Lords Sitting of 10 October 1988

Preamble
Reassembling after the Summer Recess, the House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Gloucester.

Tributes: Lord Peart
The Lord Privy Seal (Lord Belstead): My Lords, I know that during our summer adjournment the House will have been saddened by the death of a number of Peers, whom we miss. Our sympathy goes out to their relatives and friends.
I should like in particular to pay tribute to Lord Peart, formerly Lord Privy Seal and Leader of your Lordships' House, who died on 26th August. Lord Peart came to this House after a highly distinguished career in another place, both as its Leader and as Minister of Agriculture. Indeed, few Ministers can have had such a long, happy and successful association with a Ministry as did Fred Peart with the Ministry of Agriculture, Fisheries and Food.
Lord Peart came to your Lordships' House in 1976 as Leader and Lord Privy Seal in succession to Lord Shepherd. He held that position until 1979. I understand that he was the first Minister since Disraeli to serve as Leader of both Houses of Parliament. Like the Earl of Beaconsfield. he made his maiden speech as Leader of the House, speaking from the Dispatch Box.
It is not an easy task to come straight from another place to lead your Lordships' House. It says much for Lord Peart's character and charm that he instantly endeared himself to the whole House. Although in recent years we saw less of him as his health deteriorated, I am sure that I speak for all your Lordships in saying how much we regret his death, and that we send our sympathy to Lady Peart on this occasion.
Lord Cledwyn of Penrhos: My Lords, the noble Lord the Leader of the House has paid a warm well-deserved tribute to our late friend and colleague, Lord Peart. We are grateful to the noble Lord, Lord Belstead. Fred Peart showed an interest in politics from an early age. No doubt this was due to his father, who was active in the political life of the North-East and who had been agent to Manny Shinwell in the Easington constituency. It was not surprising therefore that he was one of the young men elected to the 1945 Parliament. His friendly and sociable personality ensured that he soon became a popular Member.
I think it would be right to say that Fred Peart's parliamentary career was influenced and shaped by his association with Tom Williams, the notable postwar Minister of Agriculture who appointed him to be his Parliamentary Private Secretary. This introduced Fred Peart to the farming world and it is as a dedicated and hard-working Minister of Agriculture that he will be remembered. He was genuinely
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attached to farmers and to their industry and he fought their battles with skill and a great deal of success. His first price review was not an easy one, but he progressively gained the farmers' confidence by his championship of their interests.
I succeeded Lord Peart as Minister during the grim foot-and-mouth disease epidemic in 1968 and I can therefore vouch from personal knowledge for the affection in which he was held. To be a popular Minister of Agriculture is no mean achievement. If there is a good harvest, the Almighty and the farmers receive the credit; if there is a bad one, the Minister of Agriculture gets the blame.
His qualities made Lord Peart a respected Leader of the House of Commons. When he came here in 1976 as Leader, he adapted quickly and I know that this House responded readily to those qualities. I should add that as Leader in both Houses he took a warm interest in the staff at all levels, and I know that this was much appreciated. Fred Peart was above all a good companion and an enthusiastic sportsman. He enjoyed the company of his friends in both Houses and he will he greatly missed. Our deep sympathy goes to Lady Peart and to Emerson, his son.
Lord Jenkins of Hillhead: My Lords, although I never witnessed Lord Peart's leadership of this House, I sat with him in the House of Commons for 27 years and in Cabinet with him for seven years. I think I can therefore claim to have known him fairly well over a substantial chunk of his life.
He held great offices without flamboyance and had that remarkable distinction to which the noble Lord the Leader of the House referred. He shared in this century with the noble Viscount, Lord Whitelaw, and no one else the distinction of being Leader of both Houses of Parliament. He also shared that remarkable distinction from the last century with Lord John Russell and Disraeli and no one else. He did a great deal for British agriculture. But what I most recall about him was that he was an exceptionally agreeable man who infused any gathering at which he was present with warmth and friendliness. Like me he was born into the regional Labour establishment and was one of those who helped to keep the Labour Party moderate and broad-based during its period of maximum power. We by no means always agreed. Indeed we once fought a deputy leadership contest against each other.
Europe was for long the divide, although in his last period as Minister of Agriculture, Fisheries and Food I think he rather changed his view and indeed came to enjoy what one might describe as the market day festivities of the Council of Agricultural Ministers. However, he never imported any rancour into disagreements. He spread goodwill around him and I think and hope that he enjoyed his life until the brutal misfortune which struck him a few years ago. We remember him with respect and affection and send our sympathy to his widow and son.
Baroness Stedman: My Lords, from these Benches we also wish to join with the noble Lords, Lord Cledwyn of Penrhos and Lord Jenkins of Hillhead, in

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their appreciation of the work of Lord Peart. Many of us on the SDP Benches served under Lord Peart in the Labour Party before 1981 and we always enjoyed his goodwill and affection. We remember with pride what we were able to do under his leadership in this House. Like others who have spoken, our sympathy goes to his widow and family.
Lord Mowbray and Stourton: My Lords—
Noble Lords: Order!
Baroness Hylton-Foster: My Lords, I know that noble Lords sitting on the Cross-Benches would want to be associated with the tributes already paid to Lord Peart who was a very modest man with a great deal of common sense. We on these Benches admired his courage very much when he came back to this House after being hit on the head by robbers in his own home. We join with other noble Lords in sending our sympathy to his widow and son.
Lord Mowbray and Stourton: My Lords, I apologise to the noble Baroness for interrupting earlier. I wish to say one thing about Lord Peart from the Back Benches of the Conservative Party. Lord Peart was a great man. He once said to me, "Do you know, Charles, what I feel about your religion?" I replied that I did not. He said, "Let me show you a photograph." He gave me a photograph of himself with the Pope. It was signed by the Pope: "To my good friend, Fred." That more than explained to me what the man, Fred Peart, meant to all of us in this House. He was a man who stood up for himself and for all of us. I cannot express my feelings stronger than to say that I have never known a man more pleased to have that photograph of himself with the Pope. He knew that I would be pleased about that.

Letter Post Monopoly
2.46 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
Whether they are considering any permanent change in the monopoly possessed by the Post Office for handling ordinary mail.
The Secretary of State for Trade and Industry (Lord Young of Graffham): My Lords, the possibility of ending or modifying the letter monopoly is kept under review, but we have currently no firm plans to make any changes.
Lord Campbell of Croy: My Lords, I thank my noble friend for that reply. Is he aware that during the recent strike many large companies and corporations were able to continue much of their business by means of facsimiles and other facilities, and that those who suffered most were small firms and the general public? No benefit appears to have been gained by either party in the dispute.
Lord Young of Graffham: My Lords, I am very grateful to my noble friend. I am very well aware of the great dislocation which the recent strike caused to small businesses. We all greatly regret that. I hope very much that those who work in the Post Office will take that into account in the future.
Lord Williams of Elvel: My Lords, can we take it from the reply of the noble Lord that, in line with what the Prime Minister has said, the Royal Mail is safe in her hands?
Lord Young of Graffham: My Lords, the noble Lord will be aware that the Royal Mail may not be safe in the hands of those who work in the Post Office unless they are prepared to exercise their sense of responsibility to businesses both great and small, in the country.
Lord Boyd-Carpenter: My Lords, is it not wrong in principle that a monopoly should be held by a public service which has no no-strike agreement and which therefore leaves the public wholly vulnerable to such action?
Lord Young of Graffham: My Lords, since 1981 the monopoly has extended only to letters priced below£1. We shall have to keep our options open. The situation depends very much on the conduct of the Post Office in the future.
Lord Molloy: My Lords, does the Minister agree that the cause of the strike was the failure of the management to attract staff in areas which badly needed them? Moreover, does the Minister also agree that it might have been wise for the management to confer with the unions involved in order to try to find a solution and thus avoid a strike? The strike was caused by myopic arrogance.
Lord Young of Graffham: My Lords, I should hate to describe the unions in those terms.
Lord Tordoff: My Lords, will the noble Lord agree that the rate of increase in postal charges is so fast that the£1 cover will not last very long?
Lord Young of Graffham: My Lords, the£1 cover has lasted for some considerable time. I live in hope that, by looking to its efficiency, the Post Office will ensure that it lasts a great deal longer.
Lord Mackie of Benshie: My Lords, will the noble Lord say what steps he is taking to improve efficiency and labour relations so that the public may receive the service it used to have?
Lord Young of Graffham: My Lords, that is very much a matter for the management of the Post Office, who are well aware that their future and the future of the service depend upon their continuing to deliver a service. That depends upon their ensuring not only that they have the right relationships with those who work in the Post Office but also that the service is run efficiently.
Lord Campbell of Alloway: My Lords, is my noble friend the Minister aware that by and large the public is far from satisfied with the quality of service which it receives from this monopoly? Would he be able to go a little further with regard to the nature of the review so as to consider whether the monopoly should continue without any form of no-strike clause?
Lord Young of Graffham: My Lords, I am well aware and my postbag provided ample evidence of the considerable public dissatisfaction with the quality of the service provided by the Post Office. Although expressions of dissatisfaction died down during the progress of the strike, since it ended my postbag has been full again. We are keeping the whole conduct of the business under continuing review. I think that we had better see how the service performs in the months to come.
Lord Molloy: My Lords, is the Minister aware that there was serious myopia on the part of management, who acted in an arrogant manner, and that the strike was not the fault of the unions? Is he also aware that if there had been consultations there might well not have been a strike? On behalf of all of us will he try to see the management of the Post Office to ask that in future when there are problems of this nature normal civilised British joint negotiations take place?
Lord Young of Graffham: My Lords, I suspect that the causes of the strike were far more complex than the noble Lord describes. I am very content to leave the management of the Post Office to the Post Office. It will be judged by the service it provides and we shall have to see what happens in the future.
Lord Williams of Elvel: My Lords, perhaps I may take this opportunity to correct an omission in my first supplementary question to the noble Lord; namely, to welcome the Clerk of the Parliaments back to the Table after his absence.
Can the noble Lord say what objective evidence there is that the public is dissatisfied with the service provided by the Post Office?
Lord Young of Graffham: My Lords, I suspect that the noble Lord does not receive the same postbag as I receive. If that postbag is any indication of the level of complaint on the part of the public, there is considerable public dissatisfaction with the service of the Post Office. It was of course occasioned by the strike. I have little doubt that the service will improve in the future, and that indeed is the business of the management of the Post Office.

Agricultural Research: Funding
2.55 p.m.
Lord Graham of Edmonton Lord Graham of Edmonton asked Her Majesty's Government:
What consultations have taken place on the proposals to cease funding "near industry" research projects, with particular reference to those concerning eggs and poultry.
The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington): My Lords, in June and July I held meetings with organisations representing the various sectors of agriculture, including eggs and poultry. Details of "near market" research were circulated in early August and discussions in depth took place at meetings with officials and researchers in late August.
Industry representatives will have a further opportunity to put their views to me at a meeting on 12th October. I have asked for a considered first response from industry by the end of October.
Lord Graham of Edmonton: My Lords, while I acknowledge with appreciation what the Minister said and what she wrote to me in a letter last week, perhaps I may ask whether she will acknowledge that there is deep unease in the industry at the time-scale which she has just outlined. Will she also bear in mind that only last month more than 40 organisations, led by the NFU, condemned that short time-scale as ludicrous in the circumstances?
Will the Minister also take on board the fact that while she and her Ministry are reducing the cost of R&D, Britain spends less on R&D than almost any other EC country? Is she aware that in Denmark they spend almost three times what we spend on pig meat alone? Will she agree that unless she revises the time-scale and purport of the inquiry there is a grave danger that the industry will not co-operate with her in what she intends to do?
Baroness Trumpington: My Lords, I am fully aware of the effect that uncertainty has on morale. That is one reason why we are pushing rapidly ahead with our consultation exercise. We are keeping ministry staff and AFRC fully informed of the progress of our consultations with industry and will inform them as soon as final decisions are reached.
With regard to competitiveness with the rest of Europe, it is difficult to make valid international comparisons of expenditure on R&D. However, it is firm government policy to avoid discrimination against UK agriculture.
Lord Carter: My Lords, is the Minister aware that one of the research projects identified as "near market" in the poultry section is the prevention of salmonella? In view of recent events in this House is she aware that some noble Lords feel that to include that area of research in potential cuts is near the bone rather than near the market?
Will the Minister also give an undertaking that once the quantum of agricultural research and development to be funded by the agriculture and food industries is decided the Government will give their full backing—including the use of existing statutory powers if necessary—to schemes which will enable the collection of required funds on an equitable basis from all sectors of the agriculture and food industries?
Baroness Trumpington: My Lords, the British Poultry Federation has been invited to all my meetings covering eggs and poultry R&D as well as

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to those meetings with officials. In addition, I met the chairman and director general of the federation on 13th July to discuss R&D. The reviewer, Mr. Barnes, has also met the federation while conducting his review. We fully recognise that industry needs to know what research has not been identified as "near market". At recent meetings we have sought to explain "near market" work in the context of the whole research programme. The Government remain committed to supporting the science base and providing a platform for future exploitation by industry.
Baroness Masham of Ilton: My Lords, following on from that question, perhaps I may ask the Minister how much research is being done on salmonella and eggs as cases of salmonella poisoning are increasing vastly.
Baroness Trumpington: My Lords, that is a little wide of the Question, which concerns the broad outline of "near market" research and R&D generally. I am quite sure that research is being carried out into the question of salmonella in eggs. If the noble Baroness wishes a precise answer I shall write to her.
Lord John-Mackie: My Lords, is the noble Baroness aware that in this era of tremendous change in the production, consumption, packaging and displaying of food this is not the time to upset research which is being carried out at present?
The Minister said that she was dealing purely with the question of "near market" research. Would she like to explain the term to the House? I am sure that a great many people do not know what it means.
Baroness Trumpington: My Lords, I believe that I have explained it several times before but I should be delighted to do so again. Broadly speaking, the term "near market" is taken to mean work which offers the prospect of commercial exploitation or application within a short enough time-scale to justify investment by industry.
Lord Graham of Edmonton: My Lords, will the Minister take on board the fact that the food processing industry has not been as fully consulted as other sectors of the industry? Will she also recognise that more than 60 per cent. of the MAFF-funded research at the Institute of Food is under threat? Will she also revise what she said concerning the safety of research into poultry, because my information suggests that the whole of the research regime relating to poultry is under threat?
Baroness Trumpington: My Lords, perhaps I may take first the last point concerning the level of cuts in research in the eggs and poultry sector. As the noble Lord will know, consultations are continuing and no final decisions have been reached. However, we have identified roughly between £1 million and £1.7 million of "near market" R&D in the eggs and poultry sector. That is a proportion of the total spend on eggs and poultry. Work affecting the public good,
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such as health, safety, animal welfare and environmental protection is not classified as "near market" and will continue to be a priority for government-funded R&D.
Lord Cledwyn of Penrhos: My Lords, in view of the fact that this is an extremely important and sensitive area, will the Minister say how the Government propose that the report and its findings will be made public? Will there be a White Paper or a statement in the House? Can she enlighten us on that matter, please?
Baroness Trumpington: My Lords, what has happened is that there has been a series of meetings with every sector in the agricultural industry, and, as I have already said, there will be more meetings. We have asked for first replies from each sector of the industry by the end of October. We shall go through those replies very carefully and Ministers will then make decisions. Those decisions will have to be made public and they will be fully publicised, but it would not be right for me to comment on whether or not there will be a White Paper. However, the decisions will be made public.
Lord Mackie of Benshie: My Lords, would the Minister like to tell the House whether any of the many bodies consulted have expressed sympathy with the Government's plans?
Baroness Trumpington: My Lords, did the noble Lord ask whether anybody had expressed sympathy with the Government's plans? If so, I have to reply that yes, they have. In many cases, people of intelligence equal to that of the noble Lord have said to me, "And about time too!"

Czechoslovakia: Trade
3.1 p.m.
Lord Dormand of Easington Lord Dormand of Easington asked Her Majesty's Government:
What action they are taking to increase trade with Czechoslovakia.
Lord Young of Graffham: My Lords, my department supports British chambers of commerce and trade associations in their joint venture exhibitions or business weeks in Czechoslovakia. Last month Sir Adrian Cadbury visited the Brno Engineering Fair on behalf of Her Majesty's Government. The Minister for Trade intends to visit Czechoslovakia next month, and we hope the Czechoslovak Deputy Prime Minister, Mr. Obzina, will visit the United Kingdom shortly.
Lord Dormand of Easington: My Lords, in spite of the encouraging Answer given by the Secretary of State, perhaps I may ask this question. Why is it so difficult—and in some cases impossible—for so many Czech businessmen to obtain visas to enter this country? is he aware that the presence of so many Germans and Japanese in that country indicates the scope for trade, and that this country is simply not taking advantage of it?
Lord Young of Graffham: My Lords, I am aware that the amount of our trade with Czechoslovakia is steadily increasing in both imports and exports. I fear that I cannot help the noble Lord with regard to the question of visas as that is not my departmental responsibility. However, I shall make the necessary inquiries of my colleagues.
Lord Williams of Elvel: My Lords, will the Minister confirm that there have been some problems with regard to language translation between Czech and English, and that the Department of Trade and Industry does not have sufficient facilities when Czechoslovak deputations come to this country? Can he comment on the situation? What are the facilities available?
Lord Young of GraffhamMy Lords, if the noble Lord tells me that we are unable to produce Czech translators then I must accept his remarks; although this is the first time that it has come to my notice. I shall certainly inquire about it.

Blasphemy Law: Policy
3.4 p.m.
Lord Boyd-Carpenter Lord Boyd-Carpenter asked Her Majesty's Government:
Whether they intend to introduce legislation to strengthen and make effective the law in respect of blasphemy.
The Minister of State, Home Office (Earl Ferrers): My Lords, the Government have no plans at present for altering the law relating to blasphemy.
Lord Boyd-Carpenter: My Lords, is my noble friend aware of the deep concern felt by many people at the announcement by the Attorney General that the present law on blasphemy is not strong enough to apply to the publication and use of a film made by an American film producer who is seeking to make money by publishing immensely offensive observations about the founder of the Christian faith?
Earl Ferrers: My Lords, it is perfectly true that there is concern. The position is that the Law Commission considered this matter and came to various conclusions which were not unanimous. We do not believe that there is a sufficient consensus of opinion to justify a change in the law. However, a number of people who are committed to the point of view which my noble friend takes have nevertheless considered that the film is a serious one. Many of those people felt that it was not blasphemous.
Lord Renton: My Lords, leaving aside the merits or otherwise of the film, does my noble friend acknowledge that we are primarily a Christian country with separately established Churches in different parts of the kingdom, and that the Queen is Defender of the Faith? Will he give an assurance that in this matter the Government will rise to the occasion and themselves be defenders of the faith?
Earl Ferrers: My Lords, the position is that one is concerned, as everyone is concerned, about the defence of the faith. However, there is also the consideration of the right of free speech and the curtailment of that right. When the Government come to suggest alterations for Parliament to consider, they have to take into account whether or not the right of free speech would be curtailed. Although many people take the view of my noble friend—and I have very much sympathy with it—it does not mean that those who made the film did not endeavour to portray something which they considered to be a serious matter. It is up to individuals to make up their own mind as to whether or not what was put in the film is offensive. That is an individual choice. It is not something upon which the Government themselves ought to make a prognosis.
Lord Harvington: My Lords, perhaps I may interject just one single word.
Noble Lords: Order! Question!
Lord Harvington: My Lords, I should like to ask the noble Earl whether he would agree with me that this is looked upon by countless numbers of our countrymen as a very serious blasphemy indeed and whether it is not up to us, as leaders of Christianity—which is what I believe a great many Members of this House to be—to do something about it. If we cannot do anything about it under the present legislation, ought we not to do something about it through new legislation? Will he further agree that this is a suitable matter to be brought up for debate within a very short time in order to make sure that Parliament takes seriously the fact that this country is still a Christian nation?
Earl Ferrers: My Lords, to answer that question, of course my noble friend is entitled to table any subject for debate. This may well be a suitable subject. I do not know; it is up to noble Lords to decide whether or not there should be a debate upon the matter. However, the serious content of my noble friend's Question relates to the delicate balance that has to be drawn between the right to freedom of expression and the need to protect from vilification the fundamental tenets of the Christian religion. I have not seen the film but I understand that even some of its critics have acknowledged that "The Last Temptation of Christ" is a serious film which raises serious theological issues. That is not my own view because I have not seen the film; that is merely what some people say about it. There is a measure of agreement among both legal and ecclesiastical opinion that the film is not blasphemous.
The Lord Bishop of St. Albans: My Lords, while not wishing to discuss the merits of the particular film, which in the course of my duties I had the tedious responsibility of watching through all its two hours and 40 minutes, will the Minister give some indication to the House as to the attitude of Her Majesty's Government to the report on blasphemy produced by the most reverend Primate the Archbishop of Canterbury through the working party of which I have the honour to be a member? We

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should be very interested to know whether Her Majesty's Government respond positively to these suggestions.
Earl Ferrers: My Lords, I am grateful to the right reverend Prelate the Bishop of St. Albans for the trouble he took in seeing this film and in putting forward the report of the working group of the Archbishop.
It is right to point out first that the report of the Law Commission did not reflect a unanimous view. Three members were in favour of abolishing the law of blasphemy; two were in favour of abolishing it but replacing it with something else. The Archbishop's working group—of which the right reverend Prelate was a member—decided to go along with the minority view of the Law Commission that the offence of blasphemy should be replaced with something else and that that should refer not only to the Christian religion but also to other religions. We are very grateful, but I am bound to tell the right reverend Prelate that there are difficulties with the definition of religion, and the absence of consensus among religious groups as to what should be done. For instance, one group, the Western Buddhist Order, indicated that it would not wish to be protected in this way. There are therefore difficulties, as the right reverend Prelate can probably see.
Lord Paget of Northampton: My Lords, is the noble Earl aware that historical experience almost everywhere tells us that once one starts strengthening the law against opinions, one starts strengthening the law against the people who hold those opinions and from there the step to burning heretics is not far? Is he also aware that our laws against blasphemy are a parcel of obsolescent nonsense which requires junking and that the sooner those laws are junked the better?
Earl Ferrers: My Lords, I thought for once that I was going to be able to go along with the noble Lord, Lord Paget, in what he was saying; that is, that the laws of blasphemy are very delicate; and on the right of freedom of speech, which the alteration of the law of blasphemy might curtail.
However, when the noble Lord says that they are a lot of old junk to be discarded, I do not agree, with the greatest of respect. Ten years ago there was an occasion when the noble Lord, Lord Willis, produced a Bill to abolish the law of blasphemy. I looked that up and found, much to my surprise, that I had participated in that debate. I had occasion to say:
"If one goes and stands outside Westminster Cathedral and shouts, 'To hell with the Pope' or, as Mr. Paisley did, calls him 'Old Mr. Red-Socks', people will not stick it and in the end one will receive a punch on the nose and cause a breach of the peace".—[Official Report,23/2/78; col. 295.]
That essential drift still remains. If one has no law of blasphemy one invites civil commotion.
Lord Soper: My Lords, in declaring an interest—which has tended to wane somewhat during the last five minutes—may I ask the Government whether they will distinguish in any deliberations on
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this matter between the establishment of a religion in a country like ours and the experience of Christianity, which are two very different things?
I ask the Minister whether he agrees with me that to call this a Christian country is an overstatement. If he had been in Hyde Park yesterday afternoon, as I was, I think he would have been reinforced in that conviction. I believe that the essence of blasphemy can only be justified in terms of a breach of the peace. Otherwise we shall do far better to establish some federation of controversy rather than the establishment of some doctrine that it is improper and illegal to cast doubts on the general propositions of the Christian faith.
In that regard I think that freedom of discussion, and a fellowship of controversy which does not prescribe these draconic conditions of blasphemy which have existed, is a far better way of contributing to the welfare not only of the Christian faith but of the civilised community in general.
Earl Ferrers: My Lords, the noble Lord, Lord Soper, asks a very deep and philosophical question to which I find it a trifle difficult to give a concise reply. However, of course there is a difference between the established Church or established Christianity and the experience of Christianity. The second ought to emulate the first. But he is quite right when he considers that there is a difficulty over the law of blasphemy and where the curtailment should come in.
In its judicial capacity your Lordships' House has held that the common law offence of blasphemous libel is committed in publishing concerning God or Christ, the Christian religion, the Bible or some sacred subject material which is scurrilous, abusive or offensive and which tends to vilify the Christian religion. But the decisions of the courts have always emphasised the strongly offensive character—and that is the important part—of the material. That must exist for publication to be criminal.
Baroness Masham of Ilton: My Lords, may I ask the Minister whether devil worship is on the increase?
Earl Ferrers: My Lords, I do not have the slightest idea whether that is blasphemous. I do not think it is. If the noble Baroness wishes to ask me a question on devil worship, I shall be happy to discover the answer, but I am not equipped to give it to her now.
Lord St. John of Fawsley: My Lords, does not this discussion show the wisdom of following the advice of Lord Melbourne, "Why can't you let the matter alone?"?
Earl Ferrers: My Lords, I am deeply grateful for that excellent piece of advice from my noble friend Lord St. John of Fawsley. I should be happy if your Lordships would agree to leave the matter alone.
Lord Elwyn-Jones: My Lords, is there not a certain danger that prosecutions for the crime of blasphemy could well stimulate further activities that the law was designed to protect?
Earl Ferrers: My Lords, there is always in some the desire to go as close to the wind as one possibly can so as to see how far one can go. One of the dangers of any kind of prosecution is that that could happen. There are always those who want to see if they can succeed in breaking the law; and if they do not then everyone wishes to see why they have not broken it. That is the danger of this particular case.
Lord Boyd-Carpenter: My Lords, is my noble friend aware of the fact that the film, to which reference has been made in several supplementary questions, is not an exercise in free speech but a deliberate attempt to raise money by publishing offensive observations about the founder of the Christian religion with the knowledge that they would be offensive and with no other motive than making money? Is he aware that many people feel that the law of blasphemy, which he has defended, is a pretty ineffective instrument if it cannot stop this?
Earl Ferrers: My Lords, my noble friend Lord Boyd-Carpenter gives your Lordships the benefit of his views, which I greatly respect. Had I seen the film, which I have not, I might have come to the same view. All I can tell your Lordships is that the British Board of Film Classification considered the matter in great detail, sought a wide range of views, and invited the senior representatives of the Christian Church to see the film. The president of the board, the noble Earl, Lord Harewood, and the vice-president saw it. The board took legal advice. The board's view was that the film was not blasphemous.
My noble friend wishes to alter the law on blasphemy. He will have observed from the discussions which your Lordships have had that that is a fairly controversial area. Even the Law Commission was not satisfied that there was unanimity of view. I think that we should proceed fairly cautiously.
Lord Hankey: My Lords, before we leave this Question, will the Government consider that if film companies, out to make huge profits, are allowed to put out films which give enormous offence concerning the heads of other religions, they could cause an immense amount of public trouble, particularly as regards the mixed communities which we now have in this country? Are the Government aware that that might also enormously damage our relations in the Middle East? Would it not be desirable for the Government to consider this Question again to make sure that things are not done which give prodigious offence on these religious matters?
Earl Ferrers: My Lords, the Government cannot decide what should be written, published or shown in a cinema. All the Government can do is to suggest to Parliament an alteration in the law. I have tried to explain to your Lordships, for reasons which the House will understand, that to alter the law at the moment might run us into more trouble than leaving it where it is. That does not mean to say that I do not have a great deal of sympathy with the views which have been expressed. The problem is difficult; the law
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exists and it is possible for prosecutions to occur in certain cases. It so happens that in this particular matter a prosecution looked likely to fail.

Petitions: Housing Bill
3.21 p.m.
Lord McIntosh of Haringey: My Lords, I beg leave to present a petition from the tenants, residents and workers of the London Borough of Hammersmith in the following terms. They believe that the proposals contained in the Housing Bill will, first, undermine the rights of council tenants, private tenants and housing association tenants and threaten their security of tenure; secondly, lead to exorbitant rent levels which will push rented housing out of the reach of those in greatest need; thirdly, do nothing to solve the crisis of homelessness or increase the supply of decent rented housing; and fourthly, threaten the jobs of local authority housing workers.
It may be for the convenience of the House, and entirely in accordance with Standing Order No. 70, if I say that I have three boxes of similar petitions from council tenants with which I shall not weary the House by presenting individually.
Petition presented.
Lord Jenkins of Putney: My Lords, I beg to present a petition from 1,871 residents of Wandsworth which prays that this House will reject or amend the Housing Bill which I think they regard as blasphemous in its present form.
Petition presented.

St. George's Hill, Weybridge, Estate Bill
3.23 p.m.
Read a second time, and committed to a Select Committee.

Harwich Parkeston Quay Bill
Read a third time, and passed, and returned to the Commons with amendments.

Bristol Development Corporation (Area and Constitution) Order 1988: Select Committee
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move the first Motion standing in my name on the Order Paper.
Moved, That the Lord Elibank be appointed a member of the Select Committee on the Bristol Development Corporation (Area and Constitution) Order 1988 in the place of the Lord Brougham and Vaux, resigned.—(The Chairman of Committees.)
On Question, Motion agreed to.

House of Lords Offices: Select Committee
3.24 p.m.
The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That the Fifth Report from the Select Committee (HL Paper 101) be agreed to.—(The Chairman of Committees.)
The Report was as follows:
The Committee have met and been attended by the Clerk Assistant and the Gentleman Usher of the Black Rod.
1.Sub-Committees
The Committee approved the appointment of Lord Walston to the Administration and Finance Sub-Committees in place of Baroness Stedman.
2.Library
A report from the Library Sub-Committee for 1987 was laid before the Committee.
3.Refreshment Department
The Committee received a report from the Refreshment Department Sub-Committee concerning the outbreak of food poisoning in May 1988; and took note with approval of the sub-Committee's proposals for redesigning and extending the kitchen and dining areas.
The Committee also approved a statement of Accounts for the Financial year 1987–88.
4.Staff of the House
A report by the Chairman was made to the Committee who agreed to:

(i) the provision of a contribution to the House of Commons towards the cost of the shared post of Welfare Officer;

(ii) the creation of additional posts of clerical officer for the Printed Paper Office and part-time cleaner for new rooms provided for the Accountant's and Establishment Offices:

(iii) the regrading of one higher executive officer in the Parliament Office to senior executive officer. the replacement of one executive officer post in the Library by an additional Assistant Librarian; and

(iv) upgrading, on a personal basis, of one senior clerical officer post in the Hansard Office to executive officer and one executive officer in the Record Office Sound Archive to audio technician.

The Committee also authorised the payment of a proficiency allowance to a clerical officer in the Committee Office.
5.Security
The Committee approved an increase in the complement of the security force.
6.Parliament Office
The Committee were informed of the appointment of Mrs. F. Martin as Chief Clerk.
7.Internal Audit
The Committee were informed of the appointment of Mr. A. A. Cameron as Internal Auditor.
8.Conferences
The Committee approved that provision be made in the House of Lords' Vote to meet:

(i) a share of the cost of the 10th anniversary meeting of the European Centre for Parliamentary Research and Documentation to he held in London in 1989; and

(ii) a share of the travel costs of a visit by a Deputy Speaker to Leon in Spain to celebrate the 800th anniversary of the Cortes of Castile and Leon.

9.Revised Scales of Pay and Allowances
The Committee confirmed the application of the following Civil Service memoranda to staff of the House of Lords:

DEO letter dated 26.2.88 (Special Pay Additions)

DEO letter dated 17.3.88 (Local Pay Additions)

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DEO letter dated 14.6.88 (Pay of Legal Staff, etc)

CM/835 Pay of Office Support Grades)

CM/838 (Pay of Senior Open Structure)

CM/840 (Pay of Grades 5, 6 and 7)

CM/842 (Pay of Administration Staff below Grade 7)

CM/843 (London Weighting).

10. Hansard Reporting Staff
The Committee approved payment of a revised scale of charges for the supply of agency typists.
11. Superannuation
The Committee were notified of the following awards made under the House of Lords. Staff Pension Scheme:

(a) Pension and lump sum to Mr. J. E. Grey, CB, Clerk Assistant, who retired on 1st April 1988.

(b) Revised pension and lump sum to Mr. P. M. Eglinton, Senior Reporter, who retired on 1st February 1988.

(c) Revised pension and lump sum to Mr. A. M. Daws, Senior Reporter, who retired on 1st February 1988.

(d) Pension and lump sum to Mr. K. W. Haywood, Senior Clerical Officer, who retired on 9th April 1988.

(e) Revised Pension and lump sum to Mrs. F. Dunn, BEM. Head Housemaid, who retired on 23rd April 1988.

(f) Pension and lump sum to Mrs. D. V. R. Sharp, Cleaner, who retired on 26th March 1988.

(g) Pension and lump sum to Mrs. P. Arnold, Cleaner, who retired on 7th May 1988.

(h) Pension and lump sum to Mrs. A. M. Ames, General Assistant, who retired on 1st April 1988.

(i) Pension and lump sum to Mrs. M. M. Curniffe, General Assistant, who retired on ill-health grounds, on 2nd April 1988.

(j) Preserved pension and lump sum to Mrs. E. P. O'Connell, Supervisor of Typists. who resigned on 30th September 1987.

(k) Short service payment to Miss C. M. Henry, Bar Assistant, who resigned on 1st April 1988.

On Question, Motion agreed to.

Housing Bill
3.25 p.m.
The Minister of State, Department of the Environment (The Earl of Caithness): 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.—(The Earl of Caithness.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ABERDARE in the Chair.]
Clause 92 [Right conferred by Part IV]:
The Chairman of Committees: In calling Amendment No. 125F, I have to inform the Committee that if this amendment is agreed to I cannot call Amendments Nos. 125G or 125H.
[Amendment No. 125F not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 125G:
Page 69, line II, after ("person") insert ("(a)").
The noble Lord said: In debating Amendment No. 125G—and as usual I shall treat this with ponderous care to allow those noble Lords who do not wish to take part in the debate to leave quietly—we are moving to perhaps the most important single part of this important and complex Bill. We are concerned with the issue which the Government, in their own

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proposals, dignified with the name "tenant's choice-. In Amendments Nos. 125G, 125H and 136D, which are to he debated with this amendment, we are challenging the whole claim that the Government are making that this is anything whatever to do with tenant's choice.
We seek to convince the Committee, as most council tenants throughout the country are already convinced, that, as presented by the Government, this is an issue of landlord's choice and not of tenant's choice. All of the democratic safeguards which are commonly found concerning the livelihood, the security of tenure and the rents paid by council tenants, are put at risk, and are to be thrown into the melting pot. They ought not to be treated in the cavalier way in which they are treated in the Bill.
The essence of the argument which we must face today is as follows. The Government are saying that when a proposal comes to a local authority from some other putative landlord (whether it be a private landlord, a housing association or any other type of non-local authority landlord) in order for that change of landlord to go through it is sufficient for a minority of the tenants to approve of such a change. However, it is necessary, in order for it to be prevented, that a majority of all eligible tenants vote against it—including those who do not vote or who are unable to do so. In other words as the National Consumer Council has said very succinctly what we are dealing with is a form of inertia selling.
I give the Committee a couple of examples of the way in which that might work. Let us suppose that we have an estate of 100 houses. A putative landlord says to the local authority that he wants to exercise his rights under Part IV of the Housing Act 1988. Some 30 of the 100 tenants on that estate agree that they would like to go along with that suggestion. Let us say that 49 per cent. agree that they want to stay with the local authority as the landlord. I will explain in a moment why, surprising as it may seem to those who hear horror stories about local authorities as landlords, there may be very good reasons why tenants would wish to stay with local authorities. The remainder of the tenants on the estate for one reason or another do not vote.
What could the reasons be for not voting? They could be that between the date of the first application and the date of the vote such tenants have moved away, are no longer interested or concerned with the vote. The tenant may be old, sick or disabled and therefore unable to register a vote. From the profile of council tenants in this country, it can be seen that there could be a substantial number of such cases. The tenant may speak a foreign language and not English and does not understand the issue. The tenant could be away on holiday or business at the time when the issue comes to be decided. Whatever the reason may be and however valid the reason for not voting, in order for the putative landlord to achieve agreement to the transfer of the property it would be sufficient if he secures that not more than 50 per cent. positively vote against the transfer of tenancy. That is not merely a denial of democracy, as was agreed by the Committee as recently as July when considering the question of housing action trusts (at
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that time it was agreed that a majority of tenants eligible must vote for the creation of a housing action trust for it to take place) but it is in conflict with all government legislation of which I am aware.
The Housing (Scotland) Bill, which is going through the House at present allows an application to be made for the transfer of tenancy only with the written consent of tenants. The Education Reform Act, which is concerned with the transfer of schools from local authority-controlled to grant-maintained status, requires a majority of parents to agree to that transfer in order that it can take place. A further safeguard is provided whereby a majority votes. If less that 50 per cent. take part in the ballot, a further ballot must take place within 14 days.
All of the many trade union Acts which have seen their passage though your Lordships' House in recent years have been based on the principle of majority voting. In other words, for something to take place a majority must be in favour of it. That is the simplest numerical, mathematical and arithmetical definition of democracy that one can envisage. Yet, for some reason—and we must explore why— the Government are departing from that principle in order to give putative landlords the right to take away from local authorities the control of housing estates even when more of the tenants in those estates vote to stay with the local authority than vote to move.
A moment ago I said that the general image of local authorities is not very good. There is a lot of truth in that. It is true that. in general, large authorities which deal with a mixture of properties, many of which are old, decrepit and in need of substantial investment to put them into decent order—investment which is very difficult for them to obtain—fall down on their duties as landlords. There is no doubt about that. The tenants who arc protesting to us about that particular element in the Bill are afraid that, however defective their relationship may be with the local authority as landlord, the move into the non-local authority sector—be it the private or housing association sector—will put them at risk in two important and vital ways. First, it will put at risk their controlled rents. They will run the risk that when they move out of their particular dwelling, or change a landlord, they may find themselves with what is laughingly called an "assured tenancy". In reality it is nothing of the kind; it is an unassured tenancy. It will mean that their rent will be increased to a market level rather than be at the level to which they have been accustomed. Secondly, they are afraid that the change will weaken their security of tenure.
Members of the Committee who, like me, have the advantage of being owner occupiers, ought not to underestimate the strength of feeling, indeed passion, for security of tenure among those who are not owner occupiers. They wish to be sure that, unless they fall down on their payments or for some other reason, they will not be at risk of being thrown out in the street and at the mercy of any landlord, whether from the public or private sector. If we are owner occupiers who have, by definition, security of tenure so long as we keep up with our mortgage payments, it would ill become us to weaken the security of tenure of those who do not have our advantage as owner occupiers.

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I am aware that a number of my noble friends who are not owner occupiers will say that with great force because I know that they feel as strongly as I about the issue.
We find ourselves in the extraordinary position where in respect of every other item of legislation put forward by this and previous governments it has been accepted that the will of the majority of those eligible to vote, or at least the majority of those voting, should be taken into account when considering a major change to the livelihood and quality of life of the people of this country; in this case our council tenants. For some reason which is incomprehensible to those who have heard the argument so far, the Government have turned the argument on its head. They have produced a system of voting which makes it far easier for a minority to hold sway over a majority and make it inevitable that those who do not have the opportunity to vote at any particular time will be counted in a way which does not consult their own interests or opinions.
In consonance with the decision which the Committee made about housing action trusts in July of this year, and in consonance with all the principles which were enunciated when considering comparable legislation on many subjects, including housing, I ask the Committee to approve these amendments and to return the state of the law to where it ought to be: a state which recognises the principles of democracy. I beg to move.
3.30 p.m.
Lord Campbell of Alloway: I should like to say a brief word in opposition to these amendments. I shall take the two main points made by the noble Lord, Lord McIntosh of Haringey, and respectfully seek to try to answer them. The first point is the majority voting procedure and the second is the fact that tenants are apprehensive about the risks to their security of tenure.
If I understand the machinery of the Bill correctly, on analysis neither objection is valid. The proof of consideration is that the choice always belongs to the tenants. It gives as many secure council tenants as possible the right to seek a new landlord if they so wish—that is, a new landlord approved by the Housing Corporation who will be obliged in terms to honour the tenants' guarantees. There will be formal consultations with tenants who will be balloted under the supervision of an independent teller.
In those circumstances, as I understand it, the scheme can go ahead only if supported by a majority. However, if the transfer proceeds, no individual secure tanant who wishes to stay with the council can be compelled to transfer against his will. If, on objective analysis, that is a true interpretation of the Bill, where is the objection? Where is it founded against the majority voting procedure? On patient if somewhat laborious analysis there is no question of the home being sold over the tenant's head.
I agree with the noble Lord that this is a serious matter. I agree that housing—and in particular rented council accommodation—is a question of
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prime importance to a great mass of our people. Irrespective of any political affiliation or none, those people are tied to councils. Again I agree with the noble Lord in that some of those councils fail patently and miserably to discharge their duties to tenants in that regard. The state of repair of much council accommodation is a sheer disgrace. Statistics are not interesting; but, as the Committee well knows, there is much vacant council accommodation which could be put on the market for better use.
The new assured tenancies under Part I of the Bill will confer long-term security of tenure. That brings me to the noble Lord's second point. I respectfully suggest, on analysis, that that is not well-founded because they will confer long-term security of tenure at rent levels which, as I understand this fairly complex matter, have to be offered before the balloting process takes place. In any event, housing benefit will be available for those who qualify, as before.
If I have fairly met the noble Lord's objections, then why should a great mass of our people be saddled with councils as landlords if such is not their wish?
Lord Ross of Newport: I wish the case was as put by the noble Lord who has just sat down. All that we are asking for in these amendments is that the majority of those who are eligible to vote should be clearly seen to vote and vote in favour of change. There should be a majority of at least 51 per cent. of all those eligible to vote before a change takes place.
In speaking to Amendment No. 136D, we are concerned that as this Bill proceeds without amendment it is quite clear that some tenants will have their homes transferred over their heads. I suggest that that would be extremely serious. The transfer would be irreversible. They would have no choice. They would lose statutory tenants' rights, and the new landlord may charge rents which they can ill-afford for services that they do not want. That is happening already; therefore let us not say it is not going to happen. The North British Housing Association purchased all the ex-GLC properties from the Residuary Body. Some 100 or more of those properties are in my part of the world in the Isle of Wight. Already they are seeking to register rents with the rent officer with an increase of something like £11 per week. Tenants had a £2 per week increase just over a year ago. We are now talking in terms of rents of around £30 per week. Rates are paid in addition to that in these cases. They are also trying to change the terms of those agreements, so it is actually happening.
Tenants are concerned, and naturally so. In that instance they were consulted when the sale took place. We are seeking to have everything fully explained to them. We know that a number of local authorities wish to sell their housing stock. We also know—and perhaps we shall be updated by the Minister when he replies—that there are problems over that matter. The Charity Commissioners have expressed anxieties about sales to charitable housing associations. Perhaps we shall receive some information on that matter before the Bill leaves Committee.

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Some of the bigger housing associations are now getting very big indeed, and they are getting pretty aggressive. I think that they will be the private landlords of the future. I think it is important that local councils should consult with their tenants. Not all local councils are doing so. They do not have an obligation to do so at the moment, and they are not necessarily doing so. Other councils of all parties are quite rightly doing so and are telling the tenants exactly what they have in mind for the future; whether they intend to form housing associations themselves or whether they are going to seek a takeover by a local housing association or possibly outside landlords.
I think that it is important that all tenants should be fully consulted, and then there should be a vote. Too many of our fellow-countrymen do not follow what is going on half the time, and they do not take an interest if something comes through the door on a voting procedure. They do not take it up and do not bother to vote. Therefore we have this nonsense that they are automatically said to have voted in favour of the change. We are seeking that there will be a clear majority of the tenants of that estate voting, and voting in favour of the change. It is as simple as that.
The Government conceded in the education Bill that there should perhaps be a second poll. I hope to goodness that they are going to concede that in this instance. It is surely only democratic that they should do so.
3.45 p.m.
Lord Renton: Quite apart from the merits of the detail which have been well-argued by my noble friend Lord Campbell of Alloway, I should particularly regret the passing of the first of these amendments on the Marshalled List because it would remove from the Bill words which plainly declare the intention of Parliament regarding this part of the Bill. Some of us spend some time clamouring for the intention of Parliament to be clearly stated; and here we have it most beautifully clearly stated. However, the noble Lord on the Opposition side wants those words to be left out. That would be very regrettable.
I should like to invite the Committee's attention to what the noble Lord proposes to leave out. He is letting the first line stand:
"This Part has effect for the purpose of conferring on any person"
The noble Lord wants to leave out:
"a person who has been approved under section 93 below the right to acquire from a public sector landlord."
Lord McIntosh of Haringey: Amendment No. 125F to which the noble Lord appears to be speaking was not moved. I am speaking to amendment Nos. 125G, 125H and 136B.
Lord Renton: I apologise to the noble Lord. Perhaps I may congratulate him on allowing those words to stand. The fact that they are to be allowed to stand indicates that there seems to be no difference between us as to the main purpose of Part IV of the Bill. So be it.
Lord McIntosh of Haringey: I shall not respond in detail to the noble Lord's attempt to put words into my mouth; but I shall have a later opportunity to do so. I think it would be convenient for the Committee if we did not go backwards and forwards on each item as it is raised.
Lord Stallard: I intervene briefly mainly to ask a question of the noble Lord, Lord Ross. Can the noble Lord give some indication of the Government's thinking? I find it extremely difficult to believe that they have waited until this moment to give us any information on the question of Charity Commissioners' reports and statements recently published. I do not know whether the Minister saw the report in the Independent newspaper of Friday 7th October. It stated:
"The Charity Commission has warned the Department of the Environment that housing associations, which have charitable status, would be precluded from taking over large amounts of council housing because this would not be considered as a charitable act. Since 80 per cent. of housing association stock is owned by associations with charitable status, ministers are urgently trying to find a way round the problem to prevent pick-a-landlord or tenant's choice from becoming a lame duck".
If the Charity Commissioners' report is upheld, then we ought to be looking at a different Bill entirely. If the housing associations cannot take over the local authority stock, then who will? As I understand it, the whole ethos of the Government's intentions was to transfer the bulk of council housing over to housing associations. I understand that any tenant could challenge the validity of the taking over by a housing association of estates. If that is not going to be legally possible, we ought to he discussing that situation before we go into the details of the tenants' choice. I hope that the Minister will be able to give us that kind of reply before we proceed any further with some of the more important points which have been raised.
I should like to make one very brief point on the contribution by the noble Lord, Lord Campbell of Alloway. He said that people were "tied to councils", and later he said that they were "saddled with councils". I feel very strongly about this. Most of us here have been involved in one way or another with tenants, with local authorities, with voting procedures and with the whole democratic process. We think we understand it far better than those who may not have been involved in any of those aspects of life. I can tell the noble Lord that there are thousands and thousands of people who opted to be "saddled", as the noble Lord said, with councils, rather than be saddled with Rachman or with any other private landlords.
Perhaps I may say that the whole emphasis as regards the contribution of the noble Lord, Lord Campbell, was that these people who are tied to councils now want to be rid of them. That is not true, as is shown by the petitions which are coming in here every day—we have all had petitions; I have handed in petitions—from thousands of people up and down the country who are opting to stay with the councils. They want to be saddled with the councils because they know the alternatives. I hope that the Minister will reply to me on one of the alternatives; namely, the housing associations. If they are now going to be

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illegal it makes the alternative even more frightening than appears as the Bill stands.
Lord Campbell of Alloway: Perhaps I may just answer the noble Lord as we are in Committee. This business of saddling, which is the term I used, means that if they do not want to be saddled with the council then they do not have to be; but if they do, as the noble Lord, Lord Stallard, says, then they can remain with the saddle. I cannot see that the noble Lord is meeting the substance of the problem.
Lord Stallard: I can understand that the noble Lord cannot see the point. I said that. There are a number of people who cannot understand what the Bill is about and why tenants should be worried about it. I accept that. There are people who do not understand how or where council tenants live and how they feel.
Another aspect of this saddling procedure is that they are saddled and landlords now have a vested interest in interfering with the voting procedure. It would be to the landlords' advantage to obtain as many abstentions as possible. Therefore the whole procedure is open to all sorts of unscrupulous dealings. Do not tell me that landlords have never been unscrupulous in their attempts to get their hands on property. Those are real fears. I suggest that Members of the Committee opposite should give deeper consideration to council tenants and where they live.
Lord Stoddart of Swindon: I have listened to the debate so far and, in particular, to the remarks of my noble friend and also the remarks of the noble Lord, Lord Campbell of Alloway, in relation to councils and the way in which they administer their estates.
I have a background in local government and service in another place. Certainly as a councillor, as a chairman of a housing committee and indeed as a Member of Parliament I received many complaints. I received many complaints about my councils. I also received many complaints about private landlords. There was one difference; namely, that I could do something about complaints about the council administration but invariably I could do nothing about complaints about the private landlord.
Therein lies the difference. Local authority tenants have some public redress. Private tenants have no public redress. That is why many tenants—indeed, the majority of tenants—do not want to transfer from an organisation over which they have some say and control to an organisation or private individual over whom they can have no control or influence. That is the difference between the two forms of tenure.
Lord Harmar-Nicholls: Will the noble Lord tell me what he could do as a Member of Parliament to a council which he could not do to a private landlord?
Lord Stoddart of Swindon: I found that if ever I wrote to the chairman of a housing committee or indeed to the housing manager, action followed very quickly indeed.
Noble Lords: Oh!
Lord Stoddart of Swindon: It may very well be that the noble Lord has a different experience, but we are different people who are perhaps able to have differing influence on different people. However, that is by the by. I am sure the noble Lord would agree that housing under public control is amenable to pressure from public representatives.
Perhaps I may make the further point that I find it most remarkable that a Conservative Government would wish to interfere with normal voting practices. One criticism which I have never particularly made about the Conservative Party is that it wishes to undermine established constitutional practice. I always believed that the Conservative Party was there to uphold normal, understood and well-practised constitutional principles.
However, it seems that things have changed. First, they have changed in relation to legislation on trade unions where, in order to maintain a closed shop, there has to be an 80 per cent. vote in favour. I disagreed profoundly with that and I thought that it was most unfair. We now have a situation where the "don't knows" or perhaps even "don't cares" are going to be added to the "Ayes". I find that very strange. Indeed, if it was practised in normal elections we would have a very peculiar situation. For example, let us suppose that all the "don't knows" were added to the incumbent Member of Parliament. Those already in power would have a very long lease of life.
However, there is another instance which comes to my mind. I was a Whip in another place when we had the referendum in Scotland on devolution. If that system had applied in relation to the referendum for devolution in Scotland, Scotland would now be devolved although the majority of "noes" and "don't knows" were against it. I hope that the Minister will take those matters into account about the desirability of introducing alien, unsatisfactory and unacceptable voting procedures into any part of our national life.
Lord Bottomley: My noble friend Lord Stallard referred to petitions. I am sure that many have been presented to Members of this Committee. About an hour ago I was called out by 50 people from Middlesbrough—my old parliamentary constituency—who said that the tenants there felt very strongly and they had been sent down specially to let me know. In so doing, they asked me to let Members of the Committee know their feelings. They presented a petition. I am sure that my experience is shared by many other Members of the Committee and I hope that the amendment of the noble Lord, Lord McIntosh, will be accepted.
Lord Callaghan of Cardiff. I believe that this is not only a very serious matter but one in which the Government are failing to take into account both the history of landlord and tenant and the experience of a great many people. In a way, we are all dogged by our experience of these matters. For myself, I never lived in a house which I could call my own, subject to a building society, for about the first 30 years of my life. However, it is not my personal experience with which I am concerned.

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I say to Members of the Committee of all parties—and it may be that the Government are going to carry this—that/to/interfere, in any way, to appear to interfere or to give an apprehension to people about the security of the homes in which they live is one of the worst things that can be done to them. Without any propaganda from anybody in particular, this Bill is causing a great deal of anxiety. I believe—I hope that Members of the Committee opposite may still consider this—that it would be better to require a positive majority of people in favour of a change of ownership. If that is not done, I can see a tremendous amount of trouble coming.
I take an elitist view on this matter, and I am not sure what support I shall get from the Committee as a whole. In my 42 years as a Member of Parliament I had what is called a working-class constituency. I represented an area containing people who were never likely to get a job even with full employment. I believe that we have a responsibility for such people. They are not the people who will go to vote. To reply to the noble Lord opposite, they will not even bother to say that they want to stay under the council. They are the people who are of such a character—the Committee may accuse me of elitism—that they are not fully able to look after their own lives.
I have seen a number of people who drift into petty crime not because they are criminals in the sense that we all understand the word but because they are incapable of managing their affairs in any way. I fear that those are the people who will suffer. Those are the people who, in the end, society will find we have pushed out of the general consensus that we have in this country. Therefore I speak for those people.
I believe that they are a minority, and of course the Government are right to say that we must teach people to be responsible for their own affairs. We are all responsible for our own affairs and Members of this Committee are quite capable of doing so. However, there is a section of our society which is not yet able to do that. That situation has existed during my lifetime as a Member of Parliament. Therefore I shall vote for these amendments because that is the best way of protecting such people.
Lord Renton: Before the noble Lord sits down, has he borne in mind, in making those interesting remarks, that this part of the Bill applies only to secure tenants?
4 p.m.
The Earl of Caithness: It would be helpful if I prefaced my response to this, our first debate in Committee on Part IV of the Bill, with some general remarks about the general objections to what has become known colloquially as tenants' choice.
Well before introducing these provisions we featured tenants' choice prominently in our election manifesto. We sought and obtained a mandate for council tenants to be able to ask other institutions to take over their housing, but we promised that tenants who wish to remain with the local authority will be able to do so. That is clear in the Bill.
The proposal arose out of problems which are all too obvious in some, I agree not all, of the council
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housing stock. Many councils have virtual monopolies of rented housing in their areas. By no means always but too often, these large stocks are badly run. This has been possible in the past largely because council housing has been a closed world to which tenants have been unable to choose an alternative. We believe that these stocks require the spur of competition to promote better services for tenants, whether through transfer under this part of the Bill to a new landlord or, in the case of those tenants who remain with public sector landlords, by the beneficial effects of competition on their operations.
The mere threat of our proposals and policies in this Bill has already led to an improvement in council house management. One has seen it regularly in reports. I saw a report recently concerning Birmingham—the noble Baroness, Lady Fisher of Rednal, will no doubt have seen it—where the council house authorities are taking a new attitude to their tenants and looking after them as customers. That is to be welcomed. That situation has arisen solely because of the provisions included in this Bill.
We are in something of a dilemma with these amendments. The noble Lord, Lord McIntosh of Haringey, sought to link Amendment No. 136D with Amendments No. 125G and 125H, although there is no connection between the last amendment and the first two. That takes us into another area—the whole question of voting—which the Committee will know from reference to the Marshalled List embraces other amendments which are not grouped with these. I refer to Amendments Nos. 132ZC and 136C in the name of the noble Lord, Lord Ross, and Amendments Nos. 135D, 135E and 136F. All those amendments deal with voting. I had hoped that we would either lump all of them together or deal with Amendments Nos. 125G and 125H by themselves and deal with Amendment No. 136D when we came to vote. The Committee is therefore having, as it were, a split debate.
It would be wrong for me not to answer the debate in general that we have had on the voting system. I first deal with Amendments Nos. 125G and 125H. This was a device that the noble Lord, Lord McIntosh, brought into the Marshalled List in order to bring forward the debate. They are a simple reference forward to the fact that the right under Clause 92 is subject to the majority provision in Clause 102(2). But that is already clear from the reference in Clause 92(1):
"subject to and in accordance with the provisions of this Part".
Therefore Amendments Nos. 125G and 125H add nothing. Needless to say, Amendment No. 136D adds a considerable amount, as do the other amendments which are not being discussed now.
However, there is one matter in the area we are discussing on which we are at one. The procedures to allow tenants affected by a proposed transfer to affect its outcome and the future of their own tenancies if it goes ahead are at the very heart of tenants' choice and Part IV. I know that many people in this Chamber, and elsewhere, are concerned about the majority requirement under Clause 102. I hope I can reassure them and the Committee that, although later this

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evening we shall discuss further, more technical amendments that stand in my name, the principle of the provision in the Bill distributes the onus of proof reasonably as between the opponents and the proponents of change among the tenants affected. It is underpinned by arrangements which safeguard fully the interests of individuals and is duly precedented.
Perhaps I may say to the noble Lords, Lord Stallard and Lord Callaghan, that the prime safeguard for the interests of the individuals is that no secure tenant who does not wish to transfer can be obliged to do so against his or her will. We need to bear that individual safeguard clearly in mind when considering how the outcome of an application as a whole is collectively decided by the tenants. As for the collective decision, the system of landlord approval together with the proposed informal preliminary competition between the prospective landlords which the Housing Corporation will run will ensure that applications are likely in the first place to be pursued only where there is a significant body of collective support among tenants for the change. That is the first point. There must be evidence that a large number of tenants want to change.
Applicants will also be required, as a condition of their approval to take part in the scheme, to keep tenants informed about the application and its progress. In addition, regulations governing consultation under Clause 101 will ensure that tenants are given both full and understandable information about the process itself and a contractually binding and comprehensive offer of new tenancy terms. Moreover, the ballot itself will be run by an independent teller, such as the Electoral Reform Society, paid for by the applicant, who will be able to chase up any tenant entitled to vote who does not initially do so and assist him to register a view.
Perhaps I may dwell on that aspect for one moment. This is not a ballot that takes place on one day. We envisage a period of about 13 weeks or so in which the first part will be the period in which the information will be given by the applicant and by the landlord—the local authority. The tenant will therefore receive both views. There will then be a period of about three weeks in which the voting takes place. Therefore it does not take place on one day but over a period of time. Consequently the very tenants whom the noble Lord, Lord McIntosh of Haringey, is concerned about will have the opportunity to be consulted, can be chased up by the Electoral Reform Society and will therefore have little excuse to say that they did not know or have the opportunity to vote. If a tenant misses the opportunity on one day, there will be a further opportunity. By the time the vote is reached it is difficult to envisage any normal circumstances in which tenants have not had both the information and the opportunity to register a view if they have one.
In those circumstances, and remembering the availability of the individual opting out, it is surely reasonable not to allow the abstention of those who do not feel strongly enough, after all the information
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and explanation I have described, to vote about whether they want a transfer to deny much-needed change to other tenants who may desperately want it.
Baroness Seear: I am grateful to the noble Earl for giving way. On a point of information, I believe he said that tenants would be chased up by the Electoral Reform Society. That seems to me to be very odd. Surely the Electoral Reform Society, as the impartial handler of the vote, would not be in a position to chase up voters. I very much doubt whether it has the staff to chase up voters. Is what the noble Earl said really correct?
The Earl of Caithness: Yes, indeed. This is the point that has perhaps not been understood. The Electoral Reform Society will be paid by the applicant to record the votes. There will be a period over which the voting takes place. If the tenants in a particular flat or house, or the tenants in that area, have not voted, it will be for the Electoral Reform Society to go to those tenants and say "You have the opportunity to vote and would you like to vote?" It will be up to the applicant and the landlord to put before the tenant the choices available to him.
The majority provision in Clause 102 facilitates transfer for those who want it while allowing individual safeguards for those who do not. In our view this is a perfectly right and fair approach. We have heard suggestions that some tenants might be transferred against their will through ignorance or inadvertence. I do not believe that those suggestions ring true.
Lord Stallard: Perhaps I may raise a point on the role of the Electoral Reform Society because it seems that we are just glibly passing over the matter. It would appear that the Electoral Reform Society is now working for the landlords or for the applicants. Its representatives will go and see the tenants, canvass them and collect the votes on behalf of the applicant. I point out to the noble Earl that there are cases at present where landlords have started canvassing applicants. There is already pressure being put upon tenants to abstain or not to vote or to vote the way they do. How will those same applicants or landlords employ the Electoral Reform Society and what will he the employment relationship between the society and the landlords? Why have not the tenants access to the same organisations?
The Earl of Caithness: If I can help the noble Lord further I shall try. The point is that the independent tellers—I quoted the example of the Electoral Reform Society—will be independent of the applicant or the landlord. Their duty will be to collect and record the votes in an independent way. They will also have the opportunity to go to tenants, because it is phased over a period of time, to say "You realise a vote is going on and this is your opportunity to vote." That is why it is a different process from what I believe the noble Lord thought before I had a chance to explain it to him.
Lord Mayhew: I speak as a very old member and supporter of the Electoral Reform Society. Is the

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noble Earl telling us that this detail has been agreed with the society? Is he aware that even if the society made the surely grave mistake of agreeing to this procedure, it is out of court and quite wrong? One does not want the Electoral Reform Society doing what is called "knocking up".
The Earl of Caithness: As I understand it, the Electoral Reform Society has agreed to it and whether or not it is against the noble Lord's best judgment that is the situation. We believe that is the fairest way and that is why we believe that this phased voting system with that ability gives every tenant the opportunity.
Baroness Fisher of Rednal: Does the noble Earl agree that if a group of persons living in the area did their own canvassing—it might be the tenants themselves who went around, having formed their committee, and canvassed to get their own conclusions—the result might be not to go to a private landlord? Would that be equal to what the Electoral Reform Society would be doing? It is important that both sides should have the option of voting on the basis of the way in which the case is presented to them. In the same way in any election the Conservatives, the Liberals and the Labour Party come knocking on the door and one makes a choice afterwards. Although it is important that the Government will be setting up schemes in the New Year to fund groups that will be putting over the case for the landlord, it is also important that the tenants should be able to carry out their own ballot and to present that as their findings.
4.15 p.m.
The Earl of Caithness: I thoroughly agree with the noble Baroness that it is absolutely vital that both sides put their case. All I was saying about the independent tellers was that they have the opportunity to go back to someone who has not voted and say "There is a vote going on and now is your chance to vote". It is not up to them to put the case for the applicant or the landlord. I very much hope that some of the tenants that the noble Baroness spoke about will get together and form tenants cooperatives and become suitable proposed landlords for the housing corporations.
Lord Parry: The noble Earl caught so many of us by surprise despite the nationwide concern that has been shown over this issue for months. Did he tell us that the Electoral Reform Society would be paid to carry out this work? By whom will it be paid, what are the funding arrangements and how much will it all cost?
The Earl of Caithness: Yes, it will be paid. The applicant will be responsible for the cost of the independent teller.
Lord Stoddart of Swindon: I can hardly find words to express what I feel about this. Is the noble Earl absolutely sure that the Electoral Reform Society, which is concerned with fair representation and fair methods of voting, has actually agreed to this system and also agreed to operate it on behalf of landlords
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or the Government or whoever it may be? I am sure that the noble Earl is telling the truth as he sees it, but Members on this side of the Committee find it difficult to believe that the Electoral Reform Society would accept such a thing as this.
Baroness Blatch: I happen to come from a part of the country where this system is already in operation. The objective of the exercise is to see that the maximum opportunity is given to every single individual to exercise his vote. It is possible that, when such individuals are called upon by that independent body, they will say that they have positively chosen not to vote and that is an end to it. It may well be that a particular tenant has not received a ballot form, in which case it will be up to the Electoral Reform Society to see that he or she receives a ballot form. It may well be that the tenant does not understand how to exercise the vote. This covers the point mentioned earlier by Members of the Committee who are worried about the inadequacy of people in connection with knowing how to exercise their votes. It is not concerned with canvassing or the presentation of a case because all that goes before the vote. The system has worked perfectly properly and people did vote as a result of being called upon independently by the Electoral Reform Society which saw to it that everyone had a chance to exercise the vote.
The Earl of Caithness: I am grateful to my noble friend who perhaps explained the position better than I. The Electoral Reform Society is not there to put views on behalf of the applicant or the landlord: it is there to collect the vote and to make sure that everyone has the opportunity to vote. Surely that is right for the tenants so that they all know what is going on. If they do not happen to be there on a particular day it does not mean that they do not have the opportunity to vote. Our proposals allow an independent teller to go back to a person and to tell the tenant that there is the opportunity to vote. Does the noble Lord object to that?
Lord Jay: Can we be absolutely clear about one fact! Did we rightly understand the noble Earl to say that the Electoral Reform Society will be paid by the applicant? Presumably the applicants in this case are the relevant landlords. Surely it would be grossly improper for one of the parties to the argument to be paying the independent body which is supposed to be conducting the election. Although I am sure that the Electoral Reform Society is the most independent and honest authority that we have, a great many people will not believe that this is a system of which Parliament could approve.
Lord Harmar-Nicholls: I do not know whether it is deliberate or inadvertent, but Members of the Committee on the other side of this Chamber are making a meal out of something that does not exist. They are viewing this proposal as though it were a general election or a local council election. If that were true, their reactions would be sound; but this is not a general election. Many people will not know that there is to be a vote as to whether a block of property is to be taken over. There will be no

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headlines in the newspaper. There will be no television broadcast to alert people to the election. I should have thought that the Government's proposal carries out what Members opposite have said they wish to ensure; that is, if people do not want to leave their local authority landlord they need not do so.
If people feel strongly about the matter and know that there is an election, they may want to vote so as to achieve a big majority and gain their objective. The election will not be well known. It will be sectional. It may not raise a ripple outside those involved. If there is to be a genuine decision the Electoral Reform Society, or anyone who is to count the votes, will have a duty to let those allowed to vote know that there is to be a vote. What happens afterwards will be nothing to do with the Electoral Reform Society. It will be concerned with the decision only. Members of the Committee, whether by accident or design, should not approach the detail, and it is only detail—
Lord Graham of Edmonton: Not to the tenants.
Lord Harmar-Nicholls: It is only a detail. People who do not want to change need not do so, but those who do want to change can. Noble Lords should not view this proposals as though they were fighting an election.
Lord Stoddart of Swindon: Perhaps I may reply to the question that the Minister asked as to whether I objected to the Electoral Reform Society letting people know that there was a vote, and so forth. I have not objection to that, but I am surprised that the Electoral Reform Society would agree to have anything to do with such a tainted electoral system.
The Earl of Caithness: The contract into which the Electoral Reform Society will enter with the applicant will be the same as the contract into which it enters with trade unions when it comes to a ballot.
Noble Lords: No, no.
The Earl of Caithness: That is absolutely true. A trade union pays the Electoral Reform Society, but that does not threaten the society's independence. I cannot see why an applicant paying for the same contract should threaten its independence.
Lord Underhill: Can the Minister give me one example of the Electoral Reform Society following up members of a trade union who have not taken part in a ballot?
The Earl of Caithness: As I understand it, the contractual relationship will be no different from that with trade unions. There will be an opportunity to vote over a period. There will be every opportunity for the vote to be drawn to the tenants' attention. We do not want, as the Committee does not want, tenants in an area that an applicant wishes to purchase from a local authority to find that there has been a ballot without their having had an opportunity to vote.
Baroness Seear: The Minister's analogy with a trade union is a false one. It is fine for a trade union as such to pay the Electoral Reform Society; it is not right for one of the contestants to do so. That is the difference. In this case. one of the competitors pays the Electoral Reform Society. It is the union as a whole that pays, not Mr. Scargill against whatever his name was. It would have been extraordinary if it had been Mr. Scargill who paid the Electoral Reform Society. The Minister is proposing that Mr. Scargill should pay the Electoral Reform Society. The whole of this Bench would object to that.
The Lord Bishop of Southwark: There is one aspect of this matter that it is important to bring out. I may have misunderstood the argument, which I find difficult and confusing. if I have read the proposed legislation correctly, Clause 102 states that people who do not vote shall he taken to have accepted. That provision puts this exercise into a different category because, contrary to what is being said, it means that urging people to vote may not necessarily be in the best interest of the applicant who proposes to take over the housing. We must be clear that this is not a straightforward you win he loses proposition. That is the point that many of us find difficult to understand and accept.
I can understand the argument that where there is a vote there should be a majority of those voting. When the issue is important and we want to make a substantial change, in our Church we say that a two-thirds majority must be secured because it must carry the good will of a large number of people. We accept that those who do not vote do not do so for reasons that we cannot fully understand or explain. They may not be bothered or they may be unable to do so. They may only be a relatively small number of people, but to say that those who do not vote shall be counted as having voted in favour is a different matter. It is that issue which bothers many people. It bothers those who understandably have enormous fear about security of tenure and affordable rents, because neither matter is as firmly dealt with on the face of the Bill as many of us would like.
Baroness Denington: It is obvious that great concern is felt on this side about the principle we started to discuss some time ago—the kind of vote that is to be taken and how it is to be taken. The concern felt here represents the concern of hundreds of thousands of people. There are hundreds of thousands of tenants who are as concerned as anyone in this place. That concern is felt not only on this side of the Chamber but on the other side as well.
We are talking about democracy. We are talking about people's lives. We are talking about ordinary people to whom the landlord is of considerable importance. He influences their lives. They look to him to fix the rent. We all know that for ordinary people their rent is a basic and important factor in their lives. People hope that their landlord will consider their circumstances and help. Rents are going up. That is another factor which should be in all our minds. Rents are bound to go up under the Government's legislation. That will be a matter of concern.

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What worries me is that unless the vote—this is where we started this afternoon—is the ordinary democratic process of a majority vote, what will be said—surely the Government do not want this—is that there has been gerrymandering. Do the Government really want to start on this basic change for thousands of people with an undercurrent that will become a most powerful one and an accusation that they have simply gerrymandered the whole proposal? I beg the Government to think hard about this matter.
As many Members of the Committee know, I have spent many years working in local government housing. On ceasing to be a member of the GLC I still loved housing. I feel that it is a basic and important factor in everyone's life—as indeed it is. We all know that it is. I therefore became a member and was active on the committee of a number of housing associations. I say a number because there are small associations and large ones, and I wanted to see how the whole range operated.
I beg the Government to think again about this matter, even if it means taking it back today to be reconsidered. I say to them: do not start a new and perhaps very important experiment—I think it is important—in housing on the wrong footing affecting such issues as whether it should be run by local authorities, by housing associations, or whether housing associations should be allowed to grow as large as local authorities—a point that also worries me—because that is what they are doing.
4.30 p.m.
The Earl of Caithness: I should like to answer the right reverend Prelate and the noble Baroness who both raise important points. Although the argument of the noble Baroness carried much force, she ignored one vital point. That is the great difference between what we are talking about today and, for example, what we discussed when the education Bill was before the Chamber; namely, that the vote is not binding on those who do not want it. They have the opportunity to opt back.
For example, if, as tenant of a council house, an application is made for that house and you say "No, I do not want it", your house will be excluded from the proposal. In other words, it will not be transferred and you will still be a direct tenant of the local authority. However, in a block of flats the situation will be different. We do not have flying freeholds in England. In that case, if the vote is for a transfer but you say that you do not want it, the applicant will take over the freehold and give a lease back to the local authority from whom you will take a lease. Therefore your lease will remain under the control of the local authority. So, either way, whether you are the tenant of a flat or house you do not need to transfer to a local authority if you do not wish to do so. That is the great difference. That is the true democracy of the voting system that we have proposed.
Lord Ross of Newport: Will the Minister answer a point to which I wish to come back? Is he aware that meetings are already taking place which are turning
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into political dog fights and that tenants are becoming totally turned off and leaving them? Surely those are the people who will abstain. The Minister is telling the Committee that people who abstain, when the majority of those voting choose to change the landlord, will go automatically but that if they wish to stay with the council they must positively vote and say that they wish to do so. I say to him that many people will be turned off because of the dog fights which will take place. These may not happen between political parties; they could involve a council and private tenants. So there will be a great battle. There will be persuasion, knocks on doors and people saying, "Come on, come our way". There may even be a few bribes about. We do not know. Therefore, such people will say, "I do not want anything more to do with this. I am fed up with it and I shall not vote". By so doing, they automatically vote in favour of the proposal. That is the truth of the matter. Surely, if they do not vote they should be taken as having voted against the proposal.
The Countess of Mar: I have listened most carefully to the debate. There are two points I should like to raise with the Minister. First, I have not understood why the Government object to a simple majority in favour of changing a situation. If we draw an analogy with the argument of the noble Lord, Lord HarmarNicholls, when he said that the Opposition Benches were arguing on the basis of a general election, can he say what board of directors would throw the chairman off the board on the number of "Don't know" votes, including them with the "Yes" votes if that happened to produce a majority?
Secondly, the noble Earl said that those council tenants who do not wish to be transferred need not be. In that case, why on earth must we have this rigmarole? Why does the applicant not go and knock on the council tenant's door and say, "Do you want to be transferred to me?" If the council tenant says, "No", he simply goes away; but if the council tenant says "Yes", he takes over the lease?
The Earl of Caithness: I wish the solution were as simple as that. Indeed, as the noble Lord, Lord McIntosh of Haringey, knows only too well, it is not so simple. It is right that both sides should have the opportunity to put a fair case to the tenant. As the noble Lord, Lord Callaghan, said, perhaps in some unfortunate cases people need to be told clearly and in simple terms what the consequences are. That is absolutely right: both sides should have an equal opportunity to do so. However, it is also right and surely the fairest solution in such a situation where one has a group of tenants—one has to start with a group of tenants who wish to transfer and move out of local authority control—to encourage those people, but at the same time give the true democratic choice to those who do not wish to do so. So that having given them all the information they have the right to say, "No I have heard what you say and I want to stay with the local authority". That is what the Bill provides. Surely that is the right way forward.
I turn now to a point that I wish to look at most carefully. It arose as a result of remarks by the noble Lords, Lord Ross of Newport and Lord McIntosh of

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Haringey. I should like to consider further whether we ought to have a minimum turn-out figure before tenants' choice is implemented. It is an aspect I should like to look at because that, combined with the safeguards which we have provided for in the Bill and by regulations, will, I am sure, give the tenants the rights which they all deserve.
Lord Parry: A few moments ago when I gave way to the right reverend Prelate I heard him say that he was confused and could not understand aspects of the matter. We have also heard a former Prime Minister speak most movingly about the people in his former constituency. I have been approached by several councils in the rural areas of Wales who are equally concerned. It seems most astonishing, in view of the amount of information being given to us, that we should all be so surprised. I even gained the impression that the Minister was thinking on his feet when responding to the questions raised. If that is the case, surely the people living in council houses who are approached during various elections by many people, at a time when the appearance of someone at your front door is not something you take lightly, will be confused and bothered.
Perhaps I may also respond to the analogy with government and local government elections which I think is perfectly made in this gender. If the teller of local government elections was seen to be paid by one of the political parties contesting them, would our system of democracy be held to be as fair as it has always been?
Lord McIntosh of Haringey: We have had a long debate on this matter during which four major strands have emerged with which I shall deal in order of increasing importance. First, there is the question of the propriety of the grouping of the amendments. Second is the issue of the independent tellers in any ballot. Third is the issue as to whether individual tenants can in fact opt out of any decision which has been taken. Fourth—which I still feel is the most important—is the question of the way in which the ballot is decided.
I shall deal first with the doubts which the Minister raised concerning the propriety of dealing with the question of the ballot under Clause 92. As I said earlier, the Government's proposals were advertised a year ago under the heading Tenants' Choice. That is not what the Bill says. It states:
"This Part has effect for the purpose of conferring on any person who has been approved under section 93"—
in other words, the putative landlord—
"the right to acquire from a public sector landlord"
various properties. In other words, what was advertised as being tenants' choice turns out to be landlords' rights—a switch sell if ever there was one.
Clause 92 implies that Clause 93, which is about the persons by whom such a right may be exercised, is so important that it ought to be referred to in the first clause of the part. We think that there are various other safeguards which are also so important that they should be referred to in this clause of the part. One of them is the question of the ballot, which
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we are debating now. The second, which we shall be debating under Amendment No. 125J, is the question of what happens when you have an area of great homelessness or particular housing need. The third is the question of whether those who want to stay with the local authority have a secure right to do so. The fourth, which is under Amendment No. 125L, is the question of whether there is actually going to be any money paid to a local authority by the people who are taking over the properties.
We think that all of those are as important as the question of the persons by whom the right may be exercised, and it is the only way in which there can be any serious attempt to justify the title of the Government's Green Paper of a year ago. If it is to be really tenants' choice, in our view all of those things must be safeguarded, and they must be safeguarded in the first clause in the part where the whole issue which the Government are putting before us is contained.
The second issue is that which has become the question of the Electoral Reform Society, although I do not think the society would like it to be seen in that way. I do not want to follow the Minister into the pit which he has dug for himself, but there are a number of questions still unanswered by this debate. What is it that the Electoral Reform Society has agreed to do? What is it that the Electoral Reform Society has agreed with? Has the Electoral Reform Society positively agreed with the voting procedure being put forward in this Bill? I doubt it. The Minister used the words "chase up". Has the Electoral Reform Society or any other body of independent tellers agreed to chase up non-voters when they are being paid for by one side in the argument?
If that is the case, I think the Minister will wish to make a more definite statement which he will no doubt agree with the Electoral Reform Society before making it. I believe he will wish to do so before we come back to this matter at Report stage because he has left this Committee with a thoroughly confused impression—and to some extent the confusion must be in his mind as well as in the minds of other noble Lords—about what the Electoral Reform Society has said, what the Electoral Reform Society should say, and whether it is supporting these aspects of the Bill.
The third matter is one to which great attention was paid by the noble Lords, Lord Campbell of Alloway and Lord Renton, and indeed by the Minister in his reply. They said, "It's all right. It doesn't matter if this is a totally new way of conducting a ballot. It doesn't matter if you are counting all the 'don't knows' in with the 'yes's' because the individual tenants have the right after the ballot to opt out".
That is not what the Bill says. In Clause 99 the Bill says:
"The Secretary of State may make regulations imposing the following requirements in relation to any acquisition".
That is the exclusion from the acquisition. If the Minister and the noble Lords, Lord Campbell of Alloway and Lord Renton, are saying that "may" should read "shall", we welcome them to our side and welcome their support for Amendment No. 132V, which says exactly that. Even if we achieve agreement

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to Amendment No. 132V—and it looks as though we are going to, so we shall make some progress—I do not accept that we have a right to introduce a totally unprecedented form of balloting.
That brings me to the fourth and most important part of my argument, because it is quite clear from what has been said that those not voting for whatever reason—whether it is because they are sick, old, disabled, or have moved away; or they could be Jehovah's Witnesses and not wish to take part in any ballot—are going to be deemed to have voted for the change. The noble Countess, Lady Mar, asked whether that would be appropriate in the election of the chairman of the board of a public company. I ask Members of the Committee whether it would be appropriate in the voting in this Chamber. We spend more time in the "Contents" Lobby than noble Lords opposite. We should be very happy if those who had not voted were deemed to have voted with us, content for any change in the legislation. No, this simply will not wash. One cannot introduce a new system of voting which puts the onus of defence on those who wish to stay where they are in this way.
4.45 p.m.
The Earl of Caithness: Perhaps on the question of precedent the noble Lord would remind the Committee of the voting procedures in Section 5 of the Housing and Planning Act 1986.
Lord McIntosh of Haringey: I should be delighted if the noble Earl, who is clearly better briefed than I am, would care to do so. He might also like to remind us about the conditions in the 1980 Act which I think are also relevant.
The Earl of Caithness: I said right at the beginning that the process we had proposed was precedented. It was precedented in the Housing and Planning Act 1986.
Lord McIntosh of Haringey: That is a statement; it is not a defence, is it? Since I do not have the papers in front of me I am bound to accept that there may be some precedent for it. It does not make it right. Clearly the views that have been expressed from many sides of the Committee show that this is an unsatisfactory procedure, one which is a denial of democracy and one which has caused justified fear among many millions of people—and here I agree strongly with my noble friend Lady Denington—who know that a rent is an important part of their income and that security of tenure is an important part of the quality of their life. I think it would be irresponsible of me if I did not seek the opinion of the Committee.
Lord Parry: On the matter of precedent-I am sorry; I obey my noble friend on the Front Bench.
4.48 p.m.
On Question, Whether the said amendment (No. 125G) shall be agreed to?
Their Lordships divided: Contents, 136; Not-Contents, 183.

DIVISION NO. 1

CONTENTS

Addington, L.

Leatherland, L.

Airedale, L.

Listowel, E.

Allen of Abbeydale, L.

Llewelyn-Davies of Hastoe, B.

Amherst, E.

Lloyd of Kilgerran, L.

Ardwick, L.

Longford, E.

Attlee, E.

Lovell-Davis, L.

Aylestone, L.

McCarthy, L.

Banks, L.

McIntosh of Haringey, L.

Barnett, L.

Mackie of Benshie, L.

Beaumont of Whitley, L.

McNair, L.

Blackstone, B.

Mais, L.

Blease, L.

Mar, C.

Blyth, L.

Masham of Ilton, B.

Bonham-Carter, L.

Mayhew, L.

Boston of Faversham, L.

Mishcon, L.

Bottomley, L.

Molloy, L.

Briginshaw, L.

Moran, L.

Brooks of Tremorfa, L.

Mulley, L.

Callaghan of Cardiff, L.

Murray of Epping Forest, L.

Carmichael of Kelvingrove, L.

Nicol, B. [Teller.]

Carter, L.

Oram, L.

Cledwyn of Penrhos, L.

Parry, L.

Cocks of Hartcliffe, L.

Peston, L.

Craigavon, V.

Phillips, B.

Croham, L.

Pitt of Hampstead, L.

Dacre of Glanton, L.

Ponsonby of Shulbrede, L. [Teller.]

David, B.

Davies of Penrhys, L.

Porritt, L.

Dean of Beswick, L.

Prys-Davies, L.

Denington, B.

Rea, L.

Diamond, L.

Reilly, L.

Donaldson of Kingsbridge, L.

Richardson, L.

Donoughue, L.

Ritchie of Dundee, L.

Dormand of Easington, L.

Rochester, L.

Elwyn-Jones, L.

Ross of Newport, L.

Ewart-Biggs, B.

Rugby, L.

Ezra, L.

Sainsbury, L.

Falkender, B.

Scanlon, L.

Falkland, V.

Seear, B.

Fisher of Rednal, B.

Seebohm, L.

Fitt, L.

Serota, B.

Gallacher, L.

Shackleton, L.

Galpern, L.

Shannon, E.

Gladwyn, L.

Shaughnessy, L.

Gloucester, Bp.

Shepherd, L.

Graham of Edmonton, L.

Simon of Glaisdale, L.

Greenhill of Harrow, L.

Somers, L.

Greenway, L.

Southwark, Bp,

Gregson, L.

Stallard, L.

Grey E.

Stedman, B.

Halsbury, E.

Stewart of Fulham, L.

Hampton, L.

Stoddart of Swinton, L.

Hanworth, V.

Strabolgi, L.

Harris of Greenwich, L.

Taylor of Blackburn, L.

Hayter, L.

Taylor of Gryfe, L.

Houghton of Sowerby, L.

Taylor of Mansfield, L.

Hunt, L.

Tordoff, L.

Hylton-Foster, B.

Turner of Camden, B.

Irvine of Lairg, L.

Underhill, L.

Jacques, L.

Wallace of Coslany, L.

Jay, L.

Wedderburn of Charlton, L.

Jeger, B.

Whaddon, L.

Jenkins of Hillhead, L.

White, B.

Jenkins of Putney, L.

Williams of Elvel, L.

John-Mackie, L.

Willis, L.

Kearton, L.

Wilson of Rievaulx, L.

Kennet, L.

Winchilsea and Nottingham, E.

Kilmarnock, L.

Kinloss, Ly.

Worcester, Bp.

NOT-CONTENTS

Abinger, L.

Auckland, L.

Alexander of Tunis, E.

Balfour, E.

Alexander of Weedon, L.

Barber, L.

Allerton, L.

Bathurst, E.

Arran, E.

Beaverbrook, L.

Ashbourne, L.

Beloff, L.

615

Belstead, L.

Lothian, M.

Bessborough, E.

Lyell, L.

Birdwood, L.

McAlpine of Moffat, L.

Blatch, B.

McFadzean, L.

Boardman, L.

Mackay of Clashfern, L.

Borthwick, L.

Macleod of Borve, B.

Boyd-Carpenter, L.

Malmesbury, E.

Brabazon of Tara, L.

Manton, L.

Brightman, L.

Margadale, L.

Brookeborough, V.

Marley, L.

Brookes, L.

Marshall of Leeds, L.

Brougham and Vaux, L.

Maude of Stratford-upon-Avon, L.

Broxbourne, L.

Bruce-Gardyne, L.

Merrivale, L.

Butterworth, L.

Mersey, V.

Caithness, E.

Middleton, L.

Camden, M.

Monk Bretton, L.

Cameron of Lochbroom, L.

Montgomery of Alamein, V.

Campbell of Alloway, L.

Morris, L.

Campbell of Croy, L.

Mountgarret, V.

Carnegy of Lour, B.

Mowbray and Stourton, L.

Carnock, L.

Moyne, L.

Carrick, E.

Munster, E.

Carthcart, E.

Murton of Lindisfarne, L.

Chelmer, L.

Nelson, E.

Chelwood, L.

Norfolk, D.

Clinton, L.

Northesk, E.

Clitheroe, L.

Nugent of Guildford, L.

Coleraine, L.

Orkney, E.

Colnbrook, L.

Orr-Ewing, L.

Cottesloe, L.

Peel, E.

Craigmyle, L.

Pender, L.

Crawford and Balcarres, E.

Penrhyn, L.

Cullen of Ashbourne, L.

Peyton of Yeovil, L.

Daventry, V.

Platt of Writtle, B.

Davidson, V. [Teller.]

Portland, D.

Deedes, L.

Portsmouth, E.

Denham, L. [Teller.]

Reay, L.

Digby, L.

Renton, L.

Donegall, M.

Renwick, L.

Dulverton, L.

Rippon of Hexham, L.

Dundee, E.

Rochdale, V.

Elibank, L.

Rockley, L.

Ellenborough, L.

Rodney, L.

Elles, B.

Rollo, L.

Elliot of Harwood, B.

Romney, E.

Elliott of Morpeth, L.

Rootes, L.

Elphinstone, L.

Rotherwick, L.

Enniskillen, E.

Sackville, L.

Erroll of Hale, L.

St. Davids, V.

Faithfull, B.

St. John of Fawsley, L.

Fanshawe of Richmond, L.

Saint Oswald, L.

Ferrers, E.

Saltoun of Abernethy, Ly.

Fortescue, E.

Sanderson of Bowden, L.

Fraser of Kilmorack, L.

Savile, L.

Gainford, L.

Selkirk, E.

Gardner of Parkes, B.

Sempill, Ly.

Gridley, L.

Shrewsbury, E.

Grimthorpe, L.

Skelmersdale, L.

Hailsham of Saint Marylebone, L.

Southborough, L.

Stafford, L.

Harmar-Nicholls. L.

Stanley of Alderley, L.

Harvington, L.

Stevens of Ludgate, L.

Havers, L.

Stockton, E.

Hemphill, L.

Stodart of Leaston, L.

Henley, L.

Strange, B.

Hesketh, L.

Strathcarron, L.

Hives, L.

Strathclyde, L.

Holderness, L.

Strathspey, L.

Home of the Hirsel, L.

Sudeley, L.

Hood, V.

Suffield, L.

Hooper, B.

Swansea, L.

Ingrow, L.

Swinfen, L.

Ironside, L.

Swinton, E.

Jenkin of Roding, L.

Terrington, L.

Johnston of Rockport, L.

Teviot, L.

Joseph, L.

Teynham, L.

Killearn, L.

Thomas of Gwydir, L.

Kintore, E.

Torphichen, L.

Kitchener, E.

Torrington, V.

Lauderdale, E.

Trafford, L.

Long, V.

Tranmire, L.

616

Trefgarne, L.

Westbury, L.

Trumpington, B.

Wolfson, L.

Ullswater, V.

Wyatt of Weeford, L.

Vaux of Harrowden, L.

Young of Graffham, L.

Waldegrave, E.

Resolved in the negative, and amendment disagreed to accordingly.
4.57 p.m.
[Amendment No. 125H not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 125J:
Page 69, line 12, after ("landlord") insert ("in a designated area").
The noble Lord said: With Amendment No. 125J I should like to speak also to Amendment No. 130A. However, before doing so perhaps I may follow up a point which arises from the preceding debate. I suggested to the Minister that it would be appropriate, in view of the concern that had been expressed about the role of the Electoral Reform Society, that he should seek the opportunity to make a statement to the Committee before the matter comes back at the Report stage, and that such a statement should have the agreement of the Electoral Reform Society. Perhaps the Minister will indicate whether such a statement can be made and be good enough to respond to that question now.
The Earl of Caithness: I can tell the Committee that we have had discussions with the Electoral Reform Society on the practical aspects of the consultation and voting systems. The society is content to take on the operational role that we have in mind and we welcome its co-operation and the practical advice it has given us on this matter.
Lord Mayhew: I wonder whether the Minister will bear in mind that it might easily be that the Electoral Reform Society has not fully understood the significance of what it has taken on. Perhaps if it were shown the debate we have had this afternoon in the Committee it might wish to reflect on its position. All of us who have had to fight parliamentary or local government elections may have the advantage of the Minister here. We know that a big poll always helps one side or the other. We also know that there are certain sections of the constituency where one wants a big poll and certain other areas of the constituency where one wants a small poll. I think this is a commonplace to all old hat politicians, of whom, if I may say so, there are many, at least on this side of the Chamber.
I therefore ask the Minister—I speak also as a member and supporter of the Electoral Reform Society—whether he will draw the attention of the society to the discussion we have had this afternoon and come again before the Chamber with a statement.
The Earl of Caithness: We shall naturally be holding discussions with the Electoral Reform Society. I am sure that the society will read what the Members of the Committee have said with interest. We do not want the society involved in any political role as regards the applicant or the landlord. We want

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the society to be an independent vote-taker. But I am sure that this matter will come up again at a later stage.
Lord McIntosh of Haringey: I am grateful to the Minister for the normal courtesy of his reply. He goes a very small distance along the way I was urging him to move. I think it is right that before we come to consider Part IV of the Bill on Report the Committee should be in no doubt whatsoever as regards what the Electoral Reform Society has agreed to, what its role should be and how it should be exercised, as well as who pays the society. I do not want to bring the Minister to his feet again unless he wishes to add anything further—
The Earl of Caithness: Just to put the matter in perspective, I mentioned the Electoral Reform Society but I qualified that by the words "independent teller". It may be the Electoral Reform Society but that is not necessarily the case. I simply wished to clarify that point for the Committee.
Lord McIntosh of Haringey: In view of all of that, I think it is appropriate that I should give the Minister notice that I shall seek some way of providing on the Order Paper an opportunity for the Chamber to debate this matter, perhaps in the form of an Unstarred Question, before the Bill comes back on Report. At that stage the Minister will be able to consider his response perhaps more than he has been able to now.
I wish to speak to Amendment No. 130A with Amendment No. 125J. Amendment No. 125J is another of our attempts to qualify Clause 92. As I have said, Clause 92 gives rights not to tenants but to putative landlords; those who want to apply for the right to take over housing estates from secure tenants in local authorities. We believe that this right being given to landlords, as against the rights of secure tenants, is so wide reaching and so important that it should be qualified in this clause. We hoped that the Committee would agree that it should be qualified as regards the nature of the ballot on which it is to be based. But, unfortunately, we saw again that a number of Members of the Committee who are not perhaps all that frequent attenders of the Chamber were persuaded to come and vote on this matter and that, despite the very good vote that we secured for our amendments, the Committee did not see fit to agree to them.
I think that anybody who has had the close connection with local authority housing which a number of my noble friends and a number of other noble Lords have had will appreciate this. It is of very great importance indeed that nothing should be done to make more difficult the responsibilities of local authorities in areas of housing stress when they deal with the problems of homelessness, problems of shortages of available housing for rent and problems of very high housing need. We are proposing in these amendments that there should be an exclusion from the provisions of this part in the case of those areas where an authority is experiencing homelessness above the national average, where housing need is above the national average and where the available
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housing for rent is below the national average. In Amendment No. 125J we are calling those areas "designated areas". I apologise to the Committee for that shorthand definition.
Nevertheless it is clear that there are very great differences between one housing authority and another, not only in terms of the size and the quality of the stock which they can command but in terms of the need for public sector housing which exists in those areas. It is also clear that the two very often go together; in other words in the areas of the worst housing, the greatest gross deficiency in dwellings to the number of households and where the condition of housing is the worst, the greatest housing need exists because those are the areas of greatest social need. The two go together. Our poorest people live in areas which have historically the worst housing. As we know, they have much greater housing need.
Local authorities already have unequal resources to deal with these problems. One of the difficulties we have been facing in housing policy ever since the war is the inequalities of responsibilities, of opportunities, of resources as well as the demand between one local authority and another. But at least when we are dealing with local authorities there is some attempt in the government assessment of the grant to be given from central government to local authorities to rectify these imbalances. Government grant is given in accordance with general need in an area and not just in accordance with housing need. What is missing entirely from the Bill is any such safety net for the new landlords who will be taking on the responsibility not only of existing secure tenants but ultimately, in due course, of rehousing and the new nominations.
We are putting down these new amendments because we are concerned about what will happen to the homeless under these circumstances. What will happen to those who lose their right to a secure tenancy and who are no longer able to pay the rents which are now to be demanded, whether they are housing association rents on the existing basis or housing association rents on the basis which will be possible under Part III of the Bill? No duties are placed on the new landlords to rehouse the homeless. All that is suggested in a circular from the Department of the Environment is that local authorities may wish to make arrangements with the new landlords or the housing associations or whoever it may be to make provision for the homeless and those in the most desperate housing need. But from where will the money come? To whom will it be paid? How will it be allocated? How much money will there be for this purpose? Those are all questions on which the Bill is completely silent.
It is quite inadequate for a statement of intent, such as is contained in Clause 92, to be silent on this matter. If it is accepted that where there are areas of above average need and below average provision a local authority is to continue to have responsibilities, even if exercised indirectly through these new landlords, would it not be much more efficient and effective for local authorities to continue to exercise those responsibilities directly? In other words, as these amendments say, should not areas of high housing need, areas of high homelessness and areas

619
of below average housing provision be excluded from these clauses?
Let us at least give the Government the benefit of the doubt. Let us tell them to carry on with their proposals where they do not pose a serious risk to people's livelihood and quality of life. But let us not tell the Government to here and now take risks with the quality of life of those who are in most need in our society. We do not think that the Government would seriously wish to take those risks and we cannot believe that the Government would seriously wish to resist these very reasonable and modest amendments. I beg to move.
Lord Campbell of Alloway: What is to happen to those on the housing list? I have sent a private note to my noble friend, but he probably will not have had time to read it. That is a matter of some concern.
Quite apart from the concept of designated or non-designated areas, the amendment raises a matter of general concern. I have been unable to discover in the Bill how this problem is to be dealt with. Is it to be assumed for example that there are to be some kind of transitional provisions on humanitarian grounds? How are they to operate? Will those on a housing list be entitled to be consulted in a ballot? I assume that those on a housing list will be offered accommodation as council tenants when the time comes, but is that right? Is that a correct assumption? How is one to marry the type of dual control between those to be housed by the council and those to be housed by other means? Will not the stock of housing available for those seeking to get on to housing lists become depleted?
I only ask those questions because I am sure that my noble friend the Minister has a perfectly satisfactory answer. No doubt the Government have given consideration to all those aspects of the problem. I hope that my noble friend the Minister will be able to fill in the gaps in my knowledge of the problems. It is a matter which was touched upon and spoken to by the noble Lord, Lord McIntosh of Haringey. Quite apart from the question of designated or non-designated areas, the amendment raises a question of general concern.
Lord Ross of Newport: The noble Lord, Lord Campbell of Alloway, is right to raise those questions. However, I do not for one minute expect an answer from the Minister because I do not believe that there is an answer at present. We are just not building enough houses to rent.
I welcome the amendment because it is at least an attempt to achieve what some of us involved in housing—from all political parties—have been pressing for. In the other place I and colleagues from both the Conservative and Labour Parties suggested that we ought to consider housing on a regional basis and identify the areas of greatest need. The greatest need at present is in London, the South and the West of England. I do not say that there are not other areas where there are housing needs; people could probably point to East Anglia and no doubt there are other areas. But in parts of the North of England there is
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less of a problem. Not so very long ago one could get a council house in Durham immediately. There are areas where there is not the great pressure on housing that there is in this part of the country in particular. It seems to me totally wrong. We have not had an answer, and I do not believe that we shall get an answer. I do not believe that the Minister will accept the amendments. What will happen to the homeless?
I hope and trust that the Minister has just received a copy of the SHAC and Shelter booklet entitled An Act of Compromise which is taken from something which I said when I sponsored the Homeless Persons Bill. I was not satisfied with it. It was an act of compromise. People to the left of my political views did not think that I had gone far enough and a large number on the other side thought that I had gone far too far. In fact the Act has stood the test of time despite the promises of the former Secretary of State for the Environment, Mr. Michael Heseltine, to review it. He reviewed it and left it largely alone. It is apparently under review again and I am worried that it will be weakened.
How on earth does one deal with the 100,000 or more people who are now homeless? I heard the debates which took place in this House when I first entered it. I remember the noble Lord, Lord Soper—I do not believe that he is present now—making great speeches on the issue, and quite rightly so. Homelessness has doubled in the past 10 years. We read today that Mr. Peter McGurk, Director of the Institute of Housing, thinks that between 50,000 to 75,000 more people will become homeless over the next few years after the Housing Bill becomes an Act.
I hope that I am not alone in saying that I am not prepared to live in a country where I shall see people on the streets and begging. That is the point that I used to put to those who opposed me when I was trying to put the Housing (Homeless Persons) Act on the statute book. I asked whether chairmen of housing in places such as Bournemouth or Edinburgh were prepared to see people out on the streets. That is a question which we have to consider very seriously.
I believe that the Government want local authorities to have responsibility for those who are homeless and who have priority—those with children, the elderly or those who for some other reason are unable to look after themselves. They will be put into bed and breakfast accommodation. What happens after that? Who pays the bill? Who will pay the huge sums of money which will be needed under housing benefit?
Earlier in the debate this afternoon I related what is happening in my part of the world where the North British Housing Association has taken over the old GLC properties. The people who occupied those properties in the London area were given the opportunity to live in the country in places like the Isle of Wight. Some opted to go and already had connections with the area. The other day when I was collecting for the blind I met one of those people who was a former Ford worker at Dagenham. He moved about 10 years ago. He has looked after himself; he has a pension from the Ford Motor Company and an old age pension. A year ago when the cuts were made he lost what little housing benefit he received. He now

621
faces a rent of over £30 a week. That would come to about £35 a week if it was registered under the new regime in the North British Housing Association. That will take between 35 per cent. and 40 per cent. of his net income. Will he be able to claim that from housing benefit? We do not know.
How long will the Treasury stand the huge demands that will be made on housing benefit? I do not believe it will do so. We are now being told that local authorities have money in their coffers from the sale of council houses. That money must go towards the paying of housing benefit. Are we to make hundreds of thousands of people queue for housing benefit because they will be priced out of the market?
In my part of the world, and no doubt in other areas, the cheapest property is probably a one-bedroomed flat at about £38,000. A terraced house now costs anything over £50,000. Those prices will not come down. That puts the opportunity of buying property out of reach of my own son earning £10,500 a year, even if his wife managed to pick up some money too, although they have two small children. It excludes vast numbers of the younger generation from the property market. They cannot afford to buy, or if they are stupid enough to buy (and I see that the Leeds Building Society will lend up to three and a half times one's net income) it is very dangerous when interest rates are so high. I regret the pressures placed on people to buy property.
Now we also see the elderly facing huge rent demands. If the amendments are not accepted the country will face a very substantial housing problem. Some people, young and old alike, will face a desperate situation. Therefore I support the amendments, because they are an attempt to put the resources where the need is greatest. We will have to build houses. I am sorry for the Minister who now has responsibility for housing because it will have to be done with public money in one way or another. That money should be put into bricks and mortar instead of used to pay out a great deal of benefit.
Let us build the houses and cure the problem once and for all. We know that the birth rate has fallen and that there will be fewer people requiring housing over the next few years. We have a real chance of solving our housing problem in this country. If we were to proceed on a reasonable basis I think that we might succeed. I beg the Minister at least to listen.
The Earl of Caithness: The noble Lord, Lord Ross of Newport, knows that I have listened very carefully to what he has said. I look forward to the opportunity of having a discussion with him and indeed with all Members of the Committee in a general debate on this subject in the future. We can then discuss housing in its broadest sense. I disagree fundamentally with some of the assumptions of the noble Lord, Lord Ross, in justifying his case.
Addressing the amendment of the noble Lord, Lord McIntosh of Haringey, I believe that there are a number of unspoken assumptions in his proposed new subsection (6). I believe that he highlighted some of those in the arguments which he put forward. It is assumed that as a consequence of tenants' choice homelessness will increase, less housing need will be
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met, and the proportion of housing available for rent will fall. First, I cannot stress too strongly that tenants' choice will not make anyone homeless.
As regards existing tenants, it is a clear and central principle of the scheme that no secure tenant who does not wish to do so will have to transfer against his or her will. Those who do transfer will do so to assured tenancies which give security of tenure; and they will transfer only after they have seen a contractually-binding offer from the applicant about the rents he is asking them to pay after transfer and the arrangements for reviewing them. There is not the remotest threat here of homelessness. I stress this again because unfortunately many tenants—including elderly people and others who could well do without needless worry—have been unnecessarily alarmed by misinformation which they have been given on this point.
Baroness Seear: Perhaps I may interrupt the noble Earl on this question of assured tenancies. Is it not the case that they are only assured if the tenants can pay the increase in rent which the landlord is entitled to introduce after a short period of time? That is "assured" in inverted commas, if I may say so.
The Earl of Caithness: I intended to come to the question of rent in a moment. We do not believe that the tenant's choice will reduce the availability of rented accommodation to house homeless persons or others in the future. It is a firm principle of the scheme that transferred housing should in all normal circumstances be retained for continued renting to people who need it at prices that they can afford. Perhaps that covers the point raised by the noble Baroness.
Perhaps I may explain further how these principles will be put into practice. Clause 93(3) requires the Housing Corporation, and in Wales, Housing for Wales, to establish criteria that candidates for approval under the scheme must meet. These criteria, on which the corporation, as many noble Lords will know, consulted interested parties in draft on 3rd August, will include a requirement for applicants to undertake to retain dwellings acquired under tenants' choice for letting at rents affordable by those in low-paid employment.
The draft criteria would also require applicants to comply with the corporation's guidance for tenants' choice landlords on housing management practice; in other words, the embodiment for such landlords of the tenants' guarantee that we have been developing on a broader front from housing association tenants. This guidance confirms the approach to rents in the criteria themselves, acknowledging that rent levels will often need to be below market levels. It confirms:
"Tenants' choice landlords are expected to retain their housing stock for letting, and to dispose of it only in particular circumstances, which require the consent of the Secretary of State".
The reference to consent here is to the Secretary of State's powers under Clause 104.
The draft guidance, moreover, includes clear expectations about the part that applicants must play in meeting housing demand, including the kinds of allocation policies that they will be expected to pursue.

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I now come to the points raised by the noble Lords, Lord McIntosh of Haringey and Lord Ross of Newport, and indeed the point raised by my noble friend Lord Campbell of Alloway about waiting lists. The draft guidance states:
"Tenants' choice landlords are expected to provide accommodation for those who are inadequately housed or homeless and whose housing requirements cannot be met at prices within their means, or at all, elsewhere in the local market".
Lord Campbell of Alloway: Perhaps I may interrupt the noble Earl.
The Earl of Caithness: May I just finish the quotation?
"In determining their priorities for the provision of accommodation and the offer of tenancies, they are expected to take account of housing demand and conditions in their area. This will involve consulting the local strategic housing authority".
Lord Campbell of Alloway: I am so sorry and I apologise to my noble friend, but can he say from where that quotation comes? From which document is my noble friend reading? Is it part of a statute or a regulation? What is it?
The Earl of Caithness: As I have said, it is part of the draft guidance upon which the Housing Corporation has consulted very widely. It was published on 3rd August. The list of organisations includes bodies such as Shelter, the National Federation of Housing Associations, the Commission for Racial Equality, all the local authority associations that I can recall, the British Property Federation and national tenants' associations. So this document has been circulated widely.
Lord Campbell of Alloway: May I ask my noble friend whether these measures will have statutory force and effect by regulation?
The Earl of Caithness: I should like to take legal advice upon that point. Perhaps I may just add something to what the guidance says when dealing with allocation policies. The guidance makes clear:
"The Housing Corporation expects [them] to be clear; to be based upon an applicant's housing needs, not for instance upon the date of application; and to provide equality of opportunity to all sections of society, taking particular account of the race relations and the sex discrimination legislation".
These expectations will be binding on all tenants' choice landlords, under the sanction of loss of their approved status. That would abort any applications in train and prevent any new ones. In the case of registered housing associations also—and many tenants' choice applicants will be registered housing associations—the corporation will, as a consequence of Clause 49 of the Bill, also have more direct powers under Part I of the Housing Associations Act 1985 to ensure that the guidance is observed.
I turn briefly to the question of homelessness, which I have covered in part, but I think it worth reminding the Committee that the noble Lord, Lord Ross of Newport, is correct. We are undertaking a review of the homelessness legislation and we shall of course be taking into account the recent reports
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published by the Institute of Housing and the Shelter/SHAC report which I am reading at the moment with great interest. I can confirm what I said a moment ago to my noble friend Lord Campbell of Alloway: the tenants' guidance will not be legally binding but it will be a condition of approval under Clause 93. I repeat that the sanction will be the revocation of approval, which means that they will not be approved by the Housing Corporation.
Lord Campbell of Alloway: I am very much obliged.
Lord Stallard: The noble Earl constantly mentioned in his reply, though he did not do so when replying to my previous question, that housing associations will be the alternative landlords. Is it not relevant for him to say whether or not it will be legal for housing associations to buy up chunks of council property? If it is illegal for housing associations to buy up such property, as was suggested by the Charity Commissioners, then this whole argument and every reference to housing associations are surely invalid. I ask the Minister: can he now tell me whether it is legal for housing associations, which are registered charities, to engage in the wholesale buying up of property that is inhabited by people who are not in need of housing but who are already housed?
The Earl of Caithness: I thought I had a note on that point which would answer the noble Lord, but I cannot find it at the moment. I promise, however, that I shall answer him.
Lord Swinfen: Before my noble friend sits down, can he confirm that generally speaking it is easier for a local government housing authority to obtain possession from a defaulting tenant than for a private landlord to do so?
The Earl of Caithness: I bow to my noble friend's greater experience on this subject.
Baroness Fisher of Rednal: I do not think that the noble Earl has answered many of the points made by my noble friend on the Front Bench. The people about whom we are speaking are the homeless; they are registered on a local authority's housing list and all local authorities have waiting lists. The latest publication of the ADC shows increasing numbers on their housing lists because of the housing for sale policy through which many people in the villages have lost their houses. The ADC is also bringing forward from the districts the problem of homelessness. Those of us who have lived in large cities are not exactly used to homelessness but are aware that it has been a problem for a long time. Homelessness, however, is now being felt all over the country, and as the noble Lord, Lord Ross, so clearly spelt out, what we want is more houses. We do not want simply to juggle landlords about, whether councils, private landlords or whatever. That will not solve the problem of homelessness. It will not solve the problem that there are not enough properties to go around. If there were, people would be living in those properties. I hope that the Minister does not give us the number of council properties that are empty. The figures have been published. The largest

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number of empty properties—double those in local authority ownership—are owned by the Government.
We cannot dismiss homelessness by saying that private landlords will rehouse. We know very well that they will not rehouse most of the registered homeless. Those who have been involved in housing for a long time know that when these private landlords take over they will pick and choose their tenants in a very selective way.
In his reply, the Minister spoke of housing benefits being kept up and people having their money paid. It would all be part of assured tenancies. However we now have the new consultation paper on housing finance in the 1990s. The Minister is saying that if the housing finance proposals come about in the 1990s, housing benefit will be very seriously in danger. A worrying suggestion for council tenants is that they will have to take responsibility for housing subsidy in the case of those who cannot pay. In other words, council tenants who can afford to pay the rent will have to pay the subsidy for those who cannot afford it. These thoughts are in the housing consultation paper. That policy will not solve anything for the homeless.
We have a Housing Bill that is against local authority housing. That is deplorable. All the innovations that have taken place in housing have come through the local authorities. It was the local authorities that started to build bungalows for aged persons. It was the local authorities that started sheltered housing. It was the local authorities that put in all the facilities for the disabled. This Bill is not providing one more house for anybody who is on a housing register or who is homeless. It is simply destroying local authority housing.
5.30 p.m.
The Lord Bishop of Southwark: I am nervous that we return to a possibly sterile argument between those who are anxious to break up what they see as the log-jam state of municipal housing in some parts of the country—with all the difficulties that have arisen over management and so on—and those who defend municipal housing for all the good reasons that the noble Baroness has just described.
As I understand it, the philosophical point is this. If one allows free market forces to have their play one will have more demand and the matter will begin to balance. But even the most earnest of free market advocates have always recognised that there is a point beyond which the market does not always meet the needs of some people. It is not an absolutely efficient instrument. There are certain kinds of need that have to be met by state intervention and support. I should have thought that this was particularly so with housing because it is so expensive. I am sorry to return to a very obvious point but it is one which we seem to allow to slip away in these debates. Housing is extremely expensive particularly in a cold climate. That is why one has to face the fact that one cannot do it on the cheap.
I was a member of the national housing inquiry chaired by the Duke of Edinburgh. We wrestled extremely hard with the basic problem of whether
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one subsidises the building or the person. We were absolutely clear that one cannot get away with subsidising neither. One may make different decisions. On the whole we came down in favour of subsidising the person. That means that in areas of shortage where rents will rise—because rents rise in a free market when there is a shortage—one will have to pay high housing allowance or benefit. That is the absolutely core problem that any government face. It will help me enormously in considering the rightness or wrongness of different elements in this Bill if we can have a more clear-cut assurance that in areas of high housing shortage, where there will be high rents and where the market is allowed to operate fairly freely, housing allowance and benefit for those who are genuinely in need will also be raised.
We have heard a certain amount about secured tenants. The point about homeless people is that they are not secured tenants. They are not tenants. They need to be rehoused. If the local authority has little or no housing and, under the draft guidance, turns to the people to whom those houses have been sold and says, "You have a duty to allow us to nominate some homeless people", the new landlord will say, "Yes, but the registered rent is £60 a week." Perhaps it could be £45—
Lord Graham of Edmonton: It will be £60.
The Lord Bishop of Southwark: It will probably be £60, because we shall be using a property that does not have a tenant in it. The homeless person or family is almost certainly in the category which cannot afford that sum. If we are then going to say, "I am very sorry but housing benefit can only rise to a certain level and will not meet rents above that level", what happens next?
This is a key problem. I am not going entirely off the point because I am concerned with what happens to homeless families and homeless people if the responsibility for housing them is held by one group and when others who could provide the housing cannot do so at a price that they can afford because a third group—central government—say, "You cannot have the money".
I hope that the Minister will help us to address this problem and give some assurance that we do not get into that intolerable position. We are quite near it in some places.
The Earl of Caithness: The right reverend Prelate has made a fascinating speech. I was particularly interested when he reminded the Committee that he had come down in favour of helping the person rather than giving grants for bricks and mortar. This is a problem with which I have been wrestling since I took over the portfolio on housing that I am lucky enough to have been given. We appreciate the great difficulties. Where there is a shortage of housing it happens to be where it is most built up at the moment—in the cities, where there are perhaps no more sites available. However, I would stress to the right reverend Prelate that where one is giving people tenants' choice which is the link to the amendment we are considering, one of the criteria that a tenant's choice landlord—it may well be a housing

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authority—will have to fulfil is to provide accommodation for those on below-average incomes; that is, the homeless and those at the bottom of the ladder.
We realise that more rented accommodation is required. We want more rented accommodation. We want a greater diversity of rented accommodation. When one looks at the grants given to the housing associations, one can see that, rather than making a true cost of the land and development in the form of rent, we are able by grants to subsidise the land and the development cost to achieve a rent that is affordable. That is a subject to which we are paying great attention.
However, I would make it absolutely clear that as a result of the change in the rules in housing benefit in April, those at the lowest end of the scale, those least able to afford it, will receive 100 per cent. of housing benefit payment. So we are attacking it from two directions. It is a very serious problem and one with which we continue to wrestle. We have two principles. One is to get the rent to an affordable level for those at the lowest end and the second is to back that up with the higher housing benefit.
I have found the bit of paper that I was looking for to enable me to reply to the noble Lord, Lord Stallard. The final situation is not resolved, but he, as well as the rest of the Committee, will know that housing associations, including charitable associations, have already acquired blocks of tenanted dwellings from the public sector bodies, particularly in the new towns in the past. However, I shall inform the Committee as soon as I hear the result of the present discussions that are going on with the commissioners and my department.
Lord McIntosh of Haringey: The right reverend Prelate the Bishop of Southwark was surely right to warn us of sterile ideological debate. It is simply not good enough for any of us to say either "private sector housing bad, public sector housing good" or "public sector housing bad, private sector housing good". It is not like that. There clearly have to be both sectors in any decent range of housing provision if we are to meet the housing needs of this country.
However, I believe that the right reverend Prelate oversimplifies a little if he thinks that it is possible to put all the public financial support for housing for those most in need on to the individual rather than on to the property. I should have thought—I say this with great respect for the work with which he has been involved and the work of the many commissions that have been involved—that one has to do both. There have to be housing authorities, those responsible for providing housing who have obligations put upon them to meet those in the greatest housing need—above all the homeless—as well as a requirement for housing benefit which meets the financial needs of those in the greatest need. That has always been recognised in our legislation, particularly in the legislation that was so ably helped by the noble Lord, Lord Ross of Newport, in another place.
The Lord Bishop of Southwark: One important reason why people tried to get away from that solution to subsidise the building was that, if one is not careful, one would perhaps be subsidising people who did not need subsidy. That is the free market argument. I am only saying that I think the noble Lord is right in terms of the situation in which we find ourselves, but in theory, following more freemarket philosophy, it would be better, more logical, to subsidise only those who have need of subsidy.
Lord McIntosh of Haringey: I appreciate the force of that argument and I would modify what I have said to the extent of saying that in addition to an adequate housing benefit scheme—we shall be considering tomorrow whether the housing benefit scheme to come out of this Bill will be adequate—there must be, if not subsidising of bricks and mortar in a crude way, some responsibilities on those providing housing to see that the nominations go to the people in need.
That is what these amendments are concerned with. We are not arguing for a general subsidy on bricks and mortar which, as the right reverend Prelate correctly says, goes to those least in need. We are arguing that this change should not take place in local authorities' areas which have exceptionally high levels of homelessness or exceptionally high levels of housing need. We believe that the safeguards provided by the Government, on which the Minister dilated at some length, are not adequate.
In response to questioning by his noble friend Lord Campbell of Alloway, the Minister admitted that in the Bill there are no statutory obligations, no duties on new landlords to rehouse the homeless or to take nominations from the homeless. He put up instead the quite irrelevant Aunt Sally as if we had been claiming that this part of the Bill would automatically throw a lot of people out on to the street and create many new homeless. That is not what we said. What we said is that the obligation to house the homeless and to deal with those in greatest housing need is a continuing obligation.
The draft guidance which the Housing Corporation has produced, after consulting but without necessarily securing the agreement of many bodies in the housing field, is not good enough. It states that the new landlords will be expected to take account of the needs of the homeless and the requirements of those in greatest need. What it does not say is that there will be a duty to provide for them. It is the duty to provide for them which is the ultimate sanction on local authorities, thanks to the noble Lord, Lord Ross of Newport, in part—I shall gladly give way to him in a moment—but it is that duty which will be lost if a significant part of our housing stock is transferred from local authorities who have a duty to new landlords who will not have a duty.
Lord Ross of Newport: Will the noble Lord agree that what is really happening is that we are returning to a pre-1974 situation before the Housing (Homeless Persons) Act 1977 in Conservative Party thinking? At that time the then Minister for Housing, Mr. Hugh Rossi, introduced two circulars. One was in 1974; I forget the date of the other. They asked local

629
authorities to do exactly what the Minister seems now to be asking private landlords and others to do. He asked them to do it, but it was not a statutory obligation. Eventually legislation was needed to make it a statutory obligation.
What I am hoping to do by my intervention is to impress upon the Minister to consider the previous situation in 1973–74. Quite rightly the Government at that time brought this forward. I believe they expected local authorities to follow it, but unfortunately many did not. That was the reason for the ultimate production of the legislation.
Lord McIntosh of Haringey: I am grateful for that intervention because the noble Lord has much more experience in these matters than I have. He has made the point more clearly than I could have done. It has been our experience over the years that if there is to be anything approaching adequate treatment of the homeless and those in greatest housing need—heaven knows the treatment given to them now is not adequate—there has to be a duty on somebody to house them. Somebody has to have a duty to be concerned for them. A draft or even a finalised guidance which states that the new landlords have to take account of those needs is not good enough. I hope the noble Lord will agree with me that on the basis of the Minister's reply it would be quite wrong for us to withdraw the amendment. I commend it to the Committee.
5.47 p.m.
On Question, Whether the said amendment (No. 125J) shall be agreed to?
Their Lordships divided: Contents, 103; Not-Contents, 160.

DIVISION NO. 2

CONTENTS

Addington, L.

Falkland, V.

Airedale, L.

Fisher of Rednal, B.

Amherst, E.

Fitt, L.

Ardwick, L

Gallacher, L.

Aylestone, L.

Galpern, L.

Banks, L.

Graham of Edmonton, L.

Barnett, L.

Greenway, L.

Beaumont of Whitley, L.

Grey, E.

Blackstone, B.

Hampton, L.

Blease, L.

Hanworth, V.

Bonham-Carter, L.

Harris of Greenwich, L.

Boston of Faversham, L.

Hatch of Lusby, L.

Bottomley, L.

Hunt, L.

Brooks of Tremorfa, L.

Irvine of Lairg, L.

Callaghan of Cardiff, L.

Jacques, L.

Caradon, L.

Jay, L.

Carmichael of Kelvingrove, L.

Jeger, B.

Carter, L.

Jenkins of Hillhead, L.

Cledwyn of Penrhos, L.

John-Mackie, L.

Cocks of Hartcliffe, L.

Kilmarnock, L.

David, B.

Kirkhill, L.

Davies of Penrhys, L.

Listowel, E.

Dean of Beswick, L.

Llewelyn-Davies of Hastoe, B.

Diamond, L.

Lloyd of Kilgerran, L.

Donaldson of Kingsbridge, L.

Longford, E.

Donoughue, L.

Lovell-Davis, L.

Dormand of Easington, L.

McIntosh of Haringey, L.

Elwyn-Jones, L.

Mackie of Benshie, L.

Ennals, L.

McNair, L.

Ewart-Biggs, B.

Mais, L.

Ezra, L.

Mar, C.

Falkender, B.

Mayhew, L.

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Meston, L.

Seear, B.

Molloy, L.

Serota, B.

Mulley, L.

Shackleton, L.

Murray of Epping Forest, L.

Shepherd, L.

Nicol, B. [Teller.]

Stallard, L.

Ogmore, L.

Stedman, B.

Oram, L.

Stewart of Fulham, L.

Parry, L.

Stoddart of Swindon, L.

Peston, L.

Strabolgi, L.

Phillips, B.

Taylor of Blackburn, L.

Pitt of Hampstead, L.

Taylor of Gryfe, L.

Ponsonby of Shulbrede, L. [Teller.]

Taylor of Mansfield, L.

Tordoff, L.

Prys-Davies, L.

Turner of Camden, B.

Rea, L.

Underhill, L.

Ritchie of Dundee, L.

Wallace of Coslany, L.

Rochester, L.

White, B.

Ross of Newport, L.

Williams of Elvel, L.

Rugby, L.

Willis, L.

Russell of Liverpool, L.

Winstanley, L.

NOT-CONTENTS

Abinger, L.

Gardner of Parkes, B.

Aldington, L.

Gridley, L.

Allerton, L.

Grimthorpe, L.

Ampthill, L.

Hailsham of Saint Marylebone, L.

Arran, E.

Balfour, E.

Harmar-Nicholls, L.

Bathurst, E.

Harrowby, E.

Beloff, L.

Harvington, L.

Belstead, L.

Hemphill, L.

Bessborough, E.

Henley, L.

Blatch, B.

Hesketh, L.

Boardman, L.

Hives, L.

Borthwick, L.

Holderness, L.

Boyd-Carpenter, L.

Home of the Hirsel, L.

Brabazon of Tara, L.

Hood, V.

Brookeborough, V.

Hooper, B.

Brookes, L.

Ingrow, L.

Brougham and Vaux, L.

Ironside, L.

Broxbourne, L.

Johnston of Rockport, L.

Butterworth, L.

Joseph, L.

Caithness, E.

Kenilworth, L.

Camden, M.

Killearn, L.

Cameron of Lochbroom, L.

Kintore, E.

Campbell of Alloway, L.

Kitchener, E.

Carnegy of Lour, B.

Lauderdale, E.

Carnock, L.

Long, V.

Carthcart, E.

Lyell, L.

Charteris of Amisfield, L.

McFadzean, L.

Chelmer, L.

Mackay of Clashfern, L.

Chelwood, L.

Macleod of Borve, B.

Clinton, L.

Malmesbury, E.

Clitheroe, L.

Manton, L.

Coleraine, L.

Margadale, L.

Cottesloe, L.

Marley, L.

Craigavon, V.

Marshall of Leeds, L.

Craigmyle, L.

Maude of Stratford-upon-Avon, L.

Crawford and Balcarres, E.

Daventry, V.

Merrivale, L.

Davidson, V. [Teller.]

Mersey, V.

Deedes, L.

Middleton, L.

Denham, L. [Teller.]

Milverton, L.

Digby, L.

Monk Bretton, L.

Donegall, M.

Montgomery of Alamein, V.

Dulverton, L.

Morris, L.

Dundee, E.

Mountgarret, V.

Elibank, L.

Mowbray and Stourton, L.

Elles, B.

Moyne, L.

Elliot of Harwood, B.

Munster, E.

Elliott of Morpeth, L.

Murton of Lindisfarne, L.

Elphinstone, L.

Napier and Ettrick, L.

Enniskillen, E.

Nelson, E.

Erroll of Hale, L.

Northesk, E.

Faithfull, B.

Nugent of Guildford, L.

Fanshawe of Richmond, L.

Orkney, E.

Ferrers, E.

Orr-Ewing, L.

Forester, L.

Peel, E.

Fortescue, E.

Pender, L.

Fraser of Kilmorack, L.

Penrhyn, L.

Gainford, L.

Peyton of Yeovil, L.

631

Platt of Writtle, B.

Stanley of Alderley, L.

Portland, D.

Stevens of Ludgate, L.

Portsmouth, E.

Stodart of Leaston, L.

Reay, L.

Strange, B.

Redesdale, L.

Strathcarron, L.

Renton, L.

Strathclyde, L.

Renwick, L

Strathspey, L.

Ridley, V.

Sudeley, L.

Rippon of Hexham, L.

Suffield, L.

Rochdale, V.

Swansea, L.

Rodney, L.

Swinfen, L.

Rollo, L.

Swinton, E.

Romney, E.

Teviot, L.

Rootes, L.

Thomas of Gwydir, L.

St. Davids, V.

Torphichen, L.

St. John of Fawsley, L.

Trafford, L.

Saint Oswald, L.

Tranmire, L.

Sanderson of Bowden, L.

Trumpington, B.

Savile, L.

Ullswater, V.

Shrewsbury, E.

Vaux of Harrowden, L.

Skelmersdale, L.

Waldegrave, E.

Southborough, L.

Wyatt of Weeford, L.

Resolved in the negative, and amendment disagreed to accordingly.
5.57 p.m.
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 125K:
Page 69, line 12, leave out from ("to") to end of line 13 and insert ("regulations made under section 99(1) below").
The noble Lord said: In moving Amendment No. 125K, I wish to speak also to Amendment No. 132V. This should be a short debate. The gravamen of the amendment is to invite the Government to put clearly on the face of the Bill, once and for all, the fact that a tenant, in accordance with the words in Clause 99 at page 74 of the Bill, has given notice,
"in such manner as may be prescribed of his wish to continue as a tenant of the landlord".
In other words, in respect of the tenants who object strongly to transfer, who exercise their rights in a ballot and who say that they do not wish to be transferred, the Minister and his supporters have said in this Committee and elsewhere not only that there is no intention but also that the tenants shall ipso facto remain tenants of the local authority. Yet, when one looks at the words which give effect to that, one sees, under the heading "Tenants continuing as tenants of landlord",
"The Secretary of State may make regulations imposing the following requirements".
I hope that there will be no dubiety about the fact that the word "shall" is much more positive than the word "may". If the Minister argues that "may" means "shall" we should prefer the use of the word "shall" which is more positive.
Why have the Minister and his advisers chosen the word "may" to describe the intention "shall"? I believe that it is because there is some dubiety about the ability. The Minister shakes his head. In that case, he can put that dubiety out of the window. We are talking about people who may, in accordance with the Minister's view, be over-sensitive about the nuances and meanings of words. The Minister does not need to be told that, whether or not they have security of tenure, for many people the quality of their landlord and their rights are central to the quality of their life. The Minister will be doing his case, and the case that led many of his supporters into
632
the Lobby with him in the earlier votes, a lot of good and will be putting at rest the minds of thousands if not millions of people if he says that if they choose to exercise their right and say no, even though by the ballot rigging procedures that are applied their freehold may be transferred to someone else, they have the right to remain as a tenant.
The gravamen of these amendments is that we are simply saying to the Minister: put at rest the minds of many people. I am not going to get into the argument about extremes or agitation, or about being led to believe otherwise. It is a simple amendment and I hope the Minister will accept it in a simple and straightforward way. I beg to move.
Lord Campbell of Alloway: I support these amendments if only to retain a measure of credibility in the Chamber for what I said on a previous amendment, and which I understood to be the policy of the Government, and to ensure that "shall" and not "may" appears in Clause 99.
With respect, it is not fair to charge my noble friend the Minister or his department with dubiety, because there is a curious esoteric form of draftsmanship which parliamentary draftsmen will use at times. The Committee has heard the noble and learned Lord, Lord Scarman, speak of many occasions when the Appellate Committee of your Lordships' House interprets "may" as "shall" and vice versa. Of course, the whole thing is a nonsense. Over teatime I sought the advice informally of a noble and learned Lord who had been listening to the debate and who had read Clause 99. He took the view that without any shadow of doubt it was, in its present form, permissive and not mandatory: hence the importance of this amendment, which clears up the whole question that lies at the fundamental basis of my support for the Government.
The Earl of Caithness: I should like first to speak to Amendments Nos. 125K and 128A. As I understand them, the amendments seek to clarify that the applicants' right to acquire is limited by the right under Clause 99(1) for certain tenants' homes to be excluded from the acquisition or leaseback to the existing landlord.
I am advised that the drafting of Clause 92 achieves precisely that effect. It provides:
"the right to acquire…subject to and in accordance with the provisions of this Part".
Those words quite plainly mean that an acquisition must go through all procedures laid down in the part. I can assure the Committee that it must conform to Clause 99(1) and have excluded from it or lease back the homes of tenants who vote to stay with their existing landlord and of tenants excluded from the right by Clause 92(3) in particular.
I can go on to assure the Committee that the regulations needed to implement Clause 99(1) will be made by my right honourable friend if Parliament grants him that power. We have promised all along that tenants should have the individual right to opt out of a transfer. We regard that as an essential and wholly democratic feature of our proposals, and we will see that it is properly implemented.

633
I turn to the third amendment grouped with Amendment No. 125K; that is, Amendment No. 132V. I understand that the arguments I have put forward to the Committee for Amendments Nos. 125K and 125A also apply to Amendment No. 132V, but I rather prefer "shall" to "may" and I will accept that one.
Baroness Fisher of Rednal: Will the Minister please explain why he said that the Secretary of State may make regulations? I understand that he is now going to say "shall". The noble Earl explained during a previous debate on ballots that at present some regulations are being seriously considered. I wonder whether he can give us some idea of what those regulations may be, as he has done with regard to the opting-out procedure. This is almost in the same category as opting out. As the noble Earl said, there is a misunderstanding in that people feel they have got to vote. Will there be any different regulations as distinct from the opting-out regulations where they definitely have to say no?
Lord Campbell of Alloway: I am most grateful to my noble friend the Minister for his openmindedness. Once Clause 99 is amended in this Bill it casts an entirely new light on the voting procedures because, although the procedures are novel, the fact of the matter is that it is now enshrined, or will be, in the statute that those who do not want to go along can opt out. That draws a distinction constitutionally between this type of voting procedure and other types of voting procedure. Therefore it is no longer right in this context to refer to these voting procedures as tainted or suspect. They are just different. This is relevant to the voting procedures.
The Earl of Caithness: I should like to thank my noble friend for his last intervention. I think that that was extremely helpful and supported what I said earlier. I am not sure that I fully understood what the noble Baroness was getting at. The regulations will be laid before Parliament and will be considereed in that context.
Lord Graham of Edmonton: I am grateful for the Minister's reply with regard to Amendment No. 132V. As a result of the fact that the Minister and the Government were reluctant until three minutes ago to acknowledge the concern of those who wanted the positive right written on the face of the Bill, there has been some uncertainty and disquiet; in fact, I would use the word "distress".
I am grateful for the support of the noble Lord, Lord Campbell of Alloway, for the central piece of these amendments. Of course the procedure is different. It is still wrong. The noble Lord said that it was not tainted, but it is still tainted. There is no procedure that says that a minority of those who are entitled to vote can aggregate to their vote all those people who did not vote and ipso facto turn a minority into a majority. There is no procedure unless your name is Gerry Mander. That is what happens because a minority of the people entitled to vote will pick up, for whatever reason, the votes of those who have not voted, add them to theirs and then outweigh a number that was in excess of theirs.
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The noble Lord has underlined the crucial importance for people who wish to remain tenants of their local authority of being able to opt out. By opting out, in effect they are voting yes, but this recognises that by voting no they could very well form the majority of the people who vote. If it is a majority of those entitled to vote, then the whole of their estate will not be transferred to a new landlord. To that extent, whether it is a concession, a clarification, a revision or an assurance, we on this side of the Committee are grateful for the Minister's intentions as regards Amendment No. 132V. In those circumstances, I willingly and readily beg leave to withdraw the amendment that we are now debating.
Amendment, by leave, withdrawn.
6.15 p.m.
Lord Dean of Beswick Lord Dean of Beswick moved Amendment No. 125L:
Page 69, line 13, at end insert ("and after payment of a positive sum to the vendor").
The noble Lord said: I understand that we arc also speaking to Amendment No. 132T. The amendments before the Committee try to ensure that the local authorities receive some justice as regards the question of transfer of assets and so on. Amendment No. 132T ensures that local authorities will not be forced to pay applicants a form of dowry to go with the transfer of stock. Under the Bill that is a possibility and I suggest that would be grossly unfair.
The consultation paper stated that:
"In some cases, the obligations of ownership will he such that application of the principle of market value subject to tenancy will result in a payment by the existing landlord to the new landlord rather than vice versa".
Some years ago the right honourable Peter Walker MP said that they, meaning the councils, should give the houses away. It is alarming to see that this view has now been overtaken. It is bad enough to leave the remaining public sector tenants with outstanding debt charges on the properties transferred but to expect those tenants to contribute to the profit margins of those new landlords with whom they had and have no connection is scandalous. In a competitive market the buyer must beware. That concept of negative valuation appears to be turning that age old consensus upside down.
If that exercise is carried through it will place another grossly unfair charge on the remaining council house tenants. Perhaps I may give some examples of what previous legislation in the last few years has done. Members of the Committee on all sides and Members in another place are aware that substantial properties are being demolished, mainly in the inner cities—properties that have been in existence for less than 20 years. The amount of blame as regards those properties which can be laid on the local authorities is absolutely minimal. A succession of governments of both colours, both Conservative and Labour, insisted on particular types of properties being built.
I cite Leeds with which I had a connection as a Member of Parliament for some years. It has had to demolish a property known as Hunslet Grange which comprises over 1,000 units of housing with

635
approximately 40 years outstanding debt charges which have to be met from the rest of the council house rents in Leeds. I do not have the figures available but I should think it would be safe to say that Manchester's problem is three times greater than that. Most of those properties in Manchester were known as The Forts. Some have been demolished, most are empty and they illustrate a previous criticism of planners and architects who do not now have to pick up the bill. Under present legislation it is council house tenants in the remaining properties who have to pay although they have had nothing at all to do with the building of those houses. In Leeds alone it is costing the housing revenue account £750,000 each year for a mistake which was not of their doing.
If one wants further to illustrate the position I believe that the Government are getting themselves into a situation where council house tenants who wish to remain council house tenants will believe that the Government, by legislation over the years, are conducting some sort of vendetta against them.
I remember in another place initiating the first debate on the consequence of industrial housing. I believe that I received a measure of support from all sides of the House. There were a number of Conservative Members—for example, the present Member for Bath, Mr. Patten—who spoke quite forcefully in the debate. We all agreed that it was a situation that should be corrected. However, many of the Members concerned were not quite on the same slant as I in that particular debate. They were worried about former or present council house tenants who had bought industrialised housing which was, at that time, showing serious defects.
Therefore, to their credit the Government responded and a particular type of house—I think it was called the Orlit house—was picked on and it was decided that people who had bought an Orlit house from the local authority could obtain a maximum of £9,000 per house to put the house into a reasonable state of construction and repair. I am now speaking without notes but I believe that gradually that system had other systems added to it. However, what was grossly unfair—and I came across this in Leeds—was that people had bought industrialised or semi-industrialised houses but on resale found that they had an asset which they could not realise because nobody wished to buy even though they were valued downwards by as much as 30 per cent. and were in good condition. Nobody was interested in a second purchase.
The Government then came along with the idea that the person who bought the house at a considerable discount could make the local authority buy the house back and at an enhanced price. However, the point is this: who had to find that money? Of course, it was the remaining council house tenants who had no dealing whatever in any of those particular transactions. That is one reason why in some areas, the council house rents have risen fairly dramatically by any standards.
Council house tenants who remain in those industrial houses cannot get their repairs carried out.
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That is not because, as the noble Lord, Lord Campbell of Alloway, said to an earlier amendment the local authorities are neglectful. I am not defending local authorities because some have left a lot to be desired. I believe that at one time Manchester was the third biggest landlord in the country and that only the GLC and Birmingham, where the noble Baroness, Lady Fisher, was chairman of housing were larger. I do not sit down and accept the criticism that the tenants in Manchester were not looked after. They were looked after. We made some mistakes but to ascribe the dereliction or the lack of maintenance of council houses today as the sole responsibility of local authorities is absolutely bunk and the Minister knows that.
Successive reports from non-political bodies, such as that from the Institute of Policy Studies, the BEC and Mr. Howard Davies and his group of officers all arrive at the same conclusion: the necessity to spend not substantial sums of money but absolutely huge sums of money on upgrading and repairing council houses because of the dereliction that has already taken place by the withdrawal in many cases of Government subsidy. Therefore, the myth that over 100,000 council houses (I may have the figure wrong but I am not far out) could be made habitable ought to be laid. I maintain that the overwhelming number of those could be made habitable if the Government allowed many local authorities to have access to the capital assets raised by the sale of other houses. Most of that funding is still frozen by the Government, so the Government do have a strong role to play.
It is no secret that over the past 10 years homelessness has doubled because those houses are empty. That is not the sole reason, but it is a factor. It is no good the Government saying that the Bill will correct the position. I suggest that if the Bill is unamended it could well be that a local authority, or the local authority tenants (that is who we are talking about) who in many cases are paying financially balanceable rents (I am not saying market rents, but realistic rents) will be asked to fund a takeover by someone who may well be, despite the safeguards the Government have attempted to put in the Bill, a property speculator of the worst kind. On that basis, I commend the amendments and await the Minister's reply. I beg to move.
Lord Renton: Is it not unthinkable that a public sector landlord would part with houses or with land on which houses might be built without receiving a proper consideration? Even if the houses are, as the noble Lord suggested might be the case in some areas, in a dilapidated state and costly to the local authority, I should have thought that the district auditor—quite apart from the Secretary of State, the ratepayers or anyone else—would have something to say if an adequate consideration is not paid.
The noble Lord is attempting to get round a difficulty and uncertainty—and I appreciate what he said—by moving an amendment which requires payment of a positive sum to the vendor. Frankly, the expression "positive sum" is one that I find uncertain in itself. The word "positive" seems to be unnecessary. Either one pays a sum or one does not.

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I do not now what a "positive sum" would mean in these circumstances. In view of what I have said, I would be surprised if my noble friend is prepared to accept the amendent.
Lord Dean of Beswick: As we are in Committee, perhaps I may deal with one point raised by the noble Lord. He implied that no local authority, certainly with the intervention of the district valuer, would dispose of properties at a loss. However, he should know that over the past few years there has been protection for local authorities which mainly applied in London where because the cost of building was so high the actual cost had to be reflected in the selling price. However, the Government legislated some time ago to remove that protection. There are now local authorities in London who have had to dispose of substantially good houses, fairly recently built, at less than replacement value. It is not entirely true to say that a local authority will always come out on the right side. In some areas of London a substantial deficit has been incurred where newly-constructed houses have been sold.
Lord Renton: I take the point about replacement value, although I did not specifically mention it. However, even where property is sold below the original cost because of circumstances which have caused a decline, councils must still receive an adequate consideration, in spite of what the noble Lord said.
Lord Swinfen: The market value of a property is not necessarily the replacement value. If one tried to insure one's house for what one paid for it, the insurance company would, so to speak, probably do it for nothing. The replacement value of any property or item is not necessarily what it cost to build.
I suggest that the meaning of,
"after payment of a positive sum to the vendor"
does not entirely mean what the noble Lord intends. I think the positive sum of £1 could be what is meant, and accepted as what is meant, but I do not think that that is the intention of the noble Lord and his colleagues.
The Earl of Caithness: Amendment No. 125L would, like Amendment No. 132T, mean that tenants' choice transactions could only take place at positive valuations. I believe that is what lies behind the amendments spoken to by the noble Lord, Lord Dean of Beswick. That means it is with a payment in every case to the landlord by the applicant at completion.
In the papers which preceded and accompanied the Bill my right honourable and honourable friends made very clear three points about the valuation of property under tenants' choice. First, property is to be transferred without subsidy from the public to the independent rented sector. The landlords in that sector are engaged in the market place. Accordingly, the right approach to valuation enshrined in Clause 98 is the market value subject to the existing tenancies.
Secondly, if the landlord has fallen down on his statutory and contractual obligations, his payment
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should be reduced accordingly. Thirdly, if after allowing for reasonable repair costs the reduction leaves no value in the property, then it must be right for the landlord to pay a so-called dowry or, in the draftsman's words, a disposal cost to the applicant. This clear point of principle has an important practical implication. Regrettably too many council tenants live in run-down properties. Tenants' choice is meant to help them as much as those in good, well-maintained housing. Our provision for negative valuations will mean that independent landlords will be ready to take on such run-down housing. The results of Amendments Nos. 125L and 132T would close that avenue of hope for tenants in the worst council housing.
I repeat to the noble Lord, Lord Dean of Beswick, that new landlords will be vetted by the Housing Corporation. They will not be property speculators of the worst kind. They simply could not afford to help the tenants in some cases even if the property transferred was at a nominal positive sum of, say, £1,
I hope the Committee will consider this point. Surely we cannot leave tenants in such properties without the practical hope of change that tenants' choice provides.
Lord Stoddart of Swindon: I listened to the Minister with great interest, and I understand the point he makes, However, at the same time we must have some regard to values. A great part of the value of any property is the land upon which it stands. From whatever point of view—whether that of a housing association or a private person—the investment in that land is a long-term investment.
The housing price spiral or boom—call it what you will—has rolled out from London to the rest of the country and in many areas where hitherto the value of property has been low the position has now reversed. In places even as far north as Durham property values have escalated by up to 60 per cent. In East Anglia they have risen by 64 per cent. in the past year. As 40 per cent. of the value of a property is in the land, that means that the land value in many of those areas has increased considerably and is a substantial asset.
I believe that the Minister and the Government have to take note of those new situations. When the Bill was published my guess is that the average price of a house in Manchester was perhaps £18,000. That is possibly a good guess. I believe that the value of a house in Manchester now would be in the region of £35,000 to £40,000. The value of the land upon which that house stands has therefore increased four or five times, and in the case of a house valued in the region of £35,000—if I can do the arithmetic while on my feet—it amounts to £14,000. Therefore it may very well be that though we are handing over a dilapidated property, at the same time we may be handing over a very positive asset within the land that is handed over with that house.
I do not know whether that is clear to the Minister, but I hope it is clear to the Committee because I feel quite sure that all of us, whatever side of the Committee we may be on, wish that the public gets a fair deal and a proper value and price for assets which are transferred to individuals, associations or

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whatever. I beg the Minister to consider the new situation which has arisen as regards land and house values since this Bill was conceived and published.
6.30 p.m.
The Earl of Caithness: I totally agree with the noble Lord, Lord Stoddart of Swindon, that it is essential for the public to get a fair deal. That is where the district valuer, if necessary, can be brought in to safeguard the interests. I disagreed with him when he said that 40 per cent. of the value of any property is in the land. I was a valuer for many years and I know that my noble friend Lord Swinfen is a current valuer. I have never been able to value land and property as accurately as that, and I certainly have never used that yardstick.
Lord Stoddart of Swindon: Perhaps I may say to the noble Earl that the rule of thumb has altered. At one time it was 20 per cent.; two or three years ago it was 30 per cent. Now, in some parts of the country, it is 40 per cent. of the total value of the completed property.
The Earl of Caithness: I cannot disagree with the noble Lord that in some instances it might be; but as a rule of thumb, no.
Lord Dean of Beswick: I shall deal with the point raised by the noble Lord, Lord Swinfen, regarding the forced disposal of a house by the local authority at less than the replacement cost. I may have omitted to make the case, but there may be some argument there that the local authority need not build a replacement house. There are numerous cases of local authorities in London where they have been forced to sell houses at less than the construction costs to sitting tenants who are not long term tenants. The burden of the debt charges on those particular houses has had to be carried by the remaining tenants in the London area. I do not know the particular areas in London; but a peculiar situation has arisen in the London area because of deliberate legislation by the Government.
I have listened seriously to what the Minister had to say regarding the particulars of this amendment and his reply to it. I am not satisfied that what the Minister has said will prevent the type of situation that I suggest may happen. I did not say in the initial stages that I questioned the quality of the landlords. I said eventually. Property is not under anyone's control for time immemorial. When the Minister speaks about dilapidated properties, I have to be a little careful about what I say. In many areas of the big cities some pockets of those cities have substantial rented debts. I know all local authorities pool rents; but I suspect that the massive debts of most areas are in the social stress areas, and that goes without saying. Going back about 10 years, in some parts as many as 50 per cent. of tenants in certain local authority areas were receiving some form of housing benefit.
I was recently reading in the Manchester Evening News(having moved back to that area just before we broke for the Recess) what had happened to rent
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arrears since the new housing benefit regulations came in. In every one of the 10 metropolitan districts that constitute the Greater Manchester Metropolitan Authority there has been a substantial increase in rent debts since the Government's legislation. The point is that if one has 50 per cent. of the houses within a tightly drawn city such as Manchester receiving substantial housing benefits and debts also accruing, where would the money come from to buttress a particular deal to make it attractive enough for someone to wish to buy them? It certainly could not come from the local authority because it does not have the money; it certainly could not come from the general rate fund because if one considers the global situation for that kind of exercise, taking the country as a whole, it would be a tremendous sum of money to find. The point I am making is that if such an exercise developed once again the pbi of the housing section would be the housing tenant who has always been fortunate enough economically and socially to pay the rent the local authority set for him.
However, in view of what the Minister has said, I consider it to be a very involved subject. I ask the Minister to look a little deeper into my further remarks and I would not wish him to answer tonight. I believe the problem is much more involved as regards the transfer of property in some of the socially deprived areas than anyone has thought through. On that basis, I prefer to withdraw the amendment and perhaps wait to hear what the Minister has to say in conversation with me at some future time and then to return at Report stage in order to look at this matter further.
Amendment, by leave, withdrawn.
The Earl of Caithness The Earl of Caithness moved Amendment No. 126:
Page 69, line 14, leave out ("any freehold") and insert ("the fee simple estate in any").
The noble Earl said: In moving Amendment No. 126, I speak at the same time to Amendments Nos. 127, 128 and 129. We have, of course, made it clear all along that tenants' choice should apply, in this Bill, to freehold, tenanted housing. Leasehold property will have to wait for a later Bill. Unfortunately, scrutiny in another place has revealed a difficulty where a public sector landlord owns a freehold but for historical reasons is also a leaseholder.
An example of the kind of thing I mean may help. A local housing authority owns the freehold of a block. Some years ago, it let the whole building to another landlord, a housing association, for instance. The second landlord has let some of the flats on its own account on secure tenancies but leased some back to the freeholding authority, which has let them to its own secure tenants.
If we imagine that an applicant buys the freehold, which is the only kind of interest that the tenants' choice provisions in the Bill deal with, what would be the result? Though the identity of the freeholder would change, the tenants would still be the tenants of the local housing authority and the housing association by virtue of the intermediate interests they held in the property.
Those problems may sound far-fetched; but they are drawn from real life. We therefore need to ensure

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that they do not arise. Amendment No. 129 accordingly makes it clear that the public sector landlord must be a freeholder letting direct to a secure, qualifying tenant or tenants.
Amendment No. 129 also clears up a possible anomaly by ensuring that a qualifying tenant must be a tenant of the relevant public sector landlord, and not of any other intermediate landlord, able to grant secure tenancies under the Housing Act 1985.
The remaining changes are for drafting purposes only. I beg to move.
Lord Renton: I appreciate the problem to which my noble friend has drawn attention. Subject to the use of the expression "fee simple estate" it is solved by Amendment No. 129. The replacement of the word "freehold" by the words "fee simple estate" does not help him to solve his problem. It might be unfair to press my noble friend on this matter at the moment because he may wish to take further advice.
Subject to that advice, I should have thought that the word "freehold", which nearly every lay person understands, is preferable to the expression "fee simple estate" which is understood by lawyers but not by many other people. It is a misleading expression. First, it is not a fee. Secondly, it is not always simple, and my noble friend has drawn attention to circumstances in which it is not. As to the use of the word "estate", that is an ambiguous word in our law. There are various kinds of estate, but there is only one kind of freehold—that is, freehold or, in other words, absolute ownership, subject to certain overriding conditions which sometimes arise of which my noble friend has given an example.
While I sympathise with my noble friend, my suggestion is that either he does not press the amendments at this stage or he gives an undertaking that if the Committee agrees to the amendments, he will consider further on Report whether it would not be wise after all to retain the better understood expression "freehold".
Lord Swinfen: If after further consideration my noble friend still decides to talk about "fee simple estate" should not the expression be "an estate in fee simple'"?
Baroness Fisher of Rednal: Will the Minister explain to those of us, including myself, who are not lawyers, estate agents or chartered surveyors what "fee simple estate" means?
The Earl of Caithness: My noble friend Lord Renton struck a chord with me because I was educated by him during our debates on the Criminal Justice Bill that Bills should be written so that lay people rather than merely lawyers can understand them. As he will be aware, lawyers will be the first to unravel language into layman's terms and so defeat the object of the legislation.
Lord Renton: Why pay lawyers to unravel things when a word such as "freehold" can be used which does not need to be unravelled by lawyers?
The Earl of Caithness: I was coming to the point about "freehold" and "fee simple estate". I was talking in general terms about the drafting of legislation. Both my noble friends Lord Renton and Lord Swinfen commented on that point. The word "freehold" describes the tenure in which the land is held. The expression "fee simple" describes one of the freehold estates which is capable of existing in law.
In Clause 92 we describe the interest or estate owned by the landlord and therefore the words "fee simple" are the more accurate. It is also the expression used in Clause 103 to describe the interest which is conveyed.
I hope that the Committee will accept the amendments. I will look at the point raised by my noble friend Lord Renton between now and another stage.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendments Nos. 127 and 128:
Page 69, line 16, after ("tenants") insert ("of the public sector landlord").
Page 69, line 17, leave out ("any freehold") and insert ("the fee simple estate in any other").
On Question, amendments agreed to.
[Amendment No. 128A not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 129:
Page 69, leave out lines 28 and 29 and insert—
("(3) Subject to subsection (3A) below, a secure tenant of a public sector landlord is a qualifying tenant for the purposes of this Part if (and only if) his secure tenancy is held directly from the landlord as owner of the fee simple estate and, in relation to any acquisition or proposed acquisition under this Part, any reference in the following provisions of this Part to qualifying tenant is a reference only to a qualifying tenant of the public sector landlord from whom the acquisition is or is proposed to he made.
(3A) A secure tenant is not a qualifying tenant for the purposes of this Part if").
On Question, amendment agreed to.
6.45 p.m.
Lord Carter Lord Carter moved Amendment No. 130:
Page 69, line 33, leave out ("to") and insert ("9, 10 or").
The noble Lord said: I shall speak also to Amendments Nos. 132, 136 and 137. This group of amendments is intended to probe the Government's view about the position of disabled tenants who face a change of landlord.
Amendment No. 130 deals with what appears to be an anomaly in the Bill. I should be grateful if the Minister would clarify the position. As drafted, the Bill appears to provide that certain disabled people may be discriminated against by not being allowed to change their landlord. Indeed, their presence in a property might result in everyone in that property being excluded from the right to change their landlord. Disabled tenants might wish to join their neighbours in deciding on another landlord. As drafted, the Bill appears to prevent that action. I am not concerned with the rights and wrongs in principle of a transfer; I wish to discover the Government's view about the rights of disabled people if a transfer is to take place.
Amendments Nos. 132 and 136 deal with a prospective new landlord's policy and intentions with regard to adaptations and alterations for disabled people. The new landlord may not be willing to accept the responsibility for adaptations if the tenant becomes disabled after the landlord takes over. We therefore feel that prospective landlords should be required to set out their policy in that respect. That would help tenants to make up their minds about the new landlord. It would also help tenants to consider the policies of their existing local authority landlord on adaptations and disability and to compare them with the stated policy of the potential new landlord as required under the amendment. Similar provisions should exist for tenants who are already disabled and who need adaptations or alterations to their homes.
Amendment No. 137 is designed to discover whether the Housing Corporation has the power to stop a proposed acquisition by a new landlord proceeding if the corporation is not satisfied with the new landlord's policy towards adaptation for existing disabled people or tenants who may become disabled. Will the new landlord be required by the Housing Corporation to have the duty that local authorities have regarding the provision of adapted housing for disabled people?
This group of amendments is intended to ensure that all tenants, especially disabled tenants, are fully informed about the attitude of prospective new landlords to disability and the provision of adapted housing. I beg to move.
Lord Swinfen: I shall be brief because the noble Lord, Lord Carter, has explained the series of amendments extremely well. The Government should bear in mind that with a gradually ageing population there will be, as time goes on, a greater number of people disabled through age quite apart from illness and accident. In addition, doctors keep injured people with disabilities alive whereas a few years ago they were unsuccessful.
Disability is a problem which could increase. Therefore it is much more important that landlords should make known to their tenants their policies on disability. It would be a terrible pity if the only people who were prepared to produce proper accommodation for physically disabled people were local housing authorities and housing associations. Housing associations obtain their money from the Government through the Housing Corporation. Housing authorities obtain their money, when they receive any, from the Housing Corporation.
We should bear in mind that standards are improving all the time; but it is essential to keep the private landlords up to the same standards as everyone else. It will do them no harm and cost them no money to tell their tenants what their policy is and then the tenant will know that he or she is secure; in other words, should they become disabled they will not have to move elsewhere.
Baroness Fisher of Rednal: I should like to support the amendment which has been so ably moved by my noble friend. However, I should like to ensure that
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those who are suffering from sensory handicaps are also catered for. With all the electronic equipment available in this new technical age there is much service being given to those living in the community who are deaf and blind. One would like to feel that such people are included, as well as those who suffer from physical handicaps.
Lord Renton: I too should like to express my support for the amendments. As my noble friend Lord Swinfen has said, there are many disabled people in this country. Indeed there was a recent survey carried out—the findings of which I must say I find hard to accept—claiming that 6 million of us are disabled. Of course it all depends on what one means by disabled. However, here we are dealing specifically with the physically disabled. It has been acknowledged by Parliament in statutes that public authorities have a duty to do what they can to help such people overcome their physical disabilities. Moreover, we have many voluntary organisations working to the same end.
As we are dealing with a new attitude towards housing, even though it is limited to secure tenancies, I think that we should seriously accept the strong reasons which were given by the noble Lord, Lord Carter, and my noble friend Lord Swinfen. Therefore I hope that my noble friend Lord Caithness will give a sympathetic answer to what has been said.
Baroness Elliot of Harwood: I should like to add one word to the discussion. I was for a long time—10 years, I think—chairman of a housing committee and that was one of the aspects that I was most keen about: that where houses are let to disabled people, the matter should be properly dealt with so that they can live like ordinary human beings, perfectly happily. It can be done, and indeed it was done. However, it was a new idea for many people—and I am talking about a long time ago. But now I think it is done rather hurriedly. It is most important that this provision should be part of any housing Bill, especially a new one.
Baroness Masham of Ilton: I too should like to support these amendments, as does my noble friend Lady Darcy (de Knayth) who is not too well at present. On the issue of housing, I must say that many disabled people have had a raw deal. My noble kinsman the Minister knows full well about such problems. Therefore I hope that he will give the Committee a sympathetic and helpful answer because many disabled people will be watching what is done by the Committee in respect of this matter.
The Earl of Caithness: I must say that I am sorry to hear that the noble Baroness, Lady Darcy (de Knayth) is not well and I am sure that all Members of the Committee will wish to join me in sending her our very best wishes for a speedy recovery.
Noble Lords: Hear, hear!
The Earl of Caithness: These amendments seek to impose two main changes to tenants' choice. First, to allow disabled tenants living in special housing to

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participate in tenants' choice; and, secondly, to ensure that applicant landlords must keep tenants, and the Housing Corporation, informed of their proposals and of their policy towards the disabled and that the policy should be a factor in deciding whether or not an application may proceed.
Amendment No. 130 would remove the exemption for tenants' choice of all tenants living in housing specially adapted for the disabled. It would leave unchanged the exemption of housing specially suitable for the elderly. Members of the Committee may ask why the disabled should be excluded from our tenants' choice initiative. In principle tenants' choice is aimed at opening up to competition the closed world of local authorities' general purpose rented housing. The housing covered by the paragraphs of Schedule 5 to the Housing Act 1985, which would be affected by Amendment No. 130, is by definition very specialised. Therefore we decided that specialised housing should not be open to purchase under tenants' choice, even though the purchasers would be approved social landlords who would subscribe to the tenants' guarantee.
I am sure the Committee will appreciate the tension here. We wish to give existing disabled council tenants full and equal rights with the able-bodied. However, there is a case for saying that housing authorities should be able to decide whether to retain specialised housing for those who need it in the future. We decided to follow the arrangements for the right-to-buy scheme. But I am willing to weigh the matters again, especially in the light of our future deliberations on Amendments Nos. 148 and 180, when we shall look at the right-to-buy precedent again. I believe we shall reach that stage tomorrow and as we wish to keep these two opportunities for tenants on parallel lines, perhaps we can return to the matter at a later stage in the Bill's proceedings when I shall be happy to discuss it with the noble Lord, Lord Carter.
I turn now to Amendment No. 132. The amendment would require that when an applicant landlord makes an application he must offer a statement of his policy towards the disabled. Amendment No. 137 would allow the Housing Corporation to prevent the applicant from serving a notice of intention to proceed, unless it is satisfied that the statement of policy will meet the needs of the disabled.
We believe that the two amendments are not needed. First, an applicant must be formally approved by the Housing Corporation before he puts in an application under Clause 95. The Housing Corporation will take into account many factors in deciding whether or not to grant approval. We shall ensure by issuing direction to the corporation that one of the conditions of any approval will be an undertaking from the applicant to abide by the tenants' guarantee.
Among other things, we intend that the tenants' guarantee will require landlords to pay special attention to the specific housing difficulties experienced by particular groups, such as the disabled. Perhaps I may quote from the draft document, from which I read earlier this afternoon,
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which was issued by the Housing Corporation on 3rd August. It has gone out for consultation to organisations, including those who represent the disabled. The passage is contained in Annex A3:
"Tenants' Choice landlords are expected to pay special attention to the specific housing difficulties experienced by particular groups including ethnic minorities, women suffering domestic violence, the disabled, and carers."
Therefore it is set out clearly before us. The corporation will take into account an applicant's policy intentions, and in monitoring performance it will take account of his execution of those intentions. If the corporation becomes dissatisfied with his performance—for whatever reason—in the course of an application, it could revoke approval and prevent the application from proceeding. The corporation can already do this under powers on the face of the Bill. It is unnecessary to give it explicit powers to do so in relation to a specific requirement when a whole structure already exists to allow the corporation to do it in relation to a wide range of exhaustive requirements which we wish to impose. So I would ask Members of the Committee to agree with me that these provisions simply duplicate existing controls and by doing so might be thought to devalue the force of the many other provisions which are in the guarantee but are not stated on the face of the Bill.
Finally I turn to Amendment No. 136. This would require all disabled tenants to be told by the applicant about his proposal and especially about his proposals in relation to property adaptations or alterations for the disabled. I must emphasise that one other undertaking required by the corporation will be the requirement to keep tenants—whether disabled or not—informed at all stages of the tenants' choice procedures and timetable. Moreover, the applicant will, in setting out his proposed tenancy terms before them, make his intentions clear about the way he proposes to run the property, and about any improvements. Any offer he makes at this stage will be contractually binding. Once again, I see no need to duplicate requirements already met by other means.
Lord Renton: Before my noble friend leaves the point, perhaps I may ask this question. Can he say whether that is something which is just hoped and believed that the applicants will do, in a way which includes the needs of physically disabled tenants, or will there be an obligation to refer to their needs in the course of the statement that will be made?
7 P.m.
The Earl of Caithness: The wording is:
"Tenant's choice landlords are expected to pay special attention to the specific housing difficulties".
It will be for the housing corporation to vet potential alternative landlords to the local authority and to make sure that they take account of a wide variety of people who need low-cost housing and who have particular problems—indeed, I mentioned some of them.
We believe that the specific points raised by the noble Lord, Lord Carter, and by my noble friends are catered for under the guidance given by the Housing Corporation. I shall come back to Amendment No. 130 (and that depends on our consultations

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tomorrow) but the gist of what I am saying is that this is a very important area for the disabled. We believe that it is already covered in the tenants' guidance. There are other important matters that are also covered by tenants' guidance, but to put the disabled on to the face of the Bill, although it is an important matter, would in fact devalue the other matters which the future applicant landlords will have to take into account.
Lord Renton: Before the noble Lord, Lord Carter, replies, I wonder whether I may draw attention to the following. My noble friend has said that guidance given by the Housing Corporation would be as effective as a statutory provision written into the Bill as a result of these amendments. Speaking for myself, I find that rather hard to accept.
The Earl of Caithness: I am sorry if I gave that impression. That is not what I meant to say. What I meant to say and what I hope I did say was that the very anxieties that have been expressed are already taken care of by the document which the Housing Corporation has produced. As I said to my noble friend Lord Campbell of Alloway earlier this afternoon, that document does not have the force of law, but at any time during the consultation exercise the Housing Corporation can withdraw its approval of a proposed landlord if he does not meet the stringent tests that the Housing Corporation sets out. Moreover, if that transaction has gone through it can monitor that new landlord at any time and may withdraw the approval that he has.
Lord Swinfen: Before my noble friend sits down, would he consider asking the Housing Corporation to make it mandatory for the proposed new landlord to set out what his ideas and proposals would be towards helping a person who becomes disabled—not someone who is disabled now but someone who becomes disabled later while a tenant of the new landlord? Particlularly as regards people who are past middle age and becoming elderly, there is a greater chance of their becoming disabled in one way or another, and therefore this is of great importance to them.
While I am on my feet I should like to mention one small point. My noble friend talked of the disabled. People who are disabled like to be known as people and prefer to be called disabled people. In working with disabled people this point has been brought home to me many times in the past, and I do not see why it should not be given wider prominence.
The Earl of Caithness: I shall certainly look at the point which my noble friend has raised, which is the valid point concerning not only those people who are already disabled people but those people who might become disabled people.
Lord Carter: I am grateful to the Minister and to other noble Lords who have spoken on this. I understand that the Minister is in difficulty on Amendment No. 130 and why he wishes to reserve his position until the discussions tomorrow. As to the
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rest of it, I have to say that in our discussions of a number of Acts and Bills we always hear the words: "It is all looked after. It does not need to be on the face of the Bill. The intentions are there". Those are fine words, but they do not adapt many houses.
I am not entirely satisfied with the draft guidance, which does not make it mandatory for a new landlord to carry out improvement, as the noble Lord, Lord Renton, has said. It is virtually left to his good intentions. I should like to read very carefully what the Minister has said and then consider what amendment is required on Report. I beg leave to withdraw the amendment.
The Earl of Caithness: Perhaps I could offer the noble Lord the opportunity to come and discuss it with me at any time. I should be happy to do so between now and another stage.
Lord Carter: I am grateful to the noble Earl.
Amendment, by leave, withdrawn.
[Amendment No. 130A not moved.]
Clause 92 agreed to.
The Earl of Arran: I think that this might be a convenient moment to break for dinner. I suggest that we return to the Committee stage of the Bill at 8.5 p.m.
[The Sitting was suspended from 7.5 to 8.5 p.m.]

Housing Bill
House again in Committee.
Clause 93 [Persons by whom right may be exercised]:
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 130B:
Page 70, line 7, at end insert ("such criteria shall at least include the following—

(a) the applicants' housing management experience;

(b) the applicants' housing management performance;

(c) the size of the applicants' existing housing stock in relation to the number of dwellings to be acquired;

(d) the applicants' arrangements for consultation with their existing tenants;

(e) the applicants' policy with regard to—

(i) allocations,

(ii) rent levels,

(iii) rent review procedures,

(iv) repairs,

(v) improvements,

(vi) equal opportunities,

(vii) standard terms of tenancy offered;

(f) the applicant's local connection and interests;

(g) the applicant's accessibility to tenants;

(h) the applicant's financial standing and stability;

(i) the applicant's sustained and continued commitment to rented housing provision for those in need; and ").

The noble Lord said: I beg to move Amendment No. 130B. I believe it is for the convenience of the Committee if I also speak to Amendments Nos. 130C and 130D because they are related. They deal with a matter which has been raised in other amendments. Our concern is that, if at all possible, it should not be

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left to others to lay down criteria. Perhaps I may remind the House that Clause 93(3) says:
"The Corporation shall establish (and may from time to time vary) criteria to be satisfied by a person seeking approval under this section".
That series of amendments is seeking to insert on the face of the Bill the kinds of things we believe the Housing Corporation ought to have in mind when it is considering the acceptability and even the advisability of inviting certain groups, certain associations, to undertake these matters. I hope that the Minister will not disagree with many of the points itemised in the amendments. He will listen carefully, and he may very well tell us that there is no reason and no need to provide for those matters because they are kinds of things which the Housing Corporation would naturally be concerned about. The Committee should bear in mind that the Minister does not have to satisfy just Parliament or the Housing Corporation—he does not even have to satisfy himself—that these matters are proceeding fairly, justly and sensibly. However, he must satisfy the millions of tenants throughout the country that their interests are being looked after by a new kind of landlord.
We could get into an argument about the record of local authorities, as opposed to the kinds of bodies that the Housing Corporation has traditionally (and I believe, successfully) looked after; that is, housing associations, co-operatives, etc. We could get into an argument as to whether the record of management by the Housing Corporation is as good as, better than or worse than that of councils. We are not arguing too vigorously on that point.
Perhaps I may very quickly go through Amendment No. 130B. We want to know, and people will be invited to say, that this association is fit and proper to be their new landlord. We want the criteria to include first of all the applicants' housing management experience. The Minister might say, "'Surely the noble Lord does not believe that someone would be put on the approved list unless that person could satisfy the Housing Corporation that he had adequate housing experience". However, it must be said that the Housing Corporation is peopled by nominees of the Government; that it is the prime instrument of the Government in carrying forward this Bill; and that it will be looking for groups and associations, especially housing associations, which it believes will be not only capable but willing to carry out every jot and tittle of the Government's intentions.
Therefore, we want to know about an applicant's experience and performance. We do not want a group of tenants suddenly to find that they have a new landlord and that his performance leaves a great deal to be desired. We are not talking about a long period of success. We are asking to be told what an applicant has achieved and what it has managed. We are asking to be told what the applicant lays great store by.
We also want to know about the record of the possible new landlords regarding consulting their tenants. The Minister from his long experience in these matters will share our view that far too many councils have not had a good record of consulting their tenants. That situation often occurs where the
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political control, whichever side it may be on, decides that the council in question does not need to consult tenants and that there is no mileage in consulting tenants. Some councils have a bad record. We want to know what kind of a record applicants have as regards consultation.
We also want to know what policies applicants are likely to follow. The Minister may say that they will not have any choice in the matter and that they will be told what policies to follow. However I do not think he will say that. If he does, he will be riddling the argument of tenants' choice and the freedom of housing associations to exercise their abilities.
Reference has been made to rent levels. The noble Lord, Lord Ross of Newport, told the Chamber about a housing association which I would have said was an eminently acceptable one. He mentioned the North British Housing Association which has a good record. But I seem to recall the noble Lord telling us of a tenant of that association who is faced with an astronomical rent.
We want to know about the policy of applicants as regards:

"(iii) rent review procedures,

(iv) repairs,

(v) improvements,

(vi) equal opportunities,"

and other matters mentioned in our amendment. We want to know a little about the people in housing associations. Gone are the days when housing associations were very much peopled by those who were primarily interested in housing with a capital H. Far too many of them are now run by groups of people who are concerned with profit with a capital P. They are in housing for the money. We are not talking about making large sums of money; but the raison d'étre for far too many housing associations is to make a profit out of housing rather than to make housing serve the needs of the people who are to be their tenants.
Therefore we want to know a little about applicants. We want to know a little about their financial probity and their financial record. We also want to know what they intend to do with housing which is transferred to them where subsequently the tenant decides to leave. In the normal course of events if the house concerned had been a council house, it would then be available for the rented sector and those on the council housing list. We want to know what applicants' intentions are in those circumstances.
The Government may say that all these matters are the kind of things that the Housing Corporation would look at. But we want the Minister to satisfy the people who will be affected—that is the tenants—that the Government's procedures will satisfy broadly the kind of anxieties that I have mentioned. We may have been too ambitious; but all of the things we are asking for have been mentioned to us. The Minister will know from his experience that a tenant on a council estate may have decided, whatever his circumstances, that owning a house is not for him. Therefore that tenant will be very concerned about the quality of the new landlord and his care and concern for his

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tenants. We think these are the kind of things that a tenant would want to know about.
I wish to mention the other amendments grouped with this one. Amendment No. 130C seeks to insert in the Bill a provision that an approved landlord will be proposed:
"only after consultation with that person's existing tenants".
The old phrase asks us why we should look into the crystal ball when we can read the book. By that analogy, why should we worry how a new landlord will look after his tenants if we can ask some of his tenants now how he looks after them?
This provision is a big step and we want to make sure that we examine the credentials of the new landlord. For instance, we do not want to find that we have broken up large public sector monopolies only to create a large private sector monopoly. Further, we want to know what the record is regarding a new landlord carrying out promises. Amendment No. 130D asks that a new landlord's undertakings:
"shall be reviewed on a regular basis of every two years or at the request of a majority of existing tenants of the approved landlord."
I believe the Minister said earlier that the Housing Corporation would reserve the right to monitor the performance of a new landlord and reserve the right to terminate the agreement. In other words, if the new landlord turned out to be a bad new landlord, some powers would exist as regards terminating an agreement. We are attempting to place that provision on the face of the Bill. I beg to move.
8.15 p.m.
The Earl of Caithness: When the noble Lord, Lord Graham of Edmonton, mentioned tenants' choice he invariably referred to the potential landlord as a housing association. I was willing him to say that tenants' co-operatives will also act as future landlords, and to say how important that will be for tenants.
Lord Graham of Edmonton: I was thinking of potential bad new landlords. The idea that a cooperative would be a bad new landlord never crossed my mind.
The Earl of Caithness: I am glad that I gave the noble Lord the opportunity to clarify his exact position on that matter. I could not agree more with the basis of what the noble Lord was saying, which was that it was important for tenants to know in advance what their situation will be and what the future holds for them. But I must say that we have always thought it better to give the corporation the responsibility to establish criteria, drawing on its existing experience and on its recent consultation exercise. Perhaps those criteria have changed more than anything since discussions took place in another place—probably since the amendments were put down—as a result of the consultation that has gone on this summer on the Housing Corporation's documents.
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We have not thought it helpful to tie it rigidly to statutory criteria. I appreciate that this list is not intended to be exhaustive, but inevitably where such a list appears in a Bill there is a tendency to give undue weight to the matters listed at the expense of other very important aspects which may be set down elsewhere.
I should point out also that this approach follows the precedent of Section 5 of the Housing Associations Act 1985 which similarly empowers the Housing Corporation to establish criteria for registration of housing associations, but which does not attempt to put actual criteria on the face of the legislation.
But some of the factors identified in this amendment will be relevant to all, and all of them relevant to some, approvals. In considering all applicants, the corporation will have to look at housing management experience and performance (embracing satisfactory arrangements for tenant consultation) financial status and stability. Where appropriate, the corporation will no doubt also take account, when looking at management performance, of the views of applicants' existing tenants, as suggested in the proposed amendment.
The location of applicants' existing activities and their local connections will have a bearing on approval. The approval criteria, which have been circulated in draft by the corporation for comment by those concerned and which many members of the committee will no doubt have seen, will set standard terms of tenancy, based on the tenants' guarantees developed for housing association tenants, as the least which all approved applicants must offer. They include the continued commitment to renting which I know the noble Lord wishes to see. They will also, among a very stringent and comprehensive set of requirements, require applicants to have regard to local needs in their allocation policies, including equal opportunity aspects. Regulations under Clause 101 will require landlords to spell out their proposals for repairs, improvements, rent levels and rent review procedures.
Turning to Amendment No. 130C, taken with this group of amendments, the approval criteria which the corporation will establish will cover, among other matters, management experience and performance. These matters are referred to in paragraph 9 of the explanatory document published last June. I confirm that the corporation will indeed be looking at track record on these matters when considering applications for approval. It has now published the draft approval criteria which make this clear. So, again, we have met the noble Lords' underlying concerns.
I agree too that during the preliminary stages tenants affected will often want to compare notes with applicants' existing tenants. I would expect the applicants, prompted if necessary by the corporation, to arrange this as a natural part of setting out their stall, though the exact content of these initial tenant applicant contacts are surely best left to the mutual interest and good sense of the two parties, with the corporation holding the ring as necessary. There is surely no need for a statutory requirement. The

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tenants' most substantial safeguards will lie elsewhere—in the preliminary competition as a whole, in the supervision exercised by the corporation before and after transfer takes place and in the whole range of other safeguards that the scheme will make available to tenants.
If the tenants were frustrated in an attempt to find out more about their prospective landlord it lies in their own hands to reject his proposals either at the preliminary stage or in the formal consultation.
Finally, turning to Amendment No. 130D, after the statutory procedures begin, the corporation will as a matter of course keep tabs on applicants' progress for consistency with the approval criteria and undertakings. Clause 93(5) makes it clear that failure to meet criteria or fulfil an undertaking required as a condition of approval could lead to revocation of that approval. If approval were revoked before the completion of the transfer—Clause 93(5) sets out the procedures for revocation—the transaction would of course fall.
The amendment of the noble Lord, Lord Graham of Edmonton, would require approvals to be reviewed on a two-yearly basis. I do not believe that that is good enough for the tenants. I envisage that there will be annual elements in the corporation's monitoring of approved landlords. Submission of annual accounts is an obvious example. On broader questions of management performance, which I suspect is what the noble Lord has mainly in mind, I see no reason for setting a regular review period. This is because, in the sense that the corporation would be able to look into any matter which bore on a landlord's approved status as and when it arose, its review of approved status could be continuous. I certainly cannot envisage it not looking into tenant complaints about management at whatever stage they are raised.
As the noble Lord, Lord Graham of Edmonton, said, these are important points for tenants to be aware of. I hope that I have been able to clarify the situation for him.
Lord Graham of Edmonton: I am grateful to the Minister. I sense that he understands the importance to the tenants of the criteria listed in the amendment. I think that he is saying in effect that no landlord will be approved who does not satisfy the Housing Corporation as to his ability and his intention to fulfil 'what I call the good landlord provisions.
However, the noble Lord has more faith than I have in either the cash or profit nexus in housing. Although we had an exchange of views on the comparative worth of housing associations and cooperatives, those are not the only two groups which will be likely to figure as approved landlords. There will also be individuals, private companies and groups of people who put themselves forward as suitable to act as the agents of the Government.
I believe that the greatest safeguard lies in the fact that the reputation of the Housing Corporation rests on its ability to include on its approved list those it believes not only will do a good job but also will not let it down. The Housing Corporation will be very
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careful if it wants to keep itself out of trouble, in addition to doing what the Minister wants it to do, and not to be found in dereliction of its duty if in a year or two's time a new landlord turns out to be a really bad landlord. I am grateful to the Minister for pointing out that, by and large, the points I have spelt out are those which are likely to be used by the Government and the Housing Corporation as measuring rods.
The only point which disappoints us is that unless there are known criteria against which performance can be measured, it is all very well for the Minister to say that he is satisfied, for the Housing Corporation to say that it is satisfied and for the new landlord to say that he is satisfied. We who are on the outside want to know what is the target, what landlords have to do to satisfy the Housing Corporation. I belive that a great many questions will be raised and that the Minister and the Housing Corporation will turn round and say that they are satisfied that landlords are doing a reasonable job.
I am grateful to the Minister. We shall look at what he has said with a view to consulting those who have advised us about their concerns. In the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 130C and 130D not moved.]
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 130E:
Page 70, line 29, leave out from ("if") to ("revoke") in line 31 and insert ("on review of the approved landlord it is found that his performance and service fall significantly short of the agreed criteria for approval, the corporation shall").
The noble Lord said: On page 70, line 29 reads:
"Subject to any directions under section 76 of the Housing Associations Act 1985, if it appears to the Corporation appropriate to do so (whether by reason of a failure to honour an undertaking or to meet any criteria or for any other reason), the Corporation may".
I think I read the wrong line, but I believe the Minister knows what I mean. What is a missing line between friends?
We prefer the words:
"on review of the approved landlord it is found that his performance and service fall significantly short of the agreed criteria for approval".
The purpose of the amendment is to deal with two or three possibilities. First, a false prospectus may be issued by a group or association in the sense that they have not told all of the truth as to what they intend to do and have deceived or misled the Housing Corporation. The corporation has its own monitoring system and measuring rod, but nevertheless I believe that it can genuinely and innocently be taken in.
It may also be found that in its performance the Housing Corporation has not been up to the task. Not everybody is capable of managing housing. I am not talking about building houses or collecting rents; I am talking about having the ability and resources in 1988 and later to transform housing that once was municipal and to maintain it as a living entity and as a community. It may be that the corporation believes that it can do that but falls down on the job.
This is part of the general attack that we are making on the rather stultified part of the Bill which does not take into account the fact that we have to be able to measure the performance of—I shall not get involved with the terminology—the new landlord, whoever it is. There has to be an opportunity to exercise one's right in the ballot. We believe that these amendments make it much more easy for the Government—that is, the Housing Corporation—to change a new landlord if he turns out to be a bad one. I beg to move.
8.30 p.m.
The Earl of Caithness: I believe I am right in saying that when moving Amendment No. 130E the noble Lord was also speaking to Amendment No. 130F. The intention of Amendment No. 130E is to strengthen the sanction that revocation of approval would provide against landlords who did not meet the terms attached to their approval under Part IV after they had acquired property. Conversely, however, I am advised that the effect would actually be to weaken this sanction. The only ground for revocation, if the amendment were accepted, would be performance and service falling significantly short of the agreed criteria for approval. This could marginally limit the corporation's freedom of action on revocation in a way that would be unwelcome and, I believe, unhelpful to the tenants.
We must look elsewhere for sanctions against successful applicants who fall down on the job after transfer. The first point to make however is that applicants for approval will have to meet stringent criteria which would help to make serious under-performing very unlikely in the first place. When approval has been given, the corporation will be watching for any failure to live up to those criteria and the sanction of revocation would be available when necessary. Before completion it would cause an application to fall; after completion it would prevent the applicant from making new applications.
In the event of poor performance after completion, Clause 49 of the Bill would give the corporation the ability to use its powers under the Housing Associations Act 1985 if necessary to ensure that tenants' choice landlords who were registered housing associations, as very many will be, stuck to the terms of the tenants' guarantee. As adherence to the tenants' guarantee is a condition of all tenants' choice landlord approvals, tenants will also by this time already have legally enforceable contractual tenancy agreements which they entered into on transfer and which reflect the landlord's obligation to tenants contained in the tenants' guarantee. In some special cases, for example, where issues were particularly complicated, or where a point of principle was involved, tenants could receive assistance in resolving disputes with their landlords from the corporation under Clause 106 of the Bill.
I put it to the Committee that these are significant and very genuine safeguards. I do not believe that Amendment No. 130E would add anything to them. I suggest that they are also far preferable to the very
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long drawn out and complicated form of reverse compulsory purchase that, by providing for the principle of disentangling completed transactions when approval had been subsequently revoked, Amendment 130F would imply.
In the light of the very considerable safeguards already provided for, I hope that the noble Lord will agree that what we have done in the Bill probably provides a wider scope for the corporation than does his amendment.
The Earl of Selkirk: I should like to ask one question of my noble friend: how long do the criteria which are laid down continue? Suppose that a landlord sells his property, do the criteria continue as a real burden on that property indefinitely in the future, or at what time can anybody get rid of it? As I read the Bill at the present time, this is something which could be regarded as a continuous obligation resting on the proprietor of a certain property. The criteria will remain indefinitely on that property. Is there any way of removing that burden which very much affects the value of the property? Is there any intention on the part of the Government that it should remain absolutely indefinitely on the property for all time.
The Earl of Caithness: The intention of the approval of a future landlord under tenants' choice is to confirm one who will be in the long term business of renting property. That applicant therefore has to pass very stringent tests set out by the Housing Corporation which I have spelt out. The landlord will have to enter into binding tenants' guarantees which will apply for as long as the tenants are there and for future tenants.
The Earl of Selkirk: Obviously, it applies to the original landlord but the question I put was whether, in the case of another landlord taking it on, it will apply indefinitely in the future to all landlords who own that property; in other words, is it a real and continuous burden?
Lord Swinfen: Before my noble friend answers that question, is it intended that there be covenants that run with the property and therefore cannot be avoided by any future purchaser?
The Earl of Caithness: The future disposal of property, which I think is the point raised by my noble friend Lord Selkirk, is of course strictly controlled. The applicant who becomes a tenants' choice landlord cannot next day suddenly dispose of the property, because he will need the Secretary of State's approval. The whole purpose of this measure is to provide the kind of guarantees for which my noble friend is looking. However, one can envisage a situation, remote though it may be perhaps, in which a housing association has run into genuine difficulties or perhaps there is a tenants' co-operative which has run into difficulties.
Lord Graham of Edmonton: Or a private owner.
The Earl of Caithness: Or a private owner who becomes a tenants' choice landlord and runs into difficulties. It might be that instead of renting, with the Secretary of State's approval it is agreed that he can dispose of two or three units. The basic point that I am trying to get across is that these properties are for renting in the future. That is what we wish to ensure.
Lord Swinfen: Can my noble friend tell the Committee where in the Bill it states that the purchasing landlord needs the Secretary of State's approval for a purchaser of his interest?
The Earl of Caithness: Yes, I can—in a moment, I hope. I shall come back to my noble friend if I may.
Lord Graham of Edmonton: The noble Earl has gone some way to supplement and augment our concerns. I believe that in one of his phrases he said that the new tenants' choice landlord would have to satisfy the stringent criteria that would be laid down. On the basis that he has to satisfy those criteria before he is accepted on the approved list, we are concerned that those stringent criteria—although they may very well be known to the new landlord because he has already met them, to the Housing Corporation and to the Government—should be made public knowledge. Can the Minister assure the Committee that they will be public knowledge? It may be that I have not read the Bill aright, but I am anxious on that point.
If the criteria are a secret and the tenant, who is the main interested party, is not aware of what it is that the new landlord has agreed to be stringently bound by, then of course the situation is a charade and a sham. I am not saying that it is such a thing but it would be if that were the case.
I intend to withdraw the amendment, but this matter is worth discussing for a minute or two. We are concerned that it is clearly the intention of the Government to break up municipal housing as it now exists. The Government have their reasons but that is their intention. On the break-up they intend to transfer housing to other forms of ownership. Some I agree with—some I do not.
The noble Earl, Lord Selkirk, and other noble Lords are concerned about the possibility that in the first flush of a new Bill, no matter what are the intentions to protect the tenants, it may not be very long, as we know from experience, before a case is put to the Secretary of State either to ease or allow the new landlord to exercise some rights and break up his holding further. Before one knows where one is, council housing, which I consider to be a very good form of tenure, will not only change into diffuse ownership but will also be broken up into very small parts. That would be regrettable. Before I withdraw the amendment I should be grateful to hear if the Minister has any other comments.
The Earl of Caithness: I am grateful to the noble Lord. I think that he is unduly pessimistic. One hopes
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that through the very careful vetting of the Housing Corporation procedure any potential trouble will be kept to an absolute minimum. The idea is not in any way to permit a further break up. Of course a local authority has the power under existing legislation to dispose of units of its own accommodation. However, I reaffirm that our intention is to make sure that those who take on the role of landlord, the tenants having voted on it, keep the property as rented property. That is the idea.
I have now found the answer to my noble friend Lord Swinfen for which I was looking. Perhaps I may refer him to Clause 104(1) in particular.
Lord McIntosh of Haringey: While we are on the subject and before the noble Lord, Lord Swinfen, speaks again, the Minister's noble friends were seeking his assurance that the obligations were continuing. I am not sure whether the noble Earl wanted them to continue because he described them as a burden. However, on this side of the Committee, we want them to continue. Our Amendment No. 140B refers to this exact point. It proposes that the onward disposal of the property by an approved landlord should be only to an approved landlord, Perhaps this is an appropriate time for the Minister to indicate that he supports that amendment.
The Earl of Caithness: I thought the noble Lord might be tempted to come in on that amendment. He will recall that I said that the criteria—and they are a burden on some landlords, and rightly so—will continue as long as the leases remain unaltered on transfer. But I said that if there were the odd occasion when a tenants' co-operative had run into trouble, or indeed any future landlord had run into difficulties, it might be a better solution not necessarily to have an approved landlord.
It rather precedes what we shall debate on the amendment of the noble Lord. I now expect that he will not raise it because I have given him the answer.
Lord Graham of Edmonton: I am grateful to the Minister for going some way to reassure the Committee. However, he used the word more than once that it is the "intention" of the Government. I very much hope that the Government are satisfied that the legislation which gives effect to their intention is completely in place. Once matters go out of this Chamber and begin to be implemented, if the intention is thwarted either by sloppy legislation or a failure to perceive the intent, then we are in serious trouble.
I appreciate what the Minister has said. Those outside the Chamber will read what he has said. Perhaps we shall come back to this matter later. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 130F not moved.]
Clause 93 agreed to.
Clause 94 [Property excluded from right]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 130G:
Page 71, line 14, at end insert—
("(1A) In the application of subsection (1) above to property falling within section 92(l)(b) above, a building or part of a building which, apart from this subsection, would not be regarded as occupied for residential purposes shall be so regarded if—

(a) it is or is intended to be occupied together with a dwelling-house and used for purposes connected with the occupation of the dwelling-house; or

(b) it is or is intended to be used for the provision of services to a dwelling-house which is comprised in a building falling within section 92(1)(a) above.").

The noble Earl said: This is a technical amendment. It is intended to ensure that certain buildings clearly suitable for inclusion in an application by virtue of Clause 92(1)(b) and which satisfy that provision cannot then be excluded by virtue of Clause 94(1). I beg to move.
On Question, amendment agreed to.
Clause 94, as amended, agreed to.
[Amendment No. 131 had been withdrawn from the Marshalled List.]
Clause 95 [Application to exercise right]:
8.45 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 131A:
Page 71, line 47, leave out ("and").
The noble Lord said: We are here turning to the issue of the pre-selection stage. We are concerned with the issue of the publicity given by local authorities and the involvement of local authorities in the pre-selection stage. I should like also to speak to Amendment No. 132D. We are making the contention about the local authority—the existing landlord. It is very confusing because the Bill does not use the words "local authority" for landlord. It does not use the word "applicant" for the private landlord—what I call the putative landlord. It uses other words which confuse the outside world. I gladly give way.
The Earl of Caithness: I am sorry to interrupt the noble Lord. For the sake of clarification, is he also speaking to Amendments Nos. 132A and 132B, as well as Amendment No. 132D?
Lord McIntosh of Haringey: I am grateful to the Minister. That is indeed the case. The argument that we are making in all these amendments is that the local authority—the existing landlord—has an important part in the pre-selection procedure. We want to ensure that the local authority is not inhibited by the Local Government Act 1988 which saw its passage through this Chamber only a few months ago. It is all very well to talk as if the disagreement, if there is to be disagreement—and there very often will be—between the two parties who are seeking the control of these properties and their secured
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tenancies is a disagreement between two suitor landlords of equal status.
So far as concerns the tenants they do not see it in that way. It is not a choice between two new options; it is a choice between a change which they may or may not want, and no change at all—in other words, staying with their existing landlord which is the local authority. If the tenants are to be given an opportunity to grasp this option fully then they must compare the alternatives put forward by different suitor landlords, and ensure that the local authority—the existing landlord, the no-change option—is part of what has been rudely called the beauty contest.
The problem is that the local authorities are much more restrained in respect of the publicity in which they are allowed to engage by the Local Government Act 1988 than any of the suitor landlords may be. I do not expect that the arguments which the local authority may wish to put to its tenants about the advantages of staying with the local authority rather than moving away may be overtly and implicitly party political. But there is always the risk that local authorities jump before they are pushed. They are afraid of challenges being made to the legitimacy of their actions. I am afraid that there are far too many examples of that already with respect to Clause 28 of the Local Government Act.
In these amendments we seek to make sure that local authorities have a free hand within the law—but within a reasonable law—to put forward a case which deals adequately with the arguments being put forward by the suitor landlord.
Amendment No. 132A in the same group has the intention of making sure that there is a pre-selection procedure—in other words that this step in the argument is not cut out by the Housing Corporation. It has the intention of seeing that there are minimum standards of information which will be used in this procedure.
At the moment public sector tenants have the privilege that the decision-making process on how their homes are managed is accessible to them. They know what is going on because of the local government legislation 1982 and the 1985 legislation on access to information. When they transfer to another landlord, and in particular to a private landlord, they do not have the statutory protection which they have when the local authority is their landlord. Therefore we must see to it that they have as much information about the landlord to whom they may be asked to transfer as they do about the local authority. Again it is important that that information should be made available at the pre-selection stage so that a realistic judgment can be made.
Amendment No. 132B is again insisting that there should be a pre-selection procedure. It ensures that those affected by the transfer are consulted at that stage. The Government have always said that this is an important part of the change of landlord procedure for secure tenants, but it is curious that we do not find any reference to it in the Bill. It is not good enough in this respect for a housing association to be left to make regulations. There are a number of

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complexities which, with the best will in the world, the Housing Corporation cannot communicate as directly to tenants as the local authority who knows them can. There are complexities about who the qualifying tenants are, whether they are sole or joint qualifying tenants, spouses of qualifying tenants or persons eligible to succeed under Sections 87 and 89 of the Housing Act 1985. These are examples of the complexities for people who should be consulted when their right to succession to the property is at risk if a new landlord takes over from the local authority. If there is no risk, that can be made clear. Our amendments do not in any way make that less likely.
It is important that there should be a statutory obligation that all these matters of information are made available by local authorities at the pre-selection stage. That should be included in the Bill to ensure that local authorities recognise and implement their responsibilities. I beg to move.
The Earl of Caithness: My honourable friend, who was my predecessor as Minister for Housing, made it clear in another place that the Housing Corporation would, wherever possible, arrange for an informal preliminary competition between more than one alternative potential applicant where there was tenant interest in the possibility of transfer. The noble Lord, Lord McIntosh of Haringey, used the dreaded words "beauty contest", which I have tried hard to avoid today.
My honourable friend made clear that the Housing Corporation would establish which of the competing potential applicants had the clearest support among tenants and that only the potential applicant with the clearest support in each case would be able to go ahead with the formal transfer procedures. Where there was no significant support for any potential applicant, there would be no formal application. We now envisage that the corporation will require potential applicants to demonstrate, in principle, support from at least 10 per cent. of secure tenants before being allowed to go ahead. These requirements will be set out under the corporation's powers to attach conditions in the form of undertakings to approvals under Clause 93. The very service of a notice under Clause 95 will be evidence to the landlord that the applicant has, as appropriate, gone through the preliminary procedures.
I should make it clear, however, that some applications may not in practice be preceded by a preliminary competition. This might happen, for example, in cases where it was clear to the corporation that there was overwhelming support for a new, tenant-led initiative such as a co-op or community-based housing association or where only a single landlord was interested in spite of the corporation's efforts to set up a competition. Where there was no competition, the applicant would, of course, still have to demonstrate the minimum "in principle" support I have described before he was allowed to go ahead.
The second part of Amendment No. 132A is an attempt to formalise the content of the applicant's dealings with the tenants during a preliminary
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contest. This is something best left to the parties themselves. The potential applicant's interest will be to give a clear and persuasive picture of his suitability. The tenants will want to be sure that he tells them who he is, what his policies are and how they are expressed in his current operations and his track record. The Housing Corporation will, of course, be holding the ring and will be able to see that the potential applicant gives a full and honest picture and that the tenants have any advice they need to ask the right kind of questions. Tenants will have a further assurance that any applicant making a formal application in due course must meet the Housing Corporation's approval criteria. These, as the Housing Corporation's consultations on the matter have already shown, will demand evidence of long-term commitment, responsibility towards local housing needs and the other elements of our tenants' guarantee as well as evidence of sound financial and professional viability and competence.
Amendment No. 132B would place on the face of the Bill specific descriptions of the tenants to be consulted during the informal pre-selection procedures. As I have explained, we have no intention of formalising in legislation the Housing Corporation's procedures. We believe that it is best placed to devise its own. I am sure it will prepare flexible and workable guidelines and arrangements for all potential applicants and set up adequate arrangements for interested tenants to indicate their feelings, one way or another, about particular applicants and their ideas for the tenants' choice scheme.
I repeat—it was a point that the noble Lord, Lord McIntosh, raised but did not dwell on—that this is an informal and preliminary stage in what might become a tenants' choice scheme. We believe therefore that the more flexible and responsive it can be the better it will be for the tenants.
I now deal with Amendment No. 132D, which we believe is unnecessary. Local authorities already have the power to disseminate publicity about their services, either generally or to those people particularly affected by them. That power is regulated by the Local Government Act 1986 and the code of practice. But it is perfectly possible for an authority to make its case to its tenants within the reasonable statutory limitations that will apply. As my honourable friend the then Minister promised in another place we shall discuss with the local authority associations reasonable principles, as agreed in some of the new town disposals, to govern voluntarily the kind of information put out to either side. I would hope that that covers not only the pre-selection period but, more importantly, the formal consultations under Clause 101.
I hope that the noble Lord will be reassured on that front. I believe it is important to have discussions with the local authority associations and that is what we shall be doing.
Lord McIntosh of Haringey: I am grateful to the Minister for that reply. I am particularly interested in the suggestion of a new hurdle of the 10 per cent. of secure tenants giving their agreement before we can

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start the pre-selection procedure. I do not believe that the Minister has answered the points I was making in some of the amendments about the details to be provided by applicants. Perhaps I did not make enough of them in my speech to enable him to respond. If we return to the notorious Mr. Hoogstraten, it would be thoroughly undesirable if a pre-selection procedure—however informal and designed to be helpful rather than an obstruction—could go ahead without the proper inquiries being made into the financial links and the business interests of an applicant. The whole pre-selection procedure might turn out to be useless when real inquiries were made at a later stage.
The Minister has made some helpful comments about the degree of information which will be made available to local authority tenants. I shall have to read his comments carefully, but they may be helpful concerning the powers of the local authority (notwithstanding the Local Government Act 1988) to put its case fairly. I would rather read those comments and think about them before the next stage rather than press this matter to a vote now. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 132 to 132B not moved.]
9 p.m.
The Earl of Caithness The Earl of Caithness moved Amendment No. 132C:
Page 72, line 5, at end insert—
("(2) Where an application claiming to exercise the right conferred by this Part specifies, as a building proposed to be acquired by virtue of section 92(1)(a) above, a building containing a dwelling-house which is subject to an approved co-operative management agreement, the application—

(a) shall specify all the buildings which contain dwelling-houses subject to the agreement and in which the public sector landlord has the fee simple estate; and

(b) shall not specify (by virtue of paragraph (a) or paragraph (b) of subsection (1) of section 92 above) any building which contains dwelling-houses if none of them is subject to the agreement.

(3) For the purposes of subsection (2) above, an approved cooperative management agreement is an agreement—

(a) which is made with the approval of the Secretary of State under section 27 of the Housing Act 1985, either as originally enacted or as substituted by section 10 of the Housing and Planning Act 1986; and

(b) under which the body exercising functions of the local housing authority is a society, company or body of trustees approved by the Secretary of State for the purposes of subsection (2) above.").

The noble Earl said: In moving the amendment I speak at the same time to Amendments Nos. 132H and 132K. These amendments are the result of an assurance given by my honourable friend the Parliamentary Under-Secretary of State in another place when a similar amendment was tabled which was defective in detail. I understand that that was inspired by the National Federation of Housing Cooperatives and we have been pleased to go as far as we can to meet its aims. We feel that it is only sensible to allow tenants who have combined to manage their homes in a formally approved co-op the opportunity to decide as a group the future ownership of their homes.
Amendment No. 132C proposes a new subsection (2) to ensure that where an applicant includes in his application a building which contains a dwelling house subject to an approved tenants' co-operative management agreement, he must apply for all other such buildings which contain dwelling houses subject to that agreement but he must leave out buildings which have no dwelling houses subject to the agreement.
The proposed subsection (3) tackles the difficult legal question: what is a tenants' management cooperative? There is no unambiguous legal answer. Our approach is two fold: to confine the definition to bodies covered by formal agreements under Section 27, as amended, of the Housing Act 1985; and within those to empower the Secretary of State to designate those bodies which are co-ops for the purposes only of tenants' choice.
Amendments Nos. 132H and 132K follow this approach through to cover what happens when the landlord serves his notice under Clause 97 with counter-proposals about the property to be included in the acquisition. Again we wish to ensure that, as far as may be achieved, all of, and only, the freehold dwelling houses covered by the co-op, plus associated non-residential land and buildings, are in the acquisition. I beg to move.
Lord Graham of Edmonton: I thank the Minister for giving effect to the assurances given by his then ministerial colleague in another place, the honourable Marion Roe, when the issue of tenant management co-operatives was raised by my honourable friend George Howarth. What he has done so far has eminently satisfied.
However, can the Minister say a little more about the amendment? We have excluded from the possible transfer of ownership to a new landlord housing which is the basis of an arrangement between a council and an approved co-operative management group. The Minister will be aware that there are ongoing situations where many groups are in the process of making those arrangements but they are not yet finalised. Will the Minister say a little more about the groups which are not only thinking about the matter but have entered into negotiations with their council and cannot honestly say they ought to be excluded under the new Clause 95(2) because they have an agreement?
I am grateful that the concept of a co-operative management agreement is accepted as one which the Minister wishes to see preserved. A group of people have taken trouble and worked hard to create the kind of management nexus with which I am glad to hear the Minister agrees, as do we. However, at present negotiations are also taking place which cannot be concluded overnight but must take months. A number of people will not be covered by the new amendment but may be covered subsequently.
Can the Minister tell the Committee that he will be open to consideration of a further amendment which will take account of people who are at present genuinely and seriously discussing with their council

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the creation of a co-operative management agreement which is not yet complete? If the Minister says something which is kind the debate will end quickly. If he has sympathy but is not in a position to say more I shall wish to see whether agreement can be reached by those oustide the Committee and the Minister's advisers before the next stage of the Bill. I beg to move the amendment. I beg to support the amendment.
The Earl of Caithness: I am grateful to the noble Lord for moving my amendment on my behalf! I am delighted, and I am sure that there is room on this Bench for him.
Lord Graham of Edmonton: I shall be there.
The Earl of Caithness: The noble Lord has raised an important point which we are considering. I sympathise with him, but we are running into severe problems as regards the question of statutory definition and we are looking at the matter from a legal point of view. I confirm that the corporation will be able to take account of such prospects when operating its approval power. However, at present I cannot give any guarantee that we shall be able to come up with a suitable definition to add to the amendment.
Lord Graham of Edmonton: I am grateful to the Minister and I understand the situation. However, without putting words into the Minister's mouth I should like to know whether, in the light of the time that we have until the next stage of the Bill, the National Federation of Housing Co-operatives can successfully discuss with his advisers a form of amendment to be put forward at the Report stage which will give effect to its concern. Will the Minister and his colleagues look at that without prejudice?
The Minister says that the Housing Corporation will be empowered to take the matter into account. Let us suppose that the transfer of, say, 400 houses is effected by the democratic procedures which we dispute but which take place, and that within that number there is a group of tenants in the process of negotiating with the council a form of co-operative management agreement which, if concluded, would have excluded the houses but which is an ongoing situation. Although that may be fine it is much better if in the Bill there is an amendment guaranteeing that current negotiations will be successfully incorporated into the purport of the amendment.
The Earl of Caithness: I shall be happy to discuss the matter between now and a later stage of the Bill to ascertain whether wording can be agreed. I point out the severe difficulties but I am quite prepared to try.
On Question, amendment agreed to.
[Amendment No. 132D not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 132E:
Page 72, line 6, leave out ("four") and insert ("ten").
The noble Lord said: In moving Amendment No. 132E, I should like to speak also to Amendments Nos. 132G, 132U and 137A.
The amendments are an attempt to bring some sort of realism into the timescale for the procedures which take place under this part of the Bill. I should like to say straight away that although there is talk about extended timescales for the local authorities, there is also talk about extended timescales for the applicants. Amendment No. 132E refers to the timescale during which the local authority has to provide information required by Clause 96. There is a specific statutory duty under Section 105 of the 1985 Housing Act, even if this statutory duty has not been repeated in this Bill, for a local authority to consult its tenants on these matters and to provide an adequate period for the consultation.
When one thinks that there are very often a large number of properties involved, it is clear that consulation cannot be completed within a period of four weeks even if it were the whole of this stage of the negotiation. We are suggesting that a period of 10 weeks is more appropriate.
Amendment No. 132G refers to Clause 97. It concerns the vexed issue of which tenants will be eligible for transfer and which tenants will not. It is not just a question of whether or not they want to transfer—and this is a continuing matter of debate in Committee—but it is also a question of eligibility. It involves questions of access to the property, whether there are rights of way and easements, for example, involved in the transfer. All of those are matters which in the private sector, with all the pressures of the market place behind them, we know to our own cost very often continue for weeks and even months. We do not think it is good enough to start before the date at which the landlord has issued information under Clause 96. There has to be a reasonable period.
Amendment No. 132U on the other hand seeks to help the applicants because the period of two weeks which is allowed for the applicants to scrutinise the notice and to specify the price—because we are now concerned in Clause 98 with the price—does not seem to us to be at all adequate. We are proposing a period of four weeks instead, just to enable the applicants to have a reasonable stab at assessing whether the price is fair.
It seems curious to us that in Clause 98 it is necessary to put down an amendment changing two weeks to four weeks when the Government in another place accepted an amendment to this effect in Clause 97. If it is valid for Clause 97, why is it not valid for Clause 98, and why should this amendment not be agreed to?
Finally, I should like to refer to Amendment No. 137A in Clause 102 which allows the landlord six weeks instead of two to scrutinise a notice to proceed. This again is something which cannot be and ought not to be carried out in excessive haste, particularly when there are going to be a large number of dwellings involved.
These are not wrecking amendments. They do not damage in any way the principle which is being proposed. They ensure that the transfer is properly considered and that there is no risk of even greater delays which would arise if it were necessary for any of the parties involved in these complex matters to protest against the procedures and to seek referral, for example, to the district auditor. In that way, not only would the timescale and the procedures become very much more confused, they would become very much more lengthy. We think that the timescales proposed here are a reasonable safeguard against excessive haste and against the risk of getting it wrong. I beg to move.
Lord Ross of Newport: I should like to speak in support of these amendments. While I have some sympathy with the Government's aim to make local authorities get on with the job and not hang around, nevertheless I think that we must be realistic. I am back in private practice as a chartered surveyor. All I can say is that at the moment it is difficult to get even an answer to a letter from local government in under about four weeks.
The real problem is total lack of staff morale. There are terrible staff shortages. The planning department cannot get new recruits. They are leaving in droves. Anybody who is any good at all is going into private practice. Part of this is the Government's own doing because they have created this period of terrible low morale in local government. Therefore it is not realistic to expect them to be able to give these answers so far as these amendments apply to local government within the timescale. I particularly wish to speak to Amendment No. 137A. Under Clause 102 there is a fair amount of information which the applicant supplies to local government. He must list the names of tenants, houses, flats and also the price payable. The local authority has to respond, if it is the local authority concerned, as the Bill states:
"Within two weeks of service of the notice … the landlord shall notify the applicant in writing of any matters stated in that notice which it does not accept".
It is automatically going to say no to the price to start because it does not have time to see whether or not the price is realistic. Therefore, that is bound to lead to protracted negotiations. I should have thought that if the Government put on a sensible time limit of perhaps six weeks then there would be some chance of making progress on those negotiations and for getting deals under way. That is what I believe they aim to do.
While I understand the pressure they want to put on authorities to get on with the job when negotiations have been entered into, they have to be realistic and at the same time recognise what is the current situation within local government throughout most of the United Kingdom.
The Earl of Caithness: I agree with the noble Lord, Lord Ross of Newport, that we should all like to see the tenants' choice procedures, although extensive and potentially time consuming, proceed apace. Of course it is regrettable that some councils are perhaps
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in a position where they are not too likely to cooperate in the process. However, I do not believe that that is a reason to build in more delays than the system warrants. I confess that in the Bill as published we were perhaps a little optimistic in one or two of the proposed time limits. The Committee should be aware that in another place on a couple of occasions we agreed to increase the time limits.
Nothing that Members of the Committee have said today has convinced me that a landlord needs 10 weeks to produce just a list of names, addresses and tenancy types for the applicant. That should be an entirely reasonable task for any efficient local authority and it should take no more than four weeks. If there are real difficulties in meeting that, or any other deadline if they wish, the parties are free to negotiate an extension under Clause 109. That is my comment on Amendment No. 132E.
Amendment No. 132G follows from that. I must point out that if both amendments were accepted the landlord would have an incredible 22 weeks—very nearly half a year—in which to consider what changes he would like to make to the applicant's notice of property to be included. I cannot conceive that any landlord would need that long in which to carry out a simple assessment of the applicant's notice. I am surprised that the noble Lord, Lord Ross of Newport, supported that particular amendment because as a surveyor and valuer I should have thought that he would believe that 22 weeks was too long a period for that initial stage.
Turning to Amendment No. 137A, I believe that the proposal is excessive in its generosity to the landlord. He will already have discussed much of the detail of the applicant's notice of his intention to proceed at earlier stages of the tenants' choice process while the results of the ballot will give him a chance to reconsider what property the applicant is likely to claim. I take the point made by the noble Lord, Lord Ross of Newport, on that, and I should like to take that away to reconsider it without commitment if the noble Lord allows me to do so. I thought that there was a valid point at which I needed to have another look.
I am persuaded by the argument of the noble Lord, Lord McIntosh, on Amendment No. 132U. I believe that two weeks is too short and that four weeks is a more reasonable timescale. Therefore I shall be happy to accept that amendment when it is moved.
Before the noble Lord, Lord McIntosh of Haringey, says that I have been too unreasonable to him on this group of amendments, perhaps I can just remind Members of the Committee that under Clause 109 all time limits in the Bill may be extended by agreement between the parties. Therefore, it is right to set tight time limits and allow the flexibility because that will take care of the genuine difficulties without allowing either party to be obstructive.
Lord McIntosh of Haringey: I suppose that I should have known better. That will teach me to be even-handed and objective. I propose three amendments which attempt to give a reasonable timescale for a local authority to do the very complex

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tasks which are put before it, often concerning a large number of properties and a large number of tenants in different categories, and one amendment which helps the applicants. The Government accept that which helps the applicants and reject the three which help the local authorities, with, to be fair, the exception that the Minister said he would look again at Amendment No. 137A. I am not satisfied with his answers about the first two. I am grateful for what he says about Amendment No. 132U. I shall listen with some care to what he is able to come back with on Amendment No. 137A. It is only because of the time of night and the possibility of again raising the matter that I beg leave to withdraw Amendment No. 132E.
Amendment, by leave, withdrawn.
The Earl of Caithness The Earl of Caithness moved Amendment No. 132F:
Page 72, line 29, at end insert—
("() In this section "document" has the same meaning as in Part I of the Civil Evidence Act 1968.").
The noble Earl said: This amendment makes a small but necessary change to the provision in Clause 96 giving the applicant a right to inspect from four weeks after the relevant date documents in the landlord's possession which are reasonably required for the purpose of pursuing the application. The amendment clarifies the meaning of the word "document" in Clause 96.
It was always our intention that "document" in this clause should include information which, although stored on a computer in electronic form, could be printed out in documentary form. This amendment removes any doubt on the point by importing into the clause the definition of "document" in Part I of the Civil Evidence Act.
I am sure the Committee will agree that this is a minor technical point and I ask the Committee to approve the amendment. I beg to move.
On Question, amendment agreed to.
Clause 96, as amended, agreed to.
Clause 97 [Determination of property to be included]:
[Amendment No. 132G not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 132H:
Page 73, line 5, at end insert ("or that it is a building which is excluded from the acquisition by virtue of section 95(2)(b) above").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 132J:
Page 73, line 14, at end insert—
("() Where a notice under subsection (1) above specifies property falling within paragraph (d) of that subsection, the applicant shall have a right of access, at any reasonable time and on giving reasonable notice, to any of that property which is not subject to a tenancy.").
The noble Earl said: Clause 96(2)(a) gives the applicant a right of access to untenanted property "proposed to be acquired"; that is, included in the original application. This right of access is effective
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from four weeks after the relevant date. There is no comparable right of access to property added to the landlord's notice under Clause 97(1)(d).
Although in most cases the landlord, having proposed the inclusion of the property, is likely to co-operate in giving access to it, there is undoubtedly a loophole here and we do not wish to give an obstructive landlord the opportunity to exploit it.
This problem does not arise in the remainder of Clause 96(2) relating to access to documents since that is more broadly drafted, defining the access as to that required to pursue the application. I beg to move.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 132K:
Page 73, line 14, at end insert—
("(1A) A building which is excluded from an acquisition by virtue of section 94 or section 95(2)(b) above may not be included by virtue of subsection (1)(d) above").
On Question, amendment agreed to.
Clause 97, as amended, agreed to.
Clause 98 [Determination of purchase price]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 132L:
Page 73, line 45, leave out ("relevant date") and insert ("date of valuation subject to a revision of such calculation if completion is delayed by more than twelve weeks and such delay is not the result of a failure on the landlord's part to meet deadlines prescribed in this Part of this Act").
The noble Lord said: This amendment has the remarkable intention of saying that the valuation date shall be the date on which the valuation takes place. Those who are familiar with Marx Brothers contracts may think this is unnecessary, but in point of fact the Bill as drafted says that the valuation should be referred back to the original application date.
In the presence of so many chartered surveyors I hesitate as a layman to intervene on such matters, but it seems that even if there is a temporary lull in house prices, with the onward and upward march of house prices in recent months, particularly in the South-East, a gap of perhaps four months between the original application date and the date on which the valuation takes place is too great. There could be significant differences. These ought not to be allowed and there ought not to be an artificial gap in which there could be a significant appreciation in value.
For example, if we had an annual increase in house prices of 18 per cent., which is by no means unusual, we could provide the applicant with an immediate discount of 6 per cent. on the value of the properties. That cannot be justified. It ought to be the most up-to-date valuation date possible, and this is what Amendment No. 132L provides. I beg to move.
The Earl of Caithness: Any valuation has to be by reference to a specific date. We have chosen the relevant date as the day on which the application is made. This follows the right to buy precedent set out in Sections 122 and 126 of the Housing Act 1985 by

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which the valuation is made as on the day the applicant serves his notice of intention to buy. It is also consistent with the other time-related procedures in Part IV.
I find that there is not enough support in the argument of the noble Lord to suggest that a different approach would be preferable. In particular, neither party should be given an interest in either speeding up or, perhaps more likely I fear, slowing down the acquisition procedures. As my honourable friend said in another place, valuation at the relevant date is a useful incentive to everyone involved to get on with dealing with the application as quickly as possible.
I now turn to the parts of the amendment dealing with delays in the completion. Once the price is agreed and the ballot completed and the landlord has accepted the notice served under Clause 192, there is every reason for completion to proceed quickly. Both parties are under a duty to complete as soon as possible. The local authority will have the added incentive of this valuation point while the applicants' and the tenants' wishes for a transfer will mean that they will be keen to get on with the transaction, to get it over with and to continue with the management job.
I do not believe that the noble Lord, Lord McIntosh, has on this occasion presented a sufficiently cogent argument to make me change my mind on this amendment.
Lord McIntosh of Haringey: The Minister will not be surprised to hear that I am not very satisfied with that reply. He thinks that there are unmixed motives on the part of both the applicant and the local authority when it comes to questions of delaying or speeding up the process. It is certainly true that applicants, once they have made an application, in one sense will wish to see it carried through swiftly. In another sense, once they are protected by having the valuation made on the date upon which they made the application, if they delay the procedures they are also delaying the time in which they pay the money without any risk of paying more money because property prices will have gone up in the intervening period.
Therefore it is not by any means clear that it is in the interests of the applicants to speed up the process. It may well be that the effect of setting this earlier date for the valuation will be to delay the process and thus frustrate the intention of the Government rather than the reverse. I am no more convinced by the cogency of the arguments of the noble Earl than he is convinced by the cogency of mine. I believe that at this time of night we shall have to agree to differ on this matter at this stage of the Committee's proceedings. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Dean of Beswick Lord Dean of Beswick moved Amendment No. 132M:
Page 73, line 47, leave out ("on the following assumptions") and insert ("with the addition of a sum equal to thirty five per cent. of the value of any arrears of rent owing by the tenant of that property, and
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the following assumptions shall apply to the assessment of open market value").
The noble Lord said: In moving this amendment I understand that it is for the convenience of the Committee that it is also considering Amendments Nos. 138 and 140. This amendment allows existing landlords to recover arrears owing to them by adding the value of the arrears to the purchase price. If he wishes, the new landlord will be able to load the rent for the property in order to allow him to recover from the tenant the amount that he has overpaid for the property.
During the Committee stage the Minister stated that it was not his intention to leave a loophole whereby tenants could use the tenants' choice scheme to protect them from the consequences of accumulating rent arrears. I am referring to the Official Report of the Committee on the 28th, at col. 1168. This amendment provides a reasonable way of achieving this. It does not deny tenants the right to transfer unless they are exempted by virtue of a court order.
At the same time, it allows the former landlord to recover the debt. Unless there is such a provision in the legislation former landlords will have to rely on civil remedies to pursue the debt. Without the santion of eviction those remedies, are weak. The former landlord would first have to go to court and obtain judgment. If the tenant still does not pay the debt, the former landlord (the plaintiff) can take a number of steps to enforce that judgment. However, those steps suffer from a number of serious drawbacks. That process could he delayed in numerous ways by court action and that would help no one. I do not propose to quote examples at this time of night because I am sure that the Committee is aware of them.
Perhaps the Minister will confirm that a local authority will still be required to balance its revenue account. However, that does not take account of the fact that it will accrue debts through rent arrears for which it cannot be held responsible. If the amendment is not accepted and the Bill proceeds as it is, tenants who are not subjected to change may have to meet some of the outstanding deficits. I should like to hear what the Minister has to say about this matter. It is a complex subject. The intention of the amendment is to protect local authorities in respect of outstanding debts when a transfer takes place. I beg to move.
9.30 p.m.
The Earl of Caithness: The noble Lord, Lord Dean of Beswick, said that we were also discussing Amendments Nos. 138 and 140 which are in my name. It may be easier for the Committee if I were to explain those amendments and then return to Amendment No. 132.
Amendments Nos. 138 and 140 fulfil a commitment given in another place by my honourable friend, my predecessor as Minister for Housing. He said that arrears of rent outstanding at transfer should remain as a civil debt with the existing landlord under whose management they arose. We consider that the new landlord should not bear the burden of any mismanagement on the part of the

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existing landlord. Nor should the existing landlord be given any incentive to fail to collect rents and service charges due to him right up to the date of transfer.
The amendments ensure that my honourable friend's statement is fulfilled directly by a new subsection (4) in Clause 103. It disapplies Section 141 of the Law of Property Act 1925 lest that should transfer the arrears to the landlord with the reversion of any tenancy. It defines the sums concerned as arrears of rents and other sums (such as service charges) arising before transfer day under any tenancy, and it allows the public sector landlord alone to pursue the arrears after transfer.
Having heard what the noble Lord, Lord Dean of Beswick, has said, it will be clear that Amendment No. I 32M would cut across that approach. It purports to force the acquiring landlord to pay off over one third of the debts owed to the existing landlord, but it does not make provision as to which landlord would be entitled to pursue either part or all of the arrears and whether he could do so by way of a court order for possession.
The noble Lord was right when he said that the subject was complicated. The result of accepting Amendment No. 132M would be confusing, and, I repeat, incompatible with Amendments Nos. 138 and 140.
Lord Dean of Beswick: I am grateful to the Minister for his reply and although it was disappointing, I received the answer I expected. I do not honestly believe that the situation regarding municipal rent debts has even been looked at by the Government in the context of the Bill. As I pointed out during discussions on earlier amendments, some of the rent arrears—and it is not a question of the local authorities—are completely geographical because there are areas of great deprivation with enormous housing revenue account rent arrears.
I undersand from the report which appeared in the Manchester Evening News last week that in the 10 metropolitan districts which make up the greater Manchester Council there has been a substantial increase in such arrears across the board since the new housing benefit system came into being. I am not making any excuse about that but even before that time there was a substantial and enormous debt in some areas pro rata, per head of population. For example, in Manchester, I think I am correct in saying that rent arrears are just over £10 million at present. I vouchsafe to say that most of those arrears are accruing in certain global areas where there is great difficulty, where unemployment is high, or perhaps even the highest in Europe and where there is no possibility, whatever action the local authority takes, of recovering or collecting the money owed.
It may well be that the local authority could have had the situation a little more under control. Very often it is the approach of the local authority that can have a peripheral effect. I do not think that the situation in Liverpool is that much different and the situation is not that much different in some of the
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inner-London boroughs, although my noble friend and colleague Lord Graham of Edmonton would know more about that than I.
We all have the right to go to law, but the law in any form these days is very slow in dealing with housing repossession cases, although I am not criticising the law itself or the way it works and the facilities and finance that the Lord Chancellor allows. Indeed, repossession does not matter in such cases; it is the money that we are talking about. How does one get the money from someone who lives in an area where well over 50 per cent. of the people are either on maximum government benefit or are receiving a large proportion of such benefit?
If the Government are proceeding on the basis of transferring property thinking that the local authority could set up a system of thumb screws and racks that will bring the money in, when even court orders will not bring it in, they are whistling completely in the dark. When you say the local authority, you are not talking about the councillors in the town hall; it does not matter to them.
Some may be council house tenants; but most of them will not. We are talking once again about the person who is lucky enough to be in work but is unlucky enough to be just above the level where he can claim some form of housing assistance under the government scheme. Those are the people who will be called upon once again to fund whatever is necessary in the interim period before the court acts, because the matter must be kept afloat.
As I said earlier, it is a most complex business. I do not see any prospect of success in what the Government are trying to do regarding the recovery of arrears on the transfer of property, even with a realistic approach to the situation. I say that having been a chairman of one of the largest housing authorities in the country and knowing of the difficulties with which they have to grapple-although it may well be that more efforts may have been made to reduce the figure. However, to talk in terms of reducing them substantially is unrealistic.
The problem exists pretty well across the board in the Manchester area. I am talking about areas on the periphery of the City of Manchester that are now showing the same trend of rent arrears accelerating whatever the local authority does. Therefore if the Government proceed on the basis of discounting that happening, I say to them that it is not a phenomenon which will go away; it is with us and will stay with us because most of the people who are accruing these arrears are not the kind of people that the Chancellor of the Exchequer keeps talking about as having done well. They are not doing well, and the work is not returning to those areas. In the areas about which I am talking there is 50 per cent. male unemployment, and there will still be 50 per cent. male unemployment in two years from now. I should like the Minister to agree that the Government will look at it again. If they proceed on this basis, they are completely backing the wrong horse and will not achieve their objective.
The Deputy Chairman of Committees (Lord Renton): Does the noble Lord seek to withdraw the amendment?
Lord Dean of Beswick: Obviously I am disappointed in the reply, although I received the
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reply I was expecting. I would seek leave to withdraw the amendment. We may want to come back to this matter and talk about it at later stages of the Bill. I do not think enough thought has been given to it so far—quite unintentionally. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendments Nos. 132N to 132S:
Page 74, line 5, after ("approved") insert ("or that a reasonable number of bidders was likely to be approved").
Page 74, line 6, leave out out paragraph (d).
Page 74, line 9, leave out ("and").
Page 74, line 11, at end insert—
("(f) that the price payable must not be less than the debt outstanding on the dwelling at that time.").
Page 74, line 11, at end insert—
("(f) that the applicant will be able to create tenancies under the terms of Chapters 1 and 2 of Part I of this Act.").
The noble Lord said: I beg to move Amendment No. 132N and those amendments up to and including Amendment No. 132S. Although the amendments arc detailed, the Minister and his advisers will understand that the purpose of the amendments is to get some clarification from the Government as to how serious they are about value for money in the sale of public assets to the prospective new tenants' choice landlord. The amendments are designed to make sure (a) that there is some competition, and (b) that there are some means whereby the income to the authority on the sale and transfer of those public assets can be sustained.
The Minister is well aware that in my view some authorities have acted quite disgracefully and irresponsibly. In the document Public Problems and Private Solutions which was published in May 1988 it was said that the Conservative controlled Sefton Borough Council disposed of the Waverley Park Estate for £20,000 leaving over £377,000 loan debt outstanding against the council and a yearly rental loss of over £80,000.I am sure the Minister's brief will indicate a rebuttal of that or a condemnation of it. I very much hope that it is the latter. In the same document published by his department we are drawn to look at the experience of Trafford Metropolitan Borough Council, again at the time Conservative controlled but now hung. That report details losses incurred by the authority in disposing of the property Beazer Homes, and the additional costs that will fall on existing tenants.
I am well aware that a number of years ago the right honourable Peter Walker MP said that the solution was to give council houses away. Not only are we finding that council houses are being given away but in actual fact there is a contingent cost of liability which is left for the council, and in most cases the council tenants, by virtue of the way in which the sales are conducted. In other words, the remaining council tenants are having to pick up some of the tab for having lost some of their neighbours because of the manner in which the council dealt with it.
I have a number of questions which I should like to put to the Minister. For instance, does the Minister favour tenants subsidising the profit margin of private sector landlords, because that would be the effect of what I have said is the situation? Does he favour tenants receiving inferior service? Does he favour ratepayers subsidising the profit margins of private sector landlords, or ratepayers obtaining an inferior service in areas wholly unrelated to housing?
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Would he like the taxpayer to subsidise the profit margin of the private sector landlords?
It is important for the public—that is, the great public out there—who want clarification and clarity in these matters to know not only that it is a grand idea that tenants can choose but that when they do choose according to the manner in which the Bill is framed and there is a payment or detriment suffered, it is not the taxpayers who suffer. Frankly, it is bad enough if it is the remaining council tenants. So I think that the Minister has an obligation to the Committee to let us have the benefit of his thinking on this matter. I beg to move.
9.45 p.m.
The Earl of Caithness: In designing tenants' choice, we have made it clear from an early stage that transactions should take place at market value subject to tenancy. That, we believe, is the only appropriate basis for sales without subsidy to independent landlords subject to commercial pressures and considerations. Clause 98 is put together on that basis.
We appreciate that that represents a considerable departure from previous disposals of tenanted public sector housing. But those have normally involved a disposal by one public landlord to another. Accordingly, market influences have given way in the valuation to such considerations as the amount and future funding of the selling landlord's accumulated loan debt.
Clause 98 instructs the valuer to look at other matters. He must contemplate a market in which all approved landlords notionally might bid against each other for the property. This has two effects. First, it prevents one applicant who is in fact pursuing the acquisition from effectively naming his own price. Secondly, it allows for the fact that approved landlords will, in accordance with the tenants' guarantee, make a commitment to social objectives which they will have to balance against commercial pressures in deciding upon rents, levels of service to tenants, and so on.
Amendment No. 132N clearly attempts to enter into the spirit of our approach and I am grateful to the noble Lord, Lord Graham of Edmonton, for trying to do so. To the extent that it attempts to open the notional market to a full range of approved landlords under all circumstances, we are content with the underlying intention. However, I am not convinced that, as drafted, it either achieves its point or is a necessary adjustment to the existing wording. I should be grateful if the noble Lord would let me take that point away for further consideration. Doubtless we shall come back to it if necessary.
However, Amendment No. 132P is different and therefore unacceptable. Paragraph (d) instructs the valuer to allow for the reasonable costs of making good any backlog of landlords' repairs outstanding under its statutory contractual obligations. It must be right that where a landlord has fallen short of its legal obligations, it, not the acquiring landlord, should be

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penalised by the valuation process. Without such a provision, including its potential to give rise to negative valuations, many approved landlords would not buy rundown property under tenants' choice, thereby depriving tenants in the worst council housing of their effective choice of landlords.
I have said why the tenants' choice valuation must be market-based and why it is a departure from former public sector practice. It would go against those arguments and prevent tenants' choice sales from going ahead if, as proposed by amendment No. 132R, there were a minimum price set equal to outstanding loan debt. However, we have recognised a potential problem for landlords who receive less from a sale than the debt outstanding on the property. The normal workings of the housing subsidy system will continue where transfers take place from local authorities under the tenants' choice provision of the Bill. The local authority's financial position following such transfers should in general be covered by the normal arrangements.
However, when transfer terms were discussed in Committee in another place we recognised that the housing subsidy rules were not designed with large-scale disposals in mind and may not always produce a sensible result. We therefore undertook to conduct a review of the housing subsidy rules to ensure that they operate sensibly where stock is disposed in substantial quantities to a new landlord as under the tenants' choice provisions of the Bill.
I can tell the noble Lord, Lord Graham of Edmonton, that we have yet to reach a final conclusion on the review but our aim is to devise a scheme which is equitable between both local authorities and central government. In principle, I foresee a measure of subsidy continuing for those local authorities that have continuing loan charges after the disposal of stock. By the same token, however, it may be that where an authority's net costs are reduced through disposal, its subsidy element should also reduce. I hope shortly to announce the conclusions of our review of the subsidy system and consult the local authority associations on whatever changes we propose.
Far from not giving this matter serious thought, I hope I have convinced the Member of the Committee opposite that this matter has been seriously thought through. Finally, Amendment No. 132S does not appear to us to be needed. It follows from the provisions of Clause 93 that approved landlords, as already mentioned in Clause 98(2)(c), will indeed grant assured tenancies under Part I of the Bill.
Lord Graham of Edmonton: I appreciate the care that the Minister has shown in this matter. However, there are still a number of points on which I should like clarification. The Minister has told us that there is a review on the whole vexed question of how a council which finds its properties transferred is left in the light of its existing debt burden and other matters. I want to be sure that the Minister has taken on board not only my concern about the effect upon the tenants but also that upon the council. If I can be assured of
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that, I am prepared to rest my case. However, I should be grateful if the Minister could say a few more words as regards the ability of a prospective new landlord to achieve better than what I would call value for money. The recent independent auditor's report on Stockbridge village stated:
"The Department of the Environment's personal view is that the cost of buying tenanted estates should be consistent with the purchaser's ability to pay."
That is an astounding way of disposing of public assets. It is astounding that the price one charges is what one perceives as the ability—not the market value, the future value or anything else—of the purchaser to pay. In other words, one is asking oneself what is the best price that a purchaser can afford that is consistent with his ability to pay and not with one's assessment of the thing that one is selling.
The Minister is also aware that at Thamesmead the transfer price was only 10 per cent. of the market valuation. The valuations and circumstances in Thamesmead could very well be different to those in other places, of course. I do not intend to pursue the matter, but I want to lay down a marker to the Minister that we shall want more information from his department. Those outside the Chamber who guide us in these matters will certainly seek more. The Minister's intentions are reasonable. They are that no one should be seen to be taken for a ride and that no one should be seen to be making a meal out of this matter. But, in our view, the Bill enables the Government to give something for nothing or next to nothing to some people who might be construed as the Government's friends. The Government may be viewed as giving something away by virtue of an arrangement. We do not want that. We are certainly not in favour of someone making a killing out of becoming the tenants' choice of new landlord. With those caveats, and although I am grateful for what the Minister has said, we shall certainly return to this matter.
The Earl of Caithness: I am grateful to the noble Lord for giving way. I wish to stress what I said right at the beginning. We are not talking about the ability to pay of a potential applicant; we are talking about market value subject to tenancy. I hope that that will prevent the situation that the Member opposite has explained so clearly of one side getting a special benefit. We wish to avoid that situation.
Lord Graham of Edmonton: I am grateful for the Minister's comments. We shall need to look further at what he has said. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 132P to 132T not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 132U:
Page 74, line 27, leave out ("two") and insert ("four").
On Question, amendment agreed to.
Clause 98, as amended, agreed to.
Clause 99 [Tenants continuing as tenants of landlord]:
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 132V:
Page 74, line 34, leave out ("may") and insert ("shall").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 132W:
Page 74, line 38, leave out ("or by a tenant of any prescribed description").
The noble Earl said: In moving Amendment No. 132W, I should like also to speak to Amendments Nos. 132X, 132Z, 132ZA, 132ZB, 132ZD, 135C, 135F, 135H, 136E and 137B. This group of amendments deals with some important aspects of the process by which tenants' votes determine collectively whether the application can go ahead and individually whether their tenancies are to transfer the applicant, to be excluded from the acquisition altogether in the cases of houses, or be leased back to their existing landlords in the case of flats in blocks which transfer.
The point of the amendments is, first, to ensure that the test which decides whether an application can go ahead—the test in Clause 102(2) whether 50 per cent. of tenants consulted have expressed a wish to stay with the landlord—is correctly calculated; and, secondly, to ensure that, following a "yes" vote the position regarding property to be leased back can be duly followed through in Clause 99.
On the first point, every vote cast must clearly influence the collective decision. As the Bill stands, we are not satisfied that that would be the case.
If we look at Clause 102(2), we see that the test is that an application can go ahead unless more than 50 per cent. of the tenants to whom Clause 101 applies give notice under Clause 99(2) that they wish to continue as tenants of the landlord. The result of this is inappropriate in relation to long leaseholders—people who have bought their flats. They are entitled to consultation under Clause 101. They therefore increase the figure which forms the denominator of the fraction by which the majority test in Clause 102 is assessed. But the numerator of the fraction, as we have seen, is defined by reference to Clause 99(2), which indentifies categories of tenants who are to be leased back or excluded as a result of their vote. Long leaseholders do not figure here, and it would not be appropriate for them to do so. Because it is the freeholder who has the structural and other responsibilities dealt with in the leaseholders' leases, it is a practical necessity for them to hold in all cases from the new freeholder if the transaction goes ahead, even if they would have preferred personally to keep the old freeholder. Their absence from Clause 99(2), however, means that their vote cannot, as the Bill is drafted, affect the numerator of the fraction by means of which the majority is assessed in Clause 102. This distorts the picture unfairly in favour of transfer, and is not what we want.
Amendments 136E and 137B remove from Clause 102(2) the cross-reference to Clause 99(2) which
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causes the anomaly I have described, and clarify the link with consultation under Clause 101.
The remainder of Amendments Nos. 132W to 135H put the Secretary of State's powers, subject to negative resolution procedure, to prescribe descriptions of tenants for consultation under Clause 101 and lease-back under Clause 99 into a form which allows the links between the two processes to be more completely and satisfactorily followed through. Perhaps at this stage I should move the amendment. However, I can go into more detail if the Committee wishes.
I can summarise by saying that as at present drafted the Bill through a complicated technical process is in favour of transfer. We are trying to redress the imbalance that we have spotted so that the long leaseholder's position is truly reflected. I beg to move.
Lord McIntosh of Haringey: Our virtual silence on this matter should not be taken to imply any agreement with the framework in which these amendments are moved. We are strongly opposed to the voting procedures, as we made clear earlier this afternoon and as we shall have to make clear again. However, when it comes to righting injustices for long leaseholders, this is not a matter that we would wish to oppose.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 132X:
Page 74, line 41, leave out ("so occupied") and insert ("occupied by a tenant to whom subsection (2) below applies or by a tenant of a description prescribed for the purpose of this paragraph").
On Question, amendment agreed to.
10 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 132Y:
Page 74, line 43, at end insert ("; and
(c) that any lease granted under subsection (b) above shall be on the terms prescribed and that such terms shall include—

(i) the applicant's obligations to the landlord;

(ii) the applicant's obligations to the landlord's tenants;

(iii) the rent payable;

(iv) the arrangements for rent review;

(v) the service charges payable;

(vi) the arrangements for service charge review;

(vii) the consultation rights between the landlord and the applicant;

(viii) arrangements regarding the maintenance and management of communal areas;

(ix) arrangements regarding any future disposals by the applicant;

(x) the redemption value of the lease payable to the landlord by the applicant at the end of the term;

(xi) arrangements for the resolution of management disputes between the landlord and the applicant and between their respective tenants.".

The noble Lord said: This amendment refers to paragraph (b) of Clause 99(1) which in turn is concerned with a dwellinghouse:
"which is a flat and is so occupied".
It has been the experience of those in housing management that there are a number of very

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complicated matters which ought to be spelt out and be entirely clear when we come to the leasing back of a flat, as in this case, from the applicant or the new landlord to the landlord or the local authority.
We are proposing to insert a new paragraph (c) which spells out all the issues—I shall not read out all of them—for example about service charges, maintenance and management of communal areas, and the resolution of disputes between the landlord and the applicant and their respective tenants. These are extremely complex matters. Even if the Government do not feel that the wording of this amendment is immaculate—and I certainly cannot guarantee that it is—I hope that they will recognise that it is simply not enough to state in subsection (1)(b):
"that a lease of any dwelling house which is a flat … shall be granted by the applicant to the landlord immediately after the acquisition".
That has to be spelt out in more detail if it is to be effective. I beg to move.
The Earl of Caithness: First, I agree with the noble Lord, Lord McIntosh, that the terms on which the homes of those who continue to be tenants of public sector landlords are leased back is a very important subject. My honourable friend the then Minister for Housing said in a Commons Committee that before exercising the right which my right honourable friend the Secretary of State has under Clause 103(2) to prescribe their terms, we would consult local authorities and others with an interest. It seems to me that that is a better way than the noble Lord's prescriptive list of subject areas for leases to ensure that legitimate interests are appropriately covered.
Having said that, I think it would be helpful to him if I were to give an indication of our thinking on the list that he has put before the Committee. Of the items listed, I remain unpersuaded by items (ii) and (xi). The first deals with the relationship between the applicant, who is a party to the lease, and the public sector landlord's continuing tenants who are not. The second purports to regulate means of settling disputes which may arise between the applicant's and the public sector landlord's tenants through the terms of a lease to which, of course, neither would be parties. This seems odd now, just as it did when the subject was debated in Committee in another place.
Items (i) and (viii), which deal with the general relationship between lessor and lessee and with arrangements for looking after common parts are, I would accept, part of any lease of the kind envisaged here, and our proposals for regulations under Clause 103 will take appropriate account of them. As for rents, service charges and arrangements for reviewing both—matters covered by items (iii)-(vi) in the noble Lord's amendment—we propose that the public sector landlord will pay to the applicant the same rents and charges which transferring tenants have themselves agreed in the course of consultation under Clause 101 to pay. The arrangements for review which would apply would be those which had been agreed between applicant and transferring tenants in the same way as would be the public sector landlord's right to be consulted on the applicant's proposals for the building—item (vii) in the noble Lord's list.
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On his item (x) we propose that no redemption value would be payable on termination of leases-back. This arrangement is the corollary of our proposal that no premium should be payable by the public sector landlord to the applicant when the lease is granted on transfer.
We still have to consult with the local authorities and others with an interest. We shall be doing that in the near future. I hope that I have been able to explain to the noble Lord some of our thinking on this matter.
Lord McIntosh of Haringey: I am not unhappy that I moved this amendment because it has evoked such a considered, thoughtful and courteous reply from the Minister. I have to conclude that it is good in part rather than good as a whole but there is certainly ample food for thought about the different elements which he discussed. I shall wish to consider them before a later stage of the Bill. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Caithness The Earl of Caithness moved Amendments Nos. 132Z to 132ZB:
Page 74, line 44, after ("applies") insert ("(a)").
Page 74, line 45, after ("and") insert—
("(b) to any tenant of a description prescribed for the purposes of this subsection,
being, in either case, a tenant").
Page 74, line 46, after ("below") insert ("and in response to the consultation under that section").
On Question, amendments agreed to.
Lord Ross of Newport Lord Ross of Newport moved Amendment No. 132ZC:
Page 74, line 46, leave out from ("below,") to end of line 47 and insert ("does not give notice in such manner as may be prescribed of his wish to become a tenant of the applicant.").
The noble Lord said: At the outset perhaps I may apologise for the absence of the noble Lord, Lord Alport, who sent me a message this afternoon that he is unfortunately indisposed. He has influenza and cannot be here to support this amendment.
The amendment is similar to the first amendment that we discussed this afternoon. For some reason or other better known to themselves, the Government brought in their big battalions and managed to make sure that it was heavily defeated. On reflection I wonder whether they will live to rue that decision because I do not believe that the Government have got this right. I shall not delay the Committee in putting forward the same arguments moved earlier today. I merely suggest that Amendment No. 132ZC to which the noble Lord, Lord Alport, has put his name, and Amendment No. 136C in my name, offer an alternative to the Government.
In his winding up speech, the Minister said that he was prepared to consider some concessions. He talked about the size of the turnout. I wish to press him on that. He must come up with something slightly better. His predecessor, the former Housing Minister, described the voting provisions as inelegant drafting and admitted that they had generated

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hostility towards the Bill. Having listened to the discussion on the last amendment about the leaseback of flats and the general agreements about management, service costs, and God knows what else, the Government have a real problem on their hands. Those Members of this Chamber who, like me, are tenants of privately owned blocks of flats will know some of the problems experienced in trying to get service charges, decoration, and all the rest of it agreed. If applicants who take over estates, lease back the fiats, and then have to argue between themselves—the landlords and tenants—to try to sort out these matters. it will be some task. I think the noble Earl is aware of that. These are matters for a great deal of debate and dispute.
Having said that, the present way in which the voting takes place can ensure that eligible voters who do not vote are not transferred to a new landlord. By equating them with a no vote, the inertia selling characteristics of the voting procedures are removed. Equating non-votes with abstentions is unworkable. A relative majority supporting the transfer, in the event of a low turnout, could mean that the whole estate transfers and yet the majority of tenants (the non-voters, combined with the "no" voters) could in fact at the end of the day stay with the council through this complex leaseback procedure.
It really is a bag of worms. I press the Minister to look at the amendments I have tabled which come from the NCC, because they provide a sounder basis for protecting the interests of consumers and provide an appropriate motivation for effective publicity and tenant consultation and a sound basis for good management of landlord and tenant relations. They would remove an unnecessarily provocative element within the Bill which is generating confusion and hostility to tenants' choice. A tenant stays a tenant of the council if he does not give notice of his desire to change. That is roughly a summing-up of the amendments.
I do not believe that it would be right to divide the Committee again on this issue tonight, but I beg the Minister to consider this whole subject again and see whether he could not do better than the proposition that the question of turnout should be paramount. We need more than that and I hope that he will consider the amendments I have tabled to the Bill. I beg to move.
The Deputy Chairman of Committees: If this amendment is agreed to I cannot call Amendment No. 132ZD.
Lord McIntosh of Haringey: I should like to echo the words of the noble Lord, Lord Ross of Newport. Despite the very heavy vote which took place this afternoon, I feel that we shall find ourselves allowing through a nonsense. We shall find ourselves in a position where objective outside bodies such as the National Consumer Council can accuse the Government—although it is itself a government-funded organisation and is therefore somewhat restricted in its scope for direct criticism of the Government—of inertia selling. That is a very serious accusation. The NCC has proposed amendments
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which are not too different from the amendments I put forward earlier this afternoon to overcome the problem and to free the Government from that charge. The charge will still be here despite the majority which the Government achieved this afternoon.
There are other amendments on the Marshalled List, notably Amendments Nos. 135D and 135E, which attempt to provide alternatives to the Government's existing proposals and to consider alternatives to the modest concession which the Minister indicated in circumstances where there was a very low turnout in the ballot. I do not believe that it will be helpful to the Committee for us to debate them further this evening. I indicate my general support for the amendment moved by the noble Lord, Lord Ross of Newport. It may be helpful to the Government to know that I do not propose to move Amendments Nos. 135D and 135E, but I should like to discuss them further with the Minister before Report stage.
I very much hope that we can reach a conclusion on this matter which will satisfy the real concerns of outside bodies and leave the Government in a position where they can justifiably defend the democratic nature of the actions that they propose in the Bill.
The Earl of Caithness: I listened carefully to what both the noble Lords, Lord Ross of Newport and Lord McIntosh of Haringey, said. I too believe that it would be wrong and against the rules of debate for me to repeat what I said earlier in our general discussion on the voting procedure. Notwithstanding the decision of the Committee earlier this afternoon, I shall read with great care what both noble Lords said and I shall be happy to discuss it with them.
However, much as the noble Lord, Lord McIntosh of Haringey, will be keen to satisfy the real concerns of those outside, I am very keen to ensure that the cry from the tenants who say "Give us this choice; give us the opportunity to change our landlord" is also satisfied. I therefore note what both noble Lords said and I am willing to discuss it with them between now and another stage.
Lord Ross of Newport: I believe that that is a generous offer. I accept it in the spirit in which it is given. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
10.15 p.m.
The Earl of Caithness The Earl of Caithness moved Amendment No. 132ZD:
Page 74, line 46, leave out ("in such manner as may be prescribed") and insert ("as mentioned in section 102(2) below").
On Question, amendment agreed to.
Lord Dean of Beswick Lord Dean of Beswick moved Amendment No. 132ZE:
Page 74, line 31, at end insert—
("(5) Where the tenancy of a dwelling leased under subsection (1)(b) above comes to an end the landlord shall let the dwelling and the tenant shall subsequently have a right to choose whether to remain with the landlord or to have the dwelling transferred to the applicant.").
The noble Lord said: The amendment allows a new tenant moving into a vacated leased-back flat a choice of landlord. The justification is that if a leased-back flat becomes vacant this should not automatically terminate the lease because that invalidates the choice made by the original tenant. That tenant chose to stay with the public sector landlord, possibly for personal reasons or possibly because he wanted the public sector to retain control over the dwelling. That was his valid choice.
The new tenant who will occupy the dwelling should have an equal valid choice. If that is denied, the issue is not choice but instead public sector asset stripping. Moreover, where a house is exempted by choice of the tenant, subsequent tenants can choose. Are tenants of flats not to be allowed the same choice and become second-class citizens? I do not wish to speak at length on the matter in view of the time of night but I should like to hear the Minister's reply to the amendment before making further comment. I beg to move.
The Earl of Caithness: The effect of Amendment No. 132ZE would be to allow public sector landlords to re-let flats which had been leased back to them in transferred blocks as and when the tenancies of tenants who had opted to remain with the landlord came to an end. The public sector landlord's new tenant, supposedly, would then be given a choice between staying with that landlord or becoming the tenant of the former applicant, now the freeholder of the block.
Some categories of flats, for example those in categories excluded from the scope of the scheme—certain kinds of property suitable for and used for housing the elderly or disabled—will need to be leased back from landlords on a permanent basis. Leaving those aside, the essence of the arrangement that we propose under tenants' choice is that the lease-backs which public sector landlords are granted are of flats occupied by qualifying tenants who vote "No" in consultation and certain other tenants, for example, those holding short leases who will be prescribed tenants. Regulations will prescribe when the lease-backs will end.
We announced at an earlier stage, as Members will have seen from paragraph 36 of our June explanatory document, that the principle here is that once a decision has been taken that the block should transfer—a decision, of course, which is the applicant's unless a majority of tenants oppose transfer—the applicant must be able, over time, to consolidate his control and management of it. Leases-back of certain flats have been provided for in the Bill, not to give the public sector landlord any permanent, continuing control over the flats concerned but to respect the wishes of certain individual "No" voting tenants for the duration of their tenancies and to meet a limited range of other cases where for practical reasons transfer is for the time being not appropriate. We believe that it is right that such a flat, when it comes to be re-let, should be re-let by the applicant.
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Nor would the choice between landlord and applicant proposed in the amendment for the new tenant be a genuine one, I fear. Instead there would be an irresistible temptation for many public sector landlords, given the freedom to choose the next tenant, to make sure that they chose someone whom they could confidently expect to opt to remain with them.
We believe it is right that, where a tenant wishes to remain with a public sector landlord—the local authority—he should be entitled to do so but that that should he for the term of his tenancy only.
Lord Dean of Beswick: Does the Minister recall that just before the annual recess I had a question on the Order Paper concerning tenants in an area of the London dockland? I said words to the effect that I was not deeply concerned about the views of the council, which the Minister was quoting, but was more concerned with the question of the individual tenants. Had the tenants been asked—not the council or the local authority but the tenants? The Minister said he would remind me during the passage of this Bill that the tenant was the prime concern of the Government. I put that to him now.
In this case I think that the tenant has every right to the same consideration as the previous tenant; otherwise, in my opinion, he is being victimised or stigmatised. In other words, he is not being given equal opportunity. I do not believe that a local authority which is under pressure by people to occupy varieties of tenancies because of the shortage will be toothcombing and saying, "Do you want to stay with us or do you want to go with the other authority?" In my opinion there is no way that that exercise can get off the ground, or work in any event. I hope that the Minister will give a little more serious consideration to what I have been saying.
The only thing that one can conclude from what the Minister is saying is that wherever there is a possibility of making a decision on the side of the applicant, that was what the Government would want: they shall have priority and not the individual. I am pleading on behalf of the individual. I should have thought that the Minister would be a little more sympathetic.
Lord Campbell of Alloway: I do not understand how the criticism made of the Government that they failed to accord equal opportunities is made good by anything that the noble Lord has said. I fail to understand this criticism. It is, as I see it, wholly misplaced.
Lord Dean of Beswick: We are in politics because we dare to disagree with one another. Although I have a great deal of respect for the noble Lord, I think that he has just talked a load of poppycock. I am talking about the rights of individuals. I believe that Members of the Committee are, above anything, concerned with the rights of individuals. It matters not that a vote was taken earlier this evening with a substantial majority for the Government. That registers in here and it will become law, but that vote does not alter the fact that the overwhelming number

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of tenants in the local public sector want to remain so, wherever their views have been made clear. I defy the Government to prove anything different.
However, in certain respects they are going to be devalued and their individual desires dealt with rather severely by this Bill and restricted more than we would wish. As I said, although the vote earlier this evening, with a substantial government majority, will eventually convey that to the law, it will have trampled on individual tenants in this country. I am making a particular appeal in this amendment for the rights of certain individuals. I think that is logical and that it is right to make the case. However, although I am not going to get anywhere with this amendment, I hope that the Minister will look at it again. On that basis, I beg leave to withdraw the amendment.
The Earl of Caithness: Of course I will look at everything that has been said today. What has encouraged me in what the noble Lord, Lord Dean of Beswick, has said is what a potential success he believes tenants' choice is going to be. I am rather encouraged after hearing noble Lords opposite. We always believed that it would be a success. The terror that it has struck into the noble Lord of vast areas of council housing going over to alternative landlords really quite excites me.
Lord Dean of Beswick: I believe that we have been in two different debating Chambers. If the Minister cares to read Hansard tomorrow and believes that winning the vote was due to the Government winning the debate then he is in cloud-cuckoo-land because he did not make a valid case at all. On the basis of the argument, he came a very poor second; and had there been another runner in the race, I do not believe that he would have been in the place betting. He sits back because he has won a massive vote which was guaranteed and has no consequence outside of this Committee for people of fair thinking. The Government can keep doing that, but eventually a price will be paid for that type of vote taking place in this Committee. I believe that the Minister will have to do a lot better than he did (although he won that vote) to convince Members of the Committee on this side that there is any credence in government policy on this occasion.
The Earl of Caithness: I believe that at this hour of night the noble Lord misunderstands me. I said that I was encouraged by the concern that he had that tenants' choice was going to be the success for which we were hoping. As he knows, in England 67 per cent. of the housing stock is owned by owner-occupiers. Of the remainder, 8 per cent. is private sector and the vast majority—over 5 million—are council house tenants. There will be a substantial local authority influence on housing for many years to come. We are offering tenants' choice and a greater opportunity than they have had. The noble Lord spoke as though every single local authority flat and house is going to be taken by tenants' choice straight away.
Lord Dean of Beswick: Perhaps the Minister would care to reflect for one moment. He believes, as he said earlier, that this Bill will make a massive contribution towards solving the homeless problem and that type of problem—and that is really what we are talking about. Is he saying that the Government have doubled homelessness by their policies or by accident? Is he saying that by accident or by policy we have the smallest public sector building target since the war? Are all those accidents or government policy? If he classes those as successes, he is way off the mark. If the Government had been building at the rate at which the local authorities were in 1979 (when the Government took office) there would have been 500,000 more council house to let. Therefore, he would not be indulging in this exercise. The Minister is tending to widen the debate. I may be sorry that I responded, but there will be a lot more to say on this matter before this Bill has gone through all its stages.
Lord Campbell of Alloway: The noble Lord does less than justice because when we see a fair objection in principle to the Bill, we have given way and accepted Opposition amendments. Nothing that he has said contributes to any constructive criticism of the Bill. It is a political opposition and one understands and accepts that as a political opposition; but that does not mean to say that it is based on reason.
Lord Dean of Beswick: If the noble Lord, Lord Campbell of Alloway, says that we are opposing this because it is a political opposition, I should like to meet him in the morning and show him some of the petitions that have been sent to me by tenants of the authority of which I was the former chairman in Manchester. They have not been solicited but have been sent quite voluntarily. Those people are not interested in the politics of the matter. However, having said all that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 99 agreed to.
10.30 p.m.
Clause 100 [Tenancies granted after relevant date]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 133:
Page 75, line 32, leave out from beginning to ("applies") in line 39 and insert ("(I) This section").
The noble Earl said: In moving this amendment I speak also to Amendments Nos. 134 and 135. I fear that in doing so I shall touch also on Amendments Nos. 134A and 134B in the name of the noble Lord, Lord McIntosh of Haringey.
Clause 100 is designed to protect the interests of the applicant; for example, against a landlord who might try to "pack" empty flats after receiving an application for the blocks that contained them. But it is also intended to allow the landlord to make use of property which becomes empty after it has been proposed for acquisition. No tenancy or licence granted by the landlord to occupy such property shall be secure, or come within certain other statutory

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forms of protection, and the landlord has the power to determine any such tenancy regardless of its terms. However, we have been advised that some amendment is required in order to make the provisions watertight, as foreshadowed in our explanatory paper Tenants' Choice which was made available to your Lordships' House before Second Reading. Amendment No. 133 is purely a paving amendment, although it removes subsection (1). Amendment No. 134 makes clear that the powers of Clause 100 apply from the moment that a property is proposed for inclusion in an application. It precludes the argument that the clause does not apply until the outcome of an application is definitely known. Amendment No. 135 introduces subsections (2A), (3) and (4). They replace and supplement the original subsection (1). These subsections make clear not only that the landlord is obliged rather than simply empowered to determine the tenacies affected, but also that these tenancies shall be determinable by a four weeks' notice to quit regardless of their terms.
The proposed regulations will ensure that the landlord informs the applicant of any new lettings and explains the situation to any new tenants. They will require the landlord to render vacant possession to the applicant at the time of transfer and provide that where he does not do so for whatever reason, any resulting loss incurred by the applicant will be recoverable as a contract debt. The landlord will also be liable for the applicant's costs and expenses in recovering possession. Finally, the regulations will provide for the disapplication of the clause where an application is not completed.
Amendments Nos. 134A and 134B are contrary to the intention of Clause 100, as I described it a moment ago.
The Committee will recall that many matters, notably the identity of qualifying tenants and the valuation of property, relate back to the conditions as they stood at the day the applicant served his initial application—"the relevant date". We have just discussed that with regard to the purchase price. Flats vacant on that date and houses or flats which fall vacant between the relevant date and completion should be available for transfer with vacant possession at completion if the applicant so wishes. I am afraid that some landlords would seek, if they could, to use relets arising during this period in a way not calculated to ease the applicant's subsequent management task.
Amendments Nos. 134A and 134B would open the way to such reletting. They would allow landlords to grant secure tenancies right up to the completion of the procedures under Clause 101. As our own amendments in this group to Clause 100, to which I shall turn in a moment, make clear, we must have a structure which is fair to both sides—allowing the landlord to go on using vacant dwellings, but enabling and requiring him to deliver vacant possession at completion. I believe that, operated with goodwill, there is nothing in Clause 100 which will necessarily damage the interests of any of the parties involved—landlord, applicant or tenants. I beg to move.
Lord McIntosh of Haringey: I rise to speak to Amendments Nos. 134A and 134B and to refer to Amendments Nos. 133, 134 and 135. I am bound to say that I found the Minister's explanation an exercise in advanced paranoia. The Government seem to have drafted the whole of Clause 100 on the basis that local authorities are unscrupulous bunches of people whose only concern is to avoid at all costs the transfer of properties, and that they are quite capable of filling up these vast numbers of empty properties which the Government keep on speaking about with tenants who will oppose the transfer of properties simply to frustrate the wishes of the applicants.
That cannot be the case. First, it is not true that there are these vast numbers of empty properties—at least not in comparison with the proportion of empty properties held by housing associations and, above all, by the police and government departments such as the Ministry of Defence. They have far higher percentages of voids than local authorities. Secondly, even if the wishes of local authorities were to be so malign as to seek to frustrate any transfer of properties, they could not do that. Local authorities have allocation procedures. As properties become vacant, they have to keep them. If local authorities can be shown to be acting irrationally or in conflict with those procedures, then they are subject to a charge of maladministration and they can have the local authority ombudsman come down upon them.
I have not had to say it as regards every amendment in this Bill, but this is an example of the extreme prejudice which the Government have against the workings of local authorities. It reflects very badly on their thinking regarding housing policy and the openness and even-handedness which I hoped that the Government would be showing local authorities. Though I have been inclined to interpret charitably many of the motives of the Government in putting forward this Bill, it makes me doubt whether I was right. I am sorry to see Clause No. 100 in the form in which it is, and I am sorry to see these amendments to it. I am sorry to hear the objections of the Government to Amendments Nos. 134A and 134B.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 134:
Page 75, line 40, leave out ("included in the acquisition") and insert ("proposed to be acquired').
On Question. amendment agreed to.
[Amendments Nos. 134A and 134B not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 135:
Page 75. line 45, at end insert—
("(2A) Notwithstanding anything in any enactment, a tenancy or licence to which this section applies—

(a) shall not be a secure tenancy, and

(b) shall not be capable of becoming an assured tenancy or an assured agricultural occupancy,

and neither Part II of the Landlord and Tenant Act 1954 (business tenancies) nor Parts III to VI of the Agricultural Holdings Act 1986 (tenancies of agricultural holdings, including market gardens and smallholdings) shall apply to a tenancy or licence to which this section applies.

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(3) Every tenancy or licence to which this section applies shall be determinable by the landlord or licensor by giving not less than four weeks' notice to quit expiring at any time during the tenancy; and this subsection has effect whether or not the tenancy or licence is periodic and, if it is periodic, regardless of the length of the period.
(4) The Secretary of State may make regulations—

(a) requiring the public sector landlord to give notice to the applicant of the grant of any tenancy or licence to which this section applies;

(b) requiring the public sector landlord to give notice of the effect of this section to any tenant or licensee under a tenancy or licence to which this section applies;

(c) for securing that, on the transfer of the property included in the acquisition to the applicant, the public sector landlord gives vacant possession of any property subject to a tenancy or licence to which this section applies;

(d) that, in so far as vacant possession is not so given, any costs or expenses attributable to the recovery of vacant possession by the applicant and any losses consequent upon the failure of the public sector landlord to give vacant possession are recoverable by the applicant from that landlord as a simple contract debt; and

(e) making provision for and in connection with the disapplication of this section in any case where the applicant does not proceed with the acquisition.")

On Question, amendment agreed to.
Clause 100, as amended, agreed to.
Clause 101 [Consultations by applicant]:
Lord Dean of Beswick Lord Dean of Beswick moved Amendment No.135A:
Page 75, line 47, leave out ("prescribed") and insert ("relevant to subsection (3) below").
The noble Lord said: I believe that the Committee is considering Amendments Nos. 135A and 135B together. I wish to be as brief as possible because of the time. This amendment replaces the motion of consultation by the applicant who, one would agree, is not independent in the matter but has his own particular interests as a prime motive. Certainly, it cannot be said to be as objective as a properly conducted ballot administered by an independent body.
We are asking that the consultation procedures be changed and the concept of a secret ballot administered by a body of independent and accountable individuals be used in this particular exercise, because it is deeply enshrined in our understanding of democracy. We believe that if we depart from that in this particular case it may well be not the only time that it happens and that this procedure will be used on future occasions. This should not be allowed to happen.
The Government agreed to democratically controlled voting procedures as regards the transfer of new town housing; and while they did not like the results of such procedures, in our opinion that is no justification to abandon that kind of procedure in the present Bill. I beg to move.
The Earl of Caithness: I hope that I can explain to the satisfaction of the Committee how our proposals meet the concern which underlies Amendment No. 135B. As I read it (and though the two are linked) Amendment No. 135A seems to be more relevant to Amendment No. 136A, and I shall have more to say about it in due course.
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The balloting aspects of consultation will be carried out, as we discussed earlier, by the independent teller. The applicant will be obliged to employ the teller as a condition of his approval. Also as a condition of the applicant's approval the corporation will lay down in considerable detail the nature of the work that the contract between the two will require. The contract will be an obligation to treat in strict confidence information about an individual's vote that the teller obtains during the ballot.
We intend, through the Housing Corporation's control of the terms of the teller's contract, to ensure that if an application succeeds, the teller informs the applicant of the identities only of those tenants who have voted "No". These must be provided by the applicant to the landlord under Clause 102(3) as part of his notice of intention to proceed. This is necessary because these are the tenants whose homes must be excluded from the application or leased back (in the case of flats). Incidentally, the fact that a tenant's vote determines the future of his individual tenancy in this way, as well as helping collectively to decide the outcome of the application, means that the ballot cannot be secret, as the noble Lord's amendment would require, if by that he means anonymous. The teller's contract will prevent him, however, from giving the applicant any information about how tenants have voted in cases where the application has failed, and will require him to destroy the ballot papers after a due period has elapsed. I am sure that the noble Lord will welcome our intentions in this regard. I hope that helps the noble Lord with his understanding of the Bill.
Lord Dean of Beswick: It is late and I do not want to go into detail, but after a Division earlier I was disturbed when I met a group of tenants from a small authority in Essex which has just over 2,000 houses. They have been subjected to some form of consultation organised by the Electoral Reform Society on behalf of the local authority. I find it strange that the Electoral Reform Society is being used by a local authority which because of other privatisations wants to unload its housing.
The questions that those tenants were asked did not mention the local authority. They were asked whether they wanted to become part of a new landlord's set up. I was concerned by what they told me. They were responsible people. I asked them to forward the relevant documents to me so that my colleagues and I could look at them and if necessary meet them to see what form of consultation is being conducted by the Electoral Reform Society. We all know that the way in which people vote depends upon what is on the form. That is not a secret ballot.
I remember the late stages of a previous Housing Bill which was going through this place. I believe that my noble friend Lord Graham was present when I suggested that local authority tenants should have a secret ballot. We were discussing a similar issue. Everyone agreed with the proposal. The main reason it was rejected was the cost to the local authority. One or two Peers on the Government side took that view.

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and this place voted accordingly. We did not argue about the principle of a secret ballot; we merely argued about the cost.
People should have an adequate description of what they are being asked about. They should be allowed to put their ballot into a box as we are allowed to do in local authority and Euro-elections although not in the general election. The Minister should have a longer look at the matter or the Government may be accused of not having the type of ballot that was first expected.
The Earl of Caithness: I shall read with care what the noble Lord, Lord Dean, said. He gave an example which slightly perplexed me. I wonder whether the tenants to whom he spoke were tenants under tenants' choice or whether it was a local authority disposal under Part V of the Bill, which we shall be discussing tomorrow.
Lord Dean of Beswick: I do not want to go into further details. The authority is small. It has only 2,000 houses. Those people are being dealt with almost as the Bill says they will be dealt with in future. That causes me concern. I was asked to meet the tenants and I asked them to send me all the relevant details. I do not know whether the local authority was acting in accordance with existing statutes.
A public meeting on the issue was called to which the tenants' association was not invited. If some local authorites are beginning to behave in that manner it will give the Government's programme a bad name. I do not believe that any of us want that behaviour. I do not want to go too deeply into the matter tonight. I shall make my colleagues aware of the position so that we can discuss the matter at a later stage. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 135B not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 135C:
Page 76, line 4, leave out from ("applies") to end of line 5.
On Question, amendment agreed to.
[Amendments Nos. 135D and 135E not moved.]
10.45 p.m.
The Earl of Caithness The Earl of Caithness moved Amendment No. 135F:
Page 76, line 6, after ("applies") insert ("(a)").
On Question, amendment agreed to.
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 135G:
Page 76, line 6, after first ("tenant") insert ("and in the case of joint qualifying tenants to each individually").
The noble Lord said: For the convenience of the Committee I shall speak also to Amendments Nos. 135J and 136G, even though I understand that the Minister will be explaining the purport of the latter.
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I hope he will understand that I shall be commenting on the amendment before he moves it, because this is my opportunity to speak on the matter.
The amendments deal simply with common equity. What we seek by way of these amendments is that among those people to be consulted in the consultation process shall be a number of people who are at present excluded from so doing on the face of the Bill. In the case of joint qualifying tenants in joint tenancies we are arguing that each individual shall be capable of being consulted and that the categories of persons listed in the amendments shall also be consulted; that is to say:

(a) a non-tenant spouse provided he normally resides in the property, or any person normally living with another person as if they were husband or wife (at least one of whom is the tenant);

(b) any person entitled, by virtue of sections 87 and 89 of the Housing Act 1985, to succeed to the tenancy: and

(c) non-qualifying tenants whose tenancy would be materially affected by a transfer.").

We are arguing for legal rights. We believe that such people have rights in law but that the Bill as drawn excludes them from exercising those rights. We say that if those people had been included in the pre-selection procedure then it would have been a different matter. But they are not. We cannot accept that it makes sense to allow a decision about the future ownership of dwellings, the future services to tenants and the cost of housing provision to be made over the heads of many individuals with a legal interest in the dwellings. I think that the Minister must explain to the Committee, and perhaps to hundreds or thousands of people outside the Chamber, that that is what he intends to do.
The effect of the Minister's amendment is to give one vote per tenancy to joint tenants. We think that that is iniquitous. The Minister will understand that there can be situations where there are two joint tenants one of whom takes one view and one of whom takes the other. It happens politically inside a household. Forget the status of the two people. The Minister will know from his experience that many men and women sharing a home take different views, not just on general political matters. They could very well take different views on whether they want to take part and how they will vote in the transfer of the ownership of their homes.
There is the situation of separated couples, when one is occupying a home and the other is not, but they are joint tenants and are both entitled to be consulted. How one is to get proper consultation in those circumstances and how one is to decide which of the two is entitled- to cast the vote is a matter that can be avoided.
I very much hope that the Minister will reflect about putting forward his amendment, because I believe it is mischievous in the extreme, and it is narrow. I very much hope that he will look kindly upon the amendments that I have moved. I beg to move.
The Earl of Caithness: Government Amendment No. 136G to which the noble Lord, Lord Graham of Edmonton, quite rightly in the grouping of this amendment. has made reference, follows a

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commitment in another place by my honourable friend and predecessor as Minister of Housing to look again at the position of joint tenants under the consultation and voting provisions. We have done so, and have concluded that the Bill would benefit from clarification on the point.
It is our view that there should be—and indeed I must say that there can be—only one vote per tanancy. Any other approach would give large households, as I am sure the noble Lord, Lord Graham of Edmonton, would be the first to agree with me, a greater right in the collective decision, and it could give rise to impossible results as regards the individual elements, with a dwelling supposedly having to be held by both old and new landlords. That is neither legal sense nor common sense. We have therefore proposed the new Clause 102 (2A) which provides that a vote by joint tenants must be cast by one on behalf of them all. Any other vote will be invalid as if it had not been cast at all.
It follows, therefore, that we cannot accept the general thesis underlying the amendments that have been moved by the noble Lord, Lord Graham of Edmonton. The first of those is Amendment No. I 35J, which provides that not only joint tenants but all other members of the household or family should be separately entitled to be consulted, or even that joint tenants should have separate votes as proposed in Amendment No. 135G. I think it fair to say that we should give families the credit for being able in most circumstances to sort out their own joint view. For other unhappy circumstances that may well not be the case, but we should not compound the situation by making it give rise to a conflicting set of decisions.
We have given this very careful consideration, and we believe that the answer that we have come up with, which is Amendment No. 136G, is in fact the right one.
Lord Graham of Edmonton: The noble Earl has demonstrated that he grasps what I am trying to avoid. He illustrated the large family. Let us suppose that there are five adults and they have one vote between them. They have to sort out how that one vote is going to be cast. If they have their family discussion and all five agree one way or the other there is no harm done; they are of one mind even though they may not win in the ballot. But if there is a split, whether it is four to one or three to two, I can well imagine that what they may decide is that unless there is unanimity they will not cast their vote at all because whichever way they cast the vote it will be against the wishes of some of those in the house. In other words, if they do not vote it is a negative vote and will be counted in with those who are in favour of the transfer. We went through that argument earlier on.
In my view, democracy does not mean one house one vote; it means one man or one woman a vote. The fact that five adults in a house will be affected by a change means that there are five people entitled to vote. Of course it means that in one house there will be five votes as opposed to one vote in another house. The same thing happens in elections. In general elections, there is not one vote per house; there is one
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vote per person. I think the Minister is being very restrictive. I could not anticipate whether it would be of benefit to transfer the property or not to transfer the property. I genuinely do not know. We are arguing about the equity and morality of it. However, the Minister is not in a receptive mood at this time on the issue, so I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
The Earl of Caithness The Earl of Caithness moved Amendment No. 135H:
Page 76, line 8, at end insert ("and

(b) to any tenant of a description prescribed for the purposes of section 99(2) above; and

(c) to any tenant of a description prescribed for the purposes of this section.").

On Question, amendment agreed to.
[Amendments Nos. 135J and 136 not moved.]
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No 136A:
Page 76, line 8, at end insert—
("(3) The relevant period referred to in subsection (1) shall be a minimum of—

(a) 4 weeks in the case of up to 10 dwellings;

(b) 8 weeks in the case of more than 10 and up to 50 dwellings;

(c) 12 weeks in the case of more than 50 dwellings.").

The noble Lord said: I owe the Minister and the Committee an apology. The Minister is quite right in saying that we should have been debating Amendments Nos. 135A and 136A together. They are on the same subject and I apologise to the Committee for not having appreciated that and for having distorted the groupings under which we were discussing these amendments.
The point of these amendments, for which Amendment No. 135A is really a paving amendment, is a very simple one. We are proposing a time-scale for consultation with the tenants under Clause 101 which recognises that it is far more difficult to consult a lot of tenants than it is to consult a smaller number of tenants. The Bill is full of time-limits and time-scales. We are not proposing anything remarkable in that respect, but I think it is possibly the only occasion on which we recognise that in this Bill there are major differences between small estates, small applications and large applications. We are suggesting that this is a matter which ought to be recognised on the face of the Bill rather than being left to subsequent regulations.
It is not just important that this should be done for the first time. It should be clear to those who are proposing to take over the secure tenancies that consultation with tenants is not just a bit of window dressing. Consultation with tenants is the essence of good landlord behaviour and ought to continue, whoever the landlord is going to be. It is important that the tenants should know what is being proposed. It is important that they should have time to discuss the matter among themselves, whether within households, as we have just been considering, or between households, and that they should have an opportunity to seek advice on the proper course of action for them.
For all those reasons, I beg to move Amendment No. 136A.
11 p.m.
The Earl of Caithness: We intend, as I have mentioned, to prepare detailed regulations governing consultation under Clause 101. One important issue to be covered will be timing. The amendments of the noble Lord, Lord McIntosh of Haringey, suggest a statutory scale for this, varying with the size of the application. He does not specify from when the period would run, but the natural reference point would be the service of a notice by the landlord under Clause 98 proposing a purchase price or the determination of any dispute under Clause 98 by the district valuer, whichever was the later. I am pleased to be able to tell the noble Lord that in no case, involving applications of any size, do we intend to allow less than 10 weeks for the applicant and teller to prepare for consultation and carry it out.
We want, as I am sure does the noble Lord, to keep the procedures moving at a brisk pace, but accept that the practicalities and the tenants' interests require provisions on these lines, albeit not on the face of the Bill. So we very nearly go all the way to meet the noble Lord. We meet him on two out of three of the situations that he puts forward in (a) and (b), and we very nearly meet him on (c).
Lord McIntosh of Haringey: I am grateful to the Minister. Will he tell the Committee what he means by "any size"? He mentioned that applications involving a number of properties of any size—I assume he meant any considerable size—would involve not less than 10 weeks' consultation. What is the figure for any size?
The Earl of Caithness: That will depend on the applicant and the tenants.
Lord McIntosh of Haringey: I do not think that that will do, but we have gone so far towards common sense and the recognition of common sense that it would be churlish for me to do other than beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 136B not moved.]
Clause 101, as amended, agreed to.
Clause 102 [Notice by applicant of intention to proceed]:
[Amendments Nos. 136C and 136D not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 136E:
Page 76, line 14. leave out ("as mentioned in section 99(2) above") and insert ("in such manner as may be prescribed of their wish to continue as tenants of the landlord").
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey had given notice of his intention to move Amendment No. 136F:
Page 76, line 15, leave out ("to whom that section applies") and insert ("who notify the applicant in such manner as may be prescribed of either—

(a) their wish to continue as a tenant of the landlord: or

(b) their wish to accept the applicant's offer.").

The noble Lord said: For the reasons I gave when speaking to Amendment No. 132ZC, standing in the name of the noble Lord, Lord Ross of Newport, I do not propose to move this amendment at this time.
[Amendment No. 136F not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 136G:
Page 76, line 15, at end insert—
("(2A) In any case where a tenancy is held by two or more persons jointly, those persons shall be regarded as a single tenant for the purposes of subsection (2) above and, accordingly, any notice given in response to the consultation under section 101 above shall be of no effect for the purposes of subsection (2) above unless it is given by or on behalf of all the joint tenants.").
On Question, amendment agreed to.
[Amendments Nos. 137 and 137A not moved.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 137B:
Page 76, line 35, leave out ("section 99(2)") and insert ("subsection (2)").
On Question, amendment agreed to.
Clause 102, as amended, agreed to.
Clause 103 [Duty to complete]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 138:
Page 77, line 12, after ("by") insert ("the preceding provisions of").
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 139:
Page 77, line 12, at end insert—
("() Without prejudice to the application of Part VIII of the Local Government, Planning and Land Act 1980 (capital expenditure of local authorities) to the price received by the landlord on the disposal (as mentioned in subsection (1)(a) above) of the property included in the acquisition, where there is a disposal cost attributable to that property any payments made by the landlord in respect of that cost shall he prescribed expenditure for the purposes of that Part.").
The noble Earl said: The effect of this amendment is quite simply to ensure that expenditure arising from disposals under tenants' choice should be subject to the usual controls on local authorities' capital expenditure.
Local authorities will be able to benefit from any receipts generated by disposal in the same way as for any other receipts. Equally, under this amendment any disposal costs which might be incurred will count against the authority's prescribed expenditure limit. I beg to move.
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 140:
Page 77. line 12, at end insert—
("(4) Notwithstanding anything in section 141 of the Law of Property Act 1925 (rent and benefit of lessee's covenants to run with the reversion) any rent or other sum which—

(a) arises under a tenancy of any property included in the acquisition, and

(b) falls due before the date of the grant under subsection (1) above,

shall continue to be recoverable by the landlord to the exclusion of the applicant and of any other person in whom the reversion on the tenancy may become vested.").
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 140A:
Page 77, line 12, at end insert—
("(4) Once a grant of the property in accordance with subsection (1)(a) above has been made the applicant shall, in accordance with regulations made under subsection (4A) below, notify tenants of dwellings so acquired of the following on an annual basis—

(a) details of the applicant's holdings of residential properties in any specified area;

(b) information regarding the applicant's business interests;

(c) information regarding the applicant's financial status;

(d) details of all tenant's associations active within any part of the applicant's dwelling work within any specified area;

(e) details of any new acquisitions under this Part within any specified area;

(f) details of any disposals of dwelling stock (other than under Right to Buy) within any specified area.

(4A) The Secretary of State shall publish regulations as to the provision of information under this section, and any such regulations may prescribe any area with respect to which the requirements of paragraphs (4)(a), (d), (e) or (f) above shall apply.
(5) The applicant shall forthwith inform such tenants as to any new address of the applicant's head office or any other offices serving such tenants.").
The noble Lord' said: The wording of this amendment may seem familiar in relation to previous amendments. However, whenever the opportunity arises to protect tenants against unscrupulous applicants—there could be unscrupulous housing applicants and on this occasion I am not referring to housing associations or tenants' co-operatives—I believe that it is important that we should try to do so. What we are seeking in Amendment No. 140A is that after a grant of a property has been made, the applicant—namely, the new landlord—should notify the tenants on an annual basis of the details of his holdings of residential properties, his business interests, his financial status, the details of any other tenants or tenants' associations they ought to know about and might wish to he associated with, and any new acquisitions which the new landlord is making, and indeed of disposals of dwellng stock.
Those who have been following this Bill attentively, particularly at Second Reading, will be aware how strongly we on this side of the Chamber feel about the problem of bad landlords. We gave the example—at some length but necessarily at length I am afraid—of Mr Nicholas Hoogstraten, who not only is a bad landlord but boasts of being a bad landlord. We showed, I believe convincingly, that he has not only sought to conceal his true activities by using a large number of different names—business names as well as individual names—and also by changing rapidly the names under which he owns properties.
Therefore it is important, if we are to avoid that kind of exploitation of tenants—which could occur in transfers of this kind—that such information should always be made available by statute to tenants, and that it should be made available on an annual basis. Unless we put such a provision on the face of the Bill and enforce it rigorously people like Mr Hoogstraten will continue to get away with the kind of exploitation of tenants which your Lordships were told about at Second Reading and to which reference has been made in the earlier stages of the passage of this Bill in Committee. I beg to move.
The Earl of Caithness: This amendment would require tenants' choice landlords to inform their tenants every year of a great long list of facts which I doubt many of them will want. They would receive details of all their landlord's acquisitions or disposals of property under tenants' choice in their area, of all the local tenants' associations, of any non tenants' choice properties held by their landlord in their area; not to mention details of the business and financial interests of their landlord. Presumably, the Secretary of State's regulatory powers in proposed subsection (4A) might be able to limit the latter to the interests relating to housing; but, even so, this remains a formidable list.
Most of the items are ones which the Housing Corporation will certainly monitor after transfer. However, that will be in order to apply its statutory role in relation to approved landlords by ensuring that they continue to comply with the conditions of that approval. If tenants want to be kept informed individually to this extent, then they will have to make that clear to any prospective landlord, at the pre-selection stage or during the course of the application. The applicant's intentions regarding that consultation and information after transfer will be a factor in the formal consultation procedure. Like all other aspects of the formal offer made in that consultation, it will be contractually binding if transfer proceeds.
This seems to me to be the right way for tenants to ensure that they receive the information which they consider essential or relevant. We believe subsection (5) to be unnecessary because Section 1 of the Landlord and Tenant Act 1985 requires the landlord or his agent or rent collector to tell the tenant the landlord's name and address on request within 21 days. It is an offence to fail to do so without reasonable excuse. Section 2 applies the same rights and duties to the name and address of every director and of the secretary of the landlord. Tenants' choice landlords will be expected to let tenants know about their local management arrangements.
I fully take on board the points made by the noble Lord, Lord McIntosh, about bad landlords. It takes us back to our discussions on Part I of the Bill, when I agreed with him and all Members of the Committee that the last thing we want is bad landlords. That is why we are asking the Housing Corporation to take on the very important role of vetting landlords for tenants' choice. I agree that we need to make sure that the landlords are vetted. The Housing Corporation is putting down strict criteria. They will have to sign a tenants' guarantee, which is also very important.
We believe that that is the right way to protect the tenants. It is the right way also to weed out potentially bad landlords; we do not want them.
Lord Swinfen: I am sure that the noble Lord, Lord McIntosh, will realise that gathering this information could be expensive, particularly in respect of

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paragraph (d), when the landlord has not been advised by the tenants' associations. The last thing the noble Lord will want is higher rents for the tenants. All that will happen is that the cost of gathering this information and sending it to the tenants will be passed on in the form of higher rents.
Lord McIntosh of Haringey: Perhaps I may deal with that point first. The noble Lord, Lord Swinfen, is arguing against his own Front Bench. We have just been told by the Minister that that information will have to be gathered anyway in order to be supplied to the Housing Corporation. So the only additional cost likely to be incurred is not in gathering the information but in sending it to the tenants, and that cannot be the major part of the cost to which he refers.
The trouble with the Minister's argument is that the situation about which we are speaking concerns only one in 10. Let us hope that it is only one in 100. That may well be the case. But it is exactly in the case of the one in 10, or one in 100, bad landlord that the tenants need to be notified of something that is going wrong and have the opportunity to protest about it. It would be nice to think that it could be left cheerfully to the Housing Corporation to put right any deficiency that may be found in the landlord's policy and to associate it with any deficiency which arises from the landlord's other business or housing interests. I think that it is unrealistic to think that the Housing Corporation can devote that degree of scrutiny to all the new landlords who will be producing the reports.
We are suggesting a much more efficient system. We suggest that the tenants who are directly concerned with the probity of the landlord should have an opportunity to discover whether that landlord is indeed worthy of trust. They should be the ones who vet and scrutinise the information given to them by the landlord and who then complain to the Housing Corporation if there is something wrong. I suggest to the Committee that that is a far more realistic way of proceeding than putting the duty on some office on the sixth floor of a building in Tottenham Court Road and expecting people who are looking at thousands probably of these applications to be able to make a realistic assessment of what might be wrong with the quality of the landlord's policy and the probity of his business operation.
I still think that we are right in proposing this amendment. It would not be a significant addition to the costs of either the landlord—certainly, the good landlord—or the operation of the tenants' choice scheme. At this time of night I do not consider it appropriate to pursue the matter to a Division. In the light of what the Minister has said I should like to think that we could return to this matter at a later stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 103 as amended, agreed to.
11.15 p.m.
Clause 104 [Consent required for subsequent disposals]:
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendments Nos. 140B to 140D:
Page 77, line 34, at end insert—
("() Where an approved landlord wishes to dispose of property he may do so only to another approved landlord".).
Page 77, line 34, at end insert—
("() In giving consent to any application to any alternative owner except the local authority and for any purpose the Secretary of State shall have regard to—

(a) the level of homelessness in the locality;

(b) the level of housing need in the locality;

(c) the availability of housing for rent in the locality.").

Page 77, line 34, at end insert—
("() All tenants affected by a disposal under this section shall be consulted in line with the arrangements of sections (101) and (102) above and the views of tenants thus obtained shall be taken into account by the Secretary of State when determining an application for consent under this section.").
The noble Lord said: These amendments make provision for the Minister to say something helpful about matters that have been touched upon earlier. It is the basis and terms upon which, after the first new tenants' choice landlord has been designated and is operating he is then able to divest himself of the properties and pass them on to a new landlord.
We want the Minister to understand—and this comes out in particular in Amendment No. 140C—that we do not wish to find that there is one face which is acceptable to the Minister but that behind that face there is a shell where the same people, the same company, the raison —étre, is operating differently. In Amendment No. 140C we wish a number of matters to be borne in mind by the Minister before the permissions are given. They are the levels of homelessness and of housing need and the availability of housing for rent in the locality. We want the Minister to recognise this and the need to make provision for these people. We do not wish the situation to arise where the housing needs in the area are not met, or are not met as adequately as they should be.
I have a number of pieces of evidence here which relate to the kind of thing that can happen. We want the Minister to give an assurance that it is his intention to make sure that the good vetting procedures operable in the first instance are carried on. I beg to move.
Lord Ross of Newport: Perhaps I may briefly support these amendments and in particular Amendment No. 140C which deals with subsequent disposals. It is very important that these matters should be taken into account. I hope very much that the Minister will be able to confirm that they are matters which will concern the Secretary of State before any approval of the subsequent disposal is allowed to proceed. I beg him at least to give some assurance on that point.
The Earl of Caithness: I must begin what I say about these amendments with a word of caution, more addressed to myself than to Members of the

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Committee. The powers that Clause 104 will give to my right honourable friend to control subsequent disposals of property transferred under tenants' choice constitute a statutory discretion. That means that each and every application he receives for consent will have to be taken on its merits, and I must therefore be very careful now not to say anything that would fetter my right honourable friend's exercise of that discretion in the future.
Amendment No. 140B would restrict the ability of an owner to dispose of property he had acquired under tenants' choice to disposals to approved landlords—approved, presumably under Clause 93 for the purposes of tenants' choice. Members of the Committee will recall that we have touched upon this already in an exchange between the noble Lord, Lord McIntosh of Haringey, and myself. We believe that this restriction is rather too closely drawn. There would be no point in requiring a would-be purchaser to go through the formal hoops under Clause 93 when there was an effective alternative control available; namely, the need to satisfy the Secretary of State that the arrangements surrounding the proposed disposal—which could obviously involve looking at the identity of the proposed recipient—were acceptable. I think I would not be going too far, however, if I were to say that I would expect the general policy of my right honourable friend to be very likely to favour responsible and viable landlords who were committed to the contents of our tenants' guarantee.
Amendment No. 140C seems, though I suspect not deliberately, unnecessarily to hamper any voluntary sales of transferred property to sitting tenants. More strictly on the noble Lord's point, I am advised that the matters mentioned in the amendment are matters which could be relevant to my right honourable friend's consideration of an application. However, I share my predecessor's feelings expressed in another place that we must resist the temptation to build them into what he called a great formal procedure, mirroring the panoply of criteria and detailed controls applying to tenants' choice itself.
Similarly, concerning Amendment No. 140D, I can well imagine that my right honourable friend might require some form of tenant consultation in certain cases, perhaps on the lines of the requirements already applied to voluntary disposals by local housing authorities. But it would be wrong for me to fetter his discretion at this stage and I believe we must avoid the contribution which the amendment would make to a new panoply of detailed controls.
Finally, I make the general point that two of the reasons we have proposed the power in Clause 104 are to give scope to allow for a measure of control over the future use of transferred property which was originally provided to meet the local need for renting and to give tenants the reassurance that their homes, once transferred, cannot be transferred on, free from control, to new ownership and for new purposes.
The fact is that we shall be looking for tenants' choice landlords to be in the business of providing rented accommodation in the long term. Therefore we expect the circumstances in which property would be transferred on to be limited. We have recently been
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looking again at the clause in this light and I expect that we may bring forward technical amendments to improve it at a later stage.
Lord Graham of Edmonton: I appreciate what the Minister has said. I shall read very carefully what he has said, consult others outside and I may come back again. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 140C and 140D not moved.]
Clause 104 agreed to.
Clause 105 [Service of information, advice and assistance]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 141:
Page 77, line 36, leave of ("Part IV") and insert ("this Part").
The noble Earl said: This is a drafting amendment. I beg to move.
On Question, amendment agreed to.
Lord Dean of Beswick Lord Dean of Beswick moved Amendment No. 141A:
Page 78, line 3, at end insert—
("(4) An approved landlord holding property acquired under this post shall have an obligation to accept nominations from the local authority from whom such property was acquired in respect of households accepted as homeless and in priority, subject to appropriate vacancies being available").
The noble Lord said: The Minister has given quite an extensive reply to the previous amendment moved by my colleague, Lord Graham, but on this amendment I want to make the point that the Bill does not mention homelessness. However, local authorities will retain a statutory duty to house homeless households. They can only achieve this with the assistance of other social landlords and such assistance should be an obligation in return for acquisition under this proposal, because, had such an acquisition not taken place, obviously the vacancies would have been available for homeless households.
I do not want to detain the Committee at this hour, but I want to make the point that as recently as this week the Institute of Housing issued a report showing the doubling of homeless families in the country over the last 10 years. Despite what the Government could claim as some successes in various housing fields it is a fact that there are now substantially fewer houses to let and available for homeless people than there have been for a long, long time.
My colleagues and I are seeking to ensure that there is no further haemorrhaging of properties away from those that would have been available had the tenanted sections in both the public and private sectors retained the same dimension. I do not want to enlarge on the debates that have taken place in the past about the sale of council houses. The Government have claimed success to which perhaps they are entitled, but there is no question that even some of those houses would have been available in the letting sector for homeless people. Our concern is that there is no further diminution of houses available to house homeless people for whom the local authority has the statutory responsibility.
I do not expect the Minister to give a lengthy reply but I wish to make him aware of our concerns. I hope that he will give the matter further consideration in the later stages of the Bill.
The Earl of Caithness: As the noble Lord knows, we are reviewing the situation of the homeless and I have already mentioned that I am looking with interest at the reports put forward.
I believe that at this stage it is worth bringing to the attention of the Committee the fact that it is already common for housing associations to offer a proportion of nomination rights to local authorities. I see no reason why that practice should not continue voluntarily. It is already open to local authorities to negotiate nomination rights with any successor landlords under Part IV or by voluntary disposals. We do not need to legislate for that.
I take the point of the concern of the noble Lord. I believe that it can be done voluntarily. The last thing anyone wants is to see the number of homeless increase and that is why we want to see a better, more diverse and more plentiful rented sector.
Lord Dean of Beswick: I am grateful for the Minister's somewhat sympathetic reply. He has assured the Committee that the matter is under review by the Government and I know that they are concerned about the situation. On that basis I look forward to seeing what eventually emerges and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 105, as amended, agreed to.
Clauses 106 and 107 agreed to.
Schedule 12 [Registration of title and related matters]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 141B:
Page 143, line 4, at end insert—
("(2A) The Chief Land Registrar shall, for the purpose of the registration of title, accept such a certificate as is referred to in sub-paragraph (2)(b) above as sufficient evidence of the facts stated in it; but if as a result he has to meet a claim under the Land Registration Acts 1925 to 1986 the landlord is liable to indemnify him.").
The noble Earl said: We have always said that we do not want the processes of any tenants' choice application to take longer than they have to, and this amendment deals with one possible source of delay by clarifying the procedure for land registration under tenants' choice. I beg to move.
On Question, amendment agreed to.
Schedule 12, as amended, agreed to.
Clause 108 [Public open space etc.]:
The Earl of Caithness The Earl of Caithness moved Amendment No.141C:
Page 79, line 16, at end insert—
("() Nothing in section 5 of the Green Belt (London and Home Counties) Act 1938 (restrictions on alienation of land by local authorities) applies in relation to a disposal of land included in an acquisition under this Part.").
The noble Earl said: On 29th March this year, Mr. Justice McNeill gave judgment that the provisions of Section 5 of the 1938 Green Belt (London and Home Counties) Act were not misplaced by the right to buy provisions in the 1985 Housing Act. This means that any right to buy sales, and by implication any tenants' choice disposals, which involve land subject to Section 5 of the green belt Act would have to have the specific consent of the Secretary of State, involving a separate set of statutory procedures, possibly a public inquiry.
Obviously, we do not want secure council tenants to have unnecessary additional obstacles placed in the way of their efforts to seek a new landlord. We feel that an amendment to disapply the relevant section of the green belt Act is necessary. This is the amendment, and I beg to move.
Lord McIntosh of Haringey: I intervene not because I disagree with the amendment but because, in the presence of the Leader and Deputy Leader of the House, I should like to take this opportunity to congratulate the noble Earl on surviving a long Committee day entirely by himself. It is a tribute to his stamina and intellectual agility that he has succeeded in doing so. It is also a tribute to the paucity of talent on the Government Front Bench that he has been forced to do so.
I understand that he must do so again tomorrow and then speak to the Conservative Party annual conference on Wednesday. The relevance of that remark is that I hope he does not have to speak in the debate in which the Secretary of State is going to be torn apart by the wolves at Brighton because of his proposed intrusions into the green belt and into country land for building in southern England. In the meantime, I believe that this present amendment is worthy of the support of the Committee.
The Earl of Caithness: I am grateful for the kind words of the noble Lord, Lord McIntosh of Haringey. Bearing in mind what he has said, perhaps he could give me an early night tomorrow night.
I can tell the noble Lord that there is growing and lively talent on the Government Front Bench, and at Report stage he will not only have to condition himself to me, but there will be others taking part as well. With regard to the question of the green belt, the noble Lord knows that we have doubled it since 1979.
On Question, amendment agreed to.
Clause 108, as amended, agreed to.
11.30 p.m.
Clause 109 [Extension etc. of relevant periods]:
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 141D:
Page 79, line 38, at end insert—
("(5) Where an applicant withdraws his application, or where an application fails there shall be no right to make a further application in respect of substantially the same set of dwellings for a period of two years.").
The noble Lord said: I think that the Minister should understand that tonight is the early night: you ain't heard nothing yet! The gravamen of this

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amendment is this. Where an applicant in the process of having housing stock transferred to him withdraws or in effect is beaten by the ballot, the tenants affected should not be subjected to another application for a period of not less than two years. I think that that is reasonable, sensible and just. I beg to move.
The Earl of Caithness: I understand the concern of the noble Lord that council tenants should not be subjected to a barrage of unwelcome applications. In reply to that I can say with confidence that the corporation's preliminary contest and the tenants' voice in that contest protects those tenants who are genuinely not interested in a transfer from being pursued by applicants. I am sure that the corporation will pay particular attention to cases where a second application is made for the homes of tenants who have already voted down one application.
There is the further point that I do not see why one should deny tenants the opportunity to find another landlord—if that is what they prefer—merely because they have to wait for a two-year process.
I understand the point about not wanting the tenants to suffer from a barrage of unwelcome applications. I do not know how one could implement this in practice, even if one agreed with the noble Lord's thesis. It would be extremely difficult. Perhaps I may look at this again—in particular at the situation where an application has failed. I do not give any guarantees that I can agree to it; but I should like to look at that point in particular.
Lord Graham of Edmonton: Any speech of the Minister which ends with the words that he is prepared to look at what we have said is more than welcome.
The Minister should take on board that unless there is some limit, there will aways be a group of tenants who, regardless of the quality of the landlord, want to get away from their existing landlord. The majority of tenants who are polled may say that they do not want to go to that landlord; but these people who want to get out of council tenure will then have the opportunity, unless there is a limit, to keep coming back. Apathy exists and people get fed up. That would be the negation of democracy. However, I am grateful that the Minister understands that we do not want tenants to be subjected to this at frequent intervals until finally there is a caving-in and they say: we will get rid of this. Tenants do get worried. My noble friend Lord McIntosh and I met over 1,000 tenants today at the Central Hall. They were not just worried; they were very, very angry. We shall have more to say about that tomorrow. I am grateful to the Minister for being willing to consider whether it is possible to take on board what I have said, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 109 agreed to.
Clauses 110 to 113 agreed to.
The Earl of Arran: I beg to move that the House do now resume.
Moved, accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at twenty-five minutes before midnight.