Housing (Scotland) Bill

HL Deb 28 April 1986 vol 474 cc72-124

House again in Committee on Clause 1.

Lord Carmichael of Kelvingrove moved Amendment No. 3: Page 1, line 9, at end insert— ("(1A) In section 3A of the 1980 Act (Secretary of State's power to authorise refusal to sell certain dwelling houses provided for elderly persons)—

1. (a) for subsection (1) there shall be substituted the following subsection—
1. "(1) This section applies to a dwelling house which—
2. (a) is particularly suitable for occupation by persons of pensionable age, having regard—
1. (i) to its location, and
2. (ii) to its size, design, heating system and other features so far as those have been provided by the landlord or a predecessor of the landlord, and
3. (b) was let to the tenant or a predecessor in title of his for occupation by a person of pensionable age or a physically disabled person (whether the tenant or predecessor or another person).";
2. (b) for subsection (3), for the words "specify the facilities and features of design or adaptation" there shall be substituted the words "specify those aspects of the location, size, design, heating system and other features".").

The noble Lord said: This amendment brings the right-to-buy exclusion arrangement for elderly persons' housing in line with those secured on an all-party basis in your Lordships' House during the passage of the English Housing and Building Control Act 1984. I am sure that the Minister will be familiar with these provisions and that when he saw the amendment he recalled that my noble friend Baroness Birk on 28th February moved amendments to the same effect as I am about to move this evening.

Under the right to buy elderly persons' housing is currently excluded if the Secretary of State is satisfied that it meets certain tests. The main test is that the house has facilities which are substantially different from those of an ordinary house and it has been designed or adapted for occupation by an elderly person whose special needs require accommodation of the kind provided by that particular dwellinghouse.

One of the unfortunate matters that has occurred during the operation of this provision is that the Secretary of State has placed a very severe interpretation upon it and authorities are being required to demonstrate that their dwellings meet the detailed design laid down in the Scottish Design Standards Handbook, including even, for example, types of floor covering. That makes it very difficult for older dwellings to be included which were built for elderly persons before the handbook was produced. It almost seems like sleight of hand that the Secretary of State should use such criteria, bearing in mind that when the houses were originally adapted they were perfectly suitable, and that in many cases it is merely because society has moved to a different level that new standards, quite correctly, are set up. However, it does not mean that houses meeting the old standards—until they are improved—are still not perfectly suitable for elderly people, and much more suitable than the average house.

The way in which the provisions have been interpreted recently does not take account of historical circumstances. The handbook—perhaps quite correctly for new build—is very strict on room size, the number of rooms and so on. By far the majority of dwellings submitted to the Secretary of State are being refused exemption, often on very minor grounds of detail. Many of these properties would generally be accepted as elderly persons' bungalows, although for historic and other reasons they do not meet the very special detailed design standards to which I have already referred.

It is also important to realise that, under an equivalent exemption arrangement, 95 per cent. of cases were turned down by the Government in England, and, according to the Institute of Housing—it does not have an equivalent overall figure for Scotland—direct evidence from individual local authorities suggests a similar success rate in Scotland. There is a real shortage of public sector accommodation throughout Scotland for the elderly. That which is available is not easily replaced once it has been sold, especially when one looks at the pressures on the finances of housing authorities at present. Therefore we believe that an essential pool of rented accommodation should be protected; that is, special houses which were built or adapted for a particular purpose.

The amendment proposed borrows the wording from the English changes which won all-party support in your Lordships' House in 1984. It would remove the stringent design tests currently required, and should allow a greater degree of flexibility to be incorporated within the Secretary of State's decisions. The intention is to exclude the majority of purpose-built or converted accommodation for the elderly from the right to buy. If that were to happen, we would also hope that there would be a change in the criteria that would guide the Secretary of State on whether or not he gave exemption from the right to buy.

In simple terms I consider—and the Institute of Housing also considers—that certain principal points should be met before a house is considered suitable for the elderly. There should be easy access on foot to the dwelling. The accommodation, generally speaking, should be on one level, although occasionally if there were a lift involved, perhaps two levels would be acceptable. There should be no more than two bedrooms, because we do not want large houses. There should be some form of central heating. The w.c., bath and shower should be designed for easy and safe use by elderly persons and, of course, working surfaces, shelves, cupboards, electricity sockets and light switches should be set at heights suitable for elderly persons.

It is not intruding too much on the Bill to suggest that the amendment should be accepted by the Government. I cannot see it greatly reducing the number of houses for sale, but it would certainly be a great help in alleviating the pressure on local authorities and housing associations to provide houses for elderly people. It would also mean that the Scottish housing associations would be in the same position as the English associations, and that is something which I would hope the Minister would find difficult to resist, especially when one bears in mind that it is obviously better than the situation which we have in Scotland at present. Without the amendment we would be in a worse position than the English associations. I beg to move.

Lord Mackie of Benshie

I should like to support the amendment which is certainly in line with similar amendments to which I gave support in the 1984 Bill. Again, I should like to stress a point regarding the rural areas. One of the things that makes a rural area work is the provision of retirement houses for old people. Certainly in Angus the old county council had a very enlightened policy and said simply that if a farm worker had worked all his days for his own house and never cost the community a penny, he was entitled to a retirement house. They built a lot of retirement houses, and those houses are now available for sale. In my view it is quite wrong because there is an enormous temptation in a rural area. Normally the occupants have sons or daughters who are well-off and working in some other area. The chance to buy a cheap house for them to use as a holiday home is one which has no good social purpose but which is very nice for the family themselves. For that reason alone I think that the Minister should accept the modifications to the specifications as to what should be exempt, as set out in the amendment. Although the Minister is talking about defence or some other subject with the noble Lord, I trust and hope that he will understand that my standing here talking is in support of the amendment and will do something about it.

8 p.m.

Lord Gray of Contin

I apologise to the noble Lord for allowing my attention to wander momentarily during his intervention. I assure him that I fully appreciate the points that he was making in support of the noble Lord, Lord Carmichael.

I am bound to admit that when I studied this amendment a little earlier in the day I was puzzled as to what arguments the noble Lords would produce to support it. In my view the amendment simply offers an alternative wording for Section 3A of the Tenants' Rights, Etc. (Scotland) Act 1980, without in any way altering its effect.

I understand, however, that the noble Lords' purpose is to specify in greater detail what is meant by the words "facilities substantially different from an ordinary dwelling-house". But his concern is unfounded. In practice, I believe that both the Scottish and English provisions are closely similar in their effect. We have never had any complaint from landlords or tenants that they have difficulty in recognising which features might qualify a house under Section 3A. I believe therefore that this amendment is unnecessary.

The criteria which the Secretary of State adopts in deciding whether a house has features which qualify it as being "substantially different from an ordinary dwelling-house" are well known to landlords. There is certainly no secret about them. The Secretary of State's decision is taken by reference to paragraph 9.2.1. of Part 5 of the Scottish Housing Handbook. This lists a number of design features appropriate to elderly persons' housing. They include, first, that the house should be provided at ground or first floor level, or in multi-storey developments with lift access (in other words, the English reference to "location"). The remaining specifications relate to space standards, heating standards and the provision of special features such as grab rails, special doors and light switches. These equate to the reference in the English provision (and indeed in the present amendment) to "size, design, heating system and other features".

In deciding whether a house should be exempted from the right to buy, the Secretary of State would normally look for a House to have a majority of the features listed in the Scottish Housing Handbook. The house is by no means required to have all the features, however, and one advantage of the Scottish system is that each case is considered on its merits. The Committee will note that the Secretary of State does not normally look at whether the house is currently let to an elderly person or his successor (which is a requirement of the English provision and the current amendment). In practice, given the type of house, it would be very unusual for the landlord to have let it to somebody other than an elderly person, but this is not something about which we make a requirement in Scotland.

I could understand the case for this amendment if it were argued that the Secretary of State had somehow exercised his power under Section 3A of the 1980 Act in an arbitrary manner. But the Secretary of State's decisions are reached by reference to objective criteria set out in the Scottish Housing Handbook. I appreciate that the Act does not say that the Secretary of State must have regard to the Scottish Housing Handbook, but in practice that is the way that the words "facilities substantially different from an ordinary dwelling-house" are interpreted.

Although the number is not large, the Secretary of State receives a steady flow of applications from landlords under Section 3A. About two-thirds of the applications are accepted and the landlord is then given permission to refuse the sale. I think it is significant that we have never had a complaint either from a landlord or a tenant over an individual decision. Nor indeed has it ever been suggested by landlords, who I am sure would be the first to complain, that they could not understand the basis on which the Secretary of State's decisions are reached or that the criteria he adopts are unfair. In those circumstances, and with that full explanation, I hope that the noble Lord will be prepared to withdraw his amendment.

Lord Carmichael of Kelvingrove

There are two points. There is the point made by the noble Lord, Lord Mackie of Benshie, on houses built for farm workers, when, I imagine in general at a fairly advanced age, they retire and these houses are then taken up profitably for sale as holiday homes.

The other question is on design features. The complaints I have received suggest that the interpretation is too strict. Some houses may be traditionally accepted as being for elderly people, with many of the features that the noble Lord, Lord Gray, mentioned—the space standards, the light sockets, handrails, and such things. But others may not because of the period when they were built compared with the period we are in now. Some enlightened authorities were building features into houses which were received with great acclaim 20 years ago, but now we have moved on and they are perhaps not quite enough. Nevertheless they are far more suitable for the elderly than the ordinary house. Since money has been spent on the adaptations, it seems wrong that we should allow these houses to be sold into the open market.

The Minister spoke about the record of the Secretary of State. Instead of merely saying that two-thirds of the applications have been accepted by the Secretary of State, could he stretch a point and give us figures? On some of these Bills we talk about two-thirds one minute and percentages another, and it would be helpful to get the figures. What is it two-thirds of? I should be happier if I could hear these figures.

Lord Gray of Contin

I cannot give the noble Lord that figure off the top of my head. I am afraid that two-thirds is the best I can do for him tonight, but I shall get the figures for him, drop him a note and let him know what they are.

Let me deal with the point raised by the noble Lord, Lord Mackie of Benshie, and the point raised by the noble Lord, Lord Carmichael. First, on the point raised by the noble Lord, Lord Mackie, about retirement homes in rural areas being sold as holiday homes, the 1980 Act has provisions in Section 4 to prevent houses being re-sold as holiday homes.

The noble Lord, Lord Carmichael, raised a point about the Secretary of State's interpretation of Section 3A being severe. That is not my understanding. I do not think that it is any more severe than the recent amendment where houses would also have to qualify in respect of size, design, heating systems and other features. The same features listed in the handbook and presently used by the Secretary of State apply. It is not our experience that there are resulting complaints. I think that the Secretary of State uses the guidelines fairly.

Lord Mackie of Benshie

I accept much of what the Minister says, but if there are 100 objections to the sale of houses from the local authorities or the landlords, whoever they are, and one-third are upheld, that is a fair number. But if that was the case in a rural area, it would be fairly serious. It would be interesting to have a break-down of the figures if that were possible.

Lord Gray of Contin

I shall certainly provide that, and when I write to the noble Lord, Lord Carmichael, I shall make sure that the noble Lord, Lord Mackie, receives a copy. But I think we are talking of relatively small numbers.

Lord Carmichael of Kelvingrove

I thank the Minister for promising to write to me. I think I should also say to him that people in Scotland will have read his words and his interpretation of the Act, or they will read them. I find the information as skimpy in some ways as does the Minister, but there is perhaps more excuse for me than the Minister. I shall look forward to hearing his reply, but I should say that I will inquire in Scotland, and I reserve the right to raise the same point in more detail at the Report stage. In the meantime, I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 1 agreed to.

Clause 2 [Increased discount where dwelling-house purchased is a flat]:

Lord Gray of Contin moved Amendment No. 4:

Page 2, line 12, leave out ("(2)") and insert ("(3)").

The noble Lord said: For the convenience of the Committee, I think we have agreed that we should deal with Amendments Nos. 4, 7, 8 and 13.

I indicated in introducing our debate on Second Reading that we were giving further thought to the provisions of Clause 2 of the Bill, as a result of pressure which had arisen in another place, and that we would he bringing forward further amendments. The present amendments are the result of that consideration.

It may be helpful if I remind the Committee that a tenant exercising the right to buy is entitled to a discount on the market value of his council home, which is related to the length of time he has been a public sector tenant. In order to buy, the tenant must normally have a qualifying period of at least two years. He is then entitled to a basic discount of 32 per cent., which rises by a further 1 per cent. for each additional year, up to a maximum discount of 60 per cent. after 30 years.

Clause 2 of the Bill, as introduced, proposed that discount should be increased by 10 per cent., where the house being purchased is a flat. People buying a flat would then be entitled, under our original proposals, to a new minimum discount of 42 per cent. after two years, rising to 70 per cent. after 30 years.

We felt that this was necessary because flats had been selling much more slowly than other types of houses under the right to buy. Flats account for almost half the total public sector stock in Scotland. However, in 1984, to take the most recent year, out of more than 16,000 houses sold under the right to buy, fewer than 2,000 were flats. This pattern has been repeated in every year since the right to buy was introduced. Our research suggested that purchasers were apprehensive about the additional costs and responsibilities associated with owning a flat; and this is why we thought it fair to recognise their concerns by the provision of additional discount. I should mention that similar changes to the discount rules for England and Wales were included in the current Housing and Planning Bill.

During the passage of both the present Bill and the Housing and Planning Bill in another place, there was concern that our proposal for an additional 10 per cent. discount did not go far enough and that some further incentive was needed if we were to make the purchase of a council flat an attractive proposition. As a result, we undertook to give further consideration, as I indicated on Second Reading, to what might be an appropriate level of discount on flats.

The present amendments therefore provide for a rather better discount for flats. Where somebody is buying a flat, we are proposing that his discount entitlement should rise by steps of 2 per cent. each year, instead of 1 per cent. as at present. A tenant with a minimum two years' standing therefore would be entitled to a discount on a flat of 44 per cent., and the maximum of 70 per cent. would be reached after 15 years.

As a result, the upper and lower limits of the discount scale on flats sold under the right to buy will remain virtually the same as in the Bill as introduced. However, the time required in order to qualify for the maximum discount will be halved. This will benefit the tenants of all types of flats. It recognises that because of the way allocation systems operate, tenants of flats tend to be younger people, and I believe that the amendments will be particularly welcomed by younger purchasers taking their first steps into home ownership.

Perhaps I may say something briefly about Amendment No. 13. This amends Section 9A of the 1980 Act and is consequential upon the other changes we are making to the rules governing discount on flats. Section 9A of the 1980 Act provides that where a person is granted a secure tenancy in pursuance of Section 10(3) of the Housing Defects Act 1984, he does not have to wait the minimum two years, as any other tenant would, before qualifying for the right to buy, but becomes immediately eligible to buy, although starting at a basic 30 per cent. discount. As a consequence of our proposal to increase the minimum discount on flats by 10 per cent., it is necessary' to amend Section 9A to provide that where a person whose house has been repurchased as defective is granted the secure tenancy of a flat, he shall qualify immediately to buy at a minimum discount of 40 per cent. (and then rising by an additional 2 per cent. for each subsequent year of tenancy, as with any ordinary tenant).

These amendments fulfil our undertaking to see whether we could improve on our earlier proposals for discount on flats. They will promote the extension of home ownership to council flats and will be of particular benefit to younger purchasers. I beg to move.

8.15 p.m.

Lord Ross of Marnock

There is no end to the generosity of this Government in respect of the people who used to be very much despised by the party opposite. I remember it being stated that people who lived in council houses were second-class citizens. I think the Member of Parliament who said that is now a Member of this Chamber.

Here, certain flats are being given special bargain rates. I think it is in line with that television programme "The Price is Right"—come on down! Bargains for everyone, at the expense of someone else. It is not the Government who own these houses; the landlords of these houses are the local authorities, the housing authorities, or now included within this—as we have agreed to Clause 1—the housing associations. You can well imagine how a housing association which has worked hard on a particular tenement property—and they will be flats—will find that it has to grant a discount of 70 per cent. The tenants may have been in that house for only two years—I hope I shall be corrected if I am wrong—but if they have come from a local authority house before going into that one that counts as waiting time, so they can get a discount of 70 per cent.

I suppose that from her good business sense the noble Baroness, Lady Carnegy, will think this is wonderful, giving them 70 per cent. discount. I think it is robbing the local authorities of their property to do this kind of thing. By the way, I am a little muddled these days so I looked this up, and the proposed change is: after the words '32 per cent.' there shall be inserted the words', or where the dwelling-house is a flat 42 per cent,' I looked up the Act. That says: the discount for the purposes of this subsection shall be— (i) 33 per cent. It does not refer anywhere to 60 per cent; it refers to 50 per cent. Can we have an explanation as to why we are referenced to a figure in the Act and when one reads the Act it is not there? It does not say "the Act as amended by". This is how it becomes ridiculously complicated for simple-minded Lords who voted the wrong way last time, including the noble Baroness, the con-woman. She is prepared to be conned into anything. If any vote is predictable in this Chamber, it is hers. Never mind, one day she might make it to the Front Bench; but that is not the way to do it. If she wants to make herself invaluable to the Front Bench she should vote against the Government once or twice. She will gain promotion quicker that way. I have had longer experience of the House of Commons and other places than the noble Viscount who has now come to grace the Front Bench. I can tell him that that is the way to achieve that particular ambition.

I cannot see the justification for this clause. I have two amendments down, but the change it makes gives speedier access to the 7 per cent. I am "agin" it. I think the Government are quite wrong. We have had some figures quoted to us about these flats not selling so well. I believe they are selling better in Scotland than they are in England. I believe that about 12 per cent. of these flats have gone in Scotland. I can understand the Government feeling that they are not selling well enough, simply because people have not been buying in Scotland.

To get them to buy we enlarge the carrot. We now have the 42 per cent. for a start, increasing by 2 per cent. and reaching the 70 per cent. much more quickly. What that means to me is that the Government's policy is failing. One can explain the 12 per cent. more easily because there are more of these kinds of flats in Scotland than there are in England: the old four in a block. The Government recognise the failure and in their determination to give this right to buy (which means to reduce the liability of the Government and to reduce the housing grant to local authorities) they are selling these flats at these give-away prices. The generosity of this Government is staggering towards people whom so recently they despised.

I could quote yet another, perhaps not a lady on this occasion—she became a Baroness too—but she was a Member of Parliament for a time. As she is no longer with us I do not think I will quote her, but she too had this attitude towards council tenants.

The council tenants whom the Tories so despised are now becoming the people who are given the bargains and the better bargains. I think the Government's policy is wrong. In many cases the policy in respect of local authorities is wrong, bearing in mind that the houses on which people have taken up the right to buy have been the best houses. One can see that all over the place, in Ayrshire, in Kilmarnock, in Glasgow and in Edinburgh. They are the best houses and now when the market is sticking the Government increase the inducement. But they are still giving away houses for which people are waiting on the housing list. If the houses are sold they will not be available. I do not know whether the Minister knows, but there are young people who are subsidising their parents to buy the houses in the knowledge that their aged parents will die and that they will move into them; so the bargain is not even to the tenants but to the sons and daughters. I do not think that is right. People will wait in the queues and will not get in.

The further evil of this is that it will now apply not only to the local authority houses. By virtue of Clause 1 and two votes in this Committee it will apply also to housing association houses. I do not think the Committee can be proud of that. I am sorry, but I cannot support the Government in what they are doing in this amendment.

Lord Gray of Contin

The noble Lord raised one or two points that I should answer. He spoke about the 33 per cent. and the 50 per cent. Those figures refer to discount repayment requirements, not to discount itself. He spoke about sales at discount being at the expense of the landlord. That is not so. The so-called cost floor provisions which we shall no doubt discuss on Clause 3 provide that discount is restricted if the sale price will not be sufficient to cover the outstanding debt on the house.

The noble Lord, Lord Ross, spoke about discount on housing association fiats. While housing association flats will be subject to the same discount as council flats—that is, up to 70 per cent.—it must be remembered that housing association flats are often newly renovated at considerable public cost. In those cases the maximum discount may be limited by the outstanding debt test, the cost floor already in the 1980 Act.

I hope that this clarifies the questions that the noble Lord had and that he may now be prepared to accept the amendment.

On Question, amendment agreed to.

The Deputy Chairman of Committees (Earl Cathcart)

In calling Amendment No. 5, I should advise the Committee that if that Amendment is agreed to I cannot call Amendments Nos. 6 and 7.

Lord Ross of Marnock moved Amendment No. 5: Page 2, line 15, leave out paragraph (a). The noble Lord said: The Bill states: In sub-paragraph (i), after the words '32 per cent'. Subparagraph (i))relates to Section 1(5)(b) of the 1980 Act. That is the Tenants' Rights, Etc. (Scotland) Act 1980. Section I (5) of that Act states: Subject to subsection (7) below … the discount for the purposes of this subsection shall be". There is no figure 32; the figure is 33. May I have that explained? Explain away what is there. What is referred to is in Section 1(5)(b) of the 1980 Act. In that subsection the figure referred to is 33 per cent. Until that is properly explained I do not think we should allow it to go into statute.

Lord Gray of Contin

I am happy to be able to answer the noble Lord's query. Section 1(5)(b) was amended by the Tenants' rights, Etc. (Scotland) (Amendment) Act 1984.

Lord Ross of Marnock

I thought that. In fact, I think I said that, but that was not the explanation given to me by the noble Lord, Lord Gray of Contin, when he replied to my earlier remarks. Perhaps he would like to apologise now.

Lord Gray of Contin

The brass neck of the noble Lord really takes some beating! I have no intention of apologising, but I shall carefully read the record and if I have made any mistake of course I shall acknowledge it to the noble Lord.

Lord Ross of Marnock

The noble Lord sought to explain why the figure was 33. I seem to be referring to an entirely different discount. Now he has the right answer. He should have given me that answer in the first instance. That being so, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

8.30 p.m.

Lord Carmichael of Kelvingrove moved Amendment No. 6:

Page 2, line 17, after ("flat") insert ("constructed after 1919").

The noble Lord said: This is an amendment which is most important for housing associations, particularly in the large conurbations of Scotland—Aberdeen, Dundee, Edinburgh, Glasgow, Greenock and such places—where the long-established type of housing has been the Scottish tenement, practically all of which were built prior to 1919. The noble Earl, Lord Selkirk, earlier spoke about how attractive these houses are now that they have been cleared up, many of them by housing associations, and how much in demand they are. Housing association rehabilitation work is mainly carried out in areas of mixed tenure tenements constructed prior to 1919.

Housing associations themselves encourage owners to retain and improve their property. Unlike local authority housing schemes, there is an already established and often vibrant housing market in and adjacent to the areas where the housing associations are involved. In these circumstances it really seems that there is no requirement to enhance the discount for rehabilitated tenement fiats in such areas. I can speak very srongly of certain areas; for instance, the Maryhill area, and, perhaps even more importantly, the Partick area, of Glasgow where the demand for tenement property is extremely high. There is no difficulty in selling houses in this area.

Therefore, to take from the housing associations houses, many of which were provided through a great deal of voluntary effort and were built before 1919, seems to me to be unfair. It also fails to show any gratitude on the part of the Government and shows a profligate attitude with public money, since there is no difficulty in selling flats of this nature. I hope that the Minister will take this on board and agree with Amendment No. 6. With that amendment perhaps it will be convenient to take also Amendment No. 10. I hope that both will be acceptable to the Government. I beg to move.

Lord Gray of Contin

The effect of these amendments would be to deny particular groups of tenants the same discount entitlement as is available to kindred tenants living in similar properties built after 1919. I have listened carefuly to the arguments put by the noble Lord; I have to say that I consider them unacceptable. The noble Lord has pointed out that the majority of such flats will be owned by housing associations. This may be true, although it should also be remembered that some local authorities also have such tenements in their stock.

It has been argued that housing association flats are likely to have been recently refurbished and will therefore be more attractive to purchasers. This may well be the case. However, the experience among local authorities has been that flats of all types have sold markedly less well than other houses. This is not so much because the tenants do not like their flats, as because they are apprehensive about the associated responsibilities and costs—such as for common repairs—which go with the purchase of a flat. There is no reason to suppose these views will not be shared equally by housing association tenants.

But I believe that this argument is largely irrelevant. The principle of discount is a central feature of the right-to-buy scheme. The basic discount reflects the fact that the house or flat is being sold with a sitting tenant; and thereafter additional discount is granted, reflecting the tenant's tenure of publicly-funded housing. To argue that tenants living in flats built before 1919 should not be entitled to the same discount as other flat dwellers, because their flats are likely to prove more popular, is to misunderstand totally why a discount is given in the first place.

In conclusion, I do not believe that there is any case for different discounts being applied purely on the basis of whether a particular flat was built before or after 1919. The discount reflects the fact that the house is being sold with a sitting tenant and also the period of time over which that tenant has been contributing towards the cost of publicly-funded housing. I must therefore ask the Committee to reject these amendments if the noble Lord insists on pressing them.

Lord Morton of Shuna

I have difficulty in understanding the noble Lord, Lord Gray, and I wonder whether he has ever lived in one of the cities. Where are the stone tenements in Scotland built after 1919? There are plenty of council multi-storey flats and one can see why perhaps they have to be made specially attractive. But the whole purpose of the Government's proposal is to make flats more attractive so as to facilitate their sale and to make a distinction. This amendment would remove from that distinction the flats which are already attractive, which are the flats in the old tenement blocks which have been restored. It does not appear to me that the noble Lord has answered the point at all. I certainly know of no tenement flats in the style of the pre-1919 ones that have been built anywhere in Scotland since then. They are a completely different type of flat.

Lord Gray of Contin

I am sorry but I cannot really help the noble Lord very much. He suggested that he did not understand me. I thought that what I said was as plain as a pikestaff. I really cannot understand where he is becoming confused. He asked about flats built after 1919 in local authority ownership; obviously I cannot answer that question off the top of my head. I am advised that such flats exist. But it really is rather a pointless question to ask where they are at this stage of the proceedings. No doubt we shall be able to get the information for the noble Lord if the noble Lord, Lord Mackie of Benshie, keeps speaking for long enough.

Lord Mackie of Benshie

As I understood the noble Lord on the Opposition Front Bench, it was not the plainness that he was complaining about; it was the logic. His argument was perfectly plain to me: that if you knocked 10 per cent. off flats because they were not selling very well, then if you had flats that were selling very well, there was no need to knock off the 10 per cent. As a simple horse dealer that appears to me to be sensible.

Lord Gray of Contin

I am grateful to the noble Lord, Lord Mackie. Edinburgh District Council, I can inform the noble Lord, has tenements in Barony Street, Newtown, Edinburgh, built in the 1930s and other equally attractive blocks built since.

Lord Carmichael of Kelvingrove

I cannot understand the Minister. I can see his point that the whole object was to sell as many houses and flats as possible. But I believe that he is missing, and the philosophy of the Bill is missing, one of the vitally important points of our whole argument. The noble Earl, Lord Selkirk, and others from all parts of the Committee have travelled through some of these cities in the last few years and have seen the enormous improvements that have been made, largely due to enthusiasm by housing associations.

I know that a very large number of flats were built in places in Glasgow by the old city improvements department, particularly in the central part of the city, but they are now local authority houses and there are fairly big groups of them. They are very desirable houses. The Minister in the earlier Bill has his rights to sell these flats. I am sure that the inquiries will discover that the houses round about Glasgow Cross, High Street, Duke Street and George Street will go very reasonably.

What we are concerned about are the small housing associations, not those with houses of anything like the numbers that I have been speaking about; houses that the old city improvements department bequeathed to the district council. I am talking about relatively small numbers of houses built before 1919. The question of houses, stone-built houses, built after 1919, or built in the same pattern, does not arise.

I am concerned about the old-established Glasgow tenement houses which many people believe represent not a bad way of housing people because some of them are and always were of a very high standard. We are concerned with trying to preserve these houses. A worry that housing associations have is that if they have spent a great deal of money and have improved a number of houses in a block, they can then be bought by people who frequently are afraid of the cost of repair. If enough of the houses are bought, the majority then do not belong to the housing association. Therefore common repairs are difficult and planned maintenance of the houses is not possible because the ownership is so disparate. The housing associations rightly feel that the great work they have been able to do, with the co-operation of all sorts of local people, will go by the board.

If the noble Lord thinks again of some of the streets in the cities, he will realise that in the old days, even before the advent of housing associations, many of our tenements were individually owned. That was the case in my old constituency. But great problems arose over roofs, for instance, with a roof costing several thousand pounds to repair; and it was mainly a Labour Government and local authorities which put money towards repairing the roofs. Goodness gracious, had we not had so many parts of Glasgow renewed over the last 25 years, the houses would have been in an extremely bad state and we should have been much worse off for housing than we are now!

This is an important amendment. It is not asking too much. We are talking about houses that sell readily, but we feel that houses of pre-1919 construction, owned by housing associations, should be exempt from this Bill. I hope that the Minister will look again at it and think more closely before he makes too negative a response to the points I have genuinely tried to put forward tonight.

Lord Ross of Marnock

I think we are hoping to get an answer from the Minister as to whether anything has got through to him. We are not talking about houses built after 1919; we are talking about houses built before. We are trying to rescue something from the generalised power we are giving to tenants of housing association houses. The smaller housing associations in Glasgow work on these old tenements. The photographs taken before and after of these old tenement properties are worth seeing. There are just a handful of such properties.

These are the smaller housing associations and we are trying to rescue them. They know quite well that, having renovated these properties at great expense—and the Government have helped, but the labour has been given by the voluntary organisations—if they have to sell some of these rather preciously rehabilitated houses their work is going for nothing.

We are limiting our demand or request—we are almost down on our knees now—to asking for these houses to be saved. These are the houses that the noble Baroness, Lady Elliot, and the noble Earl, Lord Perth, were speaking about. There are only a small number of houses where people have to be manipulated out and then back in. These housing associations have achieved something and they see that achievement going. These houses are all pre-1919; some of them are from 1890. They are such good houses that the National Trust for Scotland has bought one in Glasgow which is now a show house.

The community housing association has rehabilitated these houses and got people into them. They are paying considerable rents for them. The associations have achieved something by keeping people in the centre of Glasgow and retaining architecturally valuable properties. That is the sole purpose of this amendment: it is limited to that. If the Minister says he is prepared to look at that, I think we would gladly withdraw the amendment. Surely his mind is not so closed that he is not prepared to talk this over with his officials.

8.45 p.m.

The Earl of Perth

Having heard the last intervention of the noble Lord, Lord Ross of Marnock, I think it would help us all if the noble Lord, Lord Gray, could tell us the magnitude of what we are talking about. When I hear it said that such things are of importance for preservation reasons, and so on, I think it is hard for the Committee to judge the merits on one side or the other without the facts. If the noble Lord would give us the information for which the noble Lord, Lord Ross, asked, that would be helpful. I understand the amendment will not be pressed if he knows that at the Report stage we shall be given further details.

Lord Gray of Contin

I am grateful to the noble Earl, Lord Perth, and I shall not keep him waiting even till the Report stage: I shall give him the information now. The noble Lord, Lord Ross, was talking about small groups of tenements and suggested that we are talking about a handful of properties. The housing association tenement stock in Glasgow is over 13,000, so—

Lord Ross of Marnock

The local authority's stock in Glasgow is more than half a million.

Lord Gray of Contin

The noble Lord must listen. I did not say the local authority: I said the housing association tenement stock in Glasgow is over 13,000. He wants to deprive those tenants of the right which is available to others. I do not, the Government do not and I am perfectly sure the noble Earl, Lord Perth, does not want to do that.

I sometimes despair when I hear noble Lords on the other side talk about people who wish to buy their houses in such terms: whenever the houses are bought they are going to be allowed to get into a state of disrepair. That is what they suggest, but nothing could be further from the truth. When somebody buys his own house he is going to take a pride in it. He is jolly well going to make sure that it does not fail into disrepair. Therefore the wholly political arguments—in disguise, I admit—which are put forward by the noble Lord, Lord Ross of Marnock, do not cut any ice. These people are entitled to the same privileges as local authority tenants. Why should we deprive them of the right to buy their houses?

No, I am sorry. I have listened carefully, as I always do, to the noble Lords, Lord Ross of Marnock and Lord Carmichael, because they are both very experienced in housing matters. They have both been Ministers in another place, and I respect their knowledge. But they also are in Opposition and they have to make their case as best they can. They have not been convincing and I cannot accept their arguments. I am sorry.

Lord Mackie of Benshie

My heart, too, bleeds for these poor people who cannot buy their houses; like the Minister's, it has bled frequently tonight. But many of these amendments are about the 10 per cent. less on flats. We are talking in some cases about the feelings of housing associations which have built up such properties and which know they are extremely attractive. They may have to dispose of them at 10 per cent. less than the price of a house, although some of the flats, particularly the older stone-built ones, when done up are more attractive. I think the Minister should look at this and at least consider the feelings of the people who do the voluntary work in these housing associations.

I know that there are exceptions. I mentioned one of them, and there is another amendment coming up concerning flats in blocks of four, which are extremely effective. I think the Minister might look at this and see whether the feelings are genuine. They are not all political; I can assure him of that.

Lord Gray of Contin

I am sure that the noble Lord is sincere, as were others, but I am afraid that I am not prepared to accept these amendments, nor to take them back, and if noble Lords insist on forcing them, then I must resist.

The Earl of Perth

May I be clear about what the noble Lord, Lord Gray, is saying? As I understand it, he said that there are 13,000 flats which were constructed before 1919. Is that correct?

Lord Gray of Contin

No. If I could explain to the noble Earl, I said that there are over 13,000 houses in the housing association tenement stock in Glasgow. I did not say, but I now say, that a great many of them would have been constructed before 1919. I do not say that all those tenements were constructed before 1919.

The Earl of Perth

I still ask the noble Lord whether he could help us with the figures on Report. If only 1,000 or 2,000 of those 13,000 were constructed before 1919, and if they were of a special quality, that makes a difference.

Lord Gray of Contin

The movers of the amendment have this matter within their power. If they care to withdraw their amendment, they can table a similar amendment on Report, but for the reasons which I have given I am not prepared to accept the present amendment. I understand that over 80 per cent. of the 13,000 were built before 1919.

Lord Carmichael of Kelvingrove

If 80 per cent. of 13,000 houses is divided among a fairly large number of housing associations, it means that each of them does not have many pre-1919 houses. If we scale the figures down in that way we realise the effort that has been made by local people in preserving, and making a valuable contribution to, the housing stock. It could not be considered to be massive. The housing is not necessarily the most important part of the contribution, but, as I said on Second Reading, that has had an effect on areas which would not otherwise have been saved.

There is a point which I must take up with the noble Lord the Minister. He was kind enough to say that the noble Lord, Lord Ross of Marnock, and myself had some experience of housing. I never had any experience of housing in government, but I claim a great deal of experience of living in tenement houses in both the East End and the West End of Glasgow. Anyone who believes that there are no problems with houses in closes which are owned by individuals does not know anything about living in tenement property. I have lived in closes where everyone owned their own houses and where getting repairs done was an incredibly difficult job. There had to be meeting after meeting because some people just did not have the money to pay for the repairs; and because the matter was divided equally between all the owners of the tenements there was no majority such as there is with a housing association, which has a majority and can go ahead with repairs and make arrangements with those who are in difficulty about meeting the cost of repairs.

It is sometimes difficult for people to find the money for repairs. Of course people are proud of their houses and do a great deal to them, but when there is a bill for anything up to £20,000 to repair a roof and there are only 12 people living in a close, a big strain is suddenly put on them. I should like to make that clear, because it is something about which I know a little. I believe that the noble Lord the Minister was, if anything, rather harsh and perhaps over-political. This is something upon which we should put down a marker. I hope that the Committee will give an opinion on the amendment. I should like to await the result of a Division.

8.54 p.m.

On Question, Whether the said amendment (No. 6) shall be agreed to?

Their Lordships divided: Contents, 29; Not-Contents, 46.

DIVISION NO. 2
CONTENTS
Airedale, L.	McNair, L.
Barnett, L.	Molloy, L.
Carmichael of Kelvingrove, L.	Morton of Shuna, L.
Crawshaw of Aintree, L.	Mountevans, L.
David, B. [Teller.]	Nicol, B.
Dean of Beswick, L.	Parry L.
Graham of Edmonton, L. [Teller.]	Ross of Marnock, L.
	Seear, B.
Hooson, L.	Stoddart of Swindon, L.
Hughes, L.	Strabolgi, L.
John-Mackie, L.	Taylor of Blackburn, L.
Kilmarnock, L.	Taylor of Gryfe, L.
Lawrence, L.	Tordoff, L.
Lockwood, B.	White, B.
Mackie of Benshie, L.	Ypres, E.

NOT-CONTENTS
Allenby of Megiddo, V.	Harvington, L.
Belstead, L.	Hooper, B.
Brabazon of Tara, L.	Kaberry of Adel, L.
Broadbridge, L.	Kintore, E.
Brougham and Vaux, L.	Lauderdale, E.
Butterworth, L.	Lindsey and Abingdon, E.
Cameron of Lochbroom, L.	Long, V.
Campbell of Croy, L.	Lyell, L.
Carnegy of Lour, B.	Margadale, L.
Cathcart, E.	Marshall of Leeds, L.
Coleraine, L.	Mersey, V.
Craigmyle, L.	Montgomery of Alamein, V.
Crathorne, L.	Perth, E.
Davidson, V.	Quinton, L.
Denham, L. [Teller.]	Skelmersdale, L.
Elliot of Harwood, B.	Swinton, E. [Teller.]
Elliott of Morpeth, L.	Trefgarne, L.
Ferrers, E.	Trumpington, B.
Forbes, L.	Vaux of Harrowden, L.
Gibson-Watt, L.	Windlesham, L.
Gisborough, L.	Wise, L.
Glenarthur, L.	Wynford, L.
Gray of Contin, L.	Zouche of Haryngworth, L.

Resolved in the negative, and amendment disagreed to accordingly.

9.2 p.m.

Lord Gray of Contin moved Amendment No. 7:

Page 2, line 17, leave out ("(42)") and insert ("(44)"). On Question, amendment agreed to.

Lord Gray of Contin moved Amendment No. 8:

Page 2, line 18, after ("(b)"), insert ("in sub-paragraph (ii), after the words "one per cent." there shall be inserted the words ", or where the dwelling-house is a flat two per cent.,";. On Question, amendment agreed to.

The Deputy Chairman of Committees (Lord Strabolgi)

Before I call Amendment No. 9, I must inform your Lordships that if No. 9 is agreed to I cannot call Amendment No. 10.

Lord Ross of Marnock moved Amendment No. 9: Page 2, line 18, leave out paragraph (b). The noble Lord said: In case anyone is worrying himself sick about Amendment No. 10 not being called, I can tell him that we discussed it along with the earlier one, which was on exactly the same point, and we do not propose to move it.

Amendment No. 9 is to leave out paragraph (b), which refers to "60 per cent." But the phrase "60 per cent." does not appear in the Act. Is the explanation the same as before, that it has been amended by a further Act? If that is the case, could we have an explanation and be told the name of the Act so that we can add it to the bundle of Acts that we need in order to interpret this Bill? I beg to move.

Lord Gray of Contin

Yes, the noble Lord is correct. This is from statutes already in force.

Lord Ross of Marnock

Yes, but which one.

Lord Gray of Contin

I shall have to check that for the noble Lord, but I think it is Section 1(5)(b)(i).

Lord Ross of Marnock

We know it is Section 1(5)(b)(i). I am reading that, but it does not mention 60 per cent.; it mentions 50 per cent. I have already suggested that this has arisen because another amending Act has been passed. I think it was a planning Act of some kind. I just want the reference to it so that we get it right somewhere.

Lord Gray of Contin

It is Statutes in Force, the Tenants' Rights, Etc., (Scotland) Act 1980, Chapter 52, and I am told that the reference of Section 1(5)(b)(i) which I gave the noble Lord is correct.

Lord Ross of Marnock

But which statute made it so different?

Lord Gray of Contin

The noble Lord is nit-picking. This is becoming like Fred Karno's army. It is the Tenants' Rights, Etc., (Scotland) Amendment Act 1984.

Lord Ross of Marnock

That is very different. The reference in Clause 2 of this Bill is: Subject to subsection (2) below, in section 1(5)(b) of the 1980 Act". The 1980 Act does not contain the words "60 per cent.". That was amended by the 1984 Act. If we had had that explanation at the start, we would all have been saved a certain amount of trouble. The Minister looked rather floundered and flustered, and he was leading a Fred Karno's army himself.

Lord Gray of Contin

The noble Lord asked the question.

Lord Ross of Marnock

If you are a good parliamentarian, you never ask a question unless you know the answer. After that persuasive reply from the Minister, of course I shall be delighted to beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 10 and 11 not moved.]

Lord Carmichael of Kelvingrove moved Amendment No. 12: Page 2, line 26, at end insert ("and that building not having more than three storeys"). The noble Lord said: This amendment is concerned with buildings no higher than three storeys.

Lord Gray of Contin

It has already been spoken to.

Lord Carmichael of Kelvingrove

This amendment was not moved previously but was merely discussed with other amendments. I hope that the Minister, if he is unwilling to accept the amendment, will give some explanation as to why he is unable to accept it. Surely this amendment has to be moved as we reach it.

Lord Gray of Contin

The groupings were agreed to, and this amendment was grouped with three other amendments and has already been spoken to. The normal procedure is that it would not be moved.

Lord Ross of Marnock

If we are taking amendments together, then the normal procedure would be for the Chairman to say which amendments are to be taken together. I presume—though nobody has said this, or nobody heard it—that this amendment goes with Amendments Nos. 4, 5, 7, 8, 9, 11, 12 and 13. That has not been put to the Committee. In any case, Amendment No. 12 has not been moved and we are entitled to move it.

The Deputy Chairman of Committees

Is Amendment No. 12 moved?

Lord Carmichael of Kelvingrove

I should like to move the amendment. Roughly the same argument applies as was put before to the noble Lord the Minister concerning smaller buildings containing four flats or fewer within them. The noble Lord, Lord Mackie of Benshie, has his signature to this amendment as well. They are homes that not only go without trouble but are also in considerable demand. I therefore hope that the Minister will give the Committee a slightly better explanation than he did in respect of the amendment we discussed earlier concerning buildings of no more than two storeys. I beg to move.

Lord Gray of Contin

Amendment No. 12 seeks to provide that tenants shall qualify for extra discount on flats but only if their flat is in a building of not more than three storeys. That would exclude from the additional discount flats in low- and high-rise blocks. But flats in two-storey blocks—commonly known as the four-in-a-block type of house—would qualify for extra discount.

I confess that in considering this amendment in advance of today's proceedings I found it a little difficult to follow. The mystery deepened on Friday when there appeared on the Order Paper Amendment No. 11 with the exact opposite effect: to exclude from extra discount flats in two-storey blocks but include all others. I concluded therefore that the noble Lord's purpose was no doubt probing.

In proposing additional discount on flats, our purpose is to recognise that the number of flats sold under the right to buy has been disappointing. That applies to flats of all types, and we do not believe that there is any distinction to be made between flats in multistorey blocks on the one hand and flats of the four-in-a-block type on the other hand. It has sometimes been suggested that four-in-a-block flats are more popular and therefore should be excluded from the extra discount. However, the figures do not support that suggestion.

Of all houses sold under the right to buy, only about 12 per cent. have been flats, even though flats account for about half the total stock. Within that total, the difference in popularity between different flat types is nothing like so strong as has been suggested in some quarters. Exact figures are not available because the figures for the stock arise from the 1981 census, whose division of house types did not match in all respects that used for sales returns. It is possible to say that about 2 per cent. of the stock of four-in-a-block flats have been sold, compared to about 1.7 per cent. of the stock of flats of other kinds, predominantly those in higher blocks.

On the basis of those figures, one could not construct a case for excluding tenants of particular kinds of flats from the extra discount provided by the Bill. In the light of that explanation, I trust that the noble Lord will withdraw his amendment.

Lord Carmichael of Kelvingrove

I apologise to the Minister, but on looking more closely at the amendment—I do not have the script but I am sure this was my fault—I find that I have there the word "not", which rather disturbs matters. I apologise to the Committee, because that changes the entire balance of the amendment. It should have read: and that building having more than three storeys". I apologise for that.

The only point I should like to make to the Minister is that I find it difficult to believe that the different types of flats sell proportionately the same, when one considers the number of high-rise flats. By the time we reach Report stage, perhaps the Minister will have some figures from local authorities that have been selling flats, to find out just what proportion of high-rise flats is involved. From my observations and the usual "vibes" one gets when moving around, one reaches the point where one finds that flats of four in a block are obviously much more desirable than most others, except perhaps in local authorities which have the old and much sought after semi-detached house.

It would be helpful if, before we part with this Bill some time in the next month or so, the Minister is able to give us the figures showing the actual breakdown, so far as local authorities know, of the number of high-rise flats and other types that have been sold. Having said that, and again with my apologies to the Minister, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

9.15 p.m.

Lord Gray of Contin moved Amendment No. 13: Page 2, line 27, leave out ("(Subsection (1)") and insert ("(Subject to subsection (3) below, in section 9A of the 1980 Act (application of Part I of that Act when dwelling-house is repurchased as defective), after the words "'30 per cent.';" there shall be inserted the words "(AA) for the words '44 per cent.' there shall be substituted the words '40 per cent.';". (3) Subsections (1) and (2)").

On Question, amendment agreed to.

Clause 2, as amended, agreed to.

Clause 3 [Amendment of date after which certain restrictions may apply as regards price fixed for purchase of dwelling-house; and extension of those restrictions]:

Lord Morton of Shuna moved Amendment No. 14: Page 4, line 4, leave out from beginning to end of line 6. The noble Lord said: The purpose of this amendment, and Amendment No. 15, is that the statutory instrument referred to in Clause 3(5) should be dealt with by affirmative resolution of the two Houses of Parliament rather than by negative resolution.

The statutory instrument is covered in subsection (4). If I understand this rather tortuous way of legislating, it deals with the date on which values are to be set; the effective date of the tenancy and matters of value, deductions from the cost of the property and therefore deductions in the extent to which the discount is allowed to be taken off. It appears to me that this would be much better dealt with by affirmative resolution, so that the matter could be discussed, rather than by negative resolution. I beg to move.

However, in moving the amendment perhaps I may take the opportunity of pointing out that Amendment No. 16 deals with Clause 4 and not with Clause 3 as would appear from the Marshalled List.

Lord Gray of Contin

I agree with the noble Lord, Lord Morton, that Amendment No. 16 deals with Clause 4. It is a mistake on the Marshalled List.

Clause 3 has two main purposes. First, it changes the cut-off date for the outstanding debt test. That is the date after which discount may be restricted if it would bring the sale price of a house below the outstanding debt on that house. In 1980, when the right to buy was introduced, that date was set in the 1980 Act at 15th May 1975, which was in fact the date of local government reorganisation. It has not been changed since. We are proposing that the date should now be moved forward three years to 31st December 1978. This is a modest change which we are satisfied will not have any adverse financial consequences for authorities but will, we believe, be welcomed as relieving them of some unnecessary work.

Secondly, the clause provides that discount may be restricted if it would bring the sale price below the debt outstanding on recent works to modernise and improve the house. Over the years we have had representations from a range of authorities that they should not he required to sell at less than the outstanding debt on modernisation works. They felt it unfair that cases might arise where a house was expensively modernised and then the authority obliged to sell it to the tenant at a discount; at a price which was insufficient to meet the debt on the modernisation works. We have accepted these arguments and the Bill provides that modernisation costs shall be brought within the outstanding debt test for the first time. I undertand that this change has been welcomed by the Convention of Scottish Local Authorities.

The Bill therefore moves forward the cut-off date by three years and extends the debt test to cover modernisation works. The Secretary of State has always had the power, under the existing Section 1(7), to disapply the outstanding debt test by order, made by statutory instrument subject to negative resolution. As a consequence of the further changes we are making, we are proposing in subsections (4) and (5) of Clause 3 that he should also have power by order to modify the operation of the outstanding debt test and to change the cut-off date.

In future, it is conceivable that it might be desirable to make further changes to the cut-off date and to the terms of the outstanding debt test. We have no immediate plans for such changes; but, if they did seem appropriate, it seems undesirable and unnecessary that they should only be able to be made by primary legislation. That is why we propose that the Secretary of State should have the power to make further changes by order.

The order-making power not only permits the terms of the outstanding debt test to be changed, including the date, but also different terms, for example a different date, to be set for different authorities. It might be felt desirable to set a different date for different housing authorities, for example, to take account of differences in the composition of their stock; or even to set a different definition of the outstanding debt in different cases. It might be, although this is perhaps less likely, that different terms would apply to different types of houses across all landlords. The clause is phrased as it is to provide flexibility, so that if an authority discovers that the terms of the test do not meet its own local situation, and if its representations seem justified to us, we have the power to make adjustments without having to resort again to the lengthy process of primary legislation.

In concluding that negative resolution was the appropriate procedure, we were also influenced by the fact that the Secretary of State already has a power, under Section 1(7) of the 1980 Act, to disapply the outstanding debt test entirely, and that power is exercisable by order subject to negative resolution procedure. An order as proposed in the present clause, which merely alters the terms of an existing test, is obviously much less drastic than one which removes the test entirely; and it would seem a little strange to make the less severe type of change subject to affirmative resolution procedure, when the Secretary of State could, if he wished, abolish the test entirely by an order subject to negative resolution.

I fear that I must apologise for trying the patience of the Committee with this lengthy explanation, but I hope that the noble Lord will now feel able to withdraw his amendments.

Lord Morton of Shuna

It was a very long explanation but it was clear and I think that even I managed to understand it. I am very much obliged to the noble Lord. However, as he explained so clearly, the new powers to make regulations cover very much wider areas than the previous powers. Under the last few lines of subsection (4) they cover powers making: different provision in relation to different areas, cases or classes of case and may exclude certain areas, cases or classes of case". I should have thought that, when one is allowing that form of wide discretion, it is much better that it should be by affirmative resolution rather than by negative resolution. But on the understanding that I may return to this point later and in the hope that the noble Lord will consider the matter further, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Morton of Shuna had given notice of his intention to move Amendment No. 15: Page 4, line 8, leave out from ("to") to end of line 9 and insert ("approval by both Houses of Parliament"). The noble Lord said: It follows that I shall not move the amendment.

[Amendment No. 15 not moved.]

Clause 3 agreed to.

Clause 4 [Secretary of State's power to give directions as to conditions in offers to sell]:

The Deputy Chairman of Committees

Before I call Amendment No. 16, I must inform the Committee that at the beginning of the insertion, owing to a misprint, the word "it" should be deleted.

Lord Morton of Shuna moved Amendment No. 16: Page 4, line 18, leave out ("appears to") and insert ("has been shown to the satisfaction of the Sheriff by"). The noble Lord said: I beg to move this amendment. This section gives the Secretary of State power, if he thinks that the inclusion of conditions of a particular kind in offers to sell would be undesirable, to give directions to landlords generally or of a particular description. This is a very wide power to give to the Secretary of State. The amendment is to make the section read: Where it has been shown to the satisfaction of the Sheriff by the Secretary of State that the inclusion of conditions". In other words, it would be for the Secretary of State to satisfy the appropriate sheriff that the particular conditions would be unreasonable. It appears to me that this would be a very reasonable condition to make because it would mean that the Secretary of State had to satisfy someone else that he was acting reasonably instead of just acting totally off his own hand. I beg to move.

Lord Gray of Contin

Clause 4 enables the Secretary of State to issue directions to local authorities and other landlords concerning the conditions which they may include in future offers to sell under the right to buy. The power is necessary for two reasons. Firstly, there have been allegations that landlords have threatened tenants with onerous conditions, in order to deter them from purchasing. We would be concerned if there were evidence that this was happening on a wide scale, and the clause will give the power to take action to remedy such abuse, saving considerable inconvenience for both purchasers and the Lands Tribunal.

Secondly, the power might be helpful to landlords. We hope that other provisions of this Bill will lead to an increase in the numbers of council flats sold. One of the problems of selling flats is the division of responsibility between landlord and new owners for service charges and common repairs. It may be that some general guidance from the Secretary of State in this area would be of help to landlords and purchasers. Before issuing directions of either type, it would, of course, be our intention to consult with local authorities.

The noble Lord's amendment proposes that, instead of the Secretary of State, the power to issue direction should be given to the sheriff. I must say that I am doubtful whether the courts would welcome this additional work. What is more, it would to my knowledge be without precedent for the sheriff to be given a general power to issue directions to local authorities let alone the public landords. Nor is it clear how the proposal is to work. Are individual sheriffs only to have power to issue directions in their own area, or are their directions to be binding across the whole of Scotland? And how are their directions to be enforced? What if different sheriffs were to issue conflicting directions? Within the realms of the court, it is not unusual to come across controversy over sentences. So what might be the result in this case can well be imagined.

It would be, I believe, a unique step to give the sheriffs power to issue directions to landlords about the general operation of the right to buy. I do not believe that such a power would be practicable. Nor do I think that it would be welcomed by the courts.

Behind this amendment, I suspect, lies a feeling that somehow the Secretary of State is taking a very remarkable and unusual power, and that he may exercise that power unreasonably. I do not accept, however, that this power is so unusual. There are other areas where the Secretary of State is empowered to issue directions to landlords on the operation of their statutory duties. In the housing field, the power to issue guidance on the Housing (Homeless Persons) Act 1977 springs to mind. Nor do I accept that the Secretary of State is likely to act unreasonably. If he were to, then there are procedures for judicial review of his actions.

In all the circumstances, therefore, I do not believe that this amendment would be an improvement in the present clause, and I hope that, on reflection, the noble Lord will agree to withdraw it.

Lord Morton of Shuna

As the noble Lord is no doubt well aware, if a potential purchaser thinks that a condition being imposed upon him is unreasonable he can go to the court or to the Lands Tribunal to get it put right. It seems to me entirely unnecessary that the Secretary of State should have to issue directions. However, in the circumstances I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 4 agreed to.

9.30 p.m.

Clause 5 [Financial and other assistance for tenants involved in proceedings under Part 1 of 1980 Act etc.]:

Lord Ross of Marnock moved Amendment No. 17: Page 5, line 21, leave out from ("assistance") to end of line 23. The noble Lord said: This is another of these unusual amendments. Why should I do work that the Government can do for me? Clause 5 states: After section 9A of the 1980 Act there shall be inserted". I look for Section 9A of the 1980 Act and, surprise, surprise, there is no Section 9A of the 1980 Act. I presume therefore that this is in another amendment somewhere.

This point draws the attention of the Committee to the impossibility of easily understanding this Bill and its meaning. It may well be that the Government barely have time to read the briefs, and do not read them terribly well. I do not blame them for that because the lighting has become dim and I can understand the difficulties in reading the briefs. But for an Opposition, without a Civil Service behind them, to try to understand these matters is shatteringly difficult.

I am concerned that the Government are providing the power that the Secretary of State shall, on written application to him by the tenant or purchaser give financial or other assistance … if the Secretary of State thinks fit to do so", and if the applicant is involved with a local authority or a housing association. The clause provides the power to give financial help and other assistance.

The clause states: Provided that assistance under this section shall be given only where the Secretary of State considers—> (a) that the case raises a question of principle and that it is in the public interest to give the applicant such assistance"— I should like an explanation of the following words— or (b) that there is some other special consideration". Who will determine the other special consideration? Is it once again the Secretary of State? Can we be given any indication of what the other considerations are likely to be?

With regard to legal proceedings we are loading the dice on one side. We have already heard about the difficulties and how undesirable it is that the Government should give tenants money. But here they will give them money and assistance in a legal battle against the landlord. Can the Minister let us know what is in the Secretary of State's mind? Can he tell me what happened to Section 9A? Where did it come from? Where did it go? I beg to move.

Lord Gray of Contin

Clause 5 gives the Secretary of State power to assist tenants or purchasers who may be involved in legal action against their landlords on matters concerning the right to buy, but only if the case has special features; for example, because it raises a question of principle and it is in the public interest that the tenant should be given assistance.

The clause is not a general power for the Secretary of State to get involved in litigation between tenants and their landlords on individual house purchasers. Where disputes of this type arise there are adequate remedies in the Tenants' Rights Act 1980 and at common law. There can be cases, however, which give rise to issues of principle, concerning the interpretation of the Tenants' Rights Act 1980 and where possibly tenants might be unwilling to proceed without assistance; for example, because they do not qualify for legal aid and are concerned about the possible costs. In those circumstances the Secretary of State may judge it in the wider interest that the case should proceed in order to have the principle which is in dispute resolved. It may be that he would judge it necessary to give assistance to the tenant in order to bring this about. Clause 5 gives the Secretary of State a reserve power, therefore, to intervene in these limited circumstances.

The clause inserts a new Section 9B into the 1980 Act. Section 9A was inserted by the Housing Defects Act 1984, Chapter 50. I shall refer to the matter later. Section 9B(1) sets out the power of the Secretary of State to give assistance, provided he considers either that the case raises a question of principle or that there is some other special consideration. The words, "some other special consideration" provide, as it were, a safety net because we cannot at this stage predict all the circumstances in which the Secretary of State might judge it necessary to exercise this power.

I have described the main circumstances in which we think it likely that the power would be used, and I have emphasised that it is a reserve power which the Secretary of State intends to use sparingly. The important point is that the case should have special features, in the sense that it raises a matter of public interest, or has some other special consideration. This is a fairly standard phrase and I do not think that there is anything sinister to be read into it. If Members of the Committee are interested in precedents, then they will find closely similar wording in both Section 75 of the Sex Discrimination Act 1975, and Section 66 of the Race Relations Act 1976; both excellent pieces of statute which were, as I recall, introduced when the noble Lord was in office.

Subsection (3) lists the type of assistance which the Secretary of State may give. We envisage that this would most likely take the form of financial assistance. But provision is made so that the Secretary of State may give assistance in the form of arranging for legal representation for the applicant, possibly in the form of advice, which could be advice from his own department. It seemed to us sensible that the forms of assistance which might he given should be drawn fairly widely.

I hope that, in the light of my explanation, the noble Lord may be prepared to withdraw his amendment.

Lord Ross of Marnock

The noble Lord eventually came round to giving an explanation of the words: or (b) that there is some other special consideration". As I understand it, his explanation is that there may well be some other special consideration. In other words, he just repeated the words that are already in the Bill and for which I sought a justification. However, he then tells me that they are well-founded; they are in the Sex Discrimination Act 1975 and the Race Relations Act of, I think, 1979. The noble Lord said that I should know about them because I was in office at the time. With all due respect, I was not in office as regards the second Act. It might have seemed like it, but I was not in office. I do not think that there is very much to justify a comparison with the powers given to somebody else—not to the Secretary of State for Scotland—in either of the Acts, whether or not I was in office.

We are discussing a very considerable power. As I have said, I can understand it if there is something which is fairly obviously a matter of principle. There may be defective drafting in this particular Bill. I would not be the slightest bit surprised if there were defective drafting in the Bill. It will he for the courts to sort out the matter, and the Secretary of State would naturally want to come in on the side of the person who thinks—and who the Secretary of State has led to think—he has a right to buy. However, with all due respect, the phrase, "other special consideration" is rather vague. When it involves the Secretary of State taking sides in a legal battle, we require a little more justification than we have had at present.

I understand the difficulties of the Minister of State in this regard. This is not a subject in which he is well versed; and it may fall much more in the field of the noble and learned Lord the Lord Advocate, rather than the Minister of State. It may well be that at another stage he will be able to give us a better explanation than he has given today. Quite frankly, he has not given us any at all. He just repeated the words that are there. I should have thought that perhaps he might have been able to produce something new.

It is not good enough to have this so-called safety net where no one is ever going to be able to do battle against the Secretary of State and win. He has this safety net where he can come in with all the power of the state against somebody who is being beleaguered. It may well be one of these small housing associations in Glasgow, in Edinburgh or somewhere else in Scotland, and it may find that instead of one of the tenants it is up against the Secretary of State. It is not good enough to put this in just like that and say, "Well, it is a safety net". A safety net for whom? It is a safety net purely for the Secretary of State.

We should have left it in the first instance that "the case raises a question of principle and that it is in the public interest to give the applicant such assistance". After all, even in that definition, whch we are prepared to accept, it is the Secretary of State who decides that. I do not think that we have had an adequate explanation yet of this line and a half of print.

The Deputy Chairman of Committees

Is the noble Lord withdrawing his amendment?

Lord Ross of Marnock

Not yet. If there is no explanation forthcoming, I can only presume that there is no explanation. If there is no explanation, then the words should not be here. We are prepared to be persuaded that the Government are right, and yet we get no words at all from them. This is new to Scottish legislation. We have not got such a safety net yet for the Secretary of State. If we let it in this time we shall get it in legislation time and time again, and they will be referring back to the Housing (Scotland) Act 1986, which the House accepted with acclamation; without objection.

There will probably be some objection. If the Minister cannot give me an explanation now, I am prepared to withdraw the amendment and put it down for the next stage of the Bill. That will give him time to get on with it, and I hope that the light will be better so that he will be able to read it a bit better when we get that explanation. In the meantime, it is obvious that I shall need to withdraw the amendment.

Lord Hughes

Before my noble friend withdraws his amendment, as I gathered he said he might do, may I say that these words, which are preceded by the word "or", would seem to indicate that the provision is intended to deal with a matter which is either a question of principle or in the public interest? The very least that the Minister should do is to give an undertaking to my noble friend that he will show how these words can be applied in a way which includes both the public interest and a matter of principle. At the moment it sounds as if it is an alternative.

Lord Gray of Contin

I can clearly see what noble Lords opposite are trying to do. However, I shall try to explain again for their benefit a little more slowly and a little more clearly in the hope that they will understand. The clause inserts a new Section 9B into the 1980 Act.

Lord Ross of Marnock

That we know.

Lord Gray of Contin

It did not sound from what the noble Lord said that he did. If he knew, he certainly did not understand. Subsection (1) sets out the power of the Secretary of State to give assistance.

Lord Ross of Marnock

It is nothing to do with subsection (1).

Lord Gray of Contin

If the noble Lord wants to make yet another speech, I shall give way to him, but muttering there from a sedentary position is no help to anybody.

Lord Ross of Marnock

The amendment is to leave out certain words. It has nothing to do with subsection (1). It has nothing to do with subsection (1)(a). It is related purely and simply to the words: or (b) that there is some other special consideration". That is all. I want an explanation just of that. I know what subsection (1) says, and I agree with it. I know what it says in subsection (1)(a), and I am prepared to accept that. I am asking for an explanation purely and simply of the words, that there is some other special consideration". and nothing else.

9.45 p.m.

Lord Gray of Contin

The noble Lord has already had that explanation, where I dealt specifically with the words "some other special consideration" providing, as it were, a safety net. That is a term which the noble Lord did not like, but it is not unusual to have a safety net of this kind in legislation, as the noble Lord knows perfectly well, because nobody can predict at this stage all the circumstances in which the Secretary of State might judge it necessary to exercise this power. It is for that reason that that form of wording is applied.

I described the main circumstances in which we think it is likely the power would be used, and I emphasised that it is a reserve power which the Secretary of State intends to use sparingly. I then went on to explain that the important point was that the case should have special features in the sense that it raises a matter of public interest or has some other special consideration. I should have thought that what I have explained was really self-evident. What I have said covers the situation where special circumstances may arise which are not covered by subsection (1)(a) but where the Secretary of State may nevertheless judge it appropriate to assist.

I have made that as clear as I think it is possible to make it, and I cannot give the noble Lord any more explanation than that. In view of what I have said, I hope he will now be prepared to withdraw his amendment. Whether he returns to it at a later stage must be for the judgment of the noble Lord.

Lord Hughes

In putting myself in danger of being regarded by the Minister of State as being of inferior intelligence, which was what he seemed to imply, I asked him a question, and he has not answered it. My question was: Does "that there is some special consideration" mean that a question of principle has not arisen, or that it is not in the public interest? Normally if the one is going with the other the word joining them together would he "and", not "or". The word "or" is an alternative. What is the answer to that? If it is necessary for me to repeat it and keep on repeating it until he gets the relevant note, I am quite happy to do so. In the hope that what he has now been given will enable him to answer the question, I shall sit down.

Lord Morton of Shuna

If I can also add myself to those whom the noble Lord, Lord Gray, considers cannot understand what is written, surely the Secretary of State is only interested, or should only be interested, in this matter in questions of principle which are in the public interest. If something is not a question of principle and not in the public interest, what special considerations are there which would justify the Secretary of State doing anything?

Lord Gray of Contin

I am sorry, but I really am not going to bore the remainder of the Committee by going over yet again what "some other special consideration" might be. I have explained it twice already, and if noble Lords are not prepared to accept that explanation all I can suggest to them is that they read Hansard tomorrow and study this again, because it is crystal clear.

Lord Hughes

It will not make a halfpenny worth of difference reading it tomorrow. The Minister of State is refusing to tell us whether in applying (b)—there is some special consideration—it does not cover a matter of principle or it is not in the public interest. All I am asking is: does he mean that the special consideration must be in addition to the matter of principle, or in the public interest; or can it apply when either one or both of those does not apply? Can he answer that now? He has had at least three notes from the Box. Surely they at least are capable of providing an answer to a question.

Lord Gray of Contin

The best I can do is to supplement the great amount of information which I have already given to him. I am not suggesting anything about the noble Lord's intelligence; he did this job and I remember him doing it very well indeed, so he must not feel so sensitive. If he feels sensitive he should sit here for a while.

Lord Hughes

I should be delighted, provided that noble Lords presently there had left.

Lord Gray of Contin

This provision could allow the Secretary of State to assist in cases that do not give rise to issues of principle but have other considerations. It is not only issues of principle. It could apply where other considerations occur. I have already spelt out those other considerations loud and clear. I have answered the noble Lord's point, I think.

Lord Hughes

At last!

Lord Gray of Contin

At last?

Lord Hughes

I thank the Minister for confirming that.

Lord Ross of Marnock

In view of that lengths and repeated explanation that took us nowhere, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Ross of Marnock moved Amendment No 18: Page 5, line 34, leave out paragraph (a). The noble Lord said: The purpose of this amendment is to leave out "giving advice" from line 34. All I want to know is this. I do not want the whole clause explained at this late hour of the night. All I want is an explanation of "giving advice". We are talking about legal proceedings.

Lord Gray of Contin

I am grateful to the noble Lord for giving way, but this is the point that we had earlier. This is part of an agreed grouping. This amendment has already been spoken to with an earlier amendment.

Lord Ross of Marnock

Nobody said a word about this amendment. Nobody said a word about the last amendment that the Minister queried. Amendment No. 4 was the head of the group and the person moving that amendment should have said that we were discussing this along with the other eight or nine.

Lord Gray of Contin

I did.

Lord Ross of Marnock

No, with due respect the Minister did not mention any of the others at all. I have a good memory for what is said or not said, even when it is said from a sedentary position and even when it is not reported in Hansard.

I should like to know what kind of advice the Secretary of State will give. It is not usual for the Secretary of State to give legal advice and it must be legal advice of some kind when he is intervening in legal proceedings. It might be non-legal language; it might be very rude language, but we should remember that we are dealing only with special circumstances.

I should have thought that the best thing for the Secretary of State to do would be to get in touch with his law officer and pass over the giving of advice on a legal matter to a legal department. I know that there are lawyers in the Scottish Office, but I do not think this is desirable. I should have thought that the place for advice to be given is under legal aid, rather than for the Secretary of State to give all this under (a), (b), (c), (d) and (e).

This is strange, but I do not see why giving advice, separate from arranging for the giving of advice or assistance by a solicitor or counsel should be specially mentioned. I beg to move.

Lord Gray of Contin

Subsection (3) lists the type of assistance that the Secretary of State may give. We envisage that this would most likely take the form of financial assistance, but provision is made so that the Secretary of State may give assistance in the form of arranging for legal representation for the applicant, possibly in the form of advice which could be advice from his own department. It seemed to us sensible that the forms of assistance which might be given should be drawn fairly widely.

Again, there is nothing sinister in this and similar wording will be found in both the Race Relations Act and the Sex Discrimination Act to which I referred earlier. It could be legal advice but that would more likely be covered by subsections (3)(c) or (3)(d). Advice under subsection (3)(a) might be in the form of, say, maps or other information which the Secretary of State has in his possession. That is the purpose of subsection (3).

Lord Ross of Marnock

Bearing in mind that this is something of high importance, raising a question of principle or some other unspecified special consideration, I should have thought that maps would hardly enter into it. I just cannot see it. I think we had better return to this. I suggest that the Government look at this and also at paragraphs (a), (b), (c), (d) and (e). In the meantime, I shall withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 agreed to.

Clause 6 [Information from landlords in relation to Secretary of State's powers under Part I of 1980 Act]:

Lord Morton of Shuna moved Amendment No. 19: Page 6, line 36, leave out subsection (2). The noble Lord said: This amendment is to leave out subsection (2) of Clause 6. This subsection says: Any officer of the landlord designated in the notice"— that is the notice given by the Secretary of State— for that purpose or having custody or control of the document or in a position to give that information shall, without instructions from the landlord, take all reasonable steps to ensure that the notice is complied with".

That may be all right for a local authority; but has the Minister really considered what happens in a housing association if the provision refers to "any officer of the landlord"? Who—the office boy? What is going to happen? Surely an organisation such as a housing association, a committee in effect, has to have some power of deciding whether to comply or refuse to comply and seek judicial review. It is a very wide-ranging power to say that an officer, any officer, chosen apparently by the Secretary of State in his notice, shall have to do things without reference to his employers. It is a very wide, deep power and there seems to be no necessity for subsection (2). I beg to move.

Lord Gray of Contin

Clause 6 gives the Secretary of State a power to require information from public landlords, where it is necessary in relation to the exercise of his power under Part I of the 1980 Act; that is, under the right to buy. This power is necessary in consequence of Clauses 4 and 5 of this Bill. Clause 5 of the Bill gives the Secretary of State power to give assistance to tenants involved in court proceedings. However, before deciding whether it would be appropriate to exercise this power, it may well be that the Secretary of State will require to obtain certain information from the landlord. Clause 4 of the Bill provides that the Secretary of State may give directions as to conditions included in offers to sell. Again, it may be necessary for the Secretary of State to obtain information from landlords concerning such offers, in order to decide whether it would be appropriate to issue directions.

Subsection (2) provides that any officer designated in a notice served by the Secretary of State and who is in a position to give information shall, without instructions from the landlord, take all reasonable steps to ensure that the notice is complied with. I regret that this provision is necessary. We have, however, had experience of a council withdrawing from its officials the delegated authority to complete, certify and submit returns required by the Government under statute. Subsection (2) is intended to avoid the possibility in future of a landlord engineering a confrontation with the Secretary of State by directing staff not to comply with a notice served under this clause.

10 p.m.

An individual officer of the landlord authority will be placed under a clear statutory duty to comply with the requirements of such a notice. The officer named would be likely to be a senior officer, such as a director or a chief executive. It would be unlikely that the Secretary of State would specify an office boy, as the noble Lord suggested—but I realise that he was just highlighting the point he was trying to make. That is the situation. It is sad that we need such a requirement, but I have explained the background to it and I hope that in the light of that explanation the noble Lord might be prepared to withdraw the amendment.

Lord Ross of Marnock

It is a very serious power indeed and I have no doubt that failure to comply with it will carry penalties. The Government already have powers to deal with local authorities and I would be very surprised indeed if they had not powers to deal with a defaulting local authority in this respect, or any other.

It is really an extension of their power to go ahead and get round an unwilling authority, be it a housing association or a local authority, by designating any officer in the notice. I do not know whether the Government will be absolutely right about that. They could nominate someone whom they thought was in control, but he could be easily removed from control. The Government could say, "Well, he was in control but he is no longer. He still has to do what we tell him and give us information behind the back of the local authority"—and it may well be against the will of the local authority.

It is much more likely that the Government will be able to say, "This man has information and he must divulge that information to us". What happens if the man says, "I have not got the information", or, "I have forgotten the information"? What are the penalties? This is a new and serious power—to go behind the back of a local authority to an officer of that authority who may or may not have the information. He is much more likely to have information but not to have actual control of the documents.

I am not entirely happy that the Government need to take this power. I am perfectly sure they could do it in some other way, directly with the local authority, rather than descend to the business of naming an individual who is a municipal servant or a servant of the housing association. I think it is deplorable. It may be all very well for the Minister of State to say that it has happened with one local authority. I do not think it has happened in many cases among all the authorities and among municipal servants sufficiently to justify this action, bearing in mind that I am perfectly sure the Government have got other powers. They may not be quite so handy and they may not be quite so easy to wield as this new power that is given; but I think there is a considerable danger in taking this kind of power, particularly in respect of individuals. I think it is a grave departure from our usual relationship with municipal servants that they should be submitted to this kind of situation. I hope the Government will think again about it.

Lord Gray of Contin

I note what the noble Lord has said. As he pointed out, he is quite sure that the Secretary of State has other powers which he could use so far as this is concerned. That is quite true. The Secretary of State already has the power under Section 199 of the Local Government (Scotland) Act 1973 to require authorities to give him information. That power, however, is limited to local authorities and would not cover housing associations. The new power under Clause 6 goes wider in that it extends to all right-to-buy landlords. At the same time, it is more limited in being confined to matters arising out of the right-to-buy provisions. The noble Lord is right. There is that 1973 Act power, but that would cover only local authorities. I hope that I have explained that point.

Lord Morton of Shuna

It is unsatisfactory legislation even if it is necessary. What do you do if you are the employee of a housing association and you are told that you will get the sack if you comply with the order? What sanction does the Secretary of State have? There is no penalty under the Bill. It is unusual to place an obligation on someone to obey the law when there is no penalty. Is the housing association or the individual to be fined? We can deal with the local authority under the 1973 Act but there is no penalty here. The noble Lord would be better to take away this clause and consider where it is leading.

Lord Gray of Contin

If a named person cannot comply because he genuinely does not know, he cannot be in default of the statutory requirement.

Lord Morton of Shuna

What happens if he is in default? Where is the penalty? It is unfortunate that when the Secretary of State has power to issue orders anyone in Scotland can defy him because no penalty can be imposed. It is odd legislation.

The Deputy Chairman of Committees

Is the noble Lord withdrawing the amendment?

Lord Morton of Shuna

I was hoping for an answer. Is there any penalty on the defaulting officer who is not employed by the local authority?

Lord Hughes

While the noble Lord the Minister is waiting for the requisite information to be transmitted across the Floor, perhaps I may ask him a question on a different point. The words that present me with difficulty are: without instructions from the landlord". What is obviously intended by what the noble Lord the Minister said is that the officer concerned does not have to seek instructions from the housing association about giving that information. What happens if when he receives the order he is in possession of instructions from the landlord which are, "Do not give this information"? Does that person have a get out if he can say to the Secretary of State, "But I am not without instructions from the landlord"?

Lord Gray of Contin

The point which the noble Lords, Lord Hughes and Lord Morton, have made is open to question. There is no power against an individual. The power would be against the authority. I am prepared to take back this point and look at it, as suggested by the noble Lord, and we can perhaps return to it at a later stage.

Lord Morton of Shuna

It is always surprising but pleasant to have some sign of movement from the other side. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 6 agreed to.

Clauses 7 to 11 agreed to.

Schedule 1 [Amendment of 1980 Act]:

The Deputy Chairman of Committees

Before I call Amendment No. 20, I must inform your Lordships that there is a misprint in the wording of the insertion which in line 4 should read "of" instead of "if". I am also bound to say that if Amendment No. 20 is agreed to, I cannot call Amendments Nos. 21 or 22.

Lord Morton of Shuna moved Amendment No. 20: Page 21, line 51, leave out from beginning to end of line 12 on page 22 and insert—

1. (" (i) the rules of the landlord, registered in terms of section 9 or 10 (registration of rules) of the Industrial and Provident Societies Act 1965, are such as would admit of a claim for, and a grant of, exemption from tax under section 360(1) of the Income and Corporation Taxes Act 1970 (special exemptions for charities); and
2. (ii) such exemption has been granted (whether or not retrospectively) and is in force; or")

The noble Lord said: I understand that on the groupings—and perhaps for the first time the groupings had better be mentioned, for we did not hear the noble Lord, Lord Gray, mention Amendment No. 4 when he was speaking to various others—I am supposed to be speaking to Amendments Nos. 20, 21 and 22. These amendments come at a very late stage, and it is very unfortunate, when the Committee is sitting late, that this crucial series of amendments should be dealt with at this time.

For some reason the Bill provides that charitable status should apply to housing associations only if they had charitable status from 3rd October 1980. The reason for that date is unclear. Presumably, it is the date of the order bringing in the Tenants' Rights, Etc. (Scotland) Act, which did not apply to housing associations anyway, so its purpose is vague. There is no reason why a charity formed on 4th October 1980 should not get the same benefit as those formed earlier.

There are charities which have been re-arranged since, and, therefore, will not get the benefit. For example, the Servite Housing Association operated long before 3rd October 1980, but it promoted a separate Scottish association which took over its property. It is clearly a charitable organisation. If the parent had not formed a separate Scottish association, its Scottish property would be exempt. But just because of the separation its property is now not exempt. The Kingdom Housing Association was formed before October 1980, but was not registered until after that date. The same situations apply with the Edinburgh association, the Grassmarket Housing Association, to which the noble Lord, Lord Mackie of Benshie, has spoken, because this became charitable after October 1980.

Why is this date chosen? What is the opposition to Amendment No. 21, which would make subparagraph (i) read, the landlord has claimed and been granted … under section 360(1) of the Income and Corporation Taxes Act … (special exemptions for charities)"? What is wrong with that? What is special about 1980?

Similarly, another way of approaching it would be by Amendment No. 20, under which an association's rules are such that it is admitted to exemption from tax under the Act. Amendment No. 22, in the names of the noble Earl, Lord Selkirk, and the noble Earl, Lord Perth, leaving out "3 October 1980," is to the same effect. We have had no explanation as to why 1980 is chosen. I beg to move.

10.15 p.m.

Lord Gray of Contin

I think I might come in at this stage, because what I have to say on this amendment may be helpful to the Committee at this late hour and save time in dealing with this amendment. The excellent work done by the housing associations which operate as charities in Scotland is recognised on all sides of the Committee, and it has been suggested that this work might be impaired by the provisions of the Bill.

Exemptions from the right to buy have to be very carefully considered. When it was brought in in 1980, housing association tenants were excluded because of fears that the development of the housing association movement in Scotland, then not long out of its infancy, might he harmed.

Six years on that is not the case. Now we are extending to tenants of housing associations rights that have been enjoyed by their public sector neighbours for many years. And here is the crux of our present difficulty. There is no reason why tenants of housing associations, which are in most other respects very similar to their local authority tenant neighbours, should be excluded from the right to buy simply because of the constitutional nature of their association. We are therefore concerned to ensure that the right to buy is extended to as many people as possible while, at the same time, protecting the stock of houses required for special needs. However, we recognise that some associations in Scotland that operate under charitable rules and have charitable tax status have considerable stock of both kinds, were set up in a way which did not allow for the introduction of the right to buy, and would now be placed in difficulty if the right to buy were applied to them.

For those reasons the Bill now exempts from the right to buy associations that were formed on a charitable basis and have enjoyed charitable tax status since 3rd October 1980. Amendment No. 20 would, in its first part, remove the requirement that an association should have formed under charitable rules and would allow associations to change their status to that of a charitable association at any time. Clearly that has potential as a device to avoid the right to buy and is unacceptable. Any association that has any serious intention of operating in the charitable field will have formed itself with rules appropriate to that function. Associations that form in the future to carry out some function for which charitable status would be appropriate will almost certainly be operating in the field of special needs and here, as your Lordships' Committee knows, special needs stock is exempt in its own right.

The other two amendments proposed by the Opposition Benches and my noble friend would remove the requirement to have obtained charitable tax status by 3rd October 1980. We recognise that that requirement is probably more restrictive than it need he and a small number of associations that formed with charitable rules but did not approach the tax authorities until some later date have been unnecessarily excluded.

In addition, there is a similar small number of associations again having formed with charitable rules which may not even now have approached the tax authorities but may be able to gain tax exemption on a retrospective basis as provided for in the Bill. We therefore have it in mind to bring forward at Report stage an amendment to alter the date for tax status from 3rd October 1980 to 14th November 1985, the date of introduction of the present Bill. We believe that that amendment, if agreed to, would admit a further four associations to the exemption from the right to buy and enable the others who have as yet not considered their tax status to review their position.

It is not easy to see that any further easing of the requirements for exemption from the right to buy for charitable housing associations is necessary or desirable. Associations that we would all regard as having worthwhile charitable objectives do so because they are dealing with the housing of less favoured members of society and for them it is the nature of the stock that determines their exclusion from the right to buy. The present form of the exemption, taking account of both charitable status and special needs stock, is likely to exempt more than 14,000 tenants from the right to buy out of a total housing association stock of some 37,000. Many people whose landlords are housing associations with charitable status will already feel aggrieved that their rights have been taken away simply because of the legal nature of their landlords; I doubt that any wider exemption would be acceptable to such tenants.

I invite noble Lords on both sides of the Committee to withdraw their amendments on the understanding that I will bring forward an amendment of the type that I have promised at Report stage.

Lord Taylor of Gryfe

I have here a brief from the Scottish Federation of Housing Associations. One comment which it makes concerns exemption. I am delighted to hear that the date is to be amended on Report. However, the association makes the very strong point that charitable housing associations which are registered in England and Wales but which operate in Scotland will be exempt. Because of the incompatability of Scottish legislation with English legislation this suggests that an anomaly will arise. Is this true, or will this also be taken care of when the Minister looks at the dates for exemption prior to the Report stage?

Lord Hughes

What the Minister has just said is very important but until we see the nature of the amendment we do not know how valuable it will be. It would not be much use to us to receive details of the amendment only two or three days before Report stage. Will the Minister therefore accept that it is desirable—indeed, more than that, it is absolutely essential—that those of us who are particularly interested in the housing association movement should have ample opportunity to look at the amendment to work out its effect on associations before we are asked to divide on it?

Having said that, I must declare an interest. I am president of the Scottish Federation of Housing Associations. The noble Lords, Lord Mackie of Benshie and Lord Campbell of Croy, are both vice-presidents of the federation. I am certain that we should be placed in a impossible position if the federation were to phone us, for example, the day before we are to vote on the amendment to say that it had just learnt of the amendment and to give reasons why it felt that it is half a loaf but better than no bread, or that is is desirable or that it is rotten.

I am not asking that the Minister give this information specially to the noble Lord, Lord Mackie of Benshie, and myself but that it should be published early enough for all who are interested in the matter to have the opportunity to discuss it if necessary. Will the noble Lord undertake to do that?

The Earl of Perth

What we have heard from the noble Lord, Lord Gray, is very important. However, I am not entirely happy that it goes as far as he wants. I say that because, as I understand it, there will still be a difference between the practice in England and Wales and the practice in Scotland, If that is right, I wonder why.

At Second Reading the noble Lord, Lord Gray, said: it is wrong to suggest that the Bill prevents the formation of any new charitable housing associations in Scotland".—[Official Report, 18/3/86; col. 946.] With great respect, even on the basis that the noble Lord has told us there is to be an amendment on Report, that statement is wrong. How can I form a new charitable association for housing if I know that shortly afterwards (the date we were given is 14th November and "shortly after" may be five or six years) the tenants will have the right to buy and that they can buy at a considerable discount?

If I understand charitable law correctly, I think that means that the Inland Revenue would not accept that it was a charitable body. Therefore, as I read this, we are still not where we want to be. In England and Wales charitable housing associations, without any cut-off date, are allowed to carry on, whereas in Scotland that is not to be the case. I do not see the reason for that. I am afraid that the noble Lord is not right when he says that it is wrong to suggest that the Bill prevents the formation of any new charitable housing associations in Scotland for the reasons that I have given. While I am delighted that he will take this amendment away and help in a considerable degree, I beg that he will go even further if the points I have made are correct.

Lord Mackie of Benshie

I shall not detain the Committee for very long. I appreciated the Minister's arguments that any new charitable organisation would indeed almost certainly be formed for some special purpose and have some special equipment or special buildings which would exclude it from the necessity to sell houses under the Act. But it is quite possible, and in fact entirely probable, that some proper charitable association could be formed that had houses which did not conform with the regulations required to put them outside the Act. Therefore, I welcome his promise to look at this point again. I think it is necessary that he should look at all aspects of the matter, because it is a very imporant point and the anomalies between Scotland and England are quite unbearable, particularly where charities may operate in both countries.

Lord Morton of Shuna

I think that the best thing I can do is to withdraw these amendments at this stage and wait and see. I must say that I think there are difficulties in the date of publication of the Bill. It may be that it should more properly be the date that the Bill is passed, because that might be more suitable.

There is also a difficulty with the type of charitable housing association that one hopes will be formed in the future, for example, to accommodate people coming out of mental hospitals at their half-way stage, where the whole purpose is that they should be living in ordinary housing with ordinary people. If ordinary people are to have a right to buy, it rises a very great difficulty in that kind of charity running its organisation. But at this stage I beg leave to withdraw the amendment.

Lord Gray of Contin

Before the noble Lord withdraws his amendment, one or two points were raised which perhaps I may answer. The noble Lord, Lord Taylor, asked me about housing associations which are registered with the Charity Commissioners in England. Housing associations which are registered with the Charity Commissioners in England will be exempt from the right to buy in Scotland, to ensure that each single association is treated in the same way both north and south of the Border.

The noble Lord, Lord Hughes, asked me about the timing of the amendment. The amendment will substitute "14th November 1985" for "3rd October 1980" and it is doubtful whether any consequentials will be necessary. However, I have taken note of what the noble Lord has said and I shall see that officials table the amendment in as good time as possible.

The noble Earl, Lord Perth, suggested that the amendment would prevent the formation of new charitable associations in Scotland. It is true that any new charitable association in Scotland would lose its charitable tax status if its stock were eligible for the right to buy, but associations whose stock is for special needs—and most new charitable associations will be in this category—will have their stock exempt for that reason; in other words, by virtue of the physical features of the houses.

The other point raised by the noble Lord, Lord Morton, and other noble Lords was that Servite comes into the exemption under the concession that I shall be making. I thank the two noble Lords for their albeit qualified acceptance of what is on offer. I cannot expect more because they will have to study this issue and see the amendment. I am grateful to the noble Lord, Lord Morton, for agreeing to withdraw his amendment.

Lord Morton of Shuna

Now that I have permission to do so, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 21 not moved.]

10.30 p.m.

The Earl of Perth moved Amendment No. 22: Page 22, line 1, leave out ("from 3rd October 1980,") The noble Earl said: I wish to move the amendment, although I shall afterwards withdraw it, because I remain unhappy about the remark of the noble Lord, Lord Gray of Contin, that most charitable organisations would qualify for different reasons. Why only "most"? Why not all? Why are we in Scotland to be treated in a different manner to England? Why should there exist an anomaly whereby, if I start a charitable housing association in England, set up one house there and then devote all my attention to Scotland, I get away with it? I hope that the noble Lord, Lord Gray, will look at this in the broad and realise that it is not enough simply to have a date. Let us get rid of the date! Let us accept that charitable housing associations, be they in England, Wales or Scotland, all enjoy the same advantage. Without that, for the reasons given by several noble Lords, we are in a mess. A great deal of unhappiness will be caused. We shall not be able to set up new charitable housing associations in Scotland, and that will not do. I do not know whether anyone else wishes to make a comment on the amendment, but before withdrawing it, I shall wait and see.

The Deputy Chairman of Committees

Is the noble Earl moving the amendment? He spoke to it earlier but he has not moved it.

The Earl of Perth: I am sorry. I move Amendment No. 22.

The Earl of Dundee

I should like to support the remarks of the noble Earl, Lord Perth. There are surely two important reasons why the existing draft regarding charitable status should be amended. First, there is the case in itself already recognised and already the law in England and Wales that properties of associations which are charities should be exempt from the right to buy. Secondly, there is the need to prevent the anomaly whereby this is now accepted in England and Wales but would not be in Scotland except in regard to associations that had existed before October 1980, although, as my noble friend the Minister now says, there would be a different and more generous date.

There are obvious differences in overall numbers and in percentages of association charities between Scotland and England. Arising from a comparison, it might always be that the useful purpose and functioning of Scottish housing associations would not necessarily appear to suffer as and when Scottish association charities were depleted in number. However, would my noble friend the Minister not agree that arising from such a comparison, the reverse is in fact the position? The different numbers and proportions in Scotland would surely suggest that it is sensible to exempt housing association charities even if England and Wales had not done so. Conversely, there is surely all the more reason for so doing, given that England and Wales have now done so.

Lord Gray of Contin

The noble Earl, Lord Perth, asks for the date to be done away with and for all charities to be exempt. I am afraid that this cannot be done. To make such a broad exemption would open the way to what would be no more than a device to avoid the right to buy provisions. The whole objective of the legislation is to make sure that the right to buy provisions are extended to tenants of housing associations in the same way that they are, and have been, available to local government tenants. We have been talking about that matter all evening.

In England, the stock of housing is basically special need. Therefore, by virtue of its type, it is exempt. This is why I said to the noble Earl, Lord Perth, and I repeat to my noble friend Lord Dundee, that it is true that any new charitable association in Scotland would lose its charitable tax status if its stock was eligible for the right to buy. But associations whose stock is for special needs—and almost all of them would be in this category—will have their stock exempt for that reason. That is by virtue of the physical features of the houses. That would exempt them.

But the noble Lord is correct that the amendment I shall make will not apply across the board. But it will extend very substantially those charitable associations which will be eligible.

Lord Hughes

The Minister is giving as his reason for not doing what the noble Earls, Lord Perth and Lord Dundee, are asking that it would be an opportunity for associations to be formed for the purpose principally, or perhaps solely, of avoiding the right to buy. Where this position exists, in England is there any evidence—perhaps even where there are local authorities which the Government dislike because of their attitude to sales—that any housing association of the kind that he apparently fears could be created in Scotland has been created south of the Border?

Lord Gray of Contin

Not to my knowledge, hut I could not answer that question without checking my facts. However, this is something to which we can return at a later date.

Lord Hughes

The Minister will investigate to find out whether there is what he would regard as a fraudulent housing association? Let me put this another way. He will investigate to find out whether there is a housing association formed for what he would regard as a fraudulent purpose?

Lord Gray of Contin

The noble Lord must not put words in my mouth. He asked me a question to which I am not able to give him the answer at the present moment. I have said to the noble Lord that we can return to this when we are discussing the matter at a later date. In the meantime, I shall try to find out the situation for him.

Lord Ross of Marnock

Surely at a later date one of the things we shall do is to remove this reference to the date, 3rd October 1980? Why do we not do it now, and then let us argue about what other date will be put in? That would be an earnest of the Government's good faith. Then all they would have to do thereafter would be to convince the Committee that the Government's new date is the right date.

I think that the important matter is to get rid of the reference to 3rd October 1980. The Government say that they have to do that anyway. They want to do that at a later stage. May I suggest that the Government do it now and then put in their idea of a new date later on? We can then see whether or not it is worthwhile. But I think that it would be worthwhile testing the Government's good faith on this as to whether they want to take out "3 October 1980". But that depends not upon me but upon the noble Earl, Lord Perth.

Lord Taylor of Gryfe

The date is important and the noble Lord, Lord Ross of Marnock, has made that point. But even more fundamental is the matter raised by the noble Earl, Lord Perth. It is the fact that the legislation affecting Scotland will be different from the legislation in England. That is a rather fundamental point which might also be tested.

Lord Gray of Contin

I feel that I have been very fair to the Committee tonight. I have made a very reasonable proposition. I wonder whether it is worth making concessions at all. I sometimes think that it is better to put one's head down and drive on because when one makes a concession all that happens is that people come back and say, "That is not enough, we want twice as much again".

Lord Hughes

I shall not be long. I would suggest to the noble Lord that the worst possible thing to do is to put one's head down and drive on. There comes disaster.

Lord Gray of Contin

I have no intention of doing that anyway, the noble Lord will be glad to hear. I have made a suggestion. The noble Lord, Lord Morton, has withdrawn his amendments. I hope that the noble Earl, Lord Perth, will agree to withdraw his amendment. We shall table our amendment in plenty of time. The House will have an opportunity of studying it and of consulting about it, and we can return to it at a later stage. I am not prepared to accept the guidance of the noble Lord, Lord Ross of Marnock, on this occasion. We shall deal with the matter in our amendment.

The Earl of Perth

I have listened to the exchange which has taken place and I am very grateful to the various noble Lords who have spoken in support of the amendment. I do not think at this late hour that it would be right to test the will of the Committee. However, I feel very strongly that before the Report stage the noble Lord, Lord Gray, should find a reason—which I certainly cannot imagine—why Scotland should be treated differently from England and Wales. The noble Lord says that we might misuse our rights, whereas the English and the Welsh do not do so. I am very unhappy with that argument. I hope that the noble Lord will do the same for us as has been done by the Government in respect of England and Wales.

I recall, too, that on this issue in respect of the English and Welsh Housing Bill the Government suffered perhaps one of the greatest defeats that they have ever suffered. Scotland is small by comparison, but the principle is the same. I trust the Scots. Having said that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Deputy Chairman of Committees

Before I call Amendment No. 23, I have to inform your Lordships that Amendment No. 23 has been misprinted and should read: "Page 22, line 14". I therefore propose, subject to your Lordships' agreement, that we should take it after Amendment No. 24. I therefore propose to call Amendment No. 24, but before doing so I have to inform your Lordships that if Amendment No. 24 is agreed to, I cannot call Amendment No. 23. I call Amendment No. 24.

Lord Carmichael of Kelvingrove moved Amendment No. 24: Page 22, line 14, leave out ("(not exceeding 14)") The noble Lord said: I did not propose to move Amendment No 23 anyway. I suggest to the Committee that, together with Amendment No. 24, we should also discuss Amendments Nos. 25, 26, 27 and 29. This group of amendments may seem rather complicated, but it is quite simple. The amendments are designed to give greater flexibility to housing associations and to allow them to cater more adequately for groups within the community.

The original reason for Amendment No. 24 was the limit of 14 houses. That triggered the idea that there was too much rigidity in the whole scheme. In general, although the Government have accepted the principle that there should be houses for people who require special treatment, they have hedged it round with so many safeguards that any initiatives as regards housing for care are greatly limited. The type of definition which the Government introduce is bound to place severe and irrelevant restrictions upon the development of community care initiatives which could be managed according to the needs of the people involved. For instance, one of the amendments which we are dealing with in this group concerns young people. The amendment suggests that the provision should read: young persons in need of care or support", instead of merely referring to young people who had been previously in the care of local authorities. We know that the experience of housing associations working with young people is that many young, single people need social support because they come from a family background which has had a disruptive influence on their development. As they develop into young adults they are as much in need of supported housing as the young people who have previously been in local authority care.

The same applies to older people in the community; the elderly persons in the community who are in need of care and support. The new category proposed in Amendment No. 27, category IV, would allow for elderly people in need of care and support. Disabled people and those who need support in their youth, their old age or during any difficult or traumatic period in their life require a supportive community.

Housing associations are in the forefront of new developments in caring for and supporting people in their own homes. Many of these schemes need not only a home for the person with special needs but also a supporting network around them. The sale of houses from housing association stock will lead to a degeneration in care of those most in need. Therefore, we suggest that more flexibility should be brought into the whole question of the number of houses within a group that can be used for those in need of care before the houses become eligible for sale.

We also suggest that, rather than leave a figure of 14 for the Secretary of State as a rigid limit, there should be flexibility. The Secretary of State should be able, as he sees fit, to nominate a limit above 14, but of course a limit which could not be exceeded. I beg to move.

10.45 p.m.

Lord Gray of Contin

These amendments relate to our proposal in the Bill that certain housing association schemes providing neighbourhood support for people with special needs should be excluded from the right to buy. During the passage of the Bill in another place there was concern about the effect of the right to buy on housing associations providing houses for people with special needs. While we believe that the existing safeguards in the 1980 Act relating to special needs housing for the elderly and disabled are working satisfactorily—and they will be extended to cover housing associations by this Bill—we accepted that there was one type of scheme which is unique to the housing association movement and which would not be covered by the present provisions. These are schemes which provide care and support in the community for groups such as ex-offenders and the mentally disabled.

The idea is that selected tenants, who act as what are called "caring neighbours", are allocated ordinary general needs houses, but in close proximity to tenants who require some special support and for whom the ordinary tenants accept responsibility. These schemes are sometimes also known as "neighbour support schemes". We accepted that such schemes should be excluded from the right to buy, and this is achieved by subparagraph (ii)(g) of paragraph 1(f) of Schedule 1 the Bill (that is, lines 13 to 31 on page 22). I should perhaps point out that it is to be all the houses in such schemes which are excluded from the right to buy; that is, both the houses which are let to the disabled people and the houses which are let to the "caring neighbours". The exclusion relates to schemes of not more than 14 houses.

I believe that these amendments are unnecessary. In the first place we are talking about essentially small schemes. We felt it necessary to put a limit on the number of houses because we should not wish inadvertently to find that we had excluded the full stock of an association's houses simply because it included one or two neighbourhood support houses. I think it is important that it is only the houses which actually form part of the neighbourhood support service that are to be excluded from the right to buy.

In consulting with housing associations on our proposals we concluded that the vast majority of such schemes consisted of 12 houses or fewer, and we set the ceiling in the Bill slightly higher (at 14) in order to correspond with what we understood to be existing practice and to leave associations some flexibility. With that explanation, and in view of what he himself has said, I hope that the noble Lord will feel that I have been able to illustrate that the Government gave a considerable amount of thought to this; and of course it was discussed at some length in another place as well. In view of what I have said, I hope he will be prepared to withdraw this group of amendments.

Lord Ross of Marnock

We are here dealing with quite a number of amendments, and I notice that the Minister of State did not say anything at all about No. 25, for instance. He did not mention No. 25. It is a quite important amendment and its implication would be considerable. I think he was a little unfair. If he is as reasonable as he claims, and if he does not want to be too inflexible, I do not see why he could not have accepted the first amendment and leave out "not exceeding 14" if he says the kind of housing association that he has in mind seldom has as many as that. Such associations may well have 14, 15 or 16. Indeed, at one time I had thought of 20 as being a fairly reasonable number to give the right spread. That is the amendment that was misplaced by virtue of a mistake in putting down "line 4" instead of "line 14".

I am not very happy at what the Government have done here. I know it is fairly late at night, but I can tell the noble Lord that each of these individual amendments is worth a considerable debate. The people are important; their future is important; the people doing the work of the housing associations are important.

I do not think it is giving credit to them and the work they are performing, or to the importance of the subject, that we should be here at eight minutes to eleven in an almost empty Chamber discussing the future of these matters. We did not start this today until about ten minutes to six. I do not think that is treating Scottish business in the right way. I shall certainly remember for a very long time the speech lasting twenty minutes and more that we had from the Minister of State in winding up while a few more Members were dragged in to vote for an amendment on which the Government did not want to be beaten. That is what happened. We are dealing with important matters at this time of night and not giving proper satisfaction to them. There is not a lot between us here, and I should like to think that the Government will have another look at this whole section of amendments.

I wonder what the Government's objection is to No. 24. The words look to be rather otiose but I think they are rather important words too, as no doubt the Minister of State will tell us if he now addresses himself to that particular amendment. I should like to hear what he has to say about No. 24, for instance, but 1 do not think there is very much more to go on.

Are we on No. 29 as well? No. 29 is on an entirely different subject. I do not know who grouped these amendments, but certainly anybody on our side who agreed to them did not know very much about what they were doing because No. 29 deals with an order on the part of the Secretary of State in regard to this matter, to amend and make changes. The amendment suggested is to increase the number of dwellinghouses under subsection (2)(g). That is the one we are discussing now. It is an entirely different point to deal with an order in regard to what is a substantial piece of legislation.

Lord Gray of Contin

I am always happy to oblige the noble Lord. I dealt with Amendment No. 24. I dealt with Amendments Nos. 24 and 29. We were not talking to Amendment No. 23 as it was not in order. The noble Lord wanted me to say a word or two about Amendment No. 25. Our proposal is to exempt a housing association type of scheme which deals with people with special needs in a unique way through neighbourhood support. The words "being a landlord so mentioned" mean a landlord who is a registered housing association. They have the effect, therefore, of confining the exemption to schemes of the type specified where the landlord is a housing association. This is because such developments are unique to the housing association movement.

The other amendments were Nos. 26 and 27. It is only right, in view of what the noble Lord said, that I should mention them. Amendments Nos. 26 and 27 seek to extend the list of special needs categories which are covered by the exemption. I believe that this is unnecessary. We accept that it is not possible at this stage to draw up a list of all the categories of special need which may be catered for in neighbourhood support in the future. The development of neighbourhood support schemes is still in its early stages. All we are attempting to do on the face of the Bill is to list the main categories of need that we know to be covered by existing schemes based on our discussions with the housing associations.

We are then taking a power—it is in the new Section 11A at lines 33 to 36 on page 22—to add further categories to the list by order. This means that as proposals come forward to extend the neighbourhood support schemes into other areas of special need we shall have the flexibility to add to the list of exemptions if that seems appropriate. I trust that with these explanations the noble Lord, Lord Carmichael, may be prepared to withdraw his amendment.

Lord Carmichael of Kelvingrove

I thank the Minister for his explanation. I hope he has taken the point both from what I said and from what my noble friend Lord Ross of Marnock said that we want more flexibility. We are not tying the Government down to anything. We want flexibility and that is why I considered that Amendment No. 29 seemed logical, as it gives the Secretary of State power to add to the categories, again giving him flexibility without tying him down. This is something that we should consider on Report to see what the Minister has to say about it then. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 23 not moved.]

[Amendments Nos. 25 to 29 not moved.]

Lord Gray of Contin moved Amendment No. 30: Page 23, line 49, leave out ("that") insert ("the former") The noble Lord said: This is a minor drafting amendment which I believe, nevertheless, will be helpful in solving a slight confusion that might have arisen over the present wording of the Bill. Paragraph 3 of Schedule 1 refers at lines 48 and 49 on page 23 to the date for the time being specified in that subsection". Somebody referring back to line 47, however, to find out which subsection is intended will discover that there are two subsections mentioned, subsections (7) and (7A) of Section 1 of the 1980 Act. It is intended that the words "that subsection" in line 49 should refer to subsection (7), which is the subsection amended by the Bill. This is, as I have said, a minor drafting amendment, but in its small way it removes a possible area of confusion that might arise in future. I beg to move.

On Question, amendment agreed to.

[Amendments Nos. 31 and 32 not moved.]

11 p.m.

Lord Gray of Contin moved Amendment No. 33: age 28, line 39, leave out ("payments") and insert ("repayments") The noble Lord said: This is a very minor drafting amendment which I trust need not detain the Committee long. Paragraph 15 of Schedule 1 amends Section 30 of the Tenants' Rights etc. (Scotland) Act 1980, which sets out the arrangements whereby local authorities determine the rates of interest to be charged on loans granted by them for house purchase and improvement. The new subsection (8) deals with arrangements for varying the amount of the borrower's repayments. Unfortunately, an error has crept into line 39, which speaks of "periodic payments" where, in fact, what is meant is "periodic repayments". This is, as I say, a very minor drafting point, but the amendment puts the matter right. I beg to move.

On Question, amendment agreed to.

Lord Ross of Marnock moved Amendment No. 34: age 29, line 18, after ("stepchild") insert ("or adopted child") The noble Lord said: This is self-explanatory, and I beg to move that we include "adopted child" along with "stepchild" as one of the family.

Lord Gray of Contin

I am glad to be able to assure the noble Lord that his concern that adopted children may be disadvantaged is unfounded, and that this amendment is unnecessary. The Adoption (Scotland) Act 1978 provides, in Section 39, that children who have been the subject of an adoption order are to be treated for all purposes as if they were legitimate children. It is unnecessary, therefore, to make any further provision in the new Section 82A of the 1980 Act, inserted by paragraph 17 of Schedule 1 to this Bill. The Adoption Act already ensures that an adopted child has the same rights as the natural child of a tenant. In the light of this explanation, I hope the noble Lord will agree to withdraw his amendment.

Lord Ross of Marnock

I am glad to withdraw the amendment, and I am very glad that publicity should be given to the fact that people should realise more and more that an adopted child is part of the family and the word "adopted" does not need to be mentioned. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 1, as amended, agreed to.

Clause 12 agreed to.

Clause 13 [Payments etc. in community-based housing associations]:

Lord Carmichael of Kelvingrove moved Amendment No. 35: Page 10, line 37, leave out paragraph (b) and insert— ("(b) the granting of a tenancy of a dwelling to a person described in section (2) below who is not an employee of the association: but only if the granting of the tenancy is made under the published rules required under subsection (1A) of section 27 of the 1980 Act.") The noble Lord said: With this amendment, it probably will be convenient for the Committee to take Amendments Nos. 36 and 37. This group of amendments has in my experience in the local areas created more indignation than almost any other single part of the Bill; because the very people who did so much work to establish the associations, and in many cases to save the areas, as well as doing a job in housing, are now feeling that they are being penalised. People who have done a great deal of work on a voluntary basis feel that they are being penalised because it is being considered that the granting of a tenancy, even within the association's published allocation policy, is a benefit.

I understand that it works so unfairly that, even if it were an all-Scottish housing association—and there are one or two—if you were a member of a local association in Edinburgh and you had a daughter, a son or any member of your family in Aberdeen or Inverness, or wherever else the national association happened to have branches, you would be considered as having a benefit by being given a house in these areas, although in every other way you may very well be fully qualified to receive such a dwelling.

I am sure that the Minister has been approached. I and most other Members I have spoken to, both here and in the other place who have any ties at all with housing associations or any knowledge of them, have been deluged by genuine people who feel that they are being unfairly treated. They feel that people in local authorities are not treated in the same way. People in the Scottish Special Housing Association who have relatives who are given houses are not treated in the same way, and they do not see why they, as voluntary people who have been working so hard for their association, should be treated differently.

The important point is that there is a published allocation policy. That can be very easily checked and looked at by the Secretary of State; and of course it will also be accepted by the Housing Corporation and recognised by them. So we are dealing with a very rigid set of rules and regulations; yet we understand that because of the way the Bill is at present worded anyone related in any way—and it can be a fairly far-out relationship—to someone who is a member of a housing association would be deemed ineligible for a dwellinghouse. I am sure the Minister is fully familiar with the argument and I just hope he will be able to throw some light on it and give some help to the people who have worked so hard for so long to try to make possible what has become a really important part of our housing scheme. I beg to move.

Lord Mackie of Benshie

I shall take the opportunity to speak to Amendment No. 37. It is a very late hour—far too late an hour to be discussing this extremely important set of amendments—but it will be very interesting to hear what the Minister has to say. We can perhaps get some good sense out of him—perhaps even a concession or an acceptance, though that might be too much to hope for. As the noble Lord, Lord Carmichael, said, these are very important amendments and they have aroused a great deal of heat. One can see the situation quite clearly where a person works for a community association—and these we reckon have done most good in run-down areas. Even the remotest relative is not able to apply for a house, in spite of the stringent regulations which can be enforced to see that there is no jiggery-pokery. This is too much. I feel that if it goes through, it will do enormous harm to a great many associations. If voluntary workers are penalised for doing the work they are doing, obviously they will not remain voluntary workers for very long. I await with interest what the Minister has to say.

Lord Gray of Contin

I thank the noble Lord, Lord Carmichael, for explaining his reasons for tabling this amendment, which, as he has explained, would increase the range of circumstances in which a community-based housing association could grant a tenancy to a voluntary officer, committee member or a close relative of one. In considering the previous amendment mention was made that the allocation of publicly funded housing is an area which is wide open to accusations, justified or otherwise, of injustice and preferential treatment, whether the authority concerned is a housing association or another housing body. Housing associations are particularly susceptible to such accusations, since there is a connection between the authority granting the tenancy and the individual receiving it.

The particular problems of community-based housing associations in relation to the granting of benefits arise from those characteristics which make their contributions so valuable; and their membership and their activities are confined to a specific geographic area. Their renovation programmes must therefore at certain points conflict with the interests of their committee members or their relatives who are resident in the area. In that situation there is a clear need, both operational and on grounds of equity, for the association to be able to buy a house from and offer a tenancy to those people when their houses are directly affected by the renovation programme. The clause as drafted gives associations that ability and the 12-month period makes allowance for people who have moved out of the area recently or on a temporary basis.

The noble Lord's amendment would enable community-based housing associations to grant tenancies to committee members, officers and their relatives who were not currently resident in the area. While that would undoubtedly facilitate the return of such people to the community from which they might have moved or been obliged to move some time previously, I have to say that I see that as a distinctly different category of allocation from those provided for in paragraph (b) of new Clause 15A. The same arguments about the direct effect of the development programme on their homes do not apply, and without that distinction they are not in a materially different position from the committee members of any other housing association. There is certainly no operational need or difficulty related to equity there.

The provisions set out in Clause 13 were carefully drawn up to provide a specific solution to a particular problem which is probably unique to community-based housing associations in Scotland. As such, I accept that it merits a solution which is not available to housing associations generally, but only to the extent that the problem is unique. I do not believe that it is necessary or even desirable to widen the scope of the clause in the way proposed in the amendment.

We are also dealing with Amendment No. 36. The effect of Clause 13 will be to permit community-based housing associations in certain specified circumstances to buy a dwelling from, or offer the lease of a dwelling to, a voluntary officer, committee member or a close relative of such a person. Such measures are deemed necessary in order to facilitate the renovation programmes of the associations and to ensure that those persons are treated on the same basis as others who are resident in houses which may be affected by the programme.

The effect of the noble Lord's amendment would be to prevent the close relatives of voluntary officers and committee members of those associations from benefiting from the limited exemptions set out in the Bill. Relatives might include the actual owner or tenant of an affected flat, for example, where a committee member lived with his parents. It is unlikely to be welcomed, therefore, by the persons affected since they will regard it as being unfair, or by community-based housing associations which would be unable to acquire properties from the individuals or to offer tenancies to them in order to advance rehabilitation projects.

The noble Lord, Lord Mackie, who spoke to Amendment No. 37, acknowledged that his amendment goes some way beyond the terms of Clause 13, as it stands, by attaching new provisions to Section 15(2) of the Housing Associations Act 1985. It will enable all housing associations to grant tenancies to and acquire properties from their committee members, officers and employees. It would also have the effect of extending the limited range of permitted benefits listed in Section 15(2) of the 1985 Act to include the granting of tenancies under the terms of published rules governing allocations.

The existing powers of the Housing Corporation, under the Housing Act 1974, were insufficient to cope with those developments and new provisions were introduced in the Housing Act 1980. Those provisions preclude registered housing associations from making any payments other than those specified or granting any other benefits to committee members, officers or employees, persons who had held such positions within the preceding 12 months, close relatives of such persons or businesses in which such persons had a direct interest. Those provisions now lie in Section 15 of the consolidating Housing Associations Act 1985.

The restrictions imposed on housing associations by Section 15 of the 1985 Act are designed to ensure that decisions on the use of public funds are taken in a fair and proper manner and that there is no question, real or implied, of a conflict of interest for officers and committee members. The practices which led to the introduction of those restrictions were not universal and they had little impact in Scotland, but there was sufficient evidence of abuse and uncertainty to justify the action taken. It can be argued that measures introduced to cope with the problems of dual interest in relation to payments, consultancies and contracts are not appropriate to the granting of tenancies, but in the granting of individual tenancies, even under a defined and published set of rules, there will always be choices to be made between competing applicants. We all know that the allocation of publicly funded housing is regularly subjected to criticism and accusations of injustice. Where there is a connection between some officer or member of a housing authority and the recipient of the tenancy, suspicions, justified or not, can easily arise. Indeed, it is likely that problems of this kind arouse greater public interest than the wider commercial and accountability issues which rightly concern us here.

I recognise that the measures contained in Clause 13 do not go as far as some associations would have wished and this amendment reflects that. However, I do not think that the case for the more relaxed control suggested by the amendment has been made. Indeed, I think there is a serious risk that the sensible controls introduced in 1980 would be seriously eroded by it. I believe that Clause 13 deals with the distinct problems facing community-based housing associations which are unique to them in a way that they will welcome. Once again, I apologise to the Committee for that rather lengthy explanation, but they are very important amendments which I take seriously. I trust that with that explanation noble Lords will be prepared to withdraw their amendments.

Lord Carmichael of Kelvingrove

I thank the Minister for that very full explanation. I do not think he need apologise for its length because this is a very important subject. I am sure he will equally realise that that sort of reply needs a certain amount of expertise and I do not have the benefit of that to the extent that he does. Perhaps he will accept that if we withdraw the amendment we shall want it looked at by those who are involved and will want to leave ourselves free to bring it back at Report stage. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 36 and 37 not moved.]

Clause 13 agreed to.

Clauses 14 to 17 agreed to.

[Amendment No. 38 not moved.]

Remaining clauses and schedules agreed to.

House resumed; Bill reported with the amendments.