Housing and Planning Bill

HL Deb 09 October 1986 vol 480 cc358-465

3.49 p.m.

Lord Skelmersdale

My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

Moved, That the House do now again resolve itself into Committee.—(Lord Skelmersdale.)

On Question, Motion agreed to.

House in Committee accordingly.

[The LORD STRABOLGI in the Chair.]

Clause 7 [Proposals for co-operative management or ownership]:

Lord Skelmersdalemoved Amendment No. 57: Page 22, line 4, leave out from beginning to ("insert") and insert ("In Part II of the Housing Act 1985, after the provisions inserted by section 6 above,").

The noble Lord said: I spoke to this amendment with Amendment No. 26. Perhaps it would be for the convenience of the Committee to warn Members that I am about to move en bloc Amendments Nos. 58 to 64, to which I also spoke on Amendment No. 26. I beg to move.

On Question, amendment agreed to.

Lord Skelmersdalemoved Amendments Nos. 58 to 64: Page 22, line 11, leave out ("dwelling-houses") and insert ("houses"). Page 22, line 13, leave out ("offering to buy dwelling-houses") and insert ("proposing that the association should acquire from the authority houses"). Page 22, line 16, leave out ("or offer"). Page 22, line 18, leave out ("at") and insert ("by"). Page 22, line 20, leave out from beginning to ("they") in line 21 and insert ("accepted the proposal in principle,"). Page 22, line 27, leave out ("dwelling-houses") and insert ("houses"). Page 22, line 32, leave out ("dwelling-houses") and insert ("houses").

On Question, amendments agreed to.

Clause 7, as amended, agreed to.

Baroness Davidmoved Amendment No. 65:

After Clause 7, insert the following new clause:

("Ground for possession of a dwelling-house in the event that a relationship breaks down.

.—In schedule 2 to the Housing Act 1985 (grounds for possession of dwelling-houses let under secure tenancies), in Part II (grounds on which court may order possession if suitable alternative accommodation is available), after ground 11 (where the landlord is a charity) insert—

"Ground 11A

The landlord wishes to transfer the secure tenancy of the dwelling-house to—

1. (a) the tenant's spouse (or former spouse); or
2. (b) a person with whom the tenant has been living as man and wife,

who has applied to the landlord for such transfer; and either the tenant or the (as the case may be) spouse, former spouse or person, no longer wishes to live together with the other in the dwelling-house.").

The noble Baroness said: I see that Amendment No. 103 is grouped with Amendment No. 65, but I believe that my noble friend will not be moving that amendment.

Amendment No. 65 deals with the situation arising after there has been a matrimonial or cohabitees' breakup, and the wording is the same as the government clause contained in the current Housing (Scotland) Bill. Its purpose is to determine the future of the matrimonial home following the break-down of the relationship. The amendment covers cohabiting couples as well as married couples, and both parties would be housed.

Representations have been received over a number of years from local authorities, housing associations and voluntary bodies that a change in the law is required in this difficult area. A pressure group of voluntary organisations was set up in 1983 and 1984 and asked for changes in the law.

It is common for tenants to approach their landlord requesting that the tenancy be transferred or that the housing circumstances be determined to favour one or other partner. Often that can be achieved by agreement, usually with the tenancy being determined in favour of the female partner and children, with the male partner being offered alternative accommodation.

I am sure we all agree that the housing position is one of the most urgent matters to be dealt with when there is a relationship break-down resulting in both partners no longer being able to live together. Normally, the housing circumstances are determined through the matrimonial courts. However, this is a lengthy procedure and may be dealt with only after a considerable number of years when the case comes before the divorce courts. There is a considerable gap between the actual relationship break-down and the need to deal with the housing position and eventual settlement of divorce proceedings through the matrimonial court.

We agree with the Government's view as expressed through their clause in the Housing (Scotland) Bill. Public sector landlords should have the opportunity as a step of last resort to seek a notice of possession in the courts to transfer the tenancy to the other partner if they have been approached by that partner with such a request. The existing tenant would, under the proposals set out, be offered suitable alternative accommodation.

In outline, the proposals are as follows. The situation would apply only when one or other of the parties in the relationship dispute applied to the local authority or housing association requesting that their housing circumstances be sorted out. It would then be up to the landlord as to whether they chose to go to the county court for possession to sort out the housing circumstances. If they do, and the court makes a decision, both parties will have to be rehoused. Clearly, only landlords who are prepared to do this will go to court.

The intention of the possession order would be to sort out the desperate housing circumstances in advance of the very long processes of the divorce and matrimonial courts. The housing circumstances might not be sorted out for two or three years, and couples under joint tenancy need assistance if they are unable to agree as to the future of the matrimonial or relationship home. Matters cannot be left for the amount of time that divorce courts take. The Government accepted that argument in Scotland.

I emphasise that the amendment has considerable support across the housing world. It would be voluntary on the landlord (I underline that) whether council or housing association, whether to proceed. It would only work when one or other of the parties requested a determination. This will often involve women who will obtain custody and tenancy of the matrimonial home through this procedure, prior to the divorce court making a decision.

In the past, local authorities have been worried that if this power were obtained they would be forced to house one of the parties in dispute, giving him or her precedence over people who have been on the waiting list for some time. I want to make it quite clear that this power to evict would not come into force and would not be used unless the authority chose to do so. This is a very human issue. What we want to do is to help sort out a very difficult and distressing situation in a shorter time than applies when recourse is made to the divorce and matrimonial courts. I am sure the Committee will have sympathy with that aim.

Why should England and Wales be behind the Scots? It is six years since efforts were made to institute change. Why should we delay longer? I ask the Committee to support this new clause. I beg to move.

Lord Skelmersdale

I readily agree with the noble Baroness that this is a very difficult area; and as she will know, the proposal to make relationship breakdown a ground for possession is by no means new. It was extensively discussed at the time of both the Housing Act 1980 and the Housing and Building Control Act 1984. It was resisted then, principally on the ground that it would be more appropriate for questions about the future of the matrimonial home to be settled by the courts under matrimonial legislation than by a public sector landlord. I hope the Committee will agree that this argument still has considerable force. It is, however, true that matrimonial legislation does not provide a means of assigning the family home to a so-called common-law spouse, which is a problem bound up in this whole general area. There are situations where a spouse is unwillng to take the initiative under matrimonial legislation as it now stands. I recognise that there is widespread support for a new ground for possession along the lines proposed in this new clause. As the noble Baroness said, my right honourable friend the Secretary of State for Scotland has already reviewed the position in Scotland and has concluded that Scottish legislation should be amended to include relationship breakdown as a ground for possession. However, I suggest that it would be wrong to assume that the position south of the Border is necessarily comparable. Matrimonial legislation north and south of the Border is slightly different, as is the housing position in Scotland, where I understand that many more people, proportionately, live in rented accommodation. Furthermore, Scottish local authorities had such a ground, briefly, pending the Matrimonial Homes (Family Protection) (Scotland) Act 1981. Therefore, I do not accept that what we have done in Scotland necessarily requires us to legislate here. I regret, therefore, that I am unable to regard that as a valid precedent.

It is now over five years since public sector tenants gained security of tenure and, conversely, local authorities lost their ability to move tenants around in order to use their stock better. In view of the strength and degree of unanimity of feeling on this issue and the experience that should now be available about how matters are working out in practice, I accept that it is time we had another look at our policy on this point. Indeed, my officials wrote to the London Boroughs Association and the Institute of Housing some time ago, saying as much. Once the pressure of work on this Bill has subsided, my department will be setting up a working party to consider this issue very carefully in relation to the situation in England and Wales. It is, as the noble Baroness and I agree, a complex question involving the interaction of housing and matrimonial legislation, and an assessment of the practical consequences of possible changes must be made.

We need to look at these questions in conjunction with the main bodies concerned, and I am afraid that there was no prospect of our completing such a review in time for any recommendations to be included in this Bill. I realise that this will be a disappointment to those who were hoping to secure changes through this Bill, but I think that this is such a serious issue that it is one which should not be rushed and the approach underlying the proposed new clause may well not be the way to tackle it.

I am not saying that it is not the way; I am saying that it may well not be. For example, I should want to think very carefully about the way in which, under this approach, the partner to whom the tenancy is transferred would still have to go to court under matrimonial legislation to remove the previous tenant's occupancy rights—the rights to live in the matrimonial home—as these would remain even though the partner has ceased to be the tenant.

In view of my undertaking to have this whole matter looked at with all the interested parties, I hope that at this stage the noble Baroness will feel able to withdraw the amendment.

4 p.m.

Baroness Fisher of Rednal

I am a member of this Chamber who also sits in the domestic magistrates' courts and I know that the question of who will take over the tenancy of the matrimonial home, especially when it is a home which is provided by the local authority under renting arrangements, is always a very serious problem that is raised by the solicitors on both sides. As the noble Lord has said, the prime consideration is very often the children. However, I think one also has to take into consideration the question of joint tenancies where husband and wife are named on the rent book as joint tenants and they therefore both have protected status. So whatever is decided about the matrimonial home, both partners are protected and accommodation must be given to the other partner. I should like the noble Lord to make quite sure that that point is also considered by the working party.

Lord Carmichael of Kelvingrove

I should like to ask the Minister whether he will impress on the working party the urgency of this matter. The Committee may have noticed that I also have tabled an amendment, which, in view of what the noble Lord has said, I may possibly withdraw. However, in matters of marital breakdown the question of a place to live is extremely important and urgent for both ex-partners. One of the difficulties of the matrimonial court, as I understand it, and possibly one of the reasons why we in Scotland have taken steps to lead the way yet again, is that the procedure takes a long time. It may be a long time before the court reaches a decision on the disposal of the property, and during that time additional tensions may be put upon the family even when it has broken up.

In the Scottish Bill it is made quite clear that public sector landlords have at least the opportunity, as a step of last resort, to seek a notice of possession from the courts to transfer the tenancy from one partner to the other if they have been approached by that partner with such a request, and an existing tenant, under the proposals as set out, would be offered suitable alternative accommodation. I realise that finding suitable accommodation is a problem for local authorities, and as the Minister has perhaps fairly said it involves jumping over other tenants who are on the waiting list; but in a difficult situation such as the breakdown of a marriage or some other kind of partnership there is great urgency for the provision of accommodation.

I hope that the Minister and his working party will not use this difficulty as a means of delaying what is a very sharp nettle to grasp but which, in the interests of all those concerned, really must be grasped as quickly as possible.

Lord Coleraine

I wonder whether, when the noble Baroness comes to answer the debate, she will indicate why she has proposed to put this ground into the second part of the schedule rather than the third part of the schedule, thereby ousting any right of the county court to look into the reasonableness of the authority's application.

Lord Skelmersdale

Before the noble Baroness responds, perhaps I may reply to both the noble Baroness, Lady Fisher, and her noble friend Lord Carmichael. Perhaps I may be allowed to say to the latter that I am fully apprised of the fact that this matter is now one of great urgency and the delay, which I accept has gone on since 1980, has continued for long enough. Therefore I undertake that the working party will deliberate at such speed as is consistent with the difficulty of the problem. It is not meant to push off to another day something which we all agree is a very difficult problem. The noble Baroness, Lady Fisher, referred to the problem of joint tenancies. I must confess that this is something that had not struck me and I shall make certain that the working party takes it into account.

Baroness David

I am not satisfied with the Minister's reply, because there has been delay over six years. Since 1980, local authorities, housing associations and voluntary associations have been worried about this situation and have been trying to get the department and Ministers to do something about it. There has been stalling already and there is the prospect of another working party being set up. When will we have another housing Bill in which there can be legislation to cope with this problem? There is absolutely no reason why England and Wales should not be taken on the same basis as Scotland, because even if there are fewer rented properties in England and Wales than there are in Scotland, it depends on the tenants themselves and on the local authority whether they choose to go in for this process. I am afraid that I am not satisfied with the Minister's answer, and I shall divide the Committee.

4.6 p.m.

On Question, Whether the said amendment (No. 65) shall be agreed to?

Their Lordships divided: Contents, 93; Not-Contents, 94.

DIVISION NO. 1
CONTENTS
Amherst, E.	Hampton, L.
Annan, L.	Hanworth, V.
Ardwick, L.	Harris of Greenwich, L.
Attlee, E.	Hooson, L.
Aylestone, L.	Houghton of Sowerby, L.
Banks, L.	Hughes, L.
Beswick, L.	Hunt, L.
Bonham-Carter, L.	Ilchester, E.
Bottomley, L.	Irving of Dartford, L.
Briginshaw, L.	Jacques, L.
Brockway, L.	Jeger, B.
Bruce of Donington, L.	Jenkins of Putney, L.
Carmichael of Kelvingrove, L.	John-Mackie, L.
Cledwyn of Penrhos, L.	Kilbracken, L.
Collison, L.	Kilmarnock, L.
David, B.	Kirkhill, L.
Davies, L.	Leatherland, L.
Dean of Beswick	Listowel, E.
Diamond, L.	Llewelyn-Davies of Hastoe, B.
Donaldson of Kingsbridge, L.	Lloyd of Kilgerran, L.
Elystan-Morgan, L.	Mackie of Benshie, L.
Ennals, L.	McNair, L.
Ezra, L.	Mayhew, L.
Fisher of Rednal, B.	Mishcon, L.
Fitt, L.	Molloy, L.
Foot, L.	Morton of Shuna, L.
Gallacher, L. [Teller.]	Mulley, L.
Galpern, L.	Nicol, B.
Gladwyn, L.	Oram, L.
Graham of Edmonton, L.	Paget of Northampton, L.
Grimond, L.	Parry, L.

Pitt of Hampstead. L.	Stallard, L.
Ponsonby of Shulbrede, L.	Stedman, B.
[Teller.]	Stewart of Fulham, L.
Prys-Davies, L.	Stoddart of Swindon, L.
Rathcreedan, L.	Strabolgi, L.
Rea, L.	Taylor of Blackburn, L.
Ritchie of Dundee, L.	Taylor of Mansfield, L.
Rochester, L.	Tordoff, L.
Ross of Marnock, L.	Underhill, L.
Rugby, L.	Wallace of Coslany, L.
Sainsbury, L.	Wells-Pestell, L.
Seear, B.	Whaddon, L,
Seebohm, L.	White, B.
Sefton of Garston, L.	Williams of Elvel, L.
Serota, B.	Winchilsea and Nottingham,
Shackleton, L.	E.
Silkin of Dulwich, L.

NOT-CONTENTS
Alexander of Tunis, E.	Hives, L.
Allenby of Megiddo, V.	Hooper, B.
Ampthill, L.	Hylton-Foster, B.
Beaverbrook, L.	Kaberry of Adel, L.
Belhaven and Stenton, L.	Kinloss, Ly
Bessborough, E.	Kinnaird, L.
Boyd-Carpenter, L.	Knollys, V.
Brabazon of Tara, L.	Lane-Fox, B.
Braye, B.	Layton, L.
Brookes, L.	Long, V.
Brougham and Vaux, L.	Lucas of Chilworth, L.
Broxbourne, L.	Macleod of Borve, B.
Butterworth, L.	Malmesbury, E.
Caithness, E.	Mancroft, L.
Cameron of Lochbroom, L.	Margadale, L.
Campbell of Alloway, L.	Merrivale, L.
Campbell of Croy, L.	Mersey, V.
Carnegy of Lour, B.	Milverton, L.
Coleraine, L.	Molson, L.
Constantine of Stanmore, L.	Morris, L.
Cottesloe, L.	Newall, L.
Cowley, E.	Northesk, E.
Cox, B.	Nugent of Guildford, L.
Craigavon, V.	Pender, L.
Cullen of Ashbourne, L.	Plummer of St Marylebone,
Davidson, V. [Teller.]	L.
De Freyne, L.	Porritt, L.
De La Warr, E.	Portland, D.
Denham, L. [Teller.]	Reay, L.
Dilhorne, V.	Renton, L.
Duncan-Sandys, L.	Rochdale, V.
Eccles, V.	Rodney, L.
Eden of Winton, L.	Romney, E.
Effingham, E.	St. Davids, V.
Elliot of Harwood, B.	Sandford, L.
Elliott of Morpeth, L.	Shannon, E.
Ferrier, L.	Skelmersdale, L.
Fortescue, E.	Strathspey, L.
Fraser of Kilmorack, L.	Taylor of Hadfield, L.
Gainford, L.	Terrington, L.
Glenarthur, L.	Teviot, L.
Gormanston, V.	Thorneycroft, L.
Gray of Contin, L.	Trefgarne, L.
Gridley, L.	Trumpington, B.
Hailsham of Saint	Vivian, L.
Marylebone, L.	Ward of Witley, V.
Halsbury, E.	Westbury, L.
Hesketh, L.	Whitelaw, V.

Resolved in the negative, and amendment disagreed to accordingly.

4.15 p.m.

Lord Dean of Beswickmoved Amendment No. 66:

After Clause 7, insert the following new clause:

("Access to Local Authority Housing

. In section 22 of the Housing Act 1985 (allocation of local authority housing), at the beginning insert—

"(1) In considering whether an applicant for local authority housing is entitled to be admitted to a housing list, a local housing authority shall not impose any requirement concerning

1. (a) the age of the applicant provided that he has attained the age of 16 years; or
2. (b) the income of the applicant and his family; or
3. (c) whether, or to what value, the applicant or any of his family has or has had an owner's interest in a property used as an only or main residence; or
4. (d) whether the applicant is living with, or in the same dwelling as—
1. (i) his spouse; or
2. (ii) a person with whom he has been living as a husband and wife; or
5. (e) any outstanding liability (for payment of rent or otherwise) attributable to the tenancy of any dwelling of which the applicant is not, and was not when the liability accrued, a tenant.

(2) Where an applicant—

1. (a) is employed in the area of the local housing authority; or
2. (b) has been offered employment in the area of the authority; or
3. (c) wishes to move into the area of the authority and the authority is satisfied that his purpose in doing so is to seek employment; or
4. (d) has attained the age of sixty years and wishes to move into the area of the authority to be near a younger relative; or
5. (e) has special social or medical reasons for requiring to be housed within the area of the council,

admission to a housing list shall not depend on the applicant being resident in the area.

(3) In the allocation of local authority housing a local housing authority—

1. (a) shall not impose any requirement concerning—
1. (i) the length of time for which an applicant has resided in its area; or
2. (ii) any of the matters mentioned in paragraphs (a) to (e) of subsection (1) above; and
2. (b) shall not impose a requirement that—

1. (i) an application must have remained in force for a minimum period before the applicant is eligible for the allocation of housing;
2. (ii) a divorce or judicial separation must be obtained; or
3. (iii) the applicant no longer be living with, or in the same dwelling house as, some other person.

(4) In this section 'housing list' means a list of applicants for local authority housing which is kept by a local housing authority in connection with the allocation of housing".")

The noble Lord said: That amendment just got away! I rise to move Amendment No. 66, a new clause, which has been introduced with the support of such housing organisations as Shelter, the National Campaign for the Homeless and CHAR. The clause seeks to make illegal certain policies which have been adopted by local authorities to restrict access to council housing: In doing so, it will bring the legal situation in England and Wales broadly into line with that in Scotland, where certain waiting list restrictions have been illegal since 1980.

There is a need for reform. The need of a man—and when I say "man", I also mean "woman"—for council housing is not affected by local authority boundaries or by the length of time a person has lived or worked within them. This comes from the report Selection of Tenants, issued by the Ministry of Health in 1949, and it sums up the fundamental objections to policies which arbitrarily restrict access to council housing. These are that waiting list restrictions are unfair because they lead to councils denying help to people in desperate need of housing. The need would often be recognised by the council's own priority schemes if the application were properly considered. They are inefficient in that the arbitrary nature of restrictions prevents councils channelling resources to those sometimes in the greatest need of help. Thee restrict mobility because local authority boundaries, and therefore the waiting list policies which are based on them, are increasingly irrelevant in terms of labour and housing markets. We see that more than ever today in trying to introduce a better mobility into housing because of our serious unemployment.

Why is this legislation needed? Central government first recommended the end of waiting list restrictions some 35 years ago. Over 15 years ago. the Cullingworth Committee recommended that legislation should be enacted. This was accepted by the Government in 1977 and legislation was introduced in Scotland in 1980. This has clearly caused few problems, as the Government have tabled clauses in the Housing and Planning Bill currently before Parliament which further strengthen Scottish legislation. There seems to be no reason why similar provisions should not be extended to England and Wales.

What do we believe the legislation should seek to do? The idea that central government should lay down a national scheme of allocation to be adopted by all authorities has rightly been rejected. However, there is general agreement that, although the determination of priorities should remain the responsibility of the local authority, to be decided in the light of the housing problems of its area, access to council waiting lists should be made as open as possible. As the Cullingworth Committee said, only if all applications are admitted is it possible to assess needs.

This new clause would not result in open waiting lists, but would mean that in many areas access to council housing would be considerably wider than at present. I ask the Committee, however, how we calculate what the real housing need is when there are severe restrictions still being operated which are unfair and unjust. To achieve this fairness and justice, two main rights are involved. One is the right to register an application, as it is sometimes put, "to be admitted to the waiting list". But as the Cullingworth Committee noted, this is not enough in itself. Restrictions can be reintroduced by means of criteria which must be satisfied before applications are considered for rehousing.

One of the great strengths of Scottish legislation is that it outlaws rules that restrict admission to the waiting list and consideration for allocation. It is important that any legislation enacted in England and Wales should also incorporate that principle.

The new clause is modelled closely on the Scottish legislation. About 15 years ago I was chairman of one of the largest housing authorities in the country. We then opened our waiting list completely. Our proposals at that time were liberal. We were determined to find out Manchester's real housing need. We dropped the age qualification to 18 when 18 became accepted as the age of an adult. There was a dramatic increase in the number of people applying for housing.

Only a few years ago in some large housing authority areas a person had to be 25 years or over to register for housing. I do not know whether any of those authorities are left, but if they are, that is nonsense.

One of the biggest increases in demand for accommodation has come from single young people. The fashion is increasing for young people, as soon as they reach maturity, to want to make their own home. With the price of housing these days there is little prospect of that unless the father and mother have substantial resources that they can make available to their son or daughter. Their only hope may be to get onto a local authority housing list.

As it states in the new clause, we believe that the age limit for an applicant should be over 16. The time has now come to reconsider the whole matter and make the list as open as possible to identify genuine housing need. We have heard successive Ministers say that no one has had the time or can assess the need. I do not say that the new clause would give us the complete picture but it would give basic justice to those people who are being denied it and it would give a far truer indication of housing need. I beg to move.

Lord Skelmersdale

I am extremely interested in what the noble Lord said and especially the remarks he made at the beginning of his speech when he talked, if I understood him correctly, about the illegal manipulation of the lists. Such an illegal manipulation can of course be challenged in the courts. The Committee may have heard of a recent case where an applicant successfully challenged, by judicial review, Canterbury Council's refusal to admit her to the waiting list; and so we do not need this new clause to deal with that point.

Lord Dean of Beswick

The person involved in that exercise was obviously someone who knew of the right and was literate and articulate enough to take that course. In the main we are talking about people who would not pursue that course and that is why I am pursuing this matter.

Lord Skelmersdale

That is a fair point. Equally, if I read it aright, under the new clause the matter would have to go to court and someone would have to take it to court. Obviously the local authority will not take it to court.

I both understand and sympathise with the motives behind so much of what has been said in support of the amendment. The basic principle underlying access to local authority housing ought to be housing need. Restrictions which are not related to housing need conflict with that broad objective. Such restrictions also constitute barriers to peoples' ability to move from one part of the country to another. To that extent, I agree with the noble Lord.

I am by no means certain that in practice this new clause will help to house people, which is what we all want. It will place extra restrictions on the way in which local housing authorities can manage their stock, and increase burdens on local authorities at a time when we are seeking to lighten their load. Waiting lists would become longer but local housing authorities would not be able to allocate their houses any more quickly. People would stay on waiting lists longer and authorities in popular areas would come under attack because local people would find outsiders in the queue.

From my original reading of the amendment, I suspected that it was so widely drawn that even I could get onto the housing list. I took legal advice on that point and discovered that that was right. I do not know whether that is the noble Lord's intention but that is the effect of the amendment. I am not sure that it is proper that I should be allowed onto a housing list.

We have tackled the problem in other ways. Local housing authorities are already bound by law to give preference to those in dire need; for example, those found to be homeless or those living in unsatisfactory housing conditions. We have set up the national mobility scheme to help those with a real need to move from one authority to another for employment, social or medical reasons. All but two authorities in England and Wales—Liverpool and Torquay—take part in the scheme. It has so far helped over 30,000 people to move, excluding moves within London. We have also set up the tenants' exchange scheme and backed it by giving tenants a statutory right to exchange homes. We are supporting measures to make the national mobility scheme more effective, and both schemes are being reviewed to see what further improvements can be made in public sector mobility.

The noble Lord mentioned Scotland. I am well aware of the differences between the legislation on waiting lists and allocation policies north and south of the Border. In that respect, as in so many, Scottish law is different, reflecting different needs and structures north of the Border. That is as it should be. At the moment, howver, we are prepared to leave those matters to the discretion of local housing authorities in England and Wales. The Committee has heard me ask before what local authorities are for. That was a broad-based question, but in this context, it should be for local authorities to make such decisions.

Housing authorities have the discretion. I understand that some take the view that they can run a so-called waiting list free from all restrictions. That is for them to decide in the light of their knowledge of their housing stock and of their local problems. Other local authorities think and behave differently. I suggest that is right and proper. I welcome that flexibility. I hope that all authorities will review their list and allocation procedures and seek to remove all unnecessary restrictions.

The Bill approaches the underlying problems positively. We have taken steps to enhance tenants' mobility. I recommend that the Committee rejects this new clause restricting local authorities' discretion.

4.30 p.m.

Baroness David

The Minister said that he himself under the proposed clause, could get on the waiting list. I take it that he meant as an owner-occupier.

Lord Skelmersdale

No; I meant that since I am living and working in Westminster, I would be very unlikely to get a house—this was the point I was seeking to make—but I would be able, under the proposed clause, to get on Westminster's housing list.

Lord Pitt of Hampstead

If people are in need, Westminster will rehouse them. If they are not in need, Westminster will not rehouse them. One does not start by saying that John Smith does not need, and, therefore, should not be provided with, accommodation. John Smith applies. John Smith's name is put on the list. John Smith's needs are then assessed. When it is discovered that John Smith is really in need, John Smith is given a house, I cannot understand this point. For the second time we have had an example of good Scottish legislation working well in Scotland. We are asking that it should be adopted in England and Wales, but this is refused by the Government. We get the same answer that the conditions are different across the Border. I do not know that conditions are so different on each side of the Border.

The Minister began very well when he pointed out that housing should be given to people most in need. In order that people most in need get the housing we should have as open a waiting list as possible. I accept that when people put their names down this will in the first instance enlarge the waiting list. We accept that some people putting down their names will not be in great need and will not therefore have to be rehoused. That is accepted. One can never have a fool-proof scheme. What one can have, however, is the opportunity for all people who feel in need to put down their names. At the moment there are a considerable number of restrictions as to age, income and how long people have been living in the area. These restrictions do not help. If one is in great need but has not been living in the area very long, one is still in need. One needs, therefore, to be on the list.

Income is not as safe a means of assessment as people think. A person's income may be very good today and very bad tomorrow. It is not therefore as safe a level of assessment as one might think. The intention behind this amendment is to try to get waiting lists as open as possible. All that is suggested is that local authorities should not be allowed to use certain restrictions that they are now exercising, so that more people will feel free to get on the waiting list and will actually get on the waiting list. The question of need will be assessed. Those in greatest need will have priority on the waiting list.

Noble Lords have heard me talk more than once about homeless people who are made to live in bed and breakfast accommodation. I would think that they should have high priority on those lists. That is not, however, the point, The issue is having lists as open as possible. I accept that they cannot be completely open. We should, however, try to get as close as possible to open waiting lists. If a system is working quite well north of the Border, I cannot see why we should say that we do not want it on this side of the Border. I cannot understand that attitude at all.

Lord Boyd-Carpenter

I am a little surprised to find this amendment coming from the other side of the Committee. On Bill after Bill, over the last few years, we have had moans and protests from noble Lords and noble Baronesses opposite that the Government were taking away the discretion of local authorities, were taking away their authority, were overriding them and taking away their functions. Now, when the Government propose to leave the important function of entry on their housing lists to local authorities, up gets the noble Baroness and up get noble Lords opposite to say that they must be restricted.

Of course, we want to see that local authority housing goes to those in greatest need. But who is to decide this? Who is supposed to know best the needs of a particular area? I am not a wholly uninhibited admirer of much of local government. If, however, local government is to have a function, it surely must be deemed to know the needs of its area better than—I say this with respect—my noble friend on the Front Bench or his department.

I should have thought it much better to leave the question of eligibility for the housing list to the local authority that will administer it. In any event, I should have thought that the amendment, if carried into the Bill, would be utterly ineffective. Although it would compel local authorities to admit to the housing list people in categories which meant that they did not think they should be on it, it would not prevent a local authority, in exercise of its power of allocation, applying privately and surreptitiously its own principles. We do not want to drive local authorities into doing things privately or surreptitiously. If they think that certain categories should have local authority housing available and others should not, it is much better to be above board and to say so. If this amendment was accepted, the local authorities would not be able to do so. On this occasion I am on the side of the local authorities.

Lord Elystan-Morgan

With great respect to the noble Lord, Lord Boyd-Carpenter, I think that, on this occasion, he misconstrues the meaning of the word "discretion". A local authority is basically a creature of statute. It is there to carry out statutory obligations laid upon it by Parliament. The obligation with which we are concerned here is the obligation to house people who are in need. Parliament could, of course, have laid down detailed rules so that there would be iron-bound regularity as to what each local authority in England, Wales and Scotland did. It has not done that. It has declared the general principle.

There is a discretion in the sense that if a local authority finds that there does not seem to be any need as Parliament understands it, it can, of course, let its houses on a basis of non-need. In other words, it can be more generous than the line that is drawn by statute. But that is not what the issue is about.

The issue is about whether it is entitled to be less generous than statute ordains. If statute ordains that there is a general obligation to house people in need and a local authority says—I take the example given by my noble friend Lord Dean of Beswick—that no one under the age of 25 shall apply, that local authority is writing its own law. That local authority is saying to itself that people aged between 18 and 25—assuming that all other local authorities start at 18—are to be banned from the protection given to them generally by Parliament. This is exactly. as I understand it, what this amendment is about. The amendment makes it unlawful for local authorities to write their own law. When local authorities write their own law that is not—with respect to the noble Lord, Lord Boyd Carpenter—the exercise of discretion.

The second point is the Scottish one, covered very much by general principle. It is not conditions arising from the historic development of Scottish law that is different from English law which demand that there should be a different pattern. A certain standard is imposed north of the Tweed. It is the standard that I have sought to describe in relation to the amendment. In my submission that standard should likewise be applied south of the Tweed.

Lord Broxbourne

May I—

Lord Boyd-Carpenter

Perhaps my noble friend will allow me to reply, since the noble Lord opposite challenged me. The noble Lord, Lord Elystan-Morgan, very uncharacteristically for him, if I may say so, missed the point. The point is not whether or not local authority housing should be allocated according to need; that Parliament has laid down. The point that arises on this amendment is, who is to be the judge of that need?

Let us take the example that the noble Lord quoted. It may well be that in its own special circumstances—perhaps the existence of a very large number of elderly people with grave housing needs—a local authority might well take the view that it was not going to accept applications by those under 25, given its own particular circumstances. I do not see how anybody in this Chamber, or, with great respect, in my noble friend's department, can have the detailed knowledge of the needs of an area which is half as good as that of the local authority concerned. That is the point.

Obviously the job is to deal with need. But the question is whether or not a local authority is the best judge of that need. If its judgment is on these lines, it is wasting everybody's time and raising false hopes if it accepts on its housing list people it knows it is not going to house.

Lord Elystan-Morgan

Perhaps I may deal with this one matter very briefly. The noble Lord, Lord Boyd-Carpenter, has been the object of my admiration for a very long time. He is a very experienced and skilled parliamentarian and a very brilliant debater. But he knows, as well as every other Member of this Committee, that the argument he has put forward on this occasion is a specious one. Of course one cannot define a matter in such a way that it will have exactly the same meaning in thousands of different situations in every local authority in England, Scotland and Wales. But when Parliament says that need has to be met, full stop; that does not mean that it is lawful to exclude persons between 18 and 25. If Parliament had intended that to be the situation it would have said so.

Therefore our case, which I put forward with total sincerity, is this. If one is talking about a gloss on what is "need", if one is trying to allocate resources which are in extremely short supply, a local authority has a discretion. It is a discretion that is brought upon it by the force of circumstances—and perhaps "discretion" is rather a cruel word to use in that context. Nevertheless what it must not do is to do less than to carry out the duty which Parliament has imposed upon it.

It may be that the noble Lords opposite consider that this amendment has been drafted with too wide a scope. That is a totally different matter. But the necessity to see that a local authority is not allowed by law to contract out of its basic and fundamental obligation is I think extremely important. That, as I understand it, is what the amendment is about; it is not a matter of discretion.

4.45 p.m.

Lord Mayhew

It is an extremely brave man who intervenes in a discussion between lawyers of such subtlety as the two noble Lords. I draw swords with the noble Lord, Lord Boyd-Carpenter, when he says that we are dealing with the test of need. I think it can be argued that it is the allocation which is the test of need rather than the placing of names on the list.

However, on the point made by the other noble Lord, I totally fail to understand how this amendment does not limit the powers of local authorities. Of course it limits the powers of local authorities. It may be that under existing legislation they can or cannot accept certain categories of people on to their list. Under this amendment they are compelled to do so. Their choice is taken away from them. To that extent, whatever the constitutional argument, the commonsense argument is that this amendment limits the powers of local authorities. Certainly on these Benches we are entirely opposed to any further decisions taken in local matters by the men who know best in Westminster or Whitehall. This is a serious objection to this amendment.

Lord Broxbourne

The noble Lord, Lord Elystan-Morgan, is right in saying that local authorities are the creatures of statute. But he also says that local authorities do not have an unfettered discretion. Of course it is not unfettered as the law stands. Clearly the statute gives clear guidelines to local authorities. One has only to look at Section 22 of the Housing Act 1985: A local housing authority shall secure that in the selection of their tenants a reasonable preference is given to persons occupying insanitary or overcrowded houses"— That is a quite specific fetter on the discretion of local authorities. Then: persons having large families". That is another specific fetter, a guideline which they must obey. I would venture to think that all noble Lords would consider that those are reasonable requirements in the statute. The Act also refers to: persons living under unsatisfactory housing conditions". Again, the same applies there.

The fourth guideline is: persons towards whom the authority are subject to a duty under section 65 or 68", which, as the noble Lord knows, deals with questions of homelessness. Those are duties imposed by statute on the local authority which it is bound to observe being, as the noble Lord has said, a creature of statute.

The question with which the Committee is now faced is this. Are those requirements reasonable? Do they strike a proper medium between giving appropriate guidance to local authorities as to the method of allocation, and, on the other hand, fettering their discretion to such an extent that the central government is usurping the position and functions of the local authority? I would venture to think that most noble Lords would agree with the noble Lord, Lord Mayhew, that it is a possibility which is undesirable according to our constitutional practice.

There may not be any absolutely perfect academic answer to this. But if we approach it in that way—by looking at the statutory guidelines which are in force and the desirability of giving local authorities which are conversant with the problems of their area at first hand a reasonable discretion within those parameters—then I would venture to think that the law has got it about right and that it would not be improved by the amendment of the noble Lord. However good the intent of the amendment—and I have no doubt as to that—it would trespass on to the other side of the equation and unduly fetter the discretion of local authorities.

Baroness David

I wonder whether I may return to the point I made some minutes ago about owner-occupiers. I was wondering about the reason why the Minister said he could get on to a list. I wonder whether the noble Lord is aware of his own department's report on the allocation of council housing, which noted that a blanket prohibition on either the registration or consideration of owner-occupiers is difficult to justify since it may exclude many with very genuine housing problems.

I know from my experience of my own authority that many very elderly owner-occupiers are applying for council accommodation because they find their own houses are too big for them. If council accommodation is available to the elderly—and we emphasise how necessary it is for councils to have accommodation for the elderly—this will release larger houses which may then be available perhaps for families.

However, I must make the point that I do not think we are interfering with the discretion of local authorities in this way. We should he interfering with the discretion of local authorities if we were telling them how to allocate their houses and what their priorities should be. These are not affected one little bit by this amendment. This amendment will help to find out the real housing need in every local authority. That is a very important factor not only for the local authority but for the country to know.

Lord Skelmersdale

That is all very well, but the point I was making was that I have read my department's report and have understood clearly what it says. But I cannot see any justification for me, at my age, as an owner-occupier elsewhere in the country, being allowed to join a waiting list, for a possible house in Westminster. I honestly do not think it would be right and I am sure many noble Lords would agree with me.

Baroness David

The noble Lord would be very low down the list!

Lord Dean of Beswick

First, let me disabuse the Minister of a point he made in his first intervention in this debate. He said that the proposal would not solve the housing problem, implying that I was the one who said it would. I never said that at all. I said that it would more clearly identify the national housing problem. I did not say it would go any way to solve it. However, I find it strange that people would support a continuation of the present situation, where, for example, in some areas people over 60 years of age, unless they have lived all their lives or a number of years in that area, are not allowed to register. I do not think the new clause attempts for one moment to interfere with the discretion of local authorities.

I was interested to hear the intervention of the noble Lord, Lord Mayhew, but I think he had the point completely the wrong way round when he said that he and his party—I assume he is talking for the Alliance—were bitterly opposed to telling local authorities what to do. This amendment is not attempting to do that. The Alliance are supposed to be in favour of individuals, and this is an attempt to give a basic right to people to put their names down on a housing list if they so desire. I have no wish at all to interfere with whether they get a house or whether they are included in the criteria. That lies fully with the housing authorities concerned, because they run their own area.

I still believe that we are not attempting to interfere with the council; other than to say that if people come to its area, they are all equal. We think that in a freestanding democracy people over 16, people over 60, whatever their income group, whether the reason is to work there, or to seek work there, are entitled to be considered. That is all it is about. I am sorry that the Minister could not have been a bit more positive in his answer. I beg to move.

4.54 p.m.

On Question, Whether the said amendment (No. 66) shall be agreed to?

Their Lordships divided: Contents, 70; Not-Contents, 106.

DIVISION NO. 2
CONTENTS
Amherst, E.	Llewelyn-Davies of Hastoe, B.
Ardwick, L.	Longford, E.
Banks, L.	Lovell-Davis, L.
Beswick, L.	McNair, L.
Bottomley, L.	Mishcon, L.
Brockway, L.	Molloy, L.
Bruce of Donington, L.	Morton of Shuna, L.
Carmichael of Kelvingrove, L.	Mulley, L.
Cledwyn of Penrhos, L.	Nicol, B.
Collison, L.	Oram, L.
David, B.	Parry, L.
Davies, L.	Pitt of Hampstead, L.
Dean of Beswick, L.	Ponsonby of Shulbrede, L.
Donaldson of Kingsbridge, L.	[Teller.]
Elystan-Morgan, L.	Prys-Davies, L.
Ennals, L.	Rathcreedan, L.
Ewart-Biggs, B.	Rhodes, L.
Ezra, L.	Ritchie of Dundee, L.
Fisher of Rednal, B.	Ross of Marnock, L.
Fitt, L.	Sefton of Garston, L.
Gallacher, L.	Serota, B.
Galpern, L.	Shackleton, L.
Graham of Edmonton, L.	Silkin of Dulwich, L.
[Teller]	Stallard, L.
Gregson, L.	Stewart of Fulham, L.
Grimond, L.	Stoddart of Swindon, L.
Hooson, L.	Strabolgi, L.
Hughes, L.	Taylor of Mansfield, L.
Hunt, L.	Tordoff, L.
Jacques, L.	Underhill, L.
Jeger, B.	Wallace of Coslany, L.
John-Mackie, L.	Wells-Pestell, L.
Kilbracken, L.	Whaddon, L.
Kirkhill, L.	White, B.
Leatherland, L.	Williams of Elvel, L.
Listowel, E.	Winterbottom, L.

NOT-CONTENTS
Alexander of Tunis, E.	Kinnoull, E.
Allenby of Megiddo, V.	Knollys, V.
Ampthill, L.	Lane-Fox, B.
Beaverbrook, L.	Layton, L.
Belhaven and Stenton, L.	Long, V.
Beloff, L.	Lothian, M.
Bessborough, E.	Lucas of Chilworth, L.
Bolton, L.	Macleod of Borve, B.
Boyd-Carpenter, L.	Malmesbury, E.
Brabazon of Tara, L.	Mancroft, L.
Braye, B.	Margadale, L.
Brookes, L.	Maude of Stratford-upon-
Brougham and Vaux, L.	Avon, L.
Broxbourne, L.	Merrivale, L.
Buckinghamshire, E.	Mersey, V.
Butterworth, L.	Milverton, L.
Caithness, E.	Molson, L.
Cameron of Lochbroom, L.	Monk Bretton, L.
Campbell of Croy, L.	Monson, L.
Carnegy of Lour, B.	Montagu of Beaulieu, L.
Coleraine, L.	Morris, L.
Constantine of Stanmore, L.	Mottistone, L.
Cottesloe, L.	Moyne, L.
Cowley, E.	Newall, L.
Cox, B.	Norrie, L.
Craigavon, V.	Northesk, E.
Cross, V.	Nugent of Guildford, L.
Cullen of Ashbourne, L.	Pender, L.
Davidson, V. [Teller.]	Perth, E.
De La Warr, E.	Plummer of St Marylebone,
Denham, L. [Teller.]	L.
Dilhorne, V.	Porrit, L.
Eden of Winton, L.	Portland, D.
Elliot of Harwood. B.	Reay, L.
Elliott of Morpeth, L.	Rochdale, V.
Elton, L.	Rodney, L.
Ferrers, E.	Romney, E.
Fortescue, E.	St. Davids, V.
Fraser of Kilmorack, L.	Salisbury, M.
Gainford, L.	Sandford, L.
Glenarthur, L.	Seebohm, L.
Gormanston, V.	Skelmersdale, L.
Gray of Contin, L.	Strathspey, L.
Gridley, L.	Swansea, L.
Hailsham of Saint	Swinfen, L.
Marylebone, L.	Terrington, L.
Halsbury, E.	Teviot, L.
Henderson of Brompton, L.	Thorneycroft, L.
Hesketh, L.	Trefgarne, L.
Hives, L.	Trumpington, B.
Hooper, B.	Vickers, B.
Howe, E.	Vivian, L.
Hylton-Foster, B.	Ward of Witley, V.
Kaberry of Adel, L.	Whitelaw, V.
Kinnaird, L.

Resolved in the negative, and amendment disagreed to accordingly.

5.2 p.m.

Lord Dean of Beswickmoved Amendment No. 67:

After Clause 7, insert the following new clause:

("Disposal of land held for housing purposes: preservation of rights of secure tenants.

In Section 32 of the Housing Act 1985 insert— (6) Where a disposal is to be subject to an existing tenancy or tenancies, the Secretary of State shall not give any consent for the purposes of this section unless he is satisfied that agreement has been reached as part of the disposal arrangements to secure the preservation and continuation in force after such disposal of the rights granted to secure tenants by part IV of this Act.".").

The noble Lord said: I beg to move Amendment No. 67 to insert the new clause. Referring to the reasons for the insertion of this new clause, I commence by asking the Committee what rights council tenants would have if their homes were handed over to another landlord. Under Clause 4 of the Bill, their right to buy their homes and their right to a council mortgage would be preserved. However, most tenants' other rights granted under the tenants' charter in the Housing Act 1980–for example, tenants' rights of information and consultation about their landlord's housing management policies—could be removed by their new private landlord.

If tenants' right to buy their homes is protected, it is difficult to see why tenants' other statutory rights under the tenants' charter should not also be protected in law. That is what we hope to achieve with this amendment.

The Government's stated aim in encouraging councils to hand over management and ownership of their estates is to encourage local organisations such as tenants' co-operatives and housing associations to manage tenants' homes in a way which makes tenants more accountable. That appears in a consultative paper issued by the Department of the Environment on 29th November 1985. Surely if the aim is to give tenants more control of the way in which their homes are managed, their basic statutory rights to be informed and consulted about the way in which their homes are managed should be protected on the transfer of their homes to the new landlord.

The Government may claim that this amendment is unnecessary because approval would not be given for tenants' homes to be handed over by councils to new landlords without tenants' existing rights being substantially protected. If so, the Government cannot reasonably oppose such safeguards being included in the primary legislation.

Clause 4, as it stands, implies that those who wish to buy their home deserve much greater rights in law than those who wish to remain tenants. There is no reason why those who wish to remain tenants should be treated less favourably, and this amendment would ensure that they retained the same protection in law. This amendment ensures that all the rights which council tenants have in statute would be protected if their homes were transferred into the ownership of another landlord. Council tenants have a number of important statutory rights which were granted by the Conservative Government under their tenants' charter, granted under the Housing Act 1980 and extended under the Housing and Building Control Act 1984.

The tenants' charter rights that tenants have include the following: the right to buy their home at discount; the right to be consulted by their landlord about matters affecting their home or tenancy; the right to be informed about their statutory rights and about their landlord's rights and obligations—for example, to maintain their home in good repair; the right to exchange their home with another tenant, to take in lodgers, and to sublet; the right to reimbursement by their landlord for certain repairs to their home, which is known as the right to repair. In addition to those rights, council tenants also have the statutory right to be charged no more than a reasonable rent for their home by their landlord.

None of these rights exists in statute for tenants of private landlords. Therefore, what would become of tenants' statutory rights if their home were transferred to another private landlord? Clause 4 would protect tenants' right to buy their home and their right to a council mortgage, but all tenants' other statutory rights granted by the Conservative Government under the tenants' charter in the Housing Act 1980 could be removed by their new landlord, as these would not be protected in statute. Nor would tenants have a right to be charged a reasonable rent by their new landlord. Instead, tenants would have to pay what the rent officer considered to be fair—probably including additional and extra service charges—which in many parts of the country would be much higher than tenants have paid to their council as their landlord.

If tenants' right to buy their homes at a discount is protected by statue on transfer, we ask: why should tenants' other statutory rights not also be similarly protected? The Government may say that this amendment is unnecessary; that tenants would have to take the possible loss of their statutory rights into account in deciding whether they wished their estate to be transferred to a private landlord. We say that that argument is inadequate because there is no requirement that tenants should be fully informed of the possible loss of their statutory rights by their council if it is contemplating transfer, and tenants are unlikely to wish to opt out of their statutory rights to protection against arbitrary decisions by their landlord. We say that the rights were given in the first place to prevent local authorities taking arbitrary decisions against tenants. Why would another landlord be expected to behave differently? I beg to move.

Lord Skelmersdale

Yet again I fully understand the noble Lord's aim in moving this amendment, which is to be fair to council tenants affected by proposed sales to a third party. However, I hope that on this occasion at least I can convince the noble Lord that not only is his amendment unnecessary but that it could in some cases frustrate the wishes of the very people it is intended to help; namely, the tenants themselves.

I do not particularly want to go into ancient history, but perhaps I shall have to because the noble Lord has what my sister's godfather used to call an excellent "forgettery". It is unnecessary because the government amendments which the Committee agreed should be made will give council tenants affected by a sale to a private landlord, in effect, a right to veto if the majority can show that they do not wish the sale to proceed. That means that the tenants can weigh for themselves the advantages to be derived from such a sale—for example, the early improvement of their homes against any loss of rights they previously enjoyed as council tenants.

In Committee on Tuesday Members opposite sought to cast doubt on the effectiveness of the veto given to tenants under the Government's amendment. It may therefore be helpful if I repeat the basic principles applied in the new consultation provisions which the Committee has agreed should be included in this Bill. A local authority which proposes to sell tenanted dwellings to a private-sector landlord will be required by law to consult the tenants affected. The local authority will be required to give the tenant details of the proposal in writing. This includes the name of the likely purchaser and the likely consequences of the sale for the tenant; for instance, in respect of the rent that the tenant will be required to pay.

Furthermore the local authority will be required to notify the tenants of the preservation of their right to buy by Clause 4 and their right to object to the sale, informing them in doing so that the sale will not be able to proceed if the majority of the tenants indicate to the Secretary of State that they are opposed to it.

Lord Dean of Beswick

I am aware of everything that the noble Lord has said. We have been through it before. But is he also saying that if such an operation occurs and the sale takes place by a majority vote of the tenants, the minority would give up their statutory rights within the terms of the sale?

Lord Skelmersdale

If the sale takes place it can only be with the consent of the majority of the tenants. Inevitably, as with a general election, a council election or anything else, if there is a majority, by definition, there must be a minority.

Lord Dean of Beswick

The Minister is saying then that if it was a 51 per cent. to 49 per cent. verdict in favour of selling the tenancies, the 49 per cent. will lose all their statutory rights. That is what this is about.

Lord Skelmersdale

Maybe, but perhaps the noble Lord has forgotten that no government since the war have been elected by more than 50 per cent. of the voting population, so I do not see that there is validity in that argument. I would add that under the provisions that the Committee has already approved the local authority will have to certify to the Secretary of State that all the tenants affected have been consulted, and such certificate must be accompanied by copies of the consultation documents served on the tenants. If the Secretary of State is not satisfied that tenants have been given adequate information he will have the power to require the local authority to carry out further consultations.

By no stretch of the imagination can these provisions be held to be inadequate or unfair. As I have already said, it will be open to the tenants directly involved to weigh the advantages and disadvantages of a proposed sale. If they are not satisfied with the scheme, possibly because they will lose some rights they previously enjoyed, they will have the means to prevent the sale proceeding if enough of them agree that this is the one thing that should stop the sale from proceeding.

Furthermore potential private sector purchasers will be aware of the need to secure the support of the tenants if they are to be able to buy tenanted council properties. Some private sector landlords may feel able to safeguard all the rights previously enjoyed by the tenants under the Housing Act. Others may not feel able to go quite so far in this direction, but the tenants might nevertheless be happy for the sale to proceed.

The sale may have other major advantages for the tenants. This is particularly likely where the tenants themselves are to be represented on a special company or body set up specifically for the purpose of acquiring, improving and managing a former council estate. Thamesmead is a good example of just such a case. In these circumstances, tenants may well feel that it is unnecessary for such rights as the right to repair to be safeguarded.

However, this amendment would remove any flexibility in the matter, and as a consequence it is possible that it could deter potential purchasers and some sales will not go ahead even though the tenants concerned are happy that they should do so. This cannot be right.

5.15 p.m.

Lord Dean of Beswick

I totally disagree with what the Minister is saying in his analysis of this matter. He knows that we extensively discussed what the format would be in the organisation of these ballots and how the verdict would be conveyed to the Minister as to the tenants' wishes. But is it not true that a lot of ballots of this type are affected by what is put on the ballot paper?

Does the Minister think that a local authority that wants to get rid of 400 or 500 houses on a problem estate would take the trouble to put on the ballot form, "You must understand that if you vote for this proposal you will have no protection in housing law. You will lose the whole of your rights if your new owner so desires"? I do not believe that a local authority indulging in this policy would do so.

It would be monstrous, on the basis of even a substantial majority vote, for 25 per cent. of the people on an estate, who may have occupied houses since the last war—people who fought in the last war, whom I have met down here on delegations—to have their historic rights as protected council house tenants removed by some action to which they were absolutely and diametrically opposed.

As I mentioned on Tuesday, it has been said throughout history, and in your Lordships' House on numerous occasions. that an Englishman's home is his castle. The last time it was said in this place was by the noble and learned Lord, Lord Denning. For the Minister to say that the Government are in support of people losing the rights that they have at present if there is a majority verdict to sell the house in which they live when they have voted the other way is scandalous. It is not the way we do things in Britain.

Lord Skelmersdale

I do not know whether the noble Lord was working himself up to ask the opinion of the Committee. Before he gets to that point it is only fair to tell him, that sitting tenants, on disposal, do not lose "all their statutory rights". They will become Rent Act tenants and have the preserved right to buy. I should have thought that those were valuable continuing rights.

The final decision will rest with the Secretary of State even though the majority of tenants may support the sale. If he is not satisfied that the terms are reasonable in the light of representations from tenants—that is, from the minority—he may decide not to grant his consent. But each case will have to be considered on its merits.

It is worth pointing out that as the tenants of a private sector landlord they will enjoy security of tenure under the Rent Act and will have other rights; for example, in relation to succession for council tenants. By succession I mean the right to inherit a tenancy from your mother, father or whoever else it happens to be.

Lord Dean of Beswick

Succession of tenancy.

Lord Skelmersdale

Indeed, I thank the noble Lord.

Lord Dean of Beswick

I shall not say that the Minister becomes more glib, because it is not a very nice word, but he becomes more misunderstanding of the facts of what take place in council houses. He said one of the prime things the tenants would retain was the right to buy the house. Is it not obvious that anybody who was going to buy his house would have bought it already? Most of the people we are talking about have chosen to remain as tenants of municipal housing. They are not prospective buyers, or they would already have bought under the generous scheme that the Government have offered—unless, of course, the government amendment that was tabled to give the Secretary of State the right to move the points of discount upwards means that eventually the Government have in mind giving them away. I cannot see any reason to make it a point in an issue of this kind that the tenants of the properties involved will retain the right to buy, because, in my opinion they are not potential buyers to start with.

Baroness Fisher of Rednal

I am concerned with the point that my noble friend Lord Dean is making. It was this Government who brought out the tenants' charter in the Housing Act 1980. The noble Lord perhaps will remember that we were both involved with that particular Act. The tenants' charter was brought out there, obviously, because the Government felt that the needs of the tenants required to be protected more than they had been in the past. The tenants' charter was once more extended (and again by this Government) under the Housing and Building Control Act 1984, the Government once again making quite sure that tenants were protected whether they were council or private.

What is worrying is that now that the Government have a different policy with regard to council housing— for example, trying to sell more houses and the actual estates—these rights that the tenants were very pleased to have from the Government are being taken away from them because the estate or the group of properties they are living in are to be taken over by a private landlord. My noble friend is trying to say that these rights are rights which the tenants should be able to have whether the homes are in private ownership or in council ownership. I think that this is the important point which the Minister has to answer.

Lord Skelmersdale

The point I was trying to make is that rights under the Rent Act as opposed to rights under the housing Acts are very little different. When the noble Baroness on another point talks about housing being taken over by the private sector, she must remember that all this discussion that we have had both on Tuesday and today centres around the fact that it is the local authority themselves who want to pass it over to the private sector and that it is the tenants in that situation who have the right of veto to prevent it.

Lord Elystan-Morgan

I am sure that every Member of your Lordships' Committee would accept that the contribution made by the party opposite in relation to defining and protecting the rights of council-house tenants is an honourable one and a substantial one. I have no doubt that the schedule that was moved by Amendment No. 35 last Tuesday—and I am sorry that I was not present on that occasion, but I read the debate carefully—has that general motive in mind.

There are three points that I seek to make in relation to that schedule under the heading of the amendment that we are now considering. The first arises from what the noble Lord the Minister said a short time ago. This was to the effect that in any situation where the majority of tenants on an estate are desirous that a transaction should be allowed to proceed, it would be unconscionable for the Secretary of State to prevent it. Those were not the exact words used by the noble Lord the Minister, but I think that I have paraphrased them accurately.

If the noble Lord the Minister looks at paragraph 5 of Schedule 3A which was incorporated in this Bill last Tuesday, he will see these words in the first part of it: 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". Then there follow these words: 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". If I may say so, I respectfully disagree with the Minister and agree with the principle that is enshrined in that particular paragraph; for there must be a few circumstances where, despite the fact that a majority, a bare majority, of the tenants are in favour of such a disposal, it still would be proper for the Secretary of State not to agree. One obvious example would be if it appears that there has been heavy canvassing of the tenants and that they may have been misled as to the exact circumstances of the disposition, in which case I think it would be right for the Secretary of State to say that he must protect the interests of the estate as a whole.

That leads me to my second point. There is, in my opinion, no ideal answer to this situation. One can have a short and easy (on the face of it) decision based upon whether the majority is for or against a certain disposition. But it may be extremely unfair. The estate may be a large estate made up of a number of parts which are very different one from another. Taking the totality of those voting and assuming for the purposes of argument that everybody casts a vote or expresses an opinion in an articulate way, there may be a bare majority. But there may be one part of the estate—representing, let us say, one-third—the nature and conditions of which are entirely different from the rest. Would it be right in those circumstances to say that those people should be bound by the wishes of the others, whose conditions may be very different?

I suppose an alternative would be to say that there should be a public inquiry on each occasion. There again that does not guarantee that there will be a perfectly equitable decision. Even if all the available evidence is brought before the requisite inspector, he is not a perfect, platonic philosopher-king who will arrive at a completely equitable decision of necessity. It would seem that if the Secretary of State is prepared to consider an inquiry but nevertheless to say that there should never be a disposition if the majority are against it, it may well be that one would get as near to a safeguard of fair dealing as one could.

My last point is in relation to paragraph 6 of that schedule. I am sorry to have to go back to it, but in my submission it is something which very much dictates the situation in relation to the amendment that the Committee is now considering. The Committee dealt with this last Tuesday but, in my submission, it is of general import. The wording of paragraph 6 of Schedule 3A reads: 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". So, having on the one hand very deliberately created a system, which goes a long way—I accept that—in protecting the rights of tenants, on the other hand all that is immediately taken away. I am sure that what the Government had in mind was to see to it that it is not necessary to prove that the Secretary of State has dotted every "i" and crossed every "t" and that if it be that some unimportant formality had not been observed it would be utterly wrong for the whole of his decision to be invalidated.

On the other hand, the wording of paragraph 6 is so wide that even if the Secretary of State—and I am not suggesting that it is likely that he should do so—of any particular hue totally accidentally were to fail to apply his mind to the fundamental question of paragraph 5, that disposition would still be completely valid. It is for those reasons that, very respectfully, I suggest to the Committee that the amendment proposed by my noble friend is a very necessary one.

5.30 p.m.

Lord Dean of Beswick

Perhaps I may make the briefest of comments. The Minister made quite a lot of play about the fact that the tenants would be protected under the Rent Acts, as they remain. I think that is what he said. But is it not now the Government's policy eventually to phase out the Rent Acts? Would that mean that the total number involved would then not have historic protection and statutory rights?

Lord Skelmersdale

No; the noble Lord has got it wrong again. It has never been the Government's intention to phase out the Rent Acts—never, ever, ever.

Baroness David

May I ask one question in relation to the debate we had on Amendment No. 26 last Tuesday? The Minister said then, in col. 191: That is why Clause 4 itself has been included in the Bill at all, to ensure that one of the most important of tenants' rights, the right to buy, is preserved by statute when secure tenanted properties are transferred to a private landlord". That seems to me to admit that other rights which council tenants have are going to be lost when there is this disposal. What other rights are they keeping?

Lord Skelmersdale

I do not have the copy of Hansard in front of me. I referred to one of the rights. The only right that clause is concerned with is the right to buy, and to carry it on through. That way, it would be one of the rights, would it not?

Baroness David

But what would be the other rights the Minister thinks they would be keeping also?

Lord Skelmersdale

They have all sorts of things, do they not? For example, they have a right to a mortgage; they have a right to repair. We have been talking about a right for common part grants, and we have been talking about all sorts of rights over the past few days.

Lord Dean of Beswick

I certainly do not think that the undertakings the Minister has highlighted again, as he did on Tuesday, give to the tenants, if they are transferred to the private sector, anything like the protection that we would desire to see. However, there has been so much said today about the subject, including the legal interpretations, that I should like to look at what has been said and perhaps come back at a later stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Davidmoved Amendment No. 68:

After Clause 7, insert the following new clause:

("Disposal of land held for housing purposes: public inquiry.

In Section 32 of the Housing Act 1985 insert— (6) Where a disposal is to be subject to an existing tenancy or tenancies, before giving any consent 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 Baroness said: This in a way covers a slightly similar situation, but what we are proposing is a public inquiry as being the fairest way to deal with the situation that arises when there is a disposal of land held. The purpose of this amendment is to give the tenants the right to demand a public local inquiry if their council is proposing to hand over their homes to a private landlord or developer where they remain as tenants of the property following the transfer.

Why should the tenants have a right to demand a public local inquiry? They should have that right, if they are unhappy about such a proposal, as a safeguard against the disposal of their homes against their interests and against the interests of other householders wishing to rent local authority accommodation in the area.

Why would a public inquiry provide a safeguard for tenants? Let us consider the circumstances in which a council will be contemplating the disposal of tenants' homes to the private sector. As the Minister pointed out in his speech, at col. 201 last Tuesday, 7th October, the promoter of such a proposal will, in nine cases out of ten, be the council, and in the tenth case it will be the Secretary of State. It is very unlikely that the promoters of the scheme will be tenants whose homes will be directly affected. The council is likely to be considering handing over its tenants' homes to the private sector because of the extreme financial pressure it is under as a result of the cash limits imposed by central government on its housing investment programme.

The council itself may want to improve tenants' homes, according to tenants' wishes, for them to continue to rent, but the council may be prevented from borrowing the necessary finance and from using the necessary proportion of its available capital receipts to carry out such a scheme. A private developer or trust is, however, offering to carry out such improvements in return for ownership of the land and the properties, some of which it may wish to refurbish for sale or to let at market rents under assured tenancies. The developer, unlike the council, will not be hampered by government cash limits if it wants to borrow money to carry out such improvements. Indeed, substantial government grants may be available to the private sector for such a scheme: for example, urban development or urban regeneration grants.

Clearly, the interests of the private sector of the council and the tenants whose homes will be affected are not evenly balanced in these circumstances, so what protection will there be for those whose interests should be paramount—the tenants whose homes will be affected—if the council is considering disposal of their homes for improvement to the private sector? How will tenants be able to judge whether what the council is proposing is really in their interests? How will they be able to have a real say in the future of their homes if disposal is being proposed in such circumstances?

We are proposing that tenants should have a right to demand a public local inquiry concerning the council's proposals in such circumstances. A public local inquiry would provide tenants and their advisers with the right to receive copies of all the relevant information about the council plans, which might otherwise be kept back because the council say they are commercially confidential. It would enable tenants and their advisers to raise any objection or query they had about the council's proposals—for example, would the proposed improvements tackle structural defects in their estate?—and it would enable tenants to put forward any alternative proposals they might have for the future of their estate for independent consideration, alongside the council's own proposals.

Following such an inquiry, tenants would be in a much better position to judge whether the disposal of their homes was really in their interests and whether or not better alternatives existed for the improvement of their homes for rent. They would then be able to take an informed vote on the recommendations of the inquiry regarding the future of their homes.

Why does the Government's right of veto not provide such a safeguard for tenants? The Government may say that a public inquiry would be an unnecessarily expensive and elaborate procedure and that the right of veto for tenants provided under the new clauses (Amendment No. 26 and Schedule 33) which we approved last Tuesday will provide a much more effective safeguard of tenants' interests. But how real a safeguard would this be in practice?

Let us remember, first, that tenants will be reacting to a proposal which they themselves will not have initiated and which will already have been developed to a fairly advanced stage by their landlord. To assess the council's proposal fully and to consider alternative options will not be easy for tenants. They will require time and resources. Let us remember, secondly, that tenants will have very little time under the Government's proposal to react. Once the council's proposal is firmed up they may have only 28 days to express their views to the Secretary of State before a decision can be taken about the handing over of their homes to the private sector.

The council is likely to present two options to tenants. Either they can agree to the hand-over of their homes to the private sector as a means of securing improvements or they can choose to remain council tenants, with little likelihood of improvements being done within the foreseeable future owing to the spending restrictions placed on their council by the Government.

Tenants are likely to be made an offer which in fact they cannot refuse. In such circumstances, it is unlikely that a simple majority of them would express themselves firmly opposed to their council's proposal within the timescale envisaged by the Government. But this does not mean that the council's proposal to hand over their homes to the private sector would necessarily be in their best interests or, indeed, in the best interests of other people in housing need in the area. That is why we propose a right of public inquiry. It would help to slow down the process of disposal to ensure that a decision is not taken before all relevant points are taken seriously into consideration, which is likely to lead to the disposal taking place in a way which will later be regretted by tenants, by the council and the private sector.

That is what happened with the Stockbridge Village Trust. Many members of the Stockbridge Trust's board, besides tenants of Cantril Farm (which is the estate that was involved) have now publicly expressed regrets about the way the estate was transferred from Knowsley Council without adequate consideration of the likely implications.

Tom Baron, adviser to Secretary of State, Michael Heseltine, when he was in that position, who is also the chairman of the Stockbridge Village Trust, said recently: The whole thing was done for too quickly. I first looked at the scheme in August, came up to the estate in September and the trust was set up in March. As a result of the speed with which the transfer took place, the Trust failed to notice serious structural defects in the estate or to assess fully the financial implications of the capital programme it proposed".

Roger Tym and Partners, consultants appointed by the Department of the Environment to review the trust's work, recently observed: If you knew then what you know now, you probably would never have started".

The majority of tenants voted for their homes to be handed over by the council to the trust but they did this because they were promised substantial improvements to the estate by the trust—promises which have not been kept—and because the council closed off any discussion of alternative options among tenants. Tenants were warned by the council: "If you don't agree to our basic proposals, there will be no improvements whatsoever". Had the significant minority of the tenants who objected to the council's plans had a right to a public inquiry before the disposal of their homes, then many of the problems subsequently arising in Cantril Farm could have been identified in advance before it was too late.

There was an article in the Economist in March of this year about the Stockbridge affair which I think is quite interesting. The Economist is, after all, an independent paper. The article said: In 1983 Knowsley Council sold the estate (then called Cantril Farm, or Cannibal Farm to locals) to the Stockbridge Village Trust (whose participants included the Abbey National building society, Barclays Bank and Barratts, the builders). Now, almost three years later, auditors valued the estate below the £9½ million the Trust says it is worth. The trust chairman, Mr. Tom Baron, expects losses of between £250,000 and £500,000 this year and the Department of the Environment is running two inquiries into the trust's management and finances. It now appears that the estate has not really been privatised at all. Today, it is a hive of building workers and looks much smarter, but almost two-thirds of the £50m cost of renovating Stockbridge is coming out of the public purse. What went wrong? First the Trust could not raise from private institutions the finance required to buy the estate. After a little gentle arm-twisting from Mr. Heseltine, the Abbey National was persuaded to provide a £3m mortgage; Barclays parted with £2m. Finally, Knowsley, the sellers, had to provide the Trust with a £2.5 million mortgage. The second problem was that fewer people than expected tried to buy their homes. They had security of tenure anyway, and as tenants of an ordinary private Trust they are protected by law from 'unfair' rent increases. With unemployment in the estate at 40% among adults, and 90% among the young people, mortgages are hard to come by. Barratts have managed to sell 100 of the new homes they have built (though some critics maintain they have had guarantees to remove risk). Nevertheless, the government has had to pump £11.5m into Stockbridge's local housing association to build new homes for renting. The third blow to the dream came this autumn. Plans to renovate three multi-storey blocks ('The Denes') at the centre of the estate, and sell them as flats … crumbled. Each flat, it appeared, would cost £20,000 to do up and fetch just £10,000 on the open market. Abbey National and Barratts both pulled out, turning a private-sector face-lift into another drain on the public purse. The Trust will now apply for a grant to demolish The Denes which could cost up to £5m. The Trust has been told it must not enter into any significant contracts until a financial inquiry, currently under way, has been completed. Nor will the Trust get any more grant money for the time being. What does this say for such projects in the future? All those involved in the scheme point out it was the government's idea, not theirs, and admit it has not been a success. Financial institutions say they will steer well clear of such schemes in future—at least until the government abolishes rent control and makes it easier for local authorities to give guarantees to developers. Knowsley council is not blamed by the Trust; both, along with their private sector partners and the people of Stockbridge, see themselves as guinea pigs in an experiment which has not really proved anything".

I hope that with what I have said and that quotation regarding Stockbridge, your Lordships will see that an independent review which could go into everything and make quite sure that tenants have full information at the right time is the only way to make quite certain that everything is done fairly and justly. I beg to move.

5.45 p.m.

Lord Skelmersdale

I was slightly confused at the beginning of the noble Baroness's explanation because she obviously had not taken on board something which her noble friend Lord Elystan-Morgan said just now. As I understood it, and I sure he will immediately correct me if I am wrong, he said that there was no ideal solution in this matter and he gave some rather convincing arguments against having a public inquiry.

In any event, I had hoped that the noble Baroness would not have felt it necessary to move this amendment in view of the group of Government amendments, beginning with Amendment No. 26 on tenant consultation which the Committee has already agreed should be made. You will recall that these give tenants the right to be consulted about proposals to sell tenancy council houses to a private landlord. I must say again that they also give them, in effect, a right of veto where the majority are opposed to the sale. In the circumstances, I cannot see any useful purpose in building in additional hurdles. The amendments already agreed must surely provide adequate protection for tenants affected by sales schemes.

The noble Baroness hung a lot on the problems, which I readily admit existed on the events surrounding the formation of the Stockbridge Village Trust. However, I am advised that the problems of Stockbridge could not happen under this Bill. The Government's new consultation procedures provide for the tenants to be given full details. When satisfied that they have consulted all the tenants, the local authority must supply the Secretary of State with copies of information it has given to the tenants; in other words, the basis on which the consultation was made. If inadequate information has been given to the tenants, the Secretary of State will be able to require the council to carry out further and more detailed consultations.

Going back to the purpose of this amendment, which is a public inquiry, it would in any case be inappropriate to make the holding of such an inquiry mandatory in each and every case. If tenants are happy with the proposal, they will not want one. Also, the noble Baroness forgets that there are occasions when the sale would result simply in a tenant transferring from one public sector landlord to another. To insist on a single tenant or small group of tenants going through the public inquiry procedure when they already have the right of veto, would, I submit, be rather absurd. I must therefore ask the noble Baroness whether she would, on reflection, wish to withdraw the amendment, especially as her noble friend Lord Dean indicated during the Committee stage on Tuesday (at col. 227 of Hansard) his wish to see what view the local authorities had about the holding of a public inquiry in cases to which the new consultation provisions will apply. If the noble Baroness is not prepared to withdraw this amendment, I must ask the Committee to reject it.

Lord Pitt of Hampstead

I do not know what my noble friend will do about her amendment, but I am sorry that the Government are rejecting a public inquiry. We have just had an argument about what will happen to the minority when the tenants are asked to vote on whether they accept a scheme. In a public inquiry they will at least have a say and somebody will look at the case. We will have gone some way towards meeting people's problems. So I am sorry that the Government are rejecting the amendment.

From what we have heard, it would have been wiser to have a public inquiry at Stockbridge and to see some of the accompanying problems before plunging into the scheme. Therefore, while I am in sympathy with the Minister when he says that we will not want a public inquiry for everyone, I believe that provision for a public inquiry in this context is a very good thing and I hope that the Government will think again.

Lord Graham of Edmonton

I hope very much that the Minister does not assume that a public inquiry has only one purpose. Public inquiries are designed for the situation when the Minister does not have all the evidence to make up a case. The inspector will be able to amass the evidence and to make a recommendation one way or the other. The Minister is then invited to accept or reject the inspector's findings. I am not so much concerned with the decision as with the principle of accountability and scrutiny.

We have heard about the majority and the minority. There may be a minority who feel that they do not wish to change their landlord. I am not asking about their rights and so on, but it is an appalling situation if their landlordship can not only be bought by somebody else but can, one assumes, then be sold by that person. A public inquiry would serve the very powerful purpose of forcing those who feel that something is right and proper—that is, the council—to explain. I am all for local councillors not having the opportunity of hiding behind the anonymity of a committee decision, the minutes, a letter from the town clerk or a letter from the housing department.

One of the best things we have in our democracy is the fact that the chairman and members of a housing committee, who are the people—and all power to their elbow—who make the decisions, can be dragged into the public domain at a public inquiry and, at least, have to justify their arguments. Most councillors whom I know, without regard to political allegiance, are not only more than willing to defend their case but are more than capable of doing so, and in their inarticulate way people will be able to ask questions which to them are very important. I think that most councillors would welcome that.

What is this amendment seeking to do? It is seeking to make provision in the event of people feeling that they want to see their case better ventilated, and I think that a lot of councils would welcome that opportunity. The Committee will recall that many council estates were created as a result of a public inquiry. The land has been purchased only as a result of a public inquiry. I know the Minister may say that land is not being disposed of, but we are talking about making enormous changes in the social fabric of an estate. On estates in Enfield and Edmonton, where I live, there are up to 2,000 people and major social changes could be made.

A public inquiry would not be adopted lightly and would not find favour very often. But the opportunity which this new clause gives will do a great deal of good. More important, it will give a lot of people the assurance that the whole community will be involved and not just the vested interests of the people concerned; that is, the councillors and the council tenants. There will be many areas inside a borough where people will have views about whether council estates should be broken up. They are all ratepayers and taxpayers and they are entitled to have their say. This is a very sensible and reasonable amendment.

Lord Stallard

I too, want to support this public inquiry proposal. Indeed, I mentioned this on a previous amendment last Tuesday and my noble friend Lord Graham has touched on some of the points which I then made and which are worth repeating, as he has just done. I said then that the Government's consultative procedure, and this constant reference to the veto, has many flaws and leaves many questions unanswered. I did not get satisfactory answers to the questions I posed on Tuesday, and I certainly have not heard anything today to change my mind about the inadequacy of the Government's consultative procedures.

As I said, at that stage of the consultation tenants will be consulted about only one option—the council's proposals. But there are many options. I mentioned alternative forms of management and so on which will not be included in the consultative process, because the Government's amendments clearly state that council tenants will be consulted about the council's proposals, and obviously about nothing else. There are other options which ought to be put to tenants and they ought to be able to put their own options in order to have a proper consultative process.

On Tuesday, the Minister pushed to one side a comparison made by one noble Lord with the CPO procedure for owner-occupiers or for other kinds of property or bits of land required for development or resale. But there are similarities. When we strip away all the verbiage and all the dogma from these proposals we are doing the same thing. We are dealing with people's homes. The end result is that somebody will be in danger of losing his home as a result of a proposal to take it away or to transfer it to someone else. So if, in one case, you are entitled to an inquiry under the compulsory purchase procedures, why should a council tenant not have the same kind of inquiry when his home is being taken away from him? It seems natural justice that council tenants should be given the same right of airing their views at a public inquiry.

I do not take the view—and it comes across time and time again from Ministers in both Houses—that council tenants can be easily pushed around, almost as though they are second-class citizens or lumps of merchandise. They are not considered the same as the rest of us who are owner-occupiers or business people. They are something different, something less than that, and therefore they have lesser rights. I do not think we ought to accept that, and the public inquiry might well put some justice back into their situation.

As I understand it, the tenants' charter, which we all welcomed when it was introduced by the present Administration in 1980, was for all tenants. It did not sort out the different tenants. It did not say that if 51 per cent. of tenants did not like something, it was just back luck for the other 49 per cent. who were in the minority. That charter was for them all.

If one, two, three or four people feel strongly enough about losing their homes they are entitled to object and they are entitled to have their objections heard. They are not to be herded into a group to be told, "All the others have agreed, so it is just tough luck, chum; your flat can go as well. We know you have been here all your life; we know that you waited for years to get the place in the first instance; we know you are hoping that one of your children might inherit it later on; but that is too bad. All the others have decided that you do not have the right to defend it. After all, some of the tenants have had a veto and they have exercised it. If you did not, that is your bad luck". This is what the noble Lord the Minister has said umpteen times during the course of the debate on these amendments.

6 p.m.

Lord Skelmersdale

Is the noble Lord seriously suggesting that a minority should be able to veto the wishes of a majority? If so, as I said in my original speech, or rather in response to one of the noble Lords on the Front Bench opposite, that would turn our electoral system upside down.

Lord Stallard

I am saying, yes, a minority—even of one. How many times have we seen one tenant, one resident or one occupier holding up a motorway, holding up a bridge and holding up all kinds of things? They had a right to do so. We defended their right. We might not have agreed, but they had the right to be heard and they had the right to have an inquiry; and after the inquiry the result was taken. We have seen it many times. What is the difference between a council tenant's home—because that is all he has as well—and some of the others? Why should not he or a few of them have the same kind of rights? We cannot just dismiss them because they are council tenants, who will turn the whole world upside down if they object. But others can object, and they will be defended by the most expensive barristers in the land who will take their case; and inquiries go on in some cases for months and for years.

I am not saying that I agree with all of that, but I am saying that they should have the right to be heard. The only way they can be heard, in my view, is to have a public inquiry. I hope that the Minister will change his mind and accept the logic of our amendment.

Lord Skelmersdale

I really must protest to the noble Lord, Lord Stallard. Only under an inquiry, he said, would the tenant have a right to be heard. Under the Bill, the tenants must be consulted—all the tenants must be consulted — by the local authority. In the case of a public inquiry, as we all know, only those people who want to put in objections to the inquiry actually do so. Under this Bill, there is a strengthened right over any public inquiry anywhere in the land. All the tenants must be consulted. Not only must all the tenants be consulted but a majority must agree. I really cannot see how noble Lords opposite can get away from those simple facts in the Bill.

Lord Stallard

I must take up this point as I have raised it two or three times. The Minister has said again exactly what he has said on a number of occasions. When I asked him what the machinery for that consultation will be and how he will be sure that every council tenant has been consulted, as would happen in the case of other inquiries, no answer was forthcoming. It seems that a notice will be put out or there will be something in the local press. How will it be done? How can we be sure that all the tenants will be consulted? There is no reply. I have yet to get a reply to that very important question from tenants. If some do not hear about it or if they do not read the right kind of newspaper, then again, bad luck; that is the end of the consultation.

Lord Skelmersdale

I said over and over again on Tuesday that the tenants must be informed. The noble Lord, Lord Stallard, asked how the tenant would make his view known. It has to be in writing. That is the first answer to his question.

Lord Stallard

He has to be able to write?

Lord Skelmersdale

Yes. He or somebody else on his behalf has to be able to write. He has to be able to make his mark. He has to be able to affirm or whatever is necessary in his particular case.

The noble Lord also asked how the tenant is to know in the first place. As I made clear earlier today, the Secretary of State has to have not only the views of the tenants but the information that was circulated to the tenants on which the tenants made up their minds. In the event that the Secretary of State finds that information inadequate, he will insist on new information being put to the tenants. I am not trying to obscure anything in this; I really do believe that it is a valid method of consulting the tenants to discover what the tenants themselves think is in their own interests.

Baroness Fisher of Rednal

The difficulty here is about what we call consultation. The consultation procedure is normally the giving of information. Therefore, consultation has to take place before any plans are on the table. In other words, the tenants themselves should be informed that it is envisaged that a block of flats or an area is going to change ownership from the local authority. The consultation procedure normally is comprised of somebody coming along with a big plan and saying, "We have a building society and a private trust and this is what we are going to do". The tenants are then faced with that or nothing. Obviously, if it is that or nothing (and they are thinking about their home and the roof above them) they will take that. The opportunities to discuss other ways in which the local authority could be helped to use the properties in a different way are not a part of the procedure. We have to ask: what is consultation? It should not be just a passing of information to a group of people who say yes or no to whether or not they agree to it.

Lord Skelmersdale

I agree with the noble Baroness. It should not be just throwing literature through the letter-box. It will not be just throwing literature through the letter-box, because the tenants, as I have just explained to her noble friend Lord Stallard, have to give a positive answer. The Secretary of State will receive both the paper that goes out and the signatures or the written evidence which comes in of the tenants' approval. The Secretary of State can then decide whether or not the information that was given to the tenants was adequate. If he decides that it was not adequate, the process has to start again. I should have thought that this was real consultation.

I am absolutely convinced that somewhere on a council estate there will be a tenant in any and every case who, if he is not satisfied with the information provided, will go to the council and say, "What's all this about?" The noble Baroness, who has much more experience of estates than I do, must know of occasions in the past when this has happened because an individual tenant affected has decided that that was necessary. There is always a certain amount of friendship at the very least, even if there is not a formal tenants' association on a particular estate.

What really concerned me in what the noble Baroness said was her suggestion that the local authority will put out a piece of paper saying, "This is our proposal, or nothing". The local authority will do nothing of the kind. The only alternatives are the proposal on which the local authority wants to consult, or maintaining the status quo. It is not "That or nothing". It is that or remaining in exactly the same position as you are now. I do not see, in that case, that the noble Baroness should have a particular worry.

Baroness Fisher of Rednal

So the first consultation will be that the Secretary of State will agree to what one would call a bald statement: "Do you wish your properties to be taken out of council ownership and put into private ownership? Answer yes or no." Is that what the noble Lord is trying to say?

Lord Skelmersdale

I am sorry, my attention was slightly distracted. Will the noble Baroness be good enough to repeat her question and I will answer, yes or no.

Baroness Fisher of Rednal

Do I understand from what the noble Lord just said that the first consultation, if we can call it a consultation, will be that the local authority says to the group of tenants, "We intend in the future to consider the selling-off of your properties and the land thereon to someone else. Do you wish to retain council ownership of the area or are you willing to be passed over to private developers? Answer yes or no." Is that what the Minister means by the first consultation?

Lord Skelmersdale

No, I have obviously totally confused the Committee; or at least those Members on the Opposition side. What will happen is that the local authority will consult on a specific scheme which it decides is right for the tenants, the property, the land, the buildings, and everything else. It will consult on a specific proposal and on that specific proposal the tenants have a right of veto. It is as simple as that.

Lord Sefton of Garston

I just do not know where this Chamber is going, for the simple reason that the Minister adamantly refuses to explain what he means by consultation.

One of the greatest threats to democracy is when 51 per cent. of the people concerned in a proposal decide what should happen to the 49 per cent. without any regard at all to the personal circumstances of the 49 per cent. That is imposition by majority rule of something that could be extremely damaging to the 49 per cent. and to which no sensible person would agree. It is dictatorship, as has been said by a noble Lord. It is dictatorship by the majority.

The difference between the consultation mentioned by the Minister and a public inquiry is that in a public inquiry the facts are brought out; expressions of opinion are brought out both for and against certain points of view, and the Government appoint a responsible person to decide, on the basis of the evidence, what is the best course taking everything into consideration. There is the world of difference between that and a Minister, as sympathetic as he might wish to be, writing to a tenant and asking, "What do you think about this proposal?". The tenant will reply, looking from his own personal point of view, his own economic point of view, and completely ignoring the social point of view. The Minister will then make up his mind. There will be no opportunity to have what we are now having in this Committee—the opportunity of debate.

This is the whole process of democracy; that we should meet in this Chamber and debate issues. There should be the exchange of points of view. In a public inquiry that would be possible. With the form of consultation which I gather the Minister is suggesting—and I can hardly believe that it is true but that is my understanding from what the Minister has repeatedly said—that is not possible. I appeal to the Committee to remember that we are not discussing the laying down of a road. We are not discussing the creation of an office block. We are perhaps discussing 49 per cent. of people on a housing estate; and not just the question of housing but the whole change that may be made to their livelihood, their living and the way they conduct their lives. That is an important issue.

I suggest that the Committee will be betraying democracy if it decides that that kind of issue should be settled by letter or by some form of consultation on which the Government are not making clear how it should be done. We should at least accord to the people on such a housing estate the same rights that every Member of this Chamber would demand if they were debating issues which are not even as important as the question of who owns one's house.

6.15 p.m.

Lord Skelmersdale

In replying to the noble Lord, Lord Sefton, I must make this my final speech on this subject. The noble Lord said that I have no regard for the position of the minority. I have said over and over again that, by definition, if one consults all the tenants one must have consulted the minority as well as the majority. That must be true.

I do not know whether the noble Lord was in his place when I said earlier that a local authority which proposes to sell tenanted dwellings to a private sector landlord will be required by law to consult the tenants affected and that this will be proper consultation. The local authority will be required to give the tenants details of the proposal in writing. This will include the name of the likely purchaser and the likely consequences of the sale for the tenant—for example, in respect of the rent he will pay. Furthermore, the local authority will be required to notify the tenants of the preservation of their right to buy under Clause 4 and their right to object to the sale; informing them, in doing so, that the sale will not be able to proceed if the majority of the tenants indicate to the Secretary of State that they are opposed to it. That is real, proper, legally enforceable consultation. We cannot do any more.

Lord Sefton of Garston

I heard the Minister say that half-a-dozen times, and the net effect of it is this. If one takes 100 people who are tenants on a housing estate and ultimately 51 per cent. agree to private ownership and 49 per cent. disagree, what does that mean? It means that two people on that housing estate have decided the fate of those houses—that is, of course, if the Minister decides to go with the majority. I am suggesting that that is absolutely wrong when discussing such a vital matter as a person's house and home.

Lord Dean of Beswick

The Minister is trying a very hard sell here, but he is not succeeding with anyone on this side of the Committee.

I make one brief point. I do not think the Minister would have been involved, but a few years ago I was engaged in the large scale purchase of houses in the private sector. It was slum clearance which is usually done in the big cities in packages of 400 to 500 at a time—that was about the figure. The local authority had the right to take over old slums, if necessary against the tenants' wishes, and to demolish them. That always resulted in a public inquiry which Has of course overseen by an inspector from the Department of the Environment. There is very little slum clearance taking place today. Therefore, I do not believe that there is any shortage of inspectors who could be quite readily organised to carry out this particular function.

More than one speaker on the Opposition Benches has referred to the fact that we are dealing with the most important facet of some people's lives—their homes. They may have been born in them. If they have been lucky enough to have been born in council houses and spent all their lives in them they will have done a lot better than other people. They may well die in the same home. As I have said, many of the people who are worried about the situation are middle-aged, some of whom may have fought during the war, and now for the first time in their lives feel threatened.

One of my noble friends related the example of the purchase of property for road improvement or road widening. I often drive between Manchester and Leeds along the M.62 and sometimes it is not a very pleasant experience. When one reaches that part of the M.62 not far from where my noble friend Lord Rhodes lives—a very renowned place—the six lanes of the motorway suddenly split. Right in the centre is one small farmhouse. I suppose that situation arose because the farmer objected to having the motorway going right through his house or having the house demolished when the motorway was built. It must have cost a substantial sum of money to carry out that exercise.

I say to the Minister that if he does not consent to the request of this side of the Chamber and the wishes of the tenants and allow a public inquiry to take place, then once again this Government will be accused of treating council house tenants as second-class citizens.

Baroness David

We have had quite a long debate on this amendment and it is a matter of very great importance. Before I wind up the discussion I want to tell the Committee what I have heard from a number of tenants' associations and perhaps I may read out a letter from the Tower Hamlets Federation of Tenants. I may say that it was written after the new clauses had been published. The letter says: We wish to point out that along with many other tenants' organisations and groups we are not at all happy with the Government's new clauses on consultation with tenants as they provide no adequate rights for tenants to receive relevant information; no right to have their objections and alternative proposals seriously considered, if their council wishes to hand over their homes to the private sector against their wishes. The experience of tenants in Tower Hamlets on the Waterlow and Teviot estates clearly shows that tenants have no adequate right enshrined in law to be informed and consulted under such circumstances … [They] were never even informed, let alone consulted, about the council's plans for their estate and despite tenants taking court action, campaigning and actively opposing the council's plans, the estate was handed over to Barratts. Tenants on the Teviot estate have been aware for many, many months that the council is discussing plans with the Department of the Environment's Urban Housing Renewal Unit to develop a trust to take over the estate. They have not been informed or consulted about these discussions. We urge you in the light of our tenants' experience to support … a public local inquiry to be held before the Government could agree to the disposal of council tenants' homes or the delegation of their management to the private sector for rent or sale. Such an inquiry would provide tenants' organisations and groups and their advisers with the following: rights of access to all relevant information; resources to argue their case; the opportunity to put their objections in detail; the opportunity to have their alternative proposals for the future of their homes seriously considered; an independent assessment of the council's plans and of their own alternative proposals for the future of their homes. Such provision for a public local inquiry with a tenant's right to veto following such an inquiry would provide an effective safeguard against the handover of tenants' homes against their wishes.". Then there are the Walterton and Elgin estates in Westminster. A year ago the tenants heard that it was proposed to demolish 900 units of Victorian terraces and sell the land to a private developer. The tenants had the greatest difficulty in obtaining the information that they needed from the council. Finally they set up their own committee, and had to spend quite a lot of money doing it. There were 250 residents involved and they asked the housing committee whether, if the council was not prepared to improve the property itself, they could produce their own plans. They created a co-ordinating committee and only by spending a lot of money and time—one man apparently spent his whole time on it—did they eventually manage to force the council to change their decision and the original proposals for selling were dropped. The council has now agreed to spend £7.2 million on the Walterton and £2 million on the Elgin estates. However, they had great difficulty and it took all that pressure to get the council to change its mind.

It is so hard to get information. The tenants were told to start with that they could not have the information because it was given on a basis of confidentiality. The only proper safeguard is to have a public inquiry.

The Minister said that we had accepted Amendments Nos. 26 and 33 on Tuesday. Naturally, what they did was to make the situation marginally better than it was before, but we do not think that that is good enough. If homes have to be acquired from the private sector for the purpose of road development or possibly for other good reasons, compulsory purchase orders have to be made. Private tenants have that protection. We see no reason why the same sort of inquiry should not be allowed for public sector council tenants. I wish to press this amendment.

6.24 p.m.

On Question, Whether the said amendment (No. 68) shall be agreed to?

Their Lordships divided: Contents, 62; Not-Contents, 88.

DIVISION NO. 3
CONTENTS
Airedale, L.	Llewelyn-Davies of Hastoe, B.
Amherst, E.	Lovell-Davis, L.
Ardwick, L.	McIntosh of Haringey, L.
Attlee, E.	McNair, L.
Bottomley, L.	Mayhew, L.
Brockway, L.	Meston, L.
Carmichael of Kelvingrove, L.	Mishcon, L.
Cledwyn of Penrhos, L.	Morton of Shuna, L.
David, B.	Mulley, L.
Davies, L.	Nicol, B.
Dean of Beswick, L.	Oram, L.
Donoughue, L.	Pitt of Hampstead, L.
Elwyn-Jones, L.	Ponsonby of Shulbrede, L.
Elystan-Morgan, L.	[Teller.]
Ennals, L.	Prys-Davies, L.
Evans of Claughton, L.	Rhodes, L.
Ezra, L.	Rochester, L.
Fisher of Rednal, B.	Ross of Marnock, L.
Fitt, L.	Sefton of Garston, L.
Gallacher, L.	Shackleton, L.
Galpern, L.	Stallard, L.
Graham of Edmonton, L.	Stewart of Fulham, L.
[Teller.]	Stoddart of Swindon, L.
Grey, E.	Underhill, L.
Houghton of Sowerby, L.	Wallace of Coslany, L.
Howie of Troon, L.	Whaddon, L.
Hughes, L.	White, B.
Jacques, L.	Williams of Elvel, L.
Jeger, B.	Wilson of Rievaulx, L.
John-Mackie, L.	Winchilsea and Nottingham,
Kirkhill, L.	E.
Kissin, L.	Ypres, E.
Listowel, E.

NOT-CONTENTS
Alexander of Tunis, E.	Keyes, L.
Allenby of Megiddo, V.	Kinnaird, L.
Arran, E.	Knollys, V.
Beaverbrook, L.	Lane-Fox, B.
Belhaven and Stenton, L.	Lawrence, L.
Beloff, L.	Layton, L.
Belstead, L.	Lindsey and Abingdon, E.
Bessborough, E.	Long, V.
Brabazon of Tara, L.	Lucas of Chilworth, L.
Brookes, L.	Macleod of Brove, B.
Brougham and Vaux, L.	Malmesbury, E.
Broxbourne, L.	Margadale, L.
Buxton of Alsa, L.	Maude of Stratford-upon-
Caithness, E.	Avon, L.
Cameron of Lochbroom, L.	Merrivale, L.
Campbell of Croy, L.	Mersey, V.
Carnegy of Lour, B.	Milverton, L.
Coleraine, L.	Monk Bretton, L.
Constantine of Stanmore, L.	Monson, L.
Cottesloe, L.	Morris, L.
Cox, B.	Mottistone, L.
Craigavon, V.	Mountevans, L.
Craigmyle, L.	Munster, E.
Davidson, V. [Teller.]	Napier and Ettrick, L.
Denham, L. [Teller.]	Newall, L.
Dilhorne, V.	Norrie, L.
Eden of Winton, L.	Northesk, E.
Elliot of Harwood, B.	Nugent of Guildford, L.
Elton, L.	Orkney, E.
Ferrier, L.	Pender, L.
Fraser of Kilmorack, L.	Plummer of St Marylebone,
Glenarthur, L.	L.
Gormanston, V.	Portland, D.
Greenway, L.	Reay, L.
Hailsham of Saint	Rochdale, V.
Marylebone, L.	Rodney, L.
Hesketh, L.	Russell of Liverpool, L.
Hives, L.	Salisbury, M.
Hooper, B.	Sandford, L.
Hylton-Foster, B.	Skelmersdale, L.

Strathclyde, L.	Vickers, B.
Swinfen, L.	Vivian, L.
Terrington, L.	Ward of Witley, V.
Thorneycroft, L.	Whitelaw, V.
Trefgarne, L.	Wise, L.
Trumpington, B.

On Question, amendments agreed to.

6.32 p.m.

Baroness Davidmoved Amendment No. 69:

After Clause 7, insert the following new clause:

("Definition of Homelessness. Housing Act 1985.

.—(1) The Housing Act 1985 shall be amended in accordance with the following provisions.

(2) In section 58 (definition of homelessness) after subsection (2) there shall be inserted the following subsections— (2A) A person shall not be treated as having accommodation unless it is accommodation which it would be reasonable for him to continue to occupy. (2B) Regard may be had, in determining whether it would be reasonable for a person to continue to occupy accommodation, to the general circumstances prevailing in relation to housing in the district of the local housing authority to whom he has applied for accommodation or for assistance in obtaining accommodation.

(3) For section 69(1) (provisions supplementary to ss. 63, 65 and 68) there shall be substituted the following subsection— (1) A local housing authority may perform any duty under section 65 or 68 (duties to persons found to be homeless) to secure that accommodation becomes available for the occupation of a person—

1. (a) by making available suitable accommodation held by them under Part II (provision of housing) or any enactment, or
2. (b) by securing that he obtains suitable accommodation from some other person, or
3. (c) by giving him such advice and assistance as will secure that he obtains suitable accommodation from some other person,

and in determining whether accommodation is suitable they shall have regard to Part IX (slum clearance), X (overcrowding) and XI (houses in multiple occupation) of this Act.")

The noble Baroness said: This is a very important amendment about housing the homeless. Its aim is to restore the situation for housing the homeless to what it was before the judgment given in February in the case of R. v. London Borough of Hillingdon ex parte Puhlhofer. "Accommodation" is a key concept of our homeless legislation. The law defines someone as homeless if they do not have accommodation; and if someone is homeless and also fulfils certain other conditions, a local authority is under a duty to secure accommodation for them. The interpretation of "accommodation" is therefore of vital importance for the rights of homeless people and the practical operation of our homelessness laws.

The legislation says nothing about the standards or appropriateness of accommodation. The code of guidance issued by the Secretary of State to guide local authorities in their interpretation of the law makes it clear that the accommodation to be secured for homeless people should be permanent housing of a decent standard. Until the Puhlhofer judgment, a succession of legal cases favoured reading "reasonable" or "appropriate" with "accommodation" in both the initial definition of homelessness and in the definition of the local authority's duty to the homeless.

This general understanding of how our homelessness legislation should be operated has been completely overturned by the Puhlhofer judgment. There it was ruled that neither in the definition of homelessness nor in the description of the local authority's duty to the homeless was "accommodation" to be qualified. The legislation did not include the words "reasonable" or "appropriate"; therefore they were not to be read into it. Accommodation could be statutorily overcrowded or unfit for human habitation, but it did not thereby cease to be accommodation. "There are no rules", said Lord Brightman, in giving judgment.

What have been the effects of the Puhlhofer judgment? The Puhlhofer ruling has two main effects. One is that people could be condemned to live in intolerable conditions without any right to assistance. The existence of overcrowding or poor conditions cannot automatically lead to a judgment of homelessness. Local authorities already have various powers and duties to deal with these problems, and simply to suggest that someone was homeless if they were living in overcrowded or insanitary conditions would lead to legal and administrative complications.

But before the Puhlhofer ruling, case law had developed which suggested that in certain situations the accommodation in which someone was currently living could be so intolerable that they should be regarded as homeless. The standards set were very low, but nonetheless there were standards. The Puhlhofer judgment, however, explicitly rules out consideration of conditions being decided if someone is homeless. The sole question to be asked is whether the accommodation is capable of accommodating the household. Is there enough space? The Puhlhofer judgment rules out consideration of conditions; as Lord Brightman said, there are no rules.

However, the idea that accommodation might be so intolerable as to render someone homeless is already contained indirectly in the legislation. Section 60(1) of the Housing Act 1985, which defines intentional homelessness, says that someone is intentionally homeless if, among other things, they have left accommodation which it was reasonable for them to continue to occupy. The code of guidance says that in general local authorities should not treat as intentionally homeless those who have been driven to leave their accommodation because conditions had degenerated to a point where they could not, in all circumstances, reasonably be expected to remain, perhaps because of overcrowding, lack of basic amenities or severe emotional stress. If someone were to leave such accommodation, the local authority might judge that it was not reasonable for them to continue to live there and they would qualify for rehousing under the legislation.

If the same person applied for help while still in the accommodation, however, the Puhlhofer judgment rules that they are not homeless, because the question of whether it is reasonable for them to stay in the accommodation cannot be considered.

Secondly, the judgment raises problems about the accommodation offered to homeless people by local authorities. It was the intention of Parliament, as confirmed by the Secretary of State's code of guidance, that homeless people should gain access to permanent housing of a decent standard. Paragraph 4.4 of the codes says: Permanent housing should be secured as soon as possible".

The Puhlhofer judgment, however, seems to open the door to the use of very low quality accommodation for the discharge of the local authority's duty to the homeless. Not only does the ruling emphasise that the statute does not require local authorities to secure decent, reasonable or suitable accommodation for the homeless; it goes on to say that the legislation is an Act to assist persons who are homeless, not an Act to provide them with homes.

What is the Government's attitude? According to Robert Carnwarth, QC, an expert on the homelessness legislation, it is now impossible to derive from the Act or the decided cases clear guidance as to what constitutes homelessness. At a meeting with representatives of Shelter in March this year, civil servants of the Department of the Environment agreed with this judgment. But the matter was, they said, one for political judgment of Ministers.

The Government have since made it clear that they are opposed to proposals to amend the legislation to deal with the effects of the Puhlhofer judgment. Their reason, according to the Scottish Office Minister, Michael Ancram, speaking in another place on 2nd July, is that the judgment of the Law Lords accurately reflects the effect of the Act and what they understand to have been the intention of Parliament. The Government have thus effectively decided that they approve of the changes made by the Puhlhofer judgment and therefore have no wish to see this overturned.

In support of their position, Ministers have argued, first, that homelessness and the treatment of the homeless is a matter of local authority discretion; secondly, that no action could be considered unless it was shown that local authorities were adopting a, very different approach to the discharge of their duties". That was in the letter from Sir George Young to David Knox, MP; and, thirdly, that they will in any case be monitoring the situation through their quarterly homelessness statistics.

We would argue that our homelessness legislation is not about local authority discretion but about the rights of homeless people. The Housing (Homeless Persons) Act, now Part III of the Housing Act 1985, was introduced because local authority discretion to help the homeless was inadequate. In too many cases, the homeless received no help. Are the Government saying that they do not believe that homeless people should have a legal right to help or that they would like to see such rights limited? Perhaps the Minister will answer that.

Ministers have asked for examples of the effects of the Puhlhofer judgment. They have already had examples from Shelter, but how much evidence do the Government want? Do they want six, 60 or 600 cases? A request for evidence always sounds reasonable, but it also allows Ministers to continue dismissing the problem on the grounds of insufficient evidence. I hope that the Minister can give us some guidance on that when he replies.

A request for evidence also misses an important point. The question is one of legal rights. The law should not admit of degree when it comes to rights. If one person is wrongfully deprived of his rights, that is bad enough. Ministers did not claim, some years ago when there were complaints about councils' responses to the right to buy, that it did not matter if a few tenants could not effectively exercise that right. The Government's response then was that a right Parliament had granted should be a right for everyone.

Similarly, when we come to the rights of homeless people, we should not accept a situation where even a few people are deprived of their rights. It may be that the majority of local authorities choose to ignore the Puhlhofer judgment when carrying out their duties to the homeless, but even if the vast majority of councils did so choose that would not prove that clarification of the law was unnecessary.

The new clause has been drafted with the help of Robert Carnwarth, QC, to remedy the two main problems caused by the Puhlhofer judgment. Subsection (2) aims to re-establish the position that existed in case law before the Puhlhofer ruling: that there are situations when someone's accommodation may be so intolerable as to render him homeless. The Government have accepted that that should be the position. In a letter to the director of Shelter (Scotland), the Scottish Office said: in the last resort it is for the individual local authority to decide at what point someone's housing becomes so intolerable that it would be right to regard the homelessness provisions as applying".

However, since the Puhlhofer judgment there have been no criteria upon which a local authority could base its decision. The Puhlhofer judgment overturned all existing case law on that issue and ruled that conditions were no longer a consideration. Shelter has already made it clear that it accepts that homelessness legislation should not become legally or administratively tangled with the law concerning overcrowding or insanitary conditions. The subsection therefore introduces a test of reasonableness for the accommodation rather than a precise statement of standards: for example, overcrowding or unfitness standards.

The word "reasonable" has been used rather than "suitable" or "appropriate" because the idea of accommodation being such that it is reasonable to continue to occupy it already exists in the legislation. Section 60 contains the definition of "intentional homelessness", to which I have already referred. In addition, the word "reasonable" is qualified by allowing the local authority to have regard to the housing conditions of its area. That qualification is also used in Section 60. Its purpose is to make clear that the applicant's circumstances have to be unusually bad for him to qualify as homeless. The test is thus a strict one, as indeed were the tests in case law before the Puhlhofer judgment.

It is difficult to see what technical objections might be made to the subsection, as its wording is derived from other parts of the Act. The test that it introduces is stringent and thus close to the case law position before the ruling. It has the additional merit of making consistent the tests imposed by Sections 58 and 60 of the Housing Act 1985 as to whether someone is homeless if it is not reasonable for them to continue to occupy their current accommodation.

Subsection (3) aims to clarify a local authority's duty to homeless people. The Puhlhofer judgment leaves unclear whether standards apply to accommodation secured for homeless people. Local authorities must have regard to the code of guidance on that matter. The Puhlhofer judgment suggested that overcrowding and unfitness were two matters which local authorities were not obliged to consider. Subsection (3) does two things. The first is to make clear that the accommodation provided must be suitable. Secondly, in determining whether accommodation is suitable, local authorities must have regard to their statutory duties concerning overcrowded and unfit accommodation. That is a test which the Puhlhofer judgment waived. Those legal duties are contained in Parts IX, X and XI of the Housing Act 1985.

It is perhaps worth noting that at the meeting with Department of the Environment officials, Shelter was told that there was no technical objection to the introduction of statutory standards in the rehousing duty. The amendment does not go that far, but instead puts in law a duty to have regard to other legal responsibilities when providing accommodation for homeless people—physical conditions (unfitness), overcrowding and the provision of amenities.

The amendment aims to make explicit in law the understanding of our homlessness legislation as it existed until the Puhlhofer judgment. It has been carefully drafted to restore that position. It does not extend the legislation. This is an important matter. I hope that it will have the interest and support of the Committee. I beg to move.

6.45 p.m.

Lord Broxbourne

I wonder whether I may ask the noble Baroness a question arising from her interesting exposition of the proposed new clause. She has identified the provenance in the parent Act of 1985 of some of the expressions used in Mr. Carnwarth's draft. Will she identify the provenance of the words, to the general circumstance prevailing in relation to housing in the district of the local housing authority", which appear in subsection (2)(2B) of the proposed new clause? The words are wide and I think they would probably be rather difficult to apply if they had to be construed as a matter of law.

I have great respect for Mr. Carnwarth, who in earlier and happier days was a valued member of what were then my chambers. I salute his draftsmanship. It would help the Committee if the noble Baroness could identify the provenance of that phrase.

Baroness David

I cannot immediately answer the noble Lord, but my noble friend would like to say something on this matter.

Lord Elystan-Morgan

I am not aware that the words have been culled from any specific statute. If it be that the noble Lord opposite fails to identify their parentage, I doubt whether any other Member of the Committee will be able to do so.

Lord Skelmersdale

If I may answer the point, I have been advised, rapidly and I hope correctly, that the provenance is in subsection (2)(2B) of Section 60(4) of the Housing Act 1985. I do not know whether my noble friend has a copy of the Act with him. Perhaps he can prove me wrong as well.

The noble Baroness's amendment marks a further stage in the attempt to amend the present homelessness legislation in the light of the Law Lords' judgment in the Puhlhofer case. Our position is that we believe such amendments to be, at best, premature. I was interested in and listened carefully to what the noble Baroness said about evidence. Neither she nor Shelter have produced any substantial evidence to support their fears that the judgment is having an adverse effect on the treatment of homeless people. She said that there was evidence available. I have to tell the Committee that my officials inform me that nothing at all has been received by them. If there is evidence, I would be very grateful to see it, read it and consider it.

The Government asked for evidence earlier on the Housing (Scotland) Bill. Although several months have passed since then, we have still not received it. This is a complex and difficult area of legislation and before embarking on amendments we need to be convinced that the situation requires rectifying and if it does, to consider carefully what precise form the amendments to the legislation should take.

I am advised that the Puhlhofer case was not particularly revolutionary. There were earlier cases. For example, R. v. The South Herefordshire District Council, ex parte Miles, which indicated that accommodation would have to be of a very low level indeed before it failed to count as accommodation rendering the applicant not homeless. I am also advised that Puhlhofer did not decide that overcrowding was irrelevant. It would be relevant if so acute that the accommodation was not capable of accommodating the applicant and his family. It is because of the confusion in the minds of many of us that we have said that we shall monitor any change in the treatment of homeless people after the Puhlhofer case. We have done just this, but I am afraid that it is too early to be able to analyse the results.

More specifically, as stated in another place, we shall be covering the Puhlhofer aspect, along with others, in our postal survey (which I referred to in a debate in this House not long ago) which we have now begun of all housing authorities on their policies and practice under Part III of the Act, including the circumstances in which they accept people as homeless and the use of different kinds of accommodation for homeless people; in detailed case studies of selected authorities; and in my officials' regular discussions with authorities. We shall also be monitoring the regular quarterly statistics returned by authorities on homelessness and pursuing with them the reasons for any substantial changes in, for instance, the proportion of applicants found not to be homeless. In addition, we will be taking account of any further relevant court judgments and any evidence that the voluntary bodies—Shelter or anyone else—choose to submit to us from their experience in advising homeless people. Although I would accept that these amendments are perhaps milder and more moderate in tone than ones that your Lordships have previously considered in other Bills, we take the view that they would still be premature. It is unfortunate, I feel, that we were not given a little more notice of the amendments. But the noble Baroness made the point several times on Tuesday that she had not had sufficient notice of some of our amendments. So we can forget that one.

Baroness David

The noble Lord has, after all, plenty of civil servants.

Lord Skelmersdale

That is very true. Nonetheless, I was suggesting that honours on this unfortunate occasion were perhaps even.

Baroness David

The circumstances are very different.

Lord Skelmersdale

In any case, it seems much more sensible to await the outcome of our monitoring. The noble Baroness suggested that the Puhlhofer case leaves the law uncertain. If it is, and this is causing difficulties, our monitoring, which I have described very fully, will pick it up. The possibility of amending legislation can, if appropriate, be considered then. It seems an entirely reasonable stance for the Government to take. I hope that the noble Baroness will accept this in the spirit it is given.

Lord Broxbourne

I rise only to thank my noble friend for giving the answer to the identification of the provenance of the phrase to which I drew attention in the noble Baroness's new clause. I do not think that the noble Baroness, the noble Lord, Lord Elystan-Morgan, or indeed myself need apologise for not being aware of the precise provenance of this provision, tucked away, as it is, in the many hundred sections and schedules of the Housing Act 1985. But although he has provided the provenance—for which I am grateful—it does not remove my doubts and anxieties in regard to the form of words. Perhaps my noble friend, with the advantage of the advice of the everhelpful and conscientious officials of the Department of the Environment—all of us in these proceedings are indebted to them for their assistance—can take the matter one stage further. Section 60(4) of the Housing Act 1985, in which the provenance appears, is, of course, a very recent provision. I ask therefore this further question. Whence were the words derived for the purposes of the Housing Act 1985?

Secondly, have they had the benefit, either in any previous incarnation or under this Act, of any judicial interpretation? I am bound to say that the words strike me as odd. They are very generalised in what is a particular and technical subject. The words, general circumstances prevailing in relation to housing in the district of the local housing authority", may well give rise to a great deal of debate and difficulty in forensic exchanges under the Act or under the new clause if the Committee were to adopt it. I see that the ever-conscientious and informed officials have now given my noble friend the answer. We await it with the interest and respect it deserves.

Lord Skelmersdale

I cannot resist the temptation to say to my noble friend that this is not, actually, a Government amendment. It is an amendment in the name of the noble Baroness opposite. However, ever helpful, I shall provide the answer that my noble friend has asked for. It comes from Section 17(4) of the Housing (Homeless Persons) Act 1977. I am advised that it has had plenty of judicial consideration in the past.

Lord Broxbourne

Can my noble friend cite any decided cases?

Lord Skelmersdale

This is becoming too involved for me to be able reasonably to cope with it at the moment. I hope that I may be allowed to write to my noble friend on that point.

Lord Elystan-Morgan

I tender my humblest apologies to the Committee for being unable to pick out at an instant the origin of the phrases used in the amendment. In mitigation of my sin I am sure that the Committee will accept from someone who normally practices in the criminal courts that one regards housing legislation as a frightening terror incognito. I would, however, ask the Government to accept that a position of considerable danger has been created by the decision in the Puhlhofer case. In saying that I make not the slightest criticism of the opinions of noble and learned Lords. Their duty, after all, is to decide what the law is. Equally, it is our duty as a House of Parliament to decide what the law should be. It is a potentially dangerous and unsatisfactory situation. Although it is true that these are in one sense early days, in so far as our experience of the Puhlhofer situation is concerned—the matter was decided, if I remember rightly, in February this year—it is nevertheless very late in the day so far as the passage of this Bill is concerned. We have every sympathy with the Government, who may well consider that it is far too late to take on board an amendment of this nature.

Nevertheless, if it is the Minister's undertaking as I understand it, that the Government are prepared to look carefully at the situation and that they are prepared to say they will act on the basis not of what Puhlhofer now shows the law to be but what they intended it to be in 1985 when the legislation went through Parliament, then I have little doubt that my noble friends on this side will regard that as a reasonable undertaking in the circumstances.

Lord Dean of Beswick

May I put a very brief point? I was interested to hear the Minister say that the department was monitoring the situation on homelessness at present. Bearing in mind that the number of people under the present Act is increasing significantly, can the Minister indicate when such monitoring will be completed or will be advanced enough for the Government to take the necessary action? If it required action by the Government would it necessitate new legislation in both Houses or can it be done by an order, because of the time factor? We are reaching a serious situation.

Lord Skelmersdale

I referred to the monitoring, which is a survey of all housing authorities on their policies and practice under Part III. That is what I called the monitoring. I said that if there were problems, as described in the comments on the result of the Puhlhofer case, that monitoring would pick them up. I also said that if there were any concrete evidence emanating from noble Lords on that side of the Committee, from Shelter, or any other voluntary bodies, that would be looked at with all speed and dispatch.

Lord Dean of Beswick

I am extremely grateful for what the Minister has said so far. However, can he indicate when the monitoring will take place so that it can be analysed and the Government can take the necessary action? What is the time factor for the ending of the monitoring and the analysis resulting from it?

Lord Skelmersdale

To the best of my knowledge and belief it is going on now and has been going on for some months. But I am advised that it will be completed some time towards the end of next summer—that is, summer 1987. I do not know whether Members of the Committee will consider that satisfactory, but that is the answer that I must give the noble Lord.

Lord Carmichael of Kelvingrove

Will the Minister tell us whether that will be before or after the election?

Baroness David

I thank the Minister for his reply, which had some crumbs of comfort in it. I am surprised by what he says about their having had no evidence. I shall make inquiries about that because I was told specifically that Shelter had provided evidence. I shall certainly make investigations about that.

I did not make this point because I thought I had spoken for long enough when I opened, but I should like to say that there is support for legislation to take place on the Puhlhofer judgment from a distinguished member of this House, the noble and learned Lord, Lord Wheatley. I have had a letter from him which says: Had I been able to come to London I would have been happy to give the amendment my full support, but unfortunately I have to go into hospital next week for a check up". However, he says: I wish you every success in your endeavours to get the law put right in this matter". I hope that that too will carry some weight with the Government when they are considering what they will do. I shall read very carefully what the Minister has said, but in the meantime I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Hooper

This may be a convenient moment to take the dinner break. Perhaps I may suggest that we adjourn therefore until about 8 o'clock. I beg to move that the Committee do now adjourn.

[The Sitting was suspended from 7.4 to 8 p.m.]

House again in Committee.

Clause 8 [Extension of assured tenancies scheme to cases where works have been carried out]:

Lord Daviesmoved Amendment No. 70: Page 23, line 3, at end insert— ("In Section 56(4) of the Housing Act 1980 after the word "bodies" insert "or person,".").

The noble Lord said: I beg to move amendment No.70. First, I should like to declare an interest: I am a builder. I liked the lengthy earlier debates we had on the right to buy. The assured tenancy scheme can lead to a real increase in the number of houses available to rent. Unfortunately, the removal of capital allowances had pulled the rug from successful existing schemes. In a recent survey carried out by the Rowntree Trust, which has not yet been published, 82 per cent. of the approved bodies questioned said that their investment plans had been affected substantially by the loss of capital allowances. But in the same survey 60 per cent. said they expected to make use of the new arrangements proposed in this Bill. However, I am sure that very many of the existing properties that could benefit from the terms of this Bill are in fact owned by persons rather than bodies.

By restricting the definition to exclude individuals, many people owning houses that they are afraid to let for fear of the effects of the Rent Acts will continue either to under-occupy, or keep houses vacant which could be let. If we are seeking to maximise the use of vacant stock and to provide access to a pool of cheaper housing, individuals must be able to let assured tenancies. This amendment opens the way for approved persons to be designated as well as bodies.

If Members of the Committee are concerned that persons may not be competent to manage assured tenancies, there is already provison for approved bodies to employ agencies to take over mangement duties, and for such agencies to be vetted as part of the approval process that already exists. The employment of such agencies could be made obligatory by persons before approval is granted. Therefore, I wonder whether the Government will consider changing the rules and following the lines of this amendment, so that persons, as well as bodies, could be the owners of properties benefiting from the scheme. I beg to move.

Baroness Hooper

I recognise that the noble Lord, Lord Davies, has as his purpose in tabling this amendment the encouragement of the provision of more privately rented accommodation. The Government whole-heartedly share that aim. As my honourable friend the Minister for Housing said at Bournemouth on Tuesday: this Government will not tolerate the continued decline of free-choice renting, which deprives our people of an essential service. We hope in future legislation to put further proposals to the Committee to improve the choice of accommodation available to private tenants while protecting existing tenants and giving new tenants proper consumer protection as well.

The present Bill, however, has a much more limited purpose. The aim of Clause 8 is to extend the assured tenancy scheme to include improved as well as newly-built property. The scheme is confined to bodies approved by the Secretary of State. Individuals cannot receive such approval. We think it best at this stage not to amend the approvals system. Widening the scheme to include individual as well as corporate landlords would be a much more far-reaching step than we would want to take at present, not least because the substantial rise in the number of applications could make it difficult to ensure that only reputable and responsible landlords received approval. Nevertheless, I note the point the noble Lord has made concerning agencies. Of course, this will be considered in any future consideration of further proposals. I hope on this basis that in view of what I said the noble Lord will decide not to press the amendment.

Lord Davies

That is reassuring to know that will be considered. I do not see the objection on the approval of vetting arrangements, if as we understand agencies are being set up to run approved bodies' properties. But the substantial amount of property that could well come to the market by this arrangement should be excluded. However, I shall nevertheless withdraw my amendment if it is going to be further considered.

I beg leave to withdraw.

Amendment, by leave, withdrawn.

Lord Dean of Beswickmoved Amendment No. 71. Page 23, line 20, leave out ("is (or was) fit for human habitation") and insert ("has (or had) a certificate of repair").

The noble Lord said: I should like to speak to Amendments Nos. 71 and 74 and also to speak and address my remarks to the government amendment, Amendment No. 73. I rise to speak to Amendments Nos. 71 and 74 on assured tenancies.

Lord Skelmersdale

Perhaps I may interrupt the noble Lord for one second. Will he allow me to speak to my amendment, Amendment No. 73, at the same time as responding to his?

Lord Dean of Beswick

I think that it is a logical solution. Amendments Nos. 71 and 74 deal with the question of the physical standard of accommodation provided under assured tenancies. We consider the Government's approach on this is unsatisfactory. The Government propose a minimum level of expenditure on improvements, repairs or conversion, before an assured tenancy can be created on refurbished property.

I understand in a letter to Mr. Alan Roberts, MP, the Housing Minister, Mr. John Patten suggested a minimum expenditure of £6,000 in London and an unspecified but lesser amount elsewhere. He did not commit himself to public consultation over the exact sums, but this may well be a delaying tactic with a final decision only being made after the passing of the Bill. Thus, the matter would be left to a parliamentary order.

This issue needs to be pursued now. The consultation needs to be carried out urgently with a clear indication being given to the Committee as to the latest Government thinking and the timetable for consultation, so that the minimum sums can be debated before the Bill becomes law.

The most important consideration is the condition of the accommodation to be let under an assured tenancy. The minimum sums should follow from that, not the other way around. Our amendment seeks to pursue such an approach with no letting under an assured tenancy being possible, unless and until a local authority has certified that the statutory minimum standards for the condition of the accommodation have been achieved by the prospective landlord.

In our view, the standards set should be far higher than the basic statutory fittings standards, which are a remnant from another age. We think the minimum expenditure should be at least double that originally proposed in order to do the job properly. It must be remembered that in advocating an assured tenancy scheme the Government's main claim is that it will help provide more homes for rent of a higher standard. The landlords concerned will benefit from market rents which are potentially very high indeed. As the proposals stand, the level of rent an approved landlord could charge would not be matched by the quality of the accommodation. Those are some of the worries which we have about this clause of the Bill.

Amendment No. 71 deals with the physical standard of the accommodation, and we consider that the Government's approach is unsatisfactory. Instead of first ensuring that the standard of works is high, it relies on very low minimum levels of expenditure. The tentative levels proposed by the Government in the Commons Committee was £6,000 in London and, as I said before, less elsewhere. The Government will consult on the final figures but we believe this will mean delay until after the passage of the Bill and also reliance on an order. That is not acceptable.

We believe that the most important consideration must be the condition of the property after works and there should be a duty on approved bodies to obtain certification from the local body before being able to let. The standards set should be higher than the basic fitness standard, which in any case had its validity in another age. That is what this amendment seeks to achieve, and we think that the £6,000 tentatively proposed should be doubled. The further amendment is a replacement for the Government Amendment No. 73, but it follows the same format. It makes the necessary consequential amendment to Section 56B(1) (b) of the Housing Act 1980. Instead of setting high standards and relating adequate minimum cost limits to work carried out, the Government have opted for a simple global cost limit. At present this stands at £5,000. The standard aimed for is the minimum fitness test but there is no proposal in the Bill to test the quality of works carried out as a prerequisite of qualification for assured tenancy status. It is our view that the cost limit is far too low.

The £12,000 was mentioned during the Commons Committee stage of the Bill but even that sum might in many cases now prove too low. It is essential that an adequate cost limit be adopted and equally essential that a system is introduced whereby the finished product has to be tested before assured tenancy status is allowed. Ideally, new-build standards based on the building regulations should be built into the scheme but at the very minimum the end of works should be followed by a mandatory survey by the local authority to check whether the "certificate of repair" should be granted. The certification process proposed is loosely based on Section 234 of the Housing Act 1985. We have already said that the minimum figure should be double the £6,000 proposed by the Government.

It must be remembered that, in advocating the assured tenancy scheme, the Government's main claim is that it will result in the provision of homes of a high standard. The landlords concerned will benefit from market rents which will potentially be very high indeed. When the initial scheme was created in the Housing Act 1980 it was limited to new-build accommodation. Therefore, it is essential that the improved, repaired or converted accommodation produced under the expanded scheme should meet standards similar to those which apply in the case of new building, otherwise we would have double standards.

The Bill as it stands is a recipe for high rents in exchange for what could be low-quality accommodation. The Government have so far refused to give any indication of how they arrived at the £6,000 minimum sum for London and less for elsewhere, beyond saving on 25th March 1986 at col. 469 of the Official Report of another place: The weighted average of estimated expenditure on grant-aided repairs and improvements in England in 1984–85 was £6,000. As that is the weighted average the prescribed amount might be set slightly below the figure at £5,000, for example, with a higher figure in Greater London". The Minister then said that the Government would "think again" on these amounts because Hon. Members do not consider that level to be enough". It is worth noting that the grant-aided works average covered a lot of different types of work of varying degree of expenditure. Many of these grants will be for the provision of basic amenities, often a single basic amenity, and the expenditure involved will be well below £1,000. This can only have the effect of distorting the average to the extent that it will be almost meaningless when used for the present purposes. The Government themselves, when setting grant aid for the purposes of the mini-housing association grant via the Housing Corporation, have set only a slightly lower figure, around £3,500, for very basic works indeed where the property after works is expected only to have a useful life of five years, which is a very short life indeed.

The 1981 English House Condition Survey, which is now five years out of date—I think that one is expected this year or early next year—indicated that there were even then over 340,000 dwellings rented from private landlords which were in need of repairs costing £7,000 or more, and that was at 1981 prices. It would be much more now. In total there were 1 million dwellings requiring that much expenditure or more on works, and 1.1 million dwellings were actually deemed to be unfit.

The burden of our amendment is that the standard of the accommodation produced is of first importance—the amount to be spent should follow, not lead, the process—and in many cases we believe the works required to achieve acceptable standards will cost two or three times the amount which the Government are at present prepared to consider. They have the issue the wrong way round and have severely underestimated the levels of expenditure which will be required. The problems that this approach will store up for the future will be exacerbated by the Government's failure to insist that no letting is possible unless a certificate of repair has been obtained.

Those are our reasons. As I said, we think that the £6,000 proposed by the Government would be totally inadequate. We believe that double that at least would be required and with the passage of time it will need to be more than that. Therefore I beg to move.

8.15 p.m.

Lord Skelmersdale

These amendments relate to the provisions of Clause 8, which extends the assured tenancy scheme to property which has been improved, repaired or converted. The extension of the scheme was welcomed by all parties in another place, but I must say that from the speech of the noble Lord, Lord Dean, I did not sense that he disapproved of the basic tenets of Clause 8.

Perhaps I may remind the Committee that assured tenancy lettings may only be made by approved bodies—that is to say, landlords approved by the Secretary of State and by Parliament—under an order subject to negative resolution. Approved bodies are therefore by definition landlords who have proved themselves to be reputable, trustworthy and reliable. At the moment there are about 200 of them, including building societies, financial institutions and housing associations. It is always invidious to name names, but the Committee will recognise such approved bodies as the Abbey National, the Nationwide and the North Housing Association.

Lord Dean of Beswick

Can the Minister give us the number of assured tenancies in being at present and say whether they are still increasing substantially or whether they are dormant?

Lord Skelmersdale

We shall come to that point in due course. Amendment No. 73 is a government amendment. It provides that an approved body cannot let property on an assured tenancy under the extension to the scheme unless it is fit for human habitation. The test of fitness for human habitation which we have chosen is closely based on that in Section 604 of the Housing Act 1985 with which we had a little play before dinner, in turn derived from the Housing Act 1957 and earlier legislation. As it will also be necessary for a substantial sum to have been spent on works to the property, the standard of accommodation provided will in the great majority of cases be well above the fitness standard.

There may, however, be a few borderline cases, and in these circumstances it is desirable that both landlord and tenant should be certain that the letting created fully meets the requirements of an assured tenancy. Amendment 73, the government amendment, therefore provides procedure to enable an approved body, where it appears appropriate, to obtain a certificate of fitness from the local housing authority on payment of a reasonable fee in respect of any property which it proposes to let on an assured tenancy.

The noble Lord, Lord Dean, has spoken to Amendments Nos. 71 and 74, which modify the proposals in government Amendment No. 73. The amendments go considerably further than our own proposals. They require certification in every case and the creation of an entirely new standard specifically for the purpose of an assured tenancy scheme. They also require the landlord to maintain the property at that standard. They are therefore considerably more bureaucratic than we had in mind and would add substantially to the burden on the local authorities who would operate the certification system.

Compulsory certification is neither necessary nor desirable. It is not necessary because if an approved body is in doubt whether a property meets the required standard, it is in its own interests to apply for a certificate itself. If it does not and it later transpires that the property did not meet the standard, the approved body will find that it has created a Rent Act tenancy. It is not desirable because of the extra burden it would impose on local government and the costs and manpower implications that that would entail.

The standard of fitness we have chosen has been in use, as the noble Lord will know as well as I do, for many years. Local authorities are well versed in its use and the property world generally is familiar with it. The standard is also relatively objective. That, I am afraid, cannot be said of the alternative standard proposed by the noble Lord in this amendment.

This introduces a test that the property must be in reasonable repair. What does that mean? Will it or will it not be applied consistently by local authorities up and down the country? Also under the proposals in the amendment, local authorities would have to satisfy themselves that the property is likely to be available for letting as a dwelling for a period of 30 years. How is any management authority in the housing field, whether a local authority or anybody else, supposed to form a view on that? How do they know that the landlord will not decide to sell the freehold to the tenant at some future date?

On the other hand, what if the local authority knows that the property may need to be demolished in, say, 12 or 15 years' time under a road widening scheme? Does this mean that they cannot give it a certificate to enable the property to be let on an assured tenancy in the meantime? I do not think that that can be what the noble Lord has in mind. Under our proposals, the fitness standard is intended to be a once-and-for-all test which the property must satisfy before it can be let on an assured tenancy. It has no relevance to the condition of the property after it has been let.

Under the amendment's proposals, however, the landlord would be under an additional obligation to maintain the property to the prescribed standards throughout the period of the assured tenancy letting. It is not clear what sanctions would apply if the landlord did not manage to achieve this obligation. Presumably the intention is that the letting would cease to be an assured tenancy. I do not think that this is a satisfactory situation, and to be fair to the noble Lord I do not think that this is what he intended in the amendment in the first place.

A landlord, once having created an assured tenancy, needs certainty that it will remain so, but if the continuation of the assured tenancy depends upon the continuing state of the property he no longer has that certainty. The state of the property may no longer be within his control. For example, the lease may be a long lease and may, therefore, place contractual repairing obligations on the tenant. Why should the landlord suffer if the tenant does not fulfil his obligations? Alternatively, the repairing obligation may be with the landlord, but the tenant might so mistreat the property as to bring it below the prescribed standard. Again, is it fair to penalise the landlord in these circumstances?

The Government have said, on the figures that the noble Lord was questioning, that they will consult publicly on the amount to be prescribed, and the consultation will, I am advised, start within the next two weeks and before the Bill leaves this Chamber. Any results that come—and we are expecting results to come—would have to be incorporated in an order which the noble Lord, if he so desires, will be able to pray against, it being a negative resolution. Therefore, we do not need this Bill to achieve the objective of that particular part of the amendment.

The essence of the assured tenancy scheme is that it is available only to landlords who can be relied upon to act in a responsible manner. It has survived until now with a minimum of bureaucratic control. Our proposals in this Bill represent a sensible step forward in widening the application of this scheme. I hope we shall not frustrate the achievement of a very limited objective by discouraging approved landlords with the prospect of burdensome and unnecessary controls.

In answer to the noble Lord's question, which he slipped at me rather unexpectedly as I was beginning this speech, there were 609 assured tenancies on 1st April 1986. In other words, I freely admit that the scheme has made disappointing progress, which I think was perhaps the point that the noble Lord wanted to draw out of me. But for all I have said in this, I appreciate, rather long but important response, I invite the noble Lord to withdraw his amendments and to support the government Amendment No. 73.

Lord Graham of Edmonton

I am intrigued by the confidence the Minister has in the approved tenancy nexus within the housing field. I understand that there are about 200 approved bodies, and the Minister has told us that collectively they are responsible for 609 tenancies. That is a ludicrous pimple on the face of the housing condition in this country.

When his political colleague in another place, Sir Geoffrey Finsberg, raised this matter and dealt with it in 1980, he said on 18th March, at col. 1213 of the Official Report: The sort of organisations that the Government have in mind for approval are building societies, pension funds and insurance companies". If collectively in six years bodies of that kind have been responsible for 609 tenancies at the end of the period, I want the Minister to spend some time tonight in justifying this abysmal failure. He was more polite than that when he mentioned 609, but there is something wrong.

The people that the Government have in mind are the friends of the Government—building societies, pension funds and insurance companies. These things are not drawn out of thin air; they are conceived by people who believe there is a place and purpose for this aspect of housing. I do not deny that the Government have been quite good at creating initiatives, but I cannot see the value of pursuing and extending that.

In the first instance, the assured tenancy nexus related to new buildings, and now what we have in the present Bill is that it is going to be extended to improved, repaired, or converted dwellings. We ought not to be under any illusion about the extent to which there is comparability between a person who is a tenant who enjoys an assured tenancy and a tenant who has some other kind of tenancy. For the assured tenancy, security is inferior to Rent Act security and to Housing Act security. I want the Minister to spend a little time saying what he has done in the past six years to monitor what his friends in other places have done, upon whom such high hope was rested.

I have in my hand a document giving the results of a piece of research. It tells me that a recent survey found that only nine of the bodies that were originally listed were financial institutions and that the rest comprised 88 building and construction companies, 65 property investment companies, nine non-incorporated bodies and only 15 housing association satellites.

I am fairly certain that the Government hoped that the scheme would attract financial institutions to take on some of the burdens that hitherto had been carried by local authorities and by housing associations. Before he leaves this matter—and I shall be very interested to hear what my noble friend on the Front Bench will have to say on our intentions over pressing our amendment—I think that the Committee and the country at large would benefit from an extended justification by the Minister of the whole idea of assured tenancies.

8.30 p.m.

Lord Dean of Beswick

I am grateful for the intervention of my noble friend Lord Graham of Edmonton. I was not aware of the figures that the Minister gave. We were not bowling a fast ball at him or a bumper when I asked him how many assured tenancies there were. It seems to me pretty obvious —and I think the Government will have to admit it—that on the basis of those numbers over the year and of the number of people involved in providing those 600-odd assured tenancies, the thing has been a flop in terms of dimension. With my natural, political "non-coyness"—something from which we all suffer in this building—I assume that the new scheme is designed to do something similar to that which the Government are hoping to do by raising discounts, so as to make the scheme more widespread and encourage a bigger take-up.

One of the things that I think the Government have wrong—and I hope I did not mishear the Minister when he replied; and, of course, it is in the amendment—is over the matter of the 30 years which we are talking about. I was always led to believe that when public money was being spent or used or when one was allowed to use it on property repair, renovation and management, 30 years was a normal figure in that connection. Certainly, I have never heard anybody talking of fewer than 15 years. To talk about spending even £6,000 on a property, basing that on a five-year life, is to me complete and utter nonsense.

I would think that if you were going in for this exercise on the basis of rescuing properties from deterioration and making them assured tenancies, it would be throwing good money after bad if you did not spend enough on them to give them something like a 30-year life. Most of the properties that we are talking about are probably basically conventional, brick-construction houses on which it is very often worthwhile to spend money to rescue them from deterioration and to keep them as part of the housing stock. To say that 30 years is pitching it too high, that conditions may be this or that in 30 years' time is one thing, but a lot of us will not be here in 30 years. But one has to deal with things as they are and as you think they will appear to be. To talk about houses being knocked down, and so on, seems to ignore the fact that that can happen to a house whether it is an assured tenancy, whether it is owner-occupied, whether it is a Crown Agents' house or whatever. To bring that type of thing in is a little bit of a red herring. My own view is that if the Government are expecting this scheme on the basis of the figure that the Minister has given tonight—that of 600-odd tenancies over the number of years that it has been in being—to succeed is tilting at windmills. I think I have made the point quite forcefully that to talk in terms of the house having what you could call a "fit life" for five years is a nonsense. If we are going to do it, let us do the job properly. Having heard what the Minister has said, and because of the time involved, I am not going to press the amendment. It may be that we can come back to this at a later stage. By leave, I withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Dean of Beswickmoved Amendment No. 72. Page 24, line 8, at end insert— ("( ) Section 38(4) of the Landlord and Tenant Act 1954 shall not apply to assured tenancies.")

The noble Lord said: This amendment deals with the security of assured tenants. Although it is not specifically so, it is part of the principle of the security of the tenants. There is an assumption built into the Government's case for assured tenancies that they are based on security of tenure. The Government should admit to what this really amounts to. Assured tenancy security is very inferior and nothing like the Rent Act security or Housing Act security under these Acts. As they affect private and council tenants and housing association tenants, the onus is on the landlord to prove a case for repossession. Under assured tenure, the onus is on the tenant to apply for a new tenancy should the landlord seek to end the existing one. The procedures are complex in the extreme and full of problems for an ill-informed tenant.

In the realm of business tenancies under the Landlord and Tenant Act 1954 (on which this scheme is based) these procedures are the cause of more claims in negligence against solicitors than any other area of the law. If solicitors get it wrong, what hope is there for tenants? Not only are the grounds that the landlord can use for opposing a new tenancy much wider than grounds for possession in the normal tenancy Acts, but there is no right to succession in the case of assured tenancies and the court is not required to apply a test of reasonableness in considering an order. But—and this is the subject of one of our proposed amendments—as the Bill stands, it is a comparatively simple matter for an "approved body" to contract out of the bulk of the limited safeguards the tenure gives the tenants. To us this is utterly and entirely unacceptable. That is why I move this amendment.

Lord Skelmersdale

The Committee will be aware that tenancies granted under the assured tenancy scheme are subject to broadly the same statutory regime as that which applies to business tenancies. Market rents may be charged and the tenant has the right to renew his lease. Section 38(4) of the Landlord and Tenant Act 1954, to which the amendment refers, put simply, allows landlord and tenant to "contract out" of the Act with the consent of the court. There is that valid safeguard.

There may be a risk that landlords would exploit this provision by forcing the would-be tenant to give up his rights as a condition of granting him a tenancy. In view of the need to obtain the court's consent, I would not realistically expect that to happen, Certainly, so far as we are aware, this provision has not been used by landlords granting assured tenancies. However, I agree that there may be a possibility of abuse as described by the noble Lord. I can see why he wishes to prevent contracting out in this context. In other words, I readily accept that the noble Lord has a point and a good one. If he will agree to withdraw his amendment, we shall look into it and consider whether we can come back with an amendment of our own at a later stage.

Lord Dean of Beswick

I am grateful for the Minister's helpful answer. Of course, I shall withdraw the amendment and look forward to what the Minister may be able to come back with at a later stage.

Amendment, by leave, withdrawn.

Lord Skelmersdalemoved Amendment No. 73:

Page 24, leave out lines 35 to 37 and insert—

("Certification of fitness for purposes of s. 56B.

56C.—(1) An approved body having an interest in a dwelling-house which it proposes to let on an assured tenancy may—

1. (a) apply in writing to the local housing authority for a cetrtificate that the dwelling-house is fit for human habitation, or
2. (b) submit to the local housing authority a list of works which it proposes to carry out to the dwelling-house with a request in writing for the authority's opinion whether the dwelling-house would after the execution of the works, be fit for human habitation;

and the authority shall as soon as may be after receiving the application or request, and upon payment of such reasonable fee as they may determine, take the matter into consideration.

1. (2) If the authority are of opinion that the dwelling-house is fit for human habitation, they shall give the approved body a certificate to that effect.
2. (3) If the authority are of opinion that the dwelling-house will be fit for human habitation after the execution of the proposed works, they shall inform the approved body that they are of that opinion.
3. (4) In any other case, the authority shall give the approved body a list of the works which in their opinion are required to make the dwelling-house fit for human habitation.
4. (5) Where the authority have responded in accordance with subsection (3) or (4) and the works in question have been executed to their satisfaction, they shall, if the approved body applies in writing, and upon payment of such reasonable fee as the authority may determine, give the body a certificate that the dwelling-house is fit for human habitation.
5. (6) For the purpose of determining whether the condition in section 56B(1)(b) was satisfied in any case (fitness of dwelling-house on relevant date), but not for any other purpose, a certificate given under the section is conclusive evidence that the dwelling-house was fit for human habitation on the date on which the certificate was given.
6. (7) In this section 'the local housing authority' has the same meaning as in the Housing Act 1985.

Fitness for human habitation.

56D. In determining for any of the purposes of section 56B or 56C whether a dwelling-house is, or would be, fit for human habitation, regard shall be had to its condition in respect of the following matters—

• repair,
• stability,
• freedom from damp,
• internal arrangement,
• natural lighting,
• ventilation,
• water supply,
• drainage and sanitary conveniences,
• facilities for the preparation and cooking of food and the disposal of waste water:

and the dwelling-house shall be deemed to be unfit only if it is, or would be, so far defective in one or more of those matters as to be not reasonably suitable for occupation in that condition"."

(3) In section 57 of the Housing Act 1980 (effect of interest of landlord ceasing to belong to approved body), in subsections (1) and (2) for "section 56(3)(a)" substitute "section 56(1)(b)".").

The noble Lord said: I beg to move Amendment No. 73. We spoke to it with the group, Nos. 71, 73 and 74. I beg to move.

[Amendment No. 74 not moved.]

Lord Skelmersdale

I think we agreed that Amendments Nos. 75 and 76 were to be taken together.

Baroness David

That is what my note says.

Baroness Davidmoved Amendment No. 75: Page 24, line 37, at end insert— ("( ) In section 57(1) of the Housing Act 1980, after ("section 56(4) of the Act, then") insert ("(subject to subsection (2) below).").

The noble Baroness said: The point of these amendments is to protect tenants if the landlord loses approved body status because of malpractice. As the Bill stands, if a landlord loses approved body status because of malpractice the tenants remain as assured tenants of that landlord. We feel this cannot be justified. These tenants should be brought within the full protection of the Rent Act 1977. This is what our amendment seeks to achieve. I beg to move.

8.45 p.m.

Lord Skelmersdale

Landlords who have their approval withdrawn are already prevented under the assured tenancy legislation from creating any further assured tenancies. The effect of these amendments would be to deprive them of their existing assured tenancies, presumably by converting them into tenancies to which the Rent Acts would apply.

I do not think it is right to penalise landlords in this way in respect of existing assured tenancy lettings. The Secretary of State's powers to grant and withdraw approval are currently widely drawn. The amendment could cast doubt in the mind of an approved body about the position of assured tenancy lettings if government policy were to change. An approved body needs reasonable certainty that, having once created an assured tenancy, that tenancy will be allowed to continue; otherwise it has no protection for its investment. If that certainty is put in doubt, as it would be by these amendments, the pratical effect would be to discourage investment in the assured tenancy scheme. I hope, in view of what I have said, that the noble Baroness will not pursue these amendments.

Lord Graham of Edmonton

I do not quite know what the Minister expects to happen. We are looking back on a period in which assured tenancies were encouraged and in six years we have 600. I am not at all certain what the detrimental effect of these measures will be if, as the Minister says, they will discourage the creation of assured tenancies. In the event that an approved landlord, for whatever reason (and we are talking about a malpractice of some kind) ceases to earn and retain the status, we are talking about the innocent tenant and how he is left. We are saying that in those circumstances it is not unreasonable that the tenant becomes a fully protected Rent Act tenant.

I admit that in my view a fully protected Rent Act tenant is in a better position than an assured tenant. All this amendment seeks to do is to use belt and braces. The innocent people, who have not caused the damage and the distress to their circumstances, are faced with the consequences of unfortunately having, in this narrow context, a bad landlord. If the Minister can assure us, in other words, that there is no way in such circumstances in which the tenants will he detrimentally affected, perhaps my colleagues on the Front Bench may take a more benign view of the matter.

Baroness David

I too should like that assurance from the Minister, because it is very important from the tenants' point of view.

Lord Skelmersdale

I am glad we heard the word "tenants" just now from the noble Baroness. But before I respond to that point, the noble Lord, Lord Graham, sought to make capital out of the number of 600 assured tenancies. In answer to a point on the last amendment, it may be correct to tell him that the department carries out an annual survey of approved bodies. The last survey was carried out in April and there is a copy in the Library. That is where the figure I produced earlier came from.

The purpose of the assured tenancy scheme, when it was introduced in 1980, was to encourage new investment in private rented accommodation and I freely admit, as I did then, that the progress of the scheme has been disappointing. That is why we want to widen it by including not only new buildings but substantially refurbished buildings, as explained in Clause 8.

The noble Baroness and the noble Lord asked what would happen to the tenants of bodies who lose approved status. The answer is that they would come under the Rent Acts, and so they would not be—

Lord Graham of Edmonton

Disadvantaged?

Lord Skelmersdale

I am grateful to the noble Lord, I think perhaps it would be fair to point out that, if approved, the Opposition's amendments would not only penalise landlords who lost their approved status but would also damage the tenants' interests. Assured tenancies may normally be freely assigned unless the lease includes a specific prohibition on assignment or requires that the landlord's consent be obtained. The assured tenant may pay a premium for his lease and may have the right to assign it at a premium. If, as the amendment proposes, the removal of the landlord's approved status causes any tenancies he has granted to cease to be assured tenancies, they become regulated tenancies. In these circumstances the tenant would in most cases lose any right which he may have to assign the tenancy at a premium. If he himself has paid a premium for the lease he would therefore suffer a financial loss.

Lord Dean of Beswick

I think most people know that the original scheme was for new properties only and the Bill would extend this to older property. Did the Minister use the words "substantial improvement" in answer to my noble friend Lord Graham? That raises a query as to what the Government mean by "substantial". If I am any judge of work that is done in property now in the way of repair, rehabilitation and improvement, £6,000 will not go far towards such work in London or the South-East. This is where we must come back once again to the fact that that may well even double, and that may be an underestimate. This may be one of the cases where the scheme may founder due to the money made available being totally insufficient.

Lord Skelmersdale

I can do no more than repeat the assurance I gave in answer to the last amendment, that we will consult, and consult rapidly, on that.

Lord Davies

It is not a question of the money being made available, but a question of what amount of money is required to bring it up to the fit standard as described in the earlier amendment. I cannot see that we should mind how much we spend on it when the important thing is what the property ends up being. It will be up to the approved body to decide how much it is economical to spend, but at the end of the day the point is that it must be up to standard and that is what matters rather than the amount of money.

Baroness David

I think there is still some anxiety about whether this is entirely satisfactory. We shall read what the Minister has said, and if we are still anxious after that we reserve the right to come back at Report stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 76 not moved.]

Clause 8, as amended, agreed to.

Clause 9 [Other amendments relating to assured tenancies]:

Lord Skelmersdalemoved Amendment No. 77: Page 24, line 38, at beginning insert— ("( ) In section 19(5) of the Rent Act 1977 (contracts which are not restricted contracts), after paragraph (e) insert— , or (f) it creates an assured tenancy within the meaning of section 56 of the Housing Act 1980;".").

The noble Lord said: I never thought we would get to the hour when I could move a government amendment! I am relieved to be able to tell the Committee that this is a technical amendment to clarify the law by making express provision in the Rent Act that an assured tenancy cannot also be a restricted contract. The regime under the Rent Act for restricted contracts which are mainly lettings by resident landlords is not compatible with the separate statutory rights attaching to an assured tenancy under Part II of the Landlord and Tenant Act 1954. It was never the intention that the Rent Act should apply to assured tenancies, and this amendment puts the matter beyond doubt. I beg to move.

Clause 9, as amended, agreed to.

Lord Pitt of Hampsteadhad given notice of his intention to move Amendment No. 77A:

After Clause 9, insert the following new clause:

("Conduct against person of different racial or ethnic origin.

.In Schedule 2 to the Housing Act 1985 (grounds for possession of dwelling-houses let under secure tenancies) in Part I (grounds on which court may order possession if it considers it reasonable), after Ground 8 (temporary accommodation during works) insert—

"Ground

The tenant or a person residing in the dwelling-house has been guilty of conduct against a person of a different racial or ethnic origin on the grounds of his racial or ethnic origin in—

1. (a) such a manner that it interferes with the peace and comfort of the person aggrieved, or any member of his household, or
2. (b) such a manner that the person aggrieved, or any member of his household, fears for his safety, or
3. (c) such a manner as to cause nuisance or annoyance to the person aggrieved, or any member of his household.".").

The noble Lord said: I prefer Amendment No. 95 by my noble friend Lord Dean. I shall therefore not move Amendment No. 77A.

[Amendment No. 77A not moved.]

Clause 10 agreed to.

Schedule 2 [Common parts grants]:

Lord Skelmersdalemoved Amendments No. 78 to 84: Page 88, line 27, at end insert—

("PART I

AMENDMENTS OF PART XV OF THE HOUSING ACT 1985").

Page 89, line 10, leave out from ("out") to ("and") in line 11.

Page 90, line 23, after ("not") insert (", without the consent of the Secretary of State,").

Page 90, line 27, at end insert— ("( ) The Secretary of State's consent to the approval of applications where that standard will not be attained may be given in particular cases or in relation to descriptions of case.").

Page 95, leave out line 3 and insert— ("14.—(1) Section 526 of the Housing Act 1985 (the index to Part XV) is amended as follows. (2)").

Page 95, line 10, at end insert— ("(3) In the second column of entry relating to the expression "eligible expense" for "and 497" substitute ", 497 and 498F".").

Page 95, line 10, at end insert—

("PART II

AMENDMENTS OF OTHER ENACTMENTS

15. In section 116 of the Rent Act 1977 (consent of tenant to carrying out of works), in subsection (3) (cases in which county court may empower landlord to enter in absence of consent), for "improvement or intermediate grant" substitute "improvement grant, intermediate grant or common parts grant".

16.—(1) Part IV of the Housing Act 1985 (secure tenancies and rights of secure tenants) is amended as follows.

(2) In section 100 (power to reimburse cost of improvements carried out by tenant), in subsection (2) (cost to be net of grant), for "or repairs grant" substitute ", repairs grant or common parts grant".

(3) In section 101 (rent not to be increased on account of improvements carried out by tenant), in the second part of subsection (1) (application of provision where improvement grant-aided), for "or repairs grant" substitute ", repairs grant or common parts grant".

17. In section 244 of the Housing Act 1985 (powers of local housing authority with respect to environmental works in housing action area), in subsection (3) (no assistance for grant-aided works), for "or repairs grant" substitute ", repairs grant or common parts grant".

18. In section 255 of the Housing Act 1985 (powers of local housing authority in general improvement area), in subsection (2)(b) (no assistance for grant-aided works) for "or repairs grant" substitute ", repairs grant or common parts grant".

19. In section 535 of the Housing Act 1985 (exclusion of assistance under Part XVI (defective housing) where grant application pending under Part XV), in subsection (1)(a) for "or repairs grant" substitute repairs grant or common parts grant".").

The noble Lord said: Schedule 2 to the Bill contains the detailed provisions which introduce a new type of home improvement grant—the common parts grant—about which we had some discussion on Tuesday. This grant will be available for works of improvement and repair to the common parts of buildings containing flats and fills a gap in the existing system. It has been widely welcomed. This group of amendments seeks to make further changes to those provisions.

Some are minor or consequential, but Amendment No. 79, though small, makes a significant difference to the definition of those who can apply for this grant. By deleting a few words, it has the effect of enabling a tenant or a leaseholder to apply for a grant to do works even where these are the responsibility of the landlord, provided that they have his permission. This amendment will make the provisions more effective in helping flat-dwellers.

Amendments Nos. 80 and 81 enable a local authority, with the Secretary of State's consent, to reduce the standard which the building must reach after the grant-aided works are complete. Usually, in order to safeguard the investment of public money, the grant applicant has to bring his property up to a specified good standard as a condition of getting a grant. This may not always be reasonable, especially where the applicant is unable to get permission to do all the work that would be needed. We concede that there are circumstances where a relaxation of the standard would be justified, but because of the potentially very large sums which might be spent on buildings which were still not put into a state of reasonable repair, the Secretary of State's consent will be needed.

In making this very brief speech, it has occurred to me that I am so out of practice after this afternoon's experience of moving amendments that I did not advise the Committee I was actually speaking to Amendments 78 to 84 en bloc. Amendments Nos. 78, 82, 83 and 84 are consequential and provide for references to common parts grants and for these provisions to be inserted as necessary in existing legislation. I beg to move.

Baroness David

So far as I can see, and so far as I can understand from what has been said, this is an amendment to be welcomed, in that there will be grants for doing things for which there could not previously be grants in the general and common parts of buildings. So far as I have understood the amendments, we give them a welcome.

Schedule 2, as amended, agreed to.

Clause 11 agreed to.

Lord Skelmersdalemoved Amendment No. 92:

After Clause 11, insert the following new clause:

("Matter to be taken into account in determining fair rent.

.—(1) Section 70 of the Rent Act 1977 (determination of fair rent) is amended as follows.

(2) In subsection (1) (matters to be taken into account), omit the word "and" before paragraph (b) and after that paragraph insert— , and (c) any premium, or sum in the nature of a premium, which has been or may be lawfully required or received on the grant, renewal, continuance or assignment of the tenancy.".

(3) After subsection (4) insert— (4A) In this section "premium" has the same meaning as in Part IX of this Act, and "sum in the nature of a premium" means—

1. (a) any such loan as is mentioned in section 119 or 120 of this Act,
2. (b) any such excess over the reasonable price of furniture as is mentioned in section 123 of this Act, and
3. (c) any such advance payment of rent as is mentioned in section 126 of this Act.".

(4) The above amendments apply to every decision made by a rent officer or rent assessment committee after the commencement of this section, notwithstanding that the application was made before commencement or, in the case of a decision of a rent assessment committee, that the rent officer's decision was made before commencement.").

The noble Lord said: This, again, is a technical amendment to clarify the basis upon which a fair rent should be assessed under Section 70 of the Rent Act 1977 in cases where there is a premium. The Rent Act largely prohibits premiums, but there are certain types of Rent Act tenancies in which a payment received for premium is lawful. Examples—

Baroness Stedman

Will the noble Lord give way? The printing appears to be a bit higgledy-piggledy. Are we speaking to Amendment No. 86 or Amendment No. 92?

Baroness David

May I ask what happened after Schedule 2 to the Government's clause on shared ownership? I think it is reprinted as Amendment No. 103A. I am in some confusion about the order. It will be helpful if the Government can tell us.

Lord Skelmersdale

I am advised by the Table that the numbers are kept the same, but the clauses have been re-ordered so that they fit in with the Motion which I think my noble friend Lord Elton passed on the ordering of clauses for this Bill.

Baroness David

I am grateful for the explanation, but it is extremely confusing for the Committee to have the numbers of the amendments printed in the first Marshalled List switched about. It is difficult to know where we are. I am sorry if there is confusion, but I do not think that it is the fault of the Opposition.

Lord Skelmersdale

I am advised that for some reason, which I know not, it is the fault of the Government, and I shall have to get to the bottom of this matter. With the best will in the world, I am totally unable to do that this evening. Perhaps we can plough through the Marshalled List as it stands. Would that be convenient to noble Lords on the opposite side of the Committee?

Baroness David

May we know what we are going to do? Are we dealing next with Amendment No. 92, after Clause 11?

Lord Skelmersdale

I thought that I had started to speak to Amendment No. 92, which is after Clause 11. If the noble Baroness wishes me to speak to something else, and if it does not totally confuse all of us, I shall certainly do so.

9 p.m.

Lord Graham of Edmonton

What comes after Amendment No. 92?

Lord Skelmersdale

If I look at the Marshalled List correctly, No. 91 comes after No. 92.

Lord Graham of Edmonton

So we progress backwards.

Lord Skelmersdale

I suspect—my noble friend will correct me if I am wrong—that that is tautology. But I understand the sense of what the noble Lord has just said.

I had started to say, before this brief and somewhat lighthearted exchange, that this is a technical amendment to clarify the basis on which a fair rent should be assessed under Section 70 of the Rent Act 1977 in cases where there is a premium. This premium is largely prohibited in the Rent Acts, but there are occasions when such a premium is lawful. Examples are shared ownership leases granted by housing associations, certain long tenancies and certain tenancies granted by the Crown. The amendment establishes beyond doubt that the existence of a premium is a material factor to be taken into account in a fair rent assessment.

In the past there has been some difference of view between rent officers and rent assessment committees on this issue, with the unsatisfactory result that rents have been registered on different bases. The amendment will mainly affect existing shared ownership leases granted by housing associations, and will mean that in future the shared ownership leaseholder can be certain that the premium he has paid for the bought share of his property will be taken into account in determining the rent registered. I beg to move.

Lord Skelmersdalemoved Amendment No. 91: After Clause 11, insert the following new clause: "Further provisions with respect to shared ownership leases. The provisions of Schedule (Further provisions with respect to shared ownership leases) have effect to exclude certain shared ownership leases from the operation of the provisions of—

1. (a) the Rent Act 1977 and the Rent (Agriculture) Act 1976 and
2. (b) Part I of the Leasehold Reform Act 1967 (right of long leaseholder to enfranchisement or extension of lease).")

The noble Lord said: I apologise to the Committee for the length and apparent complexity of this new schedule to which I should like to speak in moving Amendment No. 91. I am moving Amendment No. 91 and speaking also to Amendments Nos. 103A, 322, 325 and 328. The schedule to which I referred is Amendment No. 103A on the Marshalled List and I shall endeavour to explain its purpose as simply as I can.

As the Committee will know, shared ownership is an arrangement which allows someone to part buy and part rent his or her home. So far, such arrangements have been provided almost exclusively in the residential context by local authorities, new towns and registered housing associations, relying on public sector finance. The particular advantage of shared ownership is that it brings home ownership within wider reach. Those who cannot afford to buy outright may be able to do so on shared ownership terms. It can also help labour mobility by enabling a home-owner moving to a job in an area where property prices are higher to reinvest the value of his home in a part share of a house in that higher priced area.

The Government maintain their total commitment to encourage shared ownership. One very important way in which we can help is by making it possible for shared ownership schemes to be financed entirely by the private sector. This would allow shared ownership to be offered on a much wider scale than at present. In particular, a few major building societies have expressed interest. Again, I discovered this in my investigations on the Building Societies Bill, now the Building Societies Act 1986.

There are at the moment two legislative obstacles—the Rent Act 1977 and the Leasehold Reform Act 1967—which make it difficult for those who might wish to make private finance available for shared ownership to do so. In some circumstances shared ownership leases, unless granted by a public sector body, may be caught by the provisions of one or both of these Acts. This situation is unsatisfactory. Under this amendment the Rent Act and the Leasehold Reform Act will be disapplied from future shared ownership leases. We intend to bring forward a further amendment on Report which will clarify certain tax aspects of housing association shared ownership schemes. I beg to move.

Baroness David

These are probably quite important amendments. If I may be quite clear that I have understood properly what the noble Lord said, it seems to me that the provision of homes for shared ownership has been restricted to councils and registered housing associations, and the Government's aim in this amendment is to widen shared ownership by allowing housing associations to provide homes under such schemes free of rent control and using private finance from building societies or perhaps from anywhere else.

What is the Government's aim in this? I suppose that it is to help first-time buyers to purchase a home in areas where it is particularly difficult—like London and the South-East—and to assist home owners who live in areas like the North of England where house prices are lower to move to areas where prices are a great deal higher. The point that I should like to make is that this year the Government have cut by nearly half the resources available to housing associations to provide shared ownership homes at a fair rent, so it would seem that one of the solutions would have been to give the housing associations rather more funds.

This amendment is designed to encourage the associations to use private finance to provide homes for shared ownership free of rent control. Is the Government's real aim the expansion or privatisation of the shared ownership programme? Is it right that these homes will be free of rent control?

The Government say that their policy in widening shared ownership is to help first-time buyers and to assist home owners in the North to move South. But the reason why home owners in the North and first-time buyers experience difficulties in purchasing in these high cost areas is that the Government are unwilling to take measures to prevent house prices spiralling beyond people's means and to control the increasing discrepancy between house prices in the South-East and elsewhere. In London and the South-East house prices have risen by 22 per cent. in the past 12 months. Do the Government intend to take any steps to prevent these fast-escalating house prices, which are quite ridiculous not only in London and the South-East but in East Anglia and in Cambridge, where I live?

Such measures could include a squeeze on mortgage lending, reducing mortgage perks or allowing councils and housing associations to build more decent low-cost rented homes. What we really need is more houses but reducing mortgage perks is a real possibility. It has been suggested strongly in the Duke of Edinburgh's report and again in Faith in the City. May we have a comment from the Minister on whether it is proposed to do anything about that?

The purchase of a shared ownership home at market rent could lead to real difficulties for first-time buyers and young couples. It would mean taking on a heavy financial commitment of high rent and mortgage repayments and could lead to complications of resale. Only a tiny minority of people on council waiting lists will in any case be in a position to benefit, which is a drop in the ocean of homelessness and indeed of those wanting to buy houses. We have to remember that people are defaulting on their mortgages all the time. House prices in this part of the country are a serious problem. I hope that the Minister can make a few comments on this shared ownership scheme.

Baroness Nicol

Before the Minister replies, perhaps I may intervene briefly. Probably uniquely in this Chamber I have almost first-hand experience of shared ownership, because a young member of my family embarked on the housing ladder by that means. Therefore I should like to say that I think it is an excellent scheme. Unfortunately, it is not yet widespread.

I am alarmed by the proposals before us this evening. If shared ownership, which is such a good thing, becomes the subject of a profit motive it will defeat the objective for which it was started. It gave so many young people a start at a price they could afford. They could buy a quarter of their house and pay rent on the rest of it. That price was reasonable because it was operated by a housing association. To take that into private ownership—I have no objection to profit; in its place, profit is essential to the wellbeing of us all—and to take away what was an excellent scheme which made low-price housing available, and possibly let prices get out of hand by doing this, is very wrong indeed. I am most alarmed that this will not be subject to rent control. I ask the Minister to think again.

Lord Skelmersdale

It is always refreshing in this Chamber to hear from someone such as the noble Baroness, Lady Nicol, who is able to bring pertinent thoughts to a subject through almost first-hand knowledge. Many of us have to suffer, at least from time to time, from not being entirely sure what we are talking about. I would say to the noble Baroness that if you buy a picture you expect to be allowed to sell it. If you buy that part of your house—the share that you own, as opposed to the share that you rent—why should it be any different? That is my answer to the noble Baroness. The noble Baroness, Lady David, when she described the amendment to me, got it, if I may say so, in one. She asked specifically what measures the Government propose to stop the ever-increasing rise in house prices. Obviously the Government are concerned about this, as indeed the Opposition are realistically concerned, because it is a problem. The rise in house prices, especially in the South-East of England, has advantaged a sector of the population—namely, the people who want to sell their houses—so it needs a great deal of thought before any government step in. But I can assure the noble Baroness that that thought is going on at the moment.

The noble Baroness also asked about mortgage relief. I believe that she has an honourable friend called Mr. Meacher, who also proposed at one moment that mortgage relief should be abandoned, which caused a certain amount—

Baroness David

I think that "reformed" was the suggestion of the Labour Party.

9.15 p.m.

Lord Skelmersdale

I am delighted to hear it. However, we are talking about the same honourable friend of the noble Baroness. He suggested a reform of mortgage relief—the words of the noble Baroness. That is not as I understand it, but I take the word of the noble Baroness. The Government have not proposed either reform or abandonment of mortgage relief. I do not believe—and this is very much an offhand remark—that as an idea it has very much to commend it to my honourable friend the Minister for Housing.

I refer back to the points made by the noble Baroness, Lady Nicol, as obviously I did not satisfy her when I spoke about pictures and profits; so perhaps I may have another attempt. The Government's amendments allow only housing associations to undertake shared ownership operations. Those are, of course, non-profit-making bodies. Therefore, profit in the way that, on reconsideration, the noble Baroness possibly meant it, does not arise in these cases.

Baroness Nicol

May I get this point clear? I accept the noble Lord's remarks about picture selling. After all, getting a house so that you can sell it eventually is part of the exercise. That is what shared ownership is all about. There is nothing wrong with that. My main concern is that the rent for the remainder of the property which is not being purchased is to be freed of control. Therefore, the rent could go beyond what one would at the moment expect a rent to be. Otherwise, why free it from control? I do not understand the need for that exercise.

Lord Skelmersdale

All rented property—in this case the rented parts of property—is covered by a lease which is entered into at the beginning of the letting period. So, again, I may be getting extremely dim at this time of night but I simply do not understand the point made by the noble Baroness.

Lord Dean of Beswick

My noble friend has put her finger on the button, and I shall put it another way. If one has this type of property, where part is rented and part purchased, are we not seeing two different sets of standards? My colleague indicated that the rent may go up, but is it not also a fact that at the same time persons in the other part of the building who are purchasing their part of the property could be receiving an increasing amount of money from mortgage rate relief? I have in mind that our responsible press recently have been preparing us for an increase in mortgage rates. The whole thing therefore becomes a hotch-potch.

The Minister was not strictly speaking to the amendment when quoting Mr. Meacher. One must be careful when speaking about what the Labour Party is going to do about mortgage rate relief. I believe the first person to float the idea in any document was His Royal Highness the Duke of Edinburgh in his report on housing. That quite clearly said that there is enough money in housing to deal with all the problems if someone would grasp the nettle and do away with mortgage rate relief and spread the money around.

If the Minister has had time to read Faith in the City he will have seen that that theme runs through that report. The Minister of State must have been sent the same document that I recently received from the Royal Institute of Chartered Surveyors which propagates the whole argument that it is time mortgage rate relief was done away with because people are receiving an unfair advantage. People are receiving substantial sums of money, and as house prices rise in the South-East it is a fact that more of the cake or money that is available for housing in general is going to the same people.

Lord Skelmersdale

Speaking from memory—and I would have to check the facts, as I suspect would the noble Lord, Lord Dean—I have a feeling that the ideas of his honourable friend who has been the subject of discussion actually predated Faith in the City. I shall not argue about it, but that is my impression. More seriously, I should make the point that the media, whatever speculation there may be in it, does not make government policy.

Baroness David

From what has been said, it is clear that we are not at all happy about this new clause. We shall have to look at it to see whether we can possibly amend it on Report. We do not like it.

Baroness Hoopermoved Amendment No. 90: After Clause 11, insert the following new clause:

("Extension of permitted objects of registered housing associations.

.—In section 4 of the Housing Associations Act 1985 (eligibility for registration), in subsection (3) (permissible additional purposes or objects of association), after paragraph (d) insert— (dd) providing services of any description for owners or occupiers of houses in arranging or carrying out works of maintenance, repair or improvement, or encouraging or facilitating the carrying out of such works;".).

The noble Baroness said: On behalf of my noble friend I should like to move this amendment and in so doing also address Amendment No. 312. The proposed new clause extends the category of permissible objects of registered housing associations to include the provision of agency services; that is, services designed to provide home owners or occupiers with practical help and encouragement with their home improvements or repairs. At present housing associations are able to provide such services only by setting up separately constituted bodies, which is clearly both restrictive and expensive.

The measure proposed will facilitate the provision of repair and improvement services to owners and occupiers and give effect to an undertaking in last year's Green Paper on home improvement policy. It will be for individual housing associations to decide whether to offer such services and if so how these should be financed. The Housing Corporation and the National Federation of Housing Associations have been consulted and are content, and I understand that there is widespread support from the voluntary sector. Amendment No. 312 is consequential to Amendment No. 90. I beg to move.

Baroness David

I think it is a pity that the noble Baroness, Lady Faithfull, is not here tonight. I see that the noble Baroness, Lady Elliot, is about to speak—I apologise.

Baroness Elliot of Harwood

I was about to intervene. I was not sure whether the noble Baroness wanted to speak. The noble Baroness, Lady Faithfull, unfortunately cannot be here, but she asked me whether I would tell the noble Lord that she would like to congratulate the Government on putting into this Bill help for elderly owner-occupiers. This means that registered housing associations can provide advice and assistance to elderly owner-occupiers whose properties are in need of improvement or repair.

The noble Baroness instanced the case of a lady, whom she herself visited, who was a widow of 80, living with her epileptic son of 40, in a property that had no inside lavatory, no bath and a poor kitchen. She was told that the son would have to go into a home. The housing association negotiated with an architect, a builder and the planning authority, and as a result she has an inside lavatory next door to her son's bedroom on the ground floor, a shower and a new kitchen. She would never have achieved that on her own—and she has the money to pay for this work. The local registered housing association conducted all the negotiations for her and now her son can stay with her.

The "Stay Put" scheme means that many more people can stay in their own home and the Government should be strongly congratulated on this. I deliver this message. I agree with it entirely, but it is on behalf of the noble Baroness, Lady Faithfull, that I am speaking.

Baroness David

I, too, welcome this measure. I do not know how much pressure the noble Baroness, Lady Faithfull, brought to bear on the Government in order to bring it forward but, however it got here, I think it is very satisfactory that it is here and we welcome it.

Lord Skelmersdalemoved Amendment No. 89: After Clause 11, insert the following new clause:

("Disposal of dwellings in new towns.

—(1) Part III of the New Towns Act 1981 (transfer of new town housing to district council(s) is amended as follows.

(2) After section 57 insert— Savings for other powers of disposals. 57A. The provisions of this Part as to the transfer of dwellings in a new town to a district council shall not be construed as restricting—

1. (a) the power of the Commission under section 36 above,
2. (b) the power of a development corporation under section 64 below, or
3. (c) the power of the Development Board for Rural Wales under section 4 of the Development of Rural Wales Act 1976,

to dispose of such dwellings to any person.".

(3) The following provisions (which relate to the initiation of consultations with a view to the transfer of new town housing to a district council) are repealed—

• section 43(3) and (4),
• section 49(b) and (c).").

The noble Lord said: Just to confuse the issue, I beg to move Amendment No. 89 and in so doing—perhaps I had better not. I was going to say in so doing perhaps I may be allowed to comment on the noble Baroness's amendment to that amendment, which is No. 88 on the Marshalled List.

Baroness David

I have not moved it yet.

Lord Skelmersdale

That is why I said on second thoughts perhaps I had better not. Amendment No. 89 clarifies the position with regard to the transfer of new town dwellings to bodies other than local authorities. On 25th March this year, my noble friend Lord Elton, in a Written Answer to my noble friend Lady Gardner of Parkes, announced that the Government were prepared to consider proposals from new town corporations for the transfer of their housing to bodies other than local authorities. We wish to ensure that the choice between a local authority and a non-local authority option for the remaining new town housing is not restricted by any provisions in the legislation concerning statutory transfer to the local authority.

The new clause therefore introduces a new section into Part III of the New Towns Act 1981 which declares that nothing in Part III shall be construed as restricting specified powers of new town bodies to dispose of new town dwellings to any person. The new clause also repeals certain provisions in Part III regarding consultation prior to a transfer scheme.

The effect of the amendment is to leave the option of a Part III transfer completely open in each town but to set beside it the option of a disposal of a new town's dwellings to other bodies. As my noble friend Lord Elton indicated in his Written Answer, in each case where we are considering proposals for transfer of a new town's housing to permanent owners other than the council, we will take the views of the tenants, the local authority, the new town's housing staff and other interested parties carefully into account before any final decision is reached. I beg to move.

9.30 p.m.

Baroness Davidmoved, as an amendment to Amendment No. 89, Amendment No. 88: Line 15, after ("person") insert— ("Provided always that if a district council is willing to enter into a scheme under this Part of this Act no such disposal shall take place contrary to the wishes of the majority of the tenants of such dwellings in the district voting in a secret ballot conducted by the electoral returning officer appointed for district council elections under section 35(1) of the Representation of the People Act 1983. ( ) For the purposes of a ballot under subsection (1) above the tenants shall be offered the alternative of transfer of their dwellings to the district council and the underlying financial terms and conditions of disposal to the district council shall not be less favourable taken as a whole than are available to the prospective alternative transferee. ( ) Where dwellings which are managed by the district council as agent for the Commission, a development corporation or the Development Board of Rural Wales, are disposed of under the powers mentioned in subsection (1) above, then such district council shall be indemnified by the owner against all financial loss incurred as a result of the establishment or termination of such management agency.").

The noble Baroness said: We are still back to front. I think the trouble was that these amendments were printed the wrong way round in the first Marshalled List and they have at least now been arranged so that, although the numbers are the wrong way round, the amendments are printed the right way round.

This is a probing amendment and there is no intention of pressing it tonight. But we are suspicious of this new clause put down very recently, and we should like to know far more of the Government's intentions and the reasons for such a change in policy. One can only presume that the Government are more and more anxious to divest local authorities of their housing responsibilities.

The background to all this as far as I can see is that until the central Lancashire new town housing transfer, all previous transfers of new town housing had been to the appropriate district councils. In the case of central Lancashire, the position was rather different, for several reasons. Three local authorities were involved, rather than a single district council, and the development corporation there had made extensive use of housing associations in its housing work. The three local authorities concerned all stated that they did not want to take over the houses. As a result, the development corporation there conducted a tenant ballot.

The general view is that the accompanying literature was exceptionally brief and was biased against the three local authorities. Only 50 per cent. of the tenants took part, but of these nearly 80 per cent. opted for housing associations. In the circumstances, given that the three local authorities had declared their position publicly, the outcome was not altogether surprising.

Since the central Lancashire transfer, the idea of a transfer to a landlord other than the district council has been developing within the Government. It is in line with their general ideology. Does the Minister have the legal powers to transfer to people other than the district councils? I guess that the Government were not certain that they had those powers and that was the reason for this amendment. I do not know whether the Minister is willing to enlighten us on that.

The effect of the amendment which the Minister has just moved would enable the new towns commission to take over or manage property, including dwellings, previously vested in the development corporation and to transfer them to any person—this is the important thing—notwithstanding the other provisions of the New Towns Act 1981 relating to transfer schemes.

While this would give the Minister the powers to transfer corporation houses to a housing association, as in central Lancashire, or to a community trust, as with Thamesmead when the GLC was abolished, it also opens up the possibility of disposal to private landlords or anyone else.

The amendment will also repeal the current power of the development corporation and district councils to request the Secretary of State to enter into consultation with a view to agreeing a transfer scheme. In other words, sole responsibility for the decisions on whether to pursue housing transfer to a district council will rest with the Minister. We feel this must be opposed.

It is known that Ministers are keen to base their decision on the result of a ballot of tenants in each new town where the transfer of houses has yet to take place. It is understood that Ministers wish local authorities to be bound by the results, but have not been prepared to give a similar undertaking themselves. Will the Minister please give that undertaking to us tonight? Will Ministers be bound by the result of a ballot?

It is understood that a substantial write-off of capital debt is proposed to make the transfer to housing associations viable. Any choice offered to tenants should be both equal and fair. We want to know if there will be a write-off of capital debt if the houses are disposed of to any other body, because district councils have not had that benefit.

Depending upon the result of such ballots, it is the Government's intention to transfer corporation houses to landlords other than district councils in new towns where housing management agencies have already been established, such as Peterborough and Milton Keynes, in anticipation of housing transfers. The Association of District Councils has proposed this amendment to meet all those concerns.

There are other considerations with regard to staff. I mentioned the arrangement which had been made in Peterborough and Milton Keynes. The district council is already the managing agent there, so to speak. When it took on that responsibility it gave guarantees to its staff that they would have safe employment. When that arrangement was made in Peterborough, all contracts of employment were terminated on 30th September, 1984 for the district council housing staff and the development corporation staff. New contracts were given on 1st October, 1984. The staff had to trust that that was a lasting contract.

Peterborough District Council absorbed some 70 people from the development corporation. That was a difficult process. When the suggestion was made that the houses could be transferred to any person, there was a good deal of anxiety about what would happen to the staff. We are anxious to have a reply on that matter.

The district councils have already been involved in a good deal of expense. When they set up this new arrangement, large computers, and so on, had to be bought. Will there be any compensation for the expense that those two district councils, in particular, incurred when they took on that responsibility? There is a great deal of anxiety about what is going to happen. When the Minister replies, we want a number of assurances as to the future. As I said, this is only a probing amendment, but if we do not receive satisfactory answers, we shall need to do something more on Report. We feel that the Government had this idea but had not really thought through all the complications which would follow. I beg to move.

Baroness Stedman

I am completely ambivalent at the moment about both the amendment and the amendment to it. It was always understood during my time on the Peterborough development corporation in its early days that rented accommodation would come back eventually to the district council and that any benefits would accrue to the city and citizens in general. That was always understood. That was why the arrangement was entered into a couple of years ago, as the noble Baroness has described. I am concerned about the phrase "any person". I would prefer to see houses handed back to district councils to manage. They have set up machinery for managing their own stock and that of the development corporations. On the other hand, I would not be completely against some of them being taken over by housing associations in a proper set-up. I would be concerned if they were to be sold off in batches to private landlords for letting without any certainty that they would remain as houses to rent.

There is a problem. Like the noble Baroness, I should like to be satisfied as to what is happening to the capital deficit that remains on the houses that have been built. Will it be written off altogether to the district council and whoever buys them? What sort of arrangements will be made for the staff, the equipment and the expense to which the district council has been put? I understand from my local press that the district council sent a deputation to the department. I have not seen any reference since to what happened on that visit. I wonder whether the Minister is able to say tonight that he was able to satisfy Peterborough, which was joined by Milton Keynes in the deputation, and to say how far the proceedings have gone.

Lord Skelmersdale

Not all local authorities want to take new town housing. Halton borough council recently reaffirmed, having been asked, I think I am right in saying, three times—that is subject to confirmation—that it wants nothing to do with the housing at Runcorn. So this is not an open and shut case. I can sympathise to a certain extent with the spirit of the first part of the amendment. My intention is that there would, in practice, be an opportunity for the council and non-council option to be put to the tenants and to other interested groups wherever that option arises, as it may do in as many as five of the six new towns concerned. I remain to be convinced that the climate for such consultation would be better if conducted against a rigid statutory framework. I foresee difficulties arising if the transfer of dwellings is to be determined by a single ballot confined to tenants, for example, if there was a low turnout. It would also be right to give some weight to the views of other interested parties such as the staff and owner-occupiers on new town estates, as I said when moving my original amendment. The noble Baroness, Lady David, asked whether we would be bound by the result of the ballot. The answer is no. We have said, however, that the views of the tenants, of the local authorities and of the housing staff and other interested parties, will be taken into account before deciding where housing is to be transferred.

The first part of Amendment No. 88 perpetuates the presumption that the transfer of new town housing to the local authority is the natural course of events, always supposing that the council sees fit to accept the housing. I come back to the introductory remark I made to the noble Baroness, Lady Stedman. This presumption is no longer appropriate at a time when we are seeking diversification of ownership and management of existing public sector rented housing. The subject of exactly what a person meant came up on Tuesday. I regret that I was unable to answer properly then except to say that it was defined in the Interpretation Act 1978. I now have the Act with me. I can tell the Committee that "person" includes a body of persons corporate or unincorporate.

It was first used—my noble friend is not here—in 1889. I would much prefer to folllow a non-statutory course in the new towns context. This could be most conducive to achieving what the Government, local authorities and new town corporations themselves should all want—the best arrangements in each town from the tenants' point of view. I am meeting representatives of local authorities next week. I suggest to the Committee that it would be a mistake to preempt those discussions.

Amendment No. 88 raises two other points. First, it reflects the concern of the councils for the new towns in question that there should be some sense of equality of financial treatment for all prospective transferees of new town housing. This is a concept which might well raise practical problems if it is fixed in a statutory form. I can assure the Committee that our aim is to put all transferees of new town housing in a position to manage the houses properly without any undue financial burden and without making undue profits.

In this connection, the noble Baroness, Lady David, asked me about the capital debt provision. Local authorities taking new town housing would inherit both the debt and the subsidy to go with it. A housing association would not take the debt and would not get the subsidy. In that case, any debt not covered by the sale proceeds would probably have to be written off. I hope that answer helps the noble Baroness.

The noble Baroness, Lady Stedman, with her experience in the early days of Peterborough new town, asked, not surprisingly, about the position in Peterborough today. It is now for the development corporation, I am advised, to decide what alternative there is to a local authority for the transfer of the houses. They will have to go out to consultation on this matter. It is certainly possible that the non-local authority option will involve housing associations, and I am glad that the noble Baroness welcomes that. But at this immediate moment I am not able to say what option will eventuate.

The noble Baroness also mentioned a joint deputation from the new town local authorities. There has not been one, although, as I said earlier, I am seeing the ADC new towns' committee next week. I therefore hope to be more positive in understanding their views after that meeting.

Last but not least, the amendment raises the matter of agency arrangements. There are two new towns—Peterborough and Milton Keynes—where the new town housing is managed for the development corporations by the local authority. These agreements were entered into voluntarily and non-statutorily. The presumption must therefore be that if necessary they can be satisfactorily and equitably terminated without recourse to legislation whch is provided for in the second leg of the noble Baroness's amendment to my amendment. The Committee will see that there are good reasons for my not agreeing to the amendment of the noble Baroness.

Lord Underhill

Perhaps I may briefly intervene on two points. In its first words, my noble friend's amendment says: provided always that if a district council is willing to enter into a scheme". That is a very important provision.

In the light of what the Minister has said, can he give an undertaking that "any person" will not include a private landlord? He cannot. Therefore the fears of my noble friend are justified. He could be a private landlord. That is something that Members of the Committee do not want to see happening.

Lord Skelmersdale

Is the noble Lord referring to any occasion, even on the example that I quoted? There are local authorities who specifically do not want new town housing. There are occasions when it would not be appropriate to give it to housing associations. Is the the noble Lord saying that we come into a glass-case situation and that the housing has to remain with the new town? Surely that cannot be right.

Lord Dean of Beswick

Is it the Government's intention to dispose of all new town housing in one way or another as quickly as they possibly can? If so, what will happen to the Runcorns of this country which no local authority wants? How long will they remain as new town houses?

Lord Skelmersdale

I have taken up my responsibility for new towns only in the past three weeks. I have not yet visited any of them. I certainly intend to do so. I can tell the noble Lord that there has been a policy for a number of years to wind up new towns. If I knew my brief as well as I ought, I should be able to rattle off the names of the new towns, and the agreement that has been reached with them on the date by which to wind up. I know that it is an ongoing process and that some of them have not yet been settled. However, ultimately the new towns will be wound up.

9.45 p.m.

Lord Dean of Beswick

I am grateful to the Minister. Without naming any new towns, the point I am trying to make is that all the new towns have not been a success sociologically. As the Minister said, some of them are new towns, but in certain parts of the country, they are very high problem areas. On that basis does anybody expect a local authority, with all the troubles and the shortage of finance they have, to want a new town unloaded on it? I think the Minister knows which new towns I am talking about.

Lord Skelmersdale

Bearing the name that I do, I can guess one of them! To be serious, I should have thought that in certain circumstances, that was an argument for allowing new town housing to go into the private sector which has access to money and all sorts of ways to improve properties and make them more rentable than we are often told from the other side of the Committee, with the so-called restrictions on local authority housing expenditure, would be possible for the local authorities. Therefore, if I may respectfully say so to the noble Lord, it is an argument that cuts both ways.

Lord Dean of Beswick

I do not want to continue this discourse much longer, but when we are talking about financing some of these new towns and about housing, I suspect that these could be 50 per cent. or more of the tenants in new town houses on social security, and some, either fully or in part, will not be able to pay the debt. What is the answer to that in the terms of who will want to take those over or who will bear the bill for that?

Baroness Stedman

May I give the Minister just one piece of advice before he meets the district councils concerned with the new towns. I do not want to teach my grandmother to suck eggs or anything like that, but I was on the county council in Huntingdon and Peterborough when we were asked to become one of the partnership authorities in the new town. I think one of the reasons for the success of the Peterborough new town has been its close association throughout the last 16 or 17 years with the city council or the county council. That is one of the reasons why it works so well, and has been one of the success stories that we are very proud to boast about.

However, I also remember when the late Lord Greenwood came to try to sell us the idea of having a new town in Peterborough. The Committee will accept we were then a town of some 60,000 and felt we were sufficiently established in our own right and that we did not need all these other people. We took some convincing that we needed a new town expansion or that we ought to have it. One of the carrots held out on that occasion—even though it may be, as the noble Lord now says, an assumption—was that one day all these wonderful things that were being done would revert to the city council and would be to the profit and to the benefit of the city, and the citizens as a whole. That was one of the points that encouraged us and encouraged the local authorities to go into partnership with the Government in the new towns.

As I said, I am not averse to some of the new towns being sold off to housing associations. I am anxious to see a respectable sized pool of housing to rent. I am not wedded to the idea that all the rented accommodation that is available should be city council housing. I am perfectly happy to see a pluralism of rented accommodation. But I ask the Minister to bear in mind that one of the carrots that was handed out initially was that these things would come back to the benefit of the city.

Lord Skelmersdale

I take that point, but the noble Baroness should remind the Committee of the date and the Government at the time who set up the new town. Policies, whether politically or logically based, change over time. That is one of the reasons, but only one of the reasons, why one government on any occasion cannot bind their successor. However, I take very much to heart the point that the noble Baroness has made.

Baroness Stedman

It will not make the noble Lord's meeting any easier if he takes away what they were promised in the first place.

Lord Skelmersdale

Indeed.

Baroness David

Perhaps I may clear up the question of the write-off of the capital debt. It seems to me to be very unfair that if the houses are taken over by the district council, it will have to carry on and take over the debt, but that if, as I understood the Minister to say, they are handed over to some other person or housing association, the debt may well be written off. That seems to be incredibly unfair.

Lord Skelmersdale

I believe that it was the noble Baroness, Lady Stedman, who earlier in this short debate spoke effectively about carrots and sticks. In answer to the noble Baroness, Lady David, the first time round I said that if the new town housing went to the local authorities, the local authorities would inherit both the debt and the subsidy to go with it—the carrot and stick, if you like. A housing association would get neither. Therefore, there is an equality there.

Baroness David

I think that that depends a little on the sums, does it not? This has been an extremely useful discussion and it has clarified a certain number of matters. I believe the Minister said that next week he was seeing people from the new towns. Therefore, that meeting will have taken place by the time we come to the Report stage of this Bill. We hope that information will reach us well before the date of the Report stage, so that, if we need to put down amendments to the new clause which the Minister has moved, we shall be able to do so. I believe that much thought will have to take place between now and then, as well as much consultation. I beg leave to withdraw the amendment.

Amendment to Amendment No. 89, by leave, withdrawn.

Lord Skelmersdalemoved Amendment No. 86: After Clause 11, insert the following new clause:

("Effect of resolutions relating to housing action area or general improvement area.

.—(1) In Part VIII of the Housing Act 1985 (area improvement) before section 260, under the heading "Supplementary provisions" insert— Effect of resolutions relating to housing action area or general improvement area. 259A.—(1) A resolution of a local housing authority passed after the commencement of this section—

1. (a) declaring an area to be a housing action area, excluding land from a housing action area or declaring that an area shall cease to be a housing action area, or
2. (b) declaring an area to be a general improvement area, excluding land from a general improvement area or declaring that an area shall cease to be a general improvement area,

has effect, subject to subsection (2), from the day on which the resolution is passed.

(2) A resolution declaring an area to be a general improvement area may be expressed to have effect from a future date, not later than four weeks after the passing of the resolution, on which the whole or part of that area will cease to be, or be included in, a housing action area. Effect of certain resolutions passed before commencement of s. 259A. 259B.—(1) Where before the commencement of section 259A a local housing authority passed a resolution of any of the descriptions mentioned in the section expressed to have effect from a date after that on which it was passed—

1. (a) anything done before the commencement of this section in reliance on the view that the resolution was invalid shall have effect as if the resolution had not been passed, but
2. (b) otherwise, the resolution shall be taken for all purposes, both before and after the commencement of this section, to have been validly passed and to have had effect from the date on which it was expressed to have had effect;

subject to the following provisions. (2) A person shall not be proceeded against in respect of anything done or omitted before the commencement of this section which would not have been an offence if the resolution had not been passed. (3) Where the resolution declared a housing action area or general improvement area and, before the commencement of this section, the local housing authority passed a further resolution making the like declaration in relation to the whole or part of the area to which the first resolution then related—

1. (a) both resolutions are effective, notwithstanding that they relate in whole or in part to the same area;
2. (b) the area covered by both resolutions is a housing action area or general improvement area by virtue of the joint effect of the two resolutions, and in the case of a housing action area shall continue to be such an area (subject to the provisions of this Part) until the end of the period of five years beginning with the date on which the second resolution was passed;
3. (c) it is immaterial whether steps taken before the commencement of this section were taken in reliance on the first resolution or the second, but steps taken in reliance on the first shall not be proceeded with to the extent that they have been superseded by, or are inconsistent with, steps taken in reliance on the second; and
4. (d) the areas declared by the two resolutions may be treated as one for the purposes of section 245(3) or 259(3) (limit on aggregate expenditure qualifying for contributions by Secretary of State).

(4) The provisions of subsection (3) do not affect the powers of the Secretary of State under section 241(2)(a) and (b) (power to overrule declaration of housing action area or exclude land from area) and, so far as they relate to the duration of a housing action area, have effect subject to section 241(4) (effect of Secretary of State's decision in such a case).". (2) In consequence of the above amendment, Part VIII of the Housing Act 1985 is further amended as follows—

1. (a) in section 239(4) (duration of housing action area), omit "beginning with the date on which the resolution is passed";
2. (b) in section 240(1) (steps to be taken after declaration of housing action area), omit "passing a resolution";
3. (c) in section 242(2) (incorporation into housing action area of land comprised in general improvement area), for "the resolution is passed declaring such an area" substitute "the area is declared";
4. (d) in section 250(1) (exclusion of land from, or termination of, housing action area), omit "on the date on which the resolution is passed";
5. (e) in section 257 (duty to publish information) for "have declared" substitute "have passed a resolution declaring" and for "assistance available" substitute "assistance which is or will be available";
6. (f) in section 258(1)(b) (resolution terminating general improvement area), for "an area to be no longer" substitute "that an area shall cease to be";
7. (g) in section 258(2) (effect of resolution excluding land from or terminating general improvement area) for "the date on which the resolution takes effect" substitute "the date on which the exclusion or cessation takes effect" and for "the exclusion or cessation" substitute "the resolution".").

The noble Lord said: For once I think that this is an amendment which stands on its own. It is to deal with a problem which has arisen in connection with incorrectly declared housing action areas and general improvement areas. In the Government's view some declarations by local housing authorities are not valid because they purport to declare an area to come into effect at some future date. Our legal advice is that declarations may only be expressed to come into effect immediately.

The first part of the amendment introduces a new clause into the Housing Act 1985 which makes it quite clear that all resolutions declaring an area, terminating an area or excluding land from one have effect from the day on which they are passed. However, it also makes an exception where an authority declares a general improvement area at the expiry of a housing action area. It is for the most part in this circumstance that authorities have made deferred declarations resolving that the general improvement area should start on the expiry of the housing action area. This seems reasonable as it avoids the authority having to have a special meeting on the expiry day so long as the deferment is not too long. The new clause allows deferment for up to four weeks and should ensure that the problem does not recur in the future.

The second part of the amendment validates retrospectively the deferred declarations which have already been made. The clause's "book effect", if I may call it that, is that on commencement the declarations and anything done under them will be deemed to be valid. Various consequential provisions are made, but, as they are consequential, unless any Member of the Committee has particular questions on them, I beg to move.

Lord Mottistone

Which amendment are we talking about?

Lord Skelmersdale

The new clause, Amendment No. 86 on the Marshalled List.

Baroness David

This was one of the amendments that was put down rather late. We shall have to read what the Minister has said. If we are not satisfied with the amendment, or the explanation, we shall have to come back at the next stage. I am sorry, but my comments would not be very satisfactory at this moment.

Lord Skelmersdalemoved Amendment No. 87: After Clause 11, insert the following new clause:

("Agreements with certain housing bodies exempt from Consumer Credit Act 1974.

.—(1) Section 16 of the Consumer Credit Act 1974 (exempt agreements) is amended as follows.

(2) In subsection (1) (which enables orders to be made exempting agreements with certain descriptions of creditor), after paragraph (f) insert— (ff) a body corporate named or specifically referred to in an order made under— section 156(4), 444(1) or 447(2)(a) of the Housing Act 1985, section 2 of the Home Purchase Assistance and Housing Corporation Guarantee Act 1978 or section 31 of the Tenants' Rights, &c. (Scotland) Act 1980, or Article 154(1)(a) or 156AA of the Housing (Northern Ireland) Order 1981 or Article 10(6A) of the Housing (Northern Ireland) Order 1983; or"; and in subsection (3) (requirements as to consultation), in paragraph (d) (consultation with responsible Minister), for "or (f)" substitute", (f) or (ff)".

(3) After subsection (6) insert— (6A) This Act does not regulate a consumer credit agreement where the creditor is a housing authority and the agreement is secured by a land mortgage of a dwelling. (6B) In subsection (6A) "housing authority" means—

1. (a) as regards England and Wales, an authority or body within section 80(1) of the Housing Act 1985 (the landlord condition for secure tenancies), other than a housing association or a housing trust which is a charity;
2. (b) as regards Scotland, a development corporation established under an order made, or having effect as if made, under the New Towns (Scotland) Act 1968, the Scottish Special Housing Association or the Housing Corporation;
3. (c) as regards Northern Ireland, the Northern Ireland Housing Executive.".

(4) The above amendments apply to agreements made after the commencement of this section.").

The noble Lord said: I am so confused that I am not sure whether this is the first time we are actually progressing rather than regressing in the list of amendments. But we certainly are progressing since the last one was Amendment No. 86 and this is 87. I beg to move Amendment No. 87, and I shall speak also to Amendment No. 319.

This amendment has to do with mortgages. The Consumer Credit Act 1974 provides protection for people who enter into credit transactions. Arranging a mortgage loan is a credit transaction, but the Act recognises that its provisions may not always be appropriate for this type of lending. To take just one example, people wanting a mortgage may not be very pleased if they are told that they must wait for their advance until a statutory cooling-off period has expired. The Act therefore allows for certain mortgage lending to be exempted. In general, such lending by building societies and local authorities is, at present, exempted automatically; and there is scope for the mortgage lending of other bodies to be exempted by order.

These days we all know that building societies no longer have a monopoly of mortgage lending, and their competitors have a right to expect that they can compete on equal terms. The Government have always recognised this, and a number of mortgage companies have applied for, and been granted, exemption orders. In February of this year, however, the Joint Committee on Statutory Instruments took the view, in its eleventh report, that the basis on which one of these orders had been made was erroneous. This opinion also cast doubt on the validity of several earlier orders. A number of companies and other bodies who believed that they were exempt from the Act had to be informed that there was doubt about their exemption.

The new clause allows mortgage lenders to dispense with the detailed procedures under the Consumer Credit Act by means of exemption orders to be made in respect of mortgage lenders who have been named in certain negative orders, all of which are concerned with mortgage lending. It also exempts automatically mortgage lending secured on a dwelling by housing authorities, including new town corporations, urban development corporations. the Development Board for Rural Wales, and the Housing Corporation.

All these bodies give voluntary loans and also have a duty to lend for right-to-buy purchases and will in future also have to give loans for service charges. This new clause will remove any doubt whether such loans are regulated by the Consumer Credit Act. The provisions are not retrospective. Amendment No. 319 is a consequential amendment to Clause 41. I beg to move.

Baroness David

Thanks to the kind of Alice in Wonderland situation in which we seem to have got ourselves, jumping backwards and forwards in the numbers and trying to find one's place both in the Marshalled List and in one's notes, I am not able to comment at this moment on this amendment either. I shall reserve the right, if necessary, to bring forward amendments at the next stage.

10 p.m.

Lord Dean of Beswickmoved Amendment No. 93: After Clause 11, insert the following new clause—:

("Duty to provide financial assistance for tenants organisations

.—After section 105 of the Housing Act 1985 insert— 105A.—(1) A landlord shall upon receiving written notice from any registered tenants organisation representing secure tenants in its area provide financial assistance from its Housing Revenue Account for the purpose of housing management. (2) The amount of grant payable to each tenants organisation is an amount to be prescribed in regulations calculated on a weekly basis by reference to the number of dwellings occupied by its members in the area of that tenants organisation. (3) Regulations under this section shall—

1. (a) prescribe the minimum amount per dwelling to be provided in each grant;
2. (b) determine the criteria by which the landlord authority shall—

1. (i) distribute the grant, and
2. (ii) register tenants organisations in its area.

(4) Regulations made under this section shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament. (5) Payments under this section shall be prescribed expenditure for the purposes of section 421(1) of the Housing Act 1985. 105B.—Section 105A shall come into operation on such day as the Secretary of State may by order appoint. (2) Different days may be appointed under this section for the coming into force of section 105A above in different areas."")

The noble Lord said: It is getting late in the evening but I think the Committee will agree that the subject that this particular amendment deals with is perhaps one of the kernels of the question of good housing management in the future. It calls for a duty to provide financial assistance for tenants' organisations. One of the major obstacles to improving the quality of public sector housing is the absence of adequately resourced, effective tenants' movements able to ensure that the principal interest governing the policy, financing and management of council housing, is that of tenants. Experience strongly suggests that the most effective tenant organisations are those that have paid worker support and are in receipt of sufficient funding to help run their administration and activities. Without such assistance, the sheer scale of the task facing many tenants' associations is too great.

Accordingly, the National Consumer Council and the National Association for the Care of Offenders and the Prevention of Crime have sponsored two working groups with representation from a wide range of agencies to examine various options for resourcing and supporting tenants' organisations.

The NCC has been involved with tenants' rights over a number of years and NACRO's interest stems from its well-established work on housing estates and the belief that reductions in crime problems will come about only if improvements are made in line with tenants' wishes. Few would disagree that council housing is in a deepening crisis. One of the most important and deep-seated reasons for this is that tenants have no control over the management of their housing. Local authorities treat their tenants in the main as dependants, and they are in some respect powerless in the hands of the monopoly supplier, rather than customers on the receiving end of a service.

Both the report of the Duke of Edinburgh's inquiry into housing and the Audit Commission's report on housing management called for a greater role for tenants in the management of rented housing. The Audit Commission said: It is the view of many authorities and the Commission that a high level of tenant involvement is essential if local authority housing services are to deliver the type and quality of housing which tenants really want".

At a recent conference on Tenant Management Cooperatives, and in the Report stage debate on the Housing and Planning Bill in the House of Commons, the Minister, Mr. John Patten, emphasised the need for well-organised tenants' groups. He said: I agree that local authorities should promote, encourage and support representative tenants' associations. Consultation and tenant involvement in management can only be effective where there are active tenants' associations".

The Housing Act 1980, Section 43, created the right for local authority tenants to be consulted on matters of housing management. This is now enacted in Section 105 of the Housing Act 1985. The importance of consultation is not in doubt and has been stressed in discussions during the Commons Committee stage of this Bill and recently in the debate, especially in relation to Clauses 5 and 6. Local authorities are under a statutory obligation as landlords to consult their tenants. This obligation can be easier to meet when tenants are properly organised. It is central to the experience of the Priority Estates Project in England and Wales and the Tenants' Participation Advisory Service in Scotland that tenants must be closely involved in the process of housing management if it is to be successful and effective.

For tenants to be involved and to exercise some measure of control, thereby enforcing higher standards of management, they need to be properly organised and in receipt of funding that is secure, independent and set at a level adequate to do the task.

It follows therefore that properly resourced and organised tenants' associations are a precondition of good housing management. As the Minister, Mr. John Patten, said, We know, that for such organisations reasonable funding can make all the difference".

It is not enough that local authorities can provide financial assistance to tenants' organisations. In view of the deepening crisis in housing and the critical role of tenants and their associations, local authorities, we believe, must be placed now under an obligation to provide these essential resources. Even though local authorities already have general powers and discretion to make payments to local groups, many local authorities either do not choose to do so or only pay small amounts on a "one-off" basis.

It is for these reasons that there is a need for a minimum level of payment as of right, to be paid on a weekly basis for as long as the tenants' associations do have a vital role to play in ensuring that proper consultation and involvement of tenants in housing management actually take place. We believe therefore that it is for central government to initiate action and take responsibility for ensuring that adequate funds are made available at local level to perform this task.

Against the background of the crisis in housing, and given the consensus that exists about the importance of the role of tenants in housing management, we believe that now is the time to ensure that proper funding is made available. We accept the comments that have been made during the debate and the Committee stage of the Bill in the other place and we have accordingly amended our original clause.

This new clause is designed to establish the principle of mandatory funding at a mimimum level for tenants where tenants' organisations exist. It is recognised that there is a need for the exact details of the funding to be determined at local level. Therefore the new clause only specifies the minimum requirement to ensure that funding is provided to all properly constituted tenants' organisations by way of a right which could be enforced if necessary.

We accept that there are many constraints on local authority resources. However, there is the opportunity for assessment to be made of the balance of income and expenditure each year. If found necessary, it is always possible for the rent to be raised by the approximately 7.5p per week which is necessary to cover the cost of funding tenants' organisations. As this is prescribed expenditure, it would be eligible for central government subsidy.

We recognise that there is a need to ensure that tenants have an incentive to become organised and properly represented, and for this reason. It is proposed that only properly constituted tenants' organisations would be eligible for funding from their local authorities on a capitation basis, according to the size of their signed-up membership. This would mean that a proper membership base would have to be established and would create an incentive for tenants to develop their membership and to be accountable to their members.

This approach would mean that tenants' organisations would not be able to draw an arbitrary circle around an estate or area and claim funding on the basis of a theoretical membership of all the tenants in that area, whether or not those tenants wished to be members.

In response to the comment that "all tenants would pay for grants but only those belonging to tenants' associations would get any benefit", it should be remembered that all tenants already pay their rent into a housing revenue account, which has to pay for many services, some of which are only provided to certain groups of tenants rather than to everyone. Moreover, if tenants' organisations only develop on a small scale, the impact on the housing revenue account of the provision of their funding would be absolutely negligible. The criticism that tenants "would be paying for something they did not receive" cannot be justified.

If tenants' organisations develop well across the whole of the local authority area, the cost would indeed have to be borne by all tenants, regardless of whether or not they were members of such organisations, but all tenants would benefit from the improved management and service delivery which would inevitably result from such a development. I beg to move.

Lord Mottistone

I belong to a tenants' association. I believe that the noble Lord, Lord Dean, may belong to it as well. It is called the Dolphin Square Tenants' Association. I have one question concerning this amendment. It refers to local authority landlords and, as I see it, even without referring to the Housing Act 1985, I should have thought that any landlord might well find himself under the terms of Section 105A, and would therefore be required, even in Dolphin Square which is a housing trust, to finance the tenants' association. I should hope that would not be so, but it might, and perhaps the wording could be improved if it were restricted only to local authorities.

However, the point about this amendment is that I respect my tenants' association because it is funded by the tenants. It is not funded by the landlord and I suspect that people in a council housing estate might say that they would not put up the money or pay their pound a year, because they would expect someone else to do it for them. When it came to the point they might not respect their tenants' association if it was being funded by the landlord. While I entirely agree that tenants' associations should be encouraged—since I have knowledge through younger friends of how appalling some administration of local authority housing estates can be—I should have thought that to have a tenants' association funded by the landlord means that it is funded by the last person to give the respect due to tenants' associations. I am only suggesting to the noble Lord that, although his idea is excellent, the principle of subsection (1) is disastrous. Can it not be done another way?

Lord Dean of Beswick

I think the fact that NACRO and other such bodies are vitally interested in this indicates that a lot of the areas we are speaking about, where tenants' associations are required and need to be funded by the local authority, are the problem areas. I accept the premise on which the noble Lord, Lord Mottistone, has made his contribution but I think there is a slight difference between Dolphin Square and its tenants' association and the type of area we are speaking about here. The areas are quite dissimilar.

I think that these associations must be encouraged, and we are suggesting that it could be done quickly. I would not think myself, with all the good will in the world, that you would be able to raise the funds among council housing tenants. In these types of areas, which are large council estates in the main, someone must take the initiative and create a situation where these associations can develop. In my view, landlords are the only people who could do this and who may have the funds to do it. It would cost a minimal amount, on a council house weekly rent, to do it. In the interests of organising the estate on behalf of the tenants themselves and encouraging them to be involved, I should think that it would be a worthwhile exercise which may save money in other respects.

10.15 p.m.

Baroness Stedman

I should like to support this amendment. In putting my name down to support it, I was clear in my own mind that it referred to council tenants and not to tenants of Dolphin Square, though I am delighted that there is an independent residents' association there—and more power to its elbow and to other organisations like it!

Today, the trend is a lot more towards co-operation and participation and the Government keep on telling us about participation and consultation at all levels. But there is still a feeling on many of our council housing estates among the tenants that they have no control over the management of their housing. They are beginning to feel that they ought to be treated rather more as customers of the local authorities and not have quite so much dependence on them.

Since local authorities have a statutory duty to consult their tenants, I should have thought it would have been better for them to take some part in the formation of tenants' associations and to make their own life easier. That could be done if, as noble Lords said, they were under an obligation to provide the essential resources for a tenants' association and this Bill is the place where we could provide for the funding to take place. As he said, it would be prescribed expenditure and therefore there could be a government subsidy on it. If the properly constituted tenants' associations develop only slowly, as they well may in the early stages, and on a very small scale, there would be only a negligible impact on the housing revenue account for their funding.

I think that in Scotland they have been much more progressive—there are not many Scottish Peers here to cheer—with the tenants' association. The concept of it is accepted and there are now something like 1,000 tenants' groups in Scotland, which give the housing authorities a regular point of contact, a regular source of feedback about tenants' views, suggestions and what they consider are their priorities. It also provides a point and a means for the authority to consult the tenants about their policies and proposals and to communicate to them news that is relevant to them and their estates.

There is a movement towards tenants' associations in this country—it is not as strong as it is in Scotland—and they need some funding to get off the ground. But it could be money well spent in the long term and the amendment has spelt out carefully how these associations could be set up, how they could be funded and how they would operate to make sure that they are not taken advantage of. I hope that the Government will consider this amendment sympathetically.

Baroness Hooper

It is my understanding that the proposed amendment would apply only to secure tenants' associations; in other words, to public sector tenants. In placing a duty on local authorities to provide financial assistance for tenants' organisations, we recognise that to such organisations a small amount of money can make a lot of difference. However, many local and voluntary organisations would like a little extra financial help and as the Committee will be well aware, local authorities do not have a bottomless purse.

But as the noble Lord acknowledged, they already have general powers and discretion to make payments to local groups to facilitate the discharge of any of their functions in their areas, and these discretionary powers which have been referred to under Sections 111 and 137 of the Local Government Act 1972 are applicable where local authorities consider it appropriate. Then they can agree to make payments and can fix the amounts and criteria themselves in accordance with the needs.

The Government recognise the useful work done by tenants' organisations and indeed encourage their role as part of the management scheme. But as the Committee will be well aware the forms of tenants' organisations vary greatly. They have evolved to suit the various needs, conditions and resources of their members. My noble friend Lord Mottistone referred to this and the noble Lord, Lord Dean, referred to certain exclusions that he would suggest because of the variants in the types of organisations. Since the new clause seeks to specify how tenants' organisations should be constituted and organised in order to qualify for local authority support, we do not believe that we should impose a uniform regimented pattern in an area where variety, diversity and flexibility are necessary in order best to suit local situations.

The criteria used in the regulations, for example, would have to be very detailed and complex in order to avoid any accusation of unfairness or discrimination. We believe it is better for local authorities to continue to use their discretion in deciding which organisations are most deserving of support in what is essentially, as we see it, a local matter. In the light of these comments, I hope that the noble Lord and the noble Baroness will feel able to withdraw this amendment.

Lord Dean of Beswick

It is late in the evening and, although I am not satisfied or happy with the reply I have received, I intend to withdraw the amendment. But at the end of the day we shall have to move towards the type of proposals contained in the amendment. While the spin-off benefits that would be achieved in the community as a whole if the amendment were accepted could not be identified or quantified at this point of time, they would be more substantial than what would be paid out by the local authority in financing tenants' associations. Having said that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Colerainemoved Amendment No. 94: After Clause 11, insert the following new clause:

("Determination of price for leasehold enfranchisement.

.—(1) In section 9(1A) of the Leasehold Reform Act 1967 (determination of price payable for enfranchisement of higher value houses), in paragraph (a) (assumption that vendor is selling subject to existing tenancy) after "no right to acquire the freehold" insert "or an extended lease and, where the tenancy has been extended under this Part of this Act, that the tenancy will terminate on the original term date.".

(2) In section 23(5) of the Leasehold Reform Act 1967 (provisions as to tenancy granted in satisfaction of tenant's rights under Part I), in paragraph (b) (provisions which apply as if the tenancy were granted by way of extension) at the beginning insert "section 9(1) and (1A) above,".

(3) The above amendments apply notwithstanding that the tenant's notice under section 8 of the Leasehold Reform Act 1967 (notice of desire to have the freehold) was given before the commencement of this section if the price has not by then been determined by agreement or otherwise.").

The noble Lord said: In this amendment I am asking the Committee to put right an anomaly in the Leasehold Reform Act 1967 which arose as a result of the amendment to that Act made by the Housing Act 1974.

The 1967 Act allows the owners of long leases of houses at low rents to acquire from the freeholders the freeholds or extended leases of their houses. Both the lessee and the house must satisfy certain conditions, including a condition that the rateable value of the house must be less than a specified amount. This amount varies according to whether the house is in Greater London or elsewhere.

In 1974 following the rating revaluation of the previous year the Labour Government introduced provision in the Housing Bill designed, broadly speaking, to bring the rateable values for the Leasehold Reform Act up to date. The Bill was amended in another place and the lessees of some houses of high rateable values—between £1,000 and £1,500 in Greater London and £500 and £750 elsewhere—were given the opportunity to enfranchise or acquire an extended lease. This amendment was further amended in this Chamber.

The intended effect of the amendment made here was to provide that the lessees to whom the right to enfranchise was extended should pay enhanced compensation on enfranchisement. This amendment is now Section 9(1A) of the Leasehold Reform Act 1967. Unfortunately the amendment proved to be flawed in the sense that it did not fully achieve its intention of securing for the freeholders of houses with higher rateable values the enhanced compensation which was intended.

If a lessee applies now for direct enfranchisement the enhanced compensation is payable. If, however, he first applies for an extended lease under Section 14 of the 1967 Act, he will be granted an additional 50 years' lease at—and here I sympathise slightly—no more than an up-to-date ground rent. If then armed, as it were, with this extended lease he applies to enfranchise, he effectively pays the freeholder the lower rate of compensation applicable to houses in the lower rateable value range.

Surprisingly, perhaps, this loophole was not tested in the courts until 4th March of this year when it came before the Court of Appeal on appeal from the Lands Tribunal in the case of Mosley and others v. Hickman and others. That was reported in The Times on 5th March this year and also in the Estates Gazette on 17th May, but so far I have not seen it reported elsewhere. The judgment in that case established that where a lessee has previously acquired an extended lease under the 1967 Act and then applies to enfranchise, the freehold which he is buying falls to be valued as subject to that extended lease, as was argued on behalf of the lessees in the case, and not as if the extended lease had never been granted, as argued on behalf of the freeholder.

The Association of Land-owing Charities, which finds itself at some financial risk as a result of this loophole, in common with other freeholders, including the large estates in central London, has drawn my attention to the fact that during consideration in your Lordships' House on 10th May 1984 of messages from another place in relation to the Housing and Building Control Bill that year, I drew attention to the possibility that Section 9(1A) of the 1967 Act was flawed in this way. My noble friend Lord Bellwin agreed that if that proved to be the case, and serious problems emerged, then, subject to wider considerations the loophole should be closed by amending legislation at a suitable time.

It is not in dispute that a serious problem has now arisen. There are an unknown number—unknown, at least, to me—of properties affected, but my inquiries lead me to believe that the number is in all probability less than 1,000. In each case, the lessee now has it within his ability clearly to pay substantially less on enfranchisement than noble Lords intended in 1974. My amendment is intended to put matters right by amending the Leasehold Reform Act 1967.

Subsection (1) of my amendment is intended to make it clear that in fixing the enfranchisement price for higher rateable value houses under Section 9 (1A) of the 1967 Act, two assumptions should additionally be made. The first is that where a tenant has been granted an extended lease under Section 14 the term of such a lease will end on the original term date; and the second is that where a tenant has not been granted an extended lease under Section 14 he is not entitled to such a lease.

Subsection (2) relates to Section 23 of the 1967 Act and clarifies that a lessee who has obtained an extended lease with the approval of the court under that section can enfranchise. It makes clear that this also applies to the leases with which I am dealing tonight. Subsection (3) provides that the amendments will apply to cases in the pipeline at the time the new clause comes into force where no price for enfranchisement has been determined by agreement or otherwise.

It will be clear to the Committee from the final subsection that the date of commencement of this amending clause, if approved, will be of some importance. I should like to deal with that for a moment. Clause 40 of the Bill provides that most of the provisions of Part I, the housing section, are to come into force at the end of the period of two months beginning with the day on which the Act is passed. In the normal way, I should have asked the Committee to include this provision among those.

On the other hand, I see from Amendment No. 301 that my noble friend the Minister is proposing to ask that all the clauses should be brought into operaton by a commencement order.

In those circumstances I think that I should ask my noble friend, when she replies to the debate on this amendment, to indicate whether, on the basis that the Committee approves the amendment, my noble friend will undertake to bring this amendment into operation by a commencement order at the expiration of two months from the passing of the Act. I beg to move.

Baroness Hooper

I understand that my noble friend has pursued this point since it was brought to the attention of the House during the closing stages of the debates on the Housing and Building Control Act 1984, to which he has referred. Since that debate the Land Tribunal in a decision that my noble friend has already explained, and which was subsequently upheld in the Court of Appeal, showed that there was indeed a problem and that it could have significant implications for ground landlords.

Mv noble friend's new clause, which he explained very clearly to us, provides an admirable way of dealing with the point, and I commend it to the Committee. I trust that my noble friend will allow me to inform him subsequently about the commencement order point.

10.30 p.m.

Lord Dean of Beswickmoved Amendment No. 95: After Clause 11, insert the following new clause: ("In Schedule 2 to the Housing Act 1985 (ground for possession of dwelling-houses let under secure tenancies) in Part I (grounds on which court may order possession if it considers it reasonable), after Ground 8 (temporary accommodation during works) insert: ("Ground 8A The tenant or a person residing in the dwelling-house has been guilty of conduct against neighbours of a different racial or ethnic origin in accordance with Part VI of this Schedule and that conduct has interfered with those neighbours' enjoyment of their dwelling houses. At the end of that Schedule insert—

"PART VI

INCIDENTS OF RACIAL HARASSMENT

(1)—

1. (a) Unprovoked assaults including common assault, actual bodily harm and grievous bodily harm.
2. (b) Damage to property including breaking windows, doors and fences within the curtilage of dwelling houses occupied by neighbours.
3. (c) The writing or affixing of slogans and/or graffiti of a racial nature within or in the proximity of the curtilage of dwelling houses occupied by neighbours.
4. (d) Arson or attempted arson.
5. (e) The insertion of rags, paper, rubbish and/or any material which can be and/or has been set alight through openings in, or within the curtilage of, dwelling houses occupied by neighbours.
6. (f) The placing of excrement, eggs, paint, rubbish and/or offensive substances on any interior or exterior part of dwelling houses occupied by neighbours or within their curtilage.
7. (g) The insertion of excrement, eggs, paint, rubbish and/or other noxious and/or offensive substances through an opening in dwelling houses occupied by neighbours or within their curtilage.
8. (h) The sending of threatening and/or abusive correspondence of a racial naature.
9. (i) The making of threatening and/or abusive telephone calls of a racial nature.
10. (j) Oral racial abuse.
11. (k) Demanding money accompanied by oral racial abuse.
12. (l) Repeated vandalism of a conveyance belonging to neighbours or any member of their household.
13. (m) Threatening and/or abusive behaviour including spitting.
14. (n) Participation in any activity which is calculated to deter neighbours from occupying particular dwelling houses.

(2)—For the purpose of this Schedule "neighbours" includes "neighbour" and, in sub-paragraph 1(n), potential neighbours.")

The noble Lord said: Once again I have to make reference to the lateness of the hour, but this is a very important amendment. When what was happening was brought to the notice of me and my colleagues we just could not believe it. But there is Part IV, "Incidents of racial harassment", and, in proposing this new clause, I should just like to draw the attention of the Committee to the incidents mentioned:

1. "(a) Unprovoked assaults including common assault, actual bodily harm and grievous bodily harm.
2. (b) Damage to property including breaking windows."

There is there a catalogue of acts which make the mind boggle when you read them. One had to ask oneself at first, "Do these things really happen?" After speaking to the people involved in areas where these things happen, I have to say that these incidents are now not the occasional activity but in some areas they have become almost the regular treatment that is being meted out to ethnic groups, certainly in areas of London and to some extent in some of the other big cities.

This clause introduces a ground for possession in cases of racial harassment. It is supported by the Institute of Housing, the AMA, the ADC, the National Housing and Town Planning Council, the Federation of Black Housing Organisations and Shelter. They are alarmed at the increasing incidence of racial harassment and violence on public sector housing estates. Their research shows incidents throughout England and Wales among tenants of London boroughs, metropolitan districts, district councils and some housing associations. Some of these incidents include the nailing of a pig's head to the front door of a house occupied by a Moslem family, acts of arson, racist graffiti daubed on doors and windows, personal violence against people, including knifings and stabbings, threats of violence, so-called "reception committees" for black tenants when they take up a new local authority residence, smashing of windows, excrement pushed through letter boxes and verbal racist abuse.

The London Borough of Tower Hamlets has investigated over 500 cases since November 1983. The analysis for the borough in April 1985 alone reads: children harassed to and from school, including spitting, stone-throwing and pushing (nine cases); child or adult beaten up and pushed, verbal abuse, shot with air gun (six cases); windows broken, racist graffiti, cars vandalised, fireworks through letter-box (six cases); again, verbal abuse and persistent door-knocking, once again offensive material through letter-boxes (20 cases). The majority of those subjected to these acts were of Asian origin. There is similar evidence from most inner London boroughs, and large city councils including Nottingham, Birmingham and Rochdale.

Many of these incidents are of course covered by criminal law. However, the police are very often stretched in these areas and the level of investigations and subsequent prosecutions, with some notable and welcome exceptions, is unfortunately rather low. It is nearly always the housing authority or association to whom the victims turn for assistance. They are generally less concerned with securing a criminal conviction than they are with feeling safe in their neighbourhood and preventing further attacks. It is not surprising, therefore, that many victims see the most effective way out of their troubles as a transfer away from the harassment, or to move the perpetrators by eviction or transfer themselves.

Most authorities and associations do what they can within the law. In our view, to transfer the victims is not a solution in the longer term and action needs to be taken against those who have caused the problem. At the end of the day, after exhausting persuasion and less formal procedures, this of course means eviction.

Existing possession powers contain no provision for racial harassment. There is a ground for possession for causing nuisance or annoyance to neighbours, but there have been problems securing possession through the courts on this ground even in non-racial areas. This is often because the victims or those affected are reluctant to testify in person in court for fear of further violence or threats, should the case fail. This is so particularly in racial harassment cases. A further problem is that the perpetrators are not always neighbours and may be from different parts of the same estate, or even another estate.

A number of local authorities include, as a condition of their tenancy, that tenants shall not be guilty of racial harassment, and that appropriate action, including notice of seeking possession, will be taken. However, it is doubtful whether the courts will grant possession orders for racial harassment under this particular heading. We are seeking a specific ground for possession for cases of this type. The main reason for seeking the ground is to make the housing law absolutely clear and specific on racially-based attacks, rather than the more general concept of nuisance or annoyance to neighbours, which has not worked well to date. A supplementary reason, though, is to show through the legislative framework that racial attacks will not be tolerated.

Concern has been expressed in the past that to make harassment both a civil and a criminal offence would make the victims punishable twice for the same crime; that is, it would be double jeopardy. This argument is not considered to be helpful for the following reasons.

There are already a considerable number of precedents in existing grounds for possession; for instance, nuisance or annoyance to neighbours may be a criminal offence depending on the nuisance or annoyance involved. Possession for using a dwelling house for immoral or illegal purposes could also constitute an offence under the separate criminal law. Possession for ill-treating the landlord's furniture could also be the subject of separate action for criminal damage.

Under the amendment proposed, it would not be necessary to obtain a conviction for racial harassment in other courts on criminal grounds. The requirement would be to satisfy the county court judge that conduct of sufficient severity had taken place meriting the granting of a possession order. Action taken by the police or privately would be separate to the housing solution sought by the landlord.

Racial harassment was debated in the House of Commons. The Government raised the following objections to the inclusion of racial harassment as a ground for possession during the debate: that a suitable ground existed in Ground 2, Schedule 2 of the Housing Act 1985, which allows possession for nuisance or annoyance to neighbours—John Patten the Minister argued that case law to date did not suggest the need for further measures—that there were problems in getting victims to appear in court to give evidence for fear of reprisals, to which I have already referred; and that it should not be the landlord's responsibility to interfere in nuisance or annoyance which was not concerned with the victim's occupancy of his or her dwelling—the duty of quiet enjoyment.

Those were the points which the Government thought obviated the need to do as we suggested. We think that suitable grounds exist for doing so.

Before dealing with the technical arguments, a clear point of principle must be made. Racial harassment is a severe and increasing problem. The Metropolitan Police recorded 1,850 racial attacks in 1985, nearly half of which occurred at home. Most were common or criminal assaults. The clear-up rate by the police is fewer than 20 per cent. Racial harassment of the type described in the amendment is much more widespread, as the Tower Hamlets figures demonstrate.

Black people in this country have no confidence in statements that existing powers and procedures are adequate. Matters are becoming worse each year and the police and local authorities are seen to be wholly ineffective in dealing with the situation. A clear step of introducing a specific sanction against harassment is necessary as a demonstration that the matter is being taken seriously.

I should like to make some other points, but in view of the time and in fairness to the Committee, I believe that I have put forward the main points.

This is a situation that is beyond one's belief unless one lives among it or it has been brought to one's notice. As a society we cannot tolerate citizens of this country, whatever their colour, being treated in such a manner. I hope that the Government will accept the amendment or respond sympathetically to it to inspire some confidence in those communities and to show that we care about them. I beg to move.

10.45 p.m.

Lord Pitt of Hampstead

I am sorry that we are debating this matter so late because racial harassment is a serious matter, particularly in London. The Metropolitan Police and the local authorities are extremely worried. I have presided over two conferences on this matter called by the Metropolitan Police. The Commissioner has made this matter one of his priorities for this year. That will show how seriously the police see the problem.

The local authorities are also worried. Amendment No. 77A, which I withdrew, was given to me by Camden, my local authority, which is concerned about the problem. They asked me to table the amendment. I thought that the more detailed amendment tabled by my noble friend Lord Dean was better in many respects. I therefore withdrew my amendment. I support this amendment. I hope that the Government will give it the serious consideration it deserves and that the Committee will accept it.

There are two aspects to the matter. There is the criminal aspect which is the responsibility of the police, and we hope that the Public Order Bill will strengthen the hands of the police in dealing with it. The other aspect is that of the landlords—in particular local authority landlords because the problem occurs on their estates—and how they cope with it.

As my noble friend Lord Dean said, there is already, in theory, the possibility of being able to evict people because they are a nuisance or an annoyance to neighbours. But it is because of its experience that Camden asked me to put down an amendment. Camden wanted to evict a family. The tenant's son had shot two Bengali neighbours with an airgun causing them physical injury. The tenant's daughter had attacked a 12 year-old Asian girl as a result of which some glass was embedded in her leg. The council argued that this formed part of a campaign of racial harassment, because there had been other incidents.

Although the judge granted an order for possession—this is what disturbed Camden —its implementation was suspended so long as the defendant or any person residing with her committed no further act of nuisance or annoyance against any neighbours and so long as no airgun or other weapon capable of throwing missiles was kept on the premises. Had the judge fully appreciated the implication of what was happening and therefore the unsuitability of suspending the order, he would never have done so. Such judgments make it more difficult to secure witnesses for cases, because the witnesses are subject to further abuses of various sorts. The Institute of Housing and most councils are asking to be given a specific ground on which to evict tenants who behave in this way.

The Committee will agree, I think, about the seriousness of the matter and the unpleasantness of this situation being allowed to continue. When raised in another place, the argument was that there were existing laws available. My description of what has happened in Camden illustrates why councils are not satisfied that the mere removal of the cause of an annoyance to a neighbour is sufficient and want a specific right to remove the cause of these acts. These acts have been brought to the attention of the conferences over which I have presided. They were mentioned as incidents that had occurred. None of them, one likes to think, should be allowed to take place in this society.

There is the issue of criminal acts and criminal sanctions. But there is also the question of people being able to enjoy their homes. We are trying to deal with that second issue by providing this ground for removing people who behave in this way. I hope that on this occasion when the Government reply I can praise them. I support this amendment.

Lord Skelmersdale

Racial harassment in all its forms is an evil and, as the noble Lord said, sadly one that has grown into a major problem on all too many local authority housing estates, not only in London but regrettably elsewhere in the country. Attacks and harassment directed at people because of their racial or ethnic origin must be tackled and stamped out

The Government are anxious to do what they can to ensure that they are tackled effectively. The ministerial group on crime prevention decided earlier this month to set up an inter-departmental working group to look at the scope for greater co-operation among departments and local agencies for preventing and responding to such attacks. My department is involved in the Local Authorities Joint Working Party on Housing and Racial Equality which has been looking at the issue in relation to local authority housing as has the Commission for Racial Equality. The results of both bodies' investigations should be available soon.

I appreciate that the noble Lord, Lord Pitt, said that Amendment No. 95 was rather better than Amendment No. 77A. But I am afraid I cannot accept even Amendment No. 95 for two rather contradictory reasons. First, it is not clear that the real problem lies in the legislation. The present ground 2—to which most noble Lords referred—which enables a landlord to seek possession where there is a nuisance or annoyance to neighbours, appears to cover virtually all the activities listed in the proposed schedule. The difficulty may well lie more in getting the agencies involved to act decisively and—and this is a major problem throughout the criminal law, as the Committee will appreciate—in getting witnesses to give evidence. If that is the case, a new ground will not help and may even divert attention from what needs to be done.

The second reason is that, to the extent that there may be deficiencies in the present ground, the proposed amendment may not go far enough. One of the concerns that has been raised before is whether ground 2 would cover harassment of one another by residents of a block or estate if those co-residents are not immediate neighbours or if the offending behaviour did not take place in or adjacent to their home but elsewere in the block or estate. The amendment does not tackle this problem.

The amendment was of course tabled only very recently. Both the Commission for Racial Equality and the local authorities working party are still drafting their reports on racial harassment, so it is not reasonable to expect a definitive reaction from the Government today on whether an amendment like this is needed. However, because of the severity of this problem and the need to do everything possible to tackle it, I am willing to consider further whether there is any evidence emerging that ground 2 is inadequate in legislative terms as a means of combating racial violence and harassment, and, if so, whether the present ground could be amended or extended to remedy that inadequacy. I must, however, stress that I am not promising to bring, favour or accept amendments to this Bill. What I am promising to do is to consider the issue further and urgently. But time is very short, probably too short now, in relation to amending this Bill.

Lord Dean of Beswick

I am grateful to the Minister for his reply. I am sorry that he cannot agree with the amendment, but I am delighted to hear what he says about the cross grouping of Ministers who are dealing with the problem. Before taking this further I shall have a look at what he said, analyse it and perhaps refer to it in the later stages of this Bill in this Chamber. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Davidmoved Amendment No. 96: After Clause 11, insert the following new clause:

("Amendment to the Landlord and Tenant Act 1985.

.In section 8 of the Landlord and Tenant Act 1985 (implied term as to fitness for human habitation) in the Table contained in subsection 4 after

"on or after 6th July 1957.	In London: £80
	Elsewhere: £52"
insert "on or after June 1985	In London: £4,000
	Elsewhere: £3,000" ")

The noble Baroness said: The Department of the Environment's five-yearly English House Condition Survey (December 1982) showed that of 18.1 million dwellings in England, 1.1 million were unfit for human habitation, 900,000 lacked basic amenities and 3.9 million were in serious disrepair. On 14th December 1982 Mr. Stanley, the then Minister of State for Housing, said in another place that the number of dwellings in serious disrepair increased by 22 per cent. between 1976 and 1981. In the Observer of 18th November 1984 the housing officer for the AMA estimated that each year 50,000 more houses became unfit or fell into serious disrepair. Although local authorities have powers to require landlords to carry out works or to make closing or demolition orders, our experience is that they have made little impact. The procedures are often slow.

Section 8 of the Landlord and Tenant Act, by implying a covenant as to fitness for habitation into tenancy agreements, in theory already allows tenants themselves to take action through the courts to compel landlords to make premises fit for human habitation, and to pay compensation for illness, loss of property and discomfort caused by living in unfit premises. Practically, though, this section is of very little use because it applies only to tenants who pay rent of less than £80 per year in London, and £52 per year elsewhere. The purpose of this amendment is to extend this existing right to a larger number of tenants, by increasing the rent limits to £4,000 per year (that is, £76 per week) in London and £3,000 per year (that is, £57 per week) outside London.

The principle that rented accommodation should be fit for habitation has been recognised since 1909. However, despite consolidation last year, rent limits have not been increased since 1957. In Quik v Taff-Ely, a case that is well known, Lord Justice Dillon said: in view of inflation the section must now have remarkably little application". In the same case, Lord Justice Lawton said that new rent limits for the section were needed. That is what this amendment seeks to adjust, and although other repairing obligations are implied by Section 11 of the Landlord and Tenant Act, it does not apply to pre-1961 tenancies or tenancies for periods of more than seven years. Nor does Section 11 provide remedies for severe condensation caused by design defects.

It is nonsense that at present the law permits landlords to let premises which are unfit for human habitation. The amendment should rectify this.

Baroness Hooper

The origins of Section 8 seem to backdate to 1885 and 1909, and the rent levels were last updated in 1957. It is the rent levels that the noble Baroness's amendment seeks to update. The amendment would have the effect of applying Section 8 to lettings made after June 1985 where the annual rent is less than £4,000 in London and £3,000 elsewhere.

When these provisions were enacted the housing scene in this country was very different. There was not the range of public health and housing legislation that is on the statute books today, and the provisions of Section 8 may have been a necessary measure to prevent the use of unfit or unhabitable houses. Since then many thousands of unfit houses have been demolished, or have been improved, and many have been sold into owner-occupation. Local authorities have a wide range of powers and duties under which housing conditions are controlled. Later statute has imposed specific repairing obligations on landlords. In 1961, the provisions now contained in Sections 11 to 16 of the Landlord and Tenant Act 1985 were introduced, and they imply a repairing convenant on landlords of leases granted after October 1961 for less than seven years. The provisions of Section 8 have thus been overtaken, and extending its application by uprating the rent levels in the way the noble Baroness proposes would really serve little purpose. I trust the noble Baroness will feel able to withdraw the amendment on that basis.

Baroness David

It seems a pity if that is really the case, that this was not dealt with when the consolidation Act was considered last year. I shall read what the noble Baroness said, and for the moment I withdraw the amendment.

Amendment by leave, withdrawn.

11 p.m.

Clause 12 [Minor and consequential amendments, repeals]:

Lord Skelmersdalemoved Amendment No. 97: Page 26, line 41, at end insert— ("( ) the steps to be taken where there is a change of landlord in the course of exercise of the right to buy.").

The noble Lord said: I beg to move. I spoke to this amendment when we dealt with Amendment No. 32.

Lord Skelmersdalemoved Amendment No. 98: Page 26, line 43, at end insert— ("(da) the maximum penalty for voting in contravention of section 618(3) of the Housing Act 1985 (member of Common Council or committee voting on matter in which he is interested);").

The noble Lord said: I beg to move Amendment No. 98 and also to speak to Amendments Nos. 101, 106, 109, 110, 111, 123, 125, 305, 308, 313, 316, 105, and 320. I regret that they are on the wrong order, but they are the right numbers.

These amendments correct certain errors which were made in last year's consolidation of the housing legislation. With one exception they restore the law to what it was before the consolidation. At this time of night I shall not detain the Committee by going into details.

The exception concerns the amendment to Section 618 of the Housing Act 1985, which as it stands lays down a penalty not exceeding level 2 on the standard scale for a member of the housing committee of the Common Council of the City of London, or its housing committee, which votes on a housing matter concerning land in which he or she has a beneficial interest.

If the law were to be restored to what it was before, the penalty should be set at level 3, not level 2. The amendment, however, provides for a penalty not exceeding level 4. That is in order to bring this provision into line with Section 94(2) of the Local Government Act 1972, which is the general provision disabling members of local authorities from voting on matters in which they have a pecuniary interest. The Common Council has been consulted and has agreed that it would be appropriate to bring Section 618 of the Housing Act into line with the corresponding provision of the Local Government Act. I beg to move.

Lord Skelmersdalemoved Amendment No. 99: Page 26, line 43, at end insert— ("(db) the withholding of consent to the assignment by way of exchange of a secure tenancy of a dwelling-house managed by a certain description of housing association;").

The noble Lord said: This amendment was dealt with earlier when we got our numbers into a muddle.

Baroness David

It was dealt with last Tuesday.

Lord Skelmersdale

It has already been spoken to. I beg to move.

[Amendment No. 100 not moved.]

Lord Skelmersdalemoved Amendment No. 101: Page 27, leave out line 3 and insert— ("(g) miscellaneous corrections.").

The noble Lord said: I spoke to this amendment when I dealt with Amendment No. 98. I beg to move.

[Amendment No. 102 had been withdrawn from the Marshalled List.]

Clause 12, as amended, agreed to.

[Amendment No. 103 not moved.]

Lord Skelmersdalemoved Amendment No. 103A: Before Schedule 3, insert the following new Schedule—

("FURTHER PROVISIONS WITH RESPECT TO SHARED OWNERSHIP LEASES

The Rent Act 1977 (c. 42)

l.—(l) Part I of the Rent Act 1977 (preliminary provisions) is amended as follows.

(2) After section 5 insert— Certain shared ownership leases. 5A.—(1) A tenancy is not a protected tenancy if it is a qualifying shared ownership lease, that is—

1. (a) a lease granted in pursuance of the right to be granted a shared ownership lease under Part V of the Housing Act 1985, or
2. (b) a lease granted by a housing association and which complies with the conditions set out in subsection (2) below.

(2) The conditions referred to in subsection (1)(b) above are that the lease—

1. (a) was granted for a term of 99 years or more and is not (and cannot become) terminable except in pursuance of a provision for re-entry or forfeiture;
2. (b) was granted at a premium, calculated by reference to the value of the dwelling-house or the cost of providing it, of not less than 25 per cent., or such other percentage as may be prescribed, of the figure by reference to which it was calculated;
3. (c) provides for the tenant to acquire additional shares in the dwelling-house on terms specified in the lease and complying with such requirements as may be prescribed;
4. (d) does not restrict the tenant's powers to assign, mortgage or charge his interest in the dwelling-house;
5. (e) if it enables the landlord to require payment for outstanding shares in the dwelling-house, does so only in such circumstances as may be prescribed;
6. (f) provides, in the case of a house, for the tenant to acquire the landlord's interest on terms specified in the lease and complying with such requirements as may be prescribed; and
7. (g) states the landlord's opinion that by virtue of this section the lease is excluded from the operation of this Act.

(3) The Secretary of State may by regulations prescribe anything requiring to be prescribed for the purposes of subsection (2) above. (4) the regulations may—

1. (a) make different provision for different cases or descriptions of case, including different provisions for different areas, and
2. (b) contain such incidental, supplementary or transitional provisions as the Secretary of State considers appropriate,

and shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament. (5) In any proceedings the court may, if of opinion that it is just and equitable to do so, treat a lease as a qualifying shared ownership lease notwithstanding that the condition specified in subsection (2(g) above is not satisfied. (6) In this section— house" has the same meaning as in Part I of the Leasehold Reform Act 1967; housing association" has the same meaning as in the Housing Associations Act 1985; and lease" includes an agreement for a lease, and references to the grant of a lease shall be construed accordingly.". (3) In section 19(5) (contracts which are not restricted contracts), after paragraph (c) insert— (cc) it creates a qualifying shared ownership lease within the meaning of section 5A of this Act; or".

The Rent (Agriculture) Act 1976 (c. 80)

2. In Schedule 2 to the Rent (Agriculture) Act 1976 (licences and tenancies giving rise to protected occupancy), in paragraph 3 (adaptation of provisions of Rent Act 1977 as they apply for the purposes of the 1976 Act), after sub-paragraph (2) insert— (2A) In section 5A (exclusion of certain shared ownership leases), in subsection (2)(g) (condition that lease states landlord's opinion that 1977 Act does not apply) for the reference to the 1977 Act substitute a reference to this Act.".

Part I of the Leasehold Reform Act 1967 (c. 88)

3. In section 1 of the Leasehold Reform Act 1967 (tenants entitled to enfranchisement or extension), after subsection (1) insert— (1A) The references in subsection (1)(a) and (b) to a long tenancy at a low rent do not include a tenancy excluded from the operation of this Part by section 33A of and Schedule 4A to this Act".

4. In section 3(2) of the Leasehold Reform Act 1967 after "long tenancy at a low rent" insert "(other than a lease excluded from the operation of this Part by section 33A of and Schedule 4A to this Act)".

5. After section 33 of the Leasehold Reform Act 1967 insert— Exclusion of certain shared ownership leases. 33A. The provisions of Schedule 4A to this Act shall have effect to exclude certain shared ownership leases from the operation of this Part of this Act.". leases.

6. After schedule 4 to the Leasehold Reform Act 1967 insert—

"SCHEDULE 4A

EXCLUSION OF CERTAIN SHARED OWNERSHIP LEASES.

Leases granted in pursuance of right to be granted a shared ownership lease.

1. A lease granted in pursuance of the right to be granted a shared ownership lease under Part V of the Housing Act 1985 is excluded from the operation of this Part of this Act.

Certain leases granted by certain public authorities

2.—(1) A lease which—

1. (a) was granted at a premium by a body mentioned in subparagraph (2), and
2. (b) complies with the conditions set out in sub-paragraph (3), is excluded from the operation of this Part at any time when the interest of the landlord belongs to such a body.

(2) The bodies are—

1. (a) a county, district or London borough council, the Common Council of the City of London or the Council of the Isles of Scilly;
2. (b) the Inner London Education Authority or a joint authority established by Part IV of the Local Government Act 1985;
3. (c) the Commission for the New Towns or a development corporation established by an order made, or having effect as made, under the New Towns Act 1981;
4. (d) an urban development corporation within the meaning of Part XVI of the Local Government, Planning and Land Act 1980;
5. (e) the Development Board for Rural Wales.

(3) The conditions are that the lease—

1. (a) provides for the tenant to acquire the freehold for a consideration which is to be calculated in accordance with 460 the lease and which is reasonable, having regard to the premium or premiums paid by the tenant under the lease, and
2. (b) states the landlord's opinion that by virtue of this paragraph the tenancy will be excluded from the operation of this Part of this Act at any time when the interest of the landlord belongs to a body mentioned in sub-paragraph (2) above.

(4) If, in proceedings in which it falls to be determined whether a lease complies with the condition in sub-paragraph (3)(a), the question arises whether the consideration payable by the tenant on acquiring the freehold is reasonable, it is for the landlord to show that it is.

Certain leases granted by housing associations

3.—(1) A lease granted by a housing association and which complies with the conditions set out in sub-paragraph (2) is excluded from the operation of this Part of this Act, whether or not the interest of the landlord still belongs to such an association.

(2) The conditions are that the lease—

1. (a) was granted for a term of 99 years or more and is not (and cannot become) terminable except in pursuance of a provision for re-entry of forfeiture;
2. (b) was granted at a premium, calculated by reference to the value of the house or the cost of providing it, of not less than 25 per cent., or such other percentage as may be prescribed, of the figure by reference to which it was calculated;
3. (c) provides for the tenant to acquire additional shares in the house on terms specified in the lease and complying with such requirements as may be prescribed;
4. (d) does not restrict the tenant's powers to assign, mortgage or charge his interest in the house:
5. (e) if it enables the landlord to require payment for outstanding shares in the house, does so only in such circumstances as may be prescribed;
6. (f) provides for the tenant to acquire the landlord's interest on terms specified in the lease and complying with such requirements as may be prescribed; and
7. (g) states the landlord's opinion that by virtue of this paragraph the lease is excluded from the operation of this Part of this Act.

(3) In any proceedings the court may, if of opinion that it is just and equitable to do so, treat a lease as satisfying the conditions in sub-paragraph (2) notwithstanding that the condition specified in paragraph (g) of that sub-paragraph is not satisfied.

(4) In this paragraph "housing association" has the same meaning as in the Housing Associations Act 1985.

4.—(1) A lease for the elderly granted by a registered housing association and which complies with the conditions set out in sub-paragraph (2) is excluded from the operation of this Part of this Act at any time when the interest of the landlord belongs to such an association.

(2) The conditions are that the lease—

1. (a) is granted at a premium which is calculated by reference to a percentage of the value of the house or of the cost of providing it,
2. (b) complies, at the time when it is granted, with such rquirements as may be prescribed, and
3. (c) states the landlord's opinion that by virtue of this paragraph the lease will be excluded from the operation of this Part of this Act at any time when the interest of the landlord belongs to a registered housing association.

(3) In this paragraph— lease for the elderly" has such meaning as may be prescribed; and registered housing association" has the same meaning as in the Housing Associations Act 1985.

Power to prescribe matters by regulations

5.—(1) The Secretary of State may by regulations prescribe anything requiring to be prescribed for the purposes of this Schedule.

(2) The regulations may—

1. (a) make different provision for different cases or descriptions of case, including different provision for different areas, and
2. (b) contain such incidental, supplementary or transitional provisions as the Secretary of State considers appropriate,

and shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Interpretation

6. In this Schedule "lease" means a lease at law or in equity, and references to the grant of a lease shall be construed accordingly."

Consequential amendments and repeals

7. In the Housing Act 1980, omit section 140.

8. In the Local Government, Planning and Land Act 1980, omit section 156(3).

9.—(1) The Local Government Act 1985 is amended as follows.

(2) In Schedule 13 (application of local authority provisions to residuary bodies), in paragraph 14, after sub-paragraph (a) insert— (aa) paragraph 2 of Schedule 4A to the Leasehold Reform Act 1967;". and at the end of sub-paragraph (b) insert "and" and omit subparagraph (d) and the word "and" preceding it.

(3) In Schedule 14. omit paragraph 58(e). 10. In Part IV of the Housing Act 1985 (secure tenancies), in section 115 (meaning of "long tenancy"), in subsection (2)(c) after "1980" insert "or paragraph 3(2)(b) of Schedule 4A to the Leasehold Reform Act 1967".

Transitional provisions and savings

11).—(1) The amendments made by this Schedule apply only in relation to leases granted after the commencement of this Schedule.

(2) This Schedule does not affect the operation of section 140 of the Housing Act 1980, the enactments applying that section and regulations made under it, in relation to leases granted before the commencement of this Schedule.".").

The noble Lord said: I spoke to this amendment when we dealt with Amendment No. 91. I beg to move.

Schedule 3 [Housing: minor and consequential amendments]:

Lord Skelmersdalemoved Amendment No. 104: Page 96, line 39, at end insert—

("Re-service of notices, etc. on change of landlord in course of exercise of right to buy

3A.—(1) Section 137 of the Housing Act 1985 (change of landlord after notice claiming right to buy or right to a mortgage) is amended as follows.

(2) Make the existing provision subsection (1) and in it after "all parties shall" insert", subject to subsection (2),".

(3) After that subsection insert—

"(2) If the circumstances after the disposal differ in any material respect, as for example where—

1. (a) the interest of the disponee in the dwelling-house after the disposal differs from that of the disponor before the disposal, or
2. (b) the right to a mortgage becomes exercisable against the Housing Corporation rather than the landlord, or vice versa, or
3. (c) any of the provisions of Schedule 5 (exceptions to the right to buy) becomes or ceases to be applicable,

all those concerned shall, as soon as practicable after the disposal, take all such steps (whether by way of amending or withdrawing and re-serving any notice or extending any period or otherwise) as may be requisite for the purpose of securing that all parties are, as nearly as may be, in the same position as they would have been if those circumstances had obtained before the disposal.").

The noble Lord said: I spoke to this amendment when I dealt with Amendment No. 32. I beg to move.

Lord Skelmersdalemoved Amendment No. 105: Page 97, line 15, leave out ("142") and insert ("152").

The noble Lord said: I beg to move Amendment No. 105 and speak to No. 106. I spoke to them with Amendment No. 98.

Lord Skelmersdalemoved Amendment No. 106: Page 97, line 24, at end insert—

("Penaltyifor voting on certain housing matters

4A.—(1) In section 618(4) of the Housing Act 1985 (penalty for member of Common Council or committee voting on housing matter relating to land in which he is interested), for "level 2 on the standard scale" substitute "level 4 on the standard scale".

(2) The above amendment does not apply to offences committed before the commencement of this paragraph.").

Lord Skelmersdalemoved Amendment No. 107: Page 97, line 24, at end insert—

"Grounds for withholding consent to assignment of secure tenancy

4B. In Schedule 3 to the Housing Act 1985 (grounds for withholding consent to assignment by way of exchange). after Ground 9 add—

"Ground 10

The dwelling-house is the subject of a management agreement under which the manager is a housing association of which at least half the members are tenants of dwelling-houses subject to the agreement, at least half the tenants of the dwelling-houses are members of the association and the proposed assignee is not, and is not willing to become, a member of the association.".").

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

[Amendment No. 108 not moved.]

Lord Skelmersdalemoved Amendment No. 109: Page 98, line 40, at end insert— (" (1A) In section 251(5)(b) of the Housing Act 1985 after "housing action" insert "area". (1B) In section 256(4)(b) of the Housing Act 1985 for "to the local planning authority" substitute "of the local planning authority".").

The noble Lord said: I beg to move Amendment No. 109, and speak to Nos. 110 and 111. I spoke to them with Amendment No. 98.

Lord Skelmersdalemoved Amendments Nos. 110 and 111: Page 99, line 3, at end insert— ("(3A) In paragraph 27 of Schedule 2 to the Housing (Consequential Provisions) Act 1985 for "(4)", in both places where it occurs, substitute "(6)". (3B) In Schedule 3 to the Housing (Consequential Provisions) Act 1985, after paragraph 2 insert— 2A. Any order made under section 115(11) of the Housing Act 1974 (form of notice of compensation where land in clearance area deemed appropriated for provision of housing) which was in force immediately before the repeal of that section by this Act may be revoked or amended by regulations under section 614 of the Housing Act 1985 (general power to prescribe forms, etc. by regulations)."."). Page 99, line 4, at end insert— ("8.—(1) In sections 80(l)(a) and 81(1)(a), (3)(b) and (4)(b) of the Building Act 1984 (service of notices in respect of proposed demolition), after "demolition order" insert "or obstructive building order". (2) The above amendment to section 80 of the Building Act 1984 has effect from Ist April 1986. 9. In Part II of the Housing Associations Act 1985 (housing association finance)—

1. (a) in section 67(1) (loans by Public Works Loan Commissioners: England and Wales), and
2. (b) in section 68(1) (loans by Public Works Loan Commissioners; Scotland,

for "housing association" substitute "registered housing association".").

Lord Skelmersdalemoved Amendment No. 112: Page 99, line 9, at end insert— (" 1A. In section 16 of the Rent Act 1977 (tenancy not protected if interest of landlord belongs to housing co-operative) for the words from "within the meaning of section 27" to the end substitute "within the meaning of section 27B of the Housing Act 1985 (agreements with housing co-operatives under certain superseded provisions) and the dwelling-house is comprised in a housing co-operative agreement within the meaning of that section".").

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

Lord Skelmersdalemoved Amendment No. 113: Page 99, line 9, at end insert— ("1B.—(1) Schedule 12 to the Rent Act 1977 (procedure on application for certificate of fair rent) is amended as follows. (2) In paragraph 1(c)—

1. (a) after "section 69(1)(a)" insert "or (1A)(b)";
2. (b) after "improvement" insert "or repair";
3. (c) after "regulated" insert "or secure".

(3) In paragraph 3, after "if," insert— in the case of—

1. (a) an application under section 69(1) of this Act where the dwelling-house is not subject to a regulated tenancy, or
2. (b) an application under section 69(1A) of this Act where the dwelling-house is not subject to a secure tenancy,";

and omit "unless the dwelling-house is subject to a regulated tenancy". (4) In paragraph 4, for the words from "an application" to "regulated tenancy" substitute"—

1. (a) an application under section 69(1) of this Act where the dwelling-house is not subject to a regulated tenancy and which does not fall within paragraph 3 above, or
2. (b) an application under section 69(1A) of this Act and which does not fall within paragraph 3 above and where the dwelling-house is not subject to a secure tenancy,".

(5) In paragraph 5(1), for "Where the dwelling-house is subject to a regulated tenancy" substitute "In the case of—

1. (a) an application under section 69(1) of this Act where the dwelling-house is subject to a regulated tenancy, or
2. (b) an application under section 69(1A) of this Act where the dwelling-house is subject to a secure tenancy,".

(6) In paragraph 8(2) and 11, after "regulated" insert "or secure". (7) After paragraph 11 add— 12. In this Schedule 'secure tenancy' has the same meaning as in Part IV of the Housing Act 1985, but does not include such a tenancy where the landlord is the Housing Corporation, a housing association or a housing trust which is a charity. In this paragraph 'housing association', 'housing trust' and `charity' have the same meaning as in Part IV of the Housing Act 1985.".")

The noble Lord said: I spoke to this with Amendment No. 27. I beg to move.

Lord Skelmersdalemoved Amendment No. 114: Page 99, line 12, leave out from ("discount),") to the end and insert ("in paragraph (e) for "section 27 of the Housing Act 1985" substitute "section 27B of the Housing Act 1985".")

The noble Lord said: I beg to move Amendment No. 114, and speak to Nos. 115, 116, 117, 118 and 119. I spoke to all these with Amendment No. 26.

Lord Skelmersdalemoved Amendments Nos. 115, 116, 117, 118 and 119: Page 99, line 29, at end insert— ("5A. In section 20 of the Housing Act 1985 (houses of local authority to which management provisions apply), for "down to section 26" substitute "down to section 27B"."). Page 100, leave out lines 5 to 7 and insert (", for subsection (4) (housing co-operatives to which the section applies) substitute— (4) This section applies to a housing co-operative within the meaning of section 27B (agreements under certain superseded provisions) where the dwelling-house is comprised in a housing co-operative agreement within the meaning of that section."."). Page 100, line 9, at end insert— (""consent (in Schedule 3A) paragraph 2(3) of that Schedule" "). Page 100, line 12, leave out ("section 27") and insert ("sections 27(2) and 27B(4)"). Page 100, line 17, leave out ("after paragraph (a)") and insert ("in paragraph (a) after "7" insert "or 7A" and after that paragraph").

Lord Skelmersdalemoved Amendment No. 120: Page 100, line 25, at end insert— ("13A.—(1) Section 187 of the Housing Act 1985 (minor definitions for purposes of Part V (the right to buy)) is amended as follows. (2) In the definition of "improvement"—

1. (a) after "means" insert ", in relation to a dwelling-house,",
2. (b) for "a dwelling-house", in both places, substitute "the dwelling-house", and
3. (c) at the end (full-out after paragraph (c)) insert "and shall be similarly construed in relation to any other building or land;".

(3) At the appropriate place insert— 'improvement contribution' means an amount payable by a tenant of a flat in respect of improvements to the flat, the building in which it is situated or any other building or land, other than works carried out in discharge of any such obligations as are referred to in paragraph 16A(1) of Schedule 6 (obligations to repair, reinstate, etc.);").

The noble Lord said: I beg to move Amendment No. 120, and speak to Nos. 121 and 122. I spoke to them all with Amendment No. 11.

Lord Skelmersdalemoved Amendments Nos. 121 and 122: Page 100. line 34, at end insert— ("improvement contribution section 187"). Page 100, line 42, at end insert— ("reference period for purposes of s. 125A or 125B). section I25C")

Lord Skelmersdalemoved Amendment No. 123: Page 100, line 43, leave out ("(1)").

The noble Lord said: I spoke to this with Amendment No. 98. I beg to move.

Lord Skelmersdalemoved Amendment No. 124: Page 101, line 14, leave out ("section 27") and insert ("sections 27(2) and 27B(4)").

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

Lord Skelmersdalemoved Amendment No. 125: Page 101, line 29, leave out ("section for") and insert ("to").

The noble Lord said: I spoke to this amendment with Amendment No. 98. I beg to move.

Lord Skelmersdale moved Amendments Nos. 126, 127 and 128: Page 102, line 26, leave out sub-paragraph (3) and insert— ("(3) In paragraph 7 (the landlord condition for qualifying period)—

1. (a) in sub-paragraph (1), in the opening words, after "subject to" insert "paragraph 7A and to", and omit the words from "a housing co-operative" to "management functions)";
2. (b) in sub-paragraph (2), omit the words from "a housing cooperative" to "1975".

(4) After paragraph 7 insert— 7A.—(1) The landlord condition shall be treated as having been satisfied in the case of a dwelling-house comprised in a housing co-operative agreement made—

1. (a) in England and Wales, by a local housing authority, new town corporation or the Development Board for rural Wales, or
2. (b) in Scotland, by an islands or district council,

if the interest of the landlord belonged to the housing cooperative. (2) In sub-paragraph (1) "housing co-operative agreement" and "housing co-operative"—

1. (a) as regards England and Wales have the same meaning as in section 27B (agreements with housing co-operatives under superseded provisions), and
2. (b) as regards Scotland mean an agreement made under section 5 of the Housing Rents and Subsidies (Scotland) Act 1975 and a housing co-operative within the meaning of that section.".")

Page 102, line 45, leave out from ("agreement") to ("or") in line 47 and insert ("within the meaning of the Housing Act 1985 (see sections 27(2) and 27B(4) of that Act: delegation of housing management functions by certain authorities),"). Page 103. leave out lines 6 and 7.

The noble Lord said: I beg to move Amendments Nos. 126, 127 and 128 together. I spoke to these with Amendment No. 26.

Schedule 3, as amended, agreed to.

Baroness Hooper

This may be a convenient moment to break the proceedings of this Committee. I beg to move that the House do now resume.

Moved accordingly, and, on Question, House resumed.

House adjourned at eleven minutes past eleven o'clock.