HL Deb 10 October 1988 vol 500 cc648-710

House again in Committee.

Clause 93 [Persons by whom right may be exercised]:

Lord Graham of Edmonton moved Amendment No. 130B:

Page 70, line 7, at end insert ("such criteria shall at least include the following—

  1. (a) the applicants' housing management experience;
  2. (b) the applicants' housing management performance;
  3. (c) the size of the applicants' existing housing stock in relation to the number of dwellings to be acquired;
  4. (d) the applicants' arrangements for consultation with their existing tenants;
  5. (e) the applicants' policy with regard to—
    1. (i) allocations,
    2. (ii) rent levels,
    3. (iii) rent review procedures,
    4. (iv) repairs,
    5. (v) improvements,
    6. (vi) equal opportunities,
    7. (vii) standard terms of tenancy offered;
  6. (f) the applicant's local connection and interests;
  7. (g) the applicant's accessibility to tenants;
  8. (h) the applicant's financial standing and stability;
  9. (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 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 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:

  1. "(iii) rent review procedures,
  2. (iv) repairs,
  3. (v) improvements,
  4. (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 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.

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 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 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 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 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 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 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—

  1. (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
  2. (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 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 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 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 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 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 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—

  1. (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
  2. (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—
  1. (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
  2. (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 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 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 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 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 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 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 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 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 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 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 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 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 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 Reportof 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 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 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 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 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? 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 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 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 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 moved Amendment No. 132V: Page 74, line 34, leave out ("may") and insert ("shall").

On Question, amendment agreed to.

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 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 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 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—

  1. (i) the applicant's obligations to the landlord;
  2. (ii) the applicant's obligations to the landlord's tenants;
  3. (iii) the rent payable;
  4. (iv) the arrangements for rent review;
  5. (v) the service charges payable;
  6. (vi) the arrangements for service charge review;
  7. (vii) the consultation rights between the landlord and the applicant;
  8. (viii) arrangements regarding the maintenance and management of communal areas;
  9. (ix) arrangements regarding any future disposals by the applicant;
  10. (x) the redemption value of the lease payable to the landlord by the applicant at the end of the term;
  11. (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 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.

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 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 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 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 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 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 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.

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 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 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 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 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 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—

  1. (a) shall not be a secure tenancy, and
  2. (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. (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—
  1. (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;
  2. (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;
  3. (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;
  4. (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
  5. (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 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.

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. 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 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 moved Amendment No. 135F:

Page 76, line 6, after ("applies") insert ("(a)").

On Question, amendment agreed to.

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. 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:

  1. (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);
  2. (b) any person entitled, by virtue of sections 87 and 89 of the Housing Act 1985, to succeed to the tenancy: and
  3. (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 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 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 moved Amendment No. 135H:

Page 76, line 8, at end insert ("and

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

  1. (a) 4 weeks in the case of up to 10 dwellings;
  2. (b) 8 weeks in the case of more than 10 and up to 50 dwellings;
  3. (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 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 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—

  1. (a) their wish to continue as a tenant of the landlord: or
  2. (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 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 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 moved Amendment No. 138:

Page 77, line 12, after ("by") insert ("the preceding provisions of").

On Question, amendment agreed to.

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 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—

  1. (a) arises under a tenancy of any property included in the acquisition, and
  2. (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 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—

  1. (a) details of the applicant's holdings of residential properties in any specified area;
  2. (b) information regarding the applicant's business interests;
  3. (c) information regarding the applicant's financial status;
  4. (d) details of all tenant's associations active within any part of the applicant's dwelling work within any specified area;
  5. (e) details of any new acquisitions under this Part within any specified area;
  6. (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 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 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—

  1. (a) the level of homelessness in the locality;
  2. (b) the level of housing need in the locality;
  3. (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 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 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 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 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 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 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 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 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.