HL Deb 07 October 1986 vol 480 cc211-28

Disposals to which this Schedule applies

  1. 1.—(1) This Schedule applies to the disposal by a local authority of an interest in land as a result of which a secure tenant of the authority will become the tenant of a private sector landlord.
  2. (2) For the purposes of this Schedule the grant of an option which if exercised would result in a secure tenant of a local authority becoming the tenant of a private sector landlord shall be treated as a disposal of the interest which is the subject of the option.
  3. (3) Where a disposal of land by a local authority is in part a disposal to which the Schedule applies, the provisions of this Schedule apply to that part as to a separate disposal.
  4. (4) In this paragraph "private sector landlord" means a person other than an authority or body within section 80 (the landlord condition for secure tenancies).

Application for Secretary of State's consent 2.—(1) The Secretary of State shall not entertain an application for his consent to a disposal to which this Schedule applies unless the authority certify either—

  1. (a) that the requirements of paragraph 3 as to consultation have been complied with, or
  2. (b) that the requirements of that paragraph as to consultation have been complied with except in relation to tenants expected to have vacated the dwelling-house in question before the disposal;
and the certificate shall be accompanied by a copy of the notices given by the authority in accordance with that paragraph. (2) Where the certificate is in the latter form, the Secretary of State shall not determine the application until the authority certify as regards the tenants not originally consulted—
  1. (a) that they have vacated the dwelling-house in question, or
  2. (b) that the requirements of paragraph 3 as to consultation have been complied with;
and a certificate under sub-paragraph (b) shall be accompanied by a copy of the notices given by the authority in accordance with paragraph 3. (3) References in this Schedule to the Secretary of State's consent to a disposal are to the consent required by section 32 or 43 (general requirement of consent for disposal of houses or land held for housing purposes).

Requirements as to consultation

3.—(1) The requirements as to consultation referrred to above are as follows. (2) The authority shall serve notice in writing on the tenant informing him of—

  1. (a) such details of their proposal as the authority consider appropriate, but including the identity of the person to whom the disposal is to be made,
  2. (b) the likely consequences of the disposal for the tenant, and
  3. (c) the effect of the provisions of this Schedule and of sections 171A to 171F (preservation of right to buy on disposal to private sector landlord),
and informing him that he may, within such reasonable period as may be specified in the notice, make representations to the authority. (3) The authority shall consider any representations made to them within that period and shall serve a further written notice on the tenant informing him—
  1. (a) of any significant changes in their proposal, and
  2. (b) that he may within such period as is specified (which must be at least 28 days after the service of the notice) communicate to the Secretary of State his objection to the proposal,
and informing him of the effect of paragraph 5 (consent to be withheld if majority of tenants are opposed).

Power to require further consultation

4. The Secretary of State may require the authority to carry out such further consultation with their tenants, and to give him such information as to the results of that consultation, as he may direct.

Consent to be withheld if majority of tenants are opposed

5.—(1) The Secretary of State shall not give his consent if it appears to him that a majority of the tenants of the dwelling-houses to which the application relates do not wish the disposal to proceed; but this does not affect his general discretion to refuse consent on grounds relating to whether a disposal has the support of the tenants or on any other ground. (2) In making his decision the Secretary of State may have regard to any information available to him; and the local authority shall give him such information as to the representations made to them by tenants and others, and other relevant matters, as he may require.

Protection of purchasers

6. The Secretary of State's consent to a disposal is not invalidated by a failure on his part or that of the local authority to comply with the requirements of this Schedule.").

The noble Lord said: I beg to move. I spoke to this with Amendment No. 26.

On Question, amendment agreed to.

Schedule 1 [Land registration and related matters where right to buy preserved]:

Lord Skelmersdale

moved Amendment No. 34: Page 85, line 27, leave out ("not less than 40") and insert ("more than 21") The noble Lord said: I beg to move Amendment No. 34 and speak also to Nos. 35 and 41. These are purely drafting amendments. There is nothing technical or anything else about them. I beg to move.

On Question, amendment agreed to.

Lord Skelmersdale

moved Amendment No. 35: Page 85, line 28, leave out ("not less than 40") and insert ("more than 21") On Question, amendment agreed to.

Lord Skelmersdale

moved Amendment No. 36: Page 86. line 38, leave out ("without producing the land certificate" and insert ("and section 64(1) of the Land Registration Act 1925 (production of land certificate) does not apply to the entry of a notice or restriction on such an application;") The noble Lord said: I beg to move Amendment No. 36. I spoke to Amendments Nos. 36 to 40 together with Amendment No. 28. I beg to move.

On Question, amendment agreed to.

Lord Skelmersdale

moved Amendments Nos. 37 to 40: Page 87, line 25, at end insert— ("( ) Where on a conveyance of the freehold or grant of a lease of the qualifying dwelling-house to a qualifying person otherwise than in pursuance of the right to buy the dwelling-house ceases to be subject to any rights arising under this Part, the conveyance or grant shall contain a statement to that effect.") Page 87, line 28, leave out ("171D(5)") and insert ("171D(1)(a) or 171DA(2)(a)") Page 87, leave out lines 34 to 42. Page 87, leave out line 48. On Question, amendments agreed to.

Lord Skelmersdale

moved Amendment No. 41: Page 88, line 12, after ("the") insert ("preserved") The noble Lord said: 1 beg to move Amendment No. 41. I spoke to it with Amendment No. 34.

On Question. amendment agreed to.

Lord Skelmersdale

moved Amendments Nos. 42 and 43: Page 88, line 16, leave out ("1971") and insert ("1986.) Page 88, line 16, leave out from ("upon") to end of line 21 and insert—

  1. ("(a) a certificate given in pursuance of paragraph 2 (certificate of title on first registration).
  2. (b) a statement made in pursuance of paragraph 7 (statements required on disposal on which right to buy ceases to be preserved), or
  3. (c) a certificate given in pursuance of paragraph 9 (certificate that dwelling-house has ceased to be subject to right under this Part).
the person who gave the certificate or made the statement shall indemnify him.") The noble Lord said: I spoke to Amendments Nos. 42 and 43 with Amendment No. 28. I beg to move.

On Question, amendments agreed to.

Schedule 1, as amended, agreed to.

Clause 5 [Redevelopment of dwelling-house subject to secure tenancy]:

Baroness David

moved Amendment No. 44: Page 17. line 20, at end insert— (" ( ) In section 84 of the Housing Act 1985 (Grounds and orders for possession), after subsection (1)(b) insert the following— (bb) on ground 10A unless—

  1. (i) the dwelling house is to be demolished; or
  2. (ii) substantial works are to take place and as a consequence the tenant cannot reasonably be expected to continue to reside in the dwelling house and the condition holds that the tenant will be offered the tenancy of the dwelling house when the works have been completed;".")
The noble Baroness said: It is rather unfortunate that as the time has worked out we should come to what is perhaps the most contentious clause of the Bill at this time of night and with so few Members of your Lordships' Committee present. However, we obviously have to press on and so we come to the first amendment, Amendment No. 44, to Clause 5.

The purpose of this amendment is to ensure that possession will not be granted where there are works of a minor nature, or no works, planned. As presently structured new Ground 10A draws no distinction between cosmetic works and major works as a ground for ordering possession. Tenants are not protected at the moment. As the Bill stands possession can be granted under Clause 5 even though no work is to be carried out on the dwelling after it has been sold off.

That is, tenants can be removed from a perfectly good home in order that it can be sold off with vacant possession.

The amendment would ensure that possession would only be granted where the house was either going to be demolished or the repair improvement works were so substantial that possession was necessary. The last part of the amendment sets out to ensure that the tenant displaced will have first option on the tenancy again after the improvement works are completed. Only if the tenant declined that option could the house then be sold.

At the moment the Secretary of State has to take into account the extent to which tenants would be offered tenancies or the opportunity to purchase homes in the scheme, but there is no requirement that this should be the case.

It seems to us that the grounds we suggest in the amendment are the only reasonable grounds on which eviction should be ordered. The scheme could not proceed unless possession was obtained. An individual tenant could therefore not unreasonably hold up the progress of the whole scheme. I know people are anxious that one difficult tenant could hold everything up. It seems reasonable to ask why, if the house was not needed for any major works, the tenant should not stay there?

This amendment contrasts with the wide-ranging powers available in the clause as it stands at present. What we want to prevent is a tenant being evicted from his or her home so that it can be handed over to a private development for sale to someone else after such trivial improvements that the tenant could have remained in the property during the works. This we think would be immoral; I mean some scheme such as just putting on a porch.

The Committee may be aware of the Langbaurgh case, which was discussed fully at Committee stage in another place. Langbaurgh council recently tried to evict two tenants from their homes in exactly these circumstances. The council wanted to hand over tenants' homes to Barratt who proposed such cosmetic and trivial improvements, such as the installation of a new porch, that tenants could have remained in their homes during the works. I have many more details on what went wrong at Langbaurgh, but it seems to me that at this time of night it would not be very sensible to go into them. I have extensive coverage of that and some of it is pretty horrifying.

Ministers were concerned to hear in Committee in another place about the experience of the Langbaurgh tenants. Mr. John Patten, the Housing Minister, said he would not want the new ground for eviction to apply in such circumstances. He said: tenants should not be moved unnecessarily or for minor works. People should not be moved needlessly for superficial changes to the property". That was reported at col. 225 of the Committee proceedings on 4th March.

This amendment would put the Minister's commitment into the primary legislation by ensuring that the new ground for eviction could not be used in circumstances where tenants would be able to remain in the property during the works. It would restrict the new ground to circumstances where the landlord wished to dispose of tenants' homes for demolition, or when the landlord wished to dispose of tenants' homes for substantial improvement, following which tenants would be given the opportunity to return to their homes so as to prevent properties being improved just for sale to someone else.

This is a very important amendment. If the Minister can justify evicting people for any other reasons than this, I shall be very surprised indeed. I beg to move.

Lord Skelmersdale

I must say that after sitting through the Committee for all the Committee's working day I rather thought that nothing I would say would surprise the noble Baroness, but we shall see. First, I fail to be convinced that we should limit the granting of orders to cases in which demolition is proposed or in which substantial works are needed to the dwelling, so that the tenant could not live there while the works were in progress. Perhaps I am about to surprise the noble Baroness. This is because it may be desirable in some cases to redevelop an estate as a whole in circumstances where not all the dwelling-houses on the estate are to be subject to demolition or substantial works. The ground for possession found in the new Ground 10A is intended to help local authorities and other landlords of public sector tenancies to deal with their run-down estates by enabling them to sell those estates to the private sector for redevelopment or modernisation. In such cases it may be necessary to recover the possession of all the dwelling-houses in order to bring the estates back into use as decent houses. Sales to the private sector will bring private capital into the process of bringing that housing back into full use. That must be in everybody's interest.

To limit the use of the new ground as proposed would, in effect, restrict the options open to the council when negotiating with the developer. The noble Baroness mentioned the recent case of the Spencerbeck estate at Langbaurgh and cited it as an example of what will happen if local authorities are given the power to move tenants to make way for redevelopment schemes. This new Ground 10A was not in existence; indeed, it will not be in existence until this Bill receives Royal Assent. So the council relied on existing grounds for possession and not on the new ground in Clause 5. In the event, as we all know of course, the council did not move tenants who took the case to court.

The amendment proposed by the noble Baroness would also make the granting of an order in the second category conditional on any displaced tenant being offered the tenancy of the same dwelling-house once the works have been completed. The noble Baroness mentioned this in her introduction. The Committee will know that before applying to the courts for a possession order any public sector landlord wishing to use the new ground will first have to seek the approval of the Secretary of State, or the Housing Corporation in the case of a housing association. He will be required to take certain factors into account before giving his approval. One of these is the extent to which the scheme includes provision for housing to be sold or let to existing tenants. This is not a compulsory requirement, as envisaged by the amendment, but it will be an important consideration. There may be circumstances where an authority judges it to be in the best interest of its current and prospective tenants to allow the renovated properties to be sold or let on assured tenancies and to use the enhanced receipts to repair and renovate other parts of its stock. This amendment would prevent a council from adopting such a solution.

I remind the Committee also of the requirement that suitable alternative accommodation be available for displaced tenants before a court can grant an order for possession. With those points in mind, I trust that the Committee will consider that this leg of the amendment would introduce unjustified restrictions on a council's discretion, as indeed would the other legs of the amendment.

10 p.m.

Lord Dean of Beswick

In this particular part of the clause, I found rather odd the explanation the Minister has given as to why the amendment is not needed. One assumes from his answer that some new ground is going to be broken in the improvement of council houses. I have to tell the Minister that 12 to 15 years ago some local authorities started to improve their pre-war estates on a massive scale. I was the chairman of housing in Manchester when we embarked on a programme for improving 30,000 pre-war houses a year. That was done with four different contractors. You do not get the same results from every area. Those improvements were not carried out in pockets, in a small number of houses. I think the average number of houses in the first contracts was about 400.

It is difficult to get a consensus on what should operate. Nowhere did we indulge in a policy of forced eviction while the house was being improved, until completion, when the tenant went back. Oddly enough, most of the tenants, despite all the disturbance and inconvenience, opted to stay in their own house while the improvements were being done, though this happened often at great inconvenience to them. That was because it was inherent to them that their house, though a council house, was their own house—it was the one that they lived in.

The Minister spoke earlier about the Bill being about people. His reply on this amendment moved by my noble friend Lady David was related solely to what was the best way of dealing with the housing exercise and was not about the people involved. These houses that were being improved were pre-war houses. They were basically good houses which certainly required substantial alteration and improvement. The type of improvement we are talking about here is one that would make undersirable older houses more attractive both to the people still in them and to potential occupiers.

I have once again to remind the Minister that the housing investment programme has been butchered over the past few years. I have to remind him that even this year the local authorities' housing investment programme has been cut not only in percentage terms but in real terms. I know that the submissions made by major cities were about 8 per cent. up on their bids last year but were about 8 per cent. to 10 per cent. less than they got. I think it is plain that a political ideology is pushing it a bit too far. We are told the objective of the Government is to see the renovation or the build-up of estates which have started to deteriorate. I am not suggesting that it has all happened since 1979 but, my goodness! the Government have made cuts in housing expenditure in the public sector and there have been successive reports from independent political bodies with an expertise in this particular subject which indicate the cause. I would think myself that this part of it is strictly an exercise in that. I agree with everything that my colleague on the Front Bench has said, and I think that the Minister's answer, certainly on this occasion, has dealt with houses and not with people: in other words, what is best for the house and not best for the person.

Lord Skelmersdale

In a case like this, what is best for the people is for the estate to be redeveloped; but what I was trying to point out in my original answer to the noble Baroness's amendment was that this amendment would remove the flexibility from local authorities that Ground 10A is intended to give. It may very well be that it is not necessary to move everybody on a particular redevelopment scheme, in which case that should be allowed. On the other hand, it might very well be that it is necessary to move everybody in a redevelopment scheme, in which case that should he allowed. All I am asking for is for the law to allow local authorities—because it is local authorities we are talking about—in the first instance to be able to keep their options open.

Lord Dean of Beswick

Before the Minister leaves that aspect—and I am sorry to come back at this late stage—can he answer the point? I think that it is a realistic one. The Minister has on more than one occasion talked about the demolition of properties within an area, leaving other properties standing. If there is an estate with, say, 400 or 500 houses—and that was a common number of houses to form a council estate—and if it is said, "We will demolish some of these houses; we will give it a better density and demolish 100 houses", who is going to be the arbiter as to which houses shall be demolished? Some of the tenants will say, "Why are you knocking my home down when there are other tenants at the other end of the estate who have not been here as long as I have?" Who is the arbiter who will decide? Surely in those circumstances one tenant has the same rights as another?

Lord Skelmersdale

We are talking in this case about a management decision. It is as simple as that.

Lord Dean of Beswick

But the whole process of the Bill is supposed to be about people. The Minister has kept saying that, but now he has switched tracks. He is saying that it is a management function—never mind the people: the management will make the decision. We are saying that the decision is so important to the people who live in those houses that they should have a very high input into what decision is made and they should not be treated in such a manner.

Baroness David

I am not at all satisfied with what the Minister has said, but I will have the good grace to read what he has said in Hansard tomorrow and see whether there is any more matter to it than I think there is now.

I agree with my noble friend Lord Dean that it is the people who are occupying these houses and who are likely to be subject to eviction that we have to think about. It does not seem to me that the Minister has made a sufficient case; but, as I say, I will read what has been said and of course we shall reserve the right to come back to this on Report. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Dean of Beswick

moved Amendment No. 45: Page 18, line 22, leave out from beginning to end of line 26 and insert— ("( ) The landlord shall not apply to the Secretary of State until two thirds of the tenants of the dwelling-houses included in the Scheme have agreed in writing to the Scheme, following a consultation period of not less than three months from the point at which full details of the proposal redevelopment have been made available on an individual basis to the tenants concerned.") The noble Lord said: In view of the time, I shall be as brief as possible. This amendment has been tabled because of the exercise that the Minister earlier indicated is the desire of the Government, which is really what is best for the people. We know that the question of upgrading houses and that type of thing is involved. Concerning the requirement that two-thirds of the tenants should agree, we have used this figure because we believe it is a reasonable proportion. I do not think one can accept the situation where a small minority could hold up progress on a large scale development.

I saw this happen during the halcyon years of slum clearance, with the massive council house building programmes, where some persons refused to move house unless they were given a house built literally where they wanted it and to their own specifications. Most local authorities acted in a sensible manner and tried to accommodate those people, even to the point where I believe that local authorities, on some occasions, were involved in considerable expense because of certain people. This meant that demolition workers could not move in and demolish buildings, or one might have the situation where only one house was left standing in a demolition area and the builders could not move in. On that basis, we think that the figure of two-thirds is reasonable. We have mentioned three months in this amendment, because we believe that in order to get the necessary feed-back three months would be a reasonable time for the exercise to be completed. I beg to move.

Lord Skelmersdale

I understand the objectives of the noble Lord, Lord Dean of Beswick, but I fear that the effect of this amendment would be rather different from what I think he anticipates. Very often. a large number of tenants will have already vacated the estate at their own request, leaving properties empty and hard to let. The noble Lord, as past chairman of a local housing authority in Manchester, will know this situation very well indeed. In the normal course of events, a local authority will seek to move remaining tenants by agreement. This is how they proceed under the present Ground 10. Clause 5 will help this process by enabling councils to offer home loss payments, but in a limited number of cases a few tenants may be unwilling to reach agreement with the council over their transfer. In such cases, the council may decide to use the proposed Ground 10A for possession, but by then there will most likely be very few tenants left and it would be quite unrealistic to expect a landlord to get two-thirds of those remaining (who are by definition those most opposed to the scheme) to write in support, even though the scheme may well have been welcomed by the vast majority of the original tenants, or—and this may be just as important—wanted by many other tenants and prospective tenants who are affected either by the present conditions on the estate, or who would benefit from the additional resources that the development would bring to the council.

The Committee may not realise that the other effect of the amendment would be to limit severely the circumstances in which a council could make home loss payments to tenants moving to enable a redevelopment scheme to take place. The landlord could only make such payments when he has applied or could have applied for scheme approval. If this amendment were accepted, no home loss payment could be made until the written agreement of two-thirds of the tenants had been obtained. I do not think that this can be what the noble Lord intends.

The amendment also proposes that tenants be given three months in which to make their views known. Three months is far too long. Twenty-eight days from the date the notice is served, as proposed in paragraph 2 of the schedule referred to in Clause 5, is normally quite adequate for those tenants with genuine representations to make to notify their landlords. The aim must be to avoid stultifying and cumbersome bureaucratic procedures while safeguarding—and this is the part which the noble Lord has been waiting for—the tenants' rights. Building in a compulsory three months' delay is unnecessary and, I submit, a step in the wrong direction. With all these reasons in mind, I trust the noble Lord will be able to see his way to withdrawing the amendment.

10.15 p.m.

Lord Dean of Beswick

I am grateful to the Minister for his reply and I believe he will not be surprised if I still insist that the amendment would be beneficial to all concerned. I would correct the Minister on one thing. When he speaks of old houses and old estates being difficult to let, I must say to him that in my experience it is some of the more modern estates that are difficult to let. At the outbreak of war, some of the big cities in the country built about 30,000 houses. Cities like Manchester, Liverpool, Leeds and Sheffield were all on the 30,000 mark for pre-war houses, with very few flats. Once those houses were upgraded and the programme was under way, and once serious inroads had been made into bringing them up to standard, they were in no way difficult to let.

The double-decker maisonettes or running-deck access flats, that were built under urgings from various governments between 1955 and 1975, are the difficult estates. When was the Broadwater Farm estate built, when were some of the estates built that are already being got rid of in Liverpool and when were The Forts in Manchester built?

My hands were clean on that. I was not chairman of housing and we were not in control when it happened. But it is not a political question, because successive governments, both Labour and Conservative, were to blame for what happened. Those are the developments that local authorities could discard tomorrow from their housing stock and there would be no whimper at all from any tenants, so long as they were housed somewhere else.

So if the Minister thinks that there is any bonus in picking on the pre-war estates that have begun to be upgraded—and there will be a large exercise for Wimpeys, Barratts and Laings—I still say it is an exercise that is completely spurious, because if the finance were made available to local authorities there would be no need at all for it. I do not accept what the Minister said, but in view of the time and since the Minister understands my feelings I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Dean of Beswick

moved Amendment No. 46: Page 18, leave out lines 30 to 39 and insert—

  1. ("(a) the necessity of the works for the future benefit and housing needs of the area, or dwellings subject to the Scheme or variation;
  2. (b) the necessity of the works for the future well-being of the persons for the time being resident in the area;
  3. (c) any adverse effect of the Scheme on the extent and character of housing accommodation in the neighbourhood;
  4. (d) any adverse effect of the Scheme on persons for the time being resident in the area;
  5. (e) whether the disposal and redevelopment will take place in a reasonable period of time; and
  6. (f) to what extent the Scheme includes provision for housing provided under the Scheme to be sold or let at a fair price or rent to existing tenants.")
The noble Lord said: I shall speak very briefly on this amendment, which seeks to leave out lines 30 to 39 on page 18. In paragraphs (a) to (f) are various qualifications that we ask to be included, in order, once again, to protect tenants, such as the necessity of the works for the future benefit and housing needs of the area, so as to cater for the global aspect, because what is done in a neighbourhood should be on the basis of what is good for most of the people involved. I shall close my remarks there because of the time and will listen to the Minister. I beg to move.

Lord Skelmersdale

The amendment seeks to change the factors which the Secretary of State or the Housing Corporation must take into account in deciding whether or not to approve a redevelopment scheme proposed by a local authority or a housing association. These factors were inserted in response to calls in Committee in another place for the Secretary of State to be bound to take into account certain key matters—for example, any representations made to him or the effect of the scheme on the extent and character of the housing in the neighbourhood. The list was not intended to be comprehensive; hence the words in line 29 on page 18 "in particular". Obviously, the Secretary of State must take into account any relevant factors and what is relevant will vary from scheme to scheme. The noble Lord's amendment therefore does little to change the way in which the Secretary of State would consider a scheme. It merely highlights possible disadvantages of schemes, while ignoring the possibility that a scheme might benefit an area.

I do not think that the statute book is the place for such an operation and I submit that paragraph 3(1) should remain as drafted as an indication of the range of factors to which the Secretary of State should pay particular attention, as well as anything else which appears to be pertinent to the case that the Secretary of State is actually considering. I hope that that explains the amendments that we have made to the Bill.

Lord Dean of Beswick

At this stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 47 not moved.]

Baroness David

moved Amendment No. 48: Page 20, line 24, at end insert— ("(6) In section 26(1) of the Housing Act 1985 (financial assistance towards tenant's removal expenses) after the words '(whether or not that house is also one of theirs)' insert— or where the house is the subject of an order for possession under ground 10 or 10A in part 11 of Schedule 2 to the Housing Act 1985 the authority shall" ") The noble Baroness said: With this amendment I should like to speak to Amendments Nos. 49 and 50 because they really are in a group. The aim of the three amendments is to ensure that tenants that are evicted are adequately compensated.

At the moment compensation for those displaced through Clause 5 is restricted to home loss payments under the Land Compensation Act. Tenants could lose financially as a result of being forced to move. Home loss payments are restricted to people who have lived in their home for five years. They are worked out on a simple formula of three times rateable value as opposed to rates paid. The maximum is £1,500. The average payment is likely to be between £500 and £800 but anyone who has been resident for fewer than five years will get nothing at all. Anyone, on being forced to move house, will of necessity have removal expenses of between £150 and £400 or more. There will also be the setting up costs of new carpets, furniture and other matters. Very few public sector landlords provide their incoming tenants with carpets and curtains. If the householder displaced chooses to purchase, a deposit will be required and legal fees will need to be paid. Legal fees are in the region of £500 for purchase. Further, tenants may have improved the inside of their existing home. Perhaps central heating has been installed or repairs carried out or other improvements made. Overall, the level of compensation offered at the moment is wholly inadequate.

The amendments proposed bring the compensation offered in line with that for tenants displaced under slum clearance schemes, so there is a precedent for this. First, tenants will be eligible for well maintained payments where they have kept the interior of their house in good condition or carried out improvements. Again, these are worked out as a lesser multiple of rateable value. They are not new as anyone displaced from slum clearance will be eligible for well maintained payments in appropriate cases. This is dealt with in Amendment No. 48.

Secondly, tenants will be eligible for disturbance payments. These are already in the Land Compensation Act and apply to most redevelopment schemes. The entitlement is to reasonable expenses of removing from the land. They go beyond removal expenses and they are not cash limited. That is taken care of in Amendment No. 49.

Thirdly, power is given to landlords to pay removal expenses direct by bringing Clause 5 within the appropriate sections of existing legislation. That is in Amendment No. 50.

Without these amendments, tenants could lose substantially under the scheme as it is proposed at the moment. Local authority tenants should be afforded the same degree of compensation as private owners affected by slum clearance and other schemes. It would seem only fair that that should be so. I beg to move.

Lord Skelmersdale

Are not precedents wonderful things? Indeed, I produced some precedents on an earlier amendment, as the noble Baroness will remember. The important thing about precedents is that they are useful only when they are pertinent to the case in point. Amendments Nos. 48, 49 and 50 are obviously intended to maximise the compensation paid to a secure tenant displaced from his or her home under a possession order under Ground 10 or new Ground 10A of Schedule 2 to the 1985 Act. To all but the landlords concerned that is no doubt a laudable objective. It is therefore a little hard for me to have to say that the amendments are either redundant or wrong in principle.

Amendment No. 48 tries to apply to possession order cases compensation powers relating to slum clearance to very different dwellings. This would clearly be a wholly inappropriate use of the powers. The noble Baroness really is not comparing like with like.

Amendment No. 49 relates to a provision in the Land Compensation Act which is primarily concerned with compensation for compulsory purchase. Again, you can hardly call this comparing like with like. The circumstances in which local authority tenants can benefit under this provision are essentially limited to those where the tenants were in possession before the authority acquired possession. Any departure from this principle would clash with the philosophy and purposes of the existing provision. The resulting changes would produce anomalies compared with tenants moved or evicted under other grounds and would, to some extent, be unnecessary.

Any authority can already compensate a displaced tenant for the value of his or her improvements to the dwelling under Section 100 of the 1985 Act. Clause 5 of this Bill provides for home loss payments for suitably qualified tenants, under Section 29 of the Land Compensation Act 1973, and authorities have the discretionary power under Section 26 of the 1985 Act to pay financial assistance towards tenants' removal expenses.

Those are, in the Government's view, quite sufficient compensation powers for the cases at issue here; and furthermore, with Amendment No. 50 in mind, I would add that we see no need to make Section 26, which is as I have said, a discretionary power, a binding duty on local authorities where Ground 10 and 10A cases are involved. We are prepared to trust the local authorities to use this power reasonably. There has been no weight of evidence, from the long experience with the present grounds, that our confidence would be misplaced. I therefore suggest to the noble Baroness that what these amendments seek to do is already sufficiently covered by statute and that to go further really would be inappropriate.

Baroness David

I am not convinced by what the Minister said, and I think we probably are comparing like with like though he says we are not. I shall have to read what he said and come to my own conclusion as to whether or not I shall come back again later on these matters.

It seems to me that people who are being evicted need very special attention, and it would be some compensation if these amendments were written into the Bill. I shall do no more about it tonight. but I shall read the Minister's remarks and reserve the right to come back at Report stage. At the moment, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 agreed to.

Clause 6 [Management agreements]:

Lord Skelmersdale

moved Amendment No. 51: Page 20, line 25. leave out subsection (1). The noble Lord said: I have already spoken to this amendment with Amendment No. 26. I beg to move.

On Question, amendment agreed to.

10.30 p.m.

Lord Dean of Beswick

moved Amendment No. 52: Page 20, line 32, leave out ("another person") and insert ("an approved body"). The noble Lord said: I think I am like the Minister: we are all getting our papers mixed up at this time of night. The reason for Amendment No. 52 is to seek to have the housing management functions transferred specifically to a managing body whose status is defined by law. Such provisions will ensure that tenants are afforded the necessary protection and also that the managing agent's interests will not conflict with those of the tenants concerned.

We say this because we honestly believe that to transfer tenancies of local authority housing to a person or persons would be a very, very dangerous road to go down, as we know from past experience. That in effect is indulging, in my opinion, in privatising a management system—I believe in the final analysis against the wish of the tenant. Most of the excesses which have taken place in landlord-tenant relationships have done so where the private sector has become involved. I am not for one moment condemning out of hand all private landlords, because there are some good ones who operate pretty well within the limits allowed.

I know that their role over the years has diminished because of the changing trends in housing, of owner-occupation, and the huge number of council houses that have been built since the war. Having said that, I know that it is fashionable in some quarters to criticise, quite unfairly, the biggest landlords in the country—the municipal authorities. I have said on previous occasions—and I repeat it now—that the overwhelming number of council house tenants (and I repeat "overwhelming") but not all of them, are happy to be run by their local authorities. They have the right to complain and, in the main, have access to their local councillors. Do not for one moment think that they do not use that facility, because as an ex-councillor I can assure the Committee that where I operated they used it quite forcefully.

In a personal sense, the role of local councillors, like that of Members of another place, has dramatically increased in their dealings with constituents. To some extent that applies to noble Lords, although our activities are supposed to be restricted to what we as peers do to legislation in this Chamber. The overwhelming percentage of queries that local councillors deal with at their surgeries come from local authority tenants from the council estates. The tenants would sooner visit their councillors than compose a letter to the local housing authority. Some may write, but most prefer to keep open the line of communication with their local elected representative to whom they can complain and who will chivvy up and chase the appropriate people.

We would have no qualms about this role being transferred to what we term "approved bodies" or people with expertise in the subject and who know what to do. It is a responsibility they have carried out at a high level over a number of years. We would be extremely reluctant to leave the phrase "another person" in the Bill because we believe that "person" means an individual. We are not prepared to see an individual cast in this role, but prefer to insert "an approved body". On that basis I look forward to hearing the Minister's reply. I beg to move.

Lord Skelmersdale

I believe that the Bill as it stands, together with the amendments proposed by the Government giving tenants an effective veto on the delegation of management, goes a long way towards meeting the concerns expressed by the noble Lord.

The existing requirement in Clause 6 for the Secretary of State to approve the identity of the manager and the terms of the agreement gives quite considerable control over the powers of the local authority to delegate its housing management functions. To introduce further limitations by narrowly defining eligibility for managing agents is, therefore, unnecessarily restrictive.

The clause as presently drafted gives local authorities and tenants the widest possible scope for developing new forms of collaborative arrangement to ensure the proper management of their housing. Some of these forms of management might seek to use private sector skills and expertise and it would be wrong to close off such opportunities when, as must be the case in an agreement under this clause, the local authority and tenants want to try out such an arrangement. Surely we want to support both variety and innovation, not preclude options before the housing authorities and tenants have a chance to consider them.

In practice. of course, the most likely managing agents for schemes of this sort are those set out in the noble Lord's amendment. That, however, is no reason for ruling out a range of other bodies such as building societies or trusts, provided of course that they are acceptable to both the landlord and the tenants, and provided that my right honourable friend is completely satisfied not just about the managerial competence of the proposed management agent but also about the commitment of that agent to the tenants' interest.

I think that some concern about Clause 6 stems from a misunderstanding about what is involved when the local authority delegates some or all of its housing management functions. A management agreement provided for under Clause 6 enables a local authority to agree with someone else for that person or body to carry out housing management functions on behalf of the local authority. Incidentally, on legal advice I understand that "another person" is defined in the Interpretation Act. This does not get us a lot further but perhaps as a result of reading the Official Report we may look it up and both be much the wiser.

A management agreement provided for under Clause 6 enables a local authority to agree with someone else for that person or body to carry out housing management functions on behalf of the local authority, as I have just said. The local authority remains the owner of the house concerned. The tenants continue to be the secure tenants of that local authority. The local authority therefore continues to be accountable for the actions of its agent. Before the Secretary of State will agree to a management agreement, my right honourable friend will want to be completely satisfied that not only are the terms of any management agreement in the interests of the tenants concerned but also that the tenants have been given a proper opportunity to make their views known and are content. This point is being given statutory force in the government amendment requiring tenants to be consulted individually on such proposals and preventing the Secretary of State from granting consent when in his view the majority of the tenants are opposed to the agreement.

Finally I have to say that I see little virtue in requiring a public inquiry, with all the costs in terms of delay and staff resources, to look at a proposal for the delegation of management which must already under this clause as drafted and indeed by definition have the local authority's, the tenants' and the Secretary of State's approval. One cannot get a much more definite exposition of view than that. In view of my explanation of the safeguards already built into this clause for tenants, I trust that the noble Lord will be able to see his way to withdrawing this amendment.

Baroness David

I just wondered whether the Minister was aware of an article in the October 1985 issue of Housing and Planning Review entitled "Sheltered housing—a role for private management". It is really quite an interesting article and I recommend it to him. It shows that these private managers are expanding. One firm which has been doing very well, and I gather has been doing quite a good job of managing in the private sector with sheltered housing, is saying: We are considering a move into the rented sector. A number of local authorities have expressed an interest in 'privatising' their sheltered housing management. We think we may be able to assist". The article comments: Of this we may hear a lot more". Well, it may be all right and it may not if this is expanding at a great rate, but I think that it is slightly alarming if bodies other than approved societies are to have the right to manage local authority estates.

Lord Skelmersdale

The noble Baroness is being unduly suspicious, especially at this time of night. Where all three organisations—the Secretary of State (if I may be allowed to call him or her an organisation), the local authority and the tenants concerned—are wanting to try out a new management team, then I really do not see what there is to be suspicious about.

Lord Dean of Beswick

I have heard what the Minister has said and in view of the time of evening I should like to study later what he has said on this particular occasion. I am not by any means convinced on this question of "another person". I am getting a little repetitive, but, as I have said, we are supposed to be talking about people. It may well be, as the Minister has said, that the tenants themselves may be involved in making the decision, but I remain to be convinced that people will become private landlords on behalf of local authority tenants for the good of the tenants themselves. I fail to see that there are such animals roaming abroad wanting such work. On that basis I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Skelmersdale

moved Amendment No. 53: Page 21, line 12, leave out from ("manager") to end of line 13. The noble Lord said: I spoke to this amendment with Amendment No. 26. I beg to move.

On Question, amendment agreed to.

Lord Dean of Beswick

moved Amendment No. 54: Page 21, line 21, at end insert— ("(6A) Before giving any approval for the purposes of this section, the Secretary of State shall cause to be held a public local inquiry; subsections (2) and (3) of Section 250 of the Local Government Act 1972 (giving of evidence at inquiries) shall apply to such a public local inquiry.") The noble Lord said: I said earlier this evening when we were discussing public inquiries that they would be a recurring theme in various parts of the Bill. I am still of the opinion that there is no more copper-bottomed way of the people involved indicating their views than by having a public inquiry. I stand by what I have said about public inquiries. The same reasons are valid in relation to this amendment. I beg to move.

Lord Skelmersdale

I am interested in the fact that the noble Lord has seen fit to move the amendment, but I fully appreciate why he has done so. I understood that he was speaking to Amendments Nos. 54 and 55 when he moved Amendment No. 52. I know that in Committee this afternoon the noble Lord has zeroed-in, as it were, on the need for public inquiries. I have sought to explain to him that public inquiries are all very well in their context but that in this case they would remove the right from tenants which the Government are keen to give them and about which the Opposition are suspicious. I do not feel that public inquiries are appropriate in this case. Tenants have what I have described over and over again as a veto. What more could tenants want?

Lord Dean of Beswick

The Minister has said that the inquiry would be only at the behest of local authorities and that they would have to be involved. I should like to see what the local authorities have to say about what the Minister said about them before committing myself. On that note, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 55 not moved.]

Lord Skelmersdale

moved Amendment No. 56: Page 21, line 22, leave out subsections (3) to (5) and insert— ("Consultation required before management agreement can be approved. 27A.—(1) A local housing authority who propose to enter into a management agreement shall serve notice in writing on the tenant of each house to which the proposal relates informing him of—

  1. (a) such details of their proposal as the authority consider appropriate, but including the identity of the person who is to be the manager under the agreement,
  2. (b) the likely consequences of the agreement for the tenant, and
  3. (c) the effect of the provisions of this section,
and informing him that he may, within such reasonable period as may be specified in the notice, make representations to the authority. (2) The authority shall consider any representations made to them within that period and shall serve a further written notice on the tenant informing him—
  1. (a) of any significant changes in their proposal, and
  2. (b) that he may within such period as is specified (which must be at least 28 days after the service of the notice) communicate to the Secretary of State his objection to the proposal, and informing him of the effect of subsection (5) (approval to be withheld if majority of tenants are opposed).
 (3) The Secretary of State shall not entertain an application for approval of a management agreement unless the local housing authority certify that the requirements of subsections (1) and (2) as to consultation have been complied with; and the certificate shall be accompanied by a copy of the notices given by the authority in accordance with those subsections. (4) The Secretary of State may require the authority to carry out such further consultation with their tenants, and to give him such information as to the results of that consultation, as he may direct. (5) The Secretary of State shall not give his approval if it appears to him that a majority of the tenants of the houses to which the agreement relates do not wish the proposal to proceed; but this does not affect his general discretion to withhold his approval on grounds relating to whether the proposal has the support of the tenants or on any other ground. (6) In making his decision the Secretary of State may have regard to any information available to him; and the local housing authority shall give him such information as to the representations made to them by tenants and others, and other relevant matters, as he may require. (7) A management agreement made with the approval of the Secretary of State is not invalidated by a failure on his part or that of the local housing authority to comply with the requirements of this section. (8) In the case of secure tenants the provisions of this section apply in place of the provisions of section 105 (consultation on matters of housing management) in relation to the making of a management agreement. Agreements with housing co-operatives under superseded provisions. 27B.—(1) In this section "housing co-operative" means a society, company or body of trustees with which a housing cooperative agreement was made, that is to say—
  1. (a) an agreement to which paragraph 9 of Schedule 1 to the Housing Rents and Subsidies Act 1975 or Schedule 20 to the Housing Act 1980 applied or,
  2. (b) an agreement made under section 27 before the commencement of section 6(2) of the Housing and Planning Act 1986 (which substituted the present section 27).
 (2) A housing co-operative agreement made with a local housing authority which is in force immediately before the commencement of section 6(2) of the Housing and Planning Act 1986 has effect as if made under the present section 27, so that, in particular, any terms of the agreement providing for the letting of land to the housing co-operative no longer have effect except in relation to lettings made before commencement. (3) A housing co-operative agreement made with a new town corporation or the Development Board for Rural Wales which is in force immediately before the commencement of section 6(2) of the Housing and Planning Act 1986 remains in force notwithstanding that the present section 27 does not apply to such authorities. (4) In this Act (except in section 27) the expressions "management agreement" and "manager", in relation to such an agreement, include a housing co-operative agreement to which subsection (2) or (3) applies and the housing co-operative with whom the agreement is made.") The noble Lord said: I spoke to this amendment with Amendment No. 26. I beg to move.

On Question, amendment agreed to.

Clause 6, as amended, agreed to.

Baroness Hooper

This could be a convenient moment to interrupt the Committee proceedings. I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.

House adjourned at sixteen minutes before eleven o'clock.