Lords Sitting of 14 September 2004

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Newcastle.

Lord George
The Right Honourable Sir Edward Alan John George, Knight, GBE, having been created Baron George, of St Tudy in the County of Cornwall, for life—Was, in his robes, introduced between the Lord Richardson of Duntisbourne and the Lord Kingsdown.
Lord Kerr of Kinlochard
Sir John Olav Kerr, Knight, GCMG, having been created Baron Kerr of Kinlochard, of Kinlochard in Perth and Kinloss, for life—Was, in his robes, introduced between the Baroness Scotland of Asthal and the Lord Williamson of Horton.

Georgia: Territorial Integrity
2.49 p.m.
Lord Wallace of Saltaire Lord Wallace of Saltaire asked Her Majesty's Government:
What steps they are taking, with their European Union partners, to support the Georgian Government's efforts to restore their territorial integrity.
The Minister of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, President Saakashvili visited the United Kingdom in July for talks with my right honourable friend the Prime Minister, who confirmed his support for the territorial integrity of Georgia and for Georgian government efforts to re-establish this by peaceful means.
An EU policy statement of August, to which we actively contributed, also restated this principle. We will continue to work closely with our EU partners on this issue.
Lord Wallace of Saltaire: My Lords, I thank the Minister for that statement. Is she aware that in the past few weeks the situation has in many ways become a great deal more delicate? We are all aware of problems in the North Caucasus, which look increasingly explosive, and of the potential overspill from the North Caucasus to the South Caucasus. We have seen reports of President Putin's suggestion that Russia is entitled to take pre-emptive action across the borders. Does the Minister think that there is merit in the proposal that international monitors from the OSCE, for example, or the EU should be invited to
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play a much more active role in patrolling and monitoring the borders of Georgia with Russia in order to ensure that allegations which are flying backwards and forwards at present about cross-border intrusion and arms smuggling are properly assessed?
Baroness Symons of Vernham Dean: My Lords, I am indeed aware of the fact that the situation has become more delicate, as the noble Lord, Lord Wallace of Saltaire, put it, and of course Russia has some very immediate concerns about the North Caucasus area. The noble Lord is right to point out that, given the geographical proximity, there are bound to be some shared interests, particularly in view of what happened recently with the terrorist outrage and the possibility that the terrorists themselves may move around between these areas.
Quite honestly, Her Majesty's Government will consider any serious, well thought-out initiative to promote dialogue and regional co-operation on security issues, including the very important issues of counter-terrorism. Whether or not having international monitors on the borders is the right thing to do at present is a matter that will be open to much dispute. We are talking about distinct problems in the North and South Caucasus, but Her Majesty's Government do not want to shut the door on anything constructive if there is a possibility of taking it forward.
Lord Biffen: My Lords, have the Government yet replied formally to the recent Russian doctrine of pre-emption?
Baroness Symons of Vernham Dean: My Lords. I think that the question of pre-emption was dealt with by my noble and learned friend the Attorney-General when he had to address these issues recently. With regard to this matter, we have said that there may well be times when pre-emption is appropriate. The position was set out by my noble and learned friend on 21 April when he said that it is the Government's view that,
"international law permits the use of force in self-defence against an imminent attack but does not authorise the use of force to mount a pre-emptive strike against a threat that is more remote. However, those rules must be applied in the context of the particular facts of each case … The concept of what constitutes an 'imminent' armed attack will develop to meet new circumstances and new threats".—[Official Report, 21/4/04; col. 370.]
Lord Avebury: My Lords, is the Minister aware that the Abkhazians broke off the negotiations in Geneva when a peaceful commercial vessel attempting to enter the port of Sukhumi was bombarded by a Georgian warship? Does she not think that a better atmosphere would be created, in which dialogue could take place between Georgia and Abkhazia, if the blockade of Abkhazia were lifted and the airports and ports of Sukhumi and the railway line between Moscow and Sukhumi were repaired and opened for international communications?
Baroness Symons of Vernham Dean: My Lords, things which facilitate international communications are very important. However, at the same time, these blockades are sometimes in place because of the fear of international terrorism. Only in the past week or so, we have seen how justified that fear has been, although obviously the incident in Beslan was in the North Caucasus and not in the South Caucasus.
The whole question of trying to get dialogue going on this issue is enormously important. However, there are three distinct conflicts in the South Caucasus: that between Georgia and Abkhazia; that between Georgia and South Ossetia; and of course the Armenia-Azerbaijan conflict over Nagorno-Karabakh. When we talk about these things altogether, it may bring the problems together in a way that allows us to talk, but it is very difficult to see what the right package of solutions would be in those circumstances.
Baroness Rawlings: My Lords, what pressure is the Prime Minister putting on President Putin to honour the 1999 OSCE commitment from the summit in Istanbul to remove Russia's military bases and troops from Georgia, as it did from East Germany and Poland?
Baroness Symons of Vernham Dean: My Lords, these matters have been discussed with our friends in Russia, as has the point about the relationship of Georgia to the two provinces in question—South Ossetia and Abkhazia. In his exchanges with the Russian President, the Prime Minister has made it very clear that we should like to see far greater dialogue. The OSCE is already one of the means for that dialogue, but that is principally a dialogue between Georgia and South Ossetia, and of course there is also a UN role in relation to Abkhazia.
Lord Hylton: My Lords, can the noble Baroness say whether at present there are any OSCE observers inside Abkhazia, and do the Government form any view on the extent of Russian support for the Abkhaz people when Russia refuses any consideration of autonomy or independence for Chechnya?
Baroness Symons of Vernham Dean: My Lords, the OSCE role is in relation to South Ossetia and not in relation to Abkhazia. It may be possible for a security position in North Ossetia to develop, but the OSCE role is specifically about Ossetia. The UN has the role in relation to Abkhazia, and a UN observer mission in Georgia was established in 1993 to verify the ceasefire agreement between Georgia and Abkhazia. It did not relate to Georgia and North Ossetia.

British Army: Regimental System
2.57 p.m.
Baroness Strange Baroness Strange asked Her Majesty's Government:
Whether they propose to phase out the regimental system in the British Army.
The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Bach): My Lords, no. We have no intention of phasing out the regimental system. The value of the regimental system is not in doubt. But it must adapt, as it has done in the past. The changes that we are making reflect the reduction in infantry battalions made possible by the changes to the Northern Ireland commitment and the decision to end the Infantry Arms Plot. I can assure the House that we will maintain famous names, regional identity and traditions wherever possible.
Baroness Strange: My Lords, I thank my noble friend the Minister for his courteous and predictably evasive reply. Does he agree—I am sure that the answer to this will be da—that we have the best armed services in the world and that the excellence of our Army is due to the splendid calibre of its officers and men and to their close affection for the family regimental system, as it is now? Is he aware—the answer to this may be nyet—that I have strong family connections with the Grenadier Guards, the Coldstream Guards, the Scots Guards, the Welsh Guards and the Black Watch and that I totally support the Scottish regimental system as it is at the moment?
Lord Bach: My Lords, I knew that I was not looking forward to answering this Question. Of course, I agree with the noble Baroness that our Armed Forces are the best in the world. I say "of course" because I think that events over many, many years, including over the past year in particular, have shown that. Of course I accept the value of the regimental system.
However, I must tell the noble Baroness that changes to the Army's infantry structure do not automatically mean that the history, traditions and contribution of famous regiments will disappear or cannot be incorporated within a new structure. It is a fact that very few of our regiments and corps exist today in exactly the same form as they did in the past. There has been a constant process of change and regeneration and that is why our Armed Forces are the best in the world. New organisations are being created in them, fostering previous military renown while developing their own traditions and reputations to engender the loyalty and camaraderie which are right at the centre of our excellence.
Lord Crickhowell: My Lords, I had the honour many years ago to serve in the Royal Welch Fusiliers, now serving in Iraq. Over the past decade at least, they have had an outstanding record of recruitment, based on roots in geography, community and culture. While welcoming what the Minister said about the importance of regional connections, does he agree that any attempt to merge regiments into so-called large regiments which do not have common links of that kind will end in a disastrous reduction in both the quality of those regiments and the recruiting record?
Lord Bach: My Lords, of course we want the new merged regiments to have links with each other; that is important. In future, those individual battalions will

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be fixed by role, and largely by location, and in any new structure the Army will seek to retain existing geographical links. We believe that that is likely to result in even greater identity between the recruiting area and the location in which people serve. I repeat, because it is important to the House in particular, that our aim is to ensure that the links are maintained wherever possible.
Lord Astor of Hever: My Lords, does the Minister agree at this time of great uncertainty in terms of national security that to cut four infantry battalions with their extensive and ever-changing commitments is an act of dangerous folly?
Lord Bach: No, my Lords; I do not agree with the noble Lord. We are restructuring the Army and the infantry in particular to increase significantly the manpower available for expeditionary operations. In that respect, the restructuring of the infantry about which the noble Lord asked is made possible by progress made towards a lasting peace in Northern Ireland. Such progress is predicated on full normalisation being secured in Northern Ireland. If that does not happen, we shall keep what we propose under review. Because of that, we have been able to reduce the number of infantry battalions in the Province by four, a move which, owing to the need to take battalions through this task, has freed up 16 battalions for use on other tasks.
The manpower freed up by that move will be redistributed across the Army, not only to develop more robust and resilient establishments in the infantry but also to bolster the most heavily specialist areas, such as logistics, engineers, signallers and intelligence. What is crucial to all of this is the phasing out of the traditional practice of arms plotting. That will further increase, we believe, as does the Army Board, the efficiency and availability of Army resources.
Lord Maginnis of Drumglass: My Lords, do the Government recognise the regional significance and necessity of ensuring that at least one regiment of the line is maintained in each constituent area of the United Kingdom?
Lord Bach: My Lords, we know very well our obligations and the necessities around the whole of the United Kingdom. As I say, because of progress in Northern Ireland, it has been the considered view that four battalions that are presently serving there do not need to remain there.
Lord Garden: My Lords, I welcome very much the Government's moves towards getting rid of arms plotting and the inflexibility and inefficiencies associated with it. But, having said that, for all the reasons given by other noble Lords, we are uncertain, and I should like to know the Minister's view. Is he certain about the effect on recruitment and retention at a time when our forces are employed in Iraq,
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Afghanistan, the Balkans and Africa? Should we not just keep infantry numbers static, even if we reorganise, until we see how things work out?
Lord Bach: My Lords, I think that I have already answered that point. I am grateful to the noble Lord for his support for the abolition of arms plotting. He, with his experience, will know that it has served its purpose. We believe that there will be great benefits in having battalions based in one location rather than having to move around, as they do regularly. That in itself, in time, will help recruitment. Of course, we are carefully monitoring recruitment at present. The record has been much improved in the past few years, perhaps because of the amount of activity. However, the noble Lord is quite right; we have to watch carefully and ensure that any new measures we implement do not affect recruitment. We think that this measure will improve it.
Lord Morris of Aberavon: My Lords, I make the same declaration as the noble Lord, Lord Crickhowell. Does the Minister accept that regimental loyalty, particularly if based on areas, once lost is not easily replaced? Will he be more precise as regards what he proposes to do? If these regiments mean anything, will not such a change lead to a dilution of regimental tradition, loyalty and ties, and possibly affect recruitment?
Lord Bach: My Lords, we do not believe that it will. As I have explained, and as the noble and learned Lord knows well, changes in this system have occurred for many, many years. Since 1958, 54 infantry and 23 cavalry regiments have been the subject of amalgamation, 35 of which occurred after the Options for Change review in 1992. As I understand it, all those succeeded satisfactorily. We shall watch with great care to ensure that the changes we propose do not in any way dilute the regimental system.

Mental Health: Ethnic Communities
3.6 p.m.
Lord Chan Lord Chan asked Her Majesty's Government:
What progress has been made in the past 12 months to implement the recommendations of the Department of Health report on mental health in ethnic communities.
The Parliamentary Under-Secretary of State, Department of Health (Lord Warner): My Lords, progress is being made through major reform of and investment in mental health services for black and minority ethnic communities, although much still needs to be done.
In partnership with leading national experts, sustainable change is being introduced. Among initiatives being put in place are 80 community engagement projects, 500 community development

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workers, a programme of education and training in cultural competence for frontline staff and a national census project on race and ethnicity in mental health.
Lord Chan: My Lords, I thank the Minister for his reply. While accepting the progress made in partnership working with some minority ethnic groups, including the Irish, does he agree that the amount of work done to improve mental health services to make them relevant to the needs of ethnic minority people has been quite small?
Is the Minister aware of the results of the 13 community surveys on ethnic mental health conducted in the first quarter of last year involving more than 500 participants, in which I declare an interest as a participant? What is the Government's response to the survey's findings that nine in 10 felt that service access was problematic and half of the 110 service users, patients, had experienced racial discrimination in mental health services? Should more be done to ensure that the mental health workforce has the appropriate management skills because compulsory treatment will be proposed in the new mental health Bill?
Lord Warner: My Lords, I did not mean to imply that we are satisfied with the progress that has been made. However, I did mean to imply that progress was being made. I accept the noble Lord's point that more needs to be done. We are aware of the information and surveys to which the noble Lord referred. Certainly, I pay tribute to the work done by the noble Lord in keeping this important issue at the forefront of the Government's and the public's attention.
To give one example, we are developing 10 pilot community engagement projects that have been identified across England reflecting the needs and concerns of a wide range of black and minority ethnic groups. That is why we are trying to put in place the kinds of services the noble Lord rightly says that we need.
Lord Clement-Jones: My Lords, Professor Sashidharan's report, Inside Out, was very important. The Government responded to it by setting out targets that they wanted to adopt. In particular, in view of the emphasis placed on community development by Inside Out, they pledged to recruit 500 community development workers by 2006. What progress are the Government making on that?
Lord Warner: My Lords, extremely good progress, and we expect to meet our target.
The Earl of Listowel: My Lords, is the Minister aware that children from ethnic minority groups account for nearly one in five children in public care, but just one in 10 of the general population; and that one in three Afro-Caribbean boys is likely to spend more than five years in care as opposed to one in 10 white children? In the light of that, how is he promoting closer partnerships between foster carers,
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children's homes and child and adolescent mental health services, to prevent these children developing mental ill health when they grow up?
Lord Warner: My Lords, I am only too well aware from personal experience both as a former director of social services and as a government Minister of the points the noble Lord makes. The Government are producing a National Service Framework for Children which will include provisions on improving child and adolescent mental health services. The House will not have to wait for very long; indeed, this document will be produced very shortly.
Earl Howe: My Lords, the Minister will know of the finding by the Healthcare Commission in July that black and ethnic people are being let down by mental health services in the NHS. I wonder whether he shares my suspicion from that finding that, for all the extra resources going into the NHS and all the reorganisation that the Government have brought about, the new money is simply not finding its way to where the healthcare is most needed.
Lord Warner: My Lords, there is always a difficult balance to be struck in running an organisation as large as the NHS. Many Members of this House will know that we are shifting the balance of power much more to local decision-making. However, we are confident that the money is reaching the parts that it ought to reach and we are seeing improvements. Improvement may not be coming as fast as we would like, but it will be for the Healthcare Commission, when it completes next year's assessment of the NHS, to tell us whether that is right. In the new national standards published in July, the Government made it very clear, in core standards 7 and 8, that we must challenge discrimination in the provision of health services and promote equality and respect for human rights. We expect those services to respect the needs of all the people in our communities.
Baroness Masham of Ilton: My Lords, does the Minister agree that there is a high percentage of black and ethnic prisoners in our prisons? He will be aware of the welcome National Health Service input in prisons nowadays. Do medication and health records move with prisoner patients with mental problems from prison to prison and go out with them into the community where there can be serious mental health problems?
Lord Warner: My Lords, the Government have done a great deal to improve the prison health service and have brought in arrangements so that the NHS plays a bigger role in the healthcare services provided to prisoners. It is important that those records move with the prisoner. As far as I am aware they follow the prisoner in the way that the noble Baroness said, but I shall check and write to her.

Grenada
3.13 p.m.
Baroness Falkner of Margravine Baroness Falkner of Margravine asked Her Majesty's Government:
What efforts are being made to assist the people of Grenada following the recent hurricane in the area.
The Lord President of the Council (Baroness Amos): My Lords, a significant regional and international relief effort began as soon as possible following the impact of Hurricane Ivan to the island of Grenada. At the forefront of the immediate response was HMS "Richmond", supported by R FA "Wave Rider" pre-positioned in the area to provide early assistance. This included re-establishing the island's emergency operations centre, restoring power and providing medical support to the general hospital.
Baroness Falkner of Margravine: My Lords, I thank the Leader of the House for that Answer. Does she agree that an urgent and necessary impact assessment needs to be carried out on the needs of the people of Grenada, and that timely and generous assistance is due to them? Does she also agree that, in the longer term, HMG needs to work with Commonwealth partners to provide the Commonwealth countries in the Caribbean with longer-term technical assistance in terms of hurricane resistant buildings and public buildings infrastructure so that we can minimise future loss of life?
Baroness Amos: My Lords, before I address the noble Baroness's question, perhaps I may express my sadness at the loss of life in Grenada and in other parts of the Caribbean and offer the support of the House to the people of the Caribbean in trying to reconstruct their lives. I also give a particular mention to my noble friend Lady Howells, who has very strong family ties with Grenada.
I agree with the noble Baroness that there is a need for an urgent and necessary impact assessment. That is already being carried out by the World Bank and by the International Committee of the Red Cross. An assistance programme will be put together, which we will of course support.
I also agree that Commonwealth partners need to work together. In this area the Commonwealth Secretariat is well able to give technical assistance.
Lord Walton of Detchant: My Lords, I must declare an interest. Until last year I was chairman of the UK friends of St George's University on the island of Grenada and made annual visits to the medical school. Is the noble Baroness able to tell us what effect this hurricane has had on the teaching and clinical programmes of the medical and veterinary schools in Grenada and to what extent the UK Government will offer support to the work of that university?
Baroness Amos: My Lords, it is too soon to say what the longer-term impacts might be. In terms of the current situation, the hospital is up and running. The immediate problem is with respect to shelter. Some 60,000 Grenadians lost their homes and that is the immediate priority for the Government of Grenada.
Baroness Howells of St Davids: My Lords, I begin by saying that I was able to get through to Grenada at one o'clock today. I was told that one cannot imagine the devastation in Grenada—90 per cent of the houses are down. There are problems with elderly people going into shock. I should like very much to thank the Minister for the very quick way in which the Government responded to Hurricane Ivan's terrible devastation of Grenada. We appreciate the promptness, but we are more concerned about the long-term strategies that will be put in place for the welfare of Grenada. The nutmegs, cocoa and tourism have gone. The people of Grenada are without water and few have any food left because there is still no power. I should very much like to hear from the Minister on the long-term strategy for Grenada.
Baroness Amos: My Lords, perhaps I may first say that I am very pleased that my noble friend was able to finally get through to Grenada. On the long-term strategy, we have to wait for the needs assessment. We have been told by the International Committee of the Red Cross that it expects to conduct its assessment within the next week. The World Bank assessment may take slightly longer. My noble friend may be aware that we intend to work through the Caribbean Development Bank, the World Bank and the International Monetary Fund, which all have concessional lending facilities available for countries recovering from such disasters.
My noble friend is quite right: islands like Grenada were just recovering from the difficulties they experienced post-11 September and we must do all we can to support them in terms of their longer-term recovery.
Baroness Masham of Ilton: My Lords, I have visited Grenada, which is a beautiful spice island. Is this not a wonderful opportunity to organise volunteers to go and help with the vegetation in the long term?
Baroness Amos: My Lords, in the longer term it may well be possible to organise groups of volunteers in particular areas. Given the current scale of devastation in Grenada, the immediate need is for those who are expert in humanitarian relief.

Procedure of the House: Select Committee
3.19 p.m.
The Chairman of Committees (Lord Brabazon of Tara): My Lords, I beg to move the first Motion standing in my name on the Order Paper.
Moved, That the Viscount Bledisloe be appointed a member of the Select Committee in the place of the Lord Chalfont.—(The Chairman of Committees.)
On Question, Motion agreed to.

Mental Health: Select Committee
The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That the Lord Mayhew of Twysden be appointed a member of the Select Committee in the place of the Baroness Fookes.—(The Chairman of Committees.)
On Question, Motion agreed to.

Horserace Betting and Olympic Lottery Bill
3.20 p.m.
Read a third time.
Lord Moynihan Lord Moynihan moved Amendment No. 1:
After Clause 5, insert the following new clause—
"SALE OF THE SUCCESSOR COMPANY TO THE RACING TRUST
Any sale of the successor company to a body other than the Racing Trust shall not take place unless the sale has been approved by a resolution of each House of Parliament."
The noble Lord said: My Lords, there are many friends of racing in this House who are only too well aware of the valuable contribution that the Tote makes to horseracing at every racecourse throughout the country. It is vital that that support—some £10 million each year—is safeguarded.
However, notwithstanding the Tote's long and noble tradition of supporting racing, we on these Benches agree that the time has come to modernise its structures, thus enabling it to compete more effectively in the market place. I pay tribute to the work of my noble friend Lord Astor who introduced a Private Member's Bill which sought to achieve that very goal in 2000.
It is for those reasons that we fully support the Government's stated intention that the Tote should be sold to the Racing Trust. Such a sale secures our twin aims of safeguarding the Tote's multi-million pound annual contribution to racing while also allowing it to compete commercially.
Yet there is a cloud on the horizon. Noble Lords may have read about rumours that the Treasury feels that it could perhaps raise more money if the Tote was sold to venture capital firms and is therefore having
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second thoughts about a sale to the Racing Trust. For example, I refer noble Lords to the article in the business section of the Observer on 1 August this year, which states:
"Betting industry sources say senior Labour politicians now believe it would be beneficial for the racing industry to receive a huge, one-off cash windfall rather than keep the pooled betting business for the length of a new seven-year licence".
While I would not normally pay much attention to such rumours, nor indeed do I believe all that I read in the papers, the indicative amendment introduced and then withdrawn by the Government on Report supported that view in the event that a sale to the Racing Trust was withdrawn and abandoned.
Throughout these proceedings, the Government have steadfastly refused to put their intention to sell the Tote to the Racing Trust on the face of the Bill, despite an explicit manifesto commitment. Indeed, the Minister has been very careful with his words and has failed to give any guarantees about the purchaser of the Tote.
Let us be very clear: the Bill before us today gives Ministers carte blanche over the Tote. All it actually does is nationalise the Tote at zero cost to the Exchequer. The Government would then be free to sell the Tote to whomever they wanted, whenever they wanted and at whatever price they wanted. There is nothing in the Bill to stop the Treasury nationalising the Tote and subsequently selling it to the highest bidder, thereby jeopardising the Tote's contribution to racing.
Our amendment is designed to act as a check on the Government and to help them ensure that they honour their 2001 manifesto commitment to,
"sell the Tote to a racing trust to allow it to compete commercially, with all long-term profits invested in the sport".
Our amendment is not designed to be complicated or contentious.
We on these Benches have supported Part 1 of the Bill solely on the basis of a sale to the Racing Trust. If that is not possible—and given that there may be good reasons why such a sale is not possible—we believe that it is incumbent on the Government to return to Parliament to seek its approval to sell the Tote to another bidder.
Noble Lords may be aware that the sale of the Tote to racing is the subject of ongoing discussions between the European Commission and the Department for Culture, Media and Sport. I am grateful for the Minister's letter dated 20 August confirming that the Commission had a number of queries about the Government's proposals. Although the Minister was unable to provide any details on the nature of those discussions in his letter, it would be helpful to learn today if an agreement has been reached, at least in principle, with the Commission.
I am confident that many noble Lords would share my frustration if the sale of the Tote to the Racing Trust were undermined by an adverse state-aid ruling from Brussels. When we last discussed the sale of the Tote at Report stage, the Minister was told—I hope in no uncertain terms—that unless all the preparatory

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work had been done to reach an agreement in principle with the Racing Trust, Her Majesty's Opposition could not support Part 1 of the Bill as it stood. Unfortunately, that has yet to happen.
The Minister kindly sent a letter on 12 August to say that while government accounting rules permit planning and preparatory work to be undertaken prior to Royal Assent, the department took the view that it could,
"not carry out any detailed negotiations on price or of sale terms, nor start preparation of the Sale and Purchase Agreement".
The letter goes on to say, in the finest Civil Service jargon:
"I sincerely hope that we will be able to reach a position by 14 September where all parties can be confident that the balance of probability is firmly tilted towards the likelihood of concluding a successful sale of the Tote to Racing".
As noble Lords may appreciate, we on these Benches need something more concrete than,
"the balance of probability [being] tilted towards the likelihood"
of a sale to the Racing Trust. It is not even clear that the Government have managed to achieve that at the moment. My understanding of the situation is that it remains fluid and far from certain as to whether the Tote will be offered to the Racing Trust at a price that it can afford.
Certainty and clarity on this Labour Party manifesto commitment are required on the face of Part 1 of this legislation today. Certainty and clarity are required in the form of a clear indication that the Government intend to sell to the Racing Trust. We on these Benches believe that there is still far too much uncertainty over the Government's policy to sell the Tote to the Racing Trust. As such, we are unable to support the Bill without the required safeguard contained within my amendment.
I should reiterate that this is not a controversial amendment. The wording and intent have evolved throughout the passage of the Bill to include the concerns of noble Lords and the Minister—indeed, noble Lords from all sides of the House. The principle of the amendment supports the Government's stated policy to sell the Tote to the Racing Trust. Further to that, it secures a vital safeguard to the Bill in the event that a sale to the Racing Trust is not possible. There are precedents for such a safeguard and it would do nothing but strengthen the Bill before us today. I beg to move.
Viscount Falkland: My Lords, we on these Benches understand that the transfer of the Tote from whatever it was—through the nationalisation process to the private sector—is a complex and unusual matter. It is very necessary. The reasons for it being in the Labour Party manifesto are well understood. It is long overdue that the Tote should be out of the purlieus of government in the way that it has been. The Government and those who have run the Tote have served the interests of all those involved—the punters and racing—very well.
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I absolutely understand the thinking behind the amendment tabled by the noble Lord, Lord Moynihan. In Committee, I again agreed with much of what he said. Time has now moved on. The programme has not exactly kept to that which was foreseen. We are at a disadvantage in your Lordships' House today because we have had the Summer Recess. Negotiations have taken place in terms of finding the proper consideration that would be paid by the Racing Trust if this deal is the deal that finally moves the Tote into the private sector. We understand—all noble Lords will understand—that the Treasury has a public service remit. It deals with public funds and will need to take careful note of the value of what is being sold or transferred and not give any favours to anyone in so doing other than to the nation that it serves. I put that in more clumsy words than the Minister did when we discussed the issue.
3.30 p.m.
There is a difference between the noble Lord, Lord Moynihan, and the Minister, who explained carefully and clearly to us the difficulties that he was in by giving the undertaking required of him: should the deal fall through it would return to the starting blocks—if I may use that sporting analogy. We would not want to rehearse the reasons he gave now.
A deal of trust in the Minister is required by all interested parties. I am sure that he and those connected with the matter are sincere that the benefit should go to racing. That is what we all have been aiming at. I am sure that the best efforts have been made during the past weeks to make sure that the negotiations have gone in that direction. I hope that the Minister will be able to tell us, while we are deciding how we are to react to the amendment in the name of the noble Lord, Lord Moynihan, that things have moved forward apace and that the intention is to do what the Minister said that the Government intended to do. We are somewhat behind at this stage because the matter is complicated.
Perhaps the Minister can tell us how far apart the Treasury and the special advisers to the Racing Trust are. I imagine that there is a gap in terms of the appropriate consideration. There are all kinds of matters about which we know very little. All we know is that there has been a general expression of good will towards the trust. The noble Lord, Lord Lipsey, has been at great pains to explain to us both in your Lordships' House and privately how things are going. I know that he has had a difficult time, but I think that he is probably more optimistic now than he was some weeks ago. Perhaps he will rise to his feet to tell us something of that in a moment.
This is an extraordinary affair. We are dealing ultimately with public funds which are not to be sneezed at. People to whom I have talked both inside and outside racing tell me that the value on the open market would be in the nature—including the betting shops and the Tote pool operation—of not much less than £350 million. The noble Lord, Lord Moynihan, says that there is a rumour that there are those who

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would prefer that we got shot of all this and sold it to the highest bidder and let racing take its slice now, whatever that may be.
I have discussed the matter with the noble Lord, Lord Lipsey, and others, and he will probably be able to argue in the House today that that road would ultimately be unsatisfactory for racing and that the road of going to the Racing Trust, if the consideration can be agreed on, will be much more beneficial to racing in the short, medium and long term.
I assume that the Minister will tell us that he and his department are using their best endeavours to get the agreement between the special advisers and the Treasury settled in the near future so that it can go ahead. However, a number of minor issues need to be addressed. Although I have worked in business circles and in the City, I am not aware of what is appropriate in all the aspects of such a deal.
I hope that I am not treading on any toes, but for example, when we went to the annual general meeting of the Tote, the admirable chairman of the Tote, Mr Peter Jones, expressed the hope—it is on public record—that 5 per cent of the agreed price would be shared among the staff of the Tote. I found that an interesting concept, and perhaps that is normal among transfers of this magnitude. When I think about it, however, I do not know whether it is appropriate for a transfer of this kind. One has to say that in the climate in which City operations are now viewed by both the public and the press, a little clarification on the matter is needed.
I do not know whether the Minister will be able to say anything on that matter. I cannot think that the chairman of the Tote produced that figure in public without it having some authority. Noble Lords might be interested to know what exactly that means if we are going to sell something for £350 million with 5 per cent going to the staff. Does it embrace the directors of the company and all the staff down to the doorkeeper, the chauffeur and so on? Does the Minister recognise that? Is that figure normal in such transfers? If so, is it appropriate in this case?
It is one of the points that we need to know about. Your Lordships' House might be a good place for the air to be cleared on the matter. It might be an extremely good idea. The Tote is an admirable organisation that has served us well. The staff obviously deserve recognition, whether they be directors or just lowly members of that operation. It would be interesting to hear from the Minister what would be appropriate in this case.
Without saying anything about voting to the noble Lord, Lord Moynihan, if he intends to go through the Lobbies, we would prefer at this stage to trust the Minister—if he says what I hope he is going to say and we are reassured by the noble Lord, Lord Lipsey, that we do not have to follow the noble Lord into the Lobbies.
I hope that the rumour about the idea that it may be better to sell the Tote to the highest bidder—without going through the complications of the Racing
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Trust—can be scuppered in your Lordships' House this afternoon so that we can all retain our seats and not go into the Lobbies. I imagine that the noble Lord will not be pressing his amendment. I look forward to the speeches that follow.
Lord Lipsey: My Lords, I am most grateful to the noble Viscount, Lord Falkland, for his kind and supportive remarks and his supportive behaviour throughout this legislation. During August we went in very great detail through the relevant benefits to racing of an open market sale and a sale to racing. I do not want to go into the figures for obvious reasons, but I can confirm that on any conceivable scenario it is far better for racing to buy the Tote than it is for an open market sale to take place and half the proceeds to be given to racing. I give the House that assurance. I went into the matter with an open mind, but I now have a closed mind on the basis of the detailed paperwork that we have done.
I must remind the House that I am chairman of the shadow Racing Trust, the precursor body of the Racing Trust to which the Government plan to sell the Tote. I have taken advice from the House authorities which confirms that that interest does not disqualify me from taking full part in the proceedings on the Bill. Therefore I will give the House my best advice on the position as it stands. I am afraid that that will take rather longer than I would like because of the complexity.
As will be clear from my speech, I hope that there are not any votes this afternoon. Should a vote take place, your Lordships will understand that in view of my rather sensitive position I shall not go into the Lobbies on either side.
Through the proceedings of the Bill there has been a standoff about the proposed new clause standing in the names of the noble Lords, Lord Moynihan and Lord Luke, and myself. We supporters have said that it is desirable that, were the Government to decide to abandon their manifesto pledge to sell the Tote to a racing trust and instead decide to flog it off to the highest bidder—I do not think there is much probability of that—they should first put that policy to both Houses of Parliament for approval. Ministers have put forward a number of arguments why they do not want to do so, most notably because they think that if they were to they would be negotiating with the trust with a pistol held to their heads. That was the position in July—stand-off.
When last the House debated the matter we decided to proceed as follows. Discussions would take place over the summer. As the noble Lord, Lord McIntosh, explained, there could not be negotiations because government expenditure conventions prevent full-scale negotiations taking place until after a Bill has received Royal Assent, but there would be discussions about the valuation bases and so on which are the necessary prelude to negotiations. The Government agreed that they would talk only to the Racing Trust. The hope was that by the time we got to Third Reading

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today it would be so obvious that we were within spitting distance of a deal that the amendment was redundant.
Those discussions have been taking place between the Government's appointed valuers, PWC, and the Racing Trust's, Rothschilds. They have been up and down. This time last week I would have had to say to the House that they were more down than up. It had seemed to our advisers that PWC had been taking a very aggressive attitude towards the valuation of the Tote. I can give many examples, but one will suffice.
According to the PWC valuation model, the Tote will be making more money out of its pool betting after seven years—which is when its exclusive licence will elapse—than it is now. If we believed that assumption, we would say, "Get rid of the exclusive licence now". We would not have gone through the long process of fighting to keep the exclusive licence for seven years. That is but one example of a very large number where it seemed to us that PWC were being aggressive about valuation.
However, over the past week discussions have taken a turn for the better. There still is a gap—a not insubstantial gap—between PWC and Rothschilds, but it seems to be narrower than had been feared. It begins to look—all possible fingers crossed—that if the process continues it might be that a price will emerge which is acceptable and affordable to racing. I, anyway, am optimistic.
Where does that leave the amendment? I still believe that the arguments that have caused racing to push amendments along this line all summer are correct. I do not give much credence to Ministers' counter arguments. They argue that they have a pistol to their heads. Is that right? If the Racing Trust offered a ludicrously small amount or could not finance a deal and it fell apart, Ministers would come back to both Houses of Parliament and say, "We cannot do a deal with the Racing Trust". They have a majority of 160-odd down the Corridor—not much bother—and normally this House does not seek to overrule the Commons. They would have to put their case to both Houses and, to be honest, I think they would carry it; they generally do. If their reasons were bad they would not deserve to carry it. So I do not find their arguments very convincing.
Unfortunately, although I have argued the case at length with Ministers, they do not seem to agree with me. They seem determined to resist the amendment, and they will.
So it is right that the House balances the argument for the amendment with the cost of pursuing it today. First, if the amendment is carried, the Bill will have to go back to the Commons, and I am quite sure that the Commons will send it back to us. It will not go there until after the conference season opens, and this will in turn delay Royal Assent. We are on a very tight timetable if we are to achieve the target date of completing the Bill by the end of the year. Further delays at this stage would be very undesirable.
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And to what effect? Let us suppose the Commons overturn an amendment of this House and the Bill comes back here. We would then face a difficult choice. We can either do what we usually do—huff and puff a bit and then agree with the Commons—in which case we have not achieved much for the extra delay; or we can stand firm and risk the loss of the whole Bill.
I am aware that there is a question mark hanging over the whole legislative programme at the moment—namely, the Hunting Bill and the possible loss of Bills as a result of the Government's decision to go ahead with that Bill. I shall not give my views on that decision on this occasion. The thought of losing the Bill in the brouhaha over hunting is appalling.
Even without the safeguard proposed in the amendment—to which, after all, I have put my name, so I think it makes some sense—there are very strong safeguards that stop Ministers making up their mind to go off and flog the Tote to the highest bidder. Their word is one. It could hardly have been put more strongly by the Minister in another place, Mr Caborn, and my noble friend the Minister here.
To do that they would have to welsh on a clear and unambiguous manifesto pledge. It has happened, but I do not think that it would happen readily again. They would have to eat their repeated words. They would attract the ferocious wrath of the Transport and General Workers Union, which represents the workers at the Tote—and in view of the discussions at Brighton this week I am not entirely sure that they would want that. And there would be some people—even in new Labour—who do not think that the first priority of the Government is handing the Tote over cheap to City fat cats.
Racing's friends in both Houses of Parliament would be aghast. The same people that the Government are slapping in the face with the Hunting Bill would feel slapped again by such treachery to another country sport—racing. We would then go into the general election as the party that had strengthened the hold over the country's punters of the big three bookmakers—Hill, Ladbrokes and Coral—who would end up owning it. I am only an amateur politician, but if I was a professional politician down the end of the Corridor I would not fancy doing that at all.
So, even without the amendment to the Bill—as I say, I hope Ministers will accept it—it is profoundly unattractive for the Government to go down any alternative route.
3.45 p.m.
It is, of course, a matter for the noble Lord, Lord Moynihan, whether he decides, in the light of these conflicting considerations, to press his amendment. However, if I were in his shoes—and knowing what a robust, steadfast supporter of a sale to racing he has been throughout, and I pay tribute and thank him for that—I would want first to listen closely to the Minister's reply today. I hope he will say that he will accept the amendment, but failing that, let us hear what he has to say.

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Will the Minister repeat in no uncertain terms that the Government's clear policy and intention is to sell to a racing trust and none other? Will he confirm that valuation discussions are continuing, will continue for some time and can be expected to narrow the gap between the PWC valuation and Rothschilds? Will he confirm that the striking of a valuation is not the end of the story but the first chapter only; that there will then have to be discussions between Ministers and the trust, which I have the honour of chairing, that take into account inter alia the Government's explicit political commitment and racing's capacity to finance a deal, as well as factors such as Brussels state aid considerations?
The onus is with the Minister. He has a task on his hands to persuade the House that the Government still are determined to fulfil their manifesto commitment and that, having willed that end, they are willing to embrace the means to the end through a flexibility in negotiations. If he can do so, then, perhaps with a slightly sad sigh, we should be prepared to wave a fond farewell to the new clause, which has helped to concentrate Ministers' minds during the summer process quite considerably. If not, then the House must vote accordingly.
Lord Molyneaux of Killead: My Lords, I shall be very brief. I wish to express my concern over some of the limitations in the scope of the amendment, particularly in regard to public funds. The House will not be surprised if I refer to the situation as it will affect Northern Ireland.
Northern Ireland is excluded from the British Horseracing Board's Owners Premium Scheme because of an utterly outdated agreement made when there was no horse-breeding industry in Northern Ireland to speak of. For the purposes of this scheme, the BHB recognises that Northern Ireland is an "international jurisdiction" as opposed to a part of the United Kingdom.
When the previous legislation was introduced, Northern Ireland was excluded from it. With new legislation imminent, including the abolition of the Levy Board and the transfer of its role to the British Horseracing Board, it is now imperative that, as Northern Ireland and its citizens are under the jurisdiction of Great Britain and Northern Ireland—not a new phrase—the racing industry and the people who work with it in Northern Ireland are allowed to enjoy the same benefits as the rest of the United Kingdom.
Baroness Noakes: My Lords, I declare two interests, first, as a member of the shadow Racing Trust, chaired by the noble Lord, Lord Lipsey; and, secondly, as a horse owner with a strong interest in horse racing, which is intended to benefit if the sale of the Tote to the Racing Trust takes place. I therefore have a strong interest in seeing the Bill passed and it resulting in the sale of the Tote to the Racing Trust.
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We should not forget the background to the Bill, which is that the ownership of the Tote is entirely ambiguous. Having started and built up the Tote, and never having had a penny piece of government financing, racing believes strongly that it owns the Tote and should be given it. Nevertheless, out of pragmatism, racing has accepted that it is right to enter negotiations with the Government for the transfer formulae of ownership to the Racing Trust. That requires a Bill to create the Government's ownership and the Racing Trust, thereby allowing the Government to sell it. Therein, of course, lies the problem. Having created unambiguous government ownership, the Bill leaves us in mid-air, because the Government can sell to whomever they wish.
Clearly, racing has been grateful for the manifesto commitment, but the time is fast approaching when we shall need to see that commitment become reality and that is where the problems start. While I completely accept that the Government still intend, and would like, to transfer the Tote to the Racing Trust, it is by no means clear that that will happen. Good intentions can be ambushed by all kinds of things. Difficulties could well emerge in the sale process, which has not gone very far for various reasons. For example, Europe could cause unanticipated problems. We do not know that at the moment.
The Treasury could cause problems on price. We should not discount that. It is all very well for non-Treasury Ministers to say that it is not a problem, but the Treasury will believe that it has the final say on the price. Both sides have already appointed sets of advisors. I have been involved in many commercial situations where advisors drive deals away from completion, because of the way in which they behave and the kind of issues that they expose. And, of course, the deal could fall apart because of the folly, pigheadedness or whatever of any one of the parties to it. So it is by no means clear that, the Bill having been passed unamended, the sale to the Racing Trust would take place.
However, it is possible to think about the balance of probability. We can hear optimistic statements such as that of the noble Lord, Lord Lipsey, but there is no certainty in that. From the perspective of racing, how much certainty is it reasonable for it to have about the inevitability of the transfer of the Tote to the Racing Trust? That is the issue before us.
Is timing important? Clearly, sooner rather than later, would be racing's view. However, if there was a choice between losing the impossibility of the Tote being transferred outside racing in any circumstances and a little delay, I think that I could cope with a little delay. It would not be ideal, but that would be better overall for racing than losing the Tote because of inadequate protection having been built into the Bill.
I was sorry to hear the noble Lord, Lord Lipsey, say that because of his special circumstances, which I do not quite understand, he would not be able to support the amendment to which he has put his name. I was disappointed to hear him, as chair of the shadow trust, say that. Those who have put so much time and effort

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into the transfer of the Tote to the Racing Trust would want to see much greater certainty and that has been argued for throughout. Like all other noble Lords, I shall listen carefully to what the Minister says, but I have to say on behalf of racing, for which I believe I speak, that we will need clear assurances before we are satisfied that the Bill, unamended, is a satisfactory foundation for the transfer of the Tote to the Racing Trust.
Lord Donoughue: My Lords, I do not have an institutional interest to declare, but I declare a strong interest in racing. I broadly sympathise with the points that were made by the noble Viscount, Lord Falkland. He raised an interesting point about the proposal to share 5 per cent of the sale price of the Tote among its staff. I do not know what the position on that is, but if it represents £10 million, £20 million or £30 million of public money, we need clarification.
I have broadly supported the approach that is set out in Amendment No. 1 from the beginning, although I understand the problems that the Government, the Minister and the Treasury have in giving that kind of commitment. Like my noble friend Lord Lipsey, I shall listen carefully to the Minister's reply and I hope that I do not have to vote against him.
I have stated that I have always been in favour of the Racing Trust in principle, but my main position is the interests of racing. When compared to that, whether ownership of the Tote passes to the Racing Trust or to another body is a minor point. I am concerned only with what is in the best interests of racing. I know that my noble friend Lord Lipsey has done everything that he can, but without the figures it is very difficult for us, even at this late stage of the Bill, to form a view.
The noble Viscount, Lord Falkland, mentioned a figure from the City. City people have floated much higher figures than that to me. If the figure was £500 million from private sources, that is a serious amount. As a former stockbroker, I know that the only figure that matters is the one that people in the end will pay and we do not yet know that. The price is a serious issue. I was very impressed when my noble friend Lord Lipsey said that he is quite convinced that the route through the Racing Trust, as is being negotiated, will be in the best financial interests of racing. If that is the case, I shall be very happy.
It would be embarrassing and unhelpful if some venture capital trust or "fat cat", as my noble friend put it, were to emerge and take over the Tote, but from racing's point of view, money is money and it is desirable. If there is a large amount of it, I would rather have it from a "fat cat" than receive much less from noble and distinguished sources.
I am therefore unclear as to what is the best bet for racing, but it does not seem to be a clear choice between taking the private course—and abandoning the commitment to use the trust—and using the trust. One could do a back-to-back deal. Were it the case that venture capitalists were prepared to give much more than can be raised from the other source, we could meet the Labour Party's manifesto commitment—we
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have not always done that and quite rightly, too—by passing the Tote to the Racing Trust for it to sell for a very high price to a private venture capital firm. In that way the money would come back into the trust, with the trust remaining in existence and receiving half of what might be £200 million, as well as receiving rent. There are ways in which that could be done. I am not advocating that approach. I am simply making the point that from racing's point of view what matters is what will give the most money to racing. We wait to see that outcome.
As I said, I hope I shall not have to vote on the amendment, and I hope the noble Lord will not press it, having listened to the Minister's reply. My position is very close to that of the noble Lord, Lord Lipsey, on that.
Lord Smith of Leigh: My Lords, as the noble Lord, Lord Moynihan, said in his introduction to this clause, there has been Cross-Bench support at all stages of the Bill for the position he has taken. I am one of those Peers who have taken part in the debate, but maybe my interest is somewhat different from that of other noble Lords. I want the Tote to continue as an independent organisation. I want that not simply because of the invaluable support it has given for the sponsorship of racing, but because the Tote has been a successful, innovative organisation in its own right. It has been well supported by its loyal staff who have worked for it for many years—and perhaps they deserve some reward for that. Most importantly, it is trusted by the betting public. The Tote is a real alternative to both the traditional bookmakers and the new Internet booking organisations. As such, we need it to continue.
Throughout the debates at the various stages of the Bill, we have been very much informed by my noble friend Lord Lipsey, partly because of his particular knowledge of the Bill, but also because of his general knowledge of racing. I am not sure I would agree with him that racing is a country sport; I suspect he might concede that more people from urban areas watch racing than from other areas. Nevertheless, I found his argument compelling. If we support the amendment proposed by the noble Lord, Lord Moynihan, and get into the traditional ping-pong between this House and another place, we will not be helping either the Racing Trust or the Tote. The time delay would result in such uncertainty that the objectives we all want to see might not be fulfilled.
I hope that when my noble friend the Minister sums up the debate, he will provide the House with sufficient assurances to make the amendment unnecessary.
4 p.m.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord McIntosh of Haringey): My Lords, with this amendment we return to the issue that has dominated the consideration of Part 1 of the Bill throughout its proceedings. As the noble Lord, Lord Moynihan, and others have confirmed, everybody who takes part in this debate is committed to the interests of horseracing. I commend them on that commitment, and I know that the amendment before us now reflects

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their concern. I pay tribute to the consistency and the objectivity with which these matters are being discussed.
We have considered a number of amendments of this kind before. They are designed to strengthen the position of the Racing Trust before negotiations commence between the Government and the Trust. I cannot blame anyone for doing so, but at the same time it has to be recognised that I, as a Minister of the Crown, have the interests of the taxpayer to take into account as well. We have to achieve a fair balance in our work. At each stage of the Bill's consideration, both here and in the House of Commons, the Government have argued that these amendments are unnecessary, and we still hold to that view—not because we disagree with the sentiments behind the Bill, as we too are committed to horseracing and to the Racing Trust.
The noble Lord, Lord Moynihan, has quoted our 2001 manifesto commitment, which states:
"We are committed to sell the Tote to a racing trust to allow it to compete commercially, with all long-term profits invested in the sport".
We have repeated that over and over again, and yet here I am standing before the House to say that our intention is perfectly clear. That is what the noble Lord, Lord Lipsey, has asked me to say, and I have no hesitation in doing so. We have taken practical, positive steps to achieve that aim since the matter was last debated in this House towards the end of July.
Before the Bill's proceedings commenced, the Government encouraged the development of the Racing Trust. Since then, we have had regular and constructive discussions with the noble Lord, Lord Lipsey, and with the other members of the shadow Racing Trust. I hope that there is no disagreement between them on these matters. Certainly the Racing Trust has come across to us as a body with a consistency of purpose and no evidence of disagreement.
Throughout the consideration of the Bill, the Government have taken practical steps to make the sale of the Tote to the Racing Trust a reality. At each stage, we have started preparations as soon as has been possible. I made it clear on Report that the Government would continue to make the maximum possible progress in their preparatory work for the sale of the Tote, but I also made it clear that there were important rules of government accounting that prevented the conclusion of a final deal before the Royal Assent to this Bill. That is why it is not possible to give the noble Lord, Lord Moynihan, the guarantee he is seeking that these matters can be brought to a successful conclusion.
The government accounting rules are designed for the benefit of Parliament, not the Government. They ensure that the Government cannot commit themselves to expenditure in advance of the will of Parliament being expressed, which can only be achieved by Royal Assent. It would not only be cowardly of me to seek to depart from those
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Government accounting rules; it would be entirely contrary to the interests of the legislature in its relationships with Government. I hope, and I still believe, that all sides of the House will agree that that is the correct relationship and that the Government should not be able to commit to expenditure other than that which has achieved the will of Parliament.
We have made good and solid progress since I last spoke to the House in July. We have held extensive discussions between the advisers to the Government and the Racing Trust, who have now been outed as PricewaterhouseCoopers and Rothschilds respectively. These discussions have been about all aspects of the deal, not simply about the valuation.
I assure the House that the Treasury has been involved at all stages. There is no possibility of its saying, "We were not aware of any deal or valuation". The process has been entirely open. Yesterday, it was possible for PricewaterhouseCoopers, acting for the Government, to make available the key outcomes of the independent valuation that will set the context for negotiations. In return, we have received the Racing Trust's assessment of the Tote's value. That is exactly what I said in July I hoped would happen, and it is on that basis that I said we could approach a Third Reading on 14 September with positive progress having been made. Clearly, I cannot discuss the figures, because they are "commercial, in confidence".
The noble Viscount, Lord Falkland, asked me to say how far apart the figures were. If I did, I would be bringing all the negotiations into the public sphere. I cannot do that and would not wish to. Of course discussions about the valuation will continue in advance of Royal Assent; in particular, about the assumptions behind the valuations. If we can get agreement on the different financial advisers' assumptions, the probability is that any existing gap will be reduced, as valuations made on the same assumptions are less likely to have differences than those made on different assumptions. These are not negotiations, but discussions about the basis on which the valuation is made. They started pretty much immediately yesterday and are continuing.
I am confident that when the Bill receives Royal Assent and passes into law, giving us the power under government accounting rules to begin negotiations, we shall be able to start them with confidence and optimism that the legitimate interests of both racing and the taxpayer can be recognised and that a fair deal can be struck. My noble friend Lord Lipsey, who knows the figures, has said that he is optimistic—and certainly more optimistic than he was last week. However, I think that he used the word in its absolute rather than its relative sense. I share that optimism. It is our firm intention to begin negotiations with the Racing Trust as soon as possible after the Bill receives Royal Assent.
We have instructed our financial and legal advisers to pursue a successful sale to racing at a price that reflects the fair value of the Tote. Indeed, since July we have written to the shadow Racing Trust committing to a period of exclusive negotiation with it.

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I was asked by the noble Lord, Lord Moynihan, about the European Commission. We have also made progress in our discussions with the Commission. The government team is meeting with its representatives later this month to discuss what we hope will be their final questions about state aid in relation to this transaction. I should remind noble Lords that when this matter arose before, we did not have insuperable difficulties with the Commission. We have to do it all over again because the authority we had to proceed is time-expired. But we have no reason to suppose that there will be any particular difference on issues of principle.
In all of these ways, the Government have acted on their stated policy of selling the Tote to the Racing Trust under terms that meet the objectives of all interested parties. In other words, all the things that I said in July would be done before Third Reading have in fact been done.
I heard what the noble Lord, Lord Moynihan, said about the report in the Observer on 1 August. He himself called them rumours. I beg the House to listen to assurances from Ministers and to the facts as they have been set out rather than to rumours. I say that because, as I have made clear, we have been working hand in hand with the Treasury throughout, which supports our approach. If those rumours had been true, that could not have been the case. Equally, if the rumours had been true, that would have implied that we have been working without the full collaboration of the Treasury. At no point during the passage of this Bill have the Government done anything other than make practical preparations for the sale of the Tote to racing. We are delivering on all the pledges I made during our proceedings on the Bill—and I was only repeating the pledges made by the Minister for Sport, Richard Caborn, in another place.
The amendment tabled in the names of the noble Lords, Lord Moynihan and Lord Luke, and my noble friend Lord Lipsey requires the Government to return to Parliament for its approval to sell the Tote to someone other than the Racing Trust. The noble Lord, Lord Moynihan, has confirmed that this amendment arises from the concern that the agreement we hope to achieve with the Racing Trust will prove impossible because the Government will demand a price well beyond the trust's ability to raise finance. We have again heard reference to a Treasury plot to undermine publicly stated government policy. I can confirm that my noble friend Lord Lipsey is right in all he says about the implications of us abandoning publicly stated government policy in order to guzzle up the proceeds of a sale on the open market.
I have to say that I am taken aback by such suggestions at this stage. I can understand that they might have been made at the end of last year when the sales strategy existed only on paper, and I understand that it could have been thought at that point that we were pursuing other approaches at the same time rather than pursuing the negotiated sale to racing, which is the only course we are pursuing. We are well into the preparatory process. We have appointed the independent valuer, who has been instructed to
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establish a fair value of the Tote to racing, not a maximum value that might be made on a sale to the highest bidder. And, as I have said, we are working closely with the Treasury.
Of course, the Government have the fallback position, which we need. The Racing Trust does not exist and we cannot put into legislation binding negotiations with a body that does not exist. It would be utterly irresponsible for us not to take, in legislation, the precaution of ensuring that we are not constrained in protecting the interests of the racing industry and of the public. However, we remain convinced that a sale to racing is the best way to meet both of those interests.
Before I close, let me refer to two matters raised in debate. First, the noble Lord, Lord Molyneaux, raised the issue of Northern Ireland. As he knows, horseracing is a devolved matter. The Tote and the Horserace Betting Levy Board do not operate in Northern Ireland and it will be for that administration to make any changes to legislation regarding horseracing and betting there.
Secondly, the noble Viscount, Lord Falkland, asked about a staff share incentive scheme. The Tote board has indicated that it wishes to introduce a new incentive scheme involving some equity share as part of the sale. That is one of the matters which may need to be taken forward in the negotiations when they start, but in the first place it is for the Racing Trust to reach a considered view on the proposal once it has been more fully worked up, and it would not be appropriate for me to make any further comment at this time.
So, at the risk of repetition, we have not changed our position. We have fulfilled every promise that we have made—cautious promises perhaps, but we have met every undertaking made to this House. On that basis, I urge the noble Lord. Lord Moynihan, not to press his amendment.
Baroness Noakes: My Lords, the Minister's remarks have been extremely helpful. However, before he sits down, can he clarify a point made by the noble Lord, Lord Donoughue, which has confused me a little? If the Bill goes ahead and if a sale is made to a body other than the Racing Trust, is there anything to provide that the proceeds will go to racing interests, or would that be the end of it?
Lord McIntosh of Haringey: My Lords, I made it clear on Report and it is on the record that if, in the undesirable and unlooked-for event that we sold other than to a racing trust, 50 per cent of the proceeds would go to racing.
Lord Moynihan: My Lords, I am grateful as always to the Minister for his considered response to this debate. It is the case that if everything both the Minister and his colleagues in another place have said were to be accepted as gospel, they would have absolutely no difficulty in accepting our amendment. I say that because the amendment as it stands does not require the Government to come back to this House

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with details of the sale to the Racing Trust, rather it looks exclusively at the position which could possibly arise if the central plank of the whole of the Government's position was to crumble; namely, a failure to sell to the Racing Trust. That is what this amendment focuses on.
I am quite certain that all the negotiations have been undertaken in good faith and that what the Minister has set out for noble Lords is exactly the position the Government would like to see, but when we look at the legislation before the House the fact is that, as it stands, there is a chance that it would not be possible for the Government to sell to a racing trust.
Perhaps I may give one example. Before Easter, my noble friend Lord Wakeham asked in Grand Committee a question about Europe and the extent to which negotiations with the Commission had led to a conclusion over the question of whether an adverse state aid ruling from Brussels could scupper the deal to a racing trust. It was pointed out at that stage of our proceedings that a letter had been in place confirming that there would be no problem with this deal, but that it had time-expired and the Government intended to renegotiate the matter with the European Union. However, the Minister has told us today that those negotiations are not complete. He stated that discussions will take place next week. What if those discussions go wrong, leading to a position where a sale to the Racing Trust could not move forward?
The whole point of this debate can best be summarised by what the Minister said at an early stage of our proceedings; namely, that even if no one owns the Tote, Parliament is its guardian. Today we have an important responsibility to racing in general and to the Tote in particular. The amendment before your Lordships will ensure that we fulfil our role as guardian of the Tote. A sale to the Racing Trust may collapse for whatever reason and that was anticipated today from all sides of the House as a possibility. Some circumstances are incapable of anticipation as to what might happen as a result of negotiations.
Last week the noble Lord, Lord Lipsey, was down in the dumps and unhappy about the way negotiations were proceeding. This week it looks much better. For whatever reason, we are guardians of the Tote. Parliament and all Members of this House who have spoken during our proceedings support the Government's manifesto commitment to sell the Tote to the Racing Trust. But as the Tote's guardian, surely it is right and proper that Parliament has the final decision on the sale of the Tote in the event that a sale to the Racing Trust is not possible, not in the event that there is a successful conclusion to the current negotiations, but exclusively in the event that a sale to the Racing Trust is not possible. Anything less would be a dereliction of our duty. I should like to test the opinion of the House on this matter.
4.21 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 106; Not-Contents, 181.

Division No. 1

CONTENTS

Allenby of Megiddo,V.

McColl of Dulwich, L.

Anelay of St Johns, B.

MacGregor of Pulham Market, L

Arran, E.

Astor of Hever, L.

Mackay of Clashfern, L.

Attlee, E.

MacLaurin of Knebworth, L.

Baker of Dorking, L.

Maginnis of Drumglass, L.

Blatch, B.

Marlesford, L.

Bowness, L.

Masham of Ilton, B.

Brooke of Sutton Mandeville, L.

Mayhew of Twysden, L.

Brougham and Vaux, L.

Methuen, L.

Buscombe, B.

Molyneaux of Killead, L.

Byford, B.

Morris of Bolton, B.

Caithness, E.

Mowbray and Stourton, L.

Campbell of Alloway,L.

Moynihan, L.

Carlisle of Bucklow, L.

Murton of Lindisfarne, L.

Carnegy of Lour, B.

Naseby, L.

Carrington, L.

Newton of Braintree, L.

Cope of Berkeley, L.

Noakes,B.

Dean of Harptree, L.

Northesk,E.

Denham, L.

Norton of Louth, L.

Dixon-Smith, L.

O'Cathain,B.

Dundee E

Park of Monmouth, B.

Eccles of Moulton, B.

Perry of Southwark, B.

Elles.B.

Platt of Writtle, B.

Elton, L.

Plumb, L.

Erroll, E.

Prior, L.

Feldman, L.

Rawlings, B.

Fraser of Carmyllie, L.

Reay, L.

Freyberg, L.

Rees-Mogg, L.

Gardner of Parkes, B.

Renton, L.

Geddes, L.

Renton of Mount Harry, L.

Gilmour of Craigmillar, L.

Roberts of Conwy, L.

Ryder of Wensum, L

Hanham, B.

Seccombe, B.

Hanningfield, L.

Selborne,E.

Hayhoe, L.

Selsdon, L.

Henley, L.

Simon of Glaisdale, L.

Higgins, L.

Skelmersdale, L.

Hodgson of Astley Abbotts, L.

Skidelsky, L.

Howard of Rising, L.

Soulsby of Swaffham Prior, L.

Howe, E.

Stewartby, L.

Jenkin of Roding, L.

Swinfen, L.

Kimball, L.

Tebbit, L.

King of Bridgwater, L.

Trefgarne, L.

Kirkham,L.

Trenchard,V.

Knight of Collingtree, B.

Trumpington, B.

Laidlaw, L.

Ullswater, V.

Laird, L.

Vinson, L.

Lane of Horsell, L.

Waddington, L.

Lawson of Blaby, L.

Wade of Chorlton, L.

Liverpool, E.

Wakeham, L.

Lucas, L.

Warnock, B.

Luke, L.[Teller]

Wilcox, B.[Teller]

Lyell, L.

Windlesham, L.

NOT-CONTENTS

Acton, L.

Barnett, L.

Addington, L.

Bassam of Brighton, L.

Ahmed, L.

Beaumont of Whitley, L.

Alton of Liverpool, L.

Bernstein of Craigweil, L.

Amos, B. (Lord President of the Council)

Bhattacharyya, L.

Billingham, B.

Andrews, B.

Borrie, L.

Archer of Sandwell, L.

Boston of Faversham, L.

Ashley of Stoke, L.

Bragg, L.

Ashton of Upholland, B.

Brennan, L.

Avebury, L.

Broers, L.

Bach, L.

Burlison, L.

1047

Christopher, L.

Listowel, E.

Clark of Windermere, L.

Livsey of Talgarth, L.

Clement-Jones, L.

Lockwood, B.

Clinton-Davis, L.

Lofthouse of Pontefract, L.

Cohen of Pimlico, B.

Macdonald of Tradeston, L.

Colville of Culross, V.

McIntosh of Haringey, L.

Corbett of Castle Vale, L.

McIntosh of Hudnall, B.

Craigavon, V.

McKenzie of Luton, L.

Crawley, B.

Mackie of Benshie, L.

Davies of Oldham, L. [Teller]

Maclennan of Rogart, L.

Dean of Thornton-le-Fylde, B.

McNally, L.

Desai, L.

Maddock, B.

Dholakia, L.

Mar, C.

Dixon, L.

Mar and Kellie, E.

Drayson, L.

Mason of Barnsley, L.

Dubs, L.

Massey of Darwen, B.

Dykes, L.

Merlyn-Rees, L.

Eatwell, L.

Miller of Chilthorne Domer, B.

Elder, L.

Mishcon, L.

Elis-Thomas, L.

Mitchell, L.

Evans of Parkside, L.

Morgan, L.

Evans of Temple Guiting, L.

Morgan of Drefelin, B.

Falconer of Thoroton, L. (Lord Chancellor)

Morris of Aberavon, L.

Neuberger, B.

Falkland, V.

Newby, L.

Falkner of Margravine, B.

Oakeshott of Seagrove Bay, L.

Farrington of Ribbleton, B.

Palmer, L.

Faulkner of Worcester, L.

Parekh, L.

Fearn, L.

Patel, L.

Filkin, L.

Patel of Blackburn, L.

Finlay of Llandaff, B.

Paul, L.

Fitt, L.

Pendry, L.

Gale, B.

Peston, L.

Garden, L.

Phillips of Sudbury, L.

Gavron, L.

Pitkeathley, B.

Gibson of Market Rasen, B.

Ramsay of Cartvale, B.

Giddens, L.

Randall of St. Budeaux, L.

Golding, B.

Razzall, L.

Goldsmith, L.

Rendell of Babergh, B.

Goodhart, L.

Roberts of Llandudno, L.

Goudie, B.

Rogan, L.

Gould of Brookwood, L.

Rooker, L.

Gould of Potternewton, B.

Roper, L.

Graham of Edmonton, L.

Rosser, L.

Greaves, L.

Rowlands, L.

Grenfell, L.

Scotland of Asthal, B.

Griffiths of Burry Port, L.

Scott of Needham Market, B.

Grocott, L. [Teller]

Sewel, L.

Hamwee, B.

Sharp of Guildford, B.

Hannay of Chiswick, L.

Sheldon, L.

Harris of Haringey, L.

Shutt of Greetland, L.

Harris of Richmond, B.

Simon, V.

Harrison, L.

Slim, V.

Hart of Chilton, L.

Slynn of Hadley, L.

Haskel, L.

Smith of Gilmorehill, B.

Haworth, L.

Smith of Leigh, L.

Hayman, B.

Snape, L.

Henig, B.

Steel of Aikwood, L.

Hilton of Eggardon, B.

Stone of Blackheath, L.

Hogg of Cumbernauld, L.

Strabolgi, L.

Hollis of Heigham, B.

Strange, B.

Holme of Cheltenham, L.

Symons of Vernham Dean, B.

Howarth of Breckland, B.

Taylor of Blackburn, L.

Howells of St. Davids, B.

Temple-Morris, L.

Hoyle, L.

Tenby, V.

Hughes of Woodside, L.

Thomas of Gresford, L.

Hunt of Kings Heath, L.

Thomas of Walliswood, B.

Irvine of Lairg, L.

Thornton, B.

Janner of Braunstone, L.

Tordoff, L.

Joffe, L.

Triesman, L.

Jones, L.

Truscott, L.

Kilclooney, L.

Tunnicliffe, L.

Layard, L.

Turnberg, L.

Lea of Crondall, L.

Wallace of Saltaire, L.

Leitch, L.

Walmsley, B.

Lester of Herne Hill, L.

Walpole, L.

1048

Walton of Detchant, L.

Williams of Crosby, B.

Watson of Richmond, L.

Williams of Elvel, L.

Whitaker, B.

Williamson of Horton, L.

Whitty, L.

Resolved in the negative, and amendment disagreed to accordingly.
4.34 p.m.
Clause 21 [Licensing of Olympic Lotteries]:
Lord Moynihan Lord Moynihan moved Amendment No. 2:
Page 13, line 16, at end insert—
"( ) This section shall only have effect once the Secretary of State has laid before Parliament a report setting out in detail the cost of hosting the Olympic and Paralympic Games in London in 2012."
The noble Lord said: My Lords, as the House knows, the Opposition are wholly committed to London's bid to stage the 2012 Olympic and Paralympic Games. As part of that commitment we are pleased to support Part 3 of the Bill, which will establish an Olympic lottery to provide an estimated £750 million towards the costs of staging the games in London.
The amendment is designed to strengthen our bid and to assist the work of the excellent London bid team, under the able chairmanship of my noble friend Lord Coe. I was fortunate to be in Athens this summer to witness the impressive Kelly Holmes in her memorable run for her second Olympic gold medal. Everyone I met was impressed by the excellent organisation of the games.
In these opening remarks, I want to place on record our congratulations to the Greek Government and their organising committee on the successful staging of the 2004 Olympic Games. Similarly, I invite the whole House to join me in congratulating Team GB on their achievements this summer and in wishing our paralympic athletes every success this month. While every medal winner and personal best performance deserves our praise, I feel that particular mention should go to Kelly Holmes and to Matthew Pinsent and his coxless four for their outstanding achievements.
On the amendment, it is clear that the Government must be a key stakeholder in any Olympic bid. The International Olympic Committee has required the host government to act as the ultimate guarantor of the games, although the Government have indicated that they intend to discharge that obligation through the National Lottery and the London Assembly.
From our discussions during the passage of the Bill, noble Lords will be aware that, in recent times, the majority of Olympic Games organisers have had difficulty in keeping to their original budgets. Indeed, as the Minister for Sport said in evidence to a Select Committee in January 2003:
"On the financing, one point that was interesting on our visits to cities that have already run Olympics was that in broad terms, on the costs, every one of them has doubled from the first figure that was given".
As London 2012 formulates a first-class technical bid for the 2012 Olympics, it is essential that its budget, and the Government's formula behind that budget, is equally well researched and costed. Knowing my noble friend Lord Coe as I do, and having seen his dedication and commitment as a fellow Olympian at the Moscow Games, I have absolutely no doubt that the London bid will be technically gold standard.
Our bid has been strengthened by the recent words of support from the Prime Minister. Last week, it was heartening to hear the Prime Minister say that he considered the growing sense, both at home and internationally, that London can indeed win the Olympic bid for 2012 to be one of the most important developments of this summer.
I understand that this Thursday my noble friend Lord Coe is due to present an update on the technical details of the bid, including the budget, to the Prime Minister and his Cabinet. The final submission to the International Olympic Committee of London's full bid book will take place on 15 November this year. That comprehensive document will give details of the technical aspects of our plans to host the games, including security, funding, sporting facilities, infrastructure, transport and accommodation. London's full bid book will, of course, be thoroughly costed. My amendment refers to those costings.
On the cost overruns, it has been calculated that if one uses the Minister of Sport's observations made on 15 January 2003 and applies them to the London games—namely, if the costs for London were to be doubled from £4 billion to £8 billion—the public subsidy required would increase by some £2 billion, to £6 billion. Lottery funding to all the good causes would be devastated as all its income would be taken for approximately 18 months and that would lead to an increase in the council tax precept for Londoners from an average £20 a year to £95 a year for eight years.
While all the good causes support the London 2012 Olympic bid, noble Lords may be aware that the proposed Olympic lottery will impact upon their income. That is one of the reasons why my amendment requires the Government to provide an up-to-date report on the costs of staging the London games before the Olympic lottery commences. Such a requirement will assist the National Lottery good causes in planning ahead more effectively. The additional parliamentary scrutiny should assist the Government and the London bid team to maintain a tight control on the budget.
When I tabled a similar amendment in Grand Committee, the Minister indicated that he was not averse to the principle of laying before Parliament a copy of this document. I trust that the Minister is still minded to support such a proposal. I beg to move.
Lord Addington: My Lords, Amendment No. 3 in my name is grouped with Amendment No. 2 of the noble Lord, Lord Moynihan. The issues raised here are ones of reporting and of knowing what is going on throughout the bid—the initial costing and reporting what has happened in the process of bidding for the games.
We have discussed this matter on several occasions, trying to get the right answer, and have had private discussions with the Minister. This is one last attempt to try to make sure that we get enough information into the public sphere, that not only do we have a way of making sure that we know what we are doing throughout the bid process and that the general public know what is going on, but also that we have a good record about the way the process was constructed. The Commonwealth Games of Manchester and this bid may be the two big successes we have, compared with a series of failures.
Building up that store of knowledge is what I have always been interested in. Also, if we fail in the future at anything, let us fail for different reasons from the ones for which we fail at this time. I do not expect that we will fail—I hope that we will not—but let us build up a store of knowledge. That is all I am trying to do. It is one last attempt to clarify what the Government have done in this area and what they should do in future. We have made progress in discussions. With this amendment I give the Government one last chance to clarify where the information will be so that we can build upon our body of knowledge for all sporting and—hopefully—cultural events in the future.
Lord McIntosh of Haringey: My Lords, I have been told by the Whips to keep this short so if I may read into the record for the sake of completeness my support for what the noble Lord, Lord Moynihan, says about our performance in the Athens Olympics and our confidence in the quality of the bid for the 2012 Olympics. I will not say any more at this time because government Ministers more intimately concerned have already said very similar things.
The purpose of Amendment No. 2 is to ensure that Parliament is aware of the cost of hosting the Olympic and Paralympic Games in London in 2012. We support the principle and I can confirm that we intend—as the noble Lord, Lord Moynihan, asked—to place details of the costs and revenues relating to the staging of the games before the House. As he said, the costs and revenues associated with staging the games in 2012 will be detailed in the candidate file being prepared for submission to the IOC. It has to be submitted by 15 November. It cannot be made public, according to its rules, until we have received confirmation of receipt from the IOC. But we intend to lay the full document before Parliament in November following receipt of this confirmation.
We believe that having the requirement on the face of the legislation is unnecessary. We resist the amendment because it has the potential to cause unintended delay to the start of an Olympic lottery. It could produce a further layer of bureaucracy. It could

1051
require a new report to be produced, or the repeated submission of information that would already be at the disposal of Parliament.
If a further report was required, for example after the IOC had selected London as host city in 2005, that could delay the issuing of Olympic lottery licences and therefore the start of the Olympic lottery, which I know is a cause close to the heart of the noble Lord, Lord Moynihan. I know that he wants to get the lottery game going as soon as possible. I hope that, given the assurance that he asked for, he will be happy to withdraw the amendment.
The amendment of the noble Lord, Lord Addington, calls for the Secretary of State to lay reports before Parliament following the election of the host city and, in the event of a successful London bid, following the staging of the 2012 Olympic and Paralympic Games. As he says, I have discussed the amendment with him. These reports would cover such issues as financing, the raising and distribution of lottery money, and the legacy. We are all agreed that there must be due processes in place to capture all available information in relation to the staging of a 2012 Olympic Games. I am sure that the noble Lord, Lord Addington, understands that I do not think that the amendment is the best way of achieving that end.
There are already a number of arrangements in place to capture key information and hold accountable the bodies charged with delivering the games and ensure an appropriate legacy—which is a perfectly valid point by the noble Lord, Lord Addington. London 2012, the bid company, is already obliged to produce annual accounts that will be placed in the Libraries of both Houses. In addition, the stakeholders have in place arrangements to ensure appropriate and rigorous oversight of the progress and financing of the bid.
We can be confident that in the event of an unsuccessful bid, DCMS, the London Assembly, the British Olympic Association, and the Culture, Media and Sport Select Committee, would all be poring over the reasons why the bid failed.
In relation to lottery distribution, the Olympic lottery distributor is already responsible for producing annual reports to the Secretary of State to lay before Parliament under the provisions of the Bill. This mirrors the arrangements for existing lottery distributors and, with existing powers of parliamentary scrutiny, provides sufficient financial controls.
4.45 p.m.
As regards the staging of the games, the London Organising Committee for the Olympic Games (LOCOG) would be required to produce annual reports and accounts, as would any other body created to deliver the games. LOCOG—a new word for me—is required by IOC to produce a post-games report dealing with all aspects of staging the games, including
1052
an analysis of performance. I cannot see that commissioning a further report would enhance the legislation in any way.
The following is the point about capturing the benefit of the games. We are keen to ensure that a key legacy of bidding, whatever the outcome, is transferable knowledge that can be applied to future bids. However, we do not think it necessary to do more than is already required.
In relation to capturing lessons learnt for the future. I can confirm that plans are already in place. By November this year, the Sports Council will sign off a mega events strategy, including a 20-year events forecast and guidance for bidding. The latter incorporates lessons learnt from the Commonwealth Games in Manchester and will assimilate any new 2012 messages. The information will be reviewed on a six-monthly basis by a new DCMS, devolved administration and UK sports events strategy forum, which will report to the sports Cabinet.
I hope that it is clear that we agree entirely with the thinking behind both amendments and that we have in place plans to ensure that these are given effect.
Lord Moynihan: My Lords, I am grateful to the Minister for his response. I am also pleased to take this opportunity to support the principle behind the amendment tabled in the name of the noble Lord, Lord Addington. What he proposes in the amendment seems eminently sensible and should be of benefit to Parliament, sport and the general public.
I recognise that annual reports and accounts will be published. I also agree that the post-games report would be greatly important. The Minister is right to refer to the fact that in November this year we will have the opportunity to assess the funding of the games. However, the amendment that we have tabled is specific to the time between winning the bid in July next year and starting the lottery game.
At the present time there is no opportunity for Parliament to consider an important report, setting out in detail how the government of the day will fund the Olympics and Paralympics in 2012. It is import ant that Parliament does have that opportunity. It is particularly important in light of the widely rumoured favourite election date of 5 May 2005, which comes before the July decision in Singapore. It is appropriate that a new government have the opportunity. Certainly we would welcome from our Benches when we are in government after May next year the opportunity to come to Parliament with our thinking about the funding.
In the light of that expectation, I do not feel that the Minister is right to dismiss the importance of a report being presented to Parliament at that time in the process. For those reasons I would like to test the opinion of the House.
4.49 p.m.
On Question, Whether the said amendment (No. 2) shall be agreed to?
Their Lordships divided: Contents, 89; Not-Contents, 175.

Division No.2

CONTENTS

Allenby of Megiddo,V.

Lyell, L.

Anelay of St Johns, B.

McColl of Dulwich, L.

Arran, E.

MacGregor of Pulham Market, L.

Astor of Hever, L.

Attlee, E.

Mackay of Clashfern, L.

Blatch, B.

MacLaurin of Knebworth, L.

Bowness, L.

Mancroft, L.

Bridgeman, V.

Marlesford, L.

Brooke of Sutton Mandeville, L.

Mayhew of Twysden, L.

Brougham and Vaux, L.

Morris of Bolton, B.

Byford, B.

Mowbray and Stourton, L.

Caithness, E.

Moynihan, L.

Carlisle of Bucklow, L.

Naseby, L.

Carnegy of Lour, B.

Newton of Braintree, L.

Colwyn, L.

Noakes, B.

Cope of Berkeley, L. [Teller]

Northesk, E.

Craigavon,V.

Norton of Louth, L.

Crickhowell, L.

O'Cathain, B.

Dean of Harptree, L.

Palmer, L.

Denham, L.

Park of Monmouth, B.

Dixon-Smith, L.

Platt of Writtle, B.

Dundee, E.

Plumb, L.

Elton, L.

Reay, L.

Erroll, E.

Renton of Mount Harry, L.

Fookes, B.

Roberts of Conwy, L.

Forsyth of Drumlean, L.

Seccombe, B. [Teller]

Fowler, L.

Selborne, E.

Gardner of Parkes, B.

Selsdon, L.

Geddes, L.

Shaw of Northstead, L.

Hanham, B.

Simon of Glaisdale, L.

Hanningfield, L.

Skelmersdale, L.

Hayhoe, L.

Soulsby of Swaffham Prior, L.

Henley, L.

Stewartby, L.

Higgins, L.

Strathclyde, L.

Hodgson of Astley Abbotts, L.

Tebbit, L.

Howard of Rising, L.

Trenchard, V.

Howell of Guildford, L.

Trumpington, B.

Jenkin of Roding, L.

Tugendhat, L.

Kimball, L.

Ullswater, V.

Knight of Collingtree, B.

Vinson, L.

Laidlaw, L.

Waddington, L.

Lawson of Blaby, L.

Wade of Chorlton, L.

Liverpool, E.

Wakeham, L.

Lucas, L.

Wilcox, B.

Luke, L.

Windlesham, L.

NOT-CONTENTS

Acton, L.

Bassam of Brighton, L.

Addington, L.

Bernstein of Craigweil, L.

Adebowale, L.

Bhattacharyya, L.

Ahmed, L.

Billingham, B.

Alton of Liverpool, L.

Borrie, L.

Amos, B. (Lord President of the Council)

Boston of Faversham, L.

Bragg, L.

Andrews, B.

Brennan, L.

Archer of Sandwell, L.

Broers, L.

Ashley of Stoke, L.

Brooks of Tremorfa, L.

Ashton of Upholland, B.

Burlison, L.

Avebury, L.

Chan, L.

Bach, L.

Christopher, L.

Barker, B.

Clark of Windermere, L.

Barnett, L.

Clement-Jones, L.

1054

Clinton-Davis, L.

McNally, L.

Cohen of Pimlico, B.

Maddock, B.

Corbett of Castle Vale, L.

Mar and Kellie, E.

Crawley, B.

Mason of Barnsley, L.

Davies of Oldham, L. [Teller]

Massey of Darwen, B.

Dean of Thornton-le-Fylde, B.

Maxton, L.

Desai, L.

Merlyn-Rees, L.

Dholakia, L.

Methuen, L.

Dixon, L.

Miller of Chilthorne Domer, B.

Drayson, L.

Mitchell, L.

Dubs, L.

Morgan, L.

Dykes, L.

Morgan of Drefelin, B.

Eatwell, L.

Morris of Aberavon, L.

Elder, L.

Neuberger, B.

Evans of Parkside, L.

Oakeshott of Seagrove Bay, L.

Evans of Temple Guiting, L.

Parekh, L.

Falconer of Thoroton, L. (Lord Chancellor)

patel, L.

Patel of Blackburn, L.

Falkland, V.

Paul, L.

Falkner of Margravine, B.

Pendry, L.

Farrington of Ribbleton, B.

Peston, L.

Faulkner of Worcester, L.

Phillips of Sudbury, L.

Filkin, L.

Pitkeathley, B.

Finlay of Llandaff, B.

Prys-Davies, L.

Gale, B.

Radice, L.

Garden, L.

Ramsay of Cartvale, B.

Gavron, L.

Randall of St. Budeaux, L.

Gibson of Market Rasen, B.

Rea, L.

Giddens, L.

Redesdale, L.

Golding, B.

Rendell of Babergh, B.

Goldsmith, L.

Rennard, L.

Goodhart, L.

Richard, L.

Goudie, B.

Rix, L.

Gould of Brookwood, L.

Roberts of Llandudno, L.

Gould of Potternewton, B.

Rooker, L.

Graham of Edmonton, L.

Roper, L.

Greaves, L.

Rosser, L.

Griffiths of Burry Port, L.

Rowlands, L.

Grocott, L. [Teller]

Scotland of Asthal, B.

Hamwee, B.

Sewel, L.

Hannay of Chiswick, L.

Sheldon, L.

Harris of Haringey, L.

Shutt of Greetland, L.

Harris of Richmond, B.

Simon, V.

Harrison, L.

Smith of Clifton, L.

Hart of Chilton, L.

Smith of Gilmorehill, B.

Haskel, L.

Haworth, L.

Smith of Leigh, L.

Hayman,B.

Snape, L.

Henig, B.

Steel of Aikwood, L.

Hilton of Eggardon, B.

Stone of Blackheath, L.

Hogg of Cumbernauld, L.

Strabolgi, L.

Hollis of Heigham, B.

Symons of Vernham Dean, B.

Holme of Cheltenham, L.

Taylor of Blackburn, L.

Howarth of Breckland, B.

Temple-Morris, L.

Howells of St. Davids, B.

Tenby, V.

Hoyle, L.

Thomas of Gresford, L.

Hughes of Woodside, L.

Thomas of Walliswood, B.

Hunt of Kings Heath, L.

Thomson of Monifieth, L.

Irvine of Lairg, L.

Thornton, B.

Janner of Braunstone, L.

Tordoff, L.

Jones, L.

Triesman, L.

Kilclooney, L.

Truscott, L.

Layard, L.

Tunnicliffe, L.

Lea of Crondall, L.

Turnberg, L.

Lester of Herne Hill, L.

Wallace of Saltaire, L.

Lipsey, L.

Walmsley, B.

Lockwood, B.

Walton of Detchant, L.

Lofthouse of Pontefract, L.

Warner, L.

McDonagh, B.

Watson of Richmond, L.

Macdonald of Tradeston, L.

Whitaker, B.

McIntosh of Haringey, L.

Whitty, L.

McIntosh of Hudnall, B.

Williams of Crosby, B.

McKenzie of Luton, L.

Williams of Elvel, L.

Mackie of Benshie, L.

Williamson of Horton, L.

Resolved in the negative, and amendment disagreed to accordingly.
[Amendment No. 3 not moved.]
Clause 40 [Commencement]:
[Amendment No. 4 not moved.]
Lord McIntosh of Haringey: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill do now pass.—(Lord McIntosh of Haringey.)
On Question, Bill passed, and returned to the Commons with amendments.

Housing Bill
5.1 p.m.
The Minister of State, Office of the Deputy Prime Minister (Lord Rooker): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Lord Rooker.)
On Question, Motion agreed to.
House in Committee accordingly.
[The DEPUTY CHAIRMAN OF COMMITTEES (Baroness Pitkeathley) in the Chair.]
Clause 137 [Duty to have a home information pack]:
Baroness Hanham Baroness Hanham moved Amendment No. 183:
Page 94, line 40, at end insert "within a permitted period of 14 days of the property being placed on the market"
The noble Baroness said: I shall speak to Amendments Nos. 183 and 194 together. Although they come from two different clauses, both relate to the building in of some leeway into the process of preparing a home information pack.
The provision of such leeway is crucial to the continued effectiveness of the housing market. I know that the Minister disagrees with that and although we had a Second Reading debate during our proceedings yesterday, we must continue with our amendments and our views on how the HIP should apply.
Even in this day and age of advanced computer systems, of desk-top publishing, of easily negotiable electronically held property databases and of surveyors equipped with laser-guided tape measures, if I wanted to put my house on the market this afternoon in order to execute a very quick sale under the regime imposed by Part 5 of the Bill, I would be unable to do so until my estate agent had produced a home information pack. It is possible that I could not afford that delay. There must be some flexibility in the system.
I am aware that some estate agents in areas where the home information packs were piloted were able to produce the information in the same amount of time as it took to draw up and agree property particulars. Although impressive, that still led to a delay of about
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a week in putting property on the market. Had the photograph of my house gone up in my estate agent's window on the day I had instructed the sale, that would have given prospective buyers an extra week to consider putting in an offer, knowing that the home information pack was being produced.
Although I do not know whether there are any statistics available, by and large I am sure it is a fact that sellers often want to sell in a hurry, while house buyers are happy to take a little more time. Fourteen days is by no means a figure that needs to be set in stone. Indeed, given the improvements in information technology, particularly with the advances of the National Property Gazetteer, it could be argued that as home information packs may well be ready in a couple of days a fortnight's leeway may be unnecessary. But I do not believe that we should make it a sine qua non that home information packs must be available on day one. I beg to move.
Baroness Maddock: I shall speak to Amendments Nos. 183A and 185C. They too relate to day-one marketing. Amendment No. 183A is similar to that tabled by the noble Baroness, Lady Hanham. It is a probing amendment following discussions that took place in another place. Following the Government's amendment to Clauses 138 and 139 at the Commons Report stage, some people believe that confusion has arisen on the timing requirements for the possession or production of the home information pack. To avoid any misunderstanding in the market, I am seeking clarification with Amendment No. 183A.
One interpretation of Clauses 138 and l39 as presently drafted is that the responsible person—the seller or his agent, if there is one—has to provide an HIP or part of a pack only if requested by the buyer. The responsible person has 14 days in which to do that—or more if terms and conditions are debated under Clause 139(5).
That appears to conflict with requirements in other clauses, which seem to require the possession of an HIP from the outset. I am therefore seeking clarification on whether the above interpretation of Clauses 138 and 139 is correct. Is it a relaxation of the Government's requirement for day-one marketing? If it is, it is welcome, but those outside the Chamber are confused. I would welcome clarification from the Government.
Amendment No. 185C is designed to help the Government on this issue. The Government's proposal to introduce home information packs will bring to an end the right of consumers to put their properties up for sale when they desire. In future, they will have to wait until the home information pack has been prepared. No one really knows how long that will take, as we have discussed several times already.
The Government seem willing to accept the very optimistic forecast that it could be as little as three days, while others who believe that they have a greater degree of realism and appreciation believe that it could be considerably longer. Indeed, the noble Baroness, Lady Hanham, spoke of one week. It means the ending

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of "day-one marketing" and many of those who work in the housing market feel that it is not desirable and that it could have an inflationary effect on the market.
The purpose of my amendment, therefore, is to keep the Government's options open. It provides the Secretary of State with the power to determine at a later date the appropriate period of time in which the home information pack must be made available to prospective purchasers after marketing commences.
We do not have to make the decision now. The Government have already said that home information packs will not be introduced immediately and that we are working roughly to 2007. That therefore gives us the opportunity to consult with the industry and, crucially, to monitor progress in the areas that are most likely to cause delay in the production of HIPs.
I know that the Government argue that if home information packs are not available to buyers when marketing takes place, their effectiveness will be undermined. I do not believe that that is true—and many who work in the field do not believe that it is true. Most prospective buyers arrange to view a range of properties in a given area before they narrow down their list of potential purchases. Often they will instruct an estate agent to arrange several initial interviews based on their criteria such as price, location and size. I hope that those more experienced will back me up on that. Indeed, I have done the same thing myself. At this stage, buyers will not want to be burdened with lengthy technical reports for each and every property that they view, for access to which, as I understand it, they would have to pay a charge.
Because the current home information pack proposals will delay the ability of consumers to market property, it is widely accepted that there will be some reduction in the number of properties coming on to the market. Independent studies have measured that and they give figures of between 13 and 30 per cent. If the figure is 13 per cent, that is still fairly detrimental. Even at the lower end of the forecasts, it is likely to have an inflationary effect.
The Government have questioned just how important day-one marketing really is to consumers and whether they will be put off placing their houses on the market if they have to complete a home information pack. There are conflicting views on this topic and I should be very interested to hear from the Minister whether his department has any plans to undertake some independent research into the matter before pressing ahead with day-one marketing. The amendment is designed to help them to do that, and I hope that the Government will look favourably on it. It is an important issue and it is very controversial.
The Earl of Caithness: The noble Baroness, Lady Maddock, is absolutely right: this is a crucial area and it is one that will cause a huge amount of contention unless we get it right. It will be the area where most disputes occur because vendors invariably want their houses marketed from day one. They will give instructions for whatever reason, but they want to put
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their houses on the market now. Of course some people are coming forward at present and saying, "I want to market the house next spring. Start preparing particulars now", but that does not happen all the time, and a big section of the market will be put under considerable constraint by the Bill as it stands.
We talked about this matter a little last night. It was quite late and, on reading col. 998 of the Official Report, I noticed that I mentioned a somewhat similar situation in response to the noble Lord, Lord Borrie, on the question of buying Whiteacre. If one reads what I said in the Official Report and takes it by itself, it could be misleading. What I wanted to say was that the noble Lord, Lord Borrie, would be at a disadvantage if he had to sell his house in order to make an offer on Whiteacre. In the Official Report, it reads that the noble Lord could not submit an offer to the noble Lord, Lord Phillips. Of course, the noble Lord could submit an offer, but if he had to sell his own house first in order to obtain the finances, he would be at a considerable disadvantage in wanting to buy the house compared with someone else who already had his house on the market with a home information pack.
These are critical amendments. I look forward to hearing what the Minister has to say, particularly with regard to some of the points raised by the noble Baroness, Lady Maddock.
Lord Rooker: This is a very important part of the Bill and the system. I fully accept that, but I certainly cannot accept some of the things that I have just heard, such as that the industry does not know what is going on and will be confused, and so on. From extensively published consultation documents, the industry knows exactly what we have been thinking about in some considerable detail for the past 18 months. So there are no surprises in this measure.
This is the first of a number of amendments about the duties in Clauses 137 to 141 to have a home information pack before commencing any marketing activity. I fully admit that this is an area which probably causes the most concern. I would argue that that concern is not justified and I shall try to give my reasons. However, we recognise the concern, which is why we have been doing something about it.
Ministers and officials at the Office of the Deputy Prime Minister have discussed the concerns extensively with key stakeholders, including the National Association of Estate Agents. We know that the key concerns are uncertainty over how the home information packs will impact on the market—that is a factor—and particularly how long it will take to compile the packs.
We know from experience that some agents who are providing home information packs on a voluntary basis—it is only a modest number at the moment; I realise that—can manage to compile packs in about five working days. We take the view that, given the advances in information technology, it should be possible to compile them in a shorter timeframe by 2007. And, once the Bill is enacted, that will act as a significant push to information providers to change

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their processes to ensure that the information is available very quickly. So, with compulsion on the way, it will cease to be a voluntary activity.
Some stakeholders are saying to us, "That's all very well in theory, but what if the practice turns out to be different?" What if an item in the pack—for example, the home condition report—takes a good deal longer and that acts as a logjam on bringing homes to the market? Those are issues that have been raised and it is a fair point. The big concern seems to be that if that kind of problem does arise, the Bill may be too inflexible as it stands to deal with the situation. It is that point on which I want to give the Committee some assurance.
First, following the Office of Government Commerce Gateway review of the home information pack programme, we are setting up a new, extensive programme support structure to oversee the route through to the implementation of the home information pack. All the key stakeholders have welcomed the move and they are actively involved. Therefore, it is not being done behind closed doors. Part of the job of the new programme arrangements is to bottom out and address the risks and develop effective contingencies. That work will identify and address any of the pinch points that could delay production of the home information packs.
Secondly, as I mentioned last night, there will be a dry run of home information packs before they come into force. We want to identify the components of the packs by the middle of 2005 and have them available from the middle of 2006. That will give a minimum of six months for estate agents and others to test the new arrangements before they come into statutory force. That gives a rough idea of the timetable and we have left ourselves plenty of time.
Thirdly, if we find that the speedy production of home information packs is at serious risk, provisions in the Bill would enable us to address the situation. Clause 144(9) allows the Secretary of State to address this kind of problem in regulations. He could vary the time at which a document is required to be included in the pack; he could make some kind of transitional arrangements; and he could make different arrangements for different areas, descriptions of property and other circumstances.
In short, there is an armoury in the Bill to deal with problems relating to the speedy availability of documents and other problems if they arise after all the other preparatory work, along with that of the stakeholders, has been done and defects come to light. So there is no question of the Government introducing home information packs in a way that will cause unnecessary delay in getting homes on to the market. That is not our purpose.
Some of our research has indicated that 40 per cent of consumers are dissatisfied with the current system. More recent surveys conducted by the Consumers' Association and the Yorkshire Bank both indicated a dissatisfaction rate of almost 90 per cent. Therefore, some action must be taken to improve the situation.
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One principal cause of that dissatisfaction is the lack of up-front information available to sellers and buyers. That lack of transparency at the start of the process is a primary cause of uncertainty, failed transactions and wasted costs. We genuinely believe that our reasonable proposals will remedy that, but the amendments would risk perpetuating the problems associated with the current system where sellers market their homes without the benefit of important information to guide their marketing decisions and buyers take important decisions on the basis of little or no information.
It is no good to say that this beggars belief; we know that it happens—it is happening now as we speak. We are talking about some 8,000 properties a day or 40,000 properties a week. People will be looking at places for a few minutes. They may have looked at lots of others as well but, on the basis of little or no information, they will make offers and then become very upset afterwards.
The time spent compiling the pack need not be long and we think that it is time well spent. As I have said before, all this information, save for the home condition report, already has to be provided at some stage in the process. The difference is that we are saying, "Do it upfront".
Some of the tick box forms that people fill in for fixtures and fittings and about the property itself—two or three of the forms one gets from solicitors—could be done beforehand. Sometimes there is undue delay, even as regards the solicitor getting the seller to complete the form, to tick the boxes. They say, "You are selling the house. I need the form. Tick the boxes". So, undue delay can be caused even by the seller not filling in the basic forms because they cannot decide to leave the curtains or the spice rack or something stupid like that. All of that is on the form and they simply have to tick a box.
So, there are delays. We are asking that that be done before the home is marketed. There is no problem about that. If someone decides that they want to sell the property, they obtain the forms and get them filled in. If we seek to cut corners, as the amendments would propose—the idea is to market under the present system, stick it up for sale today, find a buyer the next day, and sell the house—that is fine, but that apparent speed can be illusory. That is what we know from the present system. You think you have sold and you have not. Then there are protracted negotiations while the legal aspects are sorted out and local searches are commissioned. There can be arguments about the property and the things that are found out and arguments about the price. Each of those things can reveal problems which add to delay. Indeed, sometimes, not always but many times, they can lead to the collapse of the sale, and the whole process can be complicated by chains.
Having the relevant information at the start of the process creates a number of benefits. The seller and agent can use the home information pack to assist in setting the asking price. This is different—
Lord Phillips of Sudbury: I am sorry to interrupt the Minister in full flow. He repeatedly makes the point

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that all this upfront information is nothing but benign. However, to take one example, does he not accept that all the information that will now be required on the title of the property, which currently is not required of the vendor's solicitors until after exchange, will lead to a huge amount of wasted time and effort between solicitors in cases where, having agreed in principle to sell and buy, the property transaction then collapses because of a chain problem, a finance problem or a number of other issues; for example, change of circumstances? Does he not at least concede that in many cases those requirements will add considerably to cost?
Lord Rooker: I find that quite interesting from a lawyer; that is, the possibility of things collapsing after the offer has been made because of problems caused by finding out about technical hitches and details. It is true, I accept, that some documents might come in at the very end and that could cause a problem. However, I suspect—I shall take advice on this—that that would be in a minor amount of cases compared with the vast number that fail either because of the condition of the property or other matters relating to the condition which are found in the home condition report and which would make that miniuscule in comparison.
Lord Phillips of Sudbury: I am grateful for what the Minister said. The truth is—this is where the problem of not having a good evidential base for all this is exposed—that survey work has been done and my own survey work among the solicitors of Suffolk and North Essex indicates that the majority of transaction failures are nothing to do with the condition of the property but are to do with valuation and obtaining finance. Valuations are not part of the home information pack. That will come later. So, far from this solving the frustrations and heartache of transactions that collapse, the statistics that we have—my noble friend Lady Hamwee quoted some last night—indicate that around 15 per cent of transactions collapse because of survey issues as compared with all the other issues.
Lord Rooker: We can bandy statistics. I have some better statistics than I had yesterday—this is not the group of amendments in which to use them—which will, I hope, rebut some of the points raised. The fact is that you cannot tell the connection, except in individual cases. If there is an argument on valuation, was it caused by someone finding out more about the property than they would have known without having the home condition report? They may say, "Hang on a minute. I'm not paying that much for the property. It's not worth that much because something's been discovered". It is true that that might be ticked off as an argument about valuation. Why did that arise in the first place? Because someone found out something and, if they had found out about it beforehand they would not have made the offer on the basis of false information. So, it can look like an argument about valuation but it may be that the valuation was done in ignorance of the home condition report and not knowing about the property in the first place.
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I was half way through a really good sentence about the time spent compiling the pack. Speed can be illusory and can be followed, as I have said, by protracted negotiations while the legal aspects are sorted out. Each of these issues can reveal problems that add to the delay and the collapse of the sale altogether.
Having this relevant information at the start of the process creates a number of benefits. I was going on to say that it is perhaps novel for the estate agent to set the price of a property based on knowing something about it. That may be novel for some estate agents. Knowing information on the property they can give better advice on marketing strategy and selling price. The pack will help to identify for the seller and the seller's professional advisers problems, for example, with the title. If there are problems with the title, the time to find out about them is before you market the property, not when you are supposed to complete.
Other benefits include transparency. If a buyer makes an offer knowing the true condition, they are less likely to complain later on about valuations and other matters. We think that the cost savings should be evident. As I have said—and I will give further details on this—our modest, conservative estimate is that some £350 million is wasted each year. That is a complete waste; there are no assets gained from that. Streamlined conveyancing will be possible due to the bulk of legal and other preparatory work being carried out in the days before marketing and not the weeks afterwards with the pressures involved.
We consulted on these matters some 18 months ago, including on the issues of the documents that would be needed for the title. So, there are no surprises about what is needed in the pack by professionals.
The benefits in terms of shortening the period from offer acceptance to exchange of contracts and making the process more transparent should more than outweigh any slight delay—it can be only a slight delay—to marketing while the pack is put together. To allow marketing, even for a limited period, without a pack perpetuates the failings of the current system. Buyers and sellers would be negotiating in the dark. This lack of upfront information, as we mentioned earlier, is the root cause of consumers' dissatisfaction.
Amendments Nos. 183, 183A, 185C and 194 may have been tabled on the assumption that sellers will be unhappy waiting until a pack is compiled before marketing commences, but what sellers really want is a quick sale, not quick marketing. There is a difference between a quick sale and quick marketing. It is a quick sale that they want; the outcome, not the process. We want to speed up the process so that the outcome becomes more certain for everyone concerned.
Amendment No. 183 would delay for 14 days the duty to have a pack. As I have explained, that would perpetuate the current problems and I cannot believe that it is a serious attempt to improve the Bill. As I have said, the same arguments apply to Amendment No. 183A. Amendment No. 185C would allow the Secretary of State to make regulations prescribing a permitted period, beginning when the marketing starts, within which a pack must be provided.

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I understand the concerns, and no one wishes to see unnecessary delays. However, as I have said, the Bill contains a range of mechanisms to enable us to deal with potential problems. With the homework and spadework that is being done with the industry in full co-operation between now and the bringing into force of the legislation, such problems will not, it is to be hoped, arise.
It is important not to underestimate the difficulties for enforcement authorities—someone will have to enforce this, as will be clear—of allowing marketing for a period without a pack. That would be a difficulty. If that period were allowed, it would be impossible to police the system and I think it would remove the benefits of upfront information to buyers and sellers and leave a high chance of aborted transactions. As I said last night, it would be selling a false prospectus to the public on the basis that they thought we had done something about it.
The Earl of Caithness: As the Minister was in the middle of his most interesting sentence, I did not continue the discussion at that point. However, I should like to take him up on three or four matters. The Minister keeps referring to the current problems the industry faces. We should not forget that over 70 per cent of transactions do not cause problems; they work perfectly well. They can be speeded up, but the market is not in crisis. The market is working. Areas need attention, but to give the general impression that the market is a complete failure and in dire need of improvement is a totally wrong picture of what is happening.
The Minister referred again to the £350 million in abortive costs of transaction failures. Let us remember that that figure of £350 million was based on a survey involving 30 properties and was extrapolated from that. We must also bear in mind that those who did the research gave a caveat on the figures and said, "These figures need further work". The Government have not done that further work.
I was very interested that the Minister then started to disagree with the research that he had carried out by Key Research on the question of failed purchases. It is true that 30 per cent of failed purchases are a result of an adverse valuation survey, but now the Minister wants to look behind that. He has been beating the drum that that 30 per cent—in fact he is calling it 43 per cent because he is adding in the 13 per cent of unfavourable surveys—is the cause of this Bill. If the Minister wanted a more accurate breakdown of why purchases failed, then the Government should have arranged it at a much earlier date rather than proceeding with a Bill, so that we could at least be talking of a sensible research programme that did not have a whole lot of caveats with it.
Finally, the 13 per cent of failed purchases due to an unfavourable survey in fact works out at a net figure of less than 4 per cent of all failed transactions. That does not reflect a market in crisis.
Baroness Maddock: I thank the Minister for his clarification on Amendment No. 185C. It would
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appear that something similar to what I was requesting is actually in the Bill, but not being a lawyer. I find it quite difficult to interpret. I will look at the matter again and discuss it with others.
On Amendment No. 183A, again in trying to get to grips with how the legislation is written, I would have appreciated a little more clarification about how the 14 days works in the other two amendments to which I referred. In his reply, the Minister talked about how difficult this was to police, and said that that is why it had to be day one. However, some of it will be day 14, and somehow it will have to be policed. I will look carefully at what the Minister said and perhaps we will return to the issue.
Baroness Hanham: I too thank the Minister for his reply. I am bound to say that I think we will probably end up taking a different view on this throughout the Bill's passage.
The Minister made it very clear—it is becoming increasingly obvious—that this is an immensely bureaucratic system. When we get round to a system that is being policed, which is what the Minister now says it is, then we are really in considerable difficulty as regards the free marketing of a property. The fact that there is to be no flexibility about when the housing packs must be available is, if I may say so, rather foolish.
I do not think that the clauses to which the Minister referred, and the regulations which will perhaps come in to give some flexibility, are going to do the job at all. It seems perfectly reasonable to say that those who want to put their houses on the market can do so. They will then have a bit of time in which to finish off the bureaucratic information that must be made available. All this information, except for the home condition report, already has to be made available for the sale and purchase of any property.
I think the Minister may also be underestimating how long home condition reports will take to get done and, as I suggested yesterday, whether buyers will rely on those reports. We have not yet had any discussion about what integrity buyers will see in the reports and whether buyers will believe they can rely on what the reports say. It is likely that there will be double expenditure, with the buyer choosing to have yet another survey done, perhaps by a more qualified person than the home condition surveyor.
So, we do not agree with the Minister's view on this. I am sure that we shall return to the matter. For today, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 183A not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 183B:
Page 94, line 40, at end insert "unless the property is marketed as being sold without a home information pack"
The noble Baroness said: In moving Amendment No. 183B I shall speak also to Amendment No. 185A.
During these exchanges, I have mused on the fact that, had the Minister been a partner in my solicitors practice, which in itself is quite an interesting thought, he would probably have been one of those who used to say of domestic conveyancers—never, of course, one of our own partners—"They spend all their time asking questions like, 'Does the property have a roof?' And, if they are on the other side, 'The purchaser should rely on inspections'". I say that because I accept a little of what he says about the cumbersome nature of the process.
I suggested that the two amendments should be grouped with the last group that we debated last night on "voluntarism"—I cannot think of another word for it. Despite my request, that did not happen. I am moving the first one today because the Minister may have something to add to the issue. However, I shall not rehearse now the arguments for a voluntary home information pack.
However, I should like to pick up one point that the Minister has mentioned several times. It is relevant to this debate, and I for one have not yet got my head around it. The Minister talked about a dry run before the pack becomes compulsory. I have not yet understood how the dry run is to happen unless we have a voluntary scheme before the commencement orders bite. When the noble Lord replies, I should be grateful if he would explain just how he will ensure that there is a dry run without the problem that he has used to counter the arguments against a voluntary scheme.
These two amendments provide that a seller can choose to sell without a home information pack. It may well be that a seller would want to opt out for some of the reasons we have heard, and perhaps for others. I do not think that the buyer would be placed at a disadvantage as he will know that a pack is not available. If a buyer thinks a pack is so important that it affects his choice of property, he will not pursue his interest in that property.
The sellers may not want to provide a pack because of cost considerations—a matter which we have certainly more than touched on. The Government assume, if I understand this correctly, that the cost of compiling a pack will be absorbed by the selling agent until a sale goes through. That seems likely to put huge pressure on the agent to ensure that a sale does go through.
A number of noble Lords have expressed doubts about some estate agents, although not about all of them. But the profession as a whole has some way to go to up its reputation. There are some agents who would have a view to their own interests at least as much as to the interests of their clients and it sometimes seems to me that not every agent quite understands who his client is. I hope that the Minister can answer the specific point about a dry run and can add to it. I would hate to think that these are the killer amendments and I had not moved them. I beg to move.
The Earl of Caithness: I support the noble Baroness. She made a point that I wanted to raise at some stage. I shall follow what she said, which was that there would be pressure by estate agents to get a sale. I regret to have to say that that happens at the moment because a lot of estate agents work on incredibly low salaries but with high commission rates. That is a very bad practice in a professional business that sells somebody's prime asset. Where estate agents are on a low salary and high commission, there is huge pressure on them to get a sale as quickly as possible, regardless of the client's interest.
With a home condition report and a home information pack, there will be even greater pressure on them to get a sale. The directors will be saying, "This costs money and time for which we are not getting a proper reimbursement. Get rid of that property as quickly as possible. Get the vendor to accept a lower price. Let's get it off our books. Get it done and we can submit a fee account because that property has been hanging around". That might not be in the client's interest. On occasions, my partner and I have said to clients, "Do not accept the offer. Wait a bit". That has incurred no extra expense under the rules by which we operate at present but has proved to be for the benefit of the client in the long run.
When we discussed this yesterday, my Amendment No. 184A was grouped with the amendments. It was my fault that I did not realise it at the time and therefore did not speak to it. I notified the noble Lord, Lord Rooker, that I might at some stage raise Amendment No. 184A just to get his response. If one follows the amendment that the noble Baroness has moved, and adds this advertisement:
"This property is offered for sale without a home information pack or home condition report being currently available. Intending purchasers may be exposed to an increased risk of financial loss if adverse legal or structural matters affecting the property become evident after negotiations for the purchase have begun",
it is in the consumer's interest. It allows the prospective purchaser to say, "I am not going to bother with those properties that do not have an HIP. I will just concentrate on those that do"; or the vendor can say, "I am still interested in a property that does not have an HIP. It is exactly the same situation that I have been used to operating in in the past. I will carry on with the prospective purchase".
If, in due course, it is found that prospective purchasers are shunning properties that do not have home information packs or home condition reports, then the market will force estate agents to tell their clients that they must produce that information because they are missing out on the main section of buyers.
The noble Baroness is absolutely right to pursue her amendment but I should be grateful if the Minister would comment on Amendment No. 184A.
5.45 p.m.
Lord Phillips of Sudbury: I add to the point just made by the noble Viscount—
Noble Lords: The noble Earl.
Lord Phillips of Sudbury: I do apologise. That is the most appalling error that a man can make in this House. I doubly apologise.
At Second Reading, in relation to concerns about the effects of the packs on low value homes, the Minister said that,
"we believe that it is best left to the market to provide solutions".—[Official Report, 7/6/04; col. 86.]
I wholly concur with that sentiment. The noble Earl is absolutely right in saying that people are quite capable of judging between one offer and another, between one estate agent and another, or between an offer with a pack and one without.
But how does the Minister see the position of a couple who are poor—perhaps old age pensioners—who have to sell a house to relieve their financial problems? Are they going to be denied the prospect of a sale unless they can find an estate agent prepared to bear all the up-front costs? I think that the up-front costs are going to be of the order of £800 to £1,000. That is without solicitor's fees and solicitors are not in the habit of doing abortive work without charging for it, at least, by no means always. So if one adds solicitor's costs, one is well over £1,000.
Who is going to bankroll that? If the answer is that some estate agents will bankroll it themselves, the noble Earl made the point that they are not going to hang around for ever. If the property is still on the market after six months, they will not wipe the debt off or continue to carry it. I can tell the noble Lord that the firms that will benefit from this will be the big battalions. This is highly anti-competitive. The small, newish estate agent is not going to be able to carry the debt of £50,000 to £100,000 of unpaid expenses that will be incurred in these home packs. So, if the Minister rejects these amendments, what is the fate of the poor seller? Who is going to carry the very substantial costs, which may ultimately prove abortive, but which, in any event, could be hanging around for months?
Lord Bassam of Brighton: The two amendments in this group effectively create a voluntary system rather than a compulsory one. We have gone over this issue a fair bit already and I do not want to tire the Committee with more of our thinking behind the system. I simply say that we do not think that a voluntary system is right or fair or that it would, in the end, be at all effective. There are extensive benefits in the system as set out in the legislation. If we take Amendments Nos. 183B and 185A together, they would have the effect of making the system for home information packs voluntary. Effectively, the only duty would be for the seller or his agent to say whether the property was being sold with a pack.
Despite what the noble Earl, Lord Caithness, says, we think that there is sufficient evidence to suggest that buyers and sellers are unhappy with the way in which
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properties are bought and sold. In many cases, people are losing hundreds of pounds on abortive surveys and searches. To pick up the point made by the noble Lord, Lord Phillips, it is those who are perhaps least able to afford those costs who often end up bearing the brunt of them. I do not think that there is any doubt—and what the noble Lord, Lord Phillips, said underlines the point—that some of these costs can be quite crippling. But we think that, in the end, there will be a benefit for all in having a universal system, rather than a voluntary system.
As the noble Lord, Lord Rooker, made plain yesterday, there is a cost to the wider economy, apart from the substantial time that is wasted through abortive transactions. I do not think that anyone could seriously argue that the market is working well in all circumstances and should be left alone and unfettered; but, effectively, that is what the opposition to this main proposal suggests. Ultimately, it is not enough simply to suggest that technology will solve the problems over time. Yes, of course it will assist in the end in terms of introducing the proposed changes. That is why we have provided for a longer time, so that the benefits of speeding up transactions can be fully brought in.
I do not think that anyone has disputed the benefits of key information being provided up front. All that has been suggested is that essentially there is a disbenefit in delaying going to market, which, basically, is what is on offer here. Estate agents offering home information packs or condition surveys up front report that buyers and sellers welcome them and that many people are positively enthusiastic. Certainly, agents in my area say that to me, which I think is for two reasons. First, it is easier to market a property and, secondly, the sellers and their agents do not have the fear that extra efforts will not be rewarded.
Ultimately, this system will be welcomed, particularly when we have the added benefit of technological change. Last night, 1 heard the argument that we should simply wait for that: but we do not want to wait. Of course we want to accrue those benefits and see the system speeded up, but by having a voluntary system, which effectively would create a two-tier system across the country, all sellers would be missing out, and that would be very unfortunate.
In our view, the market is not working well enough. There are too many disadvantaged people for us to maintain the status quo. We need change and improvements so that consumers can see a real and lasting benefit. That is why the voluntary approach is not the right approach to adopt in this situation. Some people do not like compulsion, but, regrettable though it is, in this situation it is entirely necessary.
A couple of important questions and points were raised. The noble Baroness, Lady Hamwee, talked about the dry run, which she saw as a sort of voluntary system. All the pack components will be in force, including the home condition report and certification scheme. In answer to her specific point: yes, it is the commencement order that will bring in the duty after the dry run is over. It is important to respond to that point.

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The noble Lord, Lord Phillips, made a point about paying the costs and the poorer seller. That class of seller already incurs costs under the present process. Those people can least afford the wasted costs with the associated abortive transactions that sometimes occur. I know I made that point earlier, but it is important. It is much more likely that there will be greater certainty in the process when the information is up front from the moment that the property is taken to market, which those people will welcome.
Clearly there is more debate to be had about where the costs will fall. I do not necessarily accept what the noble Lord said about where that cost will be. Nor do I accept his cost estimate, which, from the evidence that we have had so far, seems to be on the high side. I think that sellers really want greater certainty in the process and less frustration, which a universal system of home information packs will provide. That is why the voluntary approach is the wrong approach and why we think that we have got it about right. Some ironing out will be done and there will be a careful process of implementation. That is why we have set the timing as we have, which will be welcomed by the industry as a whole as we move towards that point of implementation.
The Earl of Caithness: Perhaps I may clarify one point with the Minister. Did he say that, under the Government's present proposals, the abortive costs that the market experiences at the moment will not arise in the future?
Lord Bassam of Brighton: I would not want to say that there never will be abortive costs after the scheme has been introduced. I know that the noble Earl takes exception to the pilots in Bristol and does not have a high opinion of them, but so far the evidence suggests that abortive costs will be much less and abortive sales will be fewer in number. There must be a benefit from that. Neither of us would be happy estimating exactly how much less those abortive costs will be or how many fewer abortive sales there will be. All the evidence suggests that there will be greater certainty in the process, which is surely what people selling a home want. Do we not all want to see a better market that performs and works well for everyone?
Lord Phillips of Sudbury: Perhaps I may ask the Minister to expand on the dry run. All Members of the Committee want that to work and for a better system to come out of it. However, it is fair to say that the practitioners in the Chamber have more anxieties about the exceptional cases; that is, the number of cases that will not fit neatly into the proposed package. I ask, first, what is the scale of the dry run? Secondly, what is the length of the dry run?
Thirdly, and most importantly, I am sure that the Minister will agree that there is no point in having a dry run if one cannot learn from it and make such amendments as may be necessary in the light of it. My concern is whether there is anything in the Bill as presently structured—I do not think that there is—
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that will allow the Government to say, "Okay, we have learnt these lessons for sure. Two of them confirm our view about this Bill. One of them runs directly contrary to what we thought when we debated this and we will amend the legislation before it comes into full effect".
Lord Bassam of Brighton: I think that I said earlier that there will be a commencement order that will bring in the duty after the dry run is over. We have got an implementation period, which, from memory, is around 2007, giving us about two-and-a-half years. That means that there is ample scope and opportunity for discussions with the industry. Those discussions are already taking place, which, as I said, are about ironing out wrinkles. Of course we can do that.
I think that, yesterday, my noble friend Lord Rooker gave an example in the legislation where we will be able to do things by order. I have not got that at the forefront of my mind, but I am saying to the noble Lord, Lord Phillips, and to Members of the Committee: yes, we will do this carefully and constructively and we will work with all the relevant stakeholders who are discussing those sorts of details with us now. As I said yesterday, we want to make this work with good will. Because we have a lengthy run-in period, we can achieve that, which is in everyone's interests.
Lord Phillips of Sudbury: I am sorry to press this, but it is very important. If, for example, in the dry run, it was found that transactions of a certain type generally did not react constructively to the pack, in current legislation I do not think that there is anything that would allow the Government to say, "Fine, we are going to exclude that class of transactions from the compulsion".
The Government would not lose anything in conceding that parts of the Bill, such as the one on the basis of which these amendments are brought forward, could have within it the power of the Minister to make the provisions compulsory or not. At present, there is not that leeway. I am not asking for an answer now. But, because this has emerged as being really important, I am asking for the Government kindly to look at the whole of the dry run, which, in a sense, is the sort of pilot that we were talking about last night, and build into the legislation enough leeway so that if their expectations are not fulfilled by the dry run we are not trapped into having to come back to Parliament to change the legislation.
Lord Bassam of Brighton: The noble Lord makes perfectly reasonable points. To recap: the scale will be national, there will be a six-month minimum period and of course we will learn from it. We have the power to make regulations to exclude different types of property and different components. If the noble Lord is looking for the authority for that he will find it in Clauses 143 and 144. I am reminded that it was not so long ago that we produced the home information pack consultation paper. There are few surprises in this debate because much of the content and thinking behind it is contained in that document.

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We have ample time to refine it further. The way in which we have set out the legislation provides us with the flexibility that the noble Lord seeks. This is where trust, good will and working together with the stakeholders can deal with some of the problems that perhaps the noble Lord and the noble Earl, Lord Caithness, see as intractable.
6 p.m.
Baroness Hamwee: I am aware that we have spent about an hour on the first two groups of amendments. In introducing this amendment I deliberately did not repeat all the arguments from yesterday. I hope that I speak for my noble friend Lady Maddock—the noble Baroness can speak for herself—in saying that we do not need to have the Government's arguments repeated. New points are always welcome. We have got the message. We disagree on the matter. That is why I carefully did not repeat the arguments but used the amendment as a basis to ask a question on which my noble friend has built.
I still do not understand how a dry run will do anything much to assist knowledge if the arguments that the Government have been advancing about the need for compulsion apply. It seems contradictory, but I shall not pursue the matter now. We will pursue it later. So much of the Government's proposals are based on their understanding—as our arguments are based on ours—of the experience of different groups of people with different experiences of sales, properties and so on.
It would be extremely helpful if the Government could give us a list of all the survey work they have carried out so that we can consider whether they have hard evidence about what will happen to small estate agents—or what will happen to elderly people, perhaps someone having to move into a residential home, whose experience will be completely different from a young family moving to a bigger house. There are so many different aspects.
I hope that that will enable us to answer some of our questions. It would be extremely helpful to know what survey work has been undertaken. I am not sure that the Minister will be able to comment: perhaps he will do so later today. I leave that point with him and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 184 to 185 not moved.]
Lord Rooker Lord Rooker moved Amendment No. 185ZA:
Page 95, line 1, leave out "to" and insert "where the responsible person is"
On Question, amendment agreed to.
[Amendment No. 185A not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 185B:
Page 95, line 7, at end insert "; and
( ) the seller markets the property himself"
The noble Baroness said: The amendment proposes that an individual who markets a property himself, not through an estate agent, is not required to have a home
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information pack. There may be an argument about provisions applying to estate agents selling in the course of business. We have said already that we are interested in protecting consumers, but it is not at all obvious that a seller wishing to undertake the sale himself should be as restricted in his ability to sell as the provisions would ensure.
Most DIY home sellers, unless they have a background in conveyancing, would not have the expertise to assemble a pack. Sellers are consumers as well. The noble Baroness, Lady Hanham, mentioned technological advances. As a consumer or seller I might want to take advantage of what is available over the Internet. Information in the field of domestic property is now refined to make it as straightforward as possible for land registration and so on.
I wonder whether it is appropriate for the Government, who talk about choice, to provide that a DIY seller would not have a choice. I beg to move.
Lord Borrie: It would be a great pity if the Committee accepted the amendment. It would make a large hole in the proposals in Part 5. It has been said both by the noble Baroness, Lady Hanham, and by the noble Baroness, Lady Hamwee, that a seller is a consumer as well as the buyer. When one normally thinks of consumer protection one thinks of the buyer and protection for the buyer vis-a-vis the seller. First-time buyers, an important group of purchasers of houses, they are buyers only.
This part of the Bill gives added protection, not only to first-time but to other buyers, so that above all when they make an offer they do so on the basis of intelligible and comprehensive information and knowledge about the property. That is the basis of having this material available from the moment of marketing as we have repeatedly debated on this part of the Bill.
In a chain there are chains of buyers and sellers One of the sellers may be selling their house without a professional estate agent. We have said many times that a chain is a most important consideration under this part of the Bill. There are many reasons why someone would wish to sell his property without an estate agent. It may be to save the commission; it may be someone with time on their hands to show people around the property and so on. Why should the element of purchaser protection, which I want to emphasise, be lost just because the seller or one of the sellers in a chain is selling privately and not through an estate agent?
Of course the assembly of much of the information may require more professional expertise than even the most bold vendor may have; yet we all know that people do their own conveyancing, selling and acting as an estate agent.
The additional requirement under Part 5—which has to be provided up-front instead of later on—is to have available a home information pack at the time of marketing. That is most important. It would be a pity if it was not required on all occasions. The attempts of the other side to make this a voluntary practice have

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been discussed. The amendment is another way of trying to reduce the effectiveness of Part 5 by saying, "It should apply only to those in the profession of estate agent". I think buyer and customer consumer protection would be severely limited if the amendment were accepted.
Baroness Hanham: Does the noble Lord, Lord Borrie, agree that the only part of the pack which would not have been required anyway in the normal course of events is the home condition report? As far as I am aware, the purchaser has had the choice of whether to obtain a survey. It is now being suggested that the purchaser should not have that choice—the decision is being foisted upon them by the Government. The Government are saying to them, "You are stupid not to get a survey. You must go ahead and have a survey, which will come with the home condition report in the pack". That is the first issue.
Secondly, the only time that I have come across a chain for purchase was when my daughter was buying a flat quite recently. What caused the trouble in the chain was the valuation of property further up, where people were negotiating to bring prices down and pressure was being brought to bear. That may or may not have been to do with a survey result, but I suspect that it was far more to do with how much money people further up the chain at the highest levels could obtain before pressure was put on to get the prices down.
This is a hugely bureaucratic system to provide a survey of a property on which purchasers may very well not rely anyway. There will be a whole caboodle of measures, including policing, to get people to do something they may not have wanted to do originally.
Lord Borrie: The noble Baroness has raised many wide questions, including whether or not a purchaser will rely on the survey. We have not yet discussed that and it is not my role to try to answer all those questions.
The aim of this part of the Bill, and the compulsory element of it, is to change the culture of the past where a vendor will market a property and put it up for sale without any indication of what it is like. Buyers are expected to produce an offer and, if they are going to compete with other buyers, as they do, to do so as soon as possible without having any idea about a whole range of issues that are fundamentally important if the matter is eventually to go through. This change of culture is wholly desirable.
Turning to the amendment, it would be a great pity if the requirement applied only when a property was put on the market by a professionally qualified estate agent.
Lord Phillips of Sudbury: I have never felt less in sympathy with the noble Lord, Lord Borrie, for whom I hold an ancient and deep regard. He speaks like a bureaucrat to his back teeth. If we are to change the
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culture—and we are changing the culture—this is a bureaucratic juggernaut to crush a handful of individuals who sell their own properties.
The noble Lord referred to a large number of individuals selling their own properties whereas it is a tiny number. We really should be able to accommodate the odd eccentric individual who does this. I suggest that self-interest will make the number extremely small.
We put up with individuals doing their own conveyancing. If the noble Lord and the Government want to be consistent with this bureaucratic theme, we had better put an amendment in the Bill which prevents people doing their own conveyancing. Believe me, that gums up the works and prevents the smooth-flowing, swift, transactional perfection that the Bill is supposed to bring about. So do that.
We allow people to go into courts and advocate for themselves. They gum up the works; they cause a frightful delay; they are a mess and a muddle. Stop it. We should not allow these individuals to get in the way of the perfect bureaucratic state.
I feel very strongly about this point. I urge the Government not to listen to the siren song of the noble Lord, Lord Borrie. The amendment will affect a tiny number of cases and we should be prepared to accommodate them.
6.15 p.m.
Lord Avebury: Perhaps I may ask a completely different question and slightly lower the temperature of my noble friend's torrent of vitriol against the noble Lord, Lord Borrie, if that is not too strong a word.
Lord Phillips of Sudbury: It is too strong.
Lord Avebury: I simply want to ask what happens in the cases of individuals who, as my noble friend says, choose to market their property through the Internet and the role of the webmaster is simply to place the details of the property on a site and not to do anything else in connection with the sale, such as, as my noble friend mentioned, the conveyancing.
If an individual simply wishes to use a common website because that is where potential buyers, the purchasers, would normally look—and therefore it is a good place to show your wares—and undertakes the rest of the transaction himself, is the webmaster of that site a responsible person within the meaning of the Bill; or does he incur any other liabilities under the Bill simply by reason of the fact that he places the details of that property on his site?
Lord Borrie: I am sure my noble friend the Minister will answer that more adequately than I can. I would have thought that the webmaster was not an estate agent and that the vendor was retaining his own responsibility for marketing the property.
I am delighted to hear the noble Lord, Lord Avebury, give the example—as did the noble Baroness, Lady Hamwee—of more and more people putting their properties for sale on the net in this way.

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It only goes to show that his noble friend Lord Phillips, who asked me vitriolic questions a moment ago, may be understating the case when he says that only a "tiny number" of people sell their own properties. I suggest that it is probably not a tiny number and that in future, because of the net, it may well increase.
Lord Bassam of Brighton: I think I am entering into some kind of private grief in this debate. I would not describe it as vitriolic, but it has certainly been illuminating.
To go back to where we should be and to consider the amendment and its effect, my noble friend Lord Borrie is right: this is another way of trying to develop a two-tier approach. The amendment seeks to put sellers who are selling direct, without going through an agent, in a different position. Clause 135 provides that the seller becomes responsible for marketing the property when he or she puts the property on the market or makes public the fact that the property is on the market. Clause 137 provides that a seller, while responsible for marketing a property, is not himself subject to the duty to have a home information pack if he employs an estate agent to market the property on his behalf and he believes on reasonable grounds that his agent has a home information pack.
That enables sellers to rely on their agents to meet the home information pack obligations. It avoids unnecessary duplication and expense and minimises the direct impact on sellers.
I should pick up on something that the noble Lord, Lord Phillips, said. He said that we were depriving a minority—"a tiny number" was, I think, the expression he used—of direct sellers of the opportunity of going to market without the encumbrance, as he sees it, of the home information pack. Around 95 per cent of homes are marketed by estate agents, so that leaves 5 per cent. I am not a brilliant mathematician but, if we are saying that something like 8,000 properties go to market a day—that is the figure I am most familiar with; some 40,000 a week—that means that 400 sellers a day go out to the market direct. I would not describe that as a tiny number. It is a tiny percentage, but it is a significant number during the course of a year. I dispute the claim that it is a tiny number.
In the vast majority of cases, of course, the home information pack duty will fall to the estate agent, but if the amendment were to be agreed, people would be tempted to see it as a form of loophole and it could increase significantly the number of direct sellers if they thought that it would give them some form of market advantage. The amendment would create another form of a two-tier system, where private sellers could market without packs, but those who use an estate agency would not have that facility. That would create uncertainty in the market and risk undoing the main benefits in the new system. In a chain of transactions, delays and problems with homes marketed by sellers without packs would cancel out the benefits of packs provided by estate agents for the homes that they were marketing. That would be a highly unsatisfactory outcome.
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As we said earlier, all sellers stand to gain from a more efficient and effective system where there is less waste and fewer transaction failures. The number of transaction failures is not insignificant. It is thought that a transaction failure takes place in 30 per cent of cases where a property goes to market. That suggests that there is a lot of scope for wasted expenditure.
We are trying to create a better and more effective market—a market that is well informed and works well. The amendment does not provide sufficient protection for the market and I dispute the suggestion of the noble Lord, Lord Phillips, that the numbers involved are tiny and insignificant. We would not be persecuting direct sellers. We are tying to provide for a better and more effective universal system. It is right that there should be a level playing field. We cannot accept the amendment for those reasons.
The noble Lord, Lord Avebury, asked what would happen to people who market via the Internet and whether the webmaster would be an estate agent. "Estate agent" is defined in Clause 132 of the Bill. I doubt whether many webmasters would fulfil that definition. However, it is possible for Internet estate agents to exist. I agree with the interpretation of my noble friend Lord Borrie of where the liability rests.
The amendment has allowed us to expand a little more on the benefits of the new system. I cannot accept that we would be persecuting those who wanted to sell direct.
Lord Avebury: I looked at the definition of "estate agent" in Clause 132(1) to which the Minister referred. It states:
"A person acts as estate agent for the seller of a residential property if he does anything, in the course of a business in England and Wales, in pursuance of marketing instructions from the seller".
If the owner of a property instructs the webmaster to put it on the website, is that not in pursuance of marketing instructions? I am not quite so certain that the definition has the meaning which the Minister has ascribed to it. I would sooner he took advice on it from those who are familiar with these matters than give me an off-the-cuff answer in Committee.
Lord Bassam of Brighton: I am happy to take further advice. I have had some advice. In that situation, the webmaster is probably operating in the same way as a newspaper or broadsheet. That takes us back to the question of who is the vendor. It is not the webmaster.
Lord Phillips of Sudbury: The Minister mentioned the figure of 5 per cent. I took that to mean 5 per cent of properties marketed. My strong impression is that the majority of people who try to sell their houses themselves are not successful and they eventually end up with estate agents. If the amendment were not accepted, all would-be direct sellers would be driven into the estate agency market. The Government may think that is a good thing; I think that it has an impact on people's choice and freedom.
Baroness Hamwee: The amendment has certainly taken us into unexpected areas. The noble Baroness,

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Lady Hanham, has quite understandably anticipated some amendments that will come later. In identifying that the only novel item in the home information pack is the house condition survey, she rightly reminded us that the survey will not necessarily be adequate for lenders and that not everyone now chooses to have one. I suspect that it is often people whose finances are on a knife edge in making a purchase who take the calculated risk of not having a survey carried out. The Government are seeking uniformity, but what they are proposing contains a strong element of nannying.
The noble Lord, Lord Borrie—the siren, whom I shall now think of as Lorelei—said that when one talks of consumers, one normally thinks of purchasers. I agree with that in a commercial context, where the seller is selling a number of similar or identical items. It is not the case here. I am not sure whether the noble Lord made the same point, but I shall clarify our position. In proposing the amendment, we are not suggesting that one DIY seller in a chain would exempt others in the chain producing home information packs. We shall certainly come back to the issue. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 185C not moved.]
Clause 137, as amended, agreed to.
Clause 138 [Duty to provide copy of home information pack on request]:
The Earl of Caithness The Earl of Caithness moved Amendment No. 185D:
Page 95, line 8, at end insert—
"( ) A seller or responsible person acting on the instructions of the seller may decline to provide a potential buyer with a home information pack until such time as an offer for the purchase of the property has been accepted by the seller."
The noble Earl said: Amendment No. 189A has been grouped with this amendment. I do not think that it bears any relation to Amendment No. 185D so I shall degroup it. I shall come back to it as a separate amendment.
Amendment No. 185D is a simple amendment. When discussing an earlier amendment, the noble Baroness, Lady Maddock, referred to people who come along "shopping for particulars". They look at a vast number of houses before they narrow down their search. If each of them wants a home information pack, a huge amount of extra paperwork and wasted time will be involved in preparing those packs. The packs are not going to be insubstantial documents.
Members of the Committee will know that I pointed out at Second Reading that an Office of Fair Trading report noted that in Denmark, which the Government think offers such a good comparison that it has to be used in their arguments, the home information pack now goes up to 800 pages. There will be a lovely lot of people carrying around 800 pages. But do they have to carry around 800 pages? If somebody comes to me and asks for a home information pack and I know that person is not going to buy the house because he has looked at five other properties and has yet to buy anything, can I say to him, "No, I am not going to give
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you a home information pack. You can look it up on the web". Does that satisfy the requirement for providing a home information pack? Or do I have to give him the 800 pages of material that he is never going to read and then throw away? How many more trees will have to be cut down to satisfy this demand?
6.30 p.m.
As a result of the present Bill, there will be a huge amount of abortive costs. I probed the Minister, the noble Lord, Lord Bassam, earlier, on whether he thought there would be such costs in the future. He backtracked a little from what I believe he said earlier, and said "We're not quite certain. We can't quantify it". I can tell him that there are a great many abortive costs in any housing market; even in the Scottish system, where they are going to have voluntary packs. If I put an offer in for a house in Scotland and it is accepted, that offer—in the vast majority of cases—becomes binding. Therefore, if, say, 20 people all want a house, there will be 20 surveys, only one of which will be part of an accepted bid. That means abortive costs for 19 other people. It does not matter which market we look at: New South Wales, Denmark, Germany or America. To proclaim that there will be no such costs, or that they will be any different from the alleged £350 million at present, is a misrepresentation of the true situation.
This amendment is designed to save abortive costs, and to allow the seller or the agent acting on behalf of the seller—to say "I've got a home information pack, but you can't have it. You come forward with your offer, and if it's accepted, I'll give you the pack". I beg to move.
Lord Avebury: I think it is a very good idea, as the noble Earl has said, for home information packs to be provided on the web. It is not absolutely clear to me, from the way the Bill is worded, whether that would discharge the duty to make the pack available. If vendors did not wish their HIPs to be generally available to the public at large, they could make the information on the web password-protected, so anyone going to the estate agent and expressing an interest in a property would be given the necessary password, and would then have access to the pack. If the Bill allows information to be provided in that way, I warmly welcome it, because that would cut down unnecessary information and encourage estate agents to be more web-friendly than they are at the moment. I know most of them are already fully alive to the benefits of electronic marketing, but if it were made clear on the Bill, which at the moment it is not, that displaying the pack on the web would discharge the duty to provide the same, it would be extremely welcome.
Lord Bassam of Brighton: Perhaps I could remind your Lordships of what the Bill actually does, before I make my points on why we cannot accept this particular amendment. The Bill places two main duties on those responsible for marketing property. The first duty, in Clause 137, is to have a home information

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pack in their possession while the property is on the market. The second duty, in Clause 138, is to provide a copy of the pack to a potential buyer who asks for it. As most of your Lordships now probably understand, that is a qualified duty, and subsection (4) of Clause 138 sets out circumstances where no copy has to be provided. Essentially this is where there is no prospect of the property being sold to the person making the request.
The effect of the amendment would be, as the noble Earl accurately described it, to convince sellers, although they have a home information pack in their possession, to refuse to provide a copy of it, even to a genuine potential buyer. The noble Earl expressed it very well—in short, the colour of the person's money should be shown before he gets access to the HIP. We cannot accept that. It is, after all, the primary purpose of the pack to enable buyers to reach a well informed decision on the most significant purchase they will make. As far as we are concerned, this amendment would completely undermine that purpose, and for that reason I cannot accept it. I invite Members of the Committee to reject the amendment.
The Earl of Caithness: Could the noble Lord, Lord Bassam, answer my question, which was supported by the noble Lord, Lord Avebury? If somebody comes into my office and says that they wish to have a home information pack, can I refer them to the one on our website, instead of having to give them paper?
Lord Bassam of Brighton: The answer is "yes", if the potential purchaser is happy to receive a copy in that form. I think that is provided for at subsection (10) of Clause 138.
The Earl of Caithness: I am extremely grateful for that clarification. So, I do not have to give a home information pack to anybody—I can say that our pack is on the Web, and one can look at it there. I need one office copy, full stop.
Lord Bassam of Brighton: I did not say that.
The Earl of Caithness: I listened very carefully to exactly what the noble Lord, Lord Bassam, said. The noble Lord referred me to subsection (10) of Clause 138. I am fulfilling the duty to have a home information pack by having it in my office. If a purchaser comes in and wants to see it, I can now say to him, "Yes, you can see it. It's on the website". Is that correct?
Lord Bassam of Brighton: It would certainly satisfy the requirement if the potential buyer is happy to receive it in that form. If he is not, I suggest that the agent would have to provide it in another form—that is, a hard copy.
The Earl of Caithness: I am grateful for that clarification. I come back to the original point: this is going to lead to a lot of wasted time and bureaucracy. I know of potential purchasers in the market now who
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will happily spend their Saturdays visiting estate agents—most of whom do work on Saturdays, so theirs is at least a six-day week saying they want home information packs just for the fun of it. They already do just that with sets of particulars. That will add to the unnecessary cost and bureaucracy that this Bill will produce. The more we look at the Bill, the clearer it is that it is a mess, which will not help the housing market.
Lord Borrie: If the person who has asked for the report is not genuinely interested in buying the property, the agent does not have to give him a copy of the pack.
The Earl of Caithness: They will all say they are genuinely interested now. I will be able to say to them, "I remember Lord Borrie saying that I don't have to give it to you, because he said so in debate and it's in the Bill", and they will say "I'm going to take you to court. I am genuinely interested. You prove that I'm not". Therefore, in order to save all that kerfuffle, I will inevitably have to have lots of copies of the home condition report—which, in Denmark, would be 800 pages—ready and available. If the property is particularly attractive, we could attract a huge amount of interest: tens of inquiries in a day. That means producing a report for every potential person asking about the property, which is an added cost, extra bureaucracy, and a waste of time. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 186 and 187 not moved.]
The Deputy Chairman of Committees (Lord Tordoff): If Amendment No. 188 is agreed to, I shall not be able to call Amendment No. 188A for reasons of pre-emption.
Lord Hanningfield Lord Hanningfield moved Amendment No. 188:
Page 95, line 24, leave out subsections (4) and (5).
The noble Lord said: Here we continue with our recent debate. Subsections (4) and (5) of Clause 138 are among the most curious in Bills currently going through Parliament. Subsection (4) places an onus on the agent to possess such extraordinary powers of wit and intelligence that, frankly, such people should not be estate agents but secret agents working for MI6.
We have already discussed at length the fact that estate agents do not at present have to fulfil any professional qualifications or requirements. Anyone can become an estate agent. However, this subsection calls for an estate agent who can estimate another person's wealth from the moment they step into the shop, who can tell a con man from any other member of the public, and—most bizarrely—can tell whether a potential buyer will not be approved by the seller.
I look forward to the Minister's response to this amendment because, as it stands, this is an example of over-legislation—an argument that could apply to many other points we have discussed today. Subsection (4)(a) seems to assume that an estate agent

1081
would have detailed knowledge of a person's means to buy property. I grant that certain customers may well be known to an estate agent as people who have difficulty in raising finance—a point just touched on by my noble friend Lord Caithness. It may be that their income is uncertain or that they have to self-certify their income if they are self-employed. However, it would be a mistake to legislate so that an estate agent is given discretion to pass up a sale simply because he suspects that a prospective buyer cannot afford a property. We all know what lenders are willing to underwrite in debt changes almost on a daily basis. To that end, it will be almost impossible for an estate agent to gauge whether a prospective buyer is solvent.
Subsection (4)(c) is even more anomalous. In Committee in another place the Minister was able to pluck out of thin air a hypothetical example to illustrate when this paragraph could be used. He suggested that if a seller has told his agent that he wants only prospective buyers who are keen gardeners to receive a home information pack, this paragraph would apply. We do not need to legislate for this. Surely once a vendor has met and shown a prospective buyer the property, if he feels that his herbaceous borders might fall into the wrong hands, he has no obligation to accept an offer made by such a non-green-fingered buyer. This is silly legislation and let us please get rid of it. I beg to move.
Baroness Hamwee: We tabled Amendment No. 188A which is also in this group. It also seeks to persuade the Government to explain just how people to whom the seller is not likely to be keen to sell the property are to be identified. I am sure that the Government are satisfied that the provision does not provide the possibility of a get-out by leaving it wholly as a matter for the judgment of the vendor or the agent, but how will that be dealt with on an objective basis? How will it be enforced? The whole provision seems very curious.
Quite apart from that, how is the question of confidentiality in respect of the home condition report and other documents to be dealt with? I have been told by the Law Society that details, for example, of burglar alarm systems are normally provided before exchange. I assume that that is not the sort of thing that would have to be included, but perhaps the Government will take this opportunity to expand on both points.
6.45 p.m.
Lord Phillips of Sudbury: On this occasion I rise to speak in favour of the Government's position. Members on these Benches have said broadly that we are not happy with many aspects of the home information packs. The system is not flexible enough and we do not like the element of universal compulsion. However, this is an attempt on the part of the Government to provide some leeway. While I agree absolutely with the noble Lord who has moved the amendment and my noble friend that the language of subsection (4) is loose and rubbery, I am grateful for small mercies.
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I think that there will be occasions when someone seeks to buy a £1 million property, but the estate agent asks: "How are your finances? Are you dependent on a mortgage?". If the response is, "Yes, we will need a 100 per cent mortgage", and the buyer's occupation is that of a capstan lathe turner, the agent might reasonably deduce that the property was a little beyond the buyer's ambition.
Similarly, from time to time you can take a powerful dislike to someone else for reasons you think are good. They may be familial or business reasons. Alternatively you may think that someone is a crook and has done harm to your family. Given that, why on earth should you not be allowed to say, "Whoever else I sell my property to, it will not be John Smith"? As long as the decision is not unlawfully discriminatory, why should one not do that?
I shall be interested to hear the Minister's response, but for my part I accept the provision because it makes a modest inroad into what is otherwise too compulsory, universal and inflexible a scheme.
Baroness Hamwee: I rise to respond briefly to my noble friend. As a careful lawyer, I am sure that he and I would both want to ensure that something which he and I think is right does not cause trouble. The paragraph must be drafted in a way that would achieve the end we both want to see.
Lord Phillips of Sudbury: I agree with that, but on the other hand my noble friend may agree with me that it is unlikely that a person would take someone to law on this paragraph unless it was plainly an "in-your-face" rejection made without any reasonable grounds. However, perhaps I am becoming too optimistic at this point in the debate.
Lord Bassam of Brighton: It is always nice to be surprised when speaking at the Dispatch Box. The speech just made by the noble Lord, Lord Phillips, has been a very pleasant surprise indeed. It almost makes me wish that I had been old enough, back in 1970, to vote for him. I used to live in the area where the noble Lord stood for election. However, that is wishful thinking on my part.
What we are trying to do here is to enable potential buyers to be entitled to have a copy of the pack or part of the pack if they want it and are prepared to pay any reasonable fee for the copying costs, and Clause 138 provides for this. Potential buyers will often want to show a copy to their legal representative, for example, or look at the contents at their leisure. That is fair enough, but we can foresee situations in which the seller or his agent should be able to turn down such requests for copies without breaching the home information pack obligations. As I pointed out earlier, subsection (4) of this clause sets out the three possible circumstances when the duty to supply a pack may not apply.
The first of these circumstances is when the seller or his agent believes, on reasonable grounds, that the person could not afford the property in question. The agent might know the financial circumstances of the

1083
person in question, for example. The seller may also want to exclude people who could not demonstrate that they had arranged "in principle" a mortgage offer.
The second circumstance applies if it is believed that the person making the request is not really interested in buying the property or one like it. An example of this might be where a journalist poses as a buyer to gain access to the home information pack relating to a celebrity's home. Another example is that of a serial time-waster who is known to the estate agent.
The third reason allows someone not to provide a copy of the pack if they believe that the potential buyer is not a person to whom the seller would wish to sell the property. There could be all sorts of caveats which a seller might want to attach to the sale of the property. For example, a seller with a prize-winning garden has already been mentioned. He might instruct the agent not to market to anyone who was not a keen gardener and who might neglect the garden.
There are human rights implications here as regards the right to privacy. This subsection simply reflects the current position, where someone can simply refuse to sell his home to a particular person if he wishes to do so, and for no particularly good reason. Having said that, the provision does not affect anyone's rights under the legislation governing discrimination on the grounds of race, sex or disability. In no way can this provision be used to contravene that legislation.
Subsection (5) provides that subsection (4) does not apply if the responsible person knows or suspects that the person making the request is an officer of an enforcement authority. These provisions in our view strike a reasonable balance between the need, on the one hand, for genuine buyers to get copies of important documents and, on the other, for sellers or their agents to refuse this where they believe that there are good grounds to do so.
Amendment No. 188A would remove the right for a seller or their agent to refuse to supply a pack if they believe that the person asking for copies was not someone to whom the seller was prepared to sell the property. While we can understand the sentiment behind the amendment, I believe that the concerns which have been expressed about it are misplaced. The existing legal position is of course being preserved. A seller can choose to whom they wish to sell and to whom they do not. It would be unreasonable to put a seller under a duty to provide copies of the pack to people they know they will never sell to. For those reasons we cannot accept either of the amendments. I am very grateful to the noble Lord, Lord Phillips, for setting out some very good arguments in support of our case.
Lord Hanningfield: I know that the noble Lord, Lord Phillips of Sudbury, gave the Government some little measure of comfort when speaking to these amendments. He also agreed that the wording of the clauses, which concerned us more than anything, can be very much misinterpreted. I agree with the noble Baroness, Lady Hamwee, that there might be some legal challenge to them.
1084
This is the problem with this section of the Bill. When looking for a new house most people want to look at about 50 houses. If I were looking I would want to look at between 50 and 100 houses. One would want information about 100 houses because one would want to visit in a wide area. Most of the people I know looking for a new house look at that number before buying. Because they go to an estate agent and ask for details of 20 houses over a period of two or three weeks does not mean that they are not seriously in the market. But as my noble friend Lord Caithness said, it means an enormous amount of paperwork in the future because one cannot just get the simple detail of a house and look at it and then dismiss it, because one has to have a pack.
Therefore, I believe that these clauses would mitigate against buyers who want to put a lot of effort and thought into the new home. It is about the freedom of the consumer. We have had several discussions about that today. People will finish up with a large number of packs when choosing a new home. I believe that although the clauses are protection fir some people, they are written in a way which can deter and work against the purchase. We shall have all these arguments again at Report, which will take another month at the rate we are progressing at the moment. I shall not pursue this amendment any further today. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 188A not moved.]
Lord Rooker Lord Rooker moved Amendment No. 188B:
Page 95, line 36, leave out subsection (6) and insert—
"(6) That duty does not apply where the responsible person is the seller if, when the request is made, the duty under section 137 does not (by virtue of subsection (2) of that section) apply to him.
(6A) But where the duty under this section is excluded by subsection (6), it is the duty of the seller to take reasonable steps to inform the potential buyer that the request should be made to the other person."
On Question, amendment agreed to.
Baroness Hanham Baroness Hanham moved Amendment No. 189:
Page 96, line 12, at end insert—
"( ) All documents and information contained in the home information pack shall be confidential to—

(a) the seller,

(b) the person acting on his behalf as an estate agent,

(c) a person acting on his behalf as a solicitor or conveyancer, and

(d) any bona fide buyer or potential buyer."

The noble Baroness said: We had quite a lot of discussion about Internet packs, but we have not discussed how confidential information packs should be and to whom, particularly to those who are on the net. It is very easy to publicise on the net. This amendment is designed particularly to ensure that a degree of privacy is maintained between the various parties in a property transaction.
Clearly, confidentiality is easy to administer when dealing with paper-based documentation, and I shall come back to that. By and large, people respect the

1085
word "Confidential" written across the top of a page. But without getting too bogged down in the intricacies and complexities of Internet protocols and security, if a home information pack were to be sent via an e-mail, by and large it would be secure. It will meet the recipient without falling into the public domain.
However, if a home information pack were to be posted on an estate agent's website, it would be publicly accessible and it could be misused. Will these information packs be confidential to those who are given them? It goes back to the question which the noble Lord, Lord Hanningfield, raised a minute ago about the number of packs which people are likely to obtain.
Unusually, in these packs there is a home condition report and, unusually, therefore, there is going to a large amount of information about a particular property if the pack is done properly. Potentially, a great number of people are going to have access to that information and pass it from hand to hand, if that is what they want to do. I suspect that if someone receives a home information pack and then decides not to proceed they will pass it to someone else. There will come a moment when an estate agent will not know who has its information pack.
We need to look at the extent of the role of the information pack and whether there is to be any privacy, particularly on the Internet, to which I have directed the amendment. It is wide enough to encompass the information packs in general. As I say, I believe that there is a potential problem here where there will be a great deal of information available about a property to people who may not have interests which are wholly worthy. I wonder whether we can do something about that. I beg to move.
Lord Bassam of Brighton: In our view this is a valuable amendment because it raises the important issue of confidentiality. We certainly recognise that there are circumstances where a seller would not want information about their property disclosed to people outside the home buying and selling process. I gave one example earlier of the celebrity who might simply see it as a ruse by a journalist to find out more about the home and its contents.
Generally speaking, there is unlikely to be anything in the home information pack which could cause problems if disclosed to parties other than those directly involved in the transaction. That is a generality.
Clause 144 restricts the contents of the pack to information about the property. Information of a personal nature about the seller could not be prescribed for inclusion in the pack. Also, the information contained in the home condition report will relate specifically to the condition of the property and its energy efficiency. It will not contain sensitive or personal information, for example, about security arrangements or even about the way the property is furnished or decorated.
1086
Even so, there could be cases where information in the pack might be obtained and used for purposes that have nothing to do with the sale or purchase of the property and circumstances where the information might be used in a way which offends the seller. Two examples which spring to mind are those where a double glazing salesman obtains home condition reports for the purposes of identifying potential business opportunities and then bombards those properties with sales literature. Even more intrusive would be the example of the public figure I gave earlier.
These are serious issues and we need to ensure that the Bill addresses them and complies with human rights legislation. I believe that the Bill does that. Clause 139 enables any person who has any concern about the use to which any information would be put to impose certain conditions. If they wanted to restrict the category of person to whom the information could be disclosed to those set out in the amendment they could do so.
As I said earlier, Clause 138(4) ensures that sellers and their agents do not have to give copies of the pack, or any document in it, to someone who is not genuinely interested in buying the property or someone to whom the seller would not be prepared to sell the property.
It is worth mentioning in passing that the seller or agent would always have up to 14 days to provide a copy of the pack. In circumstances where there was suspicion it would provide scope for some form of investigation as to whether the buyer is genuine. I am sure that most agents will use that time valuably.
The noble Baroness is right to focus on this serious issue. We believe that we have covered it in the way in which we have framed the legislation. It will be the subject of further discussion as we come closer to the implementation date. No doubt, where there are genuine and real concerns, matters can be further hammered out.
7 p.m.
Lord Avebury: Would it be possible for the person selling the house to provide that a copy of the home information pack should be issued only on loan and that once someone has decided not to proceed with a purchase, it should be returned? It seems to me that that is one way in which a person, who is worried about the dissemination of information about his house to third parties, could protect himself. He would know that anyone walking into an estate agency and obtaining a copy of the pack would have possession of it only for as long as he was seriously interested in the house and that he would have to return it at the end of that process, whether or not he proceeded with the purchase.
Lord Bassam of Brighton: The noble Lord asks a good question. I was going to reflect on it, but I am advised that that may be a condition that could be

1087
placed on the release of the pack. That appears to be a reasonable condition. I hope that helps the noble Lord.
Baroness Hanham: I am grateful to the Minister for that. However, he did not address the issue of the Internet. I freely admit that I am not very clever about the Internet, but, listening to my noble friend Lord Caithness earlier, I understand that people can look at an estate agent's website. He asked whether it would be possible for an estate agent simply to say to someone, "The pack is on our website so you can look at it".
One problem about that is the security of that information and whether there is any basis for making that information private. I appreciate that these documents will never be totally private, but I believe that one must try to ensure that they do not get into the hands of the wrong people who will cause trouble for potential sellers.
There may come a time when a seller decides that he will not sell his house but many of the packs will still be roaming around. We then return to the issue of the double-glazing salesman and people ringing doorbells who should not be. We cannot ignore the point. I know that the Minister is briefing the noble Lord, Lord Bassam, as we go along, for which I am grateful, so I shall be quiet and then perhaps the noble Lord can tell me what the Minister is saying.
Lord Avebury: When the noble Earl, Lord Caithness, raised this point about the home information packs being on the Internet, I suggested that to maintain confidentiality, the site could be password-protected or a particular page could be password-protected. When someone applies for a home information pack he would be given the password and the information would be deleted from the site as soon as the sale had been made.
Lord Bassam of Brighton: My noble friend Lord Rooker has helpfully told me that that is standard practice now. I am thinking hard. I have one or two friends who are estate agents and they have a similar system with password-access only. That is probably the key to the point raised by the noble Baroness, that an access provision will be provided. No doubt sellers will want that because they will not want miscellaneous information bouncing around and available to all and sundry. If a seller decides to take his house off the market, he would not want the information left on the estate agent's website. It may be that conditions are applied that ensure that the information is protected. That does not appear to be at all unreasonable.
Baroness Hanham: I am not sure why the Minister does not accept my amendment. In fact, he has done everything but accept it. I offer him the chance to accept the amendment before withdrawing it, with the possibility of returning to the matter again.
Lord Bassam of Brighton: I shall not accept the amendment. I have explained clearly why that is so. In
1088
essence, we believe that the concerns of the noble Baroness are quite right, but that the legislation provides the protection that is required.
Baroness Hanham: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Geddes): I understand that Amendment No. 189A has been degrouped from Amendment No. 185D.
The Earl of Caithness The Earl of Caithness moved Amendment No. 189A:
Page 96, line 12, at end insert—
"( ) At completion of the purchase, the buyer of a residential property shall reimburse to the seller or other responsible person who originally paid for the preparation of the pack the cost of the home information pack provided to them.
( ) The total cost exclusive of VAT or other statutory taxes is not to exceed 0.25% of the sale price of the subject property excluding any apportionment for fixtures and fittings."
The noble Earl said: This is a simple amendment. At the moment, Prescott's penalty weighs heavily on every vendor. Every seller will be faced with considerable extra costs. In a good housing market a seller may sell his property quite quickly and the costs may not be too onerous, but in a slack housing market—as when I first set up an estate agency and it took a long time for properties to move—there will come a time when the agent, the home condition surveyor or inspector—he would not be a qualified surveyor and the solicitors will say, "Money please", to the vendor and the vendor, whether or not he has sold his property, will have to pay a large sum of money.
It seems to me that to balance Prescott's penalty, the purchaser should reimburse the vendor, on completion, with the vendor's costs, which are limited by subsection (2). That would make the sellers keen to proceed, as they will want to conclude a sale as quickly as possible and the purchaser will appreciate the commitment into which he has entered. I believe it is a fair and reasonable amendment. I beg to move.
Lord Bassam of Brighton: The noble Earl has been very astute in seeing that the Bill is silent on the issue of how the costs of the pack will be met. That is deliberate on our part. It is clear to us from discussions with the industry that sellers will be able to choose from a wide range of options; for example, some mortgage lenders are likely to provide a free pack as an incentive to sellers to stay with them on to the next purchase. Some voluntary home information pack schemes currently run by estate agents provide a pack without an upfront charge. In some cases the cost is recouped via a commission fee, as one may expect. Alternatively, of course, sellers may choose to pay for packs themselves and seek to reflect the cost in the purchase price.

1089
Our view is that the market will provide consumers with many choices and the imposition of a statutory straitjacket, in our view, would be very unhelpful. That is not what we want. The noble Lord, Lord Phillips—if I may remind the Committee of his earlier argument—said that in certain circumstances it is desirable to have flexibility. We have provided for that. We believe that it would be wrong to impose that as an obligation on the buyer. We do not want to see the cost forced on to buyers. We believe that the market will sort this out. In those circumstances, how the cost of the pack will be met is open.
The Earl of Caithness: The noble Lord is right about fees. The evidence in Denmark is exactly as he has said. In Denmark, since the introduction of the home information packs, the fees charged by agents have risen; they will also rise in this country. The amendment mitigates that fact by putting the onus on the purchaser. The whole of the onus at the moment is on the vendor. The vendor has to commission all the work upfront and it has to be paid for. No solicitor, no estate agent, no home condition inspector will do that for free. That is not the world in which we live.
It would be wrong of me to say that I shall withdraw the amendment and return to it at another stage. I am taking enough on to another stage and it is time to test the opinion of the Committee.
7.9 p.m.
On Question, Whether the said amendment (No. 189A) shall be agreed to?
Their Lordships divided: Contents, 53; Not-Contents, 119.

Division No.3

CONTENTS

Astor, V.

Kingsland, L.

Attlee, E.

Lindsay, E.

Blatch, B.

Luke, L.

Bridgeman, V.

Lyell, L.

Brooke of Sutton Mandeville, L.

McColl of Dulwich, L.

Brougham and Vaux, L.

Mancroft, L.

Byford, B.

Marlesford, L.

Caithness, E.[Teller]

Masham of Ilton, B.

Carlisle of Bucklow.L.

Monson, L.

Carnegy of Lour, B.

Montagu of Beaulieu, L.

Cope of Berkeley, L.

Morris of Bolton, B.

Crathorne, L.

Mowbray and Stourton, L.

Crickhowell, L.

Noakes, B.

Dean of Harptree, L.

Northesk, E.

Dixon-Smith, L. [Teller]

Norton of Louth, L.

Dundee,E.

Elton, L.

O'Cathain, B.

Fookes, B.

Park of Monmouth, B.

Geddes, L.

Renton, L.

Glenarthur, L.

Seccombe, B.

Hanham, B.

Selsdon, L.

Hayhoe, L.

Strathclyde, L.

Higgins, L.

Ullswater,V.

Hodgson of Astley Abbotts, L.

Waddington, L.

Hogg, B.

Walpole, L.

Howell of Guildford, L.

Wilcox, B.

Kimball, L.

Windlesham, L.

1090

NOT-CONTENTS

Acton, L.

Lester of Herne Hill, L.

Allenby of Megiddo, V.

Lipsey, L.

Alli, L.

Livsey of Talgarth, L.

Amos, B. (Lord President of the Council)

Lockwood, B.

Lofthouse of Pontefract, L.

Andrews, B.

McDonagh, B.

Archer of Sandwell, L.

Macdonald of Tradeston, L.

Avebury, L.

McIntosh of Hudnall, B.

Barker, B.

Mackenzie of Framwellgate, L.

Barnett, L.

McKenzie of Luton, L.

Bassam of Brighton, L.

Mackie of Benshie, L.

Billingham, B.

McNally, L.

Borrie, L.

Maddock, B.

Brennan, L.

Mar and Kellie, E.

Burlison, L.

Massey of Darwen, B.

Clark of Windermere, L.

Maxton, L.

Cohen of Pimlico, B.

Miller of Chilthorne Domer, B.

Corbett of Castle Vale, L.

Morgan of Drefelin, B.

Crawley, B.

Morris of Aberavon, L.

Davies of Oldham, L.[Teller]

Neuberger, B.

Dean of Thornton-le-Fylde, B.

Oakeshott of Seagrove Bay, L.

Desai, L.

Parekh, L.

Dixon, L.

Patel, L.

Drayson, L.

Pendry, L.

Dubs, L.

Phillips of Sudbury, L.

Elder, L.

Pitkeathley, B.

Evans of Temple Guiting, L.

Ramsay of Cartvale, B.

Falkner of Margravine, B.

Rendell of Babergh, B.

Farrington of Ribbleton, B.

Rodgers of Quarry Bank, L.

Faulkner of Worcester, L.

Rogan, L.

Filkin, L.

Rooker, L.

Gale, B.

Roper, L.

Gibson of Market Rasen, B.

St. John of Bletso, L.

Goldsmith, L.

Sawyer, L.

Goodhart, L.

Scotland of Asthal, B.

Gould of Brookwood, L.

Sewel, L.

Gould of Potternewton, B.

Sheldon, L.

Graham of Edmonton, L.

Shutt of Greetland, L.

Grocott, L. [Teller]

Simon, V.

Hamwee, B.

Smith of Clifton, L.

Harris of Richmond, B.

Smith of Leigh, L.

Hart of Chilton, L.

Snape, L.

Haworth, L.

Stone of Blackheath, L.

Hayman, B.

Taylor of Blackburn, L.

Henig, B.

Temple-Morris, L.

Hilton of Eggardon, B.

Thomas of Gresford, L.

Hogg of Cumbernauld, L.

Thornton, B.

Hollis of Heigham, B.

Tomlinson, L.

Holme of Cheltenham, L.

Tordoff, L.

Hooson, L.

Triesman, L.

Howells of St. Davids, B.

Truscott, L.

Hoyle, L.

Tunnicliffe, L.

Hunt of Kings Heath, L.

Wall of New Barnet, B.

Jacobs, L.

Walmsley, B.

Janner of Braunstone, L.

Warner, L.

Jones, L.

Watson of Richmond, L.

Kilclooney, L.

Whitaker, B.

King of West Bromwich, L.

Williams of Crosby, B.

Kirkhill, L.

Williamson of Horton, L.

Layard, L.

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.
7.20 p.m.
Clause 138, as amended, agreed to.
Clause 139 [Section 138: imposition of conditions]:
[Amendments Nos. 190 to 191A not moved.]
Lord Rooker Lord Rooker moved Amendment No. 191B:
Page 96, line 24, leave out "Such"
On Question, amendment agreed to.
[Amendment No. 192 not moved.]
Clause 139, as amended, agreed to.
Clause 140 [Duty to ensure authenticity of documents in other situations]:
Lord Rooker Lord Rooker moved Amendments Nos. 192A and 192B:
Page 96, line 42, after "be" insert "—
(a)"
Page 96, line 43, after first "or" insert—"
"(b) a copy of"
On Question, amendments agreed to.
Baroness Hanham Baroness Hanham moved Amendment No. 193:
Page 96, line 44, after "duty" insert "to take all reasonable care"
The noble Baroness said: The amendment looks minor, but is intended to tighten up the language used in the clause. "Duty to ensure" is a particularly onerous duty to have, and a fairly unforgiving one. An estate agent can only reasonably be expected to rely on information and documentation given to him by other parties when putting together a pack, if indeed it is the estate agent who puts together the pack. An agent is under an obligation to do all that he can to get all the documentation correct, but he cannot be held responsible for errors that other professionals make.
We therefore propose that the insertion of,
"to take all reasonable care",
would adjust the clause so that its meaning was clear. An agent has to do all that he can, but ultimately errors in documents forming part of a pack have to be the responsibility of the original authors and originators of the information for the document itself. I beg to move.
The Earl of Caithness: My noble friend is absolutely right. My Amendments Nos. 195ZA and 195ZB are rightly grouped with Amendment No. 193. It would be quite unwarranted for an agent or a seller—a private individual, should he be responsible for preparing the pack—to be liable for information that he has not compiled himself.
The home information pack will now be a weighty tome. As I said, in Denmark it is now 800 pages, and only a fraction of that relates to the work of the estate agent. Surely the estate agent is responsible under the Property Misdescriptions Act for the work that is properly that of an estate agent, but where the home information pack includes searches, the home condition report and items from the solicitor, there is no way that he can verify whether those are true. The estate agent should therefore not be the person at risk. I support my noble friend in her amendment.
Lord Phillips of Sudbury: I can only add, in agreement with what has been said, a fact that may not be abundantly clear to everyone who looks at the clause. It will be in the gift of the seller how many agents he or she employs. The innocent agent, if I can call the person that—the agent who did not, for example, prepare the survey report—will have
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absolutely no say over the agent who did. It seems unfair that they will therefore be lumbered with the bad work of someone whom they had no choice in selecting and of which they were not aware because they did not do the survey.
Lord Rooker: Before I reply in detail, I want to take up a point that the noble Earl just made, because he again repeated something that he has said at least three or four times today. We had lots of correspondence following Second Reading—I accept that it was delayed—in the course of which I gave him information based on information from the chief executive of the Danish equivalent of the National Association of Estate Agents. It was that, in recent years, the home information pack in Denmark had grown to 210 pages. Why the noble Earl keeps multiplying that by four, I do not know.
The figure is not 800 pages, but the noble Earl has given that figure three or four times, notwithstanding the fact that our own consultation paper published 15 months ago gave an example of the home information pack that ran to about 100 pages, 20 of which would be the home condition report. We are not even at the Danish levels, which are a quarter of what the noble Earl has said.
The Earl of Caithness: As I said earlier, the figures that I am using are in direct quotation from the OFT's report on estate agents, in the international comparison section.
Lord Rooker: Okay—I am correcting the OFT then. I gave the noble Earl the figure of 210 pages, in writing. He did not have to use the OFT's information; he could have used that of the chief executive of the Danish estate agents. He has chosen to use a figure that is greater, from this country rather than from the Danes. I assume that the Danes probably know more accurately than the OFT the level of their pack.
We can come back to the issue. As I said, the British equivalent in our consultation paper runs to about 100 sheets—I have not counted exactly—including the 20 pages of the home condition report. They are all there for anyone to see. It was published in March last year, so there should be no surprise about that for anyone outside the House or inside it. I do not have to accept whether Denmark's figure is 800 pages or 200; ours will not be like that. In any case, however great the pack is, everything in it already takes place. All that we are doing is bringing the information upfront. It does not matter whether the figure is 100 pages or 500; the information comes from what takes place now, with the sole addition of the home condition report, which will run to about 20 pages.
I shall return to Amendment No. 193. I thank the noble Baroness for it, because I hope that it enables me to give a satisfactory explanation. In order for the packs to have any value, the information has to be authentic and accurate. However, it is not necessary to import the additional words into the clause. The trading standards officer would not serve a penalty charge notice on someone who had taken care to

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ensure the authenticity of the content of the pack; it would certainly be most unreasonable to do so. We can put that on record now.
The Bill is long and I do not expect Opposition Members to have read every detail of it; I have not done so myself, which is why I take advice. In fact, there is already a provision in the Bill that makes what I have said clear. Paragraph 6(3) of Schedule 7, which is on page 207, provides that there are grounds of appeal against the service of a penalty charge if,
"in the circumstances of the case it was inappropriate for a … notice to be given to the recipient".
That could usefully be covered in guidance to trading standards officers on enforcing home information pack duties. We will raise the matter with the Local Authorities Coordinators of Regulatory Services.
In respect of Amendment No. 195ZA, it is unnecessary to put those words into the Bill. The trading standards officer would not serve a penalty charge notice on someone who has taken that care.
Amendment No. 195ZB would absolve an estate agent from any responsibility for ensuring the authenticity of the documents in the pack where these have been provided by the seller or a separate company not associated with the estate agent's own business. Acceptance of the amendment would undermine one of the principles of the Bill. Under this, the responsible person—whether that is the seller himself or the estate agent employed by him—is responsible for ensuring that a pack is in place when marketing begins and that that pack meets the requirements of the legislation. If the amendment were accepted, an estate agent who knew for certain that a particular document was not authentic would nevertheless be quite free to hand it over to potential buyers. I do not believe that anyone—the noble Earl or anyone else—would accept that as being right.
We are happy to put on the record that we would regard it as most unlikely that an estate agent who relies on the authenticity of documents supplied from a reliable source will be in breach of any duty to ensure authenticity. I ask the Committee to remember that an estate agent is not taking on legal liability for the documents in the pack. I repeat that the estate agent does not take on legal liability for any of the documents in the pack.
The home inspector is responsible for the home condition report. The local authority is responsible for any local searches. Any redress sought by anyone for problems with documents within the pack is against the person who produced the document. The responsible person needs to be careful that the documents are genuine. I hope that that answers the questions. Some detail is buried deep in the schedules, but that meets the point of the main amendment.
The Earl of Caithness: I thank the Minister for that clarification. It is helpful and it takes us forward.
Baroness Hanham: I, too, thank the Minister for that explanation. It was extremely helpful and it is good to have it on the record. I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
Lord Rooker Lord Rooker moved Amendment No. 193ZA:
Page 97, line 10, leave out "in response to a request" and insert "in pursuance of the duty"
On Question, amendment agreed to.
Clause 140, as amended, agreed to.
Lord Bassam of Brighton: I beg to move that the House do now resume. In moving the Motion, I suggest that the House be again in Committee not before 8.32 p.m.
Moved accordingly, and, on Question. Motion agreed to.
House resumed.

Mineworkers' Compensation
7.32 p.m.
Lord Lofthouse of Pontefract Lord Lofthouse of Pontefract rose to ask Her Majesty's Government what steps they are taking to speed up payment of compensation for mineworkers and former mineworkers who suffer from bronchitis and emphysema and to control the legal fees associated with such claims.
The noble Lord said: My Lords, first, I am delighted to see that my noble friend Lady Morgan of Drefelin has chosen this debate for her maiden speech. Indeed, I am indebted to her and I know that many miners will be, too.
It is over nine years since the British Coal disease legislation came under the control of a High Court judge and nearly six years since the miners won their case in the High Court. However, it is clear that this was a pyrrhic victory since thousands of elderly miners and widows continue to die without receiving their compensation. It is now time to take stock and to ask one question: is the High Court scheme being run for the benefit of the miners or the lawyers?
According to the Department of Trade and Industry, there are a total of 569,000 claims under the chest disease scheme. Of those claims, 320,000 now relate to deceased miners. Over the past six years, only 152,000 claims have been settled. I was appalled to learn that 417,000 claims are still outstanding and that they will take another 10 years or more to resolve. How many miners will still be alive by the time this shambolic process is finally concluded?
I well remember the suffering in the countryside as a result of the foot and mouth outbreak. However, are there any farmers still waiting for their compensation from Her Majesty's Government? I would think not. The fact is that compensation in that case was prioritised and delivered with great speed. Why, therefore, must miners whose lungs have been destroyed through toil in the mines face another decade of waiting?
The commitment of Her Majesty's Government to the miners and widows has been honoured by the provision of more than £4 billion funding, without

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capping. I make no direct criticism today against Her Majesty's Government. When Mr Justice Turner first made the award, the Government immediately made £2 billion available and since they have doubled that. There is no direct criticism of them—it is levelled against the administration of the scheme and not least against the lawyers. Why is the compensation being paid out at a snail's pace?
That brings me to the lawyers. In the miners' litigation, fortunes have been made. However, that has not been good enough for some lawyers. Let me tell your Lordships about Mrs Gladys Leadbeater, an 80 year-old widow of the late Albert Leadbeater, a Yorkshire miner. Mrs Leadbeater's claim was dealt with and compensation and a couple of thousand pounds in legal fees were paid by the Department of Trade and Industry. However, lawyers promptly took £9,000 from Mrs Leadbeater calling it "success fees".
I have before me a letter to the Law Society from their son, Dr Gary Leadbeater. Dr Leadbeater pointed out that if he had acted like these lawyers, he would have been charged with professional misconduct and lost his professional registration, his job and his reputation. Dr Leadbeater recognised that the £9,000 has been repaid to his mother and that the Law Society has taken belated measures to secure compliance of solicitors. However, neither Dr Leadbeater nor I will allow this matter to rest. It should not be left to elderly miners' widows to ask lawyers to make repayments. The duty to pay the money back, together with interest, should rest upon the lawyers, with the Law Society undertaking compliance of this. Every lawyer in the UK who has taken money off miners and widows must be forced by the Law Society to repay their clients without further delay.
For my part, I cannot surpass Dr Leadbeater's eloquence in putting forward the case for the miners and their families. In the circumstance, I trust that noble Lords will bear with me while I read a short extract from his letter, in which he said:
"My father was an honourable and highly principled person whose sole aim was to ensure the happiness and welfare of his family. He, along with my mother and sister, was and are the most courageous and decent people I know, and as a family we strongly believe in being treated with decency and respect by others. That is perhaps why we feel so aggrieved about being deceived, and angry at knowing that many others in similar circumstances have been cheated by people ostensibly in positions of trust".
Dr Leadbeater goes on:
"Let us not forget what the Coalhealth Compensation Awards are all about. They are intended to bring some comfort and restitution to sick Coal Miners and their families, recognising their past suffering and their need to move on with their lives. The money was never intended to line the pockets and boost the bank balances of a small number of Solicitors Firms with questionable ethics and corrupt practices. These people have already been remunerated for their work, so why do they see fit to take more from the deserving? And why do they get away with it?"
The lawyers have had six years to deliver compensation provided by the Government to the miners and their widows. I ask this Chamber to send them a resounding message that we shall not stand by and allow this interminable process to continue for a further 10 years.
Is it not correct that at present Mr Justice Turner is forcefully expressing concern about the unacceptable delay in this process? And is it not correct that, in fact, miners and their widows and families are suffering because of the delay? I call upon this House to request the Government to set up a public inquiry into the inordinate delays and exorbitant legal costs and to report back to this Chamber with great urgency.
This is not a situation in which, if people do not speak up, the problem might go away. If all those hundreds and thousands of people—miners and their widows—have to wait 10 years before a settlement, can anyone honestly say how many of them will be alive? I suggest that the answer will be: very few. I hope that this House will take note tonight and advise the Government and whoever is responsible for the delays that the situation is unacceptable and that something must be done to stop it.
7.44 p.m.
Baroness Morgan of Drefelin: My Lords, it is with great pleasure that I address your Lordships' House for the first time. I would like to begin by offering my thanks to the staff of the House of Lords for their help and kindness since my introduction. With the large number of new Peers coming in, I know that I am one of many maiden speakers to offer my thanks, but I hope that that will not diminish the sincerity of my words incl my expression of gratitude for the enormous support and courtesy that I have received.
I learnt today that I am the youngest Baroness in your Lordships' House, and I feel particularly aware of the wealth of experience and wisdom around me. This engenders a great sense of humility in me as I stand here. But, since my introduction, I have been overwhelmed by the generosity and warmth of welcome from everyone and now, rather than feeling overawed, I am thoroughly proud and looking forward to making a strong and purposeful contribution to the work of your Lordships' House.
In preparing for my maiden speech, I have obviously taken a great deal of advice from my fellow Peers, and so it will come as no surprise that I plan to be brief. I aim to share with your Lordships a little more about my background and why I have chosen to contribute to this very important debate tonight.
I am the great-granddaughter of a south Wales miner. I have devoted much of my working life to the pursuance of social justice through the work of the voluntary sector and also the Labour Party, first campaigning for tenants' rights at Shelter, then for a national childcare strategy and then, throughout the 1990s, concentrating on health and patient advocacy. I spent some years at the National Asthma Campaign, where I had first-hand experience of the devastating impact of occupational lung disease.
For the past nine years. I have been chief executive of the breast cancer charity Breakthrough, which established the UK's first dedicated breast cancer research centre. Only last week, it launched a world-leading study into the genetics, environmental and

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lifestyle factors of breast cancer, which we hope will lead to the prevention of possibly in excess of 20,000 cases of breast cancer every year.
I have chosen to contribute to this debate for a number of reasons—most importantly because of my concern for the 17 million people living in the UK with chronic illness, the qualify oflife of a large proportion of whom can be deeply undermined with no prospect of cure and who are cared for by an NHS that many would agree is designed to support acute rather than chronic illness.
Most often, the causes of chronic disease are poorly understood and prevention is merely an aspiration. But that is not so in the case of occupational disease. So it is absolutely right and a matter of great importance that those of us in our community whose early death or suffering could have been prevented by the actions of their employer should be fairly and fully compensated. But that is no easy matter. As my honourable friend the Parliamentary Under-Secretary of State for Trade and Industry in another place said only last week:
"Nothing can bring back a sick miner's health or restore years lost to ill health, and no sum can be traded for the loss of good health".—[Official Report, Commons, 9/9/04; col. 958.]
I am concerned not to stray into the realms of controversy or, indeed, to overrun my time, and therefore I shall confine my remarks to a few more general points. I congratulate the Government on establishing the largest compensation scheme of its kind in the world. It is a courageous effort and one which I hope will benefit literally hundreds of thousands of families throughout the UK. Such a multi-billion pound scheme, paying out more than £1 million a day for respiratory illness alone, will inevitably have problems, and I am encouraged by the open and constructive approach that appears to have been adopted by the parties involved in trying to identify solutions for the benefit of the miners and their families.
Whether regarding the difficulties for miners exposed to surface-level dust, which is not currently covered by the scheme, or with regard to those who receive offers that amount to less than their solicitor's fee, or with regard to, say, the uncertainty about the treatment of miners with occupational asthma, much needs to be resolved.
But, most importantly, I believe that the overwhelming message from this debate should be that there is no time to waste in addressing these claims. Living with emphysema or chronic bronchitis can be a nightmare. In the daytime, your world can be the size of an armchair and your sleepless nights a time of breathless fear and isolation. A protracted compensation claim will do nothing to lend dignity and reassurance in such a situation. So I urge that everything should be done to reach a speedy resolution to the huge number of outstanding claims and prove wrong the worrying newspaper assertions that miners and their families will have to wait many years for this vital compensation. I thank noble Lords for their kind attention.
7.50 p.m.
Lord Dixon: My Lords, first, I congratulate my noble friend Lord Lofthouse of Pontefract on again securing a debate on this important issue. This is the third such debate he has secured since he came to this House in 1997. He first raised the issue with a Ten-Minute Rule Bill way back in 1982 to get chronic bronchitis and emphysema prescribed as an industrial disease. He went on to present another four Bills on this subject.
He raised the matter when he was a Member of the House of Commons Select Committee on energy way back in the eighties and has raised many Questions and led many deputations to see various Ministers over the past 20 years in both Houses of Parliament. He has also written and given oral evidence to the Industrial Injuries Tribunal. I also congratulate my noble friend Lady Morgan of Drefelin—I have a job pronouncing English words, let alone Welsh words. She gave a splendid and informative maiden speech and chose a very important subject on which to make it.
I want to emphasise that compensation for bronchitis and emphysema is not a benefit, gratuity or charity given out by the Government, but payment for an industrial injury which has been proved under common law. Miners suffer from this terrible disease mainly because they have inhaled coal dust through their working lives.
I agree with many of the points made by my noble friend Lord Lofthouse about the delays and some of the points made about those who exploit some of the miners. My honourable friend Kevan Jones, Member of Parliament for Durham North, highlighted a few of the cases which happened in the north-east in a debate which took place in Westminster Hall on 3 March this year.
This evening I want to raise a few points with the Minister that have been put to me by miners and their representatives I know personally. The first is the continued unreasonable delay where a revised offer is requested from the DTI when a mistake or an issue is questioned on the original offer. Miners have to wait for a long time for the first offer but there appears to be no clear or definite timescale for the DTI to consider a request from a miner's solicitor or even to respond to it. Sometimes many months or years elapse before a response is received to a revised offer. The result is that everyone is left wondering what has happened with the claim.
I accept that reasons vary in certain cases. For example, there could be a dispute on loss of earnings or a history of smoking. Mostly, this is on crossover claims which occur when a miner has claims under the vibration white finger and the chronic bronchitis and emphysema schemes in regard to the service element. The service element is when the miner can no longer carry out certain household tasks such as do-it-yourself, decoration, window cleaning, washing and maintenance of their cars and gardening jobs.
However, the calculation differs between the two schemes. Under the chronic bronchitis and emphysema scheme, anyone with a disability of 30 per cent or more qualifies for a services entitlement. Under the vibration

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white finger scheme, the services element is dependent on a number of factors, including the severity of the miner's condition identified by examining doctors under a second medical examination called MAP2.
These requests for revised offers are causing a lot of concern. I shall give a couple of examples. A claim was made on 25 February 1998. The MAP examination took place on 8 March 2001. An offer was made on 7 January 2003. A request for a revised offer was made on 5 February 2003. The reason for revision was a loss of earnings/smoking history. Still no reply has been given to those representatives of the miner. They waited a long time for the original offer. They requested a revised offer and it just seems to be hanging in the air.
I shall put a couple of points to the Minister. First, does my noble friend accept that where a revised offer is requested, it should be made within 14 days? If for some reason the DTI cannot respond to that particular request because it has to make examinations of the history, and so forth, it should reply in writing within 14 days giving a clear reason why it cannot make a revised offer instead of leaving the matter hanging in the air with no one knowing what is happening.
The second point I wish to raise is an issue I referred to in a previous debate, which concerns surface workers. The only surface workers who qualify under the chronic bronchitis and emphysema scheme are those who have worked for five years underground since 1954. I consider that if you are working on the surface at the pit you are just as likely to get dust in your lungs as miners who are working underground. It is like saying that people who smoke are the only ones who suffer from lung cancer. People who suffer from lung cancer often do so as a result of passive smoking.
The third point I want to raise briefly concerns the vibration white finger scheme. There are three groups who qualify. Under group one, if you have used pneumatic tools after 1975 for 12 months in certain categories laid out under the agreement you qualify for a payment. Under group two, if you have used pneumatic tools in certain categories laid out under the agreement for 24 months, you qualify for a payment. However, those in group three who do not fall within those categories, and have not used pneumatic tools for 12 or 24 months, get nothing. There is no doubt that in the mining industry, most miners have to use pneumatic tools at some given time. Unlike the shipyards where I spent 35 years, there is no strict demarcation. In the shipyards, only the riveters and caulkers use pneumatic tools. In the mines, most miners are requested at times by their employers to use them.
I hope that my noble friend will take these points into consideration in his reply.
7.56 p.m.
Baroness Barker: My Lords, it is a real honour to take part in today's debate. We have already heard three speeches of superb quality setting out with great eloquence the issues behind a subject which is easy to forget if one lives in certain parts of the country.
I start by paying tribute to the noble Baroness, Lady Morgan of Drefelin, for her informed and moving speech. I remember the time when I was the youngest
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Baroness in the House. My maiden speech was precisely three minutes long. On refection, that was two-and-a-half minutes longer than I needed to say what I knew about the subject. Clearly, the noble Baroness is under no such difficulty. I very much look forward to her taking part in debates in this House, particularly those on health, which will be all the better for her contributions.
I am also delighted to take part in a debate that has been initiated so passionately by the noble Lord, Lord Lofthouse. His reputation on this issue—I believe he has campaigned on it for the past 22 years—is second to none. I have a couple of other reasons for being indebted to him. I was born within sight of Lofthouse Pit. Like the noble Baroness, Lady Morgan, I come from a family of miners and steelworkers. I discovered earlier this year, for reasons I shall come to, that my grandfather died of pneumoconiosis. I did not know that until recently.
I grew up in coalmining areas, and when I went to school, sliding down the pit bings was something school kids did. We knew people's dads who had what we called "the black lung" and what is now called chronic bronchitis and emphysema. I know how debilitating that can be.
The noble Lord, Lord Lofthouse, set out quite starkly the numbers of people who have come within the ambit of this scheme in the past nine years. He quite rightly pointed out that the flaws in the scheme are not in the generosity of the provision on the part of the Government. The problem is in the delivery of the scheme to those who need it. It is important that we in this House raise this matter continually. The way in which this compensation scheme operates has to be revised. Lessons have to be learnt as we go along, for the benefit not only of the miners but of other groups of workers also.
Only last week, Jeff Ennis MP noted in another place that, despite the large scale of the compensation scheme—and it is a huge scheme—solicitors handling claims currently receive an average fee of £2,413 per case, while fewer than half of the miners so far compensated have received final settlements of less than half that amount. Furthermore, more than 3,000 miners have received settlements of less than £200. That cannot be right.
I do not know whether I would use the words "snail's pace", as the noble Lord, Lord Lofthouse, did, but the fact is that, in six years, only 209,000 out of 569,000 claims have been completed, and only 5,000 claims are settled each month. With the available resources—not just the money for compensation, but also the resources put into the clinics and testing centre—that is very slow.
There is also a difference between the offers and the settlements. The noble Lord, Lord Dixon, drew that issue to your Lordships' attention with great clarity. At the end of 2003, there were more than 23,000 outstanding offers, of which nearly 4,000 had been with solicitors for over a year. I believe that the noble Lord, Lord Lofthouse, is right to question the involvement of some solicitors—not all, but some—in the scheme.

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The British Coal respiratory disease litigation solicitors group has been in discussions with the DTI about ways in which settlements could be speeded up. I believe that it put forward a scheme whereby there could be a top-up fee to miners from the solicitors' own payments—which, incidentally, are uprated annually by inflation—in an effort to settle cases more quickly. It is remarkable when solicitors are prepared to forgo part of their fee. If they are so prepared, why are the Government so reluctant to go down the route of having a minimum compensation fee that can be fast-tracked? Anything that would reduce the transaction costs in this scheme must be of great value.
I am sure that the Minister will mention the High Court judgment of Mr Justice Turner in which he talked about the different contributory factors that have an effect on individuals. However, there seems to be something wrong when over-elaboration of a system leads to such long delay, as the noble Lord, Lord Lofthouse, pointed out.
I agree with the noble Lord, Lord Dixon, that the exclusion of surface workers from the case handling arrangements is wrong. Surface workers have eloquently put forward a description of the conditions in which they worked. Miners who worked on screens where coal was washed and graded had to put up with just as much coal dust—albeit not within a confined area—as those who worked underground.
It seems odd that when the medical assessment process—which is so detailed in this scheme—works so well, it is not possible to determine the extent to which those engaged in surface jobs contracted their condition as a result of their place of work. To put it another way, in my layperson's language, if someone who worked all their days at the pithead has the same condition as those who worked underground, surely there has to be a link in the causal factors. I am no medic, but that seems to be obvious.
I return to the issue that the noble Lord, Lord Lofthouse, identified as the most contentious part of the matter—the variation in the charges made by solicitors. In April 2004, in another place, the Minister reported that he had written to solicitors who had charged clients, asking them to repay their fees. Those who failed have been removed from the DTI's list of solicitors. He also reported that the Law Society had agreed that such client charging breached its code of practice. What further action are the Government going to take in conjunction with the Law Society, which is the regulatory body for solicitors, to ensure that such unscrupulous practices are not allowed to continue unfettered?
I have one more question. Claims under the respiratory disease scheme closed at the end of March. To the best of my knowledge, the latest available advice on the DTI website suggests that, after July 2004, a way will be found to facilitate the processing of claims started after the scheme was closed—that is, claims that can be brought only under common law. What progress has been made on finding a way of satisfying those late claims?
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I cannot match the words of the noble Lord, Lord Lofthouse, in his description of those within the scheme who are supposed to benefit from it and who are waiting for help. I simply say that there is a similar condition, asbestosis, the prevalence of which is set to rise within the population over the next 30 years. It will be far more difficult to relate cause and effect in that condition. If we can use what has been learned from this scheme to fast-track those who suffer from related diseases, we will be doing a great favour to others with industrial diseases.
8.6 p.m.
Earl Attlee: My Lords, I am grateful to the noble Lord, Lord Lofthouse, for once again bringing this most important matter before Parliament. He is certainly persistent and, as the noble Baroness, Lady Barker, said, "No one can match his words".
I have still mercifully not yet met a victim of these diseases. I have been down a colliery two or three times and I can understand how these problems have arisen. On checking the index to Hansard, I see that we debated the matter on 16 November 1998. One of the perils for a long-serving Minister is that failure to conclude a difficult matter after six years can come back to bite you.
The noble Lord, Lord Sainsbury, has been at the DTI all this time. I of course have gone full circle and come back to the DTI portfolio. The speakers' list suggested that the noble Lord, Lord Sainsbury, would be responding tonight. In fact, we shall be hearing from the noble Lord, Lord Evans, who will speak with equal authority.
It seems to me that the performance of the Government's machinery is inversely proportional to the number of staff and computers within it. I hope that the same rule does not apply to the DTI's management of this problem. The greatest concern of the noble Lord, Lord Lofthouse, is delay. Six years is unacceptable. But, to be fair to the Minister, not all of the blame can be safely laid at his door.
The noble Lord is also not happy with the progress made by the lawyers. That was a universal complaint and I agree with it. The noble Lord made disturbing revelations about some of the legal practioners—I stress "some". But only yesterday, at Question Time, your Lordships discussed the difference between the ethical codes of the General Medical Council and the Law Society. What is the Minister going to do to help claimants to reclaim illegal deductions when they are ill equipped to do so themselves?
In her excellent maiden speech, the noble Baroness, Lady Morgan of Drefelin, said that she is the youngest Baroness in the House. She should not worry: I think that I am about the third youngest Member on these Benches. If she carries on as she has started, she will be making a major contribution to our debates over many years to come and I look forward to debating with her in full at a later time.
The noble Lord, Lord Dixon, illustrated some of the difficulties faced by claimants, not just those with miners' respiratory illnesses but also those with vibration injuries. The Minister will say that the

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availability of funds is not a problem, but what financial provision has been made for the DTI for these claims this year and next year?
During the 1998 debate, my noble and learned friend Lord Mackay of Drumadoon identified differences between the Scottish and English legal systems. How are Scottish miners' COPD claims being dealt with and what progress is being made there? Does the Minister have any responsibility or is that the responsibility of the Scottish Executive?
During the 1998 debate, there was much talk of the lack of capacity to undertake the medical assessments and we talked about it a little tonight as well. Where are we with this process and how many claimants are yet to be assessed?
I cannot help but conclude that a lot of people have been earning their living, or at least part of it, from these claims. First, we have the lawyers and, of course, the longer a case runs, the more chargeable events are likely to occur. Your Lordships know how much a solicitor's letter costs. On top of the official plaintiffs' solicitors groups there are others seeking to advise claimants.
Secondly, is there any incentive for DTI officials and the IRISC to conclude this matter? Can the Minister say how many officials at the DTI and IRISC are working on these problems? What incentives are there for individuals at all levels in the department to conclude this matter? This is a sorry tale and one to which I did not expect to have to return six years later.
8.11 p.m.
Lord Evans of Temple Guiting: My Lords, I congratulate the noble Baroness, Lady Morgan, on her excellent maiden speech. She has a remarkable record in charity work, especially in health. It is a record that makes her so effective an advocate for those with chronic and acute conditions. After hearing her excellent maiden speech today, nobody can doubt that she will contribute a great deal of knowledge and judgment to debates in your Lordships' House. I congratulate her again.
In the absence of my noble friend Lord Sainsbury, it is a particular pleasure for me, for a number of reasons, to reply to this short debate on behalf of the Government. My father was born in a mining village in South Wales and wrote extensively about the plight of miners. Just before I arrived in your Lordships' House, I chaired a quango that advised government on museums. One of my favourite museums was, and is, the National Coal Mining Museum in Wakefield where the oral history of miners and their families vividly illustrates the harshness and ill health that was the miner's lot. Also, by coincidence, last year I read the excellent autobiography of my noble friend Lord Lofthouse, A Very Miner MP. That is a terrible pun but it is a very good book that I commend to any noble Lord interested in the mining industry.
I thank my noble friend Lord Lofthouse for securing this debate and for continuing to keep in the public eye this issue of great human importance. As a general comment, I have heard nothing this evening with which anybody in the Government would disagree. There are
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huge administrative problems to be solved but I hope that, in the course of the next few minutes, I shall be able to give noble Lords reassurance that we are tackling these important problems.
When the Government assumed responsibility for the former British Coal's health liabilities in January 1998, they acquired not only a legal but also a moral commitment to ensure that former miners and their families receive 100 per cent of their rightful compensation as speedily as is humanly possible. That is the intention.
As my noble friend is aware, there are two schemes, which cover respiratory and vibration-related diseases respectively. The vibration scheme closed for live claimants in October 2002 and in January 2003 for deceased claimants. The respiratory scheme closed at the end of March this year. The Government and solicitors carried out two highly successful advertising campaigns between 2002 and 2004, prior to the closing dates, which resulted in almost 570,000 claims having been fully registered under the respiratory disease scheme, with some 316,000 claims being received in the last six months of the scheme alone. That is a first clue to the administrative problems that we are facing. In addition, some 170,000 claims were registered under the vibration scheme before it was closed last year. They form the largest personal injury schemes ever in the UK, and possibly in the world, as we heard from my noble friend Lady Morgan, with more than 413,000 individual payments amounting to more than £2.2 billion made to date across both schemes to former miners, their widows and families.
Following the closure of the schemes, claims are still being accepted but these will not be able to go through the schemes. Instead, claims will be processed, as we have heard from the noble Baroness, Lady Barker, through the personal injury courts. Both High Court judges who oversee the schemes have agreed that that is the appropriate procedure for handling claims that were not registered prior to the extensively advertised scheme closures. Since the closure of the respiratory disease scheme, fewer than 200 claims have been received.
The question that is most asked in the former coalfield areas, and in your Lordships' House today, is: when will the last claim be settled? I am aware that at the current rate it could take more than seven years—my noble friend Lord Lofthouse says 10 years—to process all the claims registered under the scheme. The Government do not believe that that is acceptable, which is a view that has strongly come through from noble Lords today.
In order to reduce that timescale, the DTI is working with the claimants' solicitors to try to streamline the process. Using information gathered from claims processed to date, the parties are looking at whether a way can be found to simplify the processing of claims and to give claimants the opportunity to exit the scheme at an early stage with a fair settlement.
If successful, that approach would have the potential to shorten the scheme by several years. Currently, the DTI and the claimants' solicitors are holding detailed

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discussions on this issue and plan to report, as we have heard, to Sir Michael Turner, the judge who oversees the respiratory scheme, later this month when he visits the DTI's claims' handlers. The department is already taking steps to shorten dramatically the timescale of the scheme. In our view, the public inquiry asked for by noble Lords would simply divert resources and delay things further. The scheme is not overseen by only Mr Justice Turner, but by a ministerial monitoring group that was set up in 1999 by Helen Liddell, the then Energy Minister. The group is made up of mining union officials and Members of Parliament.
The Government are aware of the huge responsibility that the liabilities are, and the DTI continues to review the levels of resources employed on the schemes. The noble Earl, Lord Attlee, asked about resources within the DTI. There follows a few figures: IRISC, the DTI's claims' handler, has increased its staffing levels from 300 in 2000 to more than 1,300 now. In addition, the DTI, through its medical service provider, is employing around a third of the respiratory specialists in the country on the scheme. The Government are aware that many solicitors are also reviewing their level of resources to ensure that claims are settled quickly.
There have been some discussions between the parties in relation to a minimum payment for claimants. As my noble friend is aware, those low-value offers reflect the original 1998 High Court judgment, which discounts for issues such as smoking. Noble Lords may wish to know that at a recent meeting a member of the solicitors' group stated that it was appreciated from the onset of the scheme that very low offers would be produced and it would be a natural consequence of a scheme that could compensate for only one-day underground. The DTI has therefore rejected calls for it to fund a minimum payment because most low-value offers are accepted and most outstanding offers were for chronic bronchitis, which attracts less compensation because—to be brutal—it is non-disabling. I am also informed that it would divert resources away from making and settling new offers.
The noble Baroness, Lady Barker, mentioned that the claimants' solicitors have put forward a proposal whereby claimant representatives would fund a minimum payment from their fees to the value of £500. The DTI is in discussion with the solicitors with regard to that proposal, in particular to establish that there will be the necessary full take-up of any minimum payment by all claimant representatives. It would clearly be unacceptable for there to be inequitable treatment between different claimants depending on the solicitor handling their claim.
To date we have paid solicitors over £300 million to process claims under the coal health schemes. The majority of those firms have taken the tariffed costs paid by the Government. However, as we have heard, a minority are unethically and immorally taking a percentage of a claimant's compensation in addition to that paid under the agreements, a point powerfully made by my noble friend Lord Lofthouse's example.
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Nigel Griffiths wrote to over 700 firms of solicitors handling claims under the coal health schemes asking them to confirm that they were not taking a cut from claimants' compensation and, where they were, that they would immediately confirm that they would repay any such deductions. Over 500 firms responded. The Minister also wrote to the Law Society of England and Wales asking it to ensure that those firms that are charging not only make repayments to clients who contact them, but that they proactively review all their files and repay every individual from whom they have made a deduction. The Minister also passed the names of all the firms yet to respond to the Law Society asking it to take urgent action to ensure that the firms comply with the request.
I should also say that the Law Society wrote to all firms that have handled claims for compensation under the DTI's scheme advising them of the society's policy and reminding them to review all the cases they have handled and to repay any money that was inappropriately withheld from miners who have won compensation. Two hundred and sixty complaints have been received by the Law Society, of which 123 are from MPs on behalf of constituents. To date the Law Society has closed 182 matters, which leaves 78 outstanding. Of the 78 outstanding, 53 are complaints received from MPs.
Of the 182 closed matters, the Law Society has been able to conciliate 84. The other 98 have been closed for a variety of reasons: because the claim is still on-going; the complaint has been withdrawn; the complainant did not wish to take any further action; the matter was resolved without assistance; the solicitor's explanation was accepted by the complainant; or no deductions were in fact made.
A total of £69,726 has been recovered for complainants. However, the actual figure is likely to be more because the society has been able to conciliate complaints through obtaining a refund of fees where it has not always known how much was involved. The amounts recovered have ranged from £11 to approximately £9,000. About half the refunds involved amounts below £1,000, but there have been 16 instances where sums of over £2,000 have been involved.
Those miners who worked purely on the surface were not covered by the High Court judgment. The DTI's expert medical advice is that respirable dust levels on the surface of coal mines were insufficient to cause chronic obstructive pulmonary disease—COPD—in the majority of cases. My noble friend Lord Dixon disagrees with that view, which is something that we will consider. Surface workers' claims for COPD cannot therefore be paid on a schemed basis under the claims handling agreement for respiratory disease. However, Nigel Griffiths permitted the miners' solicitors to have access to British Coal archives in order to assist them in finding evidence to support their case. Following the latest court hearing on 13 July the solicitors have been ordered to identify lead cases and to present them to the judge in advance of the next respiratory disease court hearing on 4 and 5 October 2004.

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Claimants can of course pursue a claim for compensation in relation to surface employment under common law if they wish.
Some miners worked for a group of smaller mines and I know that negotiations on this issue have been difficult and protracted. However, following mediation and negotiation, the claimants' solicitors and the small mines' representatives have been able to resolve their remaining differences. As a result, the small mines will now be included within the terms of the claims handling agreement. The DTI is currently working with the other parties and with its claims handlers, IRISC, to put the settlement reached into operation. As a result of this settlement, small mines' claimants should be able to move from interim payment to full and final settlements.
As to those claimants who worked for UK Coal, the DTI has previously agreed to UK Coal's terms for signing up to the claims handling agreement. However, the claimants' solicitors and UK Coal continued to have issues on which they could not agree. The judge allowed them until the hearing on 12 and 13 July to continue negotiations, after which time, had they still not agreed, he would give directions for litigation.
The parties announced at the July hearing that they had reached an agreement in principle. This is yet to be ratified and the DTI's legal advisers are currently examining the details to ensure that the agreement does not change the DTI position. When all parties are satisfied, then the operational work can begin to produce full and final offers for claimants in this group. In the mean time the DTI cannot calculate either the overall amount of recoverable compensation or how that is to be divided between the DTI and UK Coal, and so cannot pay out its own share of the liability independently.
The Government are of course aware of the concerns that this whole process has caused. Many have been referred to today. A lot of stories have been circulated which have misled ex-miners and their families, such as there being a cap on the liabilities and that the Government are waiting for claimants to die in order to reduce the levels of compensation paid.
We see it as one of the Government's main responsibilities to ensure that we meet our commitments as speedily as possible and that we limit to an absolute minimum the distress caused to those who are entitled to compensation. With the assistance and the co-operation of all the parties involved, this can be and will be achieved.
In the two or three minutes remaining, let me answer some of the points raised in the debate. It may be that I shall have to write to noble Lords.
Lord Lofthouse of Pontefract: My Lords, before the Minister sits down, perhaps I may congratulate my noble friend on an excellent maiden speech. I have today felt somewhat sad during the debate because some of our colleagues who have always taken part in these debates have unfortunately passed away—notably, Peter Hardy. We miss them very much.
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Let me make a couple of points in the time available. First, how does the £300 million already paid to solicitors compare with what has been paid to the miners? Secondly, and I shall finish on this point, the noble Earl, Lord Attlee, said that he had not seen victims of this disease. I occupy the chairmanship of the Mid Yorkshire Hospitals NHS Trust. If the noble Earl is in my area at any time, I will gladly take him and show him some of these victims fighting for life in hospital: you cannot live without oxygen.
Lord Evans of Temple Guiting: My Lords, the noble Lord, Lord Dixon, raised a point about the fact that most miners use vibrating tools and that the VWF scheme does not take account of this. I understand that this is a highly emotive issue. The VWF scheme has an occupational group procedure so that those claimants who were not obviously exposed to vibration on the basis of their occupation can establish a case for compensation by gaining the support of witnesses to show that they were exposed. This is a very difficult and contentious area, but it is important that the Government ensure that compensation goes to those who are entitled to it. Although these claims are difficult to assess, they make up less than 10 per cent of all the remaining claims.
My noble friend Lord Dixon made a point also about revised offers. Revised offers are dealt with as efficiently and speedily as possible. A number of issues are still under discussion and are delaying full and final settlement. Issues such as crossover are close to resolution. Wherever possible, the interim payment is made. Solicitors are kept informed of all progress on outstanding issues. To respond to a large number of queries about individual claims would cause further delay.
Given the time, I shall arrange to write to my noble friend Lady Morgan, the noble Baroness, Lady Barker, and the noble Earl, Lord Attlee, about the interesting points that they raised.

Housing Bill
8.32 p.m.
House again in Committee.
Clause 141 [Other duties of person acting as estate agent]:
[Amendments Nos. 193A to 194 not moved.]
Lord Rooker Lord Rooker moved Amendment No. 194ZA:
Page 97, line 23, leave out "a view to" and insert "the intention of"
On Question, amendment agreed to.
The Earl of Caithness The Earl of Caithness moved Amendment No. 194A:
Page 97, line 26, leave out "or may become available"
The noble Earl said: In moving the amendment, I shall speak also to Amendment No. 194B. This is a small but important amendment which would allow estate agents to mention to potential buyers properties which may become available for sale, but which are not yet on

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the market. We touched briefly on the matter yesterday, but it needs to be looked at again in a little more detail, because it is still unclear at what point a property is deemed to be on the market and a home information pack necessary. We discussed various scenarios that are not classified as marketing; for example, if one was at a dinner party with friends or if one happened to say that a property might become available. The noble Lord, Lord Phillips, asked what would happen if someone indicated that a property might become available at an auction.
The amendment would make it clear that an agent can mention to potential purchasers that a property may become available in the future. I beg to move.
Lord Rooker: The noble Earl is right to raise the matter again so as to clear up any doubts about it. Clause 141 imposes a duty which affects only estate agents and which applies where some kind of marketing activity takes place that is too limited to trigger the duties imposed by Clauses 137, 138 and 140. That duty is to have a home information pack available when a qualifying action is taken. A "qualifying action" is defined as an action taken with a view to marketing, or, following your Lordships' acceptance of Amendment 194ZA, with the intention of marketing. Such an action communicates the fact that a property is, or is about to become, available for sale, but does not put it on the market or make public the fact that the property is on the market.
It may help if I give a practical example of the sort of situation this clause is intended to deal with. An estate agent is instructed to sell a property. Before marketing starts properly—that is, before the "For Sale" board is put up and adverts are placed in newspapers—the estate agent tells a potential buyer on his list that a property he, the buyer, is likely to be interested in is about to go on the market, and invites him to make an early appointment to view. In this example, the property may not be on the market as defined by Clause 131. That definition provides that a fact is made public when it is communicated with the intention of marketing to the public or to a section of the public. In the example I have mentioned a communication with one individual may not be with a section of the public, but would clearly be an action aimed at marketing that ought to trigger the home information pack duties.
Without the provision, estate agents would be free to engage in pre-marketing activities that would amount to marketing in all but name. By deleting the words "or may become available for sale", Amendment 194A would have the effect of allowing an estate agent to tell a potential buyer that a property was about to come on the market, with a clear view to marketing it but without triggering the associated duty to have a pack.
It is important for me to stress that those duties are only triggered when any communications are part of a direct attempt to market the property in question. An estate agent is not in breach of the duty if, for example, he or she remarks to a spouse or a colleague that a particular property is going on the market. This would
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not be a "qualifying action" within the meaning of Clause 141, provided the communication was not aimed at marketing the property.
I give another example. An estate agent is seen at a property that is not yet on the market, and is asked whether it is up for sale. If he were to answer truthfully and say, "Not yet, but it will be as soon as the home information pack is ready", that would not be a qualifying action either. There is a difference between knowing information and actually marketing to the public. It is self-evident.
Amendment No. 194B would delete subsection (3)(b) of Clause 141, which provides that a qualifying action for the purpose of this clause is an action that falls short of putting the property on the market. I have already explained that the whole purpose of Clause 141 is to capture an activity that, while amounting to it, does not meet the definition of "marketing" set out elsewhere in the Bill. I hope it is clear to the noble Earl, as a professional in the property field, that it is quite obvious whether one is making a communication with a view to marketing the property for sale, or just having a chat about it in the office or at home. The two things are quite different, and hopefully professionals will be able to tell the difference between the two.
The Earl of Caithness: I am grateful to the Minister for the time and trouble he has gone to in responding to my amendment, and I will read what he says with care. However, I am sure he would agree with me that the tighter one legislates in this area, the more difficulties will be created, and the more the unscrupulous will twist and bend the rules for their own potential profit.
Defining it in the way explained by the Minister creates a huge grey area over when a property is on the market. A potential vendor seeking to put his house on the market in due course invites four different estate agents to look at his property. I do not know whether I will get instructions, but I do know that the property is going to come on to the market. I know also that the noble Lord, Lord Rooker, is on my client list and might be on the list of the noble Lord, Lord Borrie, as well. But given that the noble Lord is a good mate of mine, I shall ring him and tell him about the property. I say that I do not know whether I will be instructed, but I know that the noble Lord is looking for a property and has made an offer on a house that is his second choice. In such an area one is not quite certain whether or not one is marketing a property if, five minutes after I have spoken to the noble Lord, Lord Rooker, the vendor rings me to give me instructions.
As I understand the legislation, I would have got away with telling the noble Lord, Lord Rooker, about that property. Five minutes later, however, I could not have done so. That kind of situation represents a grey area that will result in endless disputes. It is something we must come back to because it is not right. It is not helpful to the profession, to vendors or to purchasers.
We have passed the stage of trying to get around the home information pack. If one accepts that we are to have home information packs, it is then the ability to get out there and tell someone that something is going to

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happen which is still uncertain. People are very keen to buy at the moment. They might not be so keen to buy in three months' time and that will be a different market. However, this is an area where there is a potential for conflict and potential grounds for court actions. That is not helpful to the smooth running of the market.
The Minister has given a full reply, but I think that he understands my point.
Lord Rooker: The noble Earl has given an interesting and wholly practical example, and I shall be more than happy to take advice. He would be in trouble only if he had rung me after receiving the phone call to take instructions. Once he had taken instructions, that was it: he would then have been responsible for the marketing of the property. Tipping me off beforehand is not marketing because he had not been told by the vendor that he was the estate agent and I would not know anything about the vendor.
However, situations will arise where three or four estate agents could be seen in the street taking photographs of the same house and walking in and out. It would be obvious to the neighbours that something was afoot. I have said that we want to cover this 100 per cent, but the world is such that you do not cover 100 per cent for the very reasons given by the noble Earl. However, he has asked an interesting question that in due course will receive an answer.
The Earl of Caithness: I am again grateful to the noble Lord for his further full response. This is certainly one of the areas that we will come back to on Report. We considered it yesterday and have done so again today, so I know that it is a matter of concern to many noble Lords. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 194B to 195ZB not moved.]
Clause 141, as amended, agreed to.
Clause 142 agreed to.
Baroness Hamwee Baroness Hamwee moved Amendment No. 195A:
After Clause 142, insert the following new clause—
"INCOMPLETE PACKS
A property may be marketed with an incomplete pack in circumstances where reasonable efforts have been made to obtain the missing information."
The noble Baroness said: This amendment provides that a property can be marketed with a pack that is not complete where reasonable efforts have been made to obtain the missing information that would make it complete. By and large, we have not moved again from these Benches amendments that are identical to those moved by our colleagues in another place. This amendment is a duplication, and we have tabled it because the Minister stated in another place that he fully
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appreciated the sentiments behind the amendment and that it would be unreasonable not to take them into account. He ended by saying:
"We will now consider"—
the matter—
"further, in consultation with industry and consumer stakeholders".—[Official Report, Commons Standing Committee E; 10/2/04; col. 573.]
We are moving the amendment in order to hear the results of the Government's consideration. I beg to move.
Lord Rooker: Amendment No. 195A would provide that marketing could go ahead with an incomplete pack in cases where reasonable efforts had been made to obtain the information. We share the noble Baroness's concern on the issue. I can assure her that regulations to be made under Clause 144(9)(a) will achieve this effect without further amendment to the Bill.
Baroness Hamwee: I am grateful for that. When we see the draft regulations such amendments will not be necessary. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.45 p.m.
Baroness Hamwee Baroness Hamwee moved Amendment No. 1958:
After Clause 142, insert the following new clause—
"Residential properties in disadvantaged areas
The duties under sections 137 to 140 do not apply in relation to residential property in disadvantaged areas."
The noble Baroness said: This amendment excludes from the duties under Sections 137 to 140 residential property in disadvantaged areas. It is commended to us by the Law Society, which says that the term "disadvantaged areas" is found elsewhere in legislation. It has been defined for the purposes of special stamp duty exemption. Noble Lords who live in certain areas south of the river but close to Westminster will be aware of the special stamp duty exemptions.
The Secretary of State may seek to make regulations in respect of low value properties in areas of low demand where the cost of the pack preparation is a disproportionately high value of the property. At the other end of the scale it is suggested that standard home information packs will be wholly inadequate for large or unusual properties. In this case I am seeking to draw the Minister's attention to the lack of proportionality where the property is of low value. Rather than pointing to the individual property, this is a similar blanket exemption drawing on the analogy of the stamp duty provision. I beg to move.
Lord Rooker: I understand the reasons why the amendment has been moved. I cannot accept it, but I believe that I have a reasonably positive answer. If it is considered necessary, it has always been our intention to make special arrangements for sales of low value properties in low demand areas in regulation and not on the face of the Bill. This could be done under

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regulations made under Clause 143, which enables the Secretary of State to provide for other exceptions from the home information pack duties.
Alternatively, we believe that the regulation-making power in Clause 144 enables the Secretary of State to tailor the contents of the home information pack. This power could be used to make different provisions for different areas and different descriptions of property. The noble Baroness spoke very briefly, but it is important to put this on the record.
The amendment concerns the effect that home information packs could have on the sale of low-value properties, particularly properties suffering from low demand. People based in the south-east, the London-centric people, have difficulty getting to grips with the idea of low demand and falling prices. I can assure them that in parts of the north-east and north-west that is indeed the situation. It was a matter of some concern in the Homes Bill, which was before Parliament before the last general election. We promised to consult further on that important issue.
Since then, we have commissioned further and more detailed research and consulted on a range of options for addressing any problems that these proposals might cause for sellers in low-value, low-demand areas. The consultation paper and an independent report on the outcome of that consultation have been made available to the Committee.
This is a difficult issue. I know I shall be asked on what date and when it was deposited, but no doubt I shall find out before I sit down. I can assure the Committee that it is not a secret document. We need to strike a balance between, on the one hand, any disproportionate effect of introducing compulsory home information packs for very low-value properties I am talking about properties that are sometimes bought and sold in pubs for less than £5,000 in the north-east—and, on the other hand, the need to avoid stigmatising the properties or the area even more than they are now. We also want to avoid creating anomalies and denying the benefits of the pack to buyers who may be particularly vulnerable in the absence of good information about the home that they are buying.
It was certainly the view of the researchers that the Government should not make special arrangements for sales of low-value properties. That was also the view of the majority of those who responded to the consultation exercise. If the Government were to intervene, the best option was felt to be a cash limit, so that those sales below a prescribed amount would be exempted from some or all of the home information duties.
Interestingly enough, the option that found no favour whatever was one that would have attempted to define areas in which different arrangements for low-value sales would apply. That would rule out, for example, the housing market in all Pathfinder areas, the nine areas of the country that are well defined on maps. People who live in those areas know that not all
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properties are low-value and low-demand properties, but they are the most difficult places in the country. If anyone thought of doing that it would be ruled out.
In view of the outcome of our research and consultations it would not be appropriate to put an exclusion on the face of the Bill. We want to do the right thing for those who live in areas where the housing market is not functioning properly. We shall consider all views before deciding whether it is appropriate to make special arrangements in regulations for those properties.
We have heard the speech of the noble Baroness—I do not criticise it but she did not address some of these issues. The next sentence in my brief, which I am almost reluctant to read out bearing in mind the constraints that we are under, says that I shall report back to my right honourable friend the views expressed in the debate on this amendment. It is no good if the noble Baroness expresses no views and I am the only one to do so. In other words, we have addressed the issue.
There has been some research and consultation on the matter which has steered us away from what would be a seductive solution for people with whom we do not want to be disproportionate and heavy-handed, but we do not want to make matters worse than they already are by stigmatising a particular area. If we come to some arrangements, there is capacity in the Bill to do that in regulations. The probable way through would be to put a cash limit on it, so that homes marketed at less than a certain value would have a different set of rules.
This is a very difficult issue. We are talking about people's homes. People do not like being told that they live in low-value, low-demand areas, but they know when they do. When there is large-scale abandonment of properties, street by street, it is a very serious situation. The Pathfinder programme is beginning and, as I say, it really only started full operation this year. We have announced the early funds to eight of the nine areas—the final one will probably be settled before the end of the year. They were levering much more money than we are allowing them, but it is not a five-minute programme. It is not even a five-year programme in some cases. We have to deal with that. But people are buying and selling homes in these areas and we have to take account of that fact.
The unusual thing about the market renewal pathfinder programme is that it is the first time that I can recall any housing renewal programme having as a policy objective the aim of raising the value of properties in the area. Nor did that happen with any schemes that I dealt with for my former constituents—whether it was housing renewal areas, housing action areas or urban regeneration areas—although that may have been a spin-off of those schemes. But one of the avowed policy objectives of the housing market renewal programme is to raise values in the area, restoring the equity and giving people the confidence to invest in those areas and to recreate those communities.

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Obviously there is a massively complex programme of work to be undertaken. While that is happening, we do not want to cause any stigmatisation by putting a red line around those areas. Therefore we will look at this matter as it is a serious issue. As I said, I welcome any comments on the matter.
The Earl of Caithness: I am grateful. I will take up that offer. Seldom does one get an offer like that from the Minister and when one does one cannot resist it.
I raised the question of low-value homes on Second Reading of the Homes Bill on 28 March 2001, (col. 351 of Hansard). Could the Minister tell us more about what is in his mind with regard to regulations? He is going to create two tiers of market, anyway. If one has a different set of rules for a property below a certain capital value, one has a two-tier market and stigmatisation for that bottom tier. I agree with him that it is a very difficult problem to get right. The Government have set themselves on this course and they have to get themselves out of this hole.
When the Minister talks about a different set of rules, is he talking about not having a home condition report, or not having a home information pack? Will it be entirely voluntary? Will it be a partial home information pack, or a partial home condition report? We have to look at the situation of not just the low-value home but of a bad market. If it will be difficult to sell a house in good condition in that market, it will be even harder to sell a house of low value that is not in good condition. If that house is not in good condition and there is not a home condition report on it, the problem that the Government are creating gets more intensified and magnified.
I ask the Minister to tell us a little more about this matter as it is an area that we ought to be able to debate. It is fine for the Government to say that they are thinking about the matter and that they will produce regulations, but for people in such a house there is probably another problem: they may be living on very low incomes. If they had a better income they could move. There could be horrendous problems—low capital value, low income, a bad market and a whole lot of costs imposed on them by the Government before they try to sell their house. If the house does not sell, how can they afford to move? There is no way that they can do so; if they could, they would be out of that house. Can the Minister tell us more about that situation?
Lord Greaves: Does the Minister want to answer?
Lord Rooker: No, because I have not got an answer. I invited the thoughts of noble Lords. Some of the issues raised by the noble Earl are the very matters that we will have to consider. We are in listening mode having done some research and consultation. First, we have not said that we will proceed. I said that if we choose to proceed we would probably go for the monetary value rather than a geographical designation because of not wanting to black list an area.
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Secondly, we would come up with some other form, which could be a variation on the home information packs. One can think of several variations, some of which the noble Earl touched on, to lessen the burden so that it is proportionate to the issue relating to someone who has a low-value property to sell.
9 p.m.
Lord Greaves: I congratulate my noble friend on raising the issue as it is important, although I am not sure that the amendment is the way to deal with it. Nor am I sure how far areas of disadvantage—I am not certain what they are—coincide with the market renewal Pathfinder areas. There must be some areas of disadvantage and very low house values that have not been designated as part of the Pathfinder areas, That is bound to be the case; it may be pockets here and there, or may be larger areas. If something is to be done, it is important that it not be available only to the Pathfinder areas.
As I said yesterday, I look at the matter from the point of view of the east Lancashire Pathfinder area in particular, which I know quite well. I do not live in it, but I live almost within spitting distance of its boundary. As the Minister said, it is a very important project. Such areas will sink or swim by its success, at least for the next 20 years.
I am not too concerned about stigmatising areas that have already been defined as having a problem of low demand and low prices. An example would be someone who lives in an area such as Burnley Wood in Burnley. I do not know whether the Minister has been there, but some of his colleagues certainly have, and they were all astonished to learn that they could buy whole long streets for five-figure sums—every house in the street. People would have grabbed their hands and said, "Thank you very much", because no one else will pay a penny for them. Such areas are extreme examples of a problem, and extreme within an area such as east Lancashire.
It is clear that, in such areas, the cost of producing the housing information packs could be a bar to even selling a house at all, because it would be a relatively high proportion of the total cost. The matter needs to be looked at. However, particularly in Pathfinder areas throughout the country, if there are to be different rules for cheaper houses, it is important that they be made in a way that is seen as part of the overall package of what is being done in those areas.
By that, I do not only mean the overall programme to stimulate the housing market there; in some of them it is being stimulated already, simply by the fact that they have been declared Pathfinder areas. In some of them at least, including parts of east Lancashire, house prices are going up at an astonishing rate, which appears to be at least in part a response to the fact that they will be such an area. We say that we are going to stimulate a market and—markets are funny things—sometimes that in itself results in the market being stimulated. However, there are still lots of housing problems there, such as the empty and run-down houses and the areas that need refurbishment, into which we hope that the investment will go.

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There would be no harm in tailoring what is done in Pathfinder areas at least as part of the package. I do not know whether we could have different rules for different parts of the country but that might be a good idea in the Pathfinder areas, which are being targeted specifically.
I want to echo what the noble Earl said—people are buying the properties. Perhaps he did not say that; perhaps the Minister did. It is important that those people have the same protection as people in other places. They may buy properties as owner-occupiers, or may take advantage of a new generation of housing grants being made available in some of the areas to revive them. If people are doing that, there will be a lot of investment in those houses. They should be thought of as being potentially higher-value houses, although they might still then be sold for between £40,000 and £70,000. People in London might still think that incredibly cheap, but those of us who know the areas well and see some such prices being achieved think the way that they are going up extraordinary. In order to help the sellers, we should not be forgetting the buyers.
In other cases, where the houses are now being scheduled for demolition, it is important that people from other areas—perhaps from the south of England who think they are dirt cheap—should not be buying them on the Internet or in any other way and ending up with houses which will then be taken off them to be knocked down. Again, it is important to think that the full information is provided as in other areas.
The Minister's comments in relation to this were interesting. They and the Government's approach seemed to me to consist of a great deal of common sense
Lord Rooker: I am grateful to the noble Lord, Lord Greaves. He is right that the mere announcement of a board, the publication of prospectuses and the plans, the injection of the seed-corn or start-up money and the gearing of other moneys has already had an effect. Even people who have speculated would, in the normal course of events, be annoyed. However, it is recreating what disappeared—a functioning housing market.
If one is London or south-east centric, it is difficult to grasp the scale of what is happening—and not only in the Pathfinder areas. Not all the Pathfinder areas are incredibly low-demand and abandoned—there is one in which that is not the case—and the geographical approach would not be the right way forward, for reasons I have given.
I will make a final point. The whole Bill is a consumer protection measure. If we made special reasons or regulations which exempted some or part of the home information pack system, we would not want to reduce the protection for the buyers and the sellers. That would be against the grain and quite unfair. People might be buying a low-value property, but they would be entitled to have the consumer protection back-up in so far as we can provide it so they are not
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materially disadvantaged. That is a point we will take on board and I am grateful for what the noble Lord said.
Baroness Hamwee: I, too, am grateful to my noble friend for his thoughtful contribution. At the beginning of my comments, I mentioned London to see whether I might spark a little recognition from some people. I know they live in the areas that are, as the Minister put it, red-lined for the purposes of stamp duty exemption. We have red-lining and designations for that, for selected licensing—when that is enacted—and for the market renewal Pathfinder barriers.
Not long ago, I, as executor, sold a flat which had belonged to my uncle in Salford. It eventually sold for something like £25,000, but it took about three years. I wonder what I would have done if I had had to produce the home condition survey and so forth and then keep on renewing it. It was enough putting in new carpets, a new kitchen and so forth to make it look more attractive. Commonsense issues are involved.
I might have taken the flat off the market and let it sit empty. But I probably would not have because I would have felt desperately uncomfortable about it. It goes against all my instincts about using property. I am sure that the Minister understands.
When the Minister was talking about the Pathfinder areas, my noble friend Lady Maddock asked whether the Government had considered using Pathfinder money to pay the cost of these packs. That is another comment that the Minister can take back to his right honourable friend. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 143 agreed to.
Clause 144 [Contents of home information packs]:
Baroness Hanham Baroness Hanham moved Amendment No. 196:
Page 98, line 19, at end insert "; and
( ) the core elements of the pack which must be made available before any marketing of a residential property may take place"
The noble Baroness said: This amendment would place on the Secretary of State a requirement to make regulations relating to the key parts of the pack that must be made available prior to, or at, any marketing of the property. Again, it is made against the background that we do not think that the packs should necessarily be available on day one. However, it is a situation that might arise.
The amendment should be taken in the context of the other amendments. To touch briefly on the marketing aspects of this matter, it may be the case that the property is marketed in one way or another some time prior to the detailed negotiations commencing. Of course, marketing a property does not mean that the property will necessarily be sold.
It is also vital that a person who wants to market his property is able to do so as speedily as possible. It should be the case—the Minister, who has temporarily left his place, has said that he would expect it to be so—that many of the packs will be available within four or

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five days. I think that most of us consider that that will be a triumph of hope over what will become experience, but it should be possible to organise a pack within two weeks. That will happen only if information is held by local authorities and made available on-line and if the home condition report can be carried out in the shortest possible time, which will possibly not be the situation to begin with. Therefore, if someone is to be able to market a property without a pack, there needs to be a sharper definition of what constitutes marketing.
There may be a legitimate reason why a piece of information for the pack cannot be readily obtained, and it seems to us wrong to hold up the marketing of a property in such cases. However, it would seem sensible that a set of core information should be included in the pack before any property can be marketed—for example, applications for searches, terms of sale and the seller's property information, all of which will probably be available quite quickly, as it certainly should be under e-technology. But other aspects may not be quite so easily obtainable.
I think that this is an area which is worth discussing and considering in the light of the marketing aspect. For most people, the marketing will be delayed in any case by the necessity to get information into the packs, and that has the potential to hold up a sale substantially if a property cannot be marketed without all the elements of the pack being available. I beg to move.
The Earl of Caithness: I support everything that my noble friend has said but would add one thing, which I mentioned yesterday. I refer to the case of leasehold properties—flats—and the difficulty of obtaining information from managing agents. I re-read what was said yesterday and I think that we still need to address this problem.
The unavailability of such information is often one of the factors that delays the sale of a flat. If one does not obtain it from a managing agent for whatever reason, the property must still be allowed to be marketed. It penalises the occupier or tenant of that flat unreasonably if he has to wait for all the final details. He may obtain some information from the managing agent. The managing agent may be able to tell him what repairs were done last year but he may not be able to say what repairs were done the year before or the year before that. He may not be able to tell him about the sinking fund. There may be information that he cannot give readily about the future expenditure plans, other than normal repairs and maintenance, but he may not be professional enough to have the whole schedule readily at his fingertips or, indeed, he may not have obtained that information from the owners of the property or the tenants' association. Therefore, many areas are involved in what my noble friend says and there must be a time at which one can get on and begin the marketing process without the full information being available.
9.15 p.m.
Lord Borrie: Clause 144 is important and entitles the Minister to make regulations specifying what documents and what information should be in the home information pack, which we have now been discussing in one form or another for some time. It is obviously a vital provision of this part of the Bill.
We all know that regulations can be changed from time to time. If, following certain trends of thought from those who have spoken so far, the Government were too ambitious in their requirements in regulations as to what should be in the home information pack, that could be altered. However, it seems to me that if one introduces this core element, which is the phrase used in the amendment tabled by the noble Baroness, that is a subtlety too far. I notice that Opposition Members through this Committee stage have been talking about the dangers of over bureaucratising the Bill and the provisions and therefore getting into legal and perhaps litigious arguments as to what is meant. We are introducing, it is suggested, the phrase "core elements" when, as I say, the Government have every ability and opportunity under this clause to say what they want and what they do not want and, indeed, to alter that assertion from time to time if they feel that they have required too much or too little in the home information pack.
Either noble Lords are seeking too much subtlety or this is, I fear, yet another way of trying to reduce the number of things that should be given to enable the buyer to make a sensible decision as to whether to make an offer after the property is marketed.
Lord Phillips of Sudbury: This is obviously a hugely important practical matter and any conveyancer will say that it is. Could not the answer to this amendment—indeed, it is similar in intent to Amendment No. 195A moved by my noble friend—be for the Government to commit themselves to early consultation with the Law Society and the Royal Institution of Chartered Surveyors to ascertain from them the timing for the production of different documents in the pack, given that Clause 144(9)(a) already permits the Government to prescribe different times for the production of different documents.
I think that we are all batting on the same side here but I suspect that we want some reassurance that the Government are fully aware of how important this is, have early consultations and give early indications, therefore, as to just how they are going to deal with it.
Lord Bassam of Brighton: This amendment seeks to place an obligation for core elements of the pack to be available when marketing first takes place. Similar powers are already contained in Clause 144(9). As we have explained in the policy notes, which we have made available to the Committee, our aim with pack contents is to try to strike a reasonable balance between comprehensiveness and cost. We propose to include in the pack only those documents that are relevant to the property and its sale and are likely to be of interest to potential buyers and help them to make informed decisions.

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The proposed contents set out in our consultation paper provide information which if not disclosed upfront could later threaten or delay the transaction. Our intention, therefore, is that all documents prescribed for inclusion in the pack will be core documents.
We have gone over this a fair bit, but I want to make one point which I hope will offer more reassurance in particular to the noble Lord, Lord Phillips; that is, we are approaching this with goodwill. We are intending to consult very much with the property professionals so that we get this right and we are very sensitive and in listening mode. Although I can sense some of the difficulties from what has been said, particularly by the noble Earl, who is close to this from his own practical experience, I think it right that we try to tease this out in the consultative period that we shall have. That should enable us to be much more sensitive to market problems and pressures and so forth.
I thought that the point about getting information from managing agents was particularly valid. It is worth saying that if information required for the pack simply is not available because of some obstruction, whether intended or not—perhaps because the information simply does not exist; the noble Earl said that it may be hard to obtain certain information—our expectation in those circumstances would be that marketing could commence without it. But if the information exists and despite reasonable efforts it is not available within a reasonable timescale then we propose to provide by regulation that marketing can commence and that the missing information can be added when it practically becomes available.
So we shall be sensitive to that issue. On talking to friends who have difficulties with managing agents and learning of the difficulties that sometimes tenant or leaseholder groups have in teasing some of this information out, I can well appreciate the difficulty that the noble Earl refers to.
The Earl of Caithness: I am very grateful to the noble Lord for giving way. Perhaps I may press him a little further on his words "reasonable timescale". How long is a "reasonable timescale"? I have asked the noble Lord as managing agent to give me the information, and I am still waiting. When can I go ahead and market the property of the noble Lord, Lord Borrie?
Lord Bassam of Brighton: I am not sure that I want to be pressed on that; nor do I think that the noble Earl is right to press for a precise answer. I do not think that one could be that prescriptive in these circumstances. It would depend on the information being requested and what is reasonable in the circumstances. I think the noble Earl knows that.
I return to the point I made at the outset. We will listen to what we take to be sensible, practical professional views on this issue and make sure that we get it as right as we possibly can.
Baroness Hanham: If we had not put down this amendment, we would not have teased out some quite interesting answers from the Minister. I think the Minister admits that it is entirely possible that elements of the pack will not and cannot be made available immediately.
We have been talking about the speed with which people want to put their properties on the market. In fact, if they are going to have to provide the whole of the home information pack at the beginning, potentially there will be delay to that. It could be delayed even further by the fact that they could not get the information. If the Minister is agreeing that some of that information may not be available, but that it is perfectly possible for someone to market his property by saying that the information is going to come—the obvious moment by which the information has got to be available is by the time the purchaser is beginning to look interested in buying the property—the answer seems to me to be that it would be possible to start marketing the property without some of the information available.
The amendment was really seeking to find out whether there were particular documents which could and probably would be made available quite quickly—whether you could start with those and then pile in afterwards with the more difficult ones. As my noble friend Lord Caithness has rightly pointed out, there are many difficulties with these services. I can perceive difficulties with getting the home condition reports if the provision comes into effect.
The noble Lord, Lord Borrie, said that regulations can always be changed. I do not know whether the Minister's heart sank at that, but mine certainly did because it seems to me that the evidence which would be required in order for regulations to be changed once they had been made would be quite startling and we would never get there.
However, I think that we have an admission from the Minister that the entire contents of the pack may not be available on day one on many occasions; that there will be leeway for people with a valid reason for not having it; and that they will be able to market their property without the information being there immediately.
If the Minister had accepted our earlier amendments which provided that the information did not have to be available in the first two weeks, we would have been home and dry and I would not have had to table these amendments.
Lord Bassam of Brighton: I take the noble Baroness back to the point that I made. What she seeks in effect is already there—in the provisions of Clause 144(9). I said very early on in my response that similar powers are already contained there. That is the key to the answer. We are, of course, going to be flexible in the way in which this is approached.
Baroness Hanham: Yes, it says that the regulations,
"may … provide for the time at which any document is to be included".

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My concern is that there are some documents that may not be able to be included, no matter how many regulations the Minister makes about the time at which they must be available. The problem is when they cannot be available within the time that the Minister says. We may come back to this but I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hamwee Baroness Hamwee moved Amendment No. 196A:
Page 98, line 19, at end insert—
"( ) Before making regulations for the purposes described in subsection (1), the Secretary of State shall consult with representatives of those bodies likely to have an interest in or be affected by the proposals.
( ) A statutory instrument under this Part is not to be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament."
The noble Baroness said: I have been wondering when the noble Lord, Lord Borrie, is going to say, "Okay, I give in, the noble Lord can market my property". Maybe that will come before we conclude the Bill or perhaps the noble Earl should choose another—I was going to say "victim", but I do not mean that—potential client.
This amendment might more logically have been dealt with under Clause 213 but its substance comes quite neatly at this point. The amendment provides for consultation with representatives of appropriate bodies before regulations are made and that regulations should be subject to the affirmative resolution procedure.
We have heard a lot about what regulations can cover in order to deal with matters that your Lordships have raised by way of amendments to the Bill. We have been assured that a whole range of items can be dealt with, if necessary, through regulations. But this is such a wide ranging and fundamental change to the way the domestic property market will operate in the future that it must be right to give this House and the Commons the opportunity to debate the regulations before they are introduced. We are treading new ground—or new water, I am not sure which one does.
A noble Lord: It depends who you are.
Baroness Hamwee: I am not a very good sailor; I will tread ground.
I heard what the Minister said about the groups that have been consulted. In part, that is behind my earlier request to see what survey work has been done. Of course, I do not doubt his assurances about the research and consultation that has gone on, but it would be helpful to see it.
The Minister will probably say that the first part of the amendment is not necessary because the Secretary of State will do it anyway. The purpose of the second part of the amendment is to ensure that, if we do end up with a compulsory scheme, we, and the Commons, get the opportunity not just to express views but possibly even to contribute to a scheme that is slightly better at the end of the resolution procedure. I beg to move.
9.30 p.m.
Lord Bassam of Brighton: We have had a bit of discussion on Clause 144. It sets out the provisions relating to the contents of the pack, as we have discussed, and it gives the Secretary of State the power to prescribe, through regulation, the documents that are to be included in the pack, the formats in which they should included and the information to be included in them.
The regulations will also say who may provide the documents and who has a right to rely on them. They may also specify the time at which any document is to be included in—or removed from—the pack and make different provisions for different areas or different property types.
Amendment No. 196A would add a requirement that the Secretary of State must consult representatives of interested and affected bodies before making regulations under Clause 144. That is a very important point. As I have said many times, we need to ensure that we get the content of the pack right. For that reason, we are committed to having detailed consultations. We want to maximise the benefits for consumers and, at the same time, take full account of the needs of the property industry and the professionals who play a key role in the transaction process.
I am going to make a big admission, which is simply this. I would not want to claim at any stage that all the necessary expertise resides in central Government. That is why, from the outset, we have involved all the main professional and trade bodies, as well as consumer representatives, when researching and developing our proposals.
I think that it is accepted that we have consulted widely on the major issues. Stakeholders are involved in the new programme management structure and the various working groups that we have set up to advise on the detailed contents of the pack. At every stage, we have been very accepting and welcoming of their active participation and co-operation. I can assure Members of the Committee that we will continue that process until we get beyond the point of implementation. I cannot say that we will always agree: that would not be right and it would be dishonest of me to say that. We will of course take careful account of and review their views.
We do not have a problem with full and proper consultation. The intention behind the amendment is one that we share. However, the difficulty is that to consult is such a general duty. For that reason, it is a little unhelpful. It would leave the regulations open to challenge by any person or body that may have an interest, however remote, were they not consulted.
The noble Baroness will have heard me say before, on this and other legislation, that there is a problem with specifying on the face of legislation those bodies that should be consulted. Inevitably, over time, new bodies are set up and existing ones merge or cease to operate. Interestingly, in the property field that happened not so long ago with the Institute of Valuers and Auctioneers, which was originally represented on

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our home buying and selling steering group. As I understand it, it has now merged with the Royal Institution of Chartered Surveyors.
Lord Phillips of Sudbury: I am grateful to the Minister for giving way. Will it help if I remind him that the legislation under the Anti-terrorism, Crime and Security Act 2001 had an almost identical consultation provision in it?
Lord Bassam of Brighton: It is quite likely that it did. But legislation and needs vary, do they not? Amendment No. 196A would also change the Secretary of State's regulation-making powers from a negative resolution procedure to an affirmative resolution procedure. I know that that is a popular change to make in legislation. Obviously, we have consulted with the Delegated Powers Committee. My understanding is that, currently, it is content with what has been set in train in the legislation. Of course, if it was to express a different view, we would have to take that into account when bringing changes forward later.
We feel that these issues are best dealt with through regulations rather than in the Bill. It is important to have flexibility to amend any regulations that are put in place in response to changes in the housing market. For example, changes in the market may make some items of the pack redundant or new sources of information may come to light. As presently drafted, the negative resolution procedure is right, should it prove to be necessary to make some changes.
For those reasons we resist the amendment, although, as I think I have probably expressed in my response, we certainly understand the thinking behind it. It is certainly our intention to consult extensively, in detail and as sensitively as possible. We know that so far, in bringing the legislation forward, we have benefited greatly from the wisdom of the various interest groups, property professionals and institutions that advise us.
The Earl of Caithness: The Minister speaks wonderful honeyed words. He has read out some beautiful bureaucracy. He has an excellent speechwriter—I will give him that—"We are listening; we are sympathetic; we are in listening mode." The Government might be in listening mode, but what have they done since we discussed the seller's pack? The only thing they have done is to change from criminal to civil penalties. They have done nothing. They have been in listening mode on the whole of Part 5, and what have we got? Nothing but a straight block.
My goodness, Geoffrey Boycott looks like one of the most engaging batsmen in the world compared to how the Government are defending this provision. They know that they have a duty to get it through, forget about what everyone is saying, soothe them down and give them some nice words. We could do with a bit more from the Government than just listening mode. If they are listening, the fact that so much solid good evidence and hard argument has been
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put forward from so many people in Committee and yet we have got nothing out of the Government is extraordinary.
Will the Minister confirm that by no means all those taking part in the discussions are in favour of what is going to happen? For instance, the National Association of Estate Agents, which has been heavily consulted, was very in favour of the seller's pack. That was because the chief executive at the time thought it was a good idea. When the members started to say, "Hang on, chief executive, this is not such a good idea after all", he eventually had to resign because he was totally out of touch with his membership.
He has gone on to help the Government in other ways, but the fact remains that the National Association of Estate Agents is not united in support of Part 5. Its members are against it. They might have to work with the Government, but we all have to work with the Government. Will the Minister confirm that many of the people with whom the Government are negotiating: the Council of Mortgage Lenders, the National Association of Estate Agents—many organisations—are trying to knock some sense into the Government because they are concerned about Part 5? Besides consulting and listening will they please take on board some of the advice being given to them?
Lord Bassam of Brighton: I said earlier that we did not always expect to agree with representations made by everyone. The noble Earl is aware of the balance of who is in favour and who is against. He has read the quotes and seen the articles in newspapers, but that does not deflect us at all from believing, understanding and approaching this set of propositions with confidence.
We accept that there will be difficulties in implementation. My noble friend Lord Rooker has made it clear that we will listen sensibly. We have given ourselves a lengthy lead-in period for implementation. We have made it plain that there will be a voluntary period running up to the implementation date, the setting of regulations, and so on.
Of course there will be differences, but that does not mean that we will not focus on practical issues that come up. We have made it clear from the outset that we will listen to those making a practical case on particular difficulties. The noble Earl is being too pessimistic. I am an optimist in these matters: I think that we can get the legislation right and that consumers of estate agents and buying and selling services generally will welcome it over time because they will see that it has improved the process, made the market much easier to understand and enabled them to be much more confident in buying the home that they want.
Baroness Hamwee: The Minister commented on the first part of the amendment and suggested that one reason for not accepting it was the difficulty of knowing who had merged with whom at any given time. The amendment does not suggest continuous consultation but consultation for the purposes of the proposed regulations. I do not take that point.

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As to the issue of regulations by affirmative resolution, the noble Lord, Lord Dahrendorf, who chairs the committee to which the Minister referred, has said to me on many occasions that he does not necessarily expect the House to follow the advice of that committee. It gives advice to the House, not a prescription. We happen not to agree with its approach to this matter.
These are very important regulations. They are almost of the status of the primary legislation in their importance. However, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hanham Baroness Hanham moved Amendment No. 197:
Page 98, line 25, leave out subsection (4) and insert—
"(4) A responsible person shall not commit an offence if he excludes a relevant document from the home information pack, provided the document does not detract from the value of the property."
The noble Baroness said: Having listened to the previous comments of the noble Lord, Lord Bassam, I am tempted to say that if the Government are so confident about these packs it might be a good idea to introduce them voluntarily rather than imposing them. They could then watch people jumping through hoops to get their packs because they will think that they are an overwhelmingly good idea.
That is not what my amendment is about. It is just a comment, which needs to be kept running through the debate, that a voluntary basis would be better than what the Government are trying to do.
As it stands, subsection (4) of Clause 144 is very broad. It states that "relevant information" means anything to do with a property or the sale of a property. We need to test where that ends. For example, a large number of residents living in the counties of Essex, Hertfordshire and Cambridgeshire are currently in the process of fighting the proposed expansion of Stansted airport as they feel that any such development may have an adverse effect on the value and amenity of their property.
We will not know whether that is right unless or until the threatened expansion takes place. However, in the case of the residents to whom I have alluded, if they were going to sell their property and a search—if they did not know about it through publicity—threw up the possibility of an airport, would they need to have a copy of the Government's transport White Paper included in their home information pack so that prospective buyers could make an informed choice about whether they wanted to live near the biggest airport in the world?
The question is only slightly facetious because there will be many other examples where there is a specific problem in a specific area, such as wind farms. There are all kinds of things that may need to be included. It is a question of where the pack ends and whether we go from 200 pages to 800 pages. I beg to move.
Viscount Ullswater: I support my noble friend's amendment. The home information packs will be
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prescriptive and made by regulation. Subsection (5) contains the kind of information which the Secretary of State may consider to be relevant information. The Explanatory Notes almost mirror the smaller items in that subsection.
I should like to inquire about the Minister's views on the importance of including environmental reports in home information packs. I am advised that well over 50 per cent of all conveyancing transactions utilise an environmental report and that lenders are increasingly requesting them. They provide an assessment of the environmental risk, which has an effect on the value of the property. Many environmental factors are important also on health grounds. Perhaps an environmental report should be included in the home information packs.
The report should provide in particular a statement on whether a property's site could potentially be classed as contaminated land. That is crucial, because, under the Environmental Protection Act 1990, the homeowner is liable for remediation costs when the original polluter cannot be traced. I am sure the Minister will understand that remediation costs can run into hundreds of thousands of pounds. I am thinking of old brownfield sites in city centres—for example, old gas works, old tannery business sites and old canal basins—filled with waste on which houses have subsequently been built.
The report should perhaps contain a clear summary of the environmental information that is easily understood by consumers with no previous experience of those issues, along with a clear explanation of where they should go for further help and of where liability lies if they have a dispute. Important considerations such as subsidence, radon gas and flooding should perhaps be covered as well.
If that kind of information is not included, it could result in two searches being carried out—the first for the home information pack and the second by the buyer's solicitor, which would be a completely different level of search. I believe that the Government expect the home information packs to obviate the need for the buyer to conduct his own search, but without that kind of information, the packs will not achieve what the Government set out to do.
The amendment states that a person would not commit an offence if such relevant documents were omitted. Will the Minister give his view on the kind of environmental information that I have discussed?
9.45 p.m.
Lord Avebury: Perhaps I may add a few words to what the noble Viscount said about subsidence. In the part of London where I live, Camberwell, our insurance company suddenly imposed a very large increase in the premiums because it said its experience in the postcode in which we were living was of large claims having been made under buildings insurance policies for subsidence. That came completely out of the blue and I am happy to say that we were able to switch to another insurance company which had a different policy. That is a good example of the kind of

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information of which an unwary purchaser might not necessarily be aware if it was not included in the home information pack. Therefore, whatever information is available about the insurance experience of properties in a particular area should be included in the pack.
Some noble Lords mentioned flooding. As your Lordships will be aware, there have been some remarkable instances of serious flooding in low-lying areas where houses have been built on what is described as the flood plain. I hope that future expansion of housing in this country will take careful note of that phenomenon and ensure that new building is kept well away from such areas. Some large housing estates are already vulnerable to overflowing rivers. A purchaser would be entitled to know something about that.
I understand that the Prime Minister has today warned about the serious effects of global warming. That may have an effect on properties in certain areas; for example, on the coast of East Anglia, where, as your Lordships will be aware, there is a gradual tilting of the country, so that properties are more likely to be overwhelmed by high tides in the future than they have been in the past.
Those are all factors that people are entitled to know about, but with the scarce information about what will be contained in the home information packs there is no mention of any of those natural phenomena. It would be useful if the noble Lord could be a bit more specific about the nature of the information that will be required.
Lord Borrie: My noble friend the Minister will feel that the last two speakers, the noble Viscount and the noble Lord, Lord Avebury, have been knocking at an open door. In addition to energy efficiency, which is specifically mentioned in this clause, it is desirable that other matters relating to the environment, flooding, subsidence, and so on, are all included in a home information pack.
Baroness Hamwee: My example is at the frivolous end of the spectrum. "Relevant information" in subsection (4), which the noble Baroness seeks to delete, is,
"information about any matter connected with the property … that would be of interest to potential buyers."
It might be of interest to a potential buyer that the unusual colour that the faÇade of the house has been painted is number whatever of a particular paint range. I said it was frivolous. If we had more detail, we would understand where the balance lies.
Lord Phillips of Sudbury: I do not think my noble friend's point is at all frivolous. I get a little anxious about just what a burden could be imposed on the whole process if the Secretary of State is in risk-averse mode. The Committee needs some help as to what is meant by those loose words,
"information … that would be of interest to potential buyers".
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I do not know if the Minister has anything in his brief about what those words mean. This amendment would strike out subsection (4) altogether, so we would all like to understand its meaning.
The Earl of Caithness: I have listened with care to what the noble Lord, Lord Borrie, said, and a lot of it was backed up by other noble Lords who spoke. If the information he refers to is included in the home information pack, first, it gets more difficult for the estate agent to assemble the pack; and secondly, the pack gets bigger. The noble Lord, Lord Rooker, took me to task for saying that the Danish pack was 800 pages long, and told me the figure was actually 210. I said that the quote came from the Office of Fair Trading.
I have some more information, taken from a speech given from Palle Ulstrup, the chief executive officer of the Danish Association of Chartered Estate Agents at a Property Forum dinner in 2002. That is the same person from whom the noble Lord received his information. In that speech, Mr. Ulstrup said:
"A Danish real estate expert told the study that the paperwork for an owner-occupied dwelling had increased from an already substantial 100 pages to a frequent 800-page set of documents. This increase in workload may have contributed to the rise in agency fees that has occurred in recent years, despite the already large increases in agency income caused by rising house prices since the mid-1990s".
That is going to happen here. I know the Minister has the pack at 100 pages, but it grows bigger every time we expand it and look for more information.
Some of that information is entirely valid. Subsidence does not follow postcodes. I had just such a problem with a house: when I bought it, there was no evidence at all of subsidence. The surveyor did not find anything; indeed, he could not have done so unless he had peeled the wallpaper and paint off one particular section of the house in the course of a full structural survey. I give way.
Lord Avebury: I am most grateful to the noble Earl. Of course, subsidence does not follow postcodes, but insurance companies think that it does.
The Earl of Caithness: Indeed, it does not follow postcodes. However, the problem with my house was not following shrinkage of the land, but had been caused as a result of a bomb from the Second World War. We discovered that only last year when the wall was renewed. An extension was built on to the house in the early 1990s and the weight of that extension had caused the house to crack. Proper foundations had not been laid because whoever built it had not realised that he was building over a bomb hole. It was all rather fun, given that it had to be dug out by hand. Machines could not do it, and the nice man who did the work was intrigued to find that the subsidence had been caused by a bomb hole.
What we are discussing is very important because it will influence the size of the pack and the duty of estate agents to put it together within a sensible time.
Lord Bassam of Brighton: Again we have had a useful discussion about the contents of the home information pack. By now I am sure that all noble Lords will have read Clause 144 carefully. It gives the Secretary of State a power to prescribe the documents to be included in the pack. Before prescribing a document for inclusion, the Secretary of State must be satisfied that it contains information that is relevant.
Subsection (4) defines "relevant information" as information about any matter connected with the property, or the sale of the property, that would be of interest to potential buyers. The amendment seeks to delete this subsection, the effect of which would be to enable the Secretary of State to require the pack to include information that is completely unconnected with these matters and is of no interest whatsoever to a potential buyer. Where that would leave us, I am not sure, but it would be a chaotic state of affairs and one that we could not accept.
The amendment would substitute a new subsection (4). First, I would like to assure noble Lords that no one will ever be committing an "offence" by failing to comply with these duties as suggested by this amendment. As the noble Earl, Lord Caithness, has acknowledged, we have moved from criminal penalties to civil sanctions because we have accepted arguments on that issue.
The proposed new subsection (4) would provide that the responsible person could omit a prescribed document from the pack as long as it,
"does not detract from the value of the property".
That would require a subjective judgment by sellers, estate agents, potential buyers and enforcement officers on whether the omission of a particular document would affect the value of the property being sold. We would argue that that would cause great practical difficulties and the seller would already have had to commission all the relevant information in order to be sure that the documents did not reveal any flaws which might affect the value of the property.
The discussion has centred on what might be relevant and which documents ought to be included. I thought the noble Viscount, Lord Ullswater, was right to question whether environmental reports would be included, and whether they would include information about contaminated land. Contaminated land is a category in the standard local authority search and we would expect it to be included in the pack. In fact, Clause 144(6) states:
"The regulations may require or authorise the home information pack to include—
(a) replies the seller proposes to give to prescribed pre-contract enquiries".
We would expect those matters to be included. As I recall, they are already included in CON.29. Indeed, if the noble Lord looks at our consultation document, to which I referred earlier, on the contents of the home information pack he will see that the various
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appendices to refer CON.29 and the issues covered in it. Page 18 of the document makes reference to Environment Agency searches and states at paragraph 5.29 that:
"Environmental issues are of significant interest to consumers and home buyers are no exception. The Environment Agency are working to implement Environment Agency property search reports as a standard part of the conveyancing process, alongside local authority, drainage and water searches".
We would expect all those things to be relevant information and for those to be provided as part of the home information pack.
I hope that has answered the various points raised about what might and might not be included. Obviously, it is very hard to be entirely prescriptive. But these things are very relevant, whether it is brown fields, contaminated land and whether water and drainage issues are of importance. All those things need to be covered. We have consulted very extensively on what should be included in the pack on other environmental information. Generally, we have had a favourable response to what we intend to do. It is worth reiterating the point that we shall want to discuss the issue further with those who wish to ensure that we get it right and that the information revealed is of value to a potential purchaser. Having heard that, I hope that the noble Baroness will be able to withdraw her amendment.
Baroness Hanham: One of the reasons why we are having to work so hard through these clauses is because there is remarkably little information about what is likely to be included in the information packs. The core, which has been referred to before, is quite obvious. Indeed, the explanatory notes set it out in some detail.
There are the wider issues. My example may have been a little extreme. There are areas in which demands could be made. The measures are to be contained in regulations which we do not have. We do not know what is to be included in the home pack. My noble friend Lord Caithness referred to 800 pages. We do not know whether there will be 800 pages or 500 pages. We do not know what is going to take the document to 100 pages.
One of the reasons why I raised this question was to see how wide the area of required information would be. I have not had an answer to my amendment. It may be that the noble Lord thought I was being frivolous. It is not a question of frivolity, but of basic information that we ought to be able to dig out from the Government as to what is required in the packs.
I shall withdraw the amendment today. I shall read carefully what has been said. There is no question but that we shall be returning to the contents of the packs in due course. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hamwee Baroness Hamwee moved Amendment No. 197A:
Page 98, line 32, at end insert "but not the contract itself"
The noble Baroness said: This amendment is grouped with our Amendment No. 200A and Amendments Nos. 198 and 201 tabled by the noble

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Baroness, Lady Hanham. There are almost one sentence introductions to our two amendments. The first is to ensure that it is not necessary to supply the contract itself as part of the pack—only the terms on which the property is to be sold. I would think that that is fairly clear. But the Law Society says that it may be a potential trap for buyers to be presented with a potentially binding contract, which they may sign because they believe that is what is needed, but without having professional advice.
The second of our two amendments is to provide an alternative to the normal replies to inquiries which seem to be suggested by the Bill. I understand that the current forms being used are not all conventional replies to inquiries. This amendment is intended to be all encompassing. I beg to move.
Lord Phillips of Sudbury: I have a question to ask which I hope will help the Committee. Clause 144(5)(a), which is the part of the clause affected by the amendment, requires the information to be given about,
"the interest which is for sale and the terms on which it is proposed to sell it".
My question is twofold. First, what if all the terms on which it is proposed to sell are not included in the pack, whether through inadvertence or not? What remedy does the buyer have and what potential penalty, if any, is visited on the seller in default?
My second question refers to a commonplace problem. After one has marketed a property, one's circumstances may change or the market circumstances may change so that one needs, in turn, to change the terms on which one proposes to sell. Does the seller, who has issued the pack on one basis, have to inform all those to whom packs have been sent that he is changing the terms? What happens if he does not know where the packs have gone? He may well not know, as they may have been passed on.
This is a critical part of the mechanism, which is why the Law Society has latched on to it. I would be most grateful if the Minister can help the Committee with responses to those two questions.
Lord Rooker: I shall do my best to answer the noble Lord, Lord Phillips, and I am grateful for his advance warning of the questions. At present, I cannot put my hands on the answer. Dealing with the amendments referred to by the noble Baroness, Lady Hamwee, Amendment No. 197A would prevent the regulations from requiring the pack to include a contract. We recognise the concerns that lie behind the amendment.
In our consultation paper on the contents of the home information pack, in which there is a copy of a home information pack—all 100 pages of it—we drew attention to potential drawbacks of the pack containing a prescribed form of draft contract and to concerns about including even a specimen draft contract. We proposed that the pack should contain a summary of the terms on which a property is being offered for sale. Twenty-four of the 57 responses on
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the issue supported our proposal; and 29 disagreed with including a draft contract in the pack. We are now considering that further in the light of the responses received and the further consultation that we are undertaking, as we speak, with the professional and consumer bodies. The 57 responses were virtually split 50:50.
We do not propose to include in the pack a contract or even a document that is capable of becoming a contract when a buyer is found. I can be quite clear about that reassurance. As I mentioned earlier, any information prescribed for inclusion in a document in the pack must be "relevant information". Clause 144(4) defines "relevant information". It is information about any matter connected with the property or the sale of the property that, in the Secretary of State's opinion, would be of interest to potential buyers.
Clause 144(5)(c) provides that information which the Secretary of State may consider to be "relevant information" includes "anything relating to or affecting" the property that is contained in a statutory register or certain other records.
Clause 144(6)(a) provides that the pack may include the seller's replies to "prescribed pre-contract enquiries". Amendment No. 200A would extend that to cover specifically a seller's property information form. We proposed in the consultation paper that the pack should indeed include something along the lines of the Law Society's property information form, a standard form used by most conveyancers. Thirty-five of the 47 respondents on this issue support its inclusion. Again, we shall now consider this further with the key stakeholders. I can advise the Committee that Amendment No. 200A is not necessary to enable the pack to include a property information form. The form provides information on matters affecting the property which are likely to be important to potential buyers. That information is, therefore, very much "relevant information" within the meaning of Clause 144(4).
We are also satisfied that for the purpose of Clause 144(6), replies to pre-contract inquiries encompass replies to such inquiries made in the property information form. As we explained in the consultation paper, we do not intend that the home information pack should change the principle of caveat emptor—that is not our intention. I did not do Latin—that means "let the buyer beware".
We are not seeking to put sellers under a legal obligation to answer the questions in a property information form. No such obligation exists at present, though buyers have a right to rely on such information that is given. We expect that, as now, most sellers will take the view that it is in their interests to provide requested information where they are able to do so. As I said, the form is basically tick boxes. In some cases— for example, where a property has been inherited—the owner may have only limited information and might not be able to complete the form. The form is well designed to make it quite clear if one does not have the information.

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The noble Lord, Lord Phillips, raised the issue of changing the terms on which the seller proposes to sell. The terms in the pack would be those proposed at the time the property is marketed. If the seller decides to change those terms, there is no requirement in the Bill to change the pack, although clearly it is in the seller's interest to ensure that any such changes are brought to the attention of a potential buyer.
That gives me an opportunity to answer an earlier question, which we were not then able to answer. That was the issue of the updating of the pack. The noble Lord, Lord Phillips, raised this issue yesterday, and the noble Baroness, Lady Hamwee, raised it today. I want to make the position clear. It is not our intention to require the seller to update the pack. That is a misunderstanding. The information in the pack must not be more than three months old at the point that marketing commences. That does not mean it has to be updated every three months. I have heard that said, but we have never said that.
Lord Phillips of Sudbury: I am grateful to the Minister for giving way. Does that mean that if circumstances change—for example, the seller becomes aware of a contamination or subsidence problem after he or she has marketed—that when after they have become aware of the change somebody asks them for a home information pack, they can supply the original pack without that key information updated?
Lord Rooker: Because of the other forms giving information that they will have signed, if they answer questions, they are legally responsible for the questions they have answered. In that respect it is still up to the other searches to identify other matters. It will depend on how old the pack is. They may be asked quite a legitimate question by the buyer's solicitor whether anything had changed since the pack was produced. The person is expected to give a positive answer, "No, there have been no material changes". The person is then legally liable for that information, because that would be like filling in the property information document, which one is not legally required to do, but if it is filled in the buyer is entitled to rely on it. That would be a reasonable answer. If one has not sold the property that has been marketed for three or four months, has anything changed in any of the answers given to the questions? That would raise such an issue. That would cover that. If I am wrong I will come back to the noble Lord. But I wanted to make that point because I had heard before about the need to update the pack. That is not the case. But it must not be more than three months old at the point at which it is marketed.
Lord Avebury: Perhaps I may return to the circumstances mentioned by my noble friend—that subsidence occurred at some point after the home information pack was first compiled. Let us say that the property has been on the market for six months and somebody walks into the estate agent's office and asks whether anything has changed in the answers given. The reply could well be no, because no question
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of subsidence would have arisen at the time that the pack was compiled. He could truthfully say no, and would not be liable for any comeback if it was subsequently discovered by the potential purchasers that the subsidence had occurred and that they had not been informed of it.
10.15 p.m.
Lord Rooker: We are getting to the nitty-gritty of an individual case; of course, the legislation needs to cover all the individual cases that we can think of, and those that we cannot. I shall have to take advice on that. I am answering as a reasonable person in the sense that I am saying, contrary to what people have alleged, that no one has to update and have another survey or home condition report done every three months. We never said that. Others have claimed that that is the case, but it is not. I am making that clear.
Nevertheless, people are entitled to rely on the information that they have been given. After a time, it would be quite legitimate for the solicitors rather than the estate agent to check with each other whether there has been any change in any of the answers that their clients gave, or whether any new information has come to light that would materially affect any of the answers given. It would be legitimate to ask that and demand a clear yes or no.
Lord Phillips of Sudbury: I can help the Minister further. It would be negligence on the part of the solicitor who did not make that the very first question that he asked. I am sure that everyone will be immensely relieved to hear what the Minister has just reiterated—that, in marketing a property, one is not on an endless escalator of updating, new searches and new surveys. That takes a lot of heat out of the matter.
Lord Rooker: Perhaps I should have said it about 10 hours ago. No one asked. The noble Lord did yesterday, but we did not answer; I plead guilty.
Lord Phillips of Sudbury: Earlier today—it was a long time ago—I thought that my noble friend Lady Hamwee made a veiled invitation to the Minister, if he had nothing else to do, to join her firm as part of the property team. I would be interested, too, and could overtop any offer that she may be able to make. The Minister demonstrates the dexterity, resilience and optimism that are the marks of a good property man.
Lord Rooker: I have always been a nosy parker, which is why I thought that I was a moderately good constituency MP. I was nosy on behalf of my constituents. As for going into the legal profession, there will of course come a day when I do not continue to take the Blair shilling, and one may have to look for something else. I certainly had not thought about the legal profession.
Amendment No. 198 seeks to replace "relating to or affecting" with "relevant to". Having listened to what Members of the Committee have said, we are still not convinced that a change is necessary. We find it difficult to envisage any relevant information in the

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registers and records that does not relate to or affect the property. Even if there were any, that would not prevent the Secretary of State prescribing such information in the pack. Clause 144(5) does not affect the Secretary of State's powers under Clause 144(4) to prescribe for inclusion in the pack any information about a matter connected with the property or its sale that is of interest to buyers.
We are in the process of setting up a working group with the key stakeholders to advise on the nature of the searches to be included in the home information pack. All the key players are represented, including representatives of local authorities, search organisations, conveyancers and lenders. Whichever searches are chosen, I am confident that they will meet the "relating to or affecting" test.
The noble Lord, Lord Phillips, asked what the consequence was of all the contractual terms not being in the pack. There is an issue on that relating to the Law Society's opposition to including contracts, but I regret to say that I cannot put my hands on the relevant note at present.
Clause 144(5)(a) states that the regulations may be made on the property for sale and the terms on which it is to be sold. In our opinion, it would be better if all or none of the terms were included rather than for the contractual terms to be withheld. It may be that those terms are material or of particular importance to the buyer and that they would have affected his decision to buy. Withholding some of them may affect the meaning of some that remain.
Clause 150 confers the right of private action in respect of failing to comply with a request to produce a pack. Ultimately, that must be a matter for the buyer and the seller to resolve. We do not think—this may be the noble Lord's concern—that the pack would affect the validity of the sale. Either the property has passed from person A to person B or it has not, but that matter relates to the legal contract and the exchange. The contents of the pack would not affect that part of the sale. I am not sure whether that answers the noble Lord's specific question. If it does not, I apologise and I shall try to come back to it.
Lord Phillips of Sudbury: I am most grateful to the Minister for even endeavouring to answer the question. I think that it would be helpful to the Committee if he returned to it because Clause 150 does not provide compensation; it provides only for the recovery of fees paid by a frustrated buyer following, for example, the failure of a would-be seller to provide the necessary survey. It would not cover a case where a seller simply did not put into the pack other terms required by the subsidiary legislation. As I said, I think that it would be helpful to hammer this matter out later.
Lord Rooker: We would not expect the omission of a component of the pack to affect the validity of the sale. That is our view. We do not think that if a component
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of the pack were omitted, the technicality of the sale—the exchange of the ownership from one person to another—would be affected.
Lord Phillips of Sudbury: But it might of course affect the price which the purchaser would have been willing to pay had he or she had it.
Lord Rooker: I fully accept that, and that would be a matter for later action because the sale would have taken place. I presume that such things happen now; for example, where the sale has taken place but the new owner is aggrieved about something that was missed out in the normal course of events and he may seek to claim damages due to negligence from someone who had advised him—perhaps the estate agent or the solicitor who had been acting for him. Perhaps damages would be sought from the previous owner, who did not answer all the requests for information. There have been cases in the courts involving people who did not correctly fill in the voluntary check list. They filled it in but not accurately, and the buyer was entitled to rely on it.
Lord Phillips of Sudbury: I thank the Minister for that. The only reason that I persevere with wondering whether it is not worth a little more investigation is that Clause 150 deals with a civil remedy—this has nothing to do with criminal law—but does not refer at all to normal common law compensation rights. But perhaps that is not necessary. Again, it may be worth the Government returning to this matter because I suspect that this is the kind of thing that will happen many, many times, and it may be as well if we cleared the decks for the consumers.
Baroness Hanham: This exciting exchange prevented me realising that I had Amendment No. 198 in this group. The Minister has kindly replied to it even though I have not moved it. It is a small amendment and I do not need to move it. However, I also have Amendment No. 201 in this group, and it may be easier if I deal with it in its place if the Minister is happy to reply to it then. So exciting has this exchange been that the amendment now has nothing to do with this issue and it would be more appropriate to deal with it later, but it is down to the Minister to decide. I see that he nods his head in agreement.
Baroness Hamwee: I take issue with my noble friend. I think that the Minister would be wasted on property work. I can see him so disarming other parties to a negotiation over a major commercial transaction that he would just walk all over them. That displays my view of conveyancers.
The Earl of Caithness: And he does not need any qualifications to do that!
Baroness Hamwee: I am grateful for the detailed assurances that the Minister gave on the two amendments we started some time ago. We seem to have wandered slightly. I beg leave to withdraw the amendment.

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Amendment, by leave, withdrawn.
[Amendment No. 198 not moved.]
Baroness Maddock Baroness Maddock moved Amendment No. 198A:
Page 98, line 41, after "property)" insert ", though the provision of any such information by the seller shall be voluntary and entirely at his discretion, and the Secretary of State cannot require the seller to provide such information in the home information pack through regulation"
The noble Baroness said: I apologise to some Members of the Committee. We said that we would not move the Amendment, but now we are moving it. It deals with the word "voluntary", which we have discussed quite a lot today. It also refers to the home condition report not being a full structural survey, which we have also discussed. That was the reason why we were not going to move it, in the interests of getting a move on with the business. However, as the Minister had a rather good speech in reply, we were begged to move it.
The amendment is fairly simple. Its purpose is to make the home condition report voluntary. We believe that if the whole thing cannot be voluntary, the inclusion of the home condition report in the pack should be voluntary. It is one of the most expensive elements in the pack and therefore likely to add considerably to the cost of moving home. In many cases we believe that buyers and lenders will not feel able to rely on the report. That is an issue we have discussed several times under this part of the Bill.
We understand that it is not a full structural survey and that it does not contain a valuation. Therefore, we know that mortgage lenders may want a different sort of survey, as will many people buying a house. During the recent exchanges on the lifetime of a pack, particularly on the home condition report, I was struck by the fact that if you could not sell a house for three years, you would probably need to paint the woodwork, for example. So, there are many difficulties with this.
Perhaps I may press the Minister on another point ill the same section. Clause 144(5) refers to the energy efficiency of the property. It is listed under,
"the information which the Secretary of State may consider to be relevant information … about",
and there follows a long list which includes the energy efficiency of the property. Can the Minister confirm that when the EU regulation kicks in requiring people to have an energy efficiency report on their home, it will be required at the point of sale under the European regulation? Again, that backs up some of the points that we have been discussing about the need for information to be ready on day one of marketing. I look forward to the speech which the Minister wanted to give in reply to our amendment. I beg to move.
Lord Rooker: I am grateful to the noble Baroness for moving the amendment. There are a few points I want to make to clear up some misunderstandings and hares that have been set running. This amendment seemed the most appropriate place in which to do that. I fixed all my notes according to that, but then I was passed a note saying that the amendment would not be moved.
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I could have included all the material I have elsewhere, but this seemed the most appropriate place. I wanted to reiterate the point we made earlier as I take the last point about the energy report.
I am not good on the EU issue. I know that there is a requirement. It is in the consultation document at pages 128 to about—for existing houses—132. The energy report on the new home was set out as part of the consultation. So there is no surprise about that because a model pack was published in March last year. The home condition report runs to about 20 pages. They are obviously blank forms, but it gives the kind of information that would be required.
Clause 144 deals with the contents of the home information pack. It gives the Secretary of State power to prescribe the documents to be included in the pack, the time at which they should be included and the information that may be included in, or excluded from, those documents.
The information prescribed is subject to the condition that, in the opinion of the Secretary of State, it is information that is relevant to the property being sold. Amendment No. 198A would add a restriction to the effect that sellers may provide the information voluntarily but cannot be required to do so under regulations made under this part.
In our discussion on Amendments Nos. 183B and 185A in Clause 137 we explained why a voluntary home information pack system would not work. The same arguments apply here. I thought that the noble Baroness accepted that, hence she was not going to move the amendment. We need the home condition report to be a standard part of the pack. Its inclusion is fundamental to achieving the objectives of the reforms, for reasons I shall explain.
Our objective is a home-buying process where people are confident that their transactions will succeed by a reasonably certain timescale and at a reasonably predictable cost. To achieve that we need to make sure that the main factors that cause transactions to slow down or fail are known at the outset, not half way through.
Our research showed that 28 per cent of all transactions fail after an offer has been made. That is a huge number. Problems revealed by either a lender's valuation inspection or an independent survey account for 43 per cent of failed transactions. Condition-related problems also cause delays in transactions which ultimately succeed. Twelve per cent of all sellers reported such problems between the lender's valuation, inspection and exchange of contracts.
These problems are compounded because of chains. About 60 per cent of transactions involve chains. The industry estimates that an average chain has four transactions, so the knock-on effects of condition problems can be felt by over a half of all of transactions.
I have used the figure of 43 per cent again, which has been challenged. Yesterday it was almost alleged— I do not put words into noble Lords' mouths—that in effect by using the 43 per cent I was exaggerating the number of sales that had fallen through because of bad

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surveys. The 43 per cent failure rate is derived from the findings of the 1998 research study, reported in Key research on easier home buying and selling. The research report indicates that in 13 per cent of cases the transaction failed following an unfavourable property survey commissioned by the buyer himself.
The research report also said that a further 30 per cent of buyers withdrew as a consequence of their lender's valuation survey report. Opponents of the reforms have tried to claim that this 30 per cent had nothing to do with property condition.
The research report breaks down the 30 per cent and says that 10 per cent was attributable to the lender's valuation being too low and 20 per cent because of "other matters" revealed in the lender's valuation survey report. So it seems preposterous to claim that the 10 per cent that failed due to the lender's valuation being too low had nothing to do with the condition of the property. How do they know that the down valuation did not reflect the property conditions? As far as the remaining 20 per cent is concerned, what else could those "other matters" be if not condition problems of some shape or form?
I know that the lady I am going to mention was criticised, but, in her evidence to the Commons Select Committee on the Bill, Maria Coleman said that one of the main reasons for starting her voluntary scheme was the discovery that 71 per cent of her transaction failures were due to an adverse survey. We estimate that the home condition report will add about £350 to the £4,000 plus bill that sellers already typically face. This is a small price to pay for a survey that will be of great value to buyer and seller alike.
I have already referred to the 28 per cent of deals that fall after a valuation. We have put a figure on that of £350 million of wasted money, which is £1 million a day wasted in this country. That has been challenged as well, so I want to explain how we got the figure. The tracking surveys in the 1998 research study, Key research on easier home buying and selling, recorded details of the costs incurred by people whose purchase or sale had fallen through. It found that the average cost of a failed transaction was £906: £680 for buyers and £206 for sellers. However, the number of people who provided these details was small, as was said yesterday. It was fewer than 30 cases and the research report advised that the figures should be used with caution, which is what I am seeking to prove that we have done. At £906 per failure, that adds up to around £530 million a year. So our estimate of £350 million takes account of the uncertainty over the small sample size and assumes a cost of only £600 per transaction failure for the total cost to buyer and seller. Despite attempts to talk down the rate of failure—some people claim that it is a lot less, at 15 per cent—our recent discussions with some of the largest estate agency firms in the country, to which I referred yesterday and which is not a scientific survey, show that the failure rate is still about 30 per cent. I give way to the noble Baroness.
Baroness Maddock: Earlier on, the Minister used the figure of a 28 per cent failure rate for transactions. He then said that 43 per cent of those were due to the survey going wrong. That is only 12 per cent of the total.
Lord Rooker: So what?
Baroness Maddock: The Minister is accusing noble Lords of talking the figures down yesterday and I think that that is something like the figure that came out yesterday.
Lord Rooker: We have an enormous number of failures. I have broken that figure down and it does vary. That was the claim that we made and our own research showed that only 13 per cent of transaction failures were for that reason. I was not hiding the figure. In fact, I used the figure yesterday of 13 per cent at the same time as I used the figure of 43 per cent. But, taken in the round, we have a major problem of waste of money and distress caused to people in this country.
I want to put seven brief examples on the record because the department receives a steady stream of correspondence from people who have been let down by the current system. These cases show that our estimate of the cost to individuals of failed transactions is vastly underestimated. We have used £350 million, which averages about £600 for buyer and seller together. I want to give some recent examples that have come into the department. They are very brief and there are only seven of them.
The first one relates to a lady in Somerset. Her offer on a property was accepted but the property was then withdrawn from the market by the seller after four months, as planning permission papers for garage access could not be produced. She wasted £730 on valuation and search fees. This is in addition to a previous attempted purchase where the property was withdrawn after three months, due to problems with the property. On that occasion, £680 was wasted on valuation and search fees.
A Brighton pensioner had her offer of the asking price accepted. She then engaged solicitors and had the survey done but days before the contracts were to be drawn up the vendors withdrew, leaving her with a bill of almost £1,000 and nothing to show for it.
A young London couple with a young daughter spent months looking for a property. They then spent months going through the buying process, spending almost £2,000 on fees. They signed contracts to the point of pre-exchange. The sellers pulled out at the last minute. All of those sums are well above the £600 figure that I used.
A vendor in Cardiff accepted a couple's offer on a property. They became nervous when a "To Let" sign was put outside the property, but the vendor assured them that the sale was still on. At the last moment, the property was withdrawn. The couple had spent all their savings—more than £1,000—on surveys, searches and fees, and have absolutely nothing to show for it. Again, that is well over the £600 figure.

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In Gateshead, a vendor assured Mr F four times that the property would be his, after agreeing to terms on the house. He paid for the search fees. The vendor then informed him that the property had been sold to another couple. He is afraid that that could happen to him again and again, costing him thousands of pounds before he has even paid his first mortgage instalment.
In the south-west, in Exeter, a lady wrote on behalf of her daughter—a first-time buyer and a nurse—whose offer on a £90,000 flat was accepted. The seller pulled out at the last moment after the writer's daughter had paid for a survey, searches and other items that cost more than £1,000. The final solicitor's bill is yet to come on top of that.
My final example is that of a couple of young architects in London trying to buy a property for some time. Eventually, they had an offer accepted a few months ago. A week before completion the seller pulled out as he wanted more money. They have paid out several thousand pounds on abortive fees with no recourse, plus distress and upset.
Those examples are just a sample of the letters that come into the department. As I have said, 18 months ago I addressed the National Association of Estate Agents. I did not use the prepared speech, I just asked for the last 20 letters that I had signed to Members of the Commons in answer to queries from their constituents. I chose a dozen examples to read out instead of the speech in order to try to explain that there was a problem. I was accused of all kinds of things, but I just said, "Well, this is the people speaking; not me or the Government".
One of the letters did not go down very well because it was from an estate agent who had spent 25 years as a police officer. He had some quite disparaging things to say about buying and selling houses, which were far worse than anything that he had come across when he was a police officer. That did not go down at all well. I really had to ensure that I did not disclose his location in the country.
I am not claiming that the examples I have given are scientific. But, I am saying that our figure of £350 million for the waste is a very conservative figure based on the 30 cases that we had. With a £600 average cost for buyers and sellers—I am quoting only potential buyers here—the costs involved in every one of those examples are well above that figure.
The noble Earl wants to rise and respond. He will be able to explain his own views: he has brought to this debate his personal experience. But on the website of the estate agency where he is a consultant, the average properties for sale are between £500,000 and £2 million. Frankly, that is not the generality of house buying and selling in this country.
The noble Earl is expert in a very atypical part of the country. He is expert in other matters and I have found his contribution extremely valuable. But that is a matter of public record. On the website of said estate agency, the highest value property is £4.6 million; the cheapest is about £300,000 for a studio flat. That is not typical of buying and selling properties for the 40,000 dwellings that are put on the market each week in this
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country. Although the noble Earl can bring his technical expertise to our debates—for which I am very grateful—frankly, in terms of his expertise of buying and selling on a daily basis, that is not relevant to the generality of millions of people in this country who are buying and selling houses every day. As he clearly wants to get up, I shall give way to him.
The Earl of Caithness: I am very grateful to the Minister for giving way. Yesterday, I said that I agree that the market in which I work is a specialised sector. But that is part of the housing market. There is no one housing market: every area is specialised. From the bottom end of the housing market with the lowest capital value houses, which will be excluded from the home information pack and the home condition report, right up to the top value houses, they are all part of the housing market. However, the transactions are exactly the same. We have the same problems with people pulling out and potential buyers wasting time that every other market has. All that is different is the price bracket.
10.45 p.m.
Let us look at what the Minister has just read out to us when it comes to failures because of valuation. Nothing in the Bill is going to affect that—there is no change. The home information pack does not contain a valuation. Perhaps it should, but there is nothing that will change the present situation. The vendor's agent will put a price on the property. If the purchaser comes along and the sale falls through because he or his mortgage company has a different valuation, that will be no different. The situation remains the same. The same letters will still come into the department.
The pre-purchase survey will change little. There is going to be a home condition survey. That is not a full structural survey. The Minister has said that all that is required of that survey is that it must be made within three months of the property being marketed. Let us imagine that we are in a poor property market and someone's house has been on the market for nine months. A potential purchaser comes along and asks whether anything has changed since the home condition report. The vendor will then say, "Yes, you look for yourself. That was the home condition report at the date that it was marketed. It was valid at the date of its market. Yes, things have happened, but caveat emptor"—I have the same problem with Latin as the Minister—"it is up to you".
So the buyer has to carry out his own survey at his own cost. There is no change to the current situation; we are back to the same position. The department will still receive letters about pre-purchase surveys. Let us say that the seller pulls out; sellers pull out for all sorts of reasons. In the key research to which the Minister referred sellers pull out because of changes in financial circumstances; because they did not continue the purchase of the house; because they decided to stay where they were—there are all sorts of reasons for pulling out. Nothing in the Bill or the home information pack will alter that in the slightest.

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Let us say that the property is sold to another person. That is going to happen. It does not matter whether there is a home information pack. If someone else comes along with a higher offer, the vendor will sell. The agent is duty bound to obtain the best price. The department will still receive letters.
The Minister referred again to sellers pulling out. The one area where there could be a potential change is to have the searches upfront, which might speed up the process. But there is no requirement to keep the searches up to date, so if the property has been on the market for nine months, all that the vendor's agent has to say is, "Yes, the searches were done in accordance with law. It is up to you to check whether it's changed. I am not going to spend any more money. Prescott has made me spend all this money upfront. I'm not going to do a darn thing more. Why should I? It's up to you as the purchaser".
What in reality is going to happen is that there will be a change for properties that can be sold quickly in a good market. In a bad market we will be back to exactly the same position as now. One noticeable thing that will change is that the purchaser will be presented with a home condition report. Most purchasers do not have any survey or condition report undertaken now. They will be handed 20 pages—which are pretty general; we will come to that in a moment. They will ask whether anything has changed. As the agent I will say, "Yes, it is up to you to check what's changed, because it's caveat emptor". They will then in all probability get in a surveyor to carry out another report, which they are not doing at the moment. That pack will lead to more expense.
I understand exactly where the Minister is coming from. But the Bill does not change a single iota of what he said, except possibly for houses that are sold quickly in a bull market.
Lord Rooker: By giving way to the noble Earl, I have lost track of where I was; I was nearly at the end.
I want to answer the point raised about the energy efficiency report so that there is no misunderstanding, but let me make a point about the additional cost of the home condition report. I said that, against the total money that the seller must pay, £350 out of the £4,000 bill that they already typically face, is a small price to pay for a survey that will be of value—the value being that, hopefully, it will cut down the loss of the £350 million, which I tried to explain was a fairly modest figure.
The additional cost, of course, is offset by savings in those transactions where the buyer would have commissioned his own survey. In many cases—not all—it could eliminate the need for separate mortgage valuation inspections, which cost borrowers almost £200 on average, and remove much of the wasteful duplication of surveys that occur under the current system where more than one buyer has surveys on the same house. That is the reality. People queuing up to buy have their own surveys carried out on the same property. It is an enormous waste of money.
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As to the energy efficiency requirement, our consultation document was published in March 2003. In regard to the issue about the energy efficiency information being required at the point of sale, the answer is yes, but Article 7 of the directive makes clear that the intention is that the information should help the prospective buyer with his choice of a home. Our own information pack proposals pre-date the European Union directive and it has always been our intention that this energy efficiency information should be available at the point it is of most use—which of course is at the start of the transaction in the home information pack.
Yes, sellers will still sell to someone else with a higher offer, but, unlike now, the buyer will not be saddled with the cost of the surveys and searches. In the examples I have given, the people would not have wasted their money in the first place.
I am sorry that I have taken a little longer than I expected but there were some general points that I wanted to put before we reached the end of the home condition part of the Bill.
Baroness Maddock: I thank the Minister for that reply. We have tried to save time and I hope that it is there on the record.
The noble Earl, Lord Caithness, has made many of the points that I wanted to raise. I thank the Minister for clarifying the energy efficiency report. It is the one part of the home condition report that we would support being compulsory. It is very important. Another part of the EU regulation is that it should be indicated to people how they can improve the energy efficiency of their home, which is a useful suggestion. I am very much in favour of it and have supported it for a long time.
We could bandy figures about the Chamber—and I do not detract from the real distress that people suffer in buying and selling homes—but the Minister is right to say that this is not a scientific issue. It is not. He is referring to a self-selecting group of people who write with their problems. Although it gives us quite a good picture of the kinds of things that go wrong, we have to be careful about drawing big conclusions from such examples. I referred to the percentages earlier.
The Minister has given very detailed replies but, at this hour of the night, I am going to have to read very carefully some of his remarks. It has been a helpful debate. Noble Lords on this side of the Chamber would like the pack to be voluntary, but not the energy efficiency part of the home condition report.
We know that many people are not going to rely on the home condition report and that they will carry out surveys. People are always arguing about surveys. I have had a terrible experience with a survey myself. I bought a flat that was recommended to me. I have discovered since I moved in that he failed to realise that I was paying for all the electricity on the communal staircase; he also failed to inform me that the radiators were outside my property. There are great difficulties involved and everybody can tell a story about how surveys have gone wrong. I am not convinced that the

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home condition report is going to be so much better than many of the surveys, but as it is late, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 199 and 199A not moved.]
[Amendment No. 200 had been withdrawn from the Marshalled List.]
The Earl of Caithness The Earl of Caithness moved Amendment No. 200ZA:
Page 99, line 6, leave out paragraph (a).
The noble Earl said: The amendment would delete Clause 144(6)(a), which states:
"The regulations may require or authorise the home information pack to include replies the seller proposes to give to prescribed pre-contract enquiries".
I do not see the point of including such a requirement in the Bill, because the Minister has said that the property for sale can be changed without having to change the home information pack. If, after a number of pre-contract enquiries have been made, the property is changed or an alteration in the negotiation is made, all those enquiries become invalid. Until the contracts are exchanged, nobody can be totally certain of what is being sold in a property.
I shall take three brief examples. The first is the three-bedroom semi-detached house which has been used as an example in some of the Government's figures. The pre-contract enquiries may concern the kitchen units and that will come up in the home condition report. The vendor might say that he is selling the property with the units included. The property takes a little time to sell and the vendor renews the kitchen units. He does not have to have a new home condition report or change the home information pack. He has therefore ticked all the boxes that regulations require him to tick, but he has changed his mind about the kitchen because he has put in new units and he wants to take the dishwasher, the deep freeze and the new cooker with him because he has just spent a lot of money on them. However, that is reflected in the price of the property. It is only when one has the price of the property and knows what is included in the sale that one can answer those kinds of questions.
Let us look at a house with land. Let us move out of the city and into the country. Somebody is selling a house and a garden, but owns the field next door. He excludes the field next door from the sale. The pre-contract enquiries may ask who is responsible for the boundary fences and that box is filled in. During the negotiation for the sale of the house and the garden, the vendor is made such a good offer by a potential purchaser of the field that he decides to sell it. Once again, all the boxes that he has ticked have to be changed. It is not until the price and what is included in it are agreed that answers to those questions can be had.
What about the house next door? Exactly the same situation arises. What if I am just redeveloping a property? I have a home condition report when I buy it, and it is fit to live in—but what if I decide to remodel
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the house, and I am adding bits to it, uncertain exactly what I am going to sell until the final terms are agreed? The main thrust of the argument for deleting subsection (6)(a) is that, until the final terms are agreed, one does not know what is included in the sale and what is not. Why do we need regulations to contain,
"replies the seller proposes to give to prescribed pre-contract enquiries",
when one does not know what the sale is going to include? I beg to move.
11 p.m.
Lord Rooker: This amendment would, as the noble Earl said, delete subsection (6)(a) of Clause 144, which provides that regulations may require the pack to contain,
"replies the seller proposes to give to prescribed pre-contract enquiries".
It is standard practice under the current system for the buyer's conveyancer to seek information from the seller on a range of matters relating to the property, including boundaries, disputes, notices, planning consent and other matters about which the seller would normally have information, and which it is important that the buyer knows about. The Law Society has produced a standard property information form that is used for just that purpose, and I suspect that more than one noble Lord could probably quote chapter and verse from each of its questions.
As the information is needed by the buyer and is provided under the current system, it is clearly "relevant information" for the purpose of subsection (2) of Clause 144. The Government have consulted on the contents of the home information pack, and most of those who have commented on this particular point thought the pack should include a property information form along the lines of the Law Society's form, which was included in our consultation document. The contents of the pack will be set out in regulations, but we have not yet taken any final decisions. The Government are establishing specialist working groups to consider these matters, and there are some issues around the property information form. For example, in some cases, sellers may have limited knowledge of the property and be unable to provide answers. Sellers are not legally obliged to answer questions now, and we do not intend to change that.
The noble Earl raised issues relating to fixtures and fittings. What he did not do, when he talked about the kitchen appliances, was say whether they were built in or not. If a kitchen is built in, I think it would be a reasonable assumption on my part, as a reasonable person, that when I open the doors I will find the oven and the fridge. If they are freestanding, that is another issue, and indeed the question of whether the furniture is built in or not is covered in some of the forms. If the equipment changes during the course of the sale, that is a matter that can easily be decided. I do not see any great issue there.

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The original list is just a starting point for negotiations; no one ever refers to it as a straitjacket. I am not aware of it causing major problems, except where people tell porkies when they answer the form, and people then abort statements that were untrue as regards boundaries, disputes with neighbours or other issues. As I said, the specimen form is in Appendix K of the consultation paper on the contents of the pack. We expect that most of the information will not change. We are consulting on the matter, because it is important that we get this right with the industry. It is 18 months ago, near enough, since we published the consultation document. No one is saying that that is exactly the form it will take, but that document will largely form the basis for the home information pack.
The Earl of Caithness: All those who have bought and sold their own houses will be aware of the form. However, the simple point I am trying to make is that where there has been change to the property being marketed—as the Minister has said, that does not necessitate a new home information pack—the answers given to the inquiries laid down in regulations would be wrong. However, obviously that does not matter. If neither the vendor nor the agent are to be penalised because the answers are wrong, then I do not see the point of giving them in the first place and the need for this amendment is removed. It means that you can put what you like in the information pack and change the circumstances at will. The home information pack will mean nothing to the potential purchaser: this is caveat emptor and he will have to do his own thing anyway.
This has proved that much of what the Government seek is not binding and will make life more complicated for the potential purchaser. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 200A not moved.]
Baroness Hamwee Baroness Hamwee moved Amendment No. 200B:
Page 99, line 14, leave out from "which" to end of line 16 and insert "acknowledge liability for any error contained in the prescribed document due to his negligence in favour of"
The noble Baroness said: In moving this amendment I shall speak also to Amendment No. 206A which is grouped with it, along with Amendment No. 202, tabled in the name of the noble Baroness, Lady Hanham.
The first of these amendments would remove from subsection (8) the words,
"enable provisions of the contract under which the document is to be prepared to be enforced",
and insert instead,
"acknowledge liability for any error contained in the prescribed document due to his negligence in favour of".
This is another amendment suggested by the Law Society and seeks to establish exactly what is intended here.
Subsections (7) and (8) appear to empower the Secretary of State to make regulations that would entitle the buyer, the lender or other persons to enforce the provisions of the contract under which a prescribed document is to be prepared. I should be grateful if the Minister could assist us on exactly what is intended.
Amendment No. 206A would allow sellers, buyers and lenders to bring proceedings where they have relied on information contained in the home condition report which proves not to be correct. The Minister spoke earlier today on the issue of liability, but if a home condition report is included in the pack, it ought to be correct for anyone who needs to rely on it. The seller could secure compensation if the report is defective, but if the lender and the buyer cannot secure compensation—or, to put it another way, if the person preparing the report knows that he will not be exposed to action from the lender or buyer—then they may well be reluctant to rely on that report. If there is no redress, one's reliance is reduced accordingly.
The amendment deals with the issue of liability, which is probably a more important matter than is indicated by this minor amendment. I beg to move.
Baroness Hanham: Amendment No. 202 is grouped with this amendment. We have not really touched at all on the surveys which are required before a mortgage can be obtained. Practically every person who buys a house has to have a mortgage survey. The Minister has said on a number of occasions that 77 per cent of people do not undertake a survey of their premises. But that is nonsense in terms of those who have mortgages because they have a survey of a sort. It is usually not a survey that stands up sufficiently as a full condition survey
However, if there is to be a survey for a home condition report, is it the intention that it should be acceptable to the mortgage lenders so that they will not have to do another survey in order to justify a mortgage? I do not need to go into the situation any further. That is the nub of the amendment.
Lord Bassam of Brighton: I shall deal with Amendment No. 202 first because I believe that I can satisfy the noble Baroness, Lady Hanham, on that. This amendment would require the Secretary of State to ensure that the home condition report is acceptable to lenders. We accept that it is crucial that the report is acceptable to them, but I am reluctant to single them out in the way the amendment suggests. It could be dangerous to do so as it could give them a right of veto over the format and content of the home condition report.
That said—and I want this understood—we have been developing the home condition report in very close consultation with mortgage lenders and the Council of Mortgage Lenders to ensure that their information requirements are met by the home condition report. I hope that satisfies the noble Baroness because it is intended to. Obviously, we cannot give people a right of veto over the process of consultation, but it is intended to cover the points that need to be covered. I hope that is a helpful response.

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Amendment No. 200B would specify that the terms of documents provided in the pack may include terms that allow claims for negligence to be brought by those who rely on them. Of course we share the sentiment behind the amendment. We all want the packs to be useful to those involved in a transaction. However, I do not think that the amendment is necessary.
The Secretary of State will prescribe the components of the home information pack in regulations under Clause 144, as we have explained. Subsection (7)(b) of that clause enables him to prescribe the terms on which they are prepared. This will provide the means for achieving what I believe the mover of the amendment wants. Clearly, the Secretary of State will want to ensure that sellers, buyers and lenders can rely on these documents.
We intend that the home inspector's liability to sellers, buyers and lenders will be secured by contract. Home inspectors can therefore be bound by the Contracts (Rights of Third Parties) Act 1999. This should ensure that the buyer and lender, as well as the seller who commissions the home condition report, will be able to rely on it and bring proceedings against the inspector should that prove necessary. It is the current intention that regulations made under Clause 145 will specify that home condition reports must contain a statement confirming the rights of buyers, sellers and mortgage lenders to rely on its contents. I believe that is a response to the points raised.
Amendment No. 206A was also in this group. I shall refer to it even though I am not sure that it has been moved. This amendment would require the Secretary of State to be satisfied that appropriate arrangements were in place for buyers, sellers and lenders to be able to bring proceedings against the person who prepared a home condition report upon which they relied before he could approve a certification scheme.
We endorse the sentiment behind the amendment, but we do not believe that it is necessary. We believe that the arrangements we have set out will provide sufficient safeguards to cover all the interests of those who rely on home condition reports. I have tried to give assurances here and I hope that they match the points made in the amendments.
The Earl of Caithness: I listened carefully to what the noble Lord, Lord Bassam, said in reply to this group of amendments. Would he not agree that although the home condition report might satisfy the criteria of the mortgage lenders when first made and there is no valuation in the home information pack, the mortgage lenders have to undertake some kind of valuation in order to make the grant of a mortgage?
Secondly, the older the home condition report—it does not need to be updated—the less any lender will rely on it and the more likely it is that the lender will have to instigate a survey of his own to update the pack because a seller does not have to and the seller will not. Perhaps at day one it may satisfy the criteria, but in the
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five months, six months, nine months, two years it could take to sell a property, no lender will rely on such a report and there is no valuation attached to it. It has huge built-in weaknesses.
11.15 p.m.
Lord Bassam of Brighton: The noble Earl makes a good point. Most transactions will not take the period of time that he has described, although some will. Even the noble Earl will accept that for an overall percentage of transactions to take longer than six months to go through the purchasing process is perhaps exceptional; certainly a year is very exceptional indeed.
I know the noble Earl is a specialist, but the lenders may want to satisfy themselves; they may want to have another look at some points, particularly if the transaction period is extended. We are talking to them about the detail of the home condition report. We shall no doubt have to continue our discussions with them on that because we want that report to be of value to them, so that it obviates the need for independent and separate reports to satisfy the lenders. We recognise the issue and we recognise some of the implications raised in this discussion. But it is our intention to do all that we can to ensure that that report satisfies them so that they can lend money against the property.
Baroness Hamwee: I freely acknowledge that at this time of night I am flagging. I shall not attribute that to others, but I shall have to read what the Minister has said. I am not sure that I have followed everything, which I am sure is my fault and not his.
On Amendment No. 200B, we are assured that the regulations will be all right, but when talking about issues of enforcement I am not sure that that is wholly satisfactory. I spoke to Amendment No. 206A, but I want to see in black and white what has been said as, earlier, I had understood something slightly different from the noble Lord, Lord Rooker. I thank the Minister for his reply.
Baroness Hanham: I am very interested in the Minister's reply that work has been carried out with the mortgage lenders. The hope is that the home condition report will satisfy them. It would be essential for the home condition report to carry at least a statement saying that it is accepted by the mortgage lenders. As with other matters, one can see that beginning to fade out of existence, as the home condition report removes the novelty. It seems to me important that the buyer will be exempted from having to pay the costs of a valuation in those circumstances; indeed, the seller will have paid for the valuation report for the buyer. That is a completely new concept. I shall not take the matter any further tonight. It has sparked off a whole new area of interest, but I shall not bother the Committee with it tonight.
Baroness Hamwee: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hanham Baroness Hanham moved Amendment No. 201:
Page 99, line 27, at end insert "; and
(d) allow the Secretary of State to enable local authorities to set and maintain fees for those searches and functions under the Local Land Charges Act 1975 (c. 76), The Local Land Charges Rules 1977 and the Common Registration Act 1965 (c. 64)."
The noble Baroness said: The amendment gives the Government a chance to redeem themselves in the eyes of local government by giving local councils more power to raise money locally.
There are currently two types of search. The first type is the official search carried out by local authority officers. There are also now reports carried out by private agencies which are becoming increasingly popular. I dare say that private agencies will still be entitled to do the searches for the vendor. However, these private agencies still have to rely on the information from the local land charges register. Those are given to them by council officers.
The cost of the searches at the moment is set by law at £11. That does not cover the costs. The estimated actual cost in time and effort of local council officers is more likely to be £50 per search. Where a local council is able to charge a sensible amount for the services it provides, these local agencies have estimated that a sum in the region of £60 million from revenue would be raised by local councils across the land. That is a positive development that I hope the Minister will accept. I beg to move.
Baroness Hamwee: I support this amendment. I am very glad that the noble Baroness was fast enough to table it. I realise that we should have tabled it and was happy to see that it was tabled. Personal searches are made because the purchaser wants to get on with it and is prepared to bear the professional cost of a personal search—in other words, the cost of somebody pitching up at the local authority's offices and looking at the material rather than sitting in an office and waiting for it.
That in itself is an expense, so it would not be a great disaster for the consumer—the noble Lord, Lord Rooker, has rightly talked of the Bill as a consumer Bill—if the cost to the local authority of personal searches was covered, because officers have to go and get the files and so on. It is unlikely to add very greatly to the cost for the consumer, but would be fair to the local authority.
Lord Rooker: I have good news—it is a good news day or a good news amendment—although it is only partial good news. I do not want to oversell it.
Amendment No. 201 seeks to give the Secretary of State the power to enable local authorities to set their own fees for services provided under the Local Land Charges Act 1975 and the Commons Registration Act 1965, including for searches of the relevant registers. That is similar to an amendment discussed in Committee in the other place. The Minister with responsibility for housing said then that these fees are not restricted to housing matters. The wording of this
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amendment might have the unfortunate consequence of allowing only fees relating to residential properties to be devolved to local authorities.
Local land charge fees in England and Wales are currently set by the Lord Chancellor with the concurrence of the Treasury. For England, deregulation of the setting of these fees is part of the Government's strategy for implementing the local government White Paper. The Government have supported David Borrow's Local Land Charges (Fees) Bill. However, it is unlikely that that Bill will complete its parliamentary stages in this Session. I can now confirm that the Government are intending to bring forward an amendment to the Constitutional Reform Bill which would devolve to local authorities in England the power to set fees for local land charge services, with the exception of personal search fees.
In relation to local land charges services in Wales, including personal search fees, the Government have agreed to the National Assembly's proposal to transfer fee-setting powers to the Assembly. A transfer of functions order to achieve that is to be laid before Parliament by the Secretary of State for Wales shortly.
Personal search fees are excepted from the proposals for England because they present some difficult issues. A full review is to be undertaken before any decision is made. It would be premature to set a date for that review until we know the scope of the study that the Office of Fair Trading is planning to conduct into the property search market. The National Assembly for Wales has confirmed that it will not use its powers to set personal search fees in Wales until it has undertaken a review of those fees. It is expected that the National Assembly will join in a review of personal search fees across England and Wales.
Setting fees for searches of the common land register is a matter for my right honourable friend the Secretary of State for Environment, Food and Rural Affairs. Defra is currently considering a package of reforms to the registers, and plans to introduce primary legislation as soon as possible. Information in the local land charges register and information about common land would fall within the ambit of Clause 144(5)(c) as relevant information for the home information pack. However, charging powers in relation to the provision of such information is very much a matter for other legislation, as I have explained.
Progress is on the way. I hope that, in the light of those comments, the noble Baroness will be more than satisfied that that was a very positive response to a fully worked-up amendment that, sadly, I cannot accept.
Lord Avebury: Is it not possible that, one day, all the information will be digitised, and that the consumers will be able to make the searches for themselves without paying professional fees?
Lord Rooker: Probably, one day.
Baroness Hanham: The answer to my amendment seems to be, "Yes, but not now". I accept that, although it is a great pity that it cannot be put into the legislation. I thank the Minister for his reply and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 144 agreed to.
Clause 145 [Home condition reports]:
[Amendment No. 202 not moved.]
Baroness Hanham Baroness Hanham moved Amendment No. 203:
Page 99, line 35, leave out "may" and insert "shall"
The noble Baroness said: Amendments Nos. 203 to 205 are grouped together. They suggest that, when regulations are put in place, the home condition reports must be produced by someone adequately qualified to carry out the task. Those who carry out the reports must be able to inspire the trust of the purchaser. If we are to have the home information packs foisted on us, for goodness' sake let us at least make sure that they are worth the paper on which they are written.
I refer back to the amendment regarding the suitability of the reports to mortgage lenders. In order for the reports to have any credibility at all in the marketplace, they must be prepared in such a way and by such a qualified person that they are fit for the task. Having language such as,
"regulations may require a home condition report to be made by an individual who is a member of an approved certification scheme",
in the clause is not at all helpful. It suggests that anyone may be in the position to produce such a report and that, if necessary, the house seller can scratch one together.
I recall the Minister saying earlier that there would be a training programme for the inspectors, and I recall reading elsewhere that an NVQ would be required for home inspectors. An NVQ is nowhere near the qualification of a chartered surveyor, the person who currently does the surveys. One of the most important aspects of the reports will be that they are of sufficient quality to enable everyone to rely on them, otherwise exactly what I suggested before will happen—they will not be worth the paper on which they are written, people will not rely on them, and buyers will simply get their own searches and surveys done at the normal expense to them, and thereby will not really save anything at all.
Therefore, it is extremely important that we know what the training scheme for the home inspectors will entail. We should know the level of the qualification that they will be required to have if they carry out this work, the extent of the training and what is involved. I beg to move.
11.30 p.m.
Lord Bassam of Brighton: Clause 145(4) enables the Secretary of State to make provision for the approval of one or more certification schemes. Subsection (5) lists a number of points on which the Secretary of State
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would need to be satisfied before approving a scheme. They include home inspectors being fit and proper persons to carry out home condition reports, having adequate indemnity insurance and a complaint resolution procedure being in place.
Amendment No. 203 would replace the word "may" with "shall" in subsection (3) of Clause 145. We think that it is appropriate to use the word "may" rather than "shall" in this instance as there is no requirement for the regulations empowered by Clause 144 to be made. However, the use of the word "may" does not imply that the regulations will not be made, nor that home condition reports will be carried out other than by members of an approved certification scheme. The rest of the provisions in the Bill cannot work unless the contents of the pack are prescribed in regulations. I can assure the noble Baroness that the Secretary of State has every intention, after full consultation with interested parties, of making regulations under Clause 144 which will deal with the provisions in Clause 145.
As I said, Clause 145(4) allows the Secretary of State to approve one or more certification schemes. The effect of Amendment No. 204 would be to restrict that power so that only one scheme could be approved at any one time, effectively giving the scheme a monopoly over the certification of home inspectors. I do not know whether that was the noble Baroness's intention but that is what its effect would be. We do not consider that that step would be in the best interests of home inspectors or ultimately, perhaps more importantly, consumers. In the event that the certification scheme was failing, it would be difficult for a second scheme to be introduced quickly enough to offer a viable alternative. Therefore, if the amendment were at some stage to be successful, effectively it would create a monopoly situation which would not work to the benefit of the consumer or supplier of the service.
While there would be the advantage of certainty in having a single scheme—we have no current reasons to believe that approval is likely to be sought for more than one—I think it is important for the Secretary of State to have some flexibility here to approve another scheme or schemes if that were to become necessary or desirable. Crucially, whether it is one scheme, two or three, all will have to meet the same exacting standards. Listening to what the noble Baroness said, that is probably a shared objective because we all want to ensure that the home condition report is a document of value.
Amendment No. 205 would require the Secretary of State to approve any qualification and training schemes set up to train home inspectors. We do not think that that is either necessary or practicable, for the reasons that I shall now set out. As part of the process of approving a certification scheme, the Secretary of State will need to be satisfied about its arrangements for ensuring that applicants for membership are properly competent.
In September 2003, the Qualifications and Curriculum Authority approved national occupational standards for home inspectors. The standards clearly set out the skills and knowledge that

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should be acquired by home inspectors. Candidates should be trained and assessed to ensure that they meet prescribed standards.
Rather than have a single, one-size-fits-all training course, we propose to allow competition and choice. We envisage that the certification scheme will appoint an awarding body or bodies that will establish qualifications in home inspection. That process is already well under way. On 1 September this year, the Qualifications and Curriculum Authority approved a qualification in home inspection, submitted by the Awarding Body for the Built Environment, in the expectation of Royal Assent and subsequent approval of the ABBE as an awarding body.
In turn, the awarding body could appoint assessment centres that can assess and give credit for candidates' prior knowledge and experience and identify any gaps where additional training is required. We expect that these training needs will be filled, for example, through courses provided by universities or colleges or major employers of surveyors. All candidates would then need to sit a final test set and marked by the awarding body before being awarded the home inspection qualification required to be admitted to membership of a certification scheme.
That seems to us to be an effective and entirely appropriate regime for ensuring that home inspectors are appropriately qualified and trained. Obviously, we have worked hard with the potential awarding bodies, the university sector, the professional organisations and so forth to ensure that what we have set up and designed works effectively so that there can be trust and confidence in home inspectors and their product; that is, the report. I hope that that helps the noble Baroness.
The Earl of Caithness: Perhaps I may ask the Minister a question on this qualification. It follows the answer that the noble Lord, Lord Rooker, kindly gave me last week. I have been looking for it for the last couple of minutes and cannot find it. I asked about the costs that had been paid to a company called SAVA, which is now no longer anything to do with the ODPM but those that were involved in that section of SAVA have now set up a company called Property Industry Research Limited (PIR) and have a big contract with the ODPM.
From memory the Minister's letter said that the total of the contracts first to SAVA and now to PIR are something in excess of £2 million. Later in the paragraph he mentions another figure of £2 million. That figure, coincidentally, is the same as the total of the two figures that he gave me earlier for SAVA and PIR. Can he confirm that the total amount of the contract is just over £2 million or is it £4.2 million or thereabouts?
Lord Bassam of Brighton: My noble friend Lord Rooker has provided me with a copy of this. The total value of the contract is £2,114,913.
The Earl of Caithness: Is that the total that the ODPM has so far spent on these two companies in the contract, and that will be the end of it?
Lord Bassam of Brighton: All I can say to the noble Earl is that that is the total value of the contract.
Baroness Hanham: It is too late to go into the details of this but what we will need to be satisfied about—I am not satisfied yet—is that the training of these inspectors will be such that they will be in a position to do a survey which is adequate; in fact, not adequate, more than adequate. If the home condition survey is not comparable to the survey which is carried out on premises at the moment, buyers will not rely upon it. It is terribly important that we get clear the standard of this home condition report. Does the Minister agree with that?
Lord Bassam of Brighton: I want to agree with the noble Baroness in this sense. It is one of those situations where we are not quite comparing like with like. I understand what the noble Baroness says, but home inspectors will not need to be qualified to what one might describe as the full RICS standard, largely because they are not undertaking the full range of tasks that are included in the chartered surveyor's qualification. I think the noble Baroness needs to accept that point. However, that said, we want them to be of a very high standard indeed.
We have worked very hard with the relevant bodies so that we can have confidence in this and so that the market itself and those institutions and bodies which are part of the market are satisfied. That work has been ongoing. As I said earlier, we have had very extensive discussions with stakeholders to ensure that we achieve the very high standard that will be required so that confidence can be assured.
No doubt the noble Baroness will want to tease more of that out at a later stage, but that is our intention. We recognise the essential importance of the issue.
Baroness Hanham: I thank the Minister for his reply. For today, we beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 204 and 205 not moved.]
Baroness Maddock Baroness Maddock moved Amendment No. 205A:
Page 100, line 3, at end insert—
"( ) for ensuring that members of the scheme are completely independent and have no links financial or otherwise with the responsible person;"
The noble Baroness said: Amendment No. 205A amends Clause 145 by dealing with regulations that may be made concerning members of approved certification schemes. The purpose of the amendment is to make it absolutely clear that home inspectors

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must be independent. The hour is late but this is an important amendment. It is absolutely essential for buyers to know that home inspectors are completely independent if they are going to have the confidence to rely on home condition reports commissioned by sellers. Given the decisions we have had about these reports already this evening, that is very important.
Members of a scheme who are linked to estate agents, mortgage lenders, building fabric warranty providers and financial product providers may not sufficiently protect the consumer in our view. I think that this is a difficult issue. We believe that independence is an important consumer protection for both sellers and buyers to ensure that pressures are not brought to bear on members of a scheme which could influence the contents of the report.
I hope that the Government agree with us on this. They may not think that the amendment should be here, and they may have made provision for it elsewhere in the Bill where we have not found it. However, I think that the issue is important. I beg to move.
The Earl of Caithness: My Amendment No. 208A and Amendment No. 209, in the name of my noble friend Lady Hanham and myself, are grouped. The noble Baroness, Lady Maddock, is absolutely right. This is a fundamental and crucial amendment to how this part of the Bill is going to work. It is a consumer protection amendment. I am sorry that the noble Lord, Lord Borrie, is not in his place because I think that on this occasion he would probably be with us.
Given the advocacy and passion with which the Government have promoted the Bill, one might well have thought that many other countries in the world are ready to follow this lead and the unprecedented step that the Government are taking for England and Wales. But the silence is deafening. Nobody is following what the Government are advocating in Part 5 of the Bill.
The reason for that is simple. The surveyor must be totally independent from all other parties. In the US, it is illegal for there to be any link between home inspectors and the selling agent. Financial institutions are not allowed to own an estate agency chain as their view is that a consumer needs independent financial advice on a mortgage, not from someone selling a property. If transgressions are found, a practitioner can lose his state licence. That is very different from what is happening in the UK, where it is not a question of a conflict of interest but more of a vested interest.
I have concerns about the home condition inspector being responsible to the seller, the buyer and the lender. Those concerns have been somewhat eased by the Minister's comments that the home condition report does not need to be updated. All the surveyor—but let us not call him a surveyor as he does not have the qualifications of a surveyor: he will have the qualifications of an inspector, which are not the same and of a lesser standard—all the inspector will have to say is, "At the time that I did the report it was right, but that was nine months ago. It is now up to the vendor or
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the purchaser to get an up-to-date survey. You prove that what I said nine months ago was wrong". That is not a good position for an inspector to be in. It gives him a get out clause. But we still have the position where the inspector is responsible and can be sued by three different parties.
11.45 p.m.
Another group that has a vested interest is my institution, the Royal Institution of Chartered Surveyors. All those who have the proper surveying qualifications automatically have the qualifications to be a home inspector. It is not surprising that many firms see this as a good way to increase the turnover of their business without adding to costs.
I move on to an agency that has been giving the Government a lot of advice and which the Government seem to think to be rather good news—Countrywide Assured. But it has a vested interest, in that it is seeking to become a one-stop-shop. If one looks at its annual statement in 2000, it states that it had recently taken an investment amounting to 47 per cent of equity shares in Teramedia, a company that has been granted a licence to access and provide Land Registry and local authority searches electronically. Countrywide also has surveyors. So within one building, within one firm, actions are being taken against the interests of the consumer because if one goes to that firm, it will say that it can recommend a surveyor, who happens to be sitting at a desk there, and that, of course, he will be independent. No, he cannot be independent, he is working for that firm and that is utterly unacceptable.
On a smaller scale, let us turn to the case of Maria Coleman. When she did the pilot scheme in Bristol, she was in control of a company promoting the sale of voluntary seller's pack schemes to estate agents. I asked the Minister yesterday whether she declared that interest to the Government. At the moment, as far as I can see from her website, she is selling 16 properties. That is not the basis on which the Government of this country should be making legislation. That is quite wrong. I must press the Government for an answer. Did Maria Coleman advise the ODPM or the Government of her dual interest, her conflict of interest?
This is where the trouble is going to begin. This is where there will be a huge amount of consumer resistance. At the moment, packs are voluntary, but when all the packs become compulsory and consumers start to wake up to the fact that, rather than getting independent advice, they are getting advice from people who are selling properties as well as being surveyors, or who are working within the same firm, or who are controlled by a financial institution, like the lenders, then consumers will lose even more confidence in the housing market and the way it works.
The noble Lord, Lord Rooker, read out seven examples from letters. Those letters are nothing in comparison to the letters he will get in a few years' time. In a few years' time, the letters are going to say exactly the same thing, but they will have this sentence:

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"You misled us; you told us that this was going to be a better system". No, it is not a better system but one way we can improve what is proposed by the Government is to have the inspector totally separate and verifiably independent from any of the other institutions: from the purchaser, the vendor and the lender.
Lord Bassam of Brighton: Amendment No. 205A would require that home inspectors are "independent". The amendment does not really give any more depth than that, but it is an important statement in itself. The home condition report should of course be completely objective. We recognise and understand the concern that this objectivity could be compromised if there were to be any potential or actual conflict of interest. I know that there is a particular concern about risks where, for example, the home inspector and the seller's estate agent are employed by the same company.
However, the Government believe that the checks and balances that we intend to put into place will ensure that those fears, while completely understandable, are misplaced. We intend to tackle those risks through the regulations made in accordance with Clauses 144 and 145 and the terms under which the home inspectors will belong to the certification scheme. All the main stakeholders, including the Council of Mortgage Lenders and the Consumers' Association are involved in that work. Certification schemes will not be approved unless all the interested parties can rely on those reports.
I will outline some of the checks and balances. First, we intend that the guidance will be made available. It will set out clearly what the home inspector must do when preparing a home condition report. If the inspector fails to act correctly, that will be readily apparent. Secondly, we intend that inspectors will be required to make a "related parties" statement on the front page of the home condition report if the firm is related to that of the estate agent selling the property. That will make any link fully transparent.
Thirdly, we expect that approval will be granted to a certification scheme only if it clearly establishes the duties and responsibilities of home inspectors and publishes clear guidance about the conduct expected of inspectors, particularly in cases of perceived and actual conflicts of interest. Furthermore, approval will be granted only to certification schemes that monitor and audit the work of home inspectors.
The evidence from our research—and the practical experience of those operating voluntary home information packs in the real world—is that most buyers are prepared to trust a report that is provided by the seller now. Our objective is to ensure that when home condition reports are being provided under the terms of an approved certification scheme, they will be completely above suspicion. In that respect, our aim is to ensure that home condition reports will be regarded in much the same way as an RAC or AA report on a second-hand car is regarded now.
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Any home inspector producing a report in a manner that is partial to one party risks being sued by the other and a claim against indemnity insurance will impact on renewal terms. That would also be likely to trigger a complaint to the certification scheme, which could lead to sanctions and even expulsion from membership of the scheme and the loss of livelihood. In summary, that robust package of safeguards will ensure the objectivity of home condition reports.
Amendment No. 208 seeks to delay the implementation of the certification scheme until the Secretary of State is satisfied. I apologise, I should have turned to Amendment No. 208A. The points in respect of Amendment No. 208A are similar to those for Amendment No. 205A. Again, we understood the concerns, but the checks and balances that we have put in place will cover the points that are of concern to the noble Earl.
Amendment No. 209 seeks to delete Clause 145(7). As we have explained many times, Clause 144 contains the general powers for the Secretary of State to prescribe by regulations the documents required to be included in a home information pack and information to be included in, or excluded from, those documents. Regulations regarding the inclusion of a home condition report in the pack would be made under the powers in Clause 144.
Clause 145 is supplementary to Clause 144. It makes provision for what may be required in any Clause 144 regulations made in relation to home condition reports. It also sets out points on which any regulations shall require the Secretary of State to be satisfied before approving a certification scheme for the production of home condition reports.
Clause 145(7) confirms that nothing in Clause 145 limits the Secretary of State's powers under Clause 144 to make provision about home condition reports in regulations. That is the case because Clause 145(3) provides only that the Secretary of State may require in regulations that a home condition report must be prepared by an individual who is a member of an approved certification scheme. It does not require him to do so. Only if the Secretary of State makes a requirement must he make provision for the approval of certification schemes and for the schemes to contain appropriate provision for the arrangements regarding qualifications, indemnity insurance and other aspects set out in Clause 145(5).
I appreciate that that is a technical point, but given the knowledge available on the Opposition Benches and the fact that we have dispatched consultation papers on the pack's contents specifically proposing the inclusion of a home condition report supported by one or more of the certification schemes, I hope that it will be understood. Clause 145 is not intended to provide an exhaustive list of what might be provided in regulations regarding home condition reports. It may prove necessary for regulations to cover considerations not mentioned in that clause: possible examples are monitoring and auditing arrangements and provision for insurance of last resort; that is, cover

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to protect the homebuyer should the home inspector's run-off cover have lapsed, for example, following his death.
Accordingly, for the avoidance of doubt, Clause 145(7) provides that nothing in Clause 145 limits the Secretary of State's power under Clause 144 to make provision about home condition reports and regulations. I hope that that has covered the issues of concern relating to the amendments.
To answer the specific point raised by the noble Earl, Lord Caithness, concerning Maria Coleman, the Government have always been aware of her commercial interests in estate agency and home information packs. She was operating packs before the Government prepared these proposals, so it has been well known to us for some time. We have acted entirely properly and taken good advice in bringing forward our proposals. I hope that the noble Earl will accept that we have acted in good faith, as I am sure he does.
The Earl of Caithness: I listened with care to what the Minister said in reply. I shall read carefully his response when it is printed in the Official Report. There is a fundamental difference between mine and the Government's position and indeed that of the noble Baroness, Lady Maddock. From the consumer's point of view, if home information packs and home condition reports are to be foisted on the public, the inspector must be totally independent from any other party. That is crucial for consumer confidence and for the reputation of the scheme that the Government propose.
The Minister and I could argue all night about that, but we are coming from fundamentally different positions. I believe that it is absolutely right that the inspector is totally independent. The Government do not care: they think that they can control it by regulations and that they can bring in enough checks and balances to ensure that the public are not put at a disadvantage. I do not believe it for a moment: it just will not work.
Baroness Maddock: As I said in moving the amendment—and the noble Earl, Lord Caithness, expressed the same firm opinion—this is an important matter. I shall have to read carefully in Hansard what the Minister said. He gave a long reply; it is late and we are all tired. Between now and Report stage will the Minister spell out a little more clearly the checks and balances about which he has been talking? That seems to be where the difference is between us. We are saying that we want to be independent: the Minister is saying yes, we have put things in place but we will ensure their independence. That is the point on which we need to be reassured.
Lord Bassam of Brighton: I appreciate what the noble Baroness is saying. I cannot be specific, but we will see what we can do to give some further comfort on that point. I recognise the centrality and importance of the issue. We want to get it right and ensure that home inspectors and home inspection
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reports are worth the paper on which they are written—that is everyone's objective and it is in everyone's interests that that is the case.
Baroness Maddock: At the present stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Midnight
Baroness Hanham Baroness Hanham moved Amendment No. 206:
Page 100, line 5, at end insert "which may be achieved by the government underwriting scheme"
The noble Baroness said: Clause 145(5)(b) states that the Government will make regulations in regard to an indemnity insurance that must be available to home inspectors. We understand that many people representing the surveying community, the mortgage lenders and, indeed, the consumers themselves are concerned that there is a dearth of firms wanting to underwrite the work of the inspectors.
This is obviously of enormous concern. If that is still the situation, it will be inevitable that the Government will have to underwrite a scheme of insurance to enable the whole project to get off the ground. That is the purpose of the amendment, briefly and quickly at this time of night, and I am sure the Minister has a respectable answer. I beg to move.
Lord Rooker: He certainly does. Satisfactory insurance is absolutely essential to ensure that consumers and lenders can rely on the home condition report. The insurance needs of home inspectors have been the subject of extensive research and discussion with stakeholders. This includes research carried out on behalf of the Office of the Deputy Prime Minister by several consultants into suitable means of providing a robust insurance regime, which will include insurance of last resort to be provided by the certification scheme. We are confident that it will be made available.
Assisted by the Association of British Insurers and the industry working group advising us on insurance matters, discussions are continuing with commercial insurers to identify options based on a commercial approach. The possible basis for an insurance regime will be published when this further work is complete. We do not intend to introduce compulsory home condition reports until we are absolutely certain that satisfactory insurance arrangements are available. We are confident that adequate insurance will be available without the need for a government guarantee.
Baroness Hanham: I thank the Minister for that reply. I hope his confidence is justified. It could not have been justified a little while ago because concerns have been expressed to us ever since the Bill was published. We will keep a watching brief on this. It may very well be worth coming back to it on Report to see how matters are progressing. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 206A not moved.]
Baroness Hanhamhad given notice of her intention to move Amendment No. 207:
Page 100, line 10, at end insert "; and
(f) a home condition report must be no more than three months old at the point at which a property is marketed"
The noble Baroness said: We have discussed at considerable length the time links of home condition reports. The Minister replied earlier—he did not satisfy us—and I do not believe there is any benefit in moving the amendment now because we will come back to the whole process later.
The Minister said the report could be three months old when it was first put into the pack. The amendment would not allow it a life expectancy of more than three months. I am not going to move the amendment tonight because we will have to come back to it.
The Chairman of Committees: The noble Baroness must not speak to amendments which are not moved.
[Amendment No. 207 not moved.]
Baroness Hanham Baroness Hanham moved Amendment No. 208:
Page 100, line 10, at end insert—
"( ) The Secretary of State will delay the implementation of the appropriate certification scheme outlined in subsection (5) until he is satisfied that there are enough members of such a scheme to meet demand."
The noble Baroness said: I shall speak to this amendment because I am going to move it. I like to explain as I go along what is happening. I got it all wrong. I do the wrong thing and the Minister does the wrong thing.
The amendment reflects a genuine concern of the Royal Institution of Chartered Surveyors that in order for the task of providing home information packs to be carried out effectively at least 7,000 inspectors need to be trained and ready by the time that the home information packs are rolled out across the country. Having said that, although I am happy to accept the institution's estimate, we must be able to allow ourselves a little latitude in this regard.
It comes back to the quality of training and the regulation and maintenance of consistently high standards that will instil trust in consumers, mortgage lenders and probably the estate agents themselves. If the institution's estimate is short and the initial number of 7,000 qualified surveyors is overwhelmed in the first two weeks, it will be little short of catastrophic for both the housing market and the Act. The Secretary of State must have leeway and, again, discretion in the implementation of home condition reports. I beg to move.
Lord Rooker: The amendment would delay the implementation of the certification scheme until the Secretary of State is satisfied that there are enough home condition inspectors to meet demand.
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I am delighted to reassure the Committee, as would be every Minister, because we all come and go, that there is absolutely no question of implementing mandatory home condition reports until we are absolutely satisfied that there are sufficient qualified and insured home inspectors available to do the necessary work. Before taking any decision on that, the Secretary of State will of course seek the views of stakeholders.
As I have said repeatedly, we are working closely with those stakeholders, including property professionals, and we are confident that the required numbers of home inspectors can be in place by January 2007. We concur with industry estimates that in the region of 7,500 people will be needed. Some of them will work full time and others part time on preparing home condition reports.
I am pleased to say that there is considerable interest from existing surveyors and related professions and trades. For example, 5,500 chartered surveyors have expressed interest to the Royal Institution of Chartered Surveyors in becoming home inspectors and that does not take account of a further 1,200 surveyors employed by corporate surveying firms. Added to those 6,700 or so chartered surveyors are many members of other bodies, including architects and other building professionals.
We know that a lot of concern has been expressed about the availability of suitable recruits, but I hope that, having heard those kinds of figures in September 2004, Members of the Committee will see that our expectation of having in place by January 2007 the necessary 7,000 full and part-time inspectors is justifiable. There is still work to be done, but, contrary to some of the comments that have been made today, there is a willingness among professionals to make the scheme work and it looks as though there will be enough people to make sure that that happens.
Baroness Hanham: The Minister has said throughout our discussion that 40,000 houses come up for sale each week. Each of those 7,000 qualified people, with half of them on holiday and a quarter of them sick, will be doing at least four home condition reports a day. I hope the Minister is correct. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Rooker: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at eight minutes after midnight.