HL Deb 13 October 2004 vol 665 cc372-80

8.33 p.m.

Consideration of amendments on Report resumed on Clause 129.

Lord Hanningfield moved Amendment No. 125:

Page 94, line 27, leave out "immediate"

The noble Lord said: My Lords, the need to show that "immediate" steps will be taken places too heavy a burden on the person who is likely to be the subject of the order. What is meant by "immediate" in any case? Does it mean tomorrow or next week? It may simply not be practicable in the circumstances, even though the owner may well wish to take action to ensure that the property is occupied without undue delay. Planning permission may need to be applied for. Work may need to be done. The proposed alternative wording gives more flexibility to enable full account to be taken of the circumstances without compromising the need to avoid undue delay. I beg to move.

Lord Rooker

My Lords, I am sympathetic to the objective behind the amendment. However, in normal speak, the revised wording would weaken the intention of the clause, which 1 am sure is not the intention of the noble Lord. It is possible to conceive of many situations where it is wholly impractical for the relevant proprietor to let the property. That may be precisely why an empty dwelling management order is the proper course of action. If a relevant proprietor has reasonable and practical proposals to secure occupation of a dwelling, the matter will never even get to the residential property tribunal. Once a matter reaches that tribunal we do not want to allow any delaying tactics to the procedure.

I remind the House once again that an interim empty dwelling management order is not the end of the matter. If the relevant proprietor is willing to co-operate, there is no reason why the management of the property should not very swiftly be returned to him. The whole point of the exercise is to have someone living in the dwelling. It is not for us to choose; we want the dwelling used.

I understand the intention behind the amendment which gives the relevant proprietor more time to take any steps. If he can convince people that he is getting on with the job, quite clearly the property will not be empty. That is the whole purpose of the exercise. If this gives a kick-start to those who own empty properties to get them brought back into use we will have done our job, perhaps without issuing a single order—one never knows.

Lord Hanningfield

My Lords, I thank the Minister for his reply. I accept what he says about empty properties being occupied as soon as possible. He also said that he had some sympathy with the way in which we have tabled this amendment. Like many issues that we have discussed today, the Government have some sympathy with what we are doing, as we are trying to improve the legislation. The points have been well received. I hope that there may be some rethinking on some of these issues before Third Reading. However, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 126 and 127 not moved.]

Lord Hanningfield moved Amendment No. 128:

Page 94, line 35, after "rights" insert wishes and intentions"

The noble Lord said: My Lords, this amendment allows the RPT to consider the wishes and intentions of the relevant proprietor and not just his rights. A proprietor may well intend to do other things with the property—perhaps to demolish it or to change it to non-residential accommodation. His wishes in this matter should, at least, be considered by the RPT before authorisation is given for the making of an EDMO. I beg to move.

Lord Rooker

My Lords, I do not want to sound at all dismissive—it is the way in which the amendments have been degrouped. On Amendment No. 121, I explained the fact that the tribunal has to consider those issues when authorising an interim empty dwelling management order. I explained that Amendment No. 121 was linked with Amendments Nos. 128 and 136 and that Amendment No. 121 was not necessary. The reasoning is exactly the same in relation to Amendment No. 128.

Lord Hanningfield

My Lords, I accept that answer from the Minister and thank him for it. Again, we shall look at this issue and consider whether we need to return to it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Hanham moved Amendment No. 129:

Page 94, line 36, at end insert ", and (c) the reason or reasons why the dwelling has been unoccupied

The noble Baroness said: My Lords, we believe that this is an important proposal. It requires the residential property tribunal to review the whole history of why a dwelling is unoccupied and why a local authority seeks to make an empty dwelling management order.

There may be very good reasons why the property has not been occupied in the past and will continue to be unoccupied. The purpose of the empty dwelling management order is to deal with properties that have been unoccupied for some considerable time. Therefore, the residential property tribunal needs to investigate carefully the reasons why that situation has come about before an order is made authorising the making of an order. That is the reason for Amendment No. 129. I beg to move.

Lord Rooker

My Lords, in thinking about this I constantly go back to examples in my former constituency of frustration in relation to houses which were left empty. An ordinary suburban, tree-lined street, with two or three-bedroomed semis built in the 1920s and 1930s —nice houses, but with one stuck in the middle of a very long road. It was a nightmare. If we had had this kind of legislation then, my constituents would not have been asking why it was empty; they would have said, "Get something done about it".

The point I am making is that, by the time we get to the stage where the property has been vacant for such a long time, where there has been community interest, councillor interest, and so on, why it is empty is unimportant. If it fulfils the criteria, what is important is how it can be reoccupied. That is the purpose of the exercise.

I accept that there may be all kinds of reasons, some of which may be very sad. I understand the sorts of things which could cause a property to be left empty and I do not dismiss them: far from it. However, at this point it is a question of whether the relevant proprietor has a plan to secure reoccupation. If so, all well and good and no order would be required. If there is no such plan and no co-operation with the local authority, then I think that the local authority is quite right to seek such an order. It is not expropriation; it is certainly not confiscation. It is in order to get the dwelling used. It is a house or home for someone, but it is not just that: it is the rest of the community. We are dealing with individual dwellings, but the neighbours of such dwellings, whose own homes may have been blighted for all sorts of reasons, also have to be considered.

We think that the amendment is probably unnecessary in any event, simply because the tribunal will be required to consider the effect the order would have on the relevant proprietor's rights. This is sufficiently wide to enable the tribunal to consider any representations made. If the proprietor opposes the order, and part of the reason for opposition is a link to why it is empty, clearly the tribunal will be able to listen to that. If there is a really good reason, that is fine. That is what the tribunal is there for. It is not for us to second-guess that.

If there is a good reason, we would not want adversely to affect anyone's rights by an order being made; but the reasons why the dwelling is empty is not the key relevant issue that the tribunal will have to consider.

Baroness Hanham

My Lords, I do not think that we are suggesting that it is the key consideration. It is clearly a consideration.

Subsection (2) of Clause 129 states: The matters as to which the tribunal must be satisfied are…(b) that the relevant proprietor of the dwelling does not intend to take immediate steps to secure that the dwelling becomes occupied". Part of the reason for doing that would he to find out why it was unoccupied. That is not spelt out. The reason why the dwelling has been unoccupied could be spelt out in subsection (3)(c). It is the history of what has led to this.

I accept the Minister's point of view and I, like him, have seen properties in some areas that have caused great distress. Equally, however, somebody has the rights of ownership of that property, and they certainly have a right to indicate why it has been left empty.

I am not sure that subsection (2)(b) fulfils that role. By strengthening it with this amendment, I should have thought that it would make it clear that such representation could be made.

I hear what the Minister says. I may want to return to this at a later stage but, for today, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Hanham moved Amendment No. 130:

Page 94, line 36, at end insert— (d) the extent and cost of any works which will be required to render the dwelling suitable for occupation.

The noble Baroness said: My Lords, to bring the property back into a liveable condition—indeed, probably better than a liveable condition—very extensive work may be required to make the property suitable for occupation. Considerable cost may consequently be involved and that could be excessive. It should be something at which the residential property tribunal is expressly required to look before authorising the making of an interim order.

It must be borne in mind that the owner of the property will ultimately have to meet the cost because they will not receive any rent until the local authority has recovered the cost of any such works. In an earlier amendment we were trying reach this point by suggesting that the local authority had to seek the best possible rent. The owner may wish to make representations regarding the extent and cost of any work—and the viability of doing that work, if it will be too expensive. I beg to move.

8.45 p.m.

Lord Rooker

My Lords, I fully accept the points made by the noble Baroness, but the amendment is not necessary for reasons which, I hope, are clear. No local authority will enter into such a project where it has to bear the financial risk that it might fail to recover the costs it incurs in making a dwelling habitable. The risk is with the local authority. I remind the noble Baroness—if the local authority fails to recover its costs, it returns the property to the relevant proprietor in a refurbished state and is unable to recover any of the outstanding costs. There is a big difference between interim management orders and final management orders under Chapter 1 of Part 4, and empty dwelling management orders.

Local authorities can be required to step in and make IMOs and FMOs when private rented properties suffer a collapse in management. But they choose to step in to make EDMOs. It is only right that they bear the risk if they decide to do that. On a practical level, it would also be fairly difficult for the property tribunal to make a judgment on matters of this sort because it could add hugely to the bureaucracy of hearings. The local authority has to bear the risk and so has to think about the matter before it proceeds with the order.

Baroness Hanham

My Lords, I thank the Minister for that reply. It settles the matter and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Hanham moved Amendment No. 131:

Page 94, line 36, at end insert— (e) any disadvantage to the relevant person or third party in relation to any other premises adjoining or in the neighbourhood of the dwelling which may result from the making of the order.

The noble Baroness said: My Lords, one type of property which could well be the subject of an interim EDMO is a flat above a shop. As we have discussed in previous legislation, many of these are left empty for a number of reasons—one of which might be perceived problems of security. Property owners and investors often avoid letting flats above shops because of management problems which can result in them being unoccupied. Consequently, there is an increased risk of break-ins into shops. This is particularly the case if flats are then let out by local housing authorities to those who cause anti-social behaviour. It is right and proper that the residential property tribunal should look at the effect that may result on other properties close by if an interim order were to be made. I beg to move.

Lord Rooker

My Lords, I am grateful that the noble Baroness has made it clear that the amendment is concerned with the making of EDMOs in respect of flats over shops. Clause 127(4)(a)(ii) already provides that a dwelling for the purposes of EDMOs must have its own separate access. So, in the case of a flat over a shop, it must be possible to enter it other than through the shop. That is not unusual because one often sees street doors between shops giving access above. Nevertheless, that is a factor.

The amendment would effectively mean that the relevant proprietor, or someone else with an interest in the building, could block the making of an interim EDMO if they considered residential occupation of the flat would be unsuitable. We are making significant efforts to work with commercial property freeholders and retailers to persuade them to bring redundant commercial space above shops back into use. I accept that it is not easy. The Housing Corporation and English Partnerships are currently considering the scope for a new advice and delivery mechanism for vacant space above shops.

The work has the support of a number of organisations, such as the British Property Federation, which were involved in the Housing Above Shops Task Force that I commissioned when I was the Housing Minister. I pay particular tribute to the British Property Federation because, on the very day I raised the question with it in an informal way, it was very proactive and positive. It came to the department with some solutions, rather than a pile of questions, and the matter has been taken forward.

That work, however, is largely concerned with creating residential accommodation from void space that is no longer needed for commercial use. That is the key area. Where existing flats over shops are vacant, we consider that the case for securing their occupation is not in doubt, and do not see that a relevant proprietor, or anyone else, should be entitled to prevent that occupation. Of course, residential and commercial uses come into conflict. Commercial people say, "I'm running a business, I don't want to be a landlord. I don't want the hassle and all the rigmarole". This is part of the reason why a lot of these properties have lain empty; it is a real problem. We think, however, that it ought to be possible to prevent such problems arising through sensitive management and appropriate tenant selection, so we need that delivery mechanism or third party involvement.

Clause 129(3) already provides that the tribunal must take into account the effect of the order on the rights of the relevant proprietor and third parties. To that extent, the amendment is superfluous, but I do not dismiss it as irrelevant, as it raises the important issue of empty flats above shops. However, if they were used as dwellings in the past and they are just kept empty, I do not see why they should be exempted. However, we are looking at the issue more widely.

Baroness Hanham

My Lords, as leader of a council that started one of the projects on shops above commercial premises, I know exactly the problems associated with them. There are many reasons why those flats and apartments have been left empty. The Minister has drawn attention to an area in the legislation that probably covers the matters 1 have raised, and I therefore beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 132 and 133 not moved.]

Clause 130 [Local housing authority's duties once interim EDMO in force]:

Lord Hanningfield moved Amendment No. 134:

Page 95, line 35, leave out from "must" to end of line 36.

The noble Lord said: My Lords, the whole purpose of making an interim EDMO is to ensure that the property is occupied. If steps are not taken to achieve that purpose, the EDMO should be revoked altogether—there is no point in making a final EDMO and prolonging the process. This is the intent behind Amendment No. 134.

Regarding Amendment No. 135, we believe the local housing authority should also be placed under a duty to ensure that the property is secure, to prevent intruders. Additionally, the authority should take reasonable steps to minimise damage and sensible measures, such as cutting off the water to prevent pipes bursting in winter, which need to be taken by a local authority in addition to insuring the property. I beg to move.

Lord Rooker

My Lords, the noble Lord said that Amendment No. 134 relates to the local authority's duties once an interim empty dwelling management order has come into force. The amendment itself would remove the ability of the local authority to make a final empty dwelling management order if that authority concluded there were no steps it could take to secure occupation of the dwelling under an interim empty dwelling management order. Effectively, the only course of action open to the authority would be to revoke the interim order and take no further action.

The amendment fails to take into account the reasons why it might not be possible to secure occupation of the dwelling. Under an interim empty dwelling management order, a local authority cannot grant a tenancy without first obtaining the consent of the relevant proprietor. It sounds repetitious, but it is crucial that I get that point across. Where consent is not given, the only course of action open to the authority would be to revoke the interim empty dwelling management order and make a final empty dwelling management order. Under the final empty dwelling management order, the local authority would be able to grant a tenancy without the need to obtain the relevant proprietor's consent, though that is the "nuclear option". The amendment fails to take into account why securing occupation might not be possible, and therefore I ask the noble Lord not to pursue the matter. I hope I have answered him satisfactorily.

This is a complicated area—I freely admit that we are in uncharted waters. We have to be seen to be practical to make this work. In some ways, it will be down to the tribunal to assess all these conditions before the orders are made.

Lord Hanningfield

My Lords, the Minister did not speak to my other amendment about the local authority taking reasonable precautions with regard to securing the property.

Lord Rooker

My Lords, that goes without saying. The local authority is bearing the risk in going for the order in the first place. As I have said on previous amendments, it carries the risk of not being able to recover money spent on the property to make it habitable. Therefore, it will have to think about this. It does not make any sense for a local authority to start work without securing the property, whether we are talking about access to the utilities or physical access. Once the local authority does this, it carries the risk. It does not own the property but will be liable for it. Therefore, local authorities must be reasonable. Frankly, only the reasonable local authorities will go for these orders, not the weak ones. I know that there are no unreasonable local authorities, anyway—only unreasonable actions.

It goes without saying that professional people and local authorities will have to take the necessary precautions to secure the property while it is being refurbished and remains empty.

Lord Hanningfield

My Lords, I thank the Minister for his reply. As he said, this is new territory and the mechanisms are somewhat complex. We need to analyse them further before Third Reading. I accept everything that the Minister has said; obviously everything must be practical. We need to carry out more scrutiny on the process before Third Reading so that we can question it again before it becomes law. With that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 135 not moved.]

Clause 131 [Making of final EDMOs]:

Lord Hanningfield moved Amendment No. 136:

Page 96, line 20, after "rights" insert ", wishes and intentions"

The noble Lord said: My Lords, as with similar amendments in this vein, Amendment No. 136 would require an authority to consider the wishes and intentions of the relevant proprietor before it makes a final EDMO. This is very similar to the discussion we have just had. For example, the owner might indicate that he now intends to let the property and is willing to find tenants for it. The property should not then be subject to a final EDMO. I beg to move.

Lord Rooker

My Lords, this is the final limb of Amendment Nos. 121 and 128. When I spoke to Amendment No. 121, I said that the same answer applied to Amendment No. 128, and I indicated that Amendment No. 136 was also in the parcel. Amendment No. 136 has the same effect as Amendments Nos. 121 and 128. Therefore, I ask those who are looking at what we have been doing today to read what I said on Amendment No. 128, because the reasoning is exactly the same for Amendment No. 136.

Lord Hanningfield

My Lords, I thank the Minister for that answer. I accept it totally. As I said on the previous amendment, we will scrutinise the answers and look at the process to make sure that we understand it absolutely. Again, this is new territory, and we want to make certain that the legislation is sufficiently scrutinised. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Rooker moved Amendment No. 137:

Page 96, line 32, leave out paragraph (c) and insert— (c) paragraph 7(6)(a) is to be read as referring instead to Part 4 of Schedule 7;

On Question, amendment agreed to.

Lord Rooker moved Amendments Nos. 138 and 139:

Before Clause 140. insert the following new clause—