that and introduced changes, some of which we welcome. However, consistent with the spirit and intention of the original right to buy legislation, it is important that we simultaneously put proper demands on local authorities that may not be carrying out their proper obligations in respect of the right to buy as enthusiastically as they might.

It is clear from a study of local authorities across the country that some drive the right to buy with enthusiasm while others are reticent in encouraging people to take it up. That can involve the speed with which they deal with inquiries, how they market their local policy and how they value their properties. The Minister will know that a study commissioned by the Office of the Deputy Prime Minister found that, in more than a third of appeals against the price of a property valued by the council in the case of a right-to-buy application, the price tag was cut by more than 10 per cent. Indeed, more than three quarters of tenants who purchased from their council under the right-to-buy scheme secured a price reduction.

There is a real problem with pricing not being accurate and that possibly being a disincentive to people who do not appeal. There will be people who see the price and think, "I can't afford that." They will turn back at that stage while those who appeal clearly get a positive result in the vast majority of cases. There is a problem with the right to buy and our new clause seeks to deal with it by proposing that local authorities be required to formulate and publish publicly a yearly marketing plan for right to buy sales. The plan would include targets on the number of properties that the authority planned to sell and how many it had sold, as well as how it would achieve that target. That seems to me a sensible, constructive and measured way to encourage local authorities to think creatively about how to deal with the right to buy. Few local authorities would think that it could not be taken on board at small cost. It would not be a massive exercise, because good local authorities are doing much of that job anyway.

Dr. Alan Whitehead (Southampton, Test) (Lab)

I am following the hon. Gentleman's argument carefully. Would not such a plan interfere with the market?

Hon. Members

Yes.

Mr. Hayes

I did not turn a deaf ear to the question. I did not hear it clearly. The truth of the matter, as the hon. Gentleman knows, is that the market is not perfect. [HON. MEMBERS: "Oh."] Let me explain, for the benefit of those Members who are under the illusion that Tories believe that the market is ever right, that that has nothing to do with authentic Tory philosophy. The Tory party, throughout its history, has understood that there needs to be a proper balance between the intervention of government and other agencies and the free market. That is not a revelation. It is the view that has inspired the party of Disraeli, Shaftesbury and Wilberforce—[Laughter.]

The hon. Member for Leeds, West (Mr. Battle) is laughing. He will know that most of the 19th-century reforms were introduced and completed by Conservative Administrations against fierce opposition from the Liberal party. In the 20th century, too, Conservative Administrations introduced many measures, including the right to buy, which aided social mobility and extended opportunity to people who would otherwise not have been able to enjoy it and recognised that government must sometimes stimulate, encourage and temper the market. There is nothing odd about that.

Indeed, one might even argue—I know that there is a certain hostility from some on the Labour Benches towards their Front Bench—that it is not the Tory party but the current leadership of the Labour party that has been seduced by the glitz and glamour of power and money. The hon. Gentleman should not therefore be so dismissive of the record—

Mr. Deputy Speaker (Sir Michael Lord)

Order. The hon. Gentleman has already thanked me for my generosity. May I tell him that it is not limitless?

Mr. Hayes

I wondered at what point your generosity, Mr. Deputy Speaker, might begin to come to an end. We have now reached that important point.

The intention of the new clause is to assist local authorities in the pursuit of a proper purpose. The Government have properly introduced a series of measures in Committee and today aim to curb the abuses of right to buy, with which we have no problem. In that spirit, I hope that they will support the new clause and so provide the balance that is absolutely necessary if the great success of the right to buy is to continue into the future.

Mr. David Drew (Stroud) (Lab/Co-op)

I want to speak to amendment No. 94, which I tabled, and to make some points as an antidote to the contribution of the hon. Gentleman who has just spoken.

I was a member of a Labour authority in the early 1980s that pre-empted the Conservative party in terms of the right to buy. The one difference was that for every council house that was sold, we built another one to replace it. That must be the only way in which a sensible right to buy can ever be afforded.

We have had a useful debate already in terms of the implications of the right to buy. In Committee, an attempt was made to consider further exemption on the right to buy where there were rural populations of less than 3,000. I make no apology for reintroducing that issue, because the Government must recognise that the problem of housing is not just an urban one but very much a rural one.

5.30 pm

Over the last five years alone, we have sold off some 40,000 council properties. That has happened at a cost. Yes, the right to buy is about giving the individual choice and the opportunity to buy the home in which he or she lives, but we also know of the damage done to others whom it prevents from living in rural areas. It is pleasing that amendment No. 94, which has been floating around for some time, is supported by both the Local Government Association and Shelter. They feel strongly that something must be done about the growing problem of not just homelessness but lack of accessibility. Our rural communities are being socially cleansed, in the sense that people on lower incomes can no longer afford to live in those areas.

Ms Buck

Does my hon. Friend agree that the hon. Member for South Holland and The Deepings (Mr. Hayes) was wrong in his analysis of the problems connected with the right to buy? My hon. Friend is right about what is happening in rural areas, and indeed in urban areas such as mine. When properties have been sold and then sold on, those in a position to buy them are in a different category in terms of purchasing power and housing need. That leaves a much larger pool of people in true housing need. Properties in my constituency that were originally sold under the right to buy are now being sold for £350,000, and are thus completely beyond the reach of people who need affordable homes.

Mr. Drew

I agree, and the problems affecting London also affect the more expensive parts of the south. On-selling often moves properties completely out of the affordable housing bracket—properties that have already been moved out of the social housing bracket.

The amendment happens to chime with a recommendation in the report produced by the rural group of Labour Members, which I am proud to chair. The report, which was well received by the Front Bench, made a number of suggestions that I feel should be pursued. We said, for instance,

The right to buy from councils or RSLs should not be available to tenants in settlements of below 3,000. They concede that this 'may cause difficulties for those who already have this right', but argue that, 'as people realise the effect of the right to buy on their own families, they will understand why it may be withdrawn'. We were quite cheered by the thought that, as the Government recognised, there were places in which—on a purely local, discretionary basis—the right to buy had reached its natural conclusion. Surprisingly, however, few of the 26 areas that were given an opportunity to consider how they might restrict the right were deemed to be rural. We want to extend the recognition that we now live in very different times.

As I have said, there is one thing worse than the removal of people's ability to buy their existing homes: the fact that they are no longer able to live in many rural areas. This is all about priorities, and about ensuring that we have a mixed rural population. That population is already under great strain in the south, and unless we do something dramatic the situation will worsen.

There are alternatives, and the Government are considering them. One option is Homebuy; another is the system of community land trusts, which I favour. We will be creative, and we will be innovative. The simple fact, however, is that such schemes take time to bring about, whereas the crisis is real and happening now. I hope that my hon. Friends on the Front Bench will consider carefully what we are suggesting. We are not saying that the right to buy should go; we in rural areas are not unreconstructed Stalinists, we are just people who deal with our constituents.

The issue is no longer one on which the Labour party stands in isolation. I gather that the Liberal Democrats moved an amendment on this point in Committee, and there are many Conservatives who are now beginning to consider a similar position because of the way in which we have seen our communities change as a result of the right to buy—and in this case, change for the worse. I should make it very clear that this is a matter that should be left, with the support of the ministerial team, to local discretion. If local authorities feel that the right to buy has a rightful place in their housing policy, then let it continue, but if they have seen the problems of right to buy and feel strongly about them, it is only right and proper that they should be included in the group of 26 existing areas where the right to buy is further restricted.

I hope that Ministers are listening and that this debate will be continued not only here but in the other place when the Bill is considered there. The issue will not go away, and I make no apology for raising it. It is crucial. Anyone who knows anything about rural Britain at the moment knows that when Labour came to power, the No. 1 issue, without any doubt, was transport. Now that that issue has been addressed—not completely, but there are some improvements in transport—it has been overtaken, unfortunately, by housing. Anyone who does any research, or talks to lower-income constituents, will without doubt identify housing as the highest priority. I hope that Ministers take note, and that we can ensure that something is done on this vital issue.

Matthew Green

I shall attempt to be brief, because I know that we want to turn to other matters, but I cannot resist making a quick comment on the Conservatives' new clause 18, which is the "pile 'em high, sell 'em cheap" clause. It is an attempt to get councils to force through right-to-buy sales, and it is quite frankly barmy. Right to buy is right in some areas, but it works to the detriment of others. The hon. Member for Stroud (Mr. Drew) said that it should be left to local discretion, and that is exactly what should be done. No amendment has been tabled that makes that point, but it should really be up to a local authority to decide whether there should be any discount up to £36,000, in any area. That would solve many of the issues with which we are dealing.

I wish to speak to amendments Nos. 116 and 117. The Government have rightly acted to prevent people from using right to buy just before a regeneration scheme or demolition goes ahead, which they know is going to happen, so that they can receive compensation money. The Government are right to take that action, but they have specified a period of 18 months. My understanding, from talking to people who work on such schemes, is that the common lead-in time from the point at which a scheme is announced to the point at which it goes ahead is much nearer to three years. There is quite a lot of concern in the industry, for want of a better word—it is not really an industry—and from people who work in the field that an 18-month period is insufficient. We have suggested a period of 36 months, which would be the three years that those people have mentioned. I ask the Minister to look closely at that time period, because the professionals who work in the field say that it is insufficient and that there will be problems as a result. The action is absolutely right, but the Government need to consider the time frame.

I firmly endorse amendment No. 94, ably moved by the hon. Member for Stroud (Mr. Drew). Right to buy has decimated the housing stock in rural areas. In my constituency, it has caused tremendous problems of loss of social housing stock that cannot be easily replaced, and I commend the hon. Gentleman for tabling the amendment. I raised that point in Committee, and I hope that the Lords will look at it in detail and that the Government will act on it.

Perhaps the best route forward is to leave to local authority discretion whether or not there is a discount. That would be a simple way of dealing with the situation, rather than the current approach of central Government's deciding which are the deserving rural areas. The centre does not always know best; in fact, it rarely knows best. The matter should be left to local discretion. That is new localism, and it is in chime with what the Office of the Deputy Prime Minister is talking about.

I hope that the Government respond positively to the amendment tabled by the hon. Member for Stroud, and I also hope that they extend the time period relating to demolition notices to 36 months.

Several hon. Members

rose—

Dr. Desmond Turner

I, too, will try to be brief, as I know that many other important new clauses follow mine. New clause 2 would give the Government enabling powers to bring in a national tenancy deposit scheme.

Hon. Members

New clause 2?

Mr. Deputy Speaker

Order.

Dr. Turner

I am sorry, Mr. Deputy Speaker, I thought that we had finished the previous group of amendments.

Mr. Deputy Speaker

We are dealing with new clause 8 and the related new clauses and amendments on the selection list. I do not know what the hon. Gentleman has chosen to speak to, but that is what we are dealing with. I call Mr. Geoffrey Clifton-Brown.

Mr. Clifton-Brown

I think I know which group of amendments we are debating. The hon. Member for Brighton, Kemptown (Dr. Turner) was anticipating a debate that is to come, and he will doubtless want to speak in it.

I intervened on the Minister earlier in respect of new clause 8 in particular. It is an eminently sensible provision which determines that houses especially suitable for elderly people should be exempt from the right to buy. We can all think of types of housing—terraced housing, bungalows, small houses and so on—that are particularly suitable for elderly people, and which should remain as such. That is fine in theory, but I am not sure that new clause 8 adequately informs those who live in houses that may or may not be so designated about what is happening to their right to buy. The Minister needs to provide more of an explanation than she provided in answer to my intervention.

When a Government fetter people's rights and take them away, they have a duty to explain to those people in simple terms what is happening to them. As with other notices in housing legislation, the information that such people will receive through the post will be complex. They should be told in no uncertain terms, through a warning on the notice, that if they are in any doubt as to what the notice means, they should consult a citizens advice bureau.

My neighbour the hon. Member for Stroud (Mr. Drew) may have tabled his amendment No. 94 under a misapprehension. If he studies the law carefully, he will discover that under right-to-buy designation orders, it is currently within the Secretary of State's power to designate rural settlements of under 3,000 as exempt from the right to acquire. I accept that his amendment deals with the right to buy, and it may well be that right-to-buy legislation should be brought into line with that relating to the right to acquire. On thinking about it as I am speaking, the designation orders to which I referred do apply to the right to buy. Perhaps the Minister will clarify that point. As such, the hon. Gentleman's amendment is unnecessary.

In any case, it is worth putting on the record some misapprehensions about the right to buy. The average period of tenancy of all public housing in London is now 20 years and growing; in other parts of the country, it is at least 10 years and growing. The number of houses either in the council house or registered social landlord sector that become available is part of the housing problem. It is so important for the Government to build more affordable housing. If they want to solve the current acute homelessness and waiting list problems, the only way is to build more social housing.

The right to acquire has very little effect indeed, because it amounts to only a small proportion of our total built housing stock. If the Government—or, indeed, a future Conservative Government—were to amend the rules on right to buy so that the proceeds, instead of going to repay borrowing, were put back into building new social housing, much more money would be available to put back into the pool to build more social houses. That is what we should be doing.

5.45 pm

I applaud the Government new clauses, particularly the provisions to deal with the scam whereby people immediately want to buy their homes when a demolition order is put in place. That loophole needed to be closed and I applaud the Government for tackling that.

I do not, however, applaud the Government's provisions for reducing discount, particularly in London. It is now becoming very difficult indeed to acquire a house in London, even with the discount that the Government currently apply. People used to apply for a discount under the right to buy in order to put down a deposit on their mortgage. Because the price of London houses is now so high, it is very difficult for anyone to use the right-to-buy provisions accordingly.

I hope that Government Members will not adopt a prehistoric socialist opposition to right to buy. As my hon. Friend the Member for South Holland and The Deepings (Mr. Hayes) said in ably opening the debate, it is the noblest ambition of all for someone to want to buy their own house.[Interruption.] One of the few ways in which people living in public sector housing are able to get on to the housing ladder is through right to buy. As my hon. Friend also said, we should be considering not only right to buy, but a whole range of imaginative schemes to help people on to the housing ladder.

I commend the Government new clauses and hope that the Government will in turn consider new clause 18 as a means of helping to speed up right to buy, which seems such anathema to Government Members. After all, if people own their own homes, it takes away their need for housing in the public sector, thereby making places available for people on the waiting list or the homeless. The current position is precarious because of the number of homeless people. I believe that opposition to right to buy will not help to solve the problem.

Yvette Cooper

I should like to respond to the various points raised in relation to this group of new clauses and amendments. It may be an appropriate tribute to the 25th anniversary of Baroness Thatcher's arrival in Downing street that the hon. Member for South Holland and The Deepings (Mr. Hayes) has abandoned her reverence for the free market and commitment to it in all circumstances. If only his party leader had been more inclined to agree with him and rather less enthusiastic about revering her legacy, the Conservatives might be doing rather better right now.

Amendments Nos. 116 and 117 express concern about demolition and regeneration. I recognise concerns in that respect, which is why we have introduced new clauses to ensure that issuing a demolition notice puts an end to existing right-to-buy claims that have al ready been submitted. We chose to make demolition notices last for 18 months in order to strike a reasonable balance and to discourage the sort of exploitation that has been mentioned. We also want to encourage local authorities and others to get on with the job so that tenants are not unfairly denied the right to buy either because the schemes are unviable or the agencies too slow in the process. Three years can be a long time to get round to demolishing a property, and for tenants to be left in uncertainty and unable to exercise the right to buy. However, the Bill already provides for the 18-month life of a demolition notice to be extended by the Secretary of State, on application by the landlord. We recognise that there will be cases in which regeneration is phased, for example, or where particular schemes take some time. In some cases, a decision may be made to demolish a series of properties in a particular order, even though it may take some time to get round to the phase of demolition that is at stake.

There is therefore flexibility in the existing provision. We will consider the matter further, but we think that the 18-month period is probably right at this stage. In view of that, I hope that the hon. Member for Ludlow (Matthew Green) will not press amendments Nos. 116 and 117.

Amendment No. 94, in the name of my hon. Friend the Member for Stroud (Mr. Drew), would allow the Secretary of State to exempt rural areas entirely from the right to buy. Secure tenants in such an area would not have a right to buy as a result. We recognise that there are pressures on affordable housing in many rural areas, and my hon. Friend set out his concerns about his area very clearly, and made clear the need for affordable housing.

Mr. Hayes

Will the Minister confirm that there is no intention to change or abandon the exceptions policy?

Yvette Cooper

We have said that we intend to continue with that policy. I assume that the hon. Gentleman means the restrictions that apply to the seven national parks, and to the 37 areas of outstanding natural beauty.

Matthew Green

The exceptions policy is used in rural areas to allow affordable houses to be built outside building envelopes. It is currently being considered under one of the new planning policy statements. I should be delighted if the Minister would confirm that she is not about to end the exceptions policy.

Yvette Cooper

I shall clarify exactly what I mean. The Bill does not change the protection in place for the seven national parks, the 37 areas of outstanding natural beauty and the 30 areas designated as rural, for this purpose, by the Secretary of State. That covers about 40 per cent. of the land area of England. Under section 157 of the Housing Act 1985, landlords may place restrictions on the resale of homes sold under the right-to-buy scheme. Landlords can choose between requiring owners either to resell only to people who have lived or worked locally for three years or, if they prefer, to offer the property back to the former landlord.

Mr. Hayes

I want to be absolutely clear about this matter. The exceptions policy is the means by which small numbers of properties in rural communities have been built outside the building line. As the hon. Member for Ludlow (Matthew Green) said, it has proved very effective in developing houses in the sort of communities described by the hon. Member for Stroud (Mr. Drew). Will the Government stick with the policy, or are they going to abandon it?

Yvette Cooper

I hope that the hon. Gentleman will allow me to complete the point about landlords in the seven national parks, as I will then come to the point that he has just raised.

Clause 162 extends the right of first refusal to all other right-to-buy landlords, wherever they are. However, it explicitly retains the current system in the national parks and in areas of outstanding natural beauty and designated rural areas. Our intention is to continue with the present system.

The hon. Member for South Holland and The Deepings asked about the broader issue of the exceptions policy. Our position has been made clear: we are sympathetic to the policy, which we consider to be important. It is subject to continuing consultation, but we hope to include it as part of a more flexible system. We will say more about the matter in due course, as I am not in a position to do so at the moment. We are aiming to achieve a more flexible approach that addresses the conflicting needs and differing pressures that arise in connection with housing issues.

Mr. Drew

I do not want to get hung up on the difference between the exceptions policy and exemptions, but I hope that my hon. Friend will take it from me that the exceptions policy does not really have anything to do with the right to buy. There is a lot of evidence in rural areas that we have got all the land that we are going to get through the exceptions policy. We need to be much more creative, and much more dramatic, when it comes to dealing with the problems of rural homelessness.

Yvette Cooper

My hon. Friend is right, and I thank him for that clarification. My earlier lack of clarity stemmed in part from the fact that the exceptions policy has to do with planning, and is not directly related to the right to buy. As I have said, the Bill retains the existing approach to right to buy in the national parks and so on.

I want to deal with the points in connection with rural areas that arise from amendment No. 94. The Government do not believe that at this stage it would be appropriate to introduce complete bans on the right to buy in certain areas, as the amendment proposes. We need to strike a balance between respecting the aspirations of social tenants in rural areas to become home owners and the need to retain social housing for local people.

The House will know that we have reduced the maximum discounts available to tenants in certain areas. That has happened already in 41 areas of London and the south-east of England that are under the greatest housing pressure. In Committee, my right hon. Friend the Minister for Housing and Planning was asked whether maximum discounts might be an alternative approach in rural areas. He said that the Government recognised that housing pressures were driving up house prices in some rural areas. There is no intention of introducing across-the-board, blanket bans, and the Government are continuing to monitor the situation. I can therefore confirm that we will keep the question of maximum discounts under review.

We are also looking at further ways to increase the supply of affordable housing. We are seeking a more flexible approach that will ensure a fair balance for existing tenants and for people who will need affordable housing in the future. I therefore hope that my hon. Friend the Member for Stroud will seek to withdraw amendment No. 94.

Finally, I want to deal with matters arising in connection with new clause 18, moved by the hon. Member for South Holland and The Deepings. By its nature, the right-to-buy scheme has always been demand led. A tenant who applies for it, who meets the qualifying criteria and whose home is not exempted, has the right to buy his home, and his landlord must sell it to him.

New clause 18 seems to want local authorities to promote and market the right to buy in a different way. It seems unlikely that qualifying tenants would be unaware of the right to buy. Section 104 of the Housing Act 1985 requires landlords to provide secure tenants with information about the provisions of the right-to-buy scheme. Also, there are an awful lot of advertisements on the telly at the moment promoting the right to buy. Various companies want to get involved with tenants as regards the right to buy, so it is surprising that the hon. Member for South Holland and The Deepings seems to suggest that people are not aware of their rights in that regard.

Mr. Hayes

I hope that the Minister will deal with the question of pricing that I raised. A report carried out by the College of Estate Management in Reading stated: The government is understood to be anxious that the findings of the report should be kept quiet for fear of prompting a rush of appeals. If properties are regularly and routinely overvalued, that must be a considerable disincentive to people exercising the right to buy.

Yvette Cooper

Obviously, properties need to be appropriately valued. That is not something that the Government can be expected to address in legislation, especially at a time when house prices are changing. However, the hon. Gentleman's proposal that local authorities should market the right to buy in that way seems a little surprising. It would mean that local authorities would have to go to great lengths in terms of time and expense to prepare and update plans to market something that tenants have already made clear they want and are prepared to pay for. We expect there to be more than 60,000 completed right-to-buy sales in 2003–04, so I do not think that the proposal represents a worthwhile use of local authorities' time.

6 pm

We are trying to achieve a balance. We want to give people a chance to get on the property ladder and to support their right to buy, but we also need to ensure that we clamp down on abuses and on the scams that have taken place. We also need to ensure that proper support is provided for affordable housing. We have doubled the level of investment that we inherited since 1997 and targeted more of that investment on areas of highest demand, which also tend to be the areas of highest cost. We cannot escape that fact. We do not think, however, that it is right for local authorities to have to set bureaucratic targets or develop marketing strategies. Nor do we think that it would be right to extend the right to buy to housing associations, because that would threaten their viability. If that viability had to be protected or compensation paid, it could cost £1 billion of public subsidy over three years.

For the reasons I have given, I urge hon. Members not to press their amendments.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

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