HL Deb 07 August 1980 vol 412 cc1634-7

9 After Clause 109, insert the following new clause:

Housing subsidies

("—(1) The provisions of section 24(1)(B) of the Housing Subsidies Act 1967 shall have effect where a person borrows, or two or more persons borrow jointly, from a qualifying lender on the security of a freehold or leasehold estate of the borrower, or of one or more of the borrowers (including an estate held jointly or in common by the borrower, or one or more of the borrowers and one or more other persons) in land in Great Britain, and the following conditions are satisfied:—

  1. (a) that the loan is or was made as part of a scheme under which not less than nine tenths of the proceeds of the loan are or were applied to the purchase by the person or persons to whom it was made of an Annuity ending with his life or with the life of the survivor of two or more persons (in this section referred to as "the Annuitants") who include the person or persons to whom the loan is made;
  2. (b)that at the time the loan is made the person to whom it is made or each of the Annuitants had attained the age of 65 years; and
  3. (c)that the person or persons to whom the loan is made or each of the Annuitants uses the land on which it is secured as his own residence.

(2)The borrower or borrowers may by notice in writing to the lender in such form as the Ministry may direct (in this section referred to as an "Option Mortgage") elect that the loan shall be subsidised in accordance with the provisions of Part II of the Housing Subsidies Act 1967 and the Option Notice shall be treated for all purposes as if it were an Option Notice made under the provisions of section 24 of the said Act.")

The Commons disagreed to the above amendment but proposed the following amendment in lieu thereof:

10 After Clause 109, insert the following new clause:

Subsidised loans—further application of Part II of 1967 Act

(" .—(1)In relation to a loan which satisfies the two conditions stated in subsections (2) and (3) below Part II of the Housing Subsidies Act 1967 shall have effect as if the loan were for or in connection with one or more of the purposes specified in section 24(1)(b) of that Act.

(2)The first condition is that the loan—

  1. (a)is made part of a scheme under which not less than nine-tenths of the proceeds of the loan are applied to the purchase by the person or persons to whom it is made of an annuity—
    1. (i)ending, if the loan is made to one person, with his life or with the life of the survivor of two or more persons who include that person, and
    2. (ii)ending, if the loan is made to more than one person, with the life of the survivor of two or more persons who include the persons to whom the loan is made; or
  2. (b)was made under such a scheme before the commencement of this section.

(3)The second condition is that each of the persons mentioned in subsection (2) above has attained the age of sixty-five years at the time the loan is made (or, if the loan was made before the commencement of this section, had attained that age at the time the loan was made).")

They have made the following consequential Amendment to the Bill:

5.12 p.m.

Lord BELLWIN

My Lords, I beg to move that this House doth not insist on their Amendment No. 9 but accept in lieu thereof Amendment No. 10 proposed by the Commons, together with consequential Amendment No. 11, which has the effect of applying this provision to Scotland.

My Lords, as the House knows, I announced on 29th July in answer to a Question from my noble friend Lady Faithfull that the Government had agreed that the option mortgage scheme should be extended, in the way proposed in the amendment passed by this House, to provide additional income to elderly non-taxpaying owner-occupiers who buy an annuity on the security of their home. As the sponsors of the amendment intended, this will help elderly people to remain longer in their own home.

But the amendment passed by your Lordships is incompatible with the statutory framework of the option mortgage scheme. The amendment proposed by the Commons remedies this defect, but fulfils the intention of your Lordships' amendment. I should like to pay tribute to noble Lords from all parts of this House who have argued so forcefully for this concession, and in particular to the noble Lord, Lord Banks, who in the last few months alone, has argued the case for this amendment on four occasions before your Lordships.

The Bill requires a number of detailed amendments to be made to the option mortgage scheme; we shall need to ensure that proper accounting arrangements are made. I cannot yet say exactly when we shall be able to implement the new clause, but I can assure your Lordships that it is our intention to do so as soon as possible. I beg to move.

Moved, That this House doth not insist on their Amendment No. 9, but agree to the Commons Amendment No. 10 proposed in lieu thereof.—(Lord Bellwin.)

Lord BANKS

My Lords, I should like to thank the noble Lord, Lord Bellwin, for his explanation of the new Government amendment and also for his kind reference to myself. I should like also to thank the Government for accepting the intention of the amendment which I moved at the Report stage in this House and which this House approved. The decision by the Government and the approval obtained in another place yesterday for this new amendment has given much satisfaction to all who have wanted to see this reform introduced, both organisations and individuals.

Of course the greatest satisfaction will be felt by those elderly non-taxpaying home owners who will now be helped to secure a modest increase in income, as the noble Lord, Lord Bellwin, pointed out, which will allow many of them to go on living in their own home, as they would wish to do. I am glad that the noble Lord, Lord Bellwin, said that it was the intention of the Government to see that this provision is in operation as soon as possible. In conclusion, I should like to thank all noble Lords in all parts of the House who have supported the introduction of this reform.

On Question, Motion agreed to.

Clause 144

11 Page 94, line 25, after ("109") insert ("to")

Lord BELLWIN

My Lords, I beg to move Amendment No. 11 as a consequential amendment.

Moved, That this House doth agree with the Commons in their consequential Amendment No. 11. —(Lord Bellwin.)

On Question, Motion agreed to.