§ 7.59 p.m.
§ LORD GARNSWORTHYMy Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
§ Moved, that the House do now resolve itself into Committee.—(Lord Gamsworthy.)
§ House in Committee accordingly.
§ [The BARONESS WOOTTON OF ABINGER in the Chair.]
§ Clause 1 [Continuation of Housing Corporation with extended junctions]:
§ BARONESS YOUNG moved Amendment No. 1:
§ Page 2, line 12, after ("functions") insert ("to review and promote alterations to such an extent as the corporation consider neces sary.").
§ The noble Baroness said: I should like to make apologies on behalf of my noble friend Lord Strathcona and Mount Royal who, unfortunately, had to go on to an other engagement, and to move the Amendment which stands in his name and mine. As I think will be readily apparent, the Amendment is a probing Amendment. It is concerned with co-ownership schemes. I mentioned the schemes in my speech on the Second Reading of the Bill and the reason why I have put down the Amendment is that we are dealing in the Housing Bill with what is a major and comprehensive piece of housing legislation. Yet, there is no mention at all of this problem or indeed of the problems which have beset co-ownership schemes, particularly those under the Housing Corportion.
§ It would have been very nice for the Committee had the noble Lord, Lord Goodman, been able to be here because these are very complicated schemes and I feel that he would be the man who could explain them to us. I am afraid that in the time available I cannot go into all the complexities that have arisen. Suffice it to say that the schemes started with the highest of aspirations in 1961, but they have seldom been truly regarded or operated as co-ownership schemes and have gradually become increasingly complicated as attempts have been made to overcome the anomalies in them. Not 813 only were there anomalies in the schemes when they were originally set up, but they have been overtaken by outside events, such as rising interest rates and increased costs.
§ The basic trouble with these schemes is in an attempt to give co-owners—that is, the tenants—an interest in the equity by agreeing to pay them out when they leave a premium reflecting the increased value of the dwelling. So we have created a situation whereby an incoming tenant into one of the schemes has to pay a rent which reflects the current cost of the dwelling. The formula produced by the Housing Corporation makes rents un acceptably high. This, in turn, leads to voids which increase rents, of course, for all the other tenants in the scheme, or, at best, means that we are providing housing for somewhat richer people than these schemes were originally intended to help. The result is that they have become very complex and a great many people have suffered considerable financial difficulties since they went into them.
§ I should like tentatively to suggest three lines of approach to solve these difficult problems. The first approach might be to convert the cost rents into straight forward fair rents. Of course, if this happened they would require a Government subsidy to bridge the gap between the cost rent and the fair rent. The second possibility would be the sale of something equivalent to a long lease which would have a market value. The third possibility is simply to wind up the schemes completely, pay out to the existing owners and re-let at fair rents—a completely new scheme. There are, of course, innumerable other possibilities.
§ The unfortunate point about this whole experiment is that the original idea was a very good one and was designed to help people to find housing, not neces sarily through a local authority or through a Housing Association. I believe that in other countries, in Scandinavia and in the United States, there have been many schemes of co-operative housing which have been most effective and most useful. One of the difficulties is that co-ownership schemes are not the same as co-operative schemes, and this in itself has been one of the anomalies that has been created because people entering the schemes have thought that they were get- 814 ting something which they have not been getting.
§ As I indicated when I moved this Amendment, it is a probing Amendment and I do not expect the Government to be able to produce a solution at this Committee stage. I hope that they will say that they recognise that there is a very real problem. As I indicated at Second Reading, there are some 1,250 schemes involving over 48,000 separate units, so we are probably talking about 100,000 people—which is quite a con siderable number. It would be helpful if the Government were to say that they would look at this problem; possibly I could have a meeting with somebody in the Department so that we could discuss some suitable way forward, because I feel it to be very unsatisfactory as it is now. I should be glad to know the Government's thinking on this issue. I beg to move.
§ 7.15 p.m.
§ LORD HUGHESI must confess that we were in somewhat of a difficulty when we read this Amendment, and because of the very tight time-scale there was no opportunity of consulting the noble Baroness in advance. I have, in fact, been given two lines of reply: one on the assumption that the Amendment meant one thing; and the other on the assumption that it was a probing Amendment dealing with co-ownership. So, at least my advisers would pass because they had it in half.
I should like to say that we are in com plete agreement with what the noble Baroness has said; first, about the initial value of these co-ownership schemes; secondly, about the difficulties into which they have run, largely because of the enormous increase in interest rates; and, thirdly, about the desirability of finding a solution. One hopes that we would not be faced with the third alternative to which she directed the Committee's attention, that we should just wind up the schemes and turn them into ordinary rent ing, because that would not be a solution to the problem; it would just be admit ting defeat and abandoning something which had a very worthwhile part to play and which might once again, provided interest rates return to anything more reasonable, become a viable proposition even without change.
815 Some weeks ago I had the benefit of a meeting in Edinburgh with the noble Lord, Lord Goodman, at which we discussed the role of the Housing Corpora tion, with particular reference to its func tions in Scotland when this Bill reaches the Statute Book. I can assure the noble Baroness that both the Government and the Housing Corporation are well aware of the difficulties that co-ownership has, and we are both very much concerned to find suitable alternative forms of co-ownership, or alternatively, of co-operative housing. These are actively being considered together with the Housing Corporation. I can assure the noble Baroness that the Chairman, Lord Goodman, is excedingly anxious to try to find a successful alternative. Given the fact that this is what he wants to do and that the Government are with him and with the noble Baroness in trying to find workable alternatives, I think she will agree that we could not have the matter in better hands than those of the noble Lord, Lord Goodman. Therefore, I hope that she will feel that what I have been able to say will have served the purpose which she intends and that, therefore, she will find it possible to withdraw the Amendment. With regard to her final point, certainly if she wishes to have a discussion within the Department, my noble friend Lord Garnsworthy will be very happy indeed to facilitate this.
§ BARONESS YOUNGI should like to thank the noble Lord, Lord Hughes, for the way he has received this Amendment. Of course I am very glad to hear that the Government are working with the noble Lord, Lord Goodman, to try to find a solution to this problem. It is a very complex matter, and I can think of no better person than Lord Goodman to find a way through the complexities. So many different solutions have been put to me that I do not feel that a Committee stage is really the appropriate forum for going into all the alternatives, and therefore I touched only on three of them. Those who are knowledgeable about this matter have positive suggestions to make which I thought it would be useful for the Government to have, since we are agreed on the nature of the problem and have to try to find a way to solve it. I do not wish to press the noble Lord, Lord Hughes, this evening but perhaps he could give an indication of the time- 816 table here. These schemes have been in operation now for about 11 years, and they have run into considerable difficulty over the last 2 or 3 years. It would be interesting to know how he sees their future and whether there is the possibility of some positive proposals, say within the next year, being put to people currently in housing schemes.
§ LORD HUGHESI think that the suggestion made by the noble Baroness about a meeting in the Department would probably be the best way of pursuing this matter. It would be very difficult for me at the moment to give any sort of timetable because of the very complex nature of the problem, which was referred to by the noble Baroness herself. I think she would probably agree with me when I say that the noble Lord, Lord Goodman, is not the sort of person who likes to be associated with failure, and if there is an opportunity of finding a successful solution to this problem it will be in accordance with his make-up to do so as quickly as possible.
§ BARONESS YOUNGI should like to thank the noble Lord, Lord Hughes, for what he has said, and I beg leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Clauses 1 to 5 agreed to.
§ Clause 6 [Acquisition of securities and control of subsidiaries]:
§ 7.23 p.m.
§ BARONESS YOUNG moved Amendment No. 2:
§ Page 6, line 18, after ("corporate") insert ("normally engaged in the business of the development of land or the construction or improvement of buildings for the provision of residential accommodation.")
§ The noble Baroness said: I beg to move Amendment No. 2. Like the first one, this is a probing Amendment. I have read the report of the full debate on this Amendment which took place in the Standing Committee in another place and I do not wish, particularly at this late hour, to repeat all the arguments that were then put forward, because the matter has been very fully debated. Furthermore, along with other Members of this Committee, I experience consider able difficulty in making sure that all the information I have is up to date. I am not in any sense apportioning blame 817 to anybody, but it is rather difficult to make sure that one has read the most recent reports at this moment. Therefore, if I repeat something which is known to everybody else I hope that I shall be forgiven.
§ I recognise that Clause 6, as at present drafted, is precisely as it was drafted in the last Government's Housing and Planning Bill; but it is only fair to say that the then Minister undertook to reconsider it. The reason I put down this Amendment is because the Minister, Mr. Freeson, in replying to the debate in another place, said that he would look at this clause again.
§ We on this side of the Committee are concerned about this point because we fear the powers under the clause may be too widely used and that the real purpose of the Housing Corporation—one with which we would all agree—which is to extend its powers of helping in particular the housing action areas, might be considerably extended to enable the Corporation to acquire other corporate bodies. It is because there is no division of opinion on the ultimate purpose of the Housing Corporation that I have put down this Amendment, in order to see whether or not the Government feel able to say anything more than was said by the Minister for Housing in Committee in another place, when he undertook to consider whether this clause could be tightened up to meet more precisely what I think is intended to be the function of the Housing Corporation. I beg to move.
§ LORD HUGHESThis Amendment and the succeeding one, No. 3, are identical to Amendments Nos. 12 and 13 which were considered at Committee stage in another place. The present Amendment is very similar to one which was put down on Report stage in another place. I am surprised that, even from a probing point of view, the noble Baroness has gone back to the first set, because at Report stage, if I remember rightly, the second set did not go as far as the first. Also, I think I am right in saying that at Report stage the matter was not voted on. It was in Committee that my honourable friend me Minister undertook to reconsider the provisions, but when this other Amendment was put forward at the Report stage, he explained why no Amendment was necessary; and 818 there, so far as I am aware, the matter was allowed to rest.
As the noble Baroness has said, the provision in the Bill is identical to what was in the previous Bill, and I have no doubt that the fears which have been expressed at the present time were expressed by people in the building industry to the then Minister because, as the noble Baroness has said, he undertook to have another look at the matter. It may be that no one thought that, if these provisions were in a Bill put forward by a Conservative Government, they were there as a vehicle through which the building industry could be national ised—because although Governments sometimes do things which are not in their Election Manifestos, to expect a Conservative Government to nationalise the building industry without having previously sought the consent of the electorate is perhaps getting a little imaginative. Of course, they nationalised Rolls-Royce, but we do not expect the building industry to necessarily reach the stage which would compel a Conservative Government to nationalise it.
I can assure the noble Baroness and the industry that such fears are groundless. I have answered many letters from Scottish Members of Parliament as a result of the circularising done by the building industry about their fears in this connection, and I think they fear quite genuinely that this is a back-door method of nationalising the building industry. But I can assure the noble Baroness, and everybody else interested in the matter, that this is not the intention of the Bill. After all, if we wanted to do that we could hardly have found a more complicated way of doing it. First of all, the Secretary of State has to consent to the exercise of the Corporation's powers to acquire securities. Secondly, expenditure by the Corporation on share acquisition would count towards its borrowing limits in Clause 7(5) of the Bill, and would therfore have to compete for funds with the Corpora tion's primary functions in relation to supporting the voluntary housing movement.
Third, the terms of subsection (2) already effectively limit the range of corporate bodies in which the Corporation can effectively take controlling interest. It was these provisions to which my 819 honourable friend drew attention at Report stage in another place and which enabled him to get the Bill brought to your Lordships' House in the form which it presently takes. I hope therefore that the noble Baroness will accept that while it was perfectly proper that the Government's intention in this matter should be probed, there is neither the opportunity nor the desire to do any of the fearful things which some people in the building industry have expressed views about. I hope therefore the noble Baroness will find it possible to withdraw this Amendment.
§ BARONESS YOUNGI should like to thank the noble Lord, Lord Hughes, for his assurances on these matters. Simply because a clause was written orginally into a Bill does not mean to say that it cannot be changed. There are many in stances of such an event happening in this House, whether by accident or design. Simply because a clause appears when a Bill is published it does not mean that a Government needs to be committed to it all the way through its passage through both Houses of Parliament. I do not feel I need to apologise in any way for raising this matter, which has obviously been of great concern to a number of people. However, I am glad to have the assurance of the noble Lord, Lord Hughes, and, with that, I will withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Clause 6 agreed to.
§ Clauses 7 to 12 agreed to.
§ Clause 13. [The register of liottsing associations]:
§ 7.32 p.m.
§ LORD HUGHES moved Amendment No. 4:
§
Page 12, line 23, at end insert—
("(3A) The Corporation shall, after conultation with the committee establish under section 14 below, establish criteria which should be satisfied by a housing association seeking registration, and may from time to time, after such consultation, vary those criteria.").
§ The noble Lord said: In moving Amendment No. 4, I should also like to speak to Amendments Nos. 5 and 6. These all serve the same purpose. Following an undertaking in the Standing Committee in another place, the Government 820 have given very careful consideration to the registration of housing associations by the Housing Corporation, and in particular they have reconsidered whether it would be feasible to introduce some form of appeals mechanism.
§ The Government recognise that the refusal of an application for registration carries serious consequences for a housing association. None of the grants provided for in Part III of the Housing Bill (including the new revenue deficit grant) is available for non-registered associations, and the tenants of such associations will be given security of tenure.
§ On the other hand, it is clear that a formal appeals machinery would be quite unsuitable. The Housing Corporation will be assessing the competence and stability of housing associations in the light of their knowledge of the qualities needed to do a good job in the housing association field, and these qualities are simply not susceptible to formal demonstration or proof before an independent appellate body.
§ This is why we have provided in Clause 14 of the Bill for a Housing Associations Registration Advisory Committee, which will supervise and control the whole process of registration. The appointment of Mr. Harold Campbell, who is a well known and respected figure in the voluntary housing movement, as Chairman of the Advisory Committee has already been announced, and the Government intend to ensure that the membership of the Committee is such as to reassure housing associations that their interests will be properly taken into account. As the Bill stands at the moment, the Advisory Committee have the function of advising the Corporation on general matters connected with registration, and on any particular applications which are referred to the Committee by the Corporation.
§ The purpose of the Amendment, which I am sure will be generally welcomed, is to ensure that the Corporation consult the Advisory Committee before establishing the criteria to be satisfied by housing associations seeking registration. The Advisory Committee must also be consulted if the criteria are to be varied. Although a small change, this Amendment will in the Government's view usefully strengthen and formalise the role of the Advisory Committee during the 821 important formative stage when the criteria for registration are being determined. I beg to move.
§ BARONESS YOUNGI should like to thank the noble Lord, Lord Hughes, for his explanation of these Amendments. I wonder whether he could tell us more about the Housing Associations Registra tion Advisory Committee. Clearly this is the innovation of these clauses. He has already indicated, as we have seen, that the Chairman has been appointed. If I understand him correctly, the Advisory Committee is being established to determine the criteria by which housing associations will qualify for registra tion under the Housing Corporation. It will therefore have great responsibilities, and it would be useful to know more details as to its composition. On the question of having an appeals system, the noble Lord said categorically that the qualities required for a housing association were not susceptible to formal demonstration of proof before an appeals committee. He said this as an assertion rather than illustrating this by any particular arguments. He has there fore put an advisory committee in its place. I am not saying (hat that is necessarily wrong; but perhaps he would tell us something more about the com position of the Advisory Committee and about the criteria that would be applied to housing associations seeking registration.
§ LORD HUGHESAs the Bill stands at the moment, the purpose for which the Advisory Committee is being set up is to supervise and control the whole process of registration. But as the Bill stands some associations might have felt that they had not been given proper consideration and the criteria which was established was perhaps unfair to them. Because it would be very difficult in the application of standards to have an appeal from a particular association against refusal of registration, we felt it was much better to establish through the co-operation of this expert Advisory Committee the standards which are going to be set up right from the outset and which will apply to these associations. They should be vetted by this body. No decisions have yet been taken about the individual members of the Advisory Committee other than the Chairman whose name has been announced. It is the intention that all the main interests, 822 housing associations and local authorities, for example, will be represented on that body. We think that by having a Committee of people expert in their own aspects of the work of housing associations, and the job which they ought to be capable of doing, it will ensure that no association which ought properly to be registered will be excluded from registration because the wrong criteria have been established in the first place.
Secondly, if, in the light of experience, it should be desired that there should be alterations in any criterion, that alteration will not be made without the Advisory Committee having considered it in the first instance. I think that the noble Baroness will be satisfied, when in due course the full membership is announced, that this is a body which will be capable of doing a job in a way which will ensure fairness to every housing association whose operations come under review.
§ LORD HUGHESI beg to move Amendment No. 5.
§ Amendment moved—
§ Page 12, line 28, leave out from ("satis fies") to end of line 30 and insert ("the criteria established in accordance with sub section (3A) above.").—(Lord Hughes.)
§ Clause 13, as amended, agreed to.
§ Clause 14 [The Housing Associations Registration Advisory Committee]:
§ LORD HUGHESI beg to move Amendment No. 6.
§ Amendment moved—
§
Page 12, line 43, at end insert—
("(aa) when consulted in accordance with subsection (3A) of section 13 above, on the establishment and variation of the criteria referred to in that subsection; and").—(Lord Hughes.)
§ Clause 14, as amended, agreed to.
§ Claure 15 [Removal of bodies from the register]:
§ 7.42 p.m.
§ LORD GARNSWORTHY moved Amendment No. 7:
§ Page 14, line 3, leave out from ("a") to ("to") in line 5 and insert ("grant under section 28, section 31 or section 32 of this Act ").
§ The noble Lord said: It will be appreciated that at Report stage in 823 another place a new clause was added to the Bill—Clause 31. This Amendment is consequential on the introduction of that clause. Clause 31 gives the Secre tary of State discretion to make a grant towards the annual revenue deficit of a registered housing association. There are certain exceptions as set out in the clause. As it stands, Clause 15(5) provides that the payment of any housing association grant under Clause 28, or hostel deficit grant under Clause 32, to a body removed from the register of associations by the Housing Corporation shall cease forthwith. This Amendment adds revenue deficit grant payable under Clause 31 to the list of grants which will cease on de-registration. Clearly it would be quite wrong to continue to pay grants to a body which had ceased to qualify for them. I hope the Amendment will commend itself to the Committee. I beg to move.
§ Clause 15, as amended, agreed to.
§ Clause 16 agreed to.
§ Clause 17 [Certain loans and grants limited to registered housing associa tions]:
§ LORD GARNSWORTHY moved Amendment No. 8:
§
Page 15, line 37, at end insert—
§ The noble Lord said: Clause 17 limits to registered housing associations loans and grants from public sources after the "operative date"—April 1, 1975, or such later date as the Secretary of State may specify. On the operative date there will no doubt be some associations which are not registered—perhaps from choice—but which have in progress schemes for the provision or improvement of dwellings or other buildings. The construction or improvement of buildings is a time-consuming matter, and builders do not always present their final accounts 824 promptly. So it may be some considerable time after the operative date before the total cost is known and the final loan made.
§ In cases where the association is borrowing from a local authority, and the provision of the dwellings or other works are in one of the categories listed in sub section (4) of Clause 17, the local authority will be enabled by that sub section to make the necessary loans not withstanding that the association is not registered. The list of categories omits dwellings construction with the aid of Special Residual Subsidy under Section 73 of the Housing Finance Act 1972. To qualify for subsidy under that section dwellings must have been completed by April 1, 1975, which is by coincidence the date chosen as the operative date for bringing into operation many of the provisions of the Bill relating to registration. But, as I have already mentioned, the completion of the dwellings and the final settling of accounts and making of loans may well be separated by some lengthy period. It would clearly be undesirable to prevent the making of the loans needed for completing such schemes, and this Amendment, by adding Special Residual Subsidy Schemes to the list in Clause 17(4) preserves the local authorities' powers to make such loans. I hope the purpose of this Amendment will commend itself to the Committee, I beg to move.
§ Clause 17, as amended, agreed to.
§ Clauses 18 to 20 agreed to.
§ Clause 21 [Corporation's power to require transfer of land of registered 1965 Act associations]:
§ 7.48 p.m.
§ LORD GARNSWORTHY moved Amendment No. 9:
§ Page 19, line 23, leave out ("which is not a charity ").
§ The noble Lord said: I beg to move Amendment No. 9, and I think it would be to the convenience of the Committee if I spoke at the same time to Amendments Nos. 10, 11 and 12. Clause 21 empowers the Housing Corporation in certain circumstances to direct a registered 1965 Act association, that is to say, one registered under the Industrial and Provident Societies Act and under Clause 825 13 of this Bill—to transfer its land to the Corporation or to another registered housing association. As set out, the clause is related to the 1965 Act associations which are not charities, because it would not be right that charitable property should be alienated to other than charitable purposes. After further consideration, wc appreciate that the powers of the clause can quite properly be applied to charitable 1965 Act associa tions if the clause further provides that the transfer of land owned by such an association is to another registered hous ing association which is also itself a charity whose objects appear as nearly as practicable alike to those of the association from which the land is directed to be transferred. Amendments Nos. 9 and 10 are designed to achieve that effect.
§ The purpose of directing such a transfer of land is to enable it to be put into the hands of those who will manage it better or more efficiently. This is clearly a drastic step to be employed only in appropriate circumstances, and indeed with appropriate safefuards. The circumstances considered appropriate are those where a registered housing associ ation has fallen from grace to such an extent that the Corporation have found it necessary to have an inquiry made into its affairs and have concluded that the maangement of those affairs has got into such a state as to be incapable of being set right by the removal of the present committee members and the appointment of others, as provided under Clause 20.
§ So far as the safeguard is concerned, here it is that the use by the Corporation of their powers under the clause requires the consent of the Secretary of State, and it is not to be expected that such consent will be lightly given or given without due inquiry into the circumstances and merits of the case. The Charity Commissioners have wide powers to act for the protection of charities which are within their discretion under the Charities Act 1960. Charities which are registered industrial and provident societies, such as those to which the Amendment applies, are exempt from registration under the Charities Act and exempt from the Charity Commissioners' powers under that Act. Amendments Nos. 11 and 12 are purely drafting Amendments which have been 826 inserted for the sake of the accuracy of the clause.
§ I hope that with that explanation the Committee will be persuaded that these Amendments are an improvement upon the Bill as drafted. I beg to move.
§ BARONESS YOUNGI should like to thank the noble Lord, Lord Garnsworthy, for his explanation of these Amendments. This is a very complicated subject and I shall read what he has said very carefully. However, I wonder if I might ask the noble Lord to clarify one point. As I understand it, it is clearly a drastic matter for the Housing Corporation to move in and direct that a housing association should be transferred in this way. Quite rightly, he has given us the safeguards that would apply in these circumstances and, indeed, an explanation of the kind of circumstances which would have to arise before this took place. Is this a matter which would be discussed at any stage by the Advisory Committee, or is it a quite separate issue? It seems to me that before a housing association gets into this kind of position it ought to have adequate warning. It might need to have help from outside experts to prevent it from degenerating to this point, because clearly it it bound to affect the tenants of the association. If it is not possible to deal with it today, I wonder whether the noble Lord could write to me about this subject and explain how he envisages this kind of situation arising, and what steps could be taken in the meantime to prevent it arising.
§ LORD GARNSWORTHYI am very grateful to the noble Baroness for the way in which she has spoken. Clearly we will write to her to confirm that my impression is correct. I believe that this is a matter which I touched upon in my Second Reading speech, when I indicated that the criteria which would be applied by the Housing Corporation would be drawn up in consultation with the Advisory Committee. I hope that with that assurance the noble Baroness will feel that she is able to give me an opportunity to check whether my recollection is accurate. May I say further that the Advisory Committee is concerned only with registration. As I have indicated it can be helped and advised by the Corporation. Perhaps that is a more accurate way of putting it than was my reference to the drawing up of the criteria. We shall write at length to 827 the noble Baroness, so that she will have an opportunity of being quite satisfied before Report stage.
§ LORD GARNSWORTHYI beg to move Amendment No. 10.
§ Amendment moved—
§
Page 19. line 30, leave out from third ("to") to end of line 31 and insert ("another body-in accordance with subsection (1A) below.
(1A) A direction under subsection (1) above may require the association concerned to trans fer the land belonging to it,—
§ LORD GARNSWORTHYI beg to move Amendment No. 11.
§ Amendment moved—
§ Page 19. line 32, after ("transfer") insert ("in pursuance of a direction ").—(Lord Garnsworthy.)
§ LORD GARNSWORTHYI beg to move Amendment No. 12.
§ Amendment moved—
§ Page 19, line 41, after ("transfer") insert ("in pursuance of a direction").—(Lord Garnsworthy.)
§ Clause 21, as amended, agreed to.
§ Clauses 22 to 24 agreed to.
§ Clause 25 [Change of objects of certain charities]:
§ 7.56 p.m.
§ LORD M AYBRAY-KING moved Amendment No. 13:
§ Page 22. line 16, at end insert—
- ("(4) In the case of a housing association founded by a registered charity, the provisions of this section shall apply as if such housing association were itself such a registered charity as is described in subsection (1) of this section.
- (5) In considering an application from a housing association founded by a registered charity to change its objects, the Charity Commissioners shall not permit any variation of objects which would be outside the objects of the charity which founded the housing association.
- (6) For the purpose of this section a housing association shall be regarded as founded by a registered charity if its rules, or any agreement entered into in connection with its formation, shall so state.").
§ The noble Lord said: I beg to move the Amendment which stands in my name on the Marshalled List. This Amendment gives me the opportunity to pay tribute to the housing associations and registered charities of Great Britain. In their various ways these are supplementing what ihe Government and the local authorities are doing in providing houses for special groups of citizens. I know intimately one such body which has among its objectives that of providing sheltered accommodation for poor old people in groups of flats—perhaps 20 with a warden and thus giving some discreet help to them. It is an associa tion which has already built 2,000 such flats and is building another 2.000. I have a friend in Hampshire who has set up a housing association which has built 500 such flats, and I am delighted to know that last year Her Majesty awarded him the M.B.E. These are just two examples of the many associations of varied kinds which provide housing and make a valuable contribution to providing homes for special groups.
§ This Amendment is a simple one, although I am told that the issue which is raised is complex. It was raised in Committee in the other place rather late in the day by Mr. Hugh Rossi, and it was discussed briefly there. The Minister responsible, Mr. Freeson, undertook to look into the matter. It was not pressed to a Division. It was not raised at Report stage. However, I understand that since then the Minister has taken great pains to go into the problem but has come to the conclusion that this Amendment is not necessary.
§ This Amendment concerns only those housing associations which are set up by registered charities. The present position is that if a registered charitable organisation includes amongst its efforts that of providing homes it must set up a housing association. This is registered as such and is then able to secure grants from the local authority to order its housing projects. However, the housing association itself becomes independent of the parent charity. It becomes constitutionally independent but not financially independent. It is just conceivable that 829 in the years ahead there may come a time when a housing association founded by a charity would throw off the shackles of the parent authority and administer its housing programme in a way which was divorced not only from the basic object of the founder charity, but from all the appeals that the charity makes for monies which are contributed to it.
§ The clause which I seek to amend gives me great satisfaction. It enacts that there will be no variation of the objects of a registered housing association (or any other charity) without the consent of the Charity Commissioners. This is excellent. This Amendment goes a little further and makes things a little tighter. It says that if a charity sets up a housing association the Charity Commissioners will not permit any variation of objects of that housing association which would be outside the objects of the parent charity. I know the Minister has said that the parent charity ought to see that this is done when setting up the housing association. Experience has shown us that it is difficult, if not impossible, when setting up a trust deed.
§ I have spoken to the noble Baroness, Lady Young, about this Amendment. Her own splendid work for charities and housing associations in Oxford I know of and admire and I hope I may have her support with the object in mind of moving again the Amendment which her colleague in another place moved in Committee. I know that this Government, and indeed all post-war Governments, appreciate the work of housing committees and of the charitable associations which support some of them. This Amendment seeks to tighten the control over only those housing associations which are provided by charitable associations. I hope the Minister will now find that he is able to accept a little Amendment to an excellent clause. I beg to move.
§ BARONESS YOUNGI think the noble Lord, Lord May bray-King, is being over modest if he feels that having explained this situation so clearly he needs my sup port in this matter. However, what I think would be helpful is that if the Government do not feel ab'e to accept this Amendment as it stands, they could explain the position about the Charity Commissioners and the relationship be tween charities which raise money for cer tain purposes and which then have this 830 connection with housing associations. It would be useful to have this matter on the Record because, as the noble Lord, Lord Maybray-King, has said, when this matter was discussed in another place it came at the end of a Committee and the discus sion had to be cut short.
§ LORD HUGHESI have explained to the noble Lord, Lord Maybray-King, the rather peculiar circumstance that I should be inviting him to withdraw this Amendment because I am aware of the charity and the housing associations of which he gave an example but which he did not name. Until I was required to resign on becoming a Minister at the Scottish Office I was the Vice-President of the Scottish housing association fostered by that charity, and one of the functions which I shall be carrying out towards the end of this month is to open the first scheme built by that housing association in Scotland, at Bowness. So it is not because I have any persona] hostility—rather to the contrary, I feel almost under an obligation to join with the noble Lord in this Amendment.
The object of the clause which the noble Lord seeks to amend is to ensure that registered housing associations, which are in themselves registered charities and not Companies' Act companies or exempt charities, do not vary their objects without the consent of the Charity Commissioners after consultation with the Housing Corporation. As the noble Lord has said, the purpose of this Amendment is to extend this control to registered housing associations which were founded by charities, and the aim of the Amendment is not to control the housing associations from the point of view of their housing activities, which are already adequately controlled by the provisions in Part II of the Bill, but to ensure that the objectives of the housing association did not vary from those of the founding charity. There may be disagreement between the founding charity and its own housing associations but this Bill is not the place to deal with that. The concern of the Bill is to exercise control over all housing associations as housing associations, no matter what their origins may be.
Registered housing associations will be subject to strict control under the provisions of Part II of the Bill and will have to keep firmly to their allotted task, whether founded by a charity or not. 831 Housing associations which are registered under the Industrial and Provident Societies Acts by the Registrar of Friendly Societies, to be eligible for registration by the Housing Corporation are to be closely restricted as to the objects they may have, under Clause 13(2) and (3) of the Bill—objects which may well not be compatible with those of the founding charity—and it is intended that the Corporation shall make it a condition of registration of such associations that their rules include one preventing alterations in their objectives without the consent of the Corporation. Thus, for the future, changes in the objects of such associations will be firmly under control.
It is for these reasons that, with the greatest of reluctance, I am unable to advise the Committee to accept this Amendment; but I think the noble Lord, Lord Maybray-King, knows that the Minister is well disposed to the objects which he has in mind, and I hope the revelations of my past which I have given in this matter show that they also have a friend in me. Therefore I hope the noble Lord will find it possible to withdraw this Amendment.
§ LORD MAYBRAY-KINGI am completely disarmed by the gracious way in which the noble Lord has replied to this debate. I find in him the same thoughtful kindness of the Minister himself, Mr. Freeson. I have anxieties; but I think what the noble Lord has said—and indeed v/hat the clause itself says—has relieved my mind of pretty well all of them. I ask leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ LORD GARNSWORTHYIt would seem to me that this would be a convenient moment for the House to resume. Therefore I beg to move that the House be now resumed.
§ House resumed.