Lords Sitting of 16 September 2004

Preamble
The House met at eleven of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Newcastle.

Directors' Remuneration
Lord Smith of Clifton Lord Smith of Clifton asked Her Majesty's Government:
What conclusions have so far been drawn up by the Department of Trade and Industry monitoring unit on directors' remuneration, since the unit was set up last February.
Lord Davies of Oldham: My Lords, my right honourable friend the Secretary of State for Trade and Industry made a Written Statement to Parliament about directors' remuneration, performance contracts and severance on 25 February 2004, announcing that the Department of Trade and Industry would commission an external assessment of compliance with the Directors' Remuneration Report Regulations and changes in remuneration practices during the course of this year's AGM season. Deloitte & Touche has been appointed to this role and will submit its reports to the department this autumn.
Lord Lea of Crondall: My Lords—
Lord Smith of Clifton: My Lords, I thank the noble Lord for that reply, and I thank the noble Lord, Lord Lea, for not jumping the gun. The Guardian reported a 288 per cent increase in remuneration levels over the past 10 years compared with an increase in average earnings of 45 per cent. Top remuneration packages of such a magnitude are, frankly, looting investors. It is time that the Government did not outsource inquiries on such issues. I think that the senior partner in Deloitte is among the fat cats about whom we are talking, so I hope that the company declares an interest when it gives its assessment.
Failure continues to be rewarded. We have seen it this week in the cases of Jarvis directors and Sir Peter Davis at Sainsbury. It makes a mockery of good corporate governance. The Government cannot keep hiding behind assessments and so on. They should deal with this problem and amend the Companies Act, as the noble Lord, Lord Triesman, indicated in his reply to me on 25 February. Does the Minister not agree?
Lord Davies of Oldham: My Lords, I am glad that there was a question right at the end, although I very much enjoyed the diatribe. As the noble Lord indicated, there are statistics going back over a number of years, which is why the regulations were introduced two years ago. During the first year in which the regulations have been effective, shareholders have had
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the chance at annual general meetings to hold companies to account in these terms and considerable progress has been made. There will always be one or two instances that hit the headlines; the noble Lord referred to one of them. The regulations are effecting beneficial change. It is only right that we await Deloitte & Touche's report to obtain its analysis of how the system works and whether emendation is necessary.
Lord Lea of Crondall: My Lords, I was merely signalling earlier my intention to ask a helpful question, albeit in a somewhat unorthodox manner.
Some of us have doubts about the doctrine of shareholder democracy. There is a lot of evidence that remuneration committees operate, not against market forces, but in an oligopoly. Research shows that in many cases they operate the upper-quartile principle, which in layman's language means, "You scratch my back; I'll scratch yours". I suspect that that will apply to Deloitte & Touche's report also, but I hope that I am wrong. Will the Minister take on board that we need the unit to do some serious work about the operation of remuneration committees, having regard to the fact that the issue is increasingly becoming a national scandal and that it will be very hard to retain moral support for income restraint across the rest of the economy if it goes on like this?
Lord Davies of Oldham: My Lords, I recognise my noble friend's impatience, indicated by his eagerness to put his question. I have some sympathy with his statement and with that of the noble Lord, Lord Smith, that previous abuses have caused considerable public concern. I reiterate my response to the first Question: we await an analysis of the position. We are encouraged by what has occurred over the past 15 months. Greater openness is making issues more transparent to shareholders, and in some well publicised cases it has resulted in significant second thoughts by the board. I hear what my noble friend says. I am sure that, after many years of showing considerable patience, the noble Lord will be able to extend it for the short period until we have the benefit of the report. Then we will be able to look further at the situation.
Lord Marsh: My Lords, I would welcome elucidation on an aspect of the subject that has always puzzled me. If shareholders do not like the way that a company in which they have put their money is run, for whatever reason, why cannot they sell the shares and transfer their affections?
Lord Davies of Oldham: My Lords, that probably goes on. It has not gone unnoticed that one of the companies that is currently in the limelight because of its remuneration of directors has seen, for all sorts of reasons, a massive decline in its share price, which is a reflection of loss of confidence. Withdrawal from the fray is one condign action that shareholders can take but surely it would be better for the health of companies and the good of the economy if shareholders were

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empowered and had the information to take decisions that helped to change behaviour rather than just pulling the plug on the whole activity.
Baroness O'Cathain: My Lords—
Lord Wright of Richmond: My Lords—
The Minister of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, we have not yet heard from the Conservative Benches.
Baroness O'Cathain: My Lords, is there any thinking that perhaps the make-up of the members of the remuneration committee should be looked at? Under the combined code, the audit committees now have to be made up of members who have financial competence in areas such as accountancy and banking, for example. There could be a case for suggesting to corporations that members of the remuneration committee should likewise be well versed in all the intricacies of remuneration. In that way, we might avoid the very prevalent trend of going for upper quartile for non-upper quartile performance.
Lord Davies of Oldham: My Lords, I recognise the noble Baroness's point about the complexities of remuneration. The report from Deloitte & Touche, which we await with some eagerness, will no doubt have significant things to say about the make-up of remuneration committees, their competence and, to reflect the point of my noble friend Lord Lea, whether they are sufficiently representative.

Disabled Residents: Unadopted Roads
11.14 a.m.
Lord Beaumont of Whitley Lord Beaumont of Whitley asked Her Majesty's Government:
What steps they are taking to ensure that disabled residents living on unadopted roads will be able to take full advantage of the provisions in the draft Disability Discrimination Bill.
Lord Davies of Oldham: My Lords, the provisions of the draft Disability Discrimination Bill would place public authorities under a duty not to discriminate against disabled people when exercising any of their functions and would require them to promote equality of opportunity. Local authorities have no mandatory duties in respect of unadopted roads, and the Bill's provisions would not change that position.
Lord Beaumont of Whitley: My Lords, I thank the noble Lord to a certain extent for that Answer. I know that he knows that there are about 40,000 unadopted roads in England, because we have discussed this before. Does he know that many of them, particularly in the north of England, are in such a state of disrepair
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and are so badly lit that disabled people cannot safely leave their houses? Does he not think that it is time that the national Government should fill this breach in our welfare provisions by taking over responsibility?
Lord Davies of Oldham: My Lords, when the noble Lord says that I know that there are 40,000 unadopted roads in the United Kingdom, I do so on the basis of 1972 statistics, which are the latest we have.
In response to the noble Lord's broader point, he will recognise that it is for frontagers on such roads to make up their mind whether the road is sufficiently secure for them to go about their business. If there are disabled people who have particular difficulties, they must get together with their neighbours to approach the local authority. But if local authorities took on every single unadopted road in this country, the cost would be £3 billion. That is a mighty large slice out of the transport budget.
Lord Addington: My Lords, does the Minister agree that such confusion within a major piece of disability legislation is one of the major problems in this field? Are the Government prepared at least to clarify the situation when the Bill comes before Parliament? At the moment, it appears that you are allowed to travel if you are disabled unless you need to go to an address on an unadopted road.
Lord Davies of Oldham: My Lords, the Bill relates to public transport and the obligations upon public transport to guarantee that disabled people can travel as readily as anyone else. However, public transport does not ply down unadopted roads, in the main, for fairly obvious reasons. I repeat that if we accepted a public responsibility for all unadopted roads, it would be a major cost which would be difficult to justify when we know that very large numbers of unadopted roads are in that state because the frontagers are determined that they should remain that way. That is their decision and their right.
Lord Brooke of Sutton Mandeville: My Lords, as the Minister also answered the last Question from the noble Lord, Lord Beaumont, on unadopted roads, will he let me add a footnote to my quotation from Betjeman on that occasion, to which he responded? I have since verified that Miss Joan Hunter Dunn was the catering manager at the Ministry of Information during the war, based in Senate House at the University of London, where Betjeman served for a short period.
Lord Davies of Oldham: My Lords, the whole House is always grateful for any information we get from the noble Lord, but on this occasion we are doubly grateful.
Lord Addington: My Lords, does the noble Lord agree that the clarification of providers of goods and

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services might be an avenue for the Government to consider? We do not want to go to case-made law to sort this out.
Lord Davies of Oldham: My Lords, I hear what the noble Lord says. He will recognise that the Bill we are introducing has had the benefit of pre-legislative scrutiny, which will aid its passage through Parliament. The House will have its opportunity to consider the legislation, when all these points will be taken into account. However, I understand what the noble Lord says about road surfaces and services to the disabled in our community. We shall certainly discuss those points when the Bill is before us.
Earl Attlee: My Lords, how does the Minister know what the cost of adopting all the roads is when he does not have an up-to-date catalogue?
Lord Davies of Oldham: My Lords, that is a fair point. We are in the land of conjecture and guesswork on this issue, because we do not keep an up-to-date register of unadopted roads because they are not of public concern, nor is there any public expenditure on them. They are private roads with private rights. However, we have that figure from 1972. Only a small number of roads move from the unadopted to the adopted category each year. When one speaks of billions, it is from a vague perspective on a large number of roads. When each one is now adopted, we have a yardage cost that gives us a chance to produce a broad instrument. However, I am not of course defending the figures as categorical.

Palliative Care
11.21 a.m.
Baroness Finlay of Llandaff Baroness Finlay of Llandaff asked Her Majesty's Government:
What action they are taking to ensure equal access to palliative care.
The Parliamentary Under-Secretary of State, Department of Health (Lord Warner): My Lords, I refer the noble Baroness to the Government's response to the recent Health Select Committee inquiry into palliative care, published earlier today. Copies of that response have been placed in the Library. We welcome the 30 recommendations of the committee, which contribute towards our commitment to ensuring that, over time, palliative care is available to all who need it, irrespective of diagnosis and in whatever setting they are receiving care.
Baroness Finlay of Llandaff: My Lords, I thank the Minister for his reply and the Government for their response to the report. I declare an interest as one who works in palliative care. The Government's response recognises that funding has been inequitable and over-reliant on the voluntary sector. How will service planning be equitable without central co-ordination, particularly in exploring Marie Curie's model, and how will the
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Government ensure increased culturally sensitive education and training, particularly for healthcare professionals who work in areas of deprivation?
Lord Warner: My Lords, it is worth hearing in mind that the Health Select Committee praised the initiatives that the Government have taken to double the palliative care workforce. They have invested £50 million through the NHS Cancer Plan and provided specific funding for black and ethnic community projects and services for children. We have been working with Marie Curie on its economic model, which contains some interesting ideas. However, we recognise, as does Marie Curie, that some practical issues surround that particular model. As the Government's response shows, we are also taking issues forward as fast as is possible and practicable on a cooperative basis with the voluntary sector.
Baroness Greengross: My Lords, do the Government have plans to ensure that "whatever setting" includes facilities for those people who exercise their choice to die in their own home?
Lord Warner: Yes, my Lords, we support that approach. Following their commitment in the Building on the Best End of Life Care Initiative, the Government will be investing an additional £12 million during the next three years to improve care for people coming to the end of their lives, irrespective of diagnosis and setting.
Baroness Masham of Ilton: My Lords, is the Minister aware that some GP surgeries are putting a charge on nursing advice for those people who are living at home and who have to acquire nurses through agencies? Is that fair?
Lord Warner: My Lords, this is the first that I have heard of this problem. I am not briefed to give an authoritative answer, but I shall certainly look into the matter and write to the noble Baroness.
Earl Howe: My Lords, when one thinks of palliative care, one perhaps thinks most immediately of care for cancer patients, but there are many patients with other terminal conditions where palliative care is necessary. What work are the Government doing with the various non-cancer voluntary organisations to ensure that the programme for enhancing palliative care is rolled out equitably?
Lord Warner: My Lords, we have a range of contacts in the voluntary sector. As the noble Earl rightly said, we are committed to extending palliative care to people irrespective of their diagnosis. It is right that the major effort thus far has been made in relation to patients who suffer from cancer, but we are taking the issue forward on a co-operative basis with the voluntary sector and, after a cross-cutting review, the Government are committed to full cost recovery in the voluntary sector, which will help in this area.
Lord Patel: My Lords, does the Minister agree that a lack of integration of health and social care budgets for

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patients in palliative care is having an adverse effect on their care? What plans do the Government have to eliminate that anomaly?
Lord Warner: My Lords, it is always important to ensure good co-operation between social services and health services at the local level. There have been major advances in palliative care, which reflect rather well on co-operative working between the two services. That is reflected in the Health Select Committee's report. I am not quite as pessimistic as my noble friend because we have seen an expanding range of palliative care services in the community and in hospices. The trend is ever upwards. We are seeing good relationships also with the voluntary sector.
Lord Walton of Detchant: My Lords, in light of the Minister's previous point, does he agree that there is a widespread public misconception that palliative care is provided only in hospices and hospitals? Does he accept that palliative care is a philosophy of care that is increasingly extending out into the community? The public are to some extent misinformed about that. Does he accept that extending palliative care into the community is a major priority for the future?
Lord Warner: My Lords, the noble Lord, as so often, is absolutely right. The end-of-life care initiative that I mentioned will enable us also to skill up existing staff who already contribute to supportive and palliative care. Many of them are working to help people who wish to exercise their choice to die at home. I remind the House that the Government have provided 67,500 extra nurses since 1997. That is enabling us to increase the number of district nurses and palliative care nurse specialists, all of whom will be able to expand services for people who want to die at home.
Lord Addington: My Lords, it has been suggested to me that as the delayed discharges legislation did not cover hospices, there has been considerable slowness in discharging people from hospices to spend their last few days at home when they wish to do so. Will the Minister look into the matter to see whether it needs legislation?
Lord Warner: My Lords, there have been discussions on this matter. I know that it is under review. I shall look into it further and write to the noble Lord.
Lord Hayhoe: My Lords, in view of the splendid work that is done by children's hospices, has there been an increase in the support that is given to children's hospices from public funds in recent years?
Lord Warner: My Lords, more money has been going into hospices generally, as is recognised in the Health Select Committee's report. As to children's hospices, we know that the Big Lottery has provided £15 million to expand those facilities in recent years.
Lord Laming: My Lords, I am sure that the Minister would wish to pay a warm tribute to the many volunteers
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who contribute so much to that work. Does he also agree that it is very important that those volunteers are not exploited?
Lord Warner: My Lords, the noble Lord is absolutely right. A good deal of palliative support for people who are coming to the end of their lives is provided by volunteers, sometimes in hospitals and sometimes in people's own homes. I am sure that everybody in this House pays tribute to that splendid work. It is right that such people should not be exploited. The Government are expanding public services in those areas to achieve a good partnership between volunteers and public services.

Income Tax: Self-assessment
11.29 a.m.
Lord Dubs Lord Dubs asked Her Majesty's Government:
What they are doing to facilitate self-assessment in relation to income tax; and how effective the use of the Internet is in improving the accuracy of tax returns.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord McIntosh of Haringey): My Lords, the Inland Revenue continuously tries to make self-assessment as easy as possible. It has made changes recently which will give more than 2 million taxpayers an easier task. Many will no longer be required to complete a return, and others will be able to use a short tax return. The Inland Revenue has also enhanced the online system to offer taxpayers a wider range of services. Those who file electronically benefit from online help to prevent obvious mistakes in their returns.
Lord Dubs: My Lords, I welcome the Answer given by my noble friend. It shows that online self-assessment is a very efficient method for the taxpayer and for the Inland Revenue. Why then are there certain categories of individuals who are not allowed do their self-assessment online, which include Members of this House and of the other place?
Lord McIntosh of Haringey: My Lords, I am not allowed to do my return over the Internet and nor is my noble friend Lord Dubs. This is not a secret; I have discussed it with him. The reason is that there are special handling arrangements for those whose links with their employer apparently ought not to be disclosed for security reasons. However, it is true that a number of Members of this House are not able to file electronically and it is the intention of the Inland Revenue to reduce that number as far as possible and to make arrangements so that all Members can file over the Internet.
Baroness Noakes: My Lords, the last set of public service agreements had a 50 per cent target for electronic filing. That was subsequently refined—I think that is the term to 25 per cent for self-assessment. Will the Minister explain why the latest public service agreements

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contain no target for such filing? Is it because all the evidence points to the fact that these targets would simply not be met?
Lord McIntosh of Haringey: My Lords, the number of people who file electronically is increasing every year. There were over 1 million at the end of January this year; 1,080,000, I think. The total number of self-assessments is 9.5 million out of 30 million. My understanding is that Inland Revenue targets have been met in previous years.
Lord Sheldon: My Lords, I welcome the use of the Internet for making tax returns. Can my noble friend tell me how many taxpayers pay through the Internet and how many taxpayers receive statements of account via the Internet when it is requested by them?
Lord McIntosh of Haringey: My Lords, I do not have that figure. Clearly, the people who file via the Internet—I have already given a figure of over 1 million—must be given an opportunity to pay over the Internet when they have to pay. Of course, the number of people who pay other than by PAYE is a very small proportion of all taxpayers.
Lord Mackie of Benshie: My Lords, can the Minister tell us whether the Inland Revenue is gaining or losing by self-assessment?
Lord McIntosh of Haringey: My Lords, both taxpayers and the Inland Revenue are gaining by self-assessment. Taxpayers are gaining because they have less work to do and the Inland Revenue is gaining because the costs are less. I should add that when a return is filed over the Internet, it is analysed electronically. It does not have to return to paper and pencil in order to be calculated.
Lord Ezra: My Lords, is the Minister aware that there is evidence that the number of tax inquiries launched by the Inland Revenue has dramatically increased in recent times? Is this something that is due to the introduction of self-assessment or is it due to some other reason?
Lord McIntosh of Haringey: My Lords, I am not sure that I understand what the noble Lord, Lord Ezra, means by "tax inquiries". If they are the checks carried out by the Inland Revenue on discrepancies, then I am not sure that that is the case. But it could also mean checks that are made when there is a suspicion of a filing being deliberately inaccurate. In view of that ambiguity, I would rather write to the noble Lord, Lord Ezra, about that point.
Lord Dubs: My Lords, given my noble friend's Answer, and given that filing online is a purely voluntary activity, so that those who might have security concerns would obviously not do it that way, why can the Government not make an immediate decision and allow us all to file online right away? Is it because governments do not make immediate decisions?
Lord McIntosh of Haringey: My Lords, I am sure that that is part of the reason. The history of online
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filing is a little more complicated than that. There are two types of online filing. One is the original, which was introduced about 10 years ago and was mainly designed for advisers. The second is the Internet filing provision for individual taxpayers, which was introduced three or four years ago. To reconcile those, in order to make online filing possible for everybody, is a little more complicated than might appear.
Lord Newby: My Lords, in terms of the credibility of the system, will the Minister raise with the Inland Revenue the possibility of introducing de minimis limits in terms of fines for late payments? At present, if one submits a late claim for a repayment, one can get a demand for a fine of £0.00. This clearly brings the system into disrepute. Will the Minister consider that point?
Lord McIntosh of Haringey: My Lords, my understanding is that there are special arrangements for anything less that £2,000. I may be out of date on that. It sounds a sensible point and I shall look into it.
Lord Brook of Sutton Mandeville: My Lords, as we have a moment to spare, may I commend to the Treasury Bench a novel system of self-assessment? When my late noble kinsman was Financial Secretary to the Treasury, 50 years ago, he received a letter from an anonymous taxpayer. It said that he had been losing much sleep and had come to the conclusion that the loss of sleep was caused by his inaccurate tax reporting. He enclosed a banker's draft for £50,000 and added a postscript saying that if he continued to lose sleep, he would send some more.
Lord McIntosh of Haringey: What can I say, my Lords?

Hunting Bill
11.37 a.m.
Brought from the Commons, endorsed with the certificate from the Speaker (pursuant to the Parliament Acts 1911 and 1949) that the Bill as compared with the Hunting Bill of last Session contains only such alterations as are necessary owing to the time which has elapsed since the date of that Bill; read a first time, and ordered to be printed.
A suggested amendment was brought from the Commons pursuant to Section 2(4) of the Parliament Act 1911, and ordered to be printed.

Housing Bill
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 CHAIRMAN OF COMMITTEES in the Chair.]
Clause 145 [Home condition reports]:
[Amendments Nos. 208A to 210 not moved.]
Clause 145 agreed to.
Clause 146 [Enforcement authorities]:
Lord Rooker Lord Rooker moved Amendment No. 210ZA:
Page 100, line 21, leave out "this Part" and insert"—

(a) the duties under sections 137 to 141 and 147(4), and

(b) any duty imposed under section (Power to require estate agents to belong to a redress scheme)(1),"

The noble Lord said: With this amendment, we will discuss a host of other government amendments relating to estate agents. The introduction of home information packs will enhance the role for estate agents in the home buying and selling process. Agents will be marketing homes with home information packs and will also have the opportunity to be pack providers. As we have discussed in relation to earlier amendments, home information packs will cover a range of documents and information that is important to sellers and buyers and, indeed, to the whole transaction process. For probably the first time, agents will have full information about the property when the property is marketed. This will put agents in a central and highly influential position.
Your Lordships will be aware that the recent report from the Office of Fair Trading found a high degree of consumer dissatisfaction with estate agents. Among the report's recommendations was a suggestion that a power should be taken to impose a statutory redress scheme for use if voluntary codes of practice did not bring about sufficient improvement.
The OFT investigation and resulting report were largely concerned with the role of estate agents in the home buying and selling process as it exists today. The introduction of home information packs makes the imperative of a more effective consumer redress even more pressing.
The provisions set out in this group of government amendments are a variant of the OFT recommendation. They give the Secretary of State powers to approve one or more redress schemes and thereafter to require, by order, estate agents to become members of such a scheme. They provide also for the Secretary of State to withdraw any such approval. It would be open to any organisation or person to seek the Secretary of State's approval for a redress scheme. There could be more than one approved scheme. We hope that redress schemes will be run by the industry itself. We are holding discussions with the industry to bring this about. If it is necessary—although we hope that it will not be—the Secretary of State could establish a scheme himself. Sellers and buyers would be able to make complaints. The process would be independent and free to complainants. Members of an approved redress scheme would be under an obligation to abide by any recommendation or sanction resulting from an adjudication on a complaint.
Amendments Nos. 210ZA and 210ZB are consequential. They provide for local weights and measures authorities to enforce the duty to belong to a redress scheme, in addition to enforcing other duties relating to home information packs. We envisage that redress schemes may also operate on a voluntary basis. This voluntary element could relate to activities that are not connected with agents' activities with regard to home information packs.
Because this is a new proposal on which the Government have yet to consult—and brand new for the other place—we would not propose to exercise the power until it was clear what industry scheme or schemes would seek approval and what arrangements they would have for providing redress, including the fees that they would charge estate agents. Consultation needs to be carried out on the detailed arrangements, and a full regulatory impact assessment completed.
We are bringing forward this package of amendments as part of the package of measures that the Government announced in our response to the OFT report. The Department of Trade and Industry will also consult on proposals to improve transparency in this market and make enforcement of the legislation more effective. This is an important and timely consumer protection measure; it would provide consumers with an effective redress when estate agents marketing homes with packs fail to match up to the high standards of care that home buyers and sellers need.
I do not want to make long speeches, but this is a brand new package so it is important to put as much on the record as possible. There is a fairly narrow scope to the amendments and we do not really want to widen it; however, the House may wish to widen it—though after proper scrutiny, of course, not at this stage. We have sought to take maximum advantage of the opportunity provided by this Bill to bring forward this amendment to facilitate the introduction of a redress scheme. Of course, that means that we are, or were, constrained by the scope of the Bill.
The Bill is about marketing homes for sale with home information packs. Once it is in force we expect that the business of buying and selling a home will be heavily influenced, if not dominated, by the additional presence of home information packs. Consequently, the landscape will also change for estate agents. Many of the problems that cause consumers to complain may decline or even cease as a result of the packs. Equally some new problems may surface that the redress scheme will be called upon to take account of.
Therefore, it is difficult now, before home information packs are in place, to say what problems will arise that the redress scheme will cover. However, marketing homes for sale is probably the area that has given rise to most of the dissatisfaction—though not all of it—that consumers feel about estate agents. The redress measure will cover—and this is set out in subsection (6)(b)—an,
"act or omission affecting the complainant in the course of the estate agent's activities in relation to a home information pack that is (or will be) required for that property (including the giving of advice as to whether such a pack is required)".
It simply is not possible, within the scope of this Bill at present, to provide for redress schemes to cover all estate agents' activities—for example, commercial sales. But if it is the mood of the House that the scope of the scheme is more narrow than it needs to be, we will be more than happy to reflect on the matter further. In any event, we anticipate that those compiling redress schemes will expand their scope on a voluntary basis. Subsection (5) specifically allows for this. It makes it clear that these provisions do not prevent approved schemes from providing for the investigation and determination of complaints about other matters when members—that is, estate agents—have voluntarily accepted the jurisdiction of the scheme over such complaints.
Thus there is a real opportunity to expand the coverage of redress schemes beyond the requirements of this amendment. We will be exploring this further in the context of the consultations that the Government will be undertaking on this measure and the wider issues arising from the OFT report. But the final decision, of course, rests not with any technocrat, but with this House. I beg to move.
11.45 a.m.
Baroness Hanham: The Minister's explanation of the amendments is very welcome. As he said, this is an important part of the Bill, which is being inserted at quite a late stage and which it will be the responsibility of this House to see through.
I have a couple of worries. One is that the redress scheme seems to be, by any other name, a complaints system. Will the Minister confirm that that is the situation? If that is so, it is a very poor second guess at having estate agents registered and licensed. If it is a complaints system, the Minister is probably right in believing that there will be pressure to extend the scope more widely, rather than limiting it to the home information packs. It may be worth tabling an amendment and discussing the implications of making the scope wider, to cover the activities of estate agents.
The Minister might be kind enough to respond to another thought I had when he was introducing the amendment. It was not something we discussed when we talked about the home information packs. Is it a sine qua non that estate agents will always be the people who put the packs together? Off the top of my head, I cannot see why a solicitor should not do that. After a home inspector has been instructed to get the report done, is there any reason why a solicitor should not complete them? In that case, will the redress scheme be wide enough on that basis, too?
I am not being unwelcoming of the amendments, which are moving in the right direction, although they will probably need expanding at the next stage, when we can discuss them a little further. In the mean time, perhaps the Minister would consider whether this is not a rather limited response to the pressure that we applied over estate agents' registration, and whether the measure should be extended to anyone who is putting together the home information packs.
Baroness Maddock: We, too, welcome the Government's efforts. This issue is quite difficult
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because, as with other amendments, this is the first time that we have discussed them, and we have not had long to consider them. However, I am grateful for the Minister's explanation of why the scope is so limited, and why the provision deals with home information packs alone. That creates a difficulty for us, after the discussions that we have had so far. The nature of the Bill is such that trying to widen the scheme to the activities of estate agents not only associated with the home information packs is actually quite difficult. The Minister alluded to that in his last sentence.
I welcome the Minister's comment that we should not be ruled by technocrats, but I believe that there will be a problem. The National Association of Estate Agents has been advising me; it welcomes what the Government have done so far but along with others would like to see all aspects of the buying and selling process encompassed.
It will be difficult to get to grips with the issue because Parliament will not be sitting for the next three weeks and some of us have other commitments. I hope that it will not come up in the first week when we are back, so maybe we will be able to get to grips with it. I can see that we are going to have more arguments about how we get down anything that we can discuss to widen the scheme. The noble Baroness, Lady Hanham, is of the same view. The estate agents would like to see it wider, and I think I am correct that the DTI was hoping for a wider scheme. We will have to put our heads around it. That is the main disappointment; we are pleased about the rest.
Lord Borrie: Perhaps I may express a word of welcome for the new clause that the Minister has in mind. The scheme intended is both a complaint and a redress scheme. The existing ombudsman for estate agents scheme, which has been operative for 14 years and is the most obvious existing scheme—I do not think that there are any others—to be approved by the Government for the purposes of the new clause offers redress as a response to complaints about estate agents who are members of the scheme.
Unfortunately, the scheme does not have in its membership anywhere near as many estate agents as one would like. It does not quite cover 50 per cent of the total market. I declare a past interest: I was for some years a member of the council on the ombudsman for estate agents under the chairmanship of my noble friend Lady Mallalieu. I believe that the present chairman is the former Conservative Cabinet Minister the right honourable Gillian Shephard. She has continued the valuable work of the voluntary ombudsman scheme as it is as the moment.
It seems the most obvious scheme to receive government approval. No doubt the Government and the Benches opposite favour competition in the supply of goods and services, but I am not sure that it is such a good idea to have competition among those who offer redress facilities. It would probably be rather confusing, and there would be a risk of inconsistency in decisions and so on if two or more systems were operating.

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The Minister and the two speakers from the Opposition Front Benches have noted that the proposal is limited to complaints or redress in relation to home information packs. It may be a much better idea, if one can properly fit it into the Bill, if it were widened beyond that, because I am sure that the Committee will feel that if there were a redress scheme working well, worthy of government approval and so on, it would be far better that that scheme go across all complaints concerning estate agents—at any rate in the residential property market—and not just the narrow complaints against estate agents in respect of home information packs.
The new clause would be better if it did not have the limitation that it has. Let us hope that a way can be found in the next few weeks for devising such. At any rate, for reasons that I have already indicated, it would be sensible to have one code of practice for the ombudsman or whomever rather than a number of rival codes, otherwise there will be a certain amount of inconsistency.
Finally, perhaps I may draw the Committee's attention to a recently published White Paper from the Department for Constitutional Affairs entitled Transforming Public Services: Complaints, Redress and Tribunals—Command Paper 6243, published two months ago. There is a chapter of commendation of various existing public and private sector ombudsman schemes. Towards the end of the report, it says that one of the objectives of government in this field should be consistent and comprehensible decisions.
We will obtain consistent and comprehensible decisions only if we have one scheme approved that is worthy of approval in the matter that the Government want to cover, and preferably rather wider than the Government have in the present new clause, so that all activities of estate agents in relation to residential property are included.
Lord Rooker: I am grateful for the comments, and I shall do my best to answer the brief number of questions. Yes, it is a complaints system. There is already a regulatory system for estate agents that the Government are committed to improving, following the report of the Office of Fair Trading. It is more than a complaints system. The noble Baroness, Lady Hanham, is right that estate agents will not always put together the packs. Solicitors could do so; and the advantage is that they are already covered by a redress scheme. Of all the bodies involved, it happens that estate agents are not covered. They fall through the net completely. Solicitors are covered by the legal services ombudsman. I cannot spell it out any more clearly: the Government are looking for some help in getting the provision wider than we have presented it today. I invite the Committee to consider that over the next three weeks before Report.
On Question, amendment agreed to.
On Question, Whether Clause 146, as amended, shall stand part of the Bill?
Lord Hanningfield: This grouping is intended to probe the Minister over enforcement in relation to packs. Unsurprisingly, given our general apprehension about the packs and their current mandatory nature, we are concerned that failure to provide a pack would result in possible enforcement action. That appears to be an "all stick and no carrot" approach.
If, as the Minister has tried to assure us throughout our discussions, people will accept and indeed embrace the packs, why do the Government feel it necessary to include what can only be seen as a set of draconian measures? Surely if what he says is true, there would be no need for such legislation. If there are to be packs, they should be voluntary, which would obviously preclude the need for this section on enforcement.
The Minister could additionally clarify some of the detail, which appears vague, in the section. For instance, exactly how much would a penalty charge be? What would be the grounds for a person having,
"a reasonable excuse for not complying with the requirement"
to have a pack, as set out in Clause 147(5)? Who and what would be an enforcement officer? How exactly is the section to be enforced? How will the necessary authorities know if someone has a home information pack? Not only are we opposed to this section of the Bill as it stands, but it is sufficiently vague to give rise to considerable confusion both among home sellers and the individuals who are supposed to enforce such draconian measures. I would therefore welcome the Minister's thoughts.
Baroness Hamwee: On enforcement my question is not so much about sticks and carrots, although the Minister may think that the answer is about sticks and carrots. The question is, do the Government, as they appear to, think that there is a place for the state in enforcing the provisions rather than leaving it entirely to matters between citizens?
Noon
Lord Rooker: The answer to that last question is yes. I shall give an example. We are dealing here with a narrow point relating to Clause 146 to which I referred earlier. The matter would be enforced by the local weights and measures authorities. The vast majority of people abide by the law. However, there will always be some who want to cut corners if they see an opportunity to do so. As we have said, failure to comply with the home information pack duties would impact on all other transactions in a chain. We are dealing here not with the individual transaction of the buyer and seller of one property. As I said, the average chain comprises four properties. Therefore, other people are affected. That is why effective enforcement is essential.
Local authority trading standards officers will play the major role in this respect. They are ideally placed to carry out this function. They are already responsible for enforcing the Property Misdescriptions Act 1991 and parts of the Estate Agents Act 1979. The enforcement of the home information pack duties is

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complementary to those activities. I am not aware of people complaining about the duties they already take on and enforce.
Trading standards officers are the front line of consumer protection in a whole host of activities. People might ask what the state is doing in that regard. Trading standards officers are the front-line troops in terms of health and safety and food, for example. They have a fantastic range of expertise. I never see any reports that their duties are onerous or oppressive. They get on and do the job. Most trading standards officers will follow the law and add the duty that we are discussing to the activities they carry out under the two property-related Acts that they already enforce. Therefore, we do not envisage any major difficulty in that regard at all.
Lord Hanningfield: Will the Minister clarify the matter? I am the leader of an authority whose trading standards department will carry out this work. We mainly carry out spot checks. How does the Minister expect the measure to operate? As we have said several times, about 1.4 million homes change hands every year. That will involve 1.4 million home information packs. Does the Minister expect trading standards officers to double check that every home has one, or will there be spot checks? There may be an army of trading standards officers looking at 1.4 million packs. At the moment such laws are mainly enforced through spot checks rather than, for example, checking every pub to ensure that its staff are serving the correct measures, or checking every shop to ensure that its staff are selling the correct items.
Lord Rooker: I do not see the problem. I note that I am being asked that question by a good leader of a major, well run authority. He is asking Ministers to tell professional local government officers how to do their job. They will do the job in the same way they do it now. First, they will presumably operate on the basis of complaints from the public, because that is what trading standards officers do. Secondly, they will police the system on the basis of the risk that they countenance from the areas they are asked to police.
The noble Lord asks me whether trading standards officers will check every one of the 40,000 dwellings that go on sale every week. I should be astonished if the answer to that was yes as that would be an abject waste of their professional time. They will look at the risks, add their policing role to their existing roles and operate on the basis of complaints from the public, or complaints from other people. They will carry that out in the same professional way as Essex trading standards officers carry out their existing duties. So far as I can see, there will be no difference.
Lord Avebury: Relating to the production of the documents in a visible and legible documentary form, when the trading standards officer wants to verify that a particular document exists, why should it not be satisfactory for the person who holds that document simply to show it to him in electronic form? It is not necessary for the purpose of ascertaining that the
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document exists to print out the 200 pages or whatever it may consist of. One could simply show it to the enforcement officer as it exists on the hard disk of the particular estate agent.
Lord Rooker: The noble Lord is asking me almost to prescribe the way in which the job should be done. I do not know how trading standards officers will assess what documents are in the pack. That will be for them to assess. If they are prepared to accept information in an electronic format, that is up to them. That is the way of the world. I am confident that trading standards officers will do their job professionally. I shall not try to second-guess them.
I refer to the amount of penalty prescribed by the Secretary of State. The Bill as amended sets a maximum of £500. We have in mind setting the charge initially at about £200. The trading standards officers' primary enforcement role will be to inform and advise. A penalty will be issued only as a last resort. Trading standards officers are extremely helpful to the industries that they police.
Lord Hanningfield: I thank the Minister for that reply. We still do not agree with the whole provision as we consider that the packs should be voluntary. If they were voluntary, they would not need to be policed. However, I thank the Minister for his comments as they indicate that no one is expected to police every single pack. I am grateful for that useful comment.
Clause 146, as amended, agreed to.
Clause 147 [Power to require production of home information packs]:
On Question, Whether Clause 147 shall stand part of the Bill?
Lord Hanningfield: We on these Benches in no way condone those who systematically and cynically abuse the right-to-buy scheme. I believe that I have the wrong script.
Clause 147 agreed to.
Clause 148 [Penalty charge notices]:
Lord Rooker Lord Rooker moved Amendments Nos. 210ZB and 210ZC:
Page 101, line 8, leave out from "of" to "give" in line 9 and insert"—

(a) any duty under sections 137 to 141 and 147(4), or

(b) any duty imposed under section (Power to require estate agents to belong to a redress scheme)(1),"

Page 101, line 11, after "day" insert "(or in the case of a continuing breach the last day)"
On Question, amendments agreed to.
On Question, Whether Clause 148, as amended, shall stand part of the Bill?
Lord Hanningfield: I shall not speak to that Question.
The Deputy Chairman of Committees (Lord Lyell): I have it on my instructions that the noble Lord had given notice that he might wish to oppose the Question that the clause stand part. That is why I called it carefully. The Question is that Clause 148, as amended, shall stand part of the Bill. As many as are of that opinion shall say "Content".
Noble Lords: Content.
The Deputy Chairman of Committees: The "Contents" have it.
Clause 148, as amended, agreed to.
Lord Rooker Lord Rooker moved Amendment No. 210A:
Before Schedule 7, insert the following new schedule—

FURTHER PROVISIONS REGARDING EMPTY DWELLING MANAGEMENT ORDERS
  PART 1

    INTERIM EDMOS
    Operation of interim EDMOs
    1 (1) This paragraph deals with the time when an interim EDMO comes into force or ceases to have effect.
    (2) The order comes into force when it is made.
    (3) The order ceases to have effect at the end of the period of 12 months beginning with the date on which it is made, unless it ceases to have effect at some other time as mentioned below.
    (4) If the order provides that it is to cease to have effect on a date falling before the end of that period, it accordingly ceases to have effect on that date.
    (5) Sub-paragraphs (6) and (7) apply where—

    (a) a final EDMO ("the final EDMO") has been made under section (Making of final EDMOs) so as to replace the order ("the interim EDMO"), but

    (b) the final EDMO has not come into force because of an appeal to a residential property tribunal under paragraph 26 against the making of the final EDMO.

    (6) If the date on which the final EDMO comes into force in relation to the dwelling following the disposal of the appeal is later than the date on which the interim EDMO would cease to have effect apart from this sub-paragraph, the interim EDMO continues in force until that later date.
    (7) If, on the application of the authority, the tribunal makes an order providing for the interim EDMO to continue in force, pending the disposal of the appeal, until a date later than that on which the interim EDMO would cease to have effect apart from this sub-paragraph, the interim EDMO accordingly continues in force until that later date.
    (8) This paragraph has effect subject to paragraphs 6 and 7 (variation or revocation of orders by authority) and to the power of revocation exercisable by a residential property tribunal on an appeal made under paragraph 30.
    General effect of interim EDMOs
    2 (1) This paragraph applies while an interim EDMO is in force in relation to a dwelling.
    (2) The rights and powers conferred by sub-paragraph (3) are exercisable by the authority in performing their duties under section (Local housing authority's duties once interim EDMO in force)(1) to (3) in respect of the dwelling.
    (3) The authority—

    (a) have the right to possession of the dwelling (subject to the rights of existing occupiers preserved by paragraph 18(3));

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    (b) have the right to do (and authorise a manager or other person to do) in relation to the dwelling anything which the relevant proprietor of the dwelling would (but for the order) be entitled to do;

    (c) may create one or more of the following—

    (i) an interest in the dwelling which, as far as possible, has all the incidents of a leasehold, or

    (ii) a right in the nature of a licence to occupy part of the dwelling;

    (d) may apply to a residential property tribunal for an order under paragraph 22 determining a lease or licence of the dwelling.

    (4) But the authority may not under sub-paragraph (3)(c) create any interest or right in the nature of a lease or licence unless—

    (a) consent in writing has been given by the relevant proprietor of the dwelling, and

    (b) where the relevant proprietor is a lessee under a lease of the dwelling, the interest or right is created for a term that is less than the term of that lease.

    (5) The authority—

    (a) do not under this paragraph acquire any estate or interest in the dwelling, and

    (b) accordingly are not entitled by virtue of this paragraph to sell, lease, charge or make any other disposition of any such estate or interest.

    (6) But, where the relevant proprietor of the dwelling is a lessee under a lease of the dwelling, the authority are to be treated (subject to sub-paragraph (5)(a)) as if they were the lessee instead.
    (7) Any enactment or rule of law relating to landlords and tenants or leases applies in relation to—

    (a) a lease in relation to which the authority are to be treated as the lessee under sub-paragraph (6), or

    (b) a lease to which the authority become a party under paragraph 4(2),

    as if the authority were the legal owner of the premises (but this is subject to paragraph 4(4) to (6)).
    (8) None of the following, namely—

    (a) the authority, or

    (b) any person authorised under sub-paragraph (3)(b),

    is liable to any person having an estate or interest in the dwelling for anything done or omitted to be done in the performance (or intended performance) of the authority's duties under section (Local housing authority's duties once interim EDMO in force)(1) to (3) unless the act or omission is due to negligence of the authority or any such person.
    (9) An interim EDMO which has come into force is a local land charge.
    (10) The authority may apply to the Chief Land Registrar for the entry of an appropriate restriction in the register of title in respect of such an order.
    (11) In this paragraph "enactment" includes an enactment comprised in subordinate legislation (within the meaning of the Interpretation Act 1978 (c. 30)).
    General effect of interim EDMOs: leases and licences granted by authority
    3 (1) This paragraph applies in relation to any interest or right created by the authority under paragraph 2(3)(c).
    (2) For the purposes of any enactment or rule of law—

    (a) any interest created by the authority under paragraph 2(3)(c)(i) is to be treated as if it were a legal lease, and

    (b) any right created by the authority under paragraph 2(3)(c)(ii) is to be treated as if it were a licence to occupy granted by the legal owner of the dwelling,

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    despite the fact that the authority have no legal estate in the dwelling (see paragraph 2(5)(a)).
    (3) Any enactment or rule of law relating to landlords and tenants or leases accordingly applies in relation to any interest created by the authority under paragraph 2(3)(c)(i) as if the authority were the legal owner of the dwelling.
    (4) References to leases and licences—

    (a) in this Chapter, and

    (b) in any other enactment,

    accordingly include (where the context permits) interests and rights created by the authority under paragraph 2(3)(c).
    (5) The preceding provisions of this paragraph have effect subject to—

    (a) paragraph 4(4) to (6), and

    (b) any provision to the contrary contained in an order made by the appropriate national authority.

    (6) In paragraph 2(5)(b) the reference to leasing does not include the creation of interests under paragraph 2(3)(c)(i).
    (7) In this paragraph—
    "enactment" has the meaning given by paragraph 2(11);
    "legal lease" means a term of years absolute (within section 1(1)(b) of the Law of Property Act 1925 (c. 20)).
    General effect of interim EDMOs: relevant proprietor, mortgagees etc.
    4 (1) This paragraph applies in relation to—

    (a) the relevant proprietor, and

    (b) other persons with an estate or interest in the dwelling,

    while an interim EDMO is in force in relation to a dwelling.
    (2) Where the relevant proprietor is a lessor or licensor under a lease or licence of the dwelling, the lease or licence has effect while the order is in force as if the local housing authority were substituted in it for the lessor or licensor.
    (3) Such a lease continues to have effect, as far as possible, as a lease despite the fact that the rights of the local housing authority, as substituted for the lessor, do not amount to an estate in law in the dwelling.
    (4) The provisions mentioned in sub-paragraph (5) do not apply to a lease or licence within sub-paragraph (2).
    (5) The provisions are—

    (a) the provisions which exclude local authority lettings from the Rent Acts, namely—

    (i) sections 14 to 16 of the Rent Act 1977 (c. 42), and

    (ii) those sections as applied by Schedule 2 to the Rent (Agriculture) Act 1976 (c. 80) and section 5(2) to (4) of that Act; and

    (b) section 1(2) of, and paragraph 12 of Part 1 of Schedule 1 to, the Housing Act 1988 (c. 50) (which exclude local authority lettings from Part 1 of that Act).

    (6) Nothing in this Chapter has the result that the authority are to be treated as the legal owner of any premises for the purposes of—

    (a) section 80 of the Housing Act 1985 (c. 68) (the landlord condition for secure tenancies); or

    (b) section 124 of the Housing Act 1996 (c. 52) (introductory tenancies).

    (7) The relevant proprietor of the dwelling—

    (a) is not entitled to receive any rents or other payments made in respect of occupation of the dwelling;

    (b) may not exercise any rights or powers with respect to the management of the dwelling; and

    (c) may not create any of the following—

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    (i)any leasehold interest in the dwelling or a part of it (other than a lease of a reversion), or

    (ii) any licence or other right to occupy it.

    (8) However (subject to sub-paragraph (7)(c)) nothing in paragraph 2 or this paragraph affects the ability of a person having an estate or interest in the dwelling to make any disposition of that estate or interest.
    (9) Nothing in paragraph 2 or this paragraph affects—

    (a) the validity of any mortgage relating to the dwelling or any rights or remedies available to the mortgagee under such a mortgage, or

    (b) the validity of any lease of the dwelling under which the relevant proprietor is a lessee, or any superior lease, or (subject to paragraph 2(6)) any rights or remedies available to the lessor under such a lease,

    except to the extent that any of those rights or remedies would prevent the local housing authority from exercising their power under paragraph 2(3)(c).
    (10) In proceedings for the enforcement of any such rights or remedies the court may make such order as it thinks fit as regards the operation of the interim EDMO (including an order quashing it).
    Financial arrangements while order is in force
    5 (1) This paragraph applies to relevant expenditure of a local housing authority who have made an interim EDMO.
    (2) "Relevant expenditure" means—

    (a) expenditure incurred by the authority with the consent of the relevant proprietor, or

    (b) any other expenditure reasonably incurred by the authority,

    in connection with performing their duties under section (Local housing authority's duties once interim EDMO in force)(1) to (3) in respect of the dwelling (including any premiums paid for insurance of the premises).
    (3) Rent or other payments which the authority have collected or recovered, by virtue of this Chapter, from persons occupying or having the right to occupy the dwelling may be used by the authority to meet—

    (a) relevant expenditure, and

    (b) any amounts of compensation payable to a third parry by virtue of an order under section (Authorisation to make interim EDMOs)(4) or (Compensation payable to third parties)(2) or to a dispossessed landlord or tenant by virtue of an order under paragraph 22(5).

    (4) The authority must pay to the relevant proprietor—

    (a) any amount of rent or other payments collected or recovered as mentioned in sub-paragraph (3) that remains after deductions to meet relevant expenditure and any amounts of compensation payable as mentioned in that sub-paragraph, and

    (b) (where appropriate) interest on that amount at a reasonable rate fixed by the authority,

    and such payments are to be made at such intervals as the authority consider appropriate.
    (5) The interim EDMO may provide for—

    (a) the rate of interest which is to apply for the purposes of paragraph (b) of sub-paragraph (4); and

    (b) the intervals at which payments are to be made under that sub-paragraph.

    Paragraph 26(1)(c) enables an appeal to be brought where the order does not provide for both of those matters.
    (6) The authority must—

    (a) keep full accounts of their income and expenditure in respect of the dwelling; and

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    (b) afford to the relevant proprietor, and to any other person who has an estate or interest in the dwelling, all reasonable facilities for inspecting, taking copies of and verifying those accounts.

    (7) The relevant proprietor may apply to a residential property tribunal for an order—

    (a) declaring that an amount shown in the accounts as expenditure of the authority does not constitute relevant expenditure (see sub-paragraph (2));

    (b) requiring the authority to make such financial adjustments (in the accounts and otherwise) as are necessary to reflect the tribunal's declaration.

    (8) In this paragraph—
    "dispossessed landlord or tenant" means a person who was a lessor, lessee, licensor or licensee under a lease or licence determined by an order under paragraph 22;
    "expenditure" includes administrative costs.
    Variation or revocation of interim EDMOs
    6 (1) The local housing authority may vary an interim EDMO if they consider it appropriate to do so.
    (2) A variation does not come into force until such time, if any, as is the operative time for the purposes of this sub-paragraph under paragraph 33 (time when period for appealing expires without an appeal being made or when decision to vary is confirmed on appeal).
    (3) The power to vary an order under this paragraph is exercisable by the authority either—

    (a) on an application made by a relevant person, or

    (b) on the authority's own initiative.

    (4) In this paragraph "relevant person" means any person who has an estate or interest in the dwelling (other than a person who is a tenant under a lease or licence granted under paragraph 2(3)(c)).
    7 (1) The local housing authority may revoke an interim EDMO in the following cases—

    (a) where the authority conclude that there are no steps which they could appropriately take for the purpose of securing that the dwelling is occupied (see section (Local housing authority's duties once interim EDMO in force)(4));

    (b) where the authority are satisfied that—

    (i) the dwelling will either become or continue to be occupied, despite the order being revoked, or

    (ii) that the dwelling is to be sold;

    (c) where a final EDMO has been made by the authority in respect of the dwelling so as to replace the order;

    (d) where the authority conclude that it would be appropriate to revoke the order in order to prevent or stop interference with the rights of a third party in consequence of the order; and

    (e) where in any other circumstances the authority consider it appropriate to revoke the order.

    (2) But, in a case where the dwelling is occupied, the local housing authority may not revoke an interim EDMO under subparagraph (1)(b), (d) or (e) unless the relevant proprietor consents.
    (3) A revocation does not come into force until such time, if any, as is the operative time for the purposes of this sub-paragraph under paragraph 33 (time when period for appealing expires without an appeal being made or when decision to revoke is confirmed on appeal).
    (4) The power to revoke an order under this paragraph is exercisable by the authority either—

    (a) on an application made by a relevant person, or

    (b) on the authority's own initiative.

    (5) Where a relevant person applies to the authority for the revocation of an order under this paragraph, the authority may refuse to revoke the order unless the relevant proprietor (or some other person) agrees to pay to the authority any deficit such as is mentioned in paragraph 23(4).
    (6) In this paragraph "relevant person" means any person who has an estate or interest in the dwelling (other than a person who is a tenant under a lease or licence granted under paragraph 2(3)(c)).
    8 (1) Part 2 of Schedule 6 applies in relation to the variation or revocation of an interim EDMO as it applies in relation to the variation or revocation of an interim management order.
    (2) But paragraph 23 of that Schedule so applies as if subparagraph (4) defined "relevant person" as any person who, to the knowledge of the local housing authority, is a person having an estate or interest in the dwelling (other than a person who is a tenant under a lease or licence granted under paragraph 2(3)(c) of this Schedule).

  PART 2

    FINAL EDMOS
    Operation of final EDMOs
    9 (1) This paragraph deals with the time when a final EDMO comes into force or ceases to have effect.
    (2) The order does not come into force until such time (if any) as is the operative time for the purposes of this sub-paragraph under paragraph 29 (time when period for appealing expires without an appeal being made or when order is confirmed on appeal).
    (3) The order ceases to have effect at the end of the period of 7 years beginning with the date on which it comes into force, unless it ceases to have effect at some other time as mentioned below.
    (4) If the order provides that it is to cease to have effect on a date falling before the end of that period, it accordingly ceases to have effect on that date.
    (5) If—

    (a) the order provides that it is to cease to have effect on a date falling after the end of that period, and

    (b) the relevant proprietor of the dwelling has consented to that provision,

    the order accordingly ceases to have effect on that date.
    (6) Sub-paragraphs (7) and (8) apply where—

    (a) a new final EDMO ("the new order") has been made so as to replace the order ("the existing order"), but

    (b) the new order has not come into force because of an appeal to a residential property tribunal under paragraph 26 against the making of that order.

    (7) If the date on which the new order comes into force in relation to the dwelling following the disposal of the appeal is later than the date on which the existing order would cease to have effect apart from this sub-paragraph, the existing order continues in force until that later date.
    (8) If, on the application of the authority, the tribunal makes an order providing for the existing order to continue in force, pending the disposal of the appeal, until a date later than that on which it would cease to have effect apart from this sub-paragraph, the existing order accordingly continues in force until that later date.
    (9) This paragraph has effect subject to paragraphs 15 and 16 (variation or revocation of orders) and to the power of revocation exercisable by a residential property tribunal on an appeal made under paragraph 26 or 30.
    General effect of final EDMOs
    10 (1) This paragraph applies while a final EDMO is in force in relation to a dwelling.
    (2) The rights and powers conferred by sub-paragraph (3) are exercisable by the authority in performing their duties under section (Local housing authority's duties once final EDMO in force)(1) to (3) in respect of the dwelling.
    (3) The authority—

    (a) have the right to possession of the dwelling (subject to the rights of existing and other occupiers preserved by paragraph 18(3) and (4));

    (b) have the right to do (and authorise a manager or other person to do) in relation to the dwelling anything which the relevant proprietor of the dwelling would (but for the order) be entitled to do;

    (c) may create one or more of the following—

    (i) an interest in the dwelling which, as far as possible, has all the incidents of a leasehold, or

    (ii) a right in the nature of a licence to occupy part of the dwelling;

    (d) may apply to a residential property tribunal for an order under paragraph 22 determining a lease or licence of the dwelling.

    (4) The powers of the authority under sub-paragraph (3)(c) are restricted as follows—

    (a) they may not create any interest or right in the nature of a lease or licence—

    (i) which is for a fixed term expiring after the date on which the order is due to expire, or

    (ii) (subject to paragraph (b)) which is terminable by notice to quit, or an equivalent notice, of more than 4 weeks,

    unless consent in writing has been given by the relevant proprietor;

    (b) they may create an interest in the nature of an assured shorthold tenancy without any such consent so long as it is created before the beginning of the period of 6 months that ends with the date on which the order is due to expire.

    (5) The authority—

    (a) do not under this paragraph acquire any estate or interest in the dwelling, and

    (b) accordingly are not entitled by virtue of this paragraph to sell, lease, charge or make any other disposition of any such estate or interest.

    (6) But, where the relevant proprietor of the dwelling is a lessee under a lease of the dwelling, the authority are to be treated (subject to sub-paragraph (5)(a)) as if they were the lessee instead.
    (7) Any enactment or rule of law relating to landlords and tenants or leases applies in relation to—

    (a) a lease in relation to which the authority are to be treated as the lessee under sub-paragraph (6), or

    (b) a lease to which the authority become a party under paragraph 12(2),

    as if the authority were the legal owner of the premises (but this is subject to paragraph 12(4) to (6)).
    (8) None of the following, namely—

    (a) the authority, or

    (b) any person authorised under sub-paragraph (3)(b),

    is liable to any person having an estate or interest in the dwelling for anything done or omitted to be done in the performance (or intended performance) of the authority's duties under section (Local housing authority's duties once final EDMO in force)(1) to (3) unless the act or omission is due to negligence of the authority or any such person.
    (9) A final EDMO which has come into force is a local land charge.
    (10) The authority may apply to the Chief Land Registrar for the entry of an appropriate restriction in the register in respect of such an order.
    (11) In this paragraph "enactment" includes an enactment comprised in subordinate legislation (within the meaning of the Interpretation Act 1978 (c. 30)).
    General effect of final EDMOs: leases and licences granted by authority
    11 (1) This paragraph applies in relation to any interest or right created by the authority under paragraph 10(3)(c).
    (2) For the purposes of any enactment or rule of law—

    (a) any interest created by the authority under paragraph 10(3)(c)(i) is to be treated as if it were a legal lease, and

    (b) any right created by the authority under paragraph 10(3)(c)(ii) is to be treated as if it were a licence to occupy granted by the legal owner of the dwelling,

    despite the fact that the authority have no legal estate in the dwelling (see paragraph 10(5)(a)).
    (3) Any enactment or rule of law relating to landlords and tenants or leases accordingly applies in relation to any interest created by the authority under paragraph 10(3)(c)(i) as if the authority were the legal owner of the dwelling.
    (4) References to leases and licences—

    (a) in this Chapter, and

    (b) in any other enactment,

    accordingly include (where the context permits) interests and rights created by the authority under paragraph 10(3)(c).
    (5) The preceding provisions of this paragraph have effect subject to—

    (a) paragraph 12(4) to (6), and

    (b) any provision to the contrary contained in an order made by the appropriate national authority.

    (6) In paragraph 10(5)(b) the reference to leasing does not include the creation of interests under paragraph 10(3)(c)(i).
    (7) In this paragraph—
    "enactment" has the meaning given by paragraph 10(11);
    "legal lease" means a term of years absolute (within section 1(1)(b) of the Law of Property Act 1925 (c. 20)).
    General effect of final EDMOs: relevant proprietor, mortgagees etc.
    12 (1) This paragraph applies in relation to—

    (a) the relevant proprietor, and

    (b) other persons with an estate or interest in the dwelling,

    while a final EDMO is in force in relation to a dwelling.
    (2) Where the relevant proprietor is a lessor or licensor under a lease or licence of the dwelling, the lease or licence has effect while the order is in force as if the local housing authority were substituted in it for the lessor or licensor.
    (3) Such a lease continues to have effect, as far as possible, as a lease despite the fact that the rights of the local housing authority, as substituted for the lessor, do not amount to an estate in law in the dwelling.
    (4) The provisions mentioned in sub-paragraph (5) do not apply to a lease or licence within sub-paragraph (2).
    (5) The provisions are—

    (a) the provisions which exclude local authority lettings from the Rent Acts, namely—

    (i) sections 14 to 16 of the Rent Act 1977 (c. 42), and

    (ii) those sections as applied by Schedule 2 to the Rent (Agriculture) Act 1976 (c. 80) and section 5(2) to (4) of that Act; and

    (b) section 1(2) of, and paragraph 12 of Part 1 of Schedule 1 to, the Housing Act 1988 (c. 50) (which exclude local authority lettings from Part 1 of that Act).

    (6) Nothing in this Chapter has the result that the authority are to be treated as the legal owner of any premises for the purposes of—

    (a) section 80 of the Housing Act 1985 (c. 68) (the landlord condition for secure tenancies); or

    (b) section 124 of the Housing Act 1996 (c. 52) (introductory tenancies).

    (7) The relevant proprietor of the dwelling—

    (a) is not entitled to receive any rents or other payments made in respect of occupation of the dwelling;

    (b) may not exercise any rights or powers with respect to the management of the dwelling; and

    (c) may not create any of the following—

    (i) any leasehold interest in the dwelling or a part of it (other than a lease of a reversion), or

    (ii) any licence or other right to occupy it.

    (8) However (subject to sub-paragraph (7)(c)) nothing in paragraph 10 or this paragraph affects the ability of a person having an estate or interest in the dwelling to make any disposition of that estate or interest.
    (9) Nothing in paragraph 10 or this paragraph affects—

    (a) the validity of any mortgage relating to the dwelling or any rights or remedies available to the mortgagee under such a mortgage, or

    (b) the validity of any lease of the dwelling under which the relevant proprietor is a lessee, or any superior lease, or (subject to paragraph 10(6)) any rights or remedies available to the lessor under such a lease;

    except to the extent that any of those rights or remedies would prevent the local housing authority from exercising their power under paragraph 10(3)(c).
    (10) In proceedings for the enforcement of any such rights or remedies the court may make such order as it thinks fit as regards the operation of the final EDMO (including an order quashing it).
    Management scheme and accounts
    13 (1) A final EDMO must contain a management scheme.
    (2) A "management scheme" is a scheme setting out how the local housing authority are to carry out their duties under section (Local housing authority's duties once final EDMO in force)(1) to (3) as respects the dwelling.
    (3) The scheme is to contain a plan giving details of the way in which the authority propose to manage the dwelling, which must (in particular) include—

    (a) details of any works that the authority intend to carry out in connection with the dwelling;

    (b) an estimate of the capital and other expenditure to be incurred by the authority in respect of the dwelling while the order is in force;

    (c) the amount of rent which, in the opinion of the authority, the dwelling might reasonably be expected to fetch on the open market at the time the management scheme is made;

    (d) the amount of rent or other payments that the authority will seek to obtain;

    (e) the amount of any compensation that is payable to a third party by virtue of a decision of the authority under section (Making of final EDMOs)(4) or (Compensation payable to third parties)(3) in respect of any interference in consequence of the final EDMO with the rights of that person;

    (f) provision as to the payment of any such compensation and of any compensation payable to a dispossessed landlord or tenant by virtue of an order under paragraph 22(5);

    1312

    (g) where the amount of rent payable to the authority in respect of the dwelling for a period is less than the amount of rent mentioned in paragraph (c) in respect of a period of the same length, provision as to the following—

    (i) the deduction from the difference of relevant expenditure and any amounts of compensation payable to a third party or dispossessed landlord or tenant;

    (ii) the payment of any remaining amount to the relevant proprietor;

    (iii) the deduction from time to time of any remaining amount from any amount that the authority are entitled to recover from the proprietor under paragraph 23(5) or (6);

    (h) provision as to the payment by the authority to the relevant proprietor from time to time of amounts of rent or other payments that remain after the deduction of—

    (i) relevant expenditure, and

    (ii) any amount of compensation payable to a third party or dispossessed landlord or tenant;

    (i) provision as to the manner in which the authority are to pay to the relevant proprietor, on the termination of the final EDMO, the balance of any amounts of rent or other payments that remain after the deduction of relevant expenditure and any amounts of compensation payable to a third party or dispossessed landlord or tenant;

    (j) provision as to the manner in which the authority are to pay, on the termination of the final EDMO, any outstanding amount of compensation payable to a third party or dispossessed landlord or tenant.

    (4) The scheme may also state—

    (a) the authority's intentions as regards the use of rent or other payments to meet relevant expenditure;

    (b) the authority's intentions as regards the payment to the relevant proprietor (where appropriate) of interest on amounts within sub-paragraph (3)(h) and (i);

    (c) that paragraph 23(2) or, where the relevant proprietor consents, paragraph 23(3)(c) is not to apply in relation to an interim EDMO or (as the case may be) final EDMO that immediately preceded the final EDMO, and that instead the authority intend to use any balance such as is mentioned in that sub-paragraph to meet—

    (i) relevant expenditure incurred during the currency of that final EDMO, and

    (ii) any compensation that may become payable to a third party or a dispossessed landlord or tenant;

    (d) that paragraph 23(4) to (6) are not to apply in relation to an interim EDMO or, where the relevant proprietor consents, a final EDMO that immediately preceded the final EDMO, and that instead the authority intend to use rent or other payments collected during the currency of that final EDMO to reimburse the authority in respect of any deficit such as is mentioned in paragraph 23(4);

    (e) the authority's intentions as regards the recovery from the relevant proprietor, with or without interest, of any amount of relevant expenditure incurred under a previous interim EDMO or final EDMO that the authority are entitled to recover from the proprietor under paragraph 23(5) or (6).

    (5) The authority must—

    (a) keep full accounts of their income and expenditure in respect of the dwelling; and

    (b) afford to the relevant proprietor, and to any other person who has an estate or interest in the dwelling, all reasonable facilities for inspecting, taking copies of and verifying those accounts.

    (6) In this paragraph—
    "dispossessed landlord or tenant" means a person who was a lessor, lessee, licensor or licensee under a lease or licence determined by an order under paragraph 22;
    "relevant expenditure" means—

    (a) expenditure incurred by the authority with the consent of the relevant proprietor, or

    (b) any other expenditure reasonably incurred by the authority, in connection with performing their duties under section (Local housing authority's duties once interim EDMO in force)(1) to (3) or (Local housing authority's duties once final EDMO in force)(1) to (3) in respect of the dwelling (including any reasonable administrative costs and any premiums paid for insurance of the premises);

    "rent or other payments" means rent or other payments collected or recovered, by virtue of this Chapter, from persons occupying or having the right to occupy the dwelling.
    (7) In any provision of this Chapter relating to varying, revoking or appealing against decisions relating to a final EDMO, any reference to such an order includes (where the context permits) a reference to the management scheme contained in it.
    Application to residential property tribunal in respect of breach of management scheme
    14 (1) An affected person may apply to a residential property tribunal for an order requiring the local housing authority to manage a dwelling in accordance with the management scheme contained in a final EDMO made in respect of the dwelling.
    (2) On such an application the tribunal may, if it considers it appropriate to do so, make an order—

    (a) requiring the authority to manage the dwelling in accordance with the management scheme, or

    (b) revoking the final EDMO as from a date specified in the tribunal's order.

    (3) An order under sub-paragraph (2) may—

    (a) set out the steps which the authority are to take to manage the dwelling in accordance with the management scheme,

    (b) include provision varying the final EDMO, and

    (c) require the payment of money to an affected person by way of damages.

    (4) In this paragraph "affected person" means—

    (a) the relevant proprietor, and

    (b) any third party to whom compensation is payable by virtue of an order under section (Authorisation to make interim EDMOs)(4) or (Compensation payable to third parties)(2) or a decision of the authority under section (Making of final EDMOs)(4) or (Compensation payable to third parties)(3) or who was a lessor, lessee, licensor or licensee under a lease or licence determined by an order of the residential property tribunal under paragraph 22 and to whom compensation is payable by virtue of an order under sub-paragraph (5) of that paragraph.

    Variation or revocation of final EDMOs
    15 (1) The local housing authority may vary a final EDMO if they consider it appropriate to do so.
    (2) A variation does not come into force until such time, if any, as is the operative time for the purposes of this sub-paragraph under paragraph 33 (time when period for appealing expires without an appeal being made or when decision to vary is confirmed on appeal).
    (3) The power to vary an order under this paragraph is exercisable by the authority either—

    (a) on an application made by a relevant person, or

    (b) on the authority's own initiative.

    (4) In this paragraph "relevant person" means any person who has an estate or interest in the dwelling (other than a person who is a tenant under a lease or licence granted under paragraph 2(3)(c) or 10(3)(c)).
    16 (1) The local housing authority may revoke a final EDMO in the following cases—

    (a) where the authority conclude that there are no steps which they could appropriately take as mentioned in section (Local housing authority's duties once final EDMO in force)(4)(b) or that keeping the order in force is not necessary as mentioned in section (Local housing authority's duties once final EDMO in force)(4)(e);

    (b) where the authority are satisfied that—

    (i) the dwelling will either become or continue to be occupied, despite the order being revoked, or

    (ii) that the dwelling is to be sold;

    (c) where a further final EDMO has been made by the authority in respect of the dwelling so as to replace the order;

    (d) where the authority conclude that it would be appropriate to revoke the order in order to prevent or stop interference with the rights of a third party in consequence of the order; and

    (e) where in any other circumstances the authority consider it appropriate to revoke the order.

    (2) But, in a case where the dwelling is occupied, the local housing authority may not revoke a final EDMO under subparagraph (1)(b), (d) or (e) unless the relevant proprietor consents.
    (3) A revocation does not come into force until such time, if any, as is the operative time for the purposes of this sub-paragraph under paragraph 33 (time when period for appealing expires without an appeal being made or when decision to revoke is confirmed on appeal).
    (4) The power to revoke an order under this paragraph is exercisable by the authority either—

    (a) on an application made by a relevant person, or

    (b) on the authority's own initiative.

    (5) Where a relevant person applies to the authority for the revocation of an order under this paragraph, the authority may refuse to revoke the order unless the relevant proprietor (or some other person) agrees to pay to the authority any deficit such as is mentioned in paragraph 23(4).
    (6) In this paragraph "relevant person" means any person who has an estate or interest in the dwelling (other than a person who is a tenant under a lease or licence granted under paragraph 2(3)(c) or 10(3)(c)).
    17 (1) Part 2 of Schedule 6 applies in relation to the variation or revocation of a final EDMO as it applies in relation to the variation or revocation of a final management order.
    (2) But paragraph 23 of that Schedule so applies as if subparagraph (4) defined "relevant person" as any person who, to the knowledge of the local housing authority, is a person having an estate or interest in the dwelling (other than a person who is a tenant under a lease or licence granted under paragraph 2(3)(c) or 10(3)(c) of this Schedule).

  PART 3

    INTERIM AND FINAL EDMOS: GENERAL PROVISIONS (OTHER THAN PROVISIONS RELATING TO APPEALS)
    Effect of EDMOs: persons occupying or having a right to occupy the dwelling
    18 (1) This paragraph applies to existing and new occupiers of a dwelling in relation to which an interim EDMO or final EDMO is in force.
    (2) In this paragraph—
    "existing occupier" means a person other than the relevant proprietor who, at the time when the order comes into force—

    (a) has the right to occupy the dwelling, but

    (b) is not a new occupier within sub-paragraph (4);

    "new occupier" means a person who, at a time when the order is in force, is occupying the dwelling under a lease or licence granted under paragraph 2(3)(c) or 10(3)(c).
    (3) Paragraphs 2 and 10 do not affect the rights or liabilities of an existing occupier under a lease or licence (whether in writing or not) under which he has the right to occupy the dwelling at the commencement date.
    (4) Paragraph 10 does not affect the rights and liabilities of a new occupier who, in the case of a final EDMO, is occupying the dwelling at the time when the order comes into force.
    (5) The provisions mentioned in sub-paragraph (6) do not apply to a lease or agreement under which a new occupier has the right to occupy or is occupying the dwelling.
    (6) The provisions are—

    (a) the provisions which exclude local authority lettings from the Rent Acts, namely—

    (i) sections 14 to 16 of the Rent Act 1977
    (c. 42), and

    (ii) those sections as applied by Schedule 2 to the Rent (Agriculture) Act 1976 (c. 80) and section 5(2) to (4) of that Act; and

    (b) section 1(2) of, and paragraph 12 of Part 1 of Schedule 1 to, the Housing Act 1988 (c. 50) (which exclude local authority lettings from Part 1 of that Act).

    (7) If, immediately before the coming into force of an interim EDMO or final EDMO, an existing occupier had the right to occupy the dwelling under—

    (a) a protected or statutory tenancy within the meaning of the Rent Act 1977,

    (b) a protected or statutory tenancy within the meaning of the Rent (Agriculture) Act 1976, or

    (c) an assured tenancy or assured agricultural occupancy within the meaning of Part 1 of the Housing Act 1988 (c. 50),

    nothing in this Chapter (except an order under paragraph 22 determining a lease or licence) prevents the continuance of that tenancy or occupancy or affects the continued operation of any of those Acts in relation to the tenancy or occupancy after the coming into force of the order.
    (8) In this paragraph "the commencement date" means the date on which the order came into force (or, if that order was preceded by one or more orders under this Chapter, the date when the first order came into force).
    Effect of EDMOs: agreements and legal proceedings
    19 (1) An agreement or instrument within sub-paragraph (2) has effect, while an interim EDMO or final EDMO is in force, as if any rights or liabilities of the relevant proprietor under the agreement or instrument were instead rights or liabilities of the local housing authority.
    (2) An agreement or instrument is within this sub-paragraph if—

    (a) it is effective on the commencement date,

    (b) one of the parties to it is the relevant proprietor of the dwelling,

    (c) it relates to the dwelling, whether in connection with any management activities with respect to it, or otherwise,

    (d) it is specified for the purposes of this sub-paragraph in the order or falls within a description of agreements or instruments so specified, and

    (e) the authority serve a notice in writing on all the parties to it stating that sub-paragraph (1) is to apply to it.

    (3) An agreement or instrument is not within sub-paragraph (2) if—

    (a) it is a lease or licence within paragraph 2(6) or 10(6), or

    (b) it relates to any disposition by the relevant proprietor which is not precluded by paragraph 4(7) or 12(7).

    (4) Proceedings in respect of any cause of action within subparagraph (5) may, while an interim EDMO or final EDMO is in force, be instituted or continued by or against the local housing authority instead of by or against the relevant proprietor.
    (5) A cause of action is within this sub-paragraph if—

    (a) it is a cause of action (of any nature) which accrued to or against the relevant proprietor of the dwelling before the commencement date,

    (b) it relates to the dwelling as mentioned in sub-paragraph (2)(c),

    (c) it is specified for the purposes of this sub-paragraph in the order or falls within a description of causes of action so specified, and

    (d) the authority serve a notice in writing on all interested parties stating that sub-paragraph (4) is to apply to it.

    (6) If, by virtue of this paragraph, the authority become subject to any liability to pay damages in respect of anything done (or omitted to be done) before the commencement date by or on behalf of the relevant proprietor of the dwelling, the relevant proprietor is liable to reimburse to the authority an amount equal to the amount of damages paid by them.
    (7) In this paragraph—
    "agreement" includes arrangement;
    "the commencement date" means the date on which the order comes into force (or, if that order was preceded by one or more orders under this Chapter, the date when the first order came into force);
    "management activities" includes repair, maintenance, improvement and insurance.
    Effect of EDMOs: furniture
    20 (1) Sub-paragraph (2) applies where, on the date on which an interim EDMO or final EDMO comes into force, there is furniture owned by the relevant proprietor in the dwelling.
    (2) Subject to sub-paragraphs (3) and (4), the right to possession of the furniture against all persons vests in the local housing authority on that date and remains vested in the authority while the order is in force.
    (3) The right of the local housing authority under subparagraph (2) to possession of the furniture is subject to the rights of any person who, on the date on which the interim EDMO or final EDMO comes into force, has the right to possession of the dwelling.
    (4) Where—

    (a) the local housing authority have the right to possession of the furniture under sub-paragraph (2), and

    (b) they have not granted a right to possession of the furniture to any other person,

    they must, on a request by the relevant proprietor, give up possession of the furniture to him.
    (5) The local housing authority may renounce the right to possession of the furniture conferred by sub-paragraph (2) by serving notice on the relevant proprietor not less than two weeks before the renunciation is to have effect.
    (6) Where the local housing authority renounce the right to possession of the furniture under sub-paragraph (5), they must make appropriate arrangements for storage of the furniture at their own cost.
    (7) In this paragraph "furniture" includes fittings and other articles.
    EDMOs: power to supply furniture
    21 (1) The local housing authority may supply the dwelling to which an interim EDMO or final EDMO relates with such furniture as they consider to be required.
    (2) For the purposes of paragraph 5 or paragraph 13, any expenditure incurred by the authority under this paragraph constitutes expenditure incurred by the authority in connection with performing their duties under section (Local housing authority's duties once interim EDMO in force)(1) to (3) or (Local housing authority's duties once final EDMO in force)(1) to (3).
    (3) In this paragraph "furniture" includes fittings and other articles.
    Power of a residential property tribunal to determine certain leases and licences
    22 (1) A residential property tribunal may make an order determining a lease or licence to which this paragraph applies if—

    (a) the case falls within sub-paragraph (3) or (4), and

    (b) the tribunal are satisfied that the dwelling is not being occupied and that the local housing authority need to have the right to possession of the dwelling in order to secure that the dwelling becomes occupied.

    (2) This paragraph applies to the following leases and licences of a dwelling—

    (a) a lease of the dwelling in respect of which the relevant proprietor is the lessor,

    (b) a sub-lease of any such lease, and

    (c) a licence of the dwelling.

    (3) A case falls within this sub-paragraph if—

    (a) an interim or final EDMO is in force in respect of the dwelling, and

    (b) the local housing authority have applied under paragraph 2(3)(d) or 10(3)(d) for an order determining the lease or licence.

    (4) A case falls within this sub-paragraph if—

    (a) the local housing authority have applied to the residential property tribunal under section (Making of interim EDMOs) for an order authorising them to make an interim EDMO in respect of the dwelling and an order determining the lease or licence, and

    (b) the residential property tribunal has decided to authorise the authority to make an interim EDMO in respect of the dwelling.

    (5) An order under this paragraph may include provision requiring the local housing authority to pay such amount or amounts to one or more of the lessor, lessee, licensor or licensee by way of compensation in respect of the determination of the lease or licence as the tribunal determines.
    (6) Where—

    (a) a final EDMO is in force in respect of a dwelling, and

    (b) the tribunal makes an order requiring the local housing authority to pay an amount of compensation to a lessor, lessee, licensor or licensee in respect of the determination of a lease or licence of the dwelling,

    the tribunal must make an order varying the management scheme contained in the final EDMO so as to make provision as to the payment of that compensation.
    Termination of EDMOs: financial arrangements
    23 (1) This paragraph applies where an interim EDMO or final EDMO ceases to have effect for any reason.
    (2) If, on the termination date for an interim EDMO, the total amount of rent or other payments collected or recovered as mentioned in paragraph 5(3) exceeds the total amount of—

    (a) the authority's relevant expenditure, and

    (b) any amounts of compensation payable to third panics by virtue of orders under section (Authorisation to make interim EDMOs)(4) or (Compensation payable to third parties)(2) or decisions of the authority under section (Making of final EDMOs)(4) or (Compensation payable to third parties)(3),

    the authority must, as soon as possible after the termination date, pay the balance to the relevant proprietor.
    (3) If, on the termination date for a final EDMO, any balance is payable to—

    (a) a third party,

    (b) a dispossessed landlord or tenant, or

    (c) the relevant proprietor,

    in accordance with the management scheme under paragraph 13, that amount must be paid to that person by the local housing authority in the manner provided by the scheme.
    (4) Sub-paragraphs (5) and (6) apply where, on the termination date for an interim EDMO or final EDMO, the total amount of rent or other payments collected or recovered as mentioned in paragraph 5(3) is less than the total amount of the authority's relevant expenditure together with any such amounts of compensation as are mentioned in sub-paragraph (2)(b) above.
    (5) The authority may recover from the relevant proprietor—

    (a) the amount of any relevant expenditure (not exceeding the deficit mentioned in sub-paragraph (4)) which he has agreed in writing to pay either as a condition of revocation of the order or otherwise, and

    (b) where the relevant proprietor is a tenant under a lease in respect of the dwelling, the amount of any outstanding service charges payable under the lease.

    (6) In the case of an interim EDMO ceasing to have effect, the authority may recover the deficit mentioned in sub-paragraph (4) from the relevant proprietor if, in their opinion, he unreasonably refused to consent to the creation of an interest or right as mentioned in paragraph 2(3)(c) while the order was in force.
    (7) The provisions of any of sub-paragraphs (2) to (6) do not, however, apply in relation to the order if—

    (a) the order is followed by a final EDMO, and

    (b) the management scheme contained in that final EDMO provides for those sub-paragraphs not to apply in relation to the order (see paragraph 13(4)(c) and (d)).

    (8) Any sum recoverable by the authority under sub-paragraph (5) or (6) is, until recovered, a charge on the dwelling.
    (9) The charge takes effect on the termination date for the order as a legal charge which is a local land charge.
    (10) For the purpose of enforcing the charge the authority have the same powers and remedies under the Law of Property Act 1925 (c. 20) and otherwise as if they were mortgagees by deed having powers of sale and lease, of accepting surrenders of leases and of appointing a receiver.
    (11) The power of appointing a receiver is exercisable at any time after the end of the period of one month beginning with the date on which the charge takes effect.
    (12) In this paragraph—
    "dispossessed landlord or tenant" means a person who was a lessor, lessee, licensor or licensee under a lease or licence determined by an order under paragraph 22;
    "relevant expenditure" has the same meaning as in paragraph 5 (in relation to an interim EDMO) or paragraph 13 (in relation to a final EDMO);

    1319
    "service charge" has the meaning given by section 18 of the Landlord and Tenant Act 1985 (c. 70);
    "the termination date" means the date on which the order ceases to have effect.
    Termination of EDMOs: leases, agreements and proceedings
    24 (1) This paragraph applies where—

    (a) an interim EDMO or final EDMO ceases to have effect for any reason, and

    (b) the order is not immediately followed by a further order under this Chapter.

    (2) As from the termination date, an agreement which (in accordance with paragraph 3 or 11) has effect as a lease or licence granted by the authority under paragraph 2 or 10 has effect with the substitution of the relevant proprietor for the authority.
    (3) If the relevant proprietor is a lessee, nothing in a superior lease imposes liability on him or any superior lessee in respect of anything done before the termination date in pursuance of the terms of an agreement to which sub-paragraph (2) applies.
    (4) If the condition in sub-paragraph (5) is met, any other agreement entered into by the authority in the performance of their duties under section (Local housing authority's duties once interim EDMO in force)(1) to (3) or (Local housing authority's duties once final EDMO in force)(1) to (3) in respect of the dwelling has effect, as from the termination date, with the substitution of the relevant proprietor for the authority.
    (5) The condition is that the authority serve a notice on the other party or parties to the agreement stating that sub-paragraph (4) applies to the agreement.
    (6) If the condition in sub-paragraph (7) is met—

    (a) any rights or liabilities that were rights or liabilities of the authority immediately before the termination date by virtue of any provision of this Chapter, or under any agreement to which sub-paragraph (4) applies, are rights or liabilities of the relevant proprietor instead, and

    (b) any proceedings instituted or continued by or against the authority by virtue of any such provision or agreement may be continued by or against the relevant proprietor instead,

    as from the termination date.
    (7) The condition is that the authority serve a notice on all interested parties stating that sub-paragraph (6) applies to the rights or liabilities or (as the case may be) the proceedings.
    (8) If by virtue of this paragraph a relevant proprietor becomes subject to any liability to pay damages in respect of anything done (or omitted to be done) before the termination date by or on behalf of the authority, the authority are liable to reimburse to the relevant proprietor an amount equal to the amount of the damages paid by him.
    (9) This paragraph applies to instruments as it applies to agreements.
    (10) In this paragraph—
    "agreement" includes arrangement;
    "the termination date" means the date on which the order ceases to have effect.
    EDMOs: power of entry to carry out work
    25 (1) The right mentioned in sub-paragraph (2) is exercisable by the local housing authority, or any person authorised in writing by them, at any time when an interim EDMO or final EDMO is in force.
    (2) That right is the right at all reasonable times to enter any part of the dwelling for the purpose of carrying out works, and is exercisable as against any person having an estate or interest in the dwelling.
    (3) If, after receiving reasonable notice of the intended action, any occupier of the dwelling prevents any officer, employee, agent or contractor of the local housing authority from carrying out
    1320
    work in the dwelling, a magistrates' court may order him to permit to be done on the premises anything which the authority consider to be necessary.
    (4) A person who fails to comply with an order of the court under sub-paragraph (3) commits an offence.
    (5) A person who commits an offence under sub-paragraph (4) is liable on summary conviction to a fine not exceeding level 5 on the standard scale.

  PART 4

    APPEALS
    Appeals: decisions relating to EDMOs
    26 (1) A relevant person may appeal to a residential property tribunal against—

    (a) a decision of the local housing authority to make a final EDMO,

    (b) the terms of a final EDMO (including the terms of the management scheme contained in it), or

    (c) the terms of an interim EDMO on the grounds that they do not provide for one or both of the matters mentioned in paragraph 5(5)(a) and (b) (which relate to payments of surplus rent etc.).

    (2) Where an appeal is made under sub-paragraph (1)(c)—

    (a) the appeal may be brought at any time while the order is in force (with the result that nothing in sub-paragraph (3) or paragraph 27 applies in relation to the appeal); and

    (b) the powers of the residential property tribunal under paragraph 28 are limited to determining whether the order should be varied by the tribunal so as to include a term providing for the matter or matters in question, and (if so) what provision should be made by the term.

    (3) If no appeal is brought under this paragraph in respect of a final EDMO within the time allowed by paragraph 27 for making such an appeal, the order is final and conclusive as to the matters which could have been raised on appeal.
    Appeals: time limits for appeals under paragraph 26
    27 (1) This paragraph applies in relation to an appeal under paragraph 26 in respect of a final EDMO.
    (2) Any such appeal may be made within the period of 28 days beginning with the date specified in the notice under paragraph 7(5) of Schedule 6 (as applied by section (Making of final EDMOs)(5)) as the date on which the order was made.
    (3) A residential property tribunal may allow an appeal to be made to it after the end of the period mentioned in sub-paragraph (2) if it is satisfied that there is a good reason for the failure to appeal before the end of that period (and for any delay since then in applying for permission to appeal out of time).
    Appeals: powers of residential property tribunal on appeal under paragraph 26
    28 (1) This paragraph applies to an appeal to a residential property tribunal under paragraph 26 in respect of an interim EDMO or a final EDMO.
    (2) The appeal—

    (a) is to be by way of a re-hearing, but

    (b) may be determined having regard to matters of which the authority were unaware.

    (3) The tribunal may—

    (a) in the case of an interim EDMO, vary the order as mentioned in paragraph 26(2)(b), or

    (b) in the case of a final EDMO, confirm or vary the order or revoke it as from the date of the tribunal's order.

    "The operative time "for the purposes of paragraph 9(2)
    29 (1) This paragraph defines "the operative time" for the purposes of paragraph 9(2).
    (2) If no appeal is made under paragraph 26 before the end of the period of 28 days mentioned in paragraph 27(2), "the operative time" is the end of that period.
    (3) If an appeal is made under paragraph 26 before the end of that period, and a decision is given on the appeal which confirms the order, "the operative time" is as follows—

    (a) if the period within which an appeal to the Lands Tribunal may be brought expires without such an appeal having been brought, "the operative time" is the end of that period;

    (b) if an appeal to the Lands Tribunal is brought, "the operative time" is the time when a decision is given on the appeal which confirms the order.

    (4) For the purposes of sub-paragraph (3)—

    (a) the withdrawal of an appeal has the same effect as a decision which confirms the order, and

    (b) references to a decision which confirms the order are to a decision which confirms it with or without variation.

    Right to appeal against decision or refusal to vary or revoke EDMO
    30 A relevant person may appeal to a residential property tribunal against—

    (a) a decision of a local housing authority to vary or revoke an interim EDMO or a final EDMO, or

    (b) a refusal of a local housing authority to vary or revoke an interim EDMO or a final EDMO.

    Time limits for appeals under paragraph 30
    31 (1) This paragraph applies in relation to an appeal under paragraph 30 against a decision to vary or revoke, or (as the case may be) to refuse to vary or revoke, an interim EDMO or a final EDMO.
    (2) Any such appeal must be made before the end of the period of 28 days beginning with the date specified in the notice under paragraph 11, 16, 19 or 22 of Schedule 6 (as applied by paragraph 8 or 17 of this Schedule (as the case may be)) as the date on which the decision concerned was made.
    (3) A residential property tribunal may allow an appeal to be made to it after the end of the period mentioned in sub-paragraph (2) if it is satisfied that there is a good reason for the failure to appeal before the end of that period (and for any delay since then in applying for permission to appeal out of time).
    Powers of residential property tribunal on appeal under paragraph 30
    32 (1) This paragraph applies to an appeal to a residential property tribunal under paragraph 30 against a decision to vary or revoke, or (as the case may be) to refuse to vary or revoke, an interim EDMO or final EDMO.
    (2) The appeal—

    (a) is to be by way of a re-hearing, but

    (b) may be determined having regard to matters of which the authority were unaware.

    (3) The tribunal may confirm, reverse or vary the decision of the local housing authority.
    (4) If the appeal is against a decision of the authority to refuse to revoke the order, the tribunal may make an order revoking the order as from a date specified in its order.
    "The operative time" for the purposes of paragraphs 6, 7, 15 and 16
    33 (1) This paragraph defines "the operative time" for the purposes of—

    (a) paragraph 6(2) or 7(3) (variation or revocation of interim EDMO), or

    1322

    (b) paragraph 15(2) or 16(3) (variation or revocation of final EDMO).

    (2) If no appeal is made under paragraph 30 before the end of the period of 28 days mentioned in paragraph 31(2), "the operative time" is the end of that period.
    (3) If an appeal is made under paragraph 30 before the end of that period, and a decision is given on the appeal which confirms the variation or revocation, "the operative time" is as follows—

    (a) if the period within which an appeal to the Lands Tribunal may be brought expires without such an appeal having been brought, "the operative time" is the end of that period;

    (b) if an appeal to the Lands Tribunal is brought, "the operative time" is the time when a decision is given on the appeal which confirms the variation or revocation.

    (4) For the purposes of sub-paragraph (3)—

    (a) the withdrawal of an appeal has the same effect as a decision which confirms the variation or revocation appealed against; and

    (b) references to a decision which confirms a variation are to a decision which confirms it with or without variation.

    Right to appeal against decision in respect of compensation payable to third parties
    34 (1) This paragraph applies where a local housing authority have made a decision under section (Making of final EDMOs)(4) or (Compensation payable to third parties)(3) as to whether compensation should be paid to a third party in respect of any interference with his rights in consequence of a final EDMO.
    (2) The third party may appeal to a residential property tribunal against—

    (a) a decision by the authority not to pay compensation to him, or

    (b) a decision of the authority so far as relating to the amount of compensation that should be paid.

    Time limits for appeals under paragraph 34
    35 (1) This paragraph applies in relation to an appeal under paragraph 34 against a decision of a local housing authority not to pay compensation to a third party or as to the amount of compensation to be paid.
    (2) Any such appeal must be made—

    (a) where the decision is made before the final EDMO is made, within the period of 28 days beginning with the date specified in the notice under paragraph 7(5) of Schedule 6 (as applied by section (Making of final EDMOs)(5)) as the date on which the order was made, or

    (b) in any other case, within the period of 28 days beginning with the date the authority notifies the third party under section (Compensation payable to third parties)(4).

    (3) A residential property tribunal may allow an appeal to be made to it after the end of the period mentioned in sub-paragraph (2) if it is satisfied that there is good reason for the failure to appeal before the end of that period (and for any delay since then in applying for permission to appeal out of time).
    Power of residential property tribunal on appeal under paragraph 34
    36 (1) This paragraph applies in relation to an appeal under paragraph 34 against a decision of a local housing authority not to pay compensation to a third party or as to the amount of compensation to be paid.
    (2) The appeal—

    (a) is to be by way of re-hearing, but

    (b) may be determined having regard to matters of which the authority were unaware.

    (3) The tribunal may confirm, reverse or vary the decision of the local housing authority.
    (4) Where the tribunal reverses or varies the decision of the authority, it must make an order varying the management scheme contained in the final EDMO accordingly.
    Meaning of "relevant person" for the purposes of this Part
    37 In this Part of this Schedule "relevant person" means any person who has an estate or interest in the dwelling (other than a person who is a tenant under a lease or licence granted under paragraph 2(3)(c) or 10(3)(c))."
    On Question, amendment agreed to.
    Schedule 7 [Penalty charge notices under section 148]:
    Lord Rooker Lord Rooker moved Amendment No. 210B:
    Page 206, line 29, after "amount" insert "(not exceeding £500)"
    On Question, amendment agreed to.
    On Question, Whether Schedule 7, as amended, shall stand part of the Bill?
    Lord Tebbit: I do not want to argue unduly with the provisions of this part of the Bill but I wonder whether I could draw the Minister's attention to a problem. I am not sure whether the housing management orders relate to it. That is the case where a property is in the estate of a person who dies intestate. I have in mind a property I know of because I pass it every day as I walk my dogs, which has been vacant for over three and a half years now, since the death of its owner, and which is gradually falling into decay. It seems to me that this matter is in the hands of what one would broadly call government in its most extended form. I wonder whether the Minister has any feelings about how this matter might he dealt with, and whether these orders could be applied to such properties?
    Lord Rooker: The short answer to the noble Lord, Lord Tebbit, is yes—not relating to that specific property, but the circumstances he describes. When we debated this, we raised the issue. It would apply even if, for example, the circumstances were similar to the ones the noble Lord described, where nothing is known about the owner but the property is there, affecting the rest of the community and causing problems. So it would be capable of being considered under the empty dwelling management orders proposals in this Bill.
    Schedule 7, as amended, agreed to.
    Clauses 149 to 151 agreed to.
    Lord Rooker Lord Rooker moved Amendments Nos. 210C to 210E:
    After Clause 151, insert the following new clause—

    POWER TO REQUIRE ESTATE AGENTS TO BELONG TO A REDRESS SCHEME
    (1) The Secretary of State may by order require every estate agent to be a member of an approved redress scheme.
    (2) Acting as estate agent for the seller of a residential property in contravention of such an order is a breach of duty under this Part.
    (3) Before making such an order the Secretary of State must be satisfied that he has approved one or more redress schemes such that every estate agent who is (or will be) subject to the duty imposed by the order is eligible to join an approved redress scheme.
    1324
    For this purpose "estate agent" does not include a person who is (by virtue of a prohibition imposed by or under the Estate Agents Act 1979 (c. 38)) unable lawfully to act as estate agent for the seller of a residential property.
    (4) An order under this section may—

    (a) exclude estate agents of a prescribed description from any duty imposed under subsection (1);

    (b) limit any duty so imposed so that it applies only in relation to relevant complaints of a prescribed description.

    (5) Nothing in this section is to be taken as preventing an approved redress scheme from providing—

    (a) for membership to be open to persons who are not subject to any duty to belong to an approved redress scheme;

    (b) for the investigation and determination of complaints, other than those in relation to which such a duty applies, made against members who have voluntarily accepted the jurisdiction of the scheme over such complaints;

    (c) for the exclusion from investigation and determination under the scheme of any complaint in such cases or circumstances as may be specified in the scheme.

    (6) In this section and sections (Approval of redress schemes) and (Withdrawal of approval)—
    "approved redress scheme" means a redress scheme that is for the time being approved under section (Approval of redress schemes);
    "estate agent" means a person who acts as estate agent for sellers of residential properties for which a home information pack is (or will be) required under this Part;
    "redress scheme" means a scheme under which certain relevant complaints may be investigated and determined by an independent person (referred to in those sections as "the ombudsman"); and
    "relevant complaint" means a complaint against an estate agent which—

    (a) is made by a person who at the material time is the seller or a potential buyer of a residential property; and

    (b) relates to an act or omission affecting the complainant in the course of the estate agent's activities in relation to a home information pack that is (or will be) required for that property (including the giving of advice as to whether such a pack is required).

    (7) For the purposes of the law relating to defamation, proceedings under an approved redress scheme in relation to the investigation and determination of a complaint which is subject to an order under this section are to be treated in the same way as proceedings before a court."
    After Clause 151, insert the following new clause—

    APPROVAL OF REDRESS SCHEMES
    (1) If the Secretary of State considers that a redress scheme (including one made by him or in pursuance of arrangements made by him) is satisfactory for the purposes of section (Power to require estate agents to belong to a redress scheme), he may approve it for those purposes.
    (2) In determining whether a redress scheme is satisfactory the Secretary of State shall have regard to—

    (a) the provisions of the scheme;

    (b) the manner in which the scheme will be operated (so far as can be judged from the facts known to him); and

    (c) the respective interests of members of the scheme and of sellers and potential buyers of residential properties.

    (3) A redress scheme may not be approved unless it makes satisfactory provision about the following matters (among other things)—

    (a) the matters about which complaints may be made (which may include non-compliance with the provisions of a code of practice or other document);

    1325

    (b) the ombudsman's duties and powers in relation to the investigation and determination of complaints (which may include power to decide not to investigate or determine a complaint);

    (c) the provision of information by the ombudsman to—

    (i) persons exercising functions under other schemes providing a means of redress for consumers; and

    (ii) the Secretary of State or any other person exercising regulatory functions in relation to the activities of estate agents.

    (4) An application for approval of a redress scheme shall be made in such manner as the Secretary of State may determine, accompanied by such information as the Secretary of State may require.
    (5) The person administering an approved redress scheme shall notify the Secretary of State of any change to the scheme as soon as practicable after the change is made."
    After Clause 151, insert the following new clause—

    WITHDRAWAL OF APPROVAL
    (1) The Secretary of State may withdraw his approval of a redress scheme.
    (2) But before withdrawing his approval, the Secretary of State shall serve on the person administering the scheme a notice stating—

    (a) that he proposes to withdraw his approval;

    (b) the grounds for the proposed withdrawal of approval; and

    (c) that representations about the proposed withdrawal may be made within such period of not less than 14 days as is specified in the notice.

    (3) The Secretary of State shall give notice of his decision on a proposal to withdraw approval, with his reasons, to the person administering the scheme.
    (4) Withdrawal of approval has effect from such date as may be specified in that notice.
    (5) The person administering the scheme shall give a copy of a notice under subsection (3) to every member of the scheme."
    On Question, amendments agreed to.
    Clauses 152 to 154 agreed to.
    Clause 155 [Index of defined expressions: Part 5]:
    Lord Rooker Lord Rooker moved Amendment No. 210F:
    Page 104, line 26, at end insert—

    "The Market

    Section 131(A1)"

    The noble Lord said: I beg to move.
    12.15 p.m.
    Lord Hanningfield: I apologise for earlier. I arrived at the House just a moment or two before we started. It is also my birthday today.
    In moving these amendments, let me begin by saying that we on these Benches in no way condone those who systematically and cynically abuse the right to buy scheme. It is indeed right and proper that measures be introduced to deal with it.
    Noble Lords: Oh!
    Lord Hanningfield: I am dealing with Clause 157, am I not?
    The Deputy Chairman of Committees: If I may, I called Amendment 210F, which is in the name of the
    1326
    noble Lord, Lord Rooker: "Page 104, line 26, insert the words as printed on the Marshalled List". I thought the noble Lord wished to reply.
    On Question, amendment agreed to.
    Clause 155, as amended agreed to.
    Clause 156 agreed to.
    Clause 157 [Extension of qualifying period for right to buy]:
    On Question, Whether Clause 157 shall stand part of the Bill?
    Lord Hanningfield: I think I am right now. Again, I apologise. We are now obviously on the right to buy scheme.
    Let me begin by saying that we on these Benches in no way condone those who systematically and cynically abuse the right to buy scheme. It is indeed right and proper that measures be introduced to deal with it. We additionally welcome those new provisions that deal with the scam whereby people immediately want to buy their homes when a demolition order is put in place.
    Although the Government have been rather late converts to the principle of right to buy, it is worth remembering that is has enabled individuals and families, for the first time in many cases, to take the opportunity to own their own homes. That is an important principle and one that we should safeguard at all costs. We are, in effect, probing the Government as to why they feel extending the qualifying period is a necessary step forward. The Government are wrong to think that by increasing the qualifying period, and reducing the available discount, they will suddenly safeguard the number of available social houses.
    The Minister will be aware that fewer social houses are being built by a combination of local authorities and registered social landlords than at any time for more than a decade. Kate Barker states in her report:
    "In 2001, around 175,000 dwellings were built in the UK—the lowest level since the Second World War."
    That is the real reason for the lack of affordable housing. Indeed, this understanding is backed up by the Council of Mortgage Lenders, which suggests that the impact of the right to buy on the availability of social housing has been patchy and insignificant. So the argument that the real problem with the availability of social housing is the right to buy seems not to be supported by lenders, based on survey evidence.
    We are rather less enthusiastic about the provisions for reducing discount in the south-east. It is now becoming very difficult indeed to acquire a house in London, even with the discount that the Government currently apply. People used to apply for a discount under the right to buy in order to put down a deposit on their mortgage. Because the price of London houses is now so high, it is very difficult for anyone to use the right to buy provisions accordingly. Furthermore, the scheme has now been running for some time. What evidence, therefore, has the Minister's department collected that such a scheme is indeed tackling abuse?

    1327
    My Lords, although we welcome the Government's attempt to crack down on abuses in the right to buy scheme, we are less than convinced that cracking down on the scheme itself, as the Government intend to do in Clause 157, is the most appropriate way forward. The failings are not in the scheme itself, but in the Government's woeful attempts at building enough social housing and—I stress before the Minister corrects me—starving local authorities of sufficient finance to do so. Indeed the Government's record on social housing is not one that any administration should be proud of.
    Lord Bassam of Brighton: I—
    Baroness Maddock: I should like to speak.
    The Deputy Chairman of Committees: I had originally put the Question that the Clause stand part, and I understand that, after this, I do not repeat the Question and the debate goes on. Finally, when the Committee has come to a decision, we put the Question that the clause, either as amended or not, stand part of the Bill. I understand that is the procedure. There are separate instructions for amendments and clause stand part debates in the rules of procedure.
    Baroness Maddock: I thank the Deputy Chairman of Committees for that explanation. I was slightly confused because there is an amendment with the debate on clause stand part, which is why I thought somebody might be saying something about it.
    I should like to say a few words about right to buy. I could say a lot more but, because we want to get through business today, I will be fairly brief. We on these Benches broadly welcome the changes the Government have brought to the scheme. There are particular areas we welcome. There have been considerable difficulties in areas where demolition is planned and people have been able to get discounts and buy up houses. Obviously, it is a sensible move in that connection. Extending the length of time that people have to be residents to get their discounts, and the time for pay back and so on, is important.
    We on these Benches have always thought that if we are going to give the right to buy to tenants, it should be a local decision of the local council. I would welcome it if the Government, in moving towards giving local councils more discretion over many areas, would think about this. The people who know best about the housing situation in their area, and the people who draw up their housing strategies, are the local councils. That is what we have always said about right to buy, and what we would like to see.
    Having said that, my experience of right to buy in two very different areas throws up different problems. For many years I was a councillor in Southampton, and we had a lot of council properties. Over the years, the properties that we lost were family homes. That meant that we had great difficulty housing people with
    1328
    children; they ended up going into blocks of flats. The whole problem with the scheme is that one cannot replace the houses that one has sold.
    Then there were other problems. In the area of the university, people would buy their homes at a discount and then sell to other people who wanted to rent them to students. There was a lot of building going on around Southampton, and once people had bought their houses they did not want to live on the council estates any more. They often bought houses of much lower quality than the council home that they had bought. Then we would see a whole street decline as it was let out to students. I am not damning students, but we all know that their interest is not in the garden and what the house looks like at the front.
    One of the aims of right to buy, however, was to make areas much more diverse in terms of community. Where I live now in Berwick-upon-Tweed, that certainly happened. One reason for that was that no houses were built outside the estate for people to move off it to. The point of the scheme was to help people to own their own homes if they wanted to, but the expense was that those people wanting to rent homes did not have the same variety as before.
    In recent times, we have seen efforts by the Government to bring social housing up to their so-called decent homes standard. There has been a boom in right to buy, and some of the cash for decent homes has been eaten up in that area. There has been considerable concern about that. Over the years, a huge amount has been involved in right to buy. I saw a headline somewhere that said that right-to-buy sales could plug the decent homes gap 10 times over. We still have problems, but I welcome the efforts of the Government to try to make sure that we are genuinely helping people to own their own homes, not helping other people to make lots of money and others to come in and change whole areas. That was not the point of the scheme when it started, and it is important that we address that.
    As the debate continues, I hope that we may be able to deal with some of the other issues that surround right to buy.
    Lord Bassam of Brighton: Clause 157 amends Section 119 of the Housing Act 1985 to extend from two years to five years the period which tenants must spend qualifying for the right-to-buy scheme. The two-year period is too short. Tenants can count any period of tenancy with a wide range of public bodies, no matter how long ago, towards qualifying for right to buy. That means that many tenants who have previously spent time as public sector tenants qualify for right to buy as soon as they move into their council homes. Extending the period to five years will encourage tenants to make a longer-term commitment to the community before they can buy. That picks up one of the issues raised by the noble Baroness. It is worth remembering that, when right to buy was introduced in 1980, the qualification period was set at three years and subsequently reduced.
    We want to stress two other matters. First, Clause 157 also amends Section 129 of the Housing Act 1985 to ensure that tenants will be eligible for the

    1329
    same level of discount after qualifying for five years as they are after five years under the current rules. They will be entitled to 35 per cent on a house, or 50 per cent on a flat, subject of course to the overriding limit on discount for the area in which they live. Secondly, Clause 157 will apply only to tenants who take up wholly new tenancies that begin on or after the day on which it comes into effect. That means that existing secure and public sector tenants will not be affected, provided that they remain as public sector tenants continuously up until the time at which they exercise their right to buy. We did not consider it fair to move the goalposts for existing tenants.
    Clause 157 attracted the support of the Home Ownership Task Force, which was asked to identify the scope for better targeting and design of government schemes to help those in housing need to meet their home ownership aspirations. It is intended to foster future tenants' sense of commitment to the area in which they live. It is an important measure that makes some sensible and practical adjustments, and it should deal with some of the abuses that even the noble Lord. Lord Hanningfield, fully acknowledged exist with the current scheme. It also brings some balance back to right to buy, which we fully support; I heard what he said about opposing right to buy in the early years, but all parties now see its benefits. We have to ensure that it works well and does not provide scope for rip-offs. No one can support that form of exploitation at the expense of the public purse. I hope that the noble Lord will no longer object to the clause.
    Clause 157 agreed to.
    Lord Borrie Lord Borrie moved Amendment No. 211:
    After Clause 157, insert the following new clause—

    EXCEPTIONS TO RIGHT TO BUY: RURAL AREAS
    The National Authority may by order designate rural areas as exempt from the right to buy scheme."
    The noble Lord said: The aim of this proposed provision is to exclude the right to buy in certain rural areas—the smaller places where there are populations of 3,000 and under. That would make the right-to-buy restriction in line with the right-to-acquire scheme for other social housing landlords. The purpose is pretty straightforward; it is to preserve an adequate supply of affordable rented housing for local people in rural areas.
    The right to acquire and the right to buy are two very similar schemes, the former available to tenants in properties owned by registered social landlords and the latter to tenants of local-authority-owned properties. Currently, there is significant disparity in the application of the schemes in relation to properties in rural areas. The right to acquire is not available now to tenants in designated small rural settlements—those with a population of 3,000 or under. The reason for that is to preserve the supply of affordable rented housing for local people. That justification applies equally to localauthority-owned properties in similar locations, and the right-to-buy scheme should be changed to mirror that element of the right-to-acquire scheme.
    The difficulties of replacing properties through right to buy in rural areas are commonly accepted. First, there is the price of housing in rural areas, which is often exacerbated by the purchase of second homes by better-off people. Secondly, the availability of land severely limits the scope for newly built housing, and the potential to buy on the open market is limited due to the overall size of local housing markets. That is made more acute by the removal of local authority social housing grant. Securing an ongoing supply of social housing for rural communities is surely essential to achieving sustainable communities. My proposed change to the right-to-buy scheme seeks to realise sustainable communities by ensuring an ongoing supply of social housing for future generations in rural areas.
    I have been assisted by the Local Government Association on the amendment. I beg to move.
    Lord Dixon-Smith: My Amendment No. 212 is grouped with the amendment. It is aimed in a somewhat similar direction, but I am bound to say that I do not find myself in sympathy with the amendment moved by the noble Lord. I do not see why particular sectors of the rural community should be excluded from right to buy, as available to the rest of the country. It is not as though the shortage of suitable social housing exists exclusively in rural areas. It exists in most urban areas in the country. This great city of London—if I could include that in the wider sense of the word "great"—probably has the most acute form of that problem: we see that with essential workers completely unable to get suitable housing. But the right to buy exists here and, as the Minister has indicated, there is general agreement that the right to buy has been beneficial. A discriminatory amendment of the sort that the noble Lord, Lord Borrie, has surprised me with—he is generally very broad-minded about such issues—would not be helpful.
    12.30 p.m.
    My noble friend Lord Hanningfield on the Front Bench has identified the source of the problem, which is the static building rate that applies nationally and appears in an acute form in many rural communities and particularly the smaller communities. There are a number of reasons for that, which I will not go into now because it would take too long. I am under some time pressure and I want to get to the end of the debate.
    Amendment No. 212 is addressed to a different issue. It looks as though for the coming decade the major source of new social housing will be as part of a great swathe of new development required across the country. We have seen various figures as to what the proportion of social housing should be where major development takes place. Indeed the Minister's honourable friend—at least I assume he is an honourable friend since he is now back in the Labour Party—the Mayor of London would like to see that figure as high as 50 per cent.
    The fact is that those houses are not free. They have to be paid for, and they are paid for by one of three groups of people—or possibly a fourth. I declare a

    1331
    retrospective interest in the subject, having once been involved in Section 106 negotiation, so I have some feeling in the matter. In such developments, social housing will be paid for either by the original owners of the site, or by the developer, or—this is where it starts to become dangerous if the proportion goes too high—in the end by the purchasers of the final properties on the rest of the site. The cost of the social housing is borne in different proportions by those three groups of people.
    There is indirectly a fourth participant in that equation—the Treasury has an interest because the cost of those social houses comes off the profitability of a new development and therefore reduces the Exchequer's take in gains taxes. The Treasury is in a sense a participant as well. That equation can and does produce a large volume of social housing. The Office of the Deputy Prime Minister's considerable ambitions to increase the building rate is a matter with which I have some sympathy. However, the purpose of building social housing—which is paid for largely by individuals—is defeated if the right to buy can apply straight away once the houses become social houses—when they are transferred to the people. When we were making our Section 106 agreement, the biggest obstacle we had to overcome was the right to buy. There are ways round it, but it would be much more sensible, if it were clearly stated that there was a period of time during which social housing provided in that way should not have the right to buy applied to it.
    Amendment No. 212 is a probing amendment. Nothing would please me more than if the Minister could demonstrate to me that it is completely unnecessary. If he can do that, I should be exceedingly happy and shall leave the Chamber in great glee. One should not have to go through all sorts of legal procedures and devices, as we had to, in order to ensure that where social benefit is provided to the community it remains as a social benefit to the community for a reasonable period of time. One can argue about the length of time. I have suggested 25 years in the amendment because I think for ever is too long and is not appropriate. I shall be interested to hear what the Minister has to say.
    Baroness Miller of Chilthorne Domer: I welcome the fact that the noble Lord, Lord Borrie, tabled his amendment to enable us to have this debate, but I agree with the noble Lord, Lord Dixon-Smith, that rural areas should not suffer an absolute blanket exemption from the right to buy.
    The statement made about a previous amendment by my noble friend Lady Maddock was absolutely right. The right people to make the decision about this matter are local authorities. They are charged with producing a housing needs document. They are also best placed to make a judgment about this matter. The blanket designation of settlement by size—whether they should be in or out of the right to buy—has not proved wildly successful either. The size of the population does not provide any measure for how
    1332
    much social housing it has or not, or what the pressure on that social housing is. These are all issues that come up in the housing needs assessment.
    Further than that, there are another couple of reasons why we would not want to designate rural areas in this blanket way, which was alluded to by my noble friend Lady Maddock. When one denies a group of people the right to buy their house, that section of the rural community will become less diverse, because it will be less attractive to those who are able to buy their own home. The likelihood is that that section of social housing will continue to be occupied by those who are unable to afford to buy. It will—I have seen it happen time and again—enter into a spiral of decline and become a real challenge to the local authority. If the Government are aiming for diversity of community, they should resist ghettoising—if I might use the word—sections of housing and particularly just choosing it by geographical area.
    I was quite surprised by the short memory—if I may say so—of the Conservative Bench because the problem with the right to buy, especially in rural areas, began with the fact that local authorities never had the right to replace the housing stock by using the capital receipts from that housing. In little villages which had 6, 10 or 20 houses, that inability proved fatal to the villages—not only in terms of social housing, but in terms of the post office and the pub, whose customers naturally fell off as the younger people had to move into the towns. It is still something I feel deeply about.
    I see the noble Baroness, Lady Hanham, shaking her head, but I can tell her that when I was leader of South Somerset District Council that was exactly what happened. I declare an interest as a Somerset county councillor. We are part of our local strategic partnership, and we are deciding how to spend the moneys from the extra second homes tax at the moment. I hope that county councils will make a decision to devolve that money to local strategic partnerships, which will then decide to put it into affordable housing.
    The Minister may be aware that the rural commission of the Local Government Association met in Bath on Tuesday of this week. It passed an emergency motion regarding affordable housing in rural areas and the desperate situation that exists. If the Minister has not yet seen that motion I hope that he will take time to look at it. The point of interest beyond the words of that motion was that it was passed unanimously—with everyone from every party supporting it. That says something regarding the depth of feeling in rural areas.
    The key is issue is making sure that rural areas have the money to spend on social housing. It is key to retaining jobs, as the Minister knows. Finally, I should like to comment on exception sites. Perhaps it was the noble Lord, Lord Borrie, who mentioned that land was expensive, and, of course, it is. But extremely good use has been made of exception sites—that is where housing may be released and developed for social housing use only, never for private housing. It has been used successfully by bodies such as the Rural Housing Trust, to whose work I shall return in a later

    1333
    amendment. I hope that the Government will continue to encourage the use of exception sites and perhaps even to think how they may be encouraged more extensively through an amendment to the Bill. That is not something that I have thought of doing myself, but I might be interested to come back to that later.
    Lord Livsey of Talgarth: I shall not detain the Committee for long but I feel passionately about this issue. I am pleased that the noble Lord, Lord Borrie, has moved the amendment and that the noble Lord, Lord Dixon-Smith, has tabled Amendment No. 212.
    If you have ever been confronted as a younger person, as I was once, with two children, a wife and family, not to be able to afford to compete with second home owners in your own community is really the end. I had an extremely bleak experience. There was no social housing anyway, because that had dried up. This is an important amendment. The pleas made for local authorities to be in the driving seat regarding these policies are important, because, as has been said, housing needs are assessed by them.
    However, there is a famine of social rented housing in the countryside and young people cannot compete in the private market at all. One of the problems is that builders are building executive homes in villages and in comparison with the low wage economies in rural areas buying a home is cloud cuckoo land for young people. They cannot even look at those homes. Social exclusion is happening to young people from rural areas. This distorts community life; schools do not have so many children in them and eventually close down in many cases; older people dominate—there is nothing wrong with that—but to such an extent that there are not equal numbers of people of different ages in the community. GP practices are overrun in some places and social problems result.
    Commuters dominate in other places and second home owners in others. Often all occur in the same place. This problem has to be overcome. It results in few jobs for young people in rural areas and the local economy often dries up because people are spending money elsewhere, not in their local community. It is vital that this problem is overcome in the most practical ways possible. Indeed it should be in the forefront of ensuring that young people can actually live in their own communities.
    12.45 p.m.
    Baroness Maddock: I have much sympathy with the sentiments behind the amendment, but for the reasons that my noble friend has given, we may not be solving the problem that we are trying to tackle. Problems of affordable housing in rural areas are well documented and I was surprised that in speaking to his amendment, the noble Lord, Lord Dixon-Smith, seemed to think that the problems were just the same as in the city. Perhaps I could read him a few figures—86 per cent of rural housing is owner occupied or privately rented, whereas it is about 77 per cent in urban areas. In rural areas the social rented sector is only 13.4 per cent of total housing, compared with 22.4 per cent in urban areas. We also know that in 2002–03 house prices rose
    1334
    faster in rural areas than in towns. That shows us the scale of the problem, but the question is how we tackle it.
    As I said earlier, this should not be a blanket scheme; it should be up to local authorities to make their own decisions. In recent years the Government have moved towards giving power to local authorities and if Ministers wish to help, this would be one area in which that would be useful. The key to this is affordability. Trying to find ways of keeping affordable the houses that come in through social money is difficult. The noble Lord, Lord Dixon-Smith, talked of his own experience and trying to find legal ways of doing such things is difficult.
    However, there are schemes up and running. I understand that there is a scheme in Shropshire called the golden share scheme. Under it, the equity that has built up by having social money in affordable housing remains there and the houses remain affordable, whether one is buying or renting; so that when rented social housing is lost, at least it does not become a very high-priced second home. We on these Benches are looking at how we can put this into some national policy. But there are schemes working and I know that government departments know about the scheme in Shropshire. It is not an easy issue to tackle.
    For the reasons that I have outlined, although we understand the sentiments behind the amendment and what it is trying to achieve, it will solve some problems but re-create others. We do not support the amendment.
    Lord Bassam of Brighton: This has been a valuable 20 minutes. As a government spokesman I cannot accept the amendment, but I recognise the importance, validity and the urgency of the debate. In particular, I was struck by the words of the noble Baroness, Lady Miller of Chilthorne Domer. I have often pondered the problem myself. I grew up in a village and my mother was a council tenant. The stock of social housing in that village has shrunk as a product of right-to-buy and many of the friends with whom I grew up exercised their right, quite understandably. Sadly, in that part of Essex social and affordable housing in the rural communities has not been replaced.
    Our Government have made and renewed their commitment to ensuring that there is social housing in rural communities. For the first time in a generation the numbers of social housing units built in rural communities has begun to increase. We recognise that there is more to do in this field and the rural White Paper underlined our commitment to ensuring that more of the existing housing in rural areas is available to local people. That was the issue that the noble Baroness, Lady Miller, touched on with her heartfelt plea. It is an important issue. Many of my friends were forced to move away from the village because they could not rent and the available and emerging estates of new homes were there only for sale. They were beyond those ordinary working folk's pockets.
    Under Section 157 of the Housing Act 1985 landlords in certain specified areas may place restrictions on the resale of homes sold under the right-to-buy scheme. Landlords can choose between

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    requiring owners for at least three years to resell only to people who have lived or worked locally or, if landlords prefer, for the 10 years following initial purchase require that owners first offer the property back to the former landlord before selling it on the open market.
    I am sure that the noble Lord, Lord Borrie, will be aware that similar restrictions are in place in the seven national parks, in the 37 areas of outstanding natural beauty and in 30 areas designated as rural for this purpose by the Secretary of State. Together, these cover about 40 per cent of the land area of England. Clause 165 extends a right of first refusal to all other right-to-buy landlords wherever they are, but it explicitly retains the current system in national parks, AONBs and designated rural areas.
    Similar amendments to the one tabled by the noble Lord, Lord Borrie, were debated on Report in another place, as the Parliamentary Under-Secretary of State for the Office of the Deputy Prime Minister said at the time:
    "We recognise that there are pressures on affordable housing in many rural areas."—[Official Report, Commons, 11/5/04; col. 252.]
    However, exempting rural areas from the right to buy would, I think most contributors to this debate have said, unfairly discriminate against those who wanted to become home owners in those areas.
    It would be too inflexible and very sweeping for all tenants who happen to live in rural areas to be denied the chance of home ownership. The existing restrictions on reselling, which recycle former right-to-buy homes to local people and are already in place in a significant part of the country, are sufficient. Tenants can choose to buy or to continue to rent, while landlords can choose to impose one or other of the two resale restrictions, or not to include any restriction.
    I know that the Home Ownership Task Force considered the difference between the right-to-buy and right-to-acquire schemes in this respect. But it did not call for immediate change. It recommended that the rural restrictions for both schemes should be retained, with a view to alignment in the longer term. In response, we have said that we are committed to retaining the existing rural restrictions in both schemes, and that we do not plan to align them.
    A balance is needed here between respecting the quite proper aspirations of social tenants in rural areas to become home owners and the need to retain social housing for local people. Those who raised the issue in another place suggested that if the Government do not wish to restrict the availability of the right to buy in rural areas they might instead consider lowering the maximum discounts available to tenants in those areas. We have already done this in 41 areas in London and the south-east that are under the greatest housing pressure.
    The Minister for Housing responded by saying that we recognise that housing pressures may be driving up house prices in some rural areas and that, although we have no intention of introducing across-the-board
    1336
    restrictions, we will continue to monitor the situation. I can confirm that we will keep the position on maximum discounts under review. We believe that this more flexible approach is preferable to the amendment.
    I turn to the second amendment, which, in our view, is unnecessary. Most new social housing for rent, whether provided under a Section 106 agreement or on rural exception sites, is provided by registered social landlords. The right-to-buy scheme does not apply to assured tenants of registered social landlords, so it is unlikely that tenants living in new properties built under Section 106 agreements or on rural exception sites would be eligible for the right-to-buy scheme.
    As is commonly understood, the right to buy is only available to secure tenants of local authorities, and to pre-1988 secure tenants of non-charitable housing associations. Former local authority tenants of housing stock which has been transferred retain a preserved right to buy.
    Both the rural exceptions policy and Section 106 agreements can be used to secure the provision of new-build affordable housing. Affordable housing ranges from social rented housing generally provided by registered social landlords to low-cost home ownership schemes, such as shared ownership and housing for sub-market sale.
    The rural exceptions policy allows local planning authorities to grant permission for housing development within and adjoining villages, which the local plan would not otherwise release for housing, in order to provide affordable housing to meet local needs in perpetuity.
    Section 106 agreements are those between local authorities and developers. They are usually negotiated when planning permission is granted in respect of the use of land being developed. Planning obligations can be used to secure contributions from developers towards the provision of necessary infrastructure associated with the development, and the provision of affordable housing to meet identified needs based on up-to-date housing assessments.
    Baroness Miller of Chilthorne Domer: I am grateful to the Minister for his reference to exception sites. However, would he make a judgment on their value? He told us what they were, but he did not actually say whether he regards them as useful, very useful or essential. I would be grateful for any such indication.
    Lord Bassam of Brighton: They are useful, but I am aware of some statistics and I can see that we have a problem. What we are trying to suggest is that we need flexible means to address the problems. No doubt the Local Government Association rural commission will bring forward some further thoughts as a product of its recent motion.
    Tenants of social housing built or acquired by registered social landlords with public funds after 1 April 1997 may qualify for the right-to-acquire scheme under the Housing Act 1996 and be eligible to purchase their rented home at a discount. However, the right to acquire does not apply in areas designated as rural. These are generally small community settlements with a population of 3,000 people or fewer.

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    As this is the same coverage as rural exception sites, the social housing on such sites is already preserved for local people in perpetuity.
    We already have a range of means in place for preserving new social housing on rural exception sites or provided through Section 106 agreements. The amendment is public-spirited, but it is not necessary in order to achieve the ends that we all seek. I have listened hard to the debate and I think that there is more to do. There are other approaches—I was particularly interested in what the noble Baroness, Lady Maddock, had to say. From personal experience, going round the country and as leader of a local authority with rural communities remote to our major settlement, I can see that this is not an issue that will go away or one that can be left. We are addressing it through current policies.
    Lord Borrie: I am grateful to all those who have participated in the debate, which was probably rather longer than Ministers wished it to be. I am particularly grateful to those from the Liberal Democrat Benches who gave varied, I might even say disparate, but certainly balanced comments on the problem. I am most grateful to the Minister for a comprehensive response and I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 212 not moved.]
    Clause 158 agreed to.
    Clause 159 [Exceptions to the right to buy: houses due to be demolished]:
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 212A:
    Page 107, line 34, after "a" insert "final"
    The noble Lord said: This group of amendments relates to the aim of the demolition notice provisions and is designed to address loopholes in existing legislation. Currently, when tenants know that demolition is likely, they are able to buy at a discount knowing that when the property has to be repurchased using compulsory powers they will be entitled to full market value plus home loss compensation. This adversely affects the financial viability of regeneration schemes.
    In another place it was suggested that our original proposals did not deal adequately with regeneration schemes involving the phased demolition of blocks or areas over several years. Tenants in such areas are likely to be aware of demolition plans well in advance and may be tempted to exploit the rules. Stakeholders have also suggested that the existing clauses did not adequately address situations where landlords had compulsorily to purchase from local owner-occupiers, a process that, as most of us will have experienced or observed, may be subject to delays.
    We thought that there was force in those points and we have therefore decided to amend the procedure for demolition notices. There will now be a two-stage process. First, initial demolition notices—IDNs—will suspend a landlord's obligation to complete a right-to-buy purchase. Secondly, final demolition noticesFDNs—will terminate any right-to-buy claims and
    1338
    prevent any new ones being made. In both cases there will be a prescribed notification procedure that landlords must follow. Notices must set out the reasons for demolition and the effect of the notice served. Landlords must also publicise them locally, both in the local press and on the landlord's website—my notes say "if he has one"; I suppose that most landlords probably now do. But that is an obligation on them.
    1 p.m.
    The initial demolition notices are not capable of extension, although the final demolition notices may be extended on application to the Secretary of State. Either notice can be revoked by the Secretary of State if he takes the view that the landlord has no intention of demolishing the properties.
    We therefore propose, first, that an initial demolition notice, valid for no longer than five years and not extendable, may be served, and that will suspend the landlord's obligation to complete the right-to-buy sale. It will not prevent new right-to-buy applications being made but it will provide a breathing space in which landlords can properly develop schemes and, where necessary, follow the statutory compulsory purchase procedures. Tenants' interests are protected. Right-to-buy claims can continue to be made and will be processed as normal so that if a demolition plan fails to proceed, the application can then be completed.
    Secondly, final demolition notices can be served. These should be valid for two years rather than 18 months. Final demolition notices will end any existing right-to-buy claims and prevent any new ones being lodged.
    A landlord will be able to serve a final notice only if there are no owner-occupiers within the planned demolition area and acquisition of those properties is essential for the demolition plans to proceed, or if t here are such properties but binding agreements for the acquisition of the properties have been agreed and/or compulsory purchase orders have been successfully made and the landlord has served notices to treat or has made a vesting declaration in respect of all the owner-occupied properties within the planned demolition area.
    That proviso is important. It would be unfair to bring right-to-buy claims to an end and prevent new ones being made in cases where a regeneration scheme, and hence the need for demolition, depended upon the purchase of local owner-occupied properties which may never take place. So, if a CPO is necessary in order for demolition plans to go ahead and the CPO is not confirmed or is quashed by the courts, an IND will cease to have effect.
    For tenants who have made a valid right-to-buy claim, and an initial demolition notice or a final demolition notice is served before the transaction is completed, compensation will be available for conveyancing-related expenses incurred before the respective notice was served.
    We believe that the amendments will improve the Bill's original safeguards against exploitation by tenants, while providing sufficient safeguards against unreasonable behaviour by landlords. We hope that we have the balance right; I think that we probably have. I therefore ask the Committee to support the amendments. I beg to move.
    On Question, amendment agreed to.
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendments Nos. 212B to 212Y:
    Page 107, line 36, leave out ""demolition" and insert "final demolition"
    Page 108, line 2, leave out "and" and insert—
    "() stating that one of conditions A to C in paragraph 13A is satisfied in relation to the notice (specifying the condition concerned), and"
    Page 108, line 10, leave out "138A" and insert "138C"
    Page 108, line 14, leave out "18" and insert "24"
    Page 108, line 16, after "a" insert "final"
    Page 108, line 17, leave out "18" and insert "24"
    Page 108, line 18, leave out from "(4)" to end of line 19 and insert ", but this is subject to—

    (a) compliance with the conditions in sub-paragraphs (6) and (7) (in a case to which they apply), and

    (b) the provisions of paragraph 14(1) to (7)."

    Page 108, line 24, after "a" insert "final"
    Page 108, line 27, after "a" insert "final"
    Page 108, line 44, after "any" insert "final"
    Page 108, line 45, leave out "and" and insert "unless extended or revoked under paragraph 14,"
    Page 108, line 48, at end insert—
    "() that there may be a right to compensation under section 138C in respect of certain expenditure incurred in respect of any existing claim."
    Page 109, line 1, leave out "paragraph 14" and insert "paragraphs 13A and 14"
    Page 109, line 3, after "premises," insert "or of a reference to the acquisition or transfer of any premises,"
    Page 109, line 4, at end insert—
    "13A (1) A final demolition notice may only be served for the purposes of paragraph 13 if one of conditions A to C is satisfied in relation to the notice.
    (2) Condition A is that the proposed demolition of the dwelling-house does not form part of a scheme involving the demolition of other premises.
    (3) Condition B is that—

    (a) the proposed demolition of the dwelling-house does form part of a scheme involving the demolition of other premises, but

    (b) none of those other premises needs to be acquired by the landlord in order for the landlord to be able to demolish them.

    (4) Condition C is that—

    (a) the proposed demolition of the dwelling-house does form part of a scheme involving the demolition of other premises, and

    (b) one or more of those premises need to be acquired by the landlord in order for the landlord to be able to demolish them, but

    (c) in each case arrangements for their acquisition are in place.

    (5) For the purposes of sub-paragraph (4) arrangements for the acquisition of any premises are in place if—

    (a) an agreement under which the landlord is entitled to acquire the premises is in force, or

    (b) a notice to treat has been given in respect of the premises under section 5 of the Compulsory Purchase Act 1965, or

    (c) a vesting declaration has been made in respect of the premises under section 4 of the Compulsory Purchase (Vesting Declarations) Act 1981.

    (6) In this paragraph—
    "premises" means premises of any description;
    "scheme" includes arrangements of any description."
    Page 109, line 6, at end insert "final"
    Page 109, line 15, after "a" insert "final"
    Page 109, line 22, after "a" insert "final"
    Page 109, line 38, after "a" insert "final"
    Page 109, line 39, at end insert "final"
    Page 109, line 44, at end insert—
    "() The Secretary of State's consent under sub-paragraph (8) may be given subject to compliance with such conditions as he may specify."
    Page 109, line 45, leave out from "notice" to end of line 46 and insert "under paragraph 13 or 14 may be served on a person—"
    On Question, amendments agreed to.
    Clause 159, as amended, agreed to.
    Clause 160 [Right to buy: claim terminated by demolition notice]:
    Lord Rooker Lord Rooker moved Amendment No. 212Z:
    Leave out Clause 160 and insert the following new clause—

    RIGHT TO BUY: CLAIM SUSPENDED OR TERMINATED BY DEMOLITION NOTICE
    (1) In section 138 of the Housing Act 1985 (c. 68) (duty of landlord to convey freehold or grant lease), after the subsection (2C) inserted by section 170 of this Act, insert—
    "(2D) Subsection (1) also has effect subject to—

    (a) section 138A(2) (operation of subsection (1) suspended while initial demolition notice is in force), and

    (b) section 138B(2) (subsection (1) disapplied where final demolition notice is served)."

    (2) After section 138 of that Act insert—

    138A EFFECT OF INITIAL DEMOLITION NOTICE SERVED BEFORE COMPLETION
    (1) This section applies where—

    (a) an initial demolition notice is served on a secure tenant under Schedule 5A, and

    (b) the notice is served on the tenant before the landlord has made to him such a grant as is required by section 138(1) in respect of a claim by the tenant to exercise the right to buy.

    (2) In such a case the landlord is not bound to comply with section 138(1), in connection with any such claim by the tenant, so long as the initial demolition notice remains in force under Schedule 5A.
    (3) Section 138C provides a right to compensation in certain cases where this section applies.

    138B EFFECT OF FINAL DEMOLITION NOTICE SERVED BEFORE COMPLETION
    (1) This section applies where—

    (a) a secure tenant has claimed to exercise the right to buy, but

    (b) before the landlord has made to the tenant such a grant as is required by section 138(1) in respect of the claim, a final demolition notice is served on the tenant under paragraph 13 of Schedule 5.

    (2) In such a case—

    (a) the tenant's claim ceases to be effective as from the time when the final demolition notice comes into force under that paragraph, and

    (b) section 138(1) accordingly does not apply to the landlord, in connection with the tenant's claim, at any time after the notice comes into force.

    (3) Section 138C provides a right to compensation in certain cases where this section applies.

    138C COMPENSATION WHERE DEMOLITION NOTICE SERVED
    (1) This section applies where—

    (a) a secure tenant has claimed to exercise the right to buy,

    (b) before the landlord has made to the tenant such a grant as is required by section 138(1) in respect of the claim, either an initial demolition notice is served on the tenant under Schedule 5A or a final demolition notice is served on him under paragraph 13 of Schedule 5, and

    (c) the tenant's claim is established before that notice comes into force under Schedule 5A or paragraph 13 of Schedule 5 (as the case may be).

    (2) If, within the period of three months beginning with the date when the notice comes into force ("the operative date"), the tenant serves on the landlord a written notice claiming an amount of compensation under subsection (3), the landlord shall pay that amount to the tenant.
    (3) Compensation under this subsection is compensation in respect of expenditure reasonably incurred by the tenant before the operative date in respect of legal and other fees, and other professional costs and expenses, payable in connection with the exercise by him of the right to buy.
    (4) A notice under subsection (2) must be accompanied by receipts or other documents showing that the tenant incurred the expenditure in question."
    (3) After Schedule 5 to the Act insert, as Schedule 5A, the Schedule set out in Schedule (New Schedule 5A to the Housing Act 1985: initial demolition notices) to this Act.
    (4) The amendments made by this section do not apply in any case where the tenant's notice under section 122 of the Act (notice claim to exercise right to buy) was served before the day on which this section comes into force."
    On Question, amendment agreed to.
    Clause 160, as amended, agreed to.
    Clause 161 agreed to.
    Clause 162 [Repayment of discount: periods and amounts applicable]:
    [Amendment No. 212ZA not moved.]
    Clause 162 agreed to.
    Clauses 163 and 164 agreed to.
    Clause 165 [Right of first refusal for landlord etc.]:
    Lord Hanningfield Lord Hanningfield moved Amendment No. 212AA:
    Page 114, line 22, leave out first "shall" and insert "may"
    The noble Lord said: The amendments in this grouping are all concerned with the idea of right of first refusal on behalf of a social housing provider either in
    1342
    relation to a local authority, an RSL or a housing trust. They are essentially probing in their nature and are designed to raise a number of concerns that we on these Benches have received in relation to this measure.
    I believe that the ODPM recently conducted a consultation exercise on the right of first refusal. Therefore, I am sure that the concerns that I shall raise today will be familiar to the Minister, given that they were expressed during the consultation.
    In short, we are not convinced that this proposal will address the Government's stated aim of increasing the amount of affordable housing provision. We believe that it would be a waste of resources to purchase units which did not meet the specific housing needs of the local authority or RSL in question.
    A fundamental problem is the lack of identified additional funding for buying back units; nor will the additional cost of the procedure be compensated by additional central government funding. The cost of buying back units at current market prices is not more efficient than developing new units. Social housing providers are especially concerned that resources will be expended in notifying other landlords to little or no benefit in terms of additional social housing.
    Local authorities will incur substantial costs in administering the scheme, especially given the heavily prescribed procedure. The estimate is that, in implementing this procedure, each local authority would have to employ three extra staff, not to mention the additional costs of accommodation and overheads.
    It is not clear that compensation for time lost due to dispute over valuation is built into the process. All the deadlines seem very tight, given the prescribed arrangements and the lack of recognition of delaying factors. There is nothing to stop a landlord who does not accept purchase failing to notify a further appropriate body. A landlord has not only to notify a further authority but to establish that a nomination would be accepted and then issue a notice within the period. In the case of a freeholder selling, it appears that further authorities that are notified have only two weeks in which to consider accepting purchase.
    This proposal will not affect current resales which are not covered by the covenant and it offers no prospect for increasing social housing at present. Perhaps a better way forward would be a voluntary scheme, with funding, which allowed the local authority to buy back units that were in short supply. Social housing providers do not wish to be forced into a scheme which would, essentially, expend resources on administration and create additional bureaucracy. I beg to move.
    Lord Rooker: Clauses 165, 174, 177 and 181 give local authorities, registered social landlords and housing action trusts which have sold properties at a discount, either under the right-to-buy scheme or through voluntary disposals, a right of first refusal. That means that the owner of a property sold by a social housing landlord who wishes to resell it within 10 years of the sale must first offer it back to the landlord or to another prescribed person.

    1343
    Having consulted on the proposed procedures and bodies to be prescribed, the Secretary of State will prescribe in regulations a time limit within which such offers must be accepted. If they are not accepted within that time limit, the owner will be free to resell on the open market. The property will be offered at market value. That will be the value agreed between the parties or, if for some reason they are unable to agree, that determined by the district valuer.
    The noble Lord's amendment would make it discretionary, rather than mandatory, for landlords to insert the right of first refusal covenant. While that may appear to be a reasonable proposition, it would have the effect of weakening the right of first refusal. If it is not made mandatory, the opportunity to buy back properties may be lost when circumstances and housing need change in a local area. Also, the effect of a landlord not including the right of first refusal covenant is to deprive other social landlords in the area of the chance of being nominated to buy back the property.
    The responses to the consultation showed overwhelming support from stakeholders for the principle of the right of first refusal. There is very little support for it to be made discretionary.
    Lord Hanningfield: Perhaps the Minister would give an indication of the burden on local authorities. It has been estimated that three additional staff may be needed.
    Lord Rooker: My initial view, as the noble Lord said, is that it sounds preposterous as it builds in red tape. I shall take advice on it before the next stage. I cannot see that it should be an onerous burden on well run housing authorities. It is something new; it is to the overall benefit of social housing; and we shall ensure that it is not clogged up with red tape.
    Lord Hanningfield: I thank the Minister for that reply. The Minister mentioned red tape and I am sure that the Committee is agreed that we want to minimise burdens on local authorities. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Rooker Lord Rooker moved Amendment No. 212AB:
    Page 115, leave out lines 45 and 46 and insert—
    "(11) The limitation imposed by a covenant within subsection (2) (whether the covenant is imposed in pursuance of subsection (1) or (8)) is a local land charge.
    (12) The Chief Land Registrar must enter in the register of title a restriction reflecting the limitation imposed by any such covenant.""
    The noble Lord said: Clause 165 requires owners who wish to resell their housing in 10 years of them having been brought under a right-to-buy scheme, first to offer them at market value to the former landlord or to another body prescribed by the Secretary of State. That is to allow other social landlords the chance to purchase the property where the former landlord has transferred his remaining interest in that property or
    1344
    connected properties to another body. The Secretary of State will be able to prescribe the time limits within which such offers should be accepted and the circumstances in which the right of first refusal will lapse. He will protect the interests of prospective sellers on which he has consulted.
    The aim of the right of first refusal is to provide a means whereby property that is sold under a right-to-buy scheme can revert to the social housing sector without imposing an undue burden on the prospective seller. The amendment is designed to ensure that the right of first refusal is not overlooked.
    The right of first refusal will be imposed in all cases where there is a right-to-buy sale, apart from in rural areas, which I shall deal with later. However, the position is different in respect of voluntary disposals. Those can take place only with consent. General consents have been issued by the Secretary of State in relation to disposals by local authorities and indeed by the Housing Corporation in relation to disposals by social landlords, but not by the Secretary of State in relation to housing action trusts because voluntary disposals are very rare in that context.
    Generally, it is the case that voluntary disposals should not be on terms that are more generous than right to buy, as that could enable evasion of the right-to-buy scheme. I should also stress that we do not intend that general consents will allow for the exclusion of right of first refusal. As a matter of practice, the right of first refusal will be included in the vast majority of voluntary disposals.
    In national parks and in other designated rural areas, it is intended that general consents will allow landlords to choose between a right of first refusal and a restriction requiring sales to be made only to local people. That is intended to preserve existing choice, where restriction is more appropriate for landlords in rural areas. That will not, of course, be the case with housing action trusts which operated only in urban areas.
    The purpose of the amendment is to ensure the enforceability of a right of first refusal covenant, where one is imposed, by changing the enforcement provisions so that they are in line with the provisions of the Land Registration Act 2002. I beg to move.
    On Question, amendment agreed to.
    Clause 165, as amended, agreed to.
    1.15 p.m.
    Lord Hanningfield Lord Hanningfield moved Amendment No. 212ABA:
    After Clause 165, insert the following new clause—

    MARKETING PLAN FOR RIGHT TO BUY SALES
    (1) To monitor sales resulting from right to buy, local authorities will be required to formulate and publish publicly a yearly marketing plan for right to buy sales.
    (2) The marketing plan will include—

    (a) figures on the number of properties sold through the right to buy scheme in the last 12 months,

    1345

    (b) a target figure for the number of properties to be sold through the right to buy scheme in the coming 12 months, and

    (c) plans for how to achieve the target figure under paragraph (b)."

    The noble Lord said: Amendment No. 212ABA would introduce a marketing plan for local authorities in regard to the number of right to buy sales within their area. The clause was discussed at some length in the other place. However, by putting it before this Committee, I hope that the Government will have had a change of heart and will look more favourably on its merits.
    Consistent with the spirit and intention of the original right-to-buy legislation, it is important that we simultaneously put proper demands on local authorities that may not be carrying out their proper obligations in respect of the right to buy as enthusiastically as they might. It is clear from a study of local authorities across the country that some drive the right to buy with enthusiasm while others are reticent in encouraging people to take it up. That can involve the speed with which they deal with inquiries, how they market their local policy and how they value their properties.
    The plan would include targets on the number of properties that the authority planned to sell and how many it had sold, as well as how it would achieve that target. That seems to me a sensible, constructive and measured way to encourage local authorities to think creatively about how to deal with the right to buy. Few local authorities would think that it could not be taken on board at small cost. It would not be a massive exercise because good local authorities are doing much of that work already. I beg to move.
    Lord Rooker: This is a request for more red tape and burdens on local authorities. It is also worth pointing out that the way in which the amendment is drafted excludes more than 800,000 housing association tenants who have the right to buy following stock transfer from local authorities. If it is thought that there should be marketing for the rest of the local authority tenants, I do not see why those 800,000 are missed out.
    On the other hand, we do not agree with it anyway. By its nature, the right-to-buy scheme is demand led. Tenants have a legal right. Notwithstanding what was said earlier, the Labour Party may have come late, but it was 1986 when we changed our policy on that. The snag is that we forgot to tell anyone at the ensuing general election. I know that because I was the shadow housing spokesman.
    In 1999–2000 and 2000–01, more than 90,000 tenants applied for the right to buy and were accepted. In 2001–02 the number rose to 102,000; in 2002–03 it was more than 149,000; and the figure fell back to 110,000 in 2003–04. The number of completed sales has increased from about 40,000 a year some seven years ago to between 52,000 and 54,000 in the next
    1346
    three years, 63,000 in 2002–03 and almost 70,000 in 2003–04. Given those facts, it is somewhat surprising that the right to buy scheme needs to be marketed.
    Lord Hanningfield: We were not suggesting that local authorities should have a marketing plan. As the Minister knows, I am the last person to suggest further red tape for local authorities. It would have to be done without much of that. I have heard the Minister's answer and I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 166 [Information to help tenants decide whether to exercise right to buy etc.]:
    Lord Hanningfield Lord Hanningfield moved Amendment No. 212AC:
    Page 117, line 35, at end insert "including an initial one-off delivery of it to all existing secure tenants"
    The noble Lord said: While, on the whole, we can lend our support to Clause 166 which deals with the provision of information to tenants, Amendments Nos. 212AC and 212AD are simply designed to aid and to clarify the process a little further.
    As the Bill presently stands, it is up to the Secretary of State to decide when information regarding right to buy should be provided to tenants. It appears to be a degree of centralisation that is one step too far. Surely, it should at least be left to the relevant local authority in question. Additionally, it would appear sensible that a tenant, on completion of a tenancy agreement, be provided with such information as is the intent of Amendment No. 212AD. Furthermore, Amendment No. 212AC would ensure that there is a one-off delivery of such information to existing tenants. That would appear to be a sensible and rational way forward and one that I would hope that the Minister could support. I beg to move.
    Lord Rooker: Clause 166 supplements the existing duty placed on landlords by Section 104 of the Housing Act 1985 to provide information about the terms of their secure tenancies and the landlords' repair obligations. It also replaces the duty to provide information in respect of right to buy. Clause 166 requires landlords also to supply information to tenants on the responsibilities and consequences of being a home owner. The aim is to help them to decide whether to exercise their right to buy. The Secretary of State and the National Assembly for Wales have consulted separately on what information should be provided, and when. The vast majority of respondents supported the proposals.
    In consulting stakeholders, we stated that we envisaged, as soon as reasonably practical after Clause 166 comes into effect, getting landlords to provide the specified information to all new secure tenants as soon as they take up the tenancy and once every five years thereafter, or after any substantial changes are made to the right to buy scheme, the home buying and selling process, or the regime for service charges payable by leaseholders.

    1347
    We are currently considering our response to the consultation paper. Our proposals are very similar to those in the amendment tabled by the noble Lord, and therefore I ask him to await our final decision. I cannot say whether that will be on Report, as I do not have advice on that.
    Lord Hanningfield: I thank the Minister for that answer. As I said, we support the principle behind the Government's initial move—we were merely trying to improve its presentation. I note from what he said that consultation is still going on, and it may be that our amendment is what ultimately ends up in the legislation, so we will wait for further news. I beg to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 212AD not moved.]
    Clause 166 agreed to.
    On Question, Whether Clause 167 shall stand part of the Bill?
    Baroness Hamwee: I have an extensive note. It says: "Why?". The clause deletes provisions on rent-to-mortgage. The matter was barely touched on in the Commons. I believe the scheme has not been terribly widely used, but that in itself is no reason to bring it to an end. We seek simply to ask the Government to justify on the record the inclusion of this clause—in other words, the termination of the scheme.
    Lord Rooker: The amendment would remove Clause 167, which itself terminates the little-used rent-to-mortgage scheme from the Bill. Rent-to-mortgage enables tenants to buy a share in their houses if they cannot afford to buy them outright under the right to buy. The effect would be to leave on the statute book a scheme that has seen very little take-up since it was launched 10 years ago—and is expensive to administer—as well as thwarting the Government's policy of streamlining the number of low-cost home ownership schemes, a key recommendation of the Home Ownership Task Force. That is the answer to the question, "Why?".
    Clause 167 agreed to.
    Clauses 172 and 173 agreed to.
    Clause 174 [Local authority's right of first refusal]:
    [Amendment No. 212AE not moved.]
    Lord Rooker Lord Rooker moved Amendment No. 212AF:
    Page 125, leave out lines 10 and 11 and insert—
    "(10) The limitation imposed by a covenant within subsection (3) is a local land charge.
    (11) The Chief Land Registrar must enter in the register of title a restriction reflecting the limitation imposed by any such covenant."
    On Question, amendment agreed to.
    Clause 174, as amended, agreed to.
    Clauses 175 and 176 agreed to.
    Clause 177 [Registered social landlord's right of first refusal]:
    [Amendment No. A212AG not moved.]
    Lord Rooker Lord Rooker moved Amendment No. 212AH:
    Page 130, leave out lines 18 and 19 and insert—
    "(9) The limitation imposed by a covenant within subsection (2) is a local land charge.
    (9A) The Chief Land Registrar must enter in the register of title a restriction reflecting the limitation imposed by any such covenant."
    On Question, amendment agreed to.
    Clause 177, as amended, agreed to.
    Clauses 178 to 180 agreed to.
    Clause 181 [Housing action trust's right of first refusal]:
    [Amendment No. 212AJ not moved.]
    Lord Rooker Lord Rooker moved Amendment No. 212AK:
    Page 135, leave out lines 30 and 31 and insert—
    "(10) The limitation imposed by a covenant within subparagraph (3) is a local land charge.
    (11) The Chief Land Registrar must enter in the register of title a restriction reflecting the limitation imposed by any such covenant."
    On Question, amendment agreed to.
    Clause 181, as amended, agreed to.
    Clause 182 agreed to.
    Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 213:
    Before Clause 156, insert the following new clause—"
    "Assignments by way of exchange

    ASSIGNMENTS BY WAY OF EXCHANGE
    (1) Section 92 of the Housing Act 1985 (c. 68) (assignments by way of exchange) is amended as follows.
    (2) At the end of subsection (1) insert "or to the tenant of a fully mutual housing association where the conditions in subsection (1B) are satisfied".
    (3) After subsection (1A) insert—
    "(1B) The conditions to be satisfied with respect to an exchange with the tenant of a fully mutual housing association are—

    (a) that the landlord of the non-secure tenant is a fully mutual housing association registered with the Housing Corporation or Housing for Wales;

    (b) that the non-secure tenant intends to assign his tenancy to the secure tenant referred to in subsection (1) or to another secure tenant who satisfies the condition in subsection (2); and

    (c) that the secure tenant referred to in subsection (1) is or will become a member of the fully mutual housing association landlord.""

    The noble Lord said: I declare a general interest, in that I am consultant to the Co-operative Group. The inspiration for the amendment is CDS Co-operatives, a well established co-operative housing institution. There is a case to be made that the Minister and his colleagues in another place might well consider.
    The amendment concerns the outcome of operating the right to buy, and the rights of tenants to transfer. It gives secure tenants of local authorities the right to engage with co-operative tenants and preserves the right of co-ops to decide whether to give an equivalent right to exchange in their tenancy agreements. CDS Co-operatives considers this to be good practice, and their model tenancy agreement includes a right to exchange, subject to the incoming tenant being willing to accept the responsibility of being a member of the co-op—in other words, they accept that they share the democratic responsibilities for the decisions that affect the management of their homes. That is citizenship in action.
    For years after the Housing Act 1980 first introduced the statutory right to exchange, those arrangements worked well. Most local authorities permitted their secure tenants to carry out mutual exchanges with co-op tenants, even though their secure tenants did not have the statutory right to do so. However, since the Housing Act 1996 gave local authorities the power to use introductory tenancies, which many of them have done, many are saying they can no longer permit their secure tenants to exchange with co-op tenants because they do not have the statutory right to do so. My amendment seeks to give secure tenants that right. It seems harsh that a secure tenant in a local authority property who wishes to exchange amicably with a tenant in a housing co-operative is prohibited from doing so.
    I am led to believe that the ODPM will argue that co-ops often have specific criteria that enable people to gain access. If co-ops fell within the statutory mutual exchange scheme, they would only be able to sift people out on the grounds already laid out, which may not be wide enough to meet their needs. The ODPM's view is that co-ops would not want to lose that flexibility. CDS Co-operatives tells me that it does not accept that reasoning, as it does not agree that co-ops' flexibility is reduced. It also says that such reasoning,
    "ignores the fact that, for 16 years, co-ops permitted mutual exchanges to occur providing the incoming tenant agreed to become a member of the co-op".
    The ODPM seems to be arguing that to grant secure tenants the right to exchange with co-op tenants on the same basis that registered social landlords now do would breach the mutuality of the exchange arrangements in which both tenants have a right of exchange, the secure tenant's rights being statutory and the RSL-assured tenant's right being a contractual one in the tenancy agreement.
    It is a general point, and I am not pleading that there are many people in such a situation, but it seems to me that the Government have an opportunity to put right an aspect of the existing arrangements that is causing difficulties in the already problematic area of tenancy rights. I know the people who run CDS Co-operatives. The chief officer, David Rodgers, who has been a friend of mine for years, speaks to me about these matters and has said that the amendment would ease the situation in many ways. I hope that the Minister can say something helpful.
    1.30 p.m.
    I will not press the amendment today, but the Minister may wish to put on the record the department's thinking on the issue and to give us some hope that the problem is understood and there may be another way out. It is a simple, additional right that needs to be written into law. I beg to move.
    Lord Rooker: The amendment would diminish some rights also. We can appreciate that some tenants of fully mutual housing associations might well be prepared to give up the attraction of being a member of a cooperative for the benefits of a secure tenancy, but I doubt very much whether secure tenants would be prepared to enter into such an exchange, if it meant relinquishing their security of tenure and the possibility of right to buy. We do not think that the amendment is necessary. It seems reasonable to allow secure tenants of local authorities to exchange with assured tenants of housing associations because the tenancy rights are similar, but it does not make sense to provide a corresponding statutory right for secure tenants to exchange with tenants of a fully mutual housing association, where there is a big disparity between the tenants.
    There is another point, which I do not present as a major problem—I think that I have it right. The amendment would also mean that tenants of co-operative housing associations, who might well be perfectly housed, would be enabled to jump the queue and gain allocation of a secure tenancy, in front of others who might be in much greater housing need or who have waited considerably longer.
    We are not sure whether the proposal is in the best interests of housing co-operatives, since it would encourage existing tenants to assign their tenancies to secure tenants who might not support the aims of the co-operative. Many years ago I was in a co-operative that freely agreed to split up. We may be able to come back to the matter on Report; we do not think that it is necessary, but we certainly could not accept the amendment as drafted by my noble friend.
    Lord Graham of Edmonton: I am grateful to the Minister. He is right to say that nothing is clear-cut. I would have thought that the individuals involved, if they are sensible and reasonable, would look at the kind of problems that the Minister has raised before entering the agreement. If they are willing partners in an agreement and an exchange, so be it. The Minister has highlighted some of the practical problems that may arise. He has left me to think and, if necessary, to consult, before coming back at a later stage. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 156 agreed to.
    Clauses 168 to 170 agreed to.
    Lord Rooker: My Lords, I beg to move that the House do now resume. In moving this Motion, perhaps I may suggest that Committee stage begin again not before 2.35 p.m.
    Moved accordingly, and, on Question, Motion agreed to.
    House resumed.

    Business Improvement Districts (England) Regulations 2004
    1.34 p.m.
    Lord Rooker Lord Rooker rose to move, That the draft regulations laid before the House on 7 September be approved [27th Report from the Joint Committee].
    The noble Lord said: My Lords, I commend to the House the Business Improvement Districts (England) Regulations 2004 under Section 150 of the Local Government and Housing Act 1989 and under Part 4 of the Local Government Act 2003, which we debated at considerable length last year—it is a really exciting Act.
    The sections and regulations provide for the setting up and operation of business improvement districts—or BIDS, as they are now widely known. Under the scheme, local authorities and businesses would be encouraged to work together for the benefit of their local community. Projects under the scheme could include a wide range of different measures for improving the places where people work and live. That might involve increasing security, cleanliness, improving public access and the street environment, or enhancing or promoting the town centre or business area in some other way. The improvements would be funded by a levy raised on the non-domestic ratepayers or a defined class of ratepayers in the area covered by the scheme.
    However, before any proposal goes ahead, the businesses concerned would have the opportunity to vote in a ballot. To go ahead, schemes must be supported by more than 50 per cent of the local businesses balloted, both in terms of total numbers and of rateable value. That double requirement protects the interests of both small and large businesses in the area. There has been widespread interest in the scheme and enthusiasm for the opportunities it offers. A lot of energy and commitment have gone into ensuring that the bids are a success.
    Pilots have been set up to develop proposals to the point of being ready to go to a ballot. The pilots are of different sizes and types, and in many different locations around the country. They have shown the great potential of the scheme to improve the local business environment. I would like to take the opportunity to thank the Association of Town Centre Management for establishing 22 pilot schemes across the country; the Circle Initiative, for piloting the concept in five areas of central London; and the partners in the other independent schemes who have
    1352
    taken forward ideas to transform their own areas, including those involved in the Kingston project, which may be one of the first to go to ballot.
    There have been concerns that the scheme has taken a long time to come into effect and that we are in danger of losing momentum. Although the level of enthusiasm and energy generated by the proposed scheme has been very encouraging, it would dissipate if the mechanism for putting it into effect were flawed and therefore we have taken time to consult fully on the proposals in the regulations to ensure that they are workable, practical and robust. Some issues have proved more complex than originally anticipated. Most pilot schemes have not yet reached the ballot stage and those that are ready will not have to wait much longer. I understand their frustration, but it is in the long-term interest to get it right.
    During the debates on the Local Government Act 2003, we discussed at length the issue of whether property owners as well as occupiers should be entitled to vote. I do not intend to revisit that issue here. There is nothing to prevent property owners making voluntary contributions, which we would encourage. We have also undertaken to conduct research into the role of property owners in business improvement districts, and we hope to have appointed a research body to take that forward by the end of next month.
    There have also been concerns about the level of information on the proposals provided at the ballot stage to those businesses entitled to vote. Anyone liable for a BID levy is entitled to receive a copy of the BID proposal and the proposed business plan, if they ask for a copy. There is a specific provision in the regulations for that. At the heart of the scheme is a partnership approach. We expect discussion and consultation among businesses in the area to take place at a very early stage in the development of the proposals, and that those discussions will continue over time, so the details should be familiar.
    If some businesses feel that there has been a material irregularity in the ballot, they can ask the Secretary of State to declare the ballot void or order a re-ballot. If businesses or the big proposers feel that the billing authority is acting unreasonably in vetoing the proposal, they can appeal against the veto. The appeal would take account of the billing authority's published policies and whether proper consultation took place before the proposal was put forward to the ballot.
    Overall the scheme offers an opportunity for business and local government to work together for improvements in their joint interests. Those benefits are additional to what either local government or local business can provide individually. The regulations are fair, clear and contain the right checks and balances while encouraging innovation and productive local partnerships. It is a big incentive for people to work together. I beg to move.
    Moved, That the draft regulations laid before the House on 7 September be approved [27th Report from the Joint Committee].—(Lord Rooker.)
    Baroness Hanham: My Lords, as the Minister said, we spent a considerable amount of time discussing this last year. We were not always entirely in agreement at the end of those discussions. I think we had hoped that by the time we reached this stage, everything would have been sorted out. However, I am sorry to say that we do not think that the regulations are drafted adequately.
    The current drafting leaves individual BID bodies the responsibility of setting up schemes to deal with, in any BID levy arrangements, inter alia new hereditaments, split or merged hereditaments, deletions from the rating list, exemptions and properties treated as part-domestic. Failure to deal with these matters properly in BID arrangements could make it impossible for billing authorities to collect BID levies, and it is likely to create a series of significant legal disputes. Will the Minister indicate what was the thinking that ignored these aspects?
    Our understanding is that the lack of specification of these issues within the regulations will also result in BID arrangements varying widely throughout the country. We understand the intent is to allow maximum flexibility for BIDS to operate in the most suitable way, but this will make it difficult for multiple property occupiers to respond to BID proposals, as each BID arrangement will be different. Further consideration ought to be given to the means by which BID levy can deal with other technical issues.
    The regulations do not prohibit any extension to the duration of the BID, any fundamental alteration to the scope of works or services, or any alteration to the identity of the service provider, without an alteration ballot. This seems unduly complicated, and the Minister might like to comment on it.
    The BIDs guidance correctly highlights a number of advantages of incorporation for BIDs. Where incorporation is not adopted as the chosen legal status of the BID, then it will be essential to define clear financial accountability and reporting procedures in order to ensure and maintain partnership confidence in the financial soundness of the BID.
    BID proposers can include property owners. There is an anomaly here, in that owners who are not in occupation will not contribute to the BID levy other than in respect of vacant properties. Property owners may, therefore, attempt to use the role of BID proposers to enable them to improve the value of their properties without making any financial contribution. We touched on that when we debated this issue before.
    The question of ballot costs could be crucial to the initiation of BID projects. BID proposers will be expected to show evidence that they can cover the cost of a ballot, though if successful they will be entitled to recoup the cost of the ballot from the ratepayers. Though the legislation does not specify that BID proposers necessarily pay the costs of the ballot if unsuccessful, they are obliged to demonstrate sufficient funds for this eventuality. This will be a substantial requirement and it should act as a deterrent to unfeasible BID proposals. None the less, there remains some concern that such BID proposals could be promoted and therefore the
    1354
    additional penalty of a threshold of support for a BID below which proponents would be required to pay the costs of a ballot could be deemed appropriate by certain billing authorities.
    We understand that the Government will be monitoring the operation of BIDS, and it may be that they will give further consideration to requiring evidence of written support for BID proposals from local ratepayers before a billing authority is obliged to proceed with ballot arrangements. Can the Minister confirm whether this is indeed the case?
    The definition of persons entitled to fund the BID ballot is imprecise and unclear in the regulations. In the case of limited companies, there needs to be some definition as to those persons entitled to approve funding as ratepayers in a BID ballot.
    Finally, the availability of information ought to be closely monitored and policed by the relevant billing authority to ensure that information is used only for the purposes of establishing and voting on a BID project. We suggest that billing authorities should also be required to provide the rating list descriptions for properties that fall within the geographic area of the proposed BID. In many BID areas, it might not be the intention to charge every ratepayer but only certain categories of them—for example, retailers or office occupiers. These descriptions may be a helpful starting point in seeking to identify, relevant properties.
    I realise that we are at the regulation stage, but these seem to us areas of omission. If the Minister can respond to them, we can have the matter on the record before the regulations are introduced.
    1.45 p.m.
    Baroness Hamwee: My Lords, we on these Benches are enthusiasts for BID projects, and we wish them well. Thinking that I was not competent to judge the regulations, I arranged for some inquiries to be made of those who might have comments about them. I was able to find almost nothing by way of criticism or unhappiness. The Association of Town Centre Management says that it is happy, believes that the regulations are robust, and that this is due to the "extensive stakeholder consultation" which has been undertaken. I am delighted to be able to say that, because it is useful to know that at least so far—fingers crossed—that seems to have worked.
    I have one minor point—a query about whether businesses will be able to see how the BIDs levy is used by the local authority in its ring-fenced accounts. As I say that, I realise that the question more or less answers itself, but if the Minister has anything more to say, I would be grateful to hear it.
    We should remember that as these things are being developed, local residents need to be part of the consultation process. Not every area is exclusively commercial; even though they may not be part of the voting and the levy process, they will clearly have views about what is happening in their area. But, as I say, we wish the BIDs well.
    Lord Rooker: My Lords, I was very tempted to thank the noble Baroness, Lady Hamwee, for basically answering the questions of the noble Baroness, Lady Hanham. I considered that what the noble Baroness, Lady Hamwee, said answered virtually all the questions that the noble Baroness, Lady Hanham, asked, and I was not going to detain the House, because it seemed repetitious. In other words, they have the flags out in some of the towns in this country because BIDs are on the way.
    There has been full consultation. There has to be proper guidance and full information so that people know what they are voting for and the cost. The fact is, there are 22 pilots around the country. I am reluctant to spend the time of the House reading out where the pilots are—it is all a matter of public record.
    Much of the business community was opposed to the idea of the 20 per cent threshold, thinking that it could lead to problems. We have responded to those concerns by removing the requirement to show the 20 per cent before going to the ballot. Instead, we have introduced the power in the regulations enabling local authorities to require BID proposers to pay for the cost of a ballot if less than 20 per cent of eligible ratepayers vote for the proposal.
    The regulations require the Secretary of State to be notified in writing if a BID proposer intends asking the relevant BID authority to put the BID proposal to a ballot. This should enable a minimum level of information about potential projects to be gathered.
    One of the issues that was raised was who gets the ballot paper. With regard to a particular local address in a local authority, the variety around the country for small firms, particularly the national ones, is amazing. They all have their own arrangements. It is important that the right person gets the ballot paper, and that the person who gets the ballot paper understands what the BID is, even if it is 200 and 300 miles away near the head office where the rate bill is sent. All those factors can be taken into account in putting the register together.
    Split hereditaments should be dealt with by the BID proposer in the BID proposals. We will provide extensive guidance on the development of a BID proposal. Defining all the different terms mentioned would have involved extensive, complicated regulations and removed the flexibility. The point is that the BIDs will be different. All the areas in England are different. Bedford is different from Blackpool; Hull is different from Ealing; and Liverpool is different from Plymouth. Peterborough and Newquay are different, Manchester is not the same as Reading, and Swansea is not the same as Woolwich. All those are involved in pilot schemes. The last thing they want is for us to assume that they will all be the same. If they are all the same, we have failed. Perhaps a by-product of a successful BID would be that all the high streets stopped looking the same.
    On Question, Motion agreed to.

    Student Fees (Approved Plans) (England) Regulations 2004
    1.50 p.m.
    The Parliamentary Under-Secretary of State, Department for Education and Skills (Lord Filkin)The Parliamentary Under-Secretary of State, Department for Education and Skills (Lord Filkin) rose to move, That the draft regulations laid before the House on 7 September be approved [27th Report from the Joint Committee].
    The noble Lord said: My Lords, the regulations concern the role of the Director of Fair Access to Higher Education and access plans. Perhaps I may say a few words about how the director's role fits into the overall package of reforms contained in the Higher Education Act 2004. As the House knows, the Act introduced variable tuition fees from 2006 and will provide significant additional funding to institutions.
    However, higher education institutions can charge higher fees only if they have first agreed an access plan with the Director of Fair Access. The Government are also providing significant resources to improve access to higher education. We are abolishing up-front fees and the deferred fees will be payable only when graduates are earning £15,000, with any outstanding loan being written off after 25 years. Institutions no longer need to collect money directly from students. The Government pay the charge up front and graduates pay over time to the Government. We are greatly improving the student support package through new higher education grants of up to £2,700 from 2006.
    The freedom for universities to charge higher fees was a something-for-something arrangement; in other words, universities are to take responsibility for managing the potential consequences. Universities can charge higher fees only if they have considered and set out in an access plan the measures that they will be taking to safeguard access. Those plans will show how institutions will recycle some of their additional resources so that the needs of the poorest and most under-represented groups of potential students are not forgotten if fees increase. In practice, we expect that that will mean that universities promise more bursaries for the poorest students and more outreach work, both of which should bring greater benefits.
    The Director of Fair Access will safeguard access to higher education when higher fees are introduced in 2006 through the approval and enforcement of the institution's access plans. OFFA will be a small organisation that is initially based within the Higher Education Funding Council for England (HEFCE) in Bristol, drawing on HEFCE's staff, expertise and resources. The director will be independent of government and free to do as he sees fit, subject to the Higher Education Act 2004 and the regulations. The Secretary of State's draft guidance states that the director should be well focused and non-bureaucratic in his approach.
    I shall briefly mention changes that were agreed in the Lords. In doing so, I pay tribute to my noble friend Lady Ashton of Upholland, whom I follow and who steered the Bill so ably through this House. I also acknowledge the significant contribution made by this

    1357
    House in shaping the policy, especially the role of the Director of Fair Access. The Higher Education Act is better due to this House's scrutiny. I shall give noble Lords the rubric of that. For example, the director cannot interfere with institutions' admissions criteria or academic freedom, for which I acknowledge my noble friend Lady Warwick and the noble Lord, Lord Dearing. The director has a power to identify and disseminate good practice on access—the noble Baroness, Lady Perry. The director's remit may extend to part-time students—the noble Baroness, Lady Sharp. An institution cannot be sanctioned if it has taken all reasonable steps to comply with its plans—the noble Lord, Lord Butler.
    The Government accepted the amendment of the noble Lord, Lord Forsyth, on gap years, which provided that students who defer entry from 2005–06 to 2006–07 will not be charged fees above the standard fixed fee. The affirmative procedure for content, approval and financial penalties came from my noble friend Lady Warwick, although the Government are going further than that and the regulations before us today are being discussed as a single set. The contributions of those noble Lords show that the House of Lords is not merely a process that we have to get through, but that it adds value to our legislation and policy. I will probably be sacked for saying that, but never mind.
    The regulations set out the content of plans; the procedure for approval, variation and publication; and how the director may enforce the plans. They also outline a review procedure which can be followed if an institution disagrees with a provisional decision by the director.
    On the content of plans, the regulations largely reflect the wording of examples in the Act. The purpose of access plans is to ensure that access is safeguarded, so it is only right that they should include the measures that the institution plans to take to attract more applicants from under-represented groups; the bursaries and other financial assistance that the institution will offer to students; and the financial information for them. There is a new addition to the regulations that will not be so familiar to the House. It will ensure that institutions inform prospective students of the aggregate fees that it will charge before they commit to a course.
    On the approval of plans, the key to the approval process is, hopefully, a grown-up dialogue between the director and an institution. Once approved, plans must be published and a plan can last for up to five years. Plans can be varied once approved with the approval of the director.
    On enforcement, I would not expect there to be a major need for enforcement action because we are talking about grown-up organisations, but the sanctions decrease the likelihood that one will need to take enforcement actions in any event. We expect institutions to uphold their access plans and dialogue will be an important feature. The director must consider representations from the institution before imposing a sanction. The sanctions are to direct HEFCE or the TTA
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    to impose financial requirements or to refuse to approve a new plan when the current plan expires. Where they need to be imposed, the financial penalties fall into two categories: the first can be restored to the institution once it has made good any breach and is equivalent to 110 per cent of the breach; the other is not restored, but has a ceiling of £500,000.
    The regulations put flesh on the hones of the review procedure, including the grounds for a review, if there is new evidence or evidence which the director wrongly disregarded or if he had acted disproportionately.
    These are important regulations which will give certainty to institutions as they begin to prepare their access plans. I beg to move.
    Moved, That the draft regulations laid before the House on 7 September be approved [27th Report from the Joint Committee].—(Lord Filkin.)
    Baroness Seccombe: My Lords, I thank the Minister for outlining the details of the regulations. With the summer Recess behind us, it seems a while since we gathered to debate higher education issues. However, the concerns and objections that we expressed at the time of the Bill have not diminished. With your Lordships' forbearance, I shall briefly highlight them again.
    I echo the Minister in commending the Members of your Lordships' House who worked so hard to improve the Bill. As a result, we were especially pleased with the inclusion of the all-important stronger protection for academic freedom; provisions for gap year students; and the improvement to the appeals system against OFFA decisions.
    As many of your Lordships know, we on these Benches believe that there is a much better way to raise funds for universities without forcing them to do a deal. Under the Government's scheme, universities would benefit financially only if they let the Director of Fair Access have what has been described as "unwarranted interference" in bodies that should be independent institutions.
    That is another sorry example of an attempt by the Government to interfere in a way that they should not. One can only believe that there is a form of social engineering behind the lack of independence of the regulator from the Government. Why do our universities need to be burdened with the added expense of time and money in order to adhere to a Director of Fair Access, with all the paraphernalia of regulation and bureaucracy of the office, only to try to achieve something that is already happening?
    Our universities are already doing good work to widen participation. Outreach programmes and summer schools are but two of the common tools already in use to achieve that end. The point that regularly reared its head during the debates on the Bill was that the root of the problem of encouraging wider participation lies in schools and not in the universities, despite it being the universities which will be penalised if they do not carry out government wishes.

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    I turn briefly to the detail of the regulations. We have always been concerned about the fines that the Director of Fair Access will have the power to impose under Regulation 10. We were informed during the passage of the Bill that if universities did not comply with the regulator they would be liable to fines of £500,000, so we knew what was coming. However, earlier this week, my right honourable friend in another place highlighted the point that although we were forewarned about the £500,000 fines, we were not warned about the provisions under paragraphs (a) and (b) of Regulation 10, thus losing the opportunity to discuss them during the passage of the Bill.
    Those bombshell paragraphs allow for an additional 10 per cent on top of the fees charged when a university does not meet the Government's requirements. This additional 10 per cent could be a substantial amount of money. This is an extension of the financial penalties available to the director that we consider to be unwarranted. Surely, in this case the fees alone should be penalty enough on institutions that are struggling financially to be able to carry out their work. Can the Minister explain this significant addition to the House and can he also explain why it was not brought up whilst the Bill was in Committee?
    2 p.m.
    Bursaries are mentioned in Regulation 3. On Monday there was debate in the other place about the compulsion implied by the use of the word "must" in relation to the provision of bursaries by institutions that decide not to charge the full £3,000 fees and thus do not have to provide £300 bursaries. Taking it as it reads, Regulation 3 suggests that every institution has an obligation to provide a bursary, even if it is not charging a fee above the current level and even if it is not charging a fee at all. The Minister in the other place said in response to that debate that he would seek further clarification. I hope that the Minister can provide that here today.
    What will happen to those universities that charge only a couple of hundred pounds over the minimum fee? Will there be an obligation to provide a bursary from this amount? If so, could there not be a cut in the revenue from fees, again removing money from the pot? We must not forget that during the passage of the Bill it was highlighted that it would cost £1.1 billion to implement, while raising only £900 million. Looking at the details of these regulations and, I expect, others in relation to this Act, it looks as though what money is raised will be spread more and more thinly.
    Although improved by your Lordships, there was only so much that could be done to the Bill. These regulations are part and parcel of an unwelcome change that undermines the independence of our universities, while imposing extra costs in time, as well as a bureaucracy, on the very people who are trying against all the odds to educate our young people. It is a sad day for students and parents but as a general
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    election approaches voters will become more aware of the issues and will then have their say on the funding of higher education.
    Lord Shutt of Greetland: My Lords, I rise to thank the noble Lord for presenting these regulations and to congratulate him on mastering so quickly the brief that has fallen to him.
    I too was musing that it does not seem long since we were discussing this and I too have abiding memories of our discussions. One is the incredible unity of the university glitterati. A second memory—and it was mentioned in the thanks that the noble Lord, Lord Filkin, gave those who had contributed to the Bill—is the concern of my noble friend Lady Sharp and throughout the House about people undertaking degrees on a part-time basis. That is the point to which I refer.
    We are very much in favour of widening access for all the reasons that I spoke about at the time when we were debating the Bill. I believe that there will be an incredible potential growth in part-time work. Therefore, it is surprising that there is no reference to part-time education in the regulations. It is in the Higher Education Act, at Section 32(1):
    "The Director must perform his functions under this Part in such a way as to promote and safeguard fair access to higher education, (including part-time higher education in so far as his functions are exercisable in relation to it)".
    But I see no reference in these regulations to part-time education. It would be useful if, in promoting their plans and their response to it, proper accord is given to the business of part-time work. It will be increasingly important.
    As the Minister will be aware, this is an Act over which we did not always see eye to eye. But all that is under the bridge. This is what we have and we have to work with it. Therefore, although we did not think that OFFA was needed and that HEFCE could cope with it, we have OFFA and it is very important that there are regulations for setting it up. Therefore, we support that.
    Baroness Carnegy of Lour: My Lords, the Bill was enormously mangled in the House of Commons in order to get it through. The Government had great problems getting it through before it ever came to this House. We did our best and made some improvements but it was not easy to see that the Bill was going to be workable.
    This regulation takes my breath away. It is completely extraordinary to think that we have reached the point—and we have apparently reached it, with the Liberal Democrat Front Bench happily accepting it—where universities are simply not autonomous any more. Our most distinguished universities are going to be subject to these regulations. Some of our universities, which used to work under the government of local authorities, find this kind of regulation very much easier but our old universities, long-standing and distinguished ones, are going to be subjected to detailed scrutiny by this regulator in certain respects that I find completely extraordinary. They will do it on penalty of this enormous fine of

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    £500,000, as my noble friend said. I would like to read out one or two parts of the regulation because the way that universities are being treated would be laughable if it was not so tragic.
    I have been on the governing bodies of three universities and I can imagine how they are going to have to react to this. It will be very time-consuming and they will have to bend their arrangements to the Government's will to an extent that I never thought would be possible. I am really surprised. I do not think that we should say that our universities are autonomous anymore. They simply are not. They are being pushed around by the Government in a very detailed way and will have a big fine if they do not do what the Government want. I am very disappointed to see this regulation. We have to pass it and we will see what happens. It is very disappointing indeed.
    Lord Filkin: My Lords, in rising to respond to and thank noble Lords who have taken part in the discussion of these regulations, I should not be drawn back into a primary legislation debate by the noble Baroness, Lady Seccombe, which was almost her invitation. However, I shall say that we are serious about trying to ensure that all people of whatever background have the opportunity for their talents to be fully exercised. That is part of what a civilised society is concerned about. If one instances the fact that one in four working class students with eight good GCSEs does not go to university, there are still issues in our society for us to address. They are issues that the vast majority of universities are concerned about, irrespective of Government and other political parties.
    I turn to the specific questions that the noble Baroness raised on the regulations, one of which was about why there were the two regulations. That is a question that I asked myself when I was preparing for the debate. First, the matter of 110 per cent is not new. The issue was in the draft regulations published in February 2004 and July 2004. In essence, it operates like this: if either intentionally or unintentionally a higher education institution charges and does not fulfil the obligations to which it has committed itself in its access plan and, as a consequence, benefits by an extra income of—for the sake of argument—£100,000, then there is the sanction of withdrawing £110,000 from the grant that will be paid to it in future. The 110 per cent is specified because, if only 100 per cent were withdrawn, things would simply be back where they started from, and there would be no incentive for the institution to restore the agreement that it had set out and proposed in its access plan. When institutions comply with the undertaking that they have offered in their access plan, as we expect that they shall, the 110 per cent is restored, so they end up not having lost a penny. That is essential, because I suspect that most of these issues will be ones of mistake rather than malice.
    It is important that there be an effective, quick and proportionate incentive for institutions to comply. Because that sanction is there, I believe that it will be very rarely needed, because it is clear that there is no net gain or benefit from—how shall one put it?— mucking about".
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    The second measure, relating to the sum of up to £500,000 is a further sanction that is even less likely to be needed. It is essentially saying that it is possible to envisage, for someone of a particularly suspicious mind, a set of circumstances in which an institution kept on trying it on and did not actually fulfil the undertaking. An institution might make a breach and be sanctioned 110 per cent, apply and get the 110 per cent back, and then constantly go round in that loop. That is extremely unlikely ever to occur, but there is a sanction of a permanent penalty rather than the temporary docking of grant that the 110 per cent achieves.
    The noble Baroness, Lady Seccombe, asked whether institutions would have to provide bursaries if they charged only a few hundred pounds over the standard fee. The answer is no, unless they have set it out in their access plan that they put forward to the director that they would provide bursaries. If in their proposal they do not say that they will provide bursaries and the access plan is agreed, there is clearly no obligation on them to provide bursaries. If, however, they said that they would provide bursaries in X or Y circumstances, and that was the plan agreed, they would be obliged to do so.
    I agree with the point made by the noble Lord, Lord Shutt, about part-time study. The relevance of part-time study to widening access has always, historically—going back 100 years or more—been massively important in our society. It will continue to be so. While the regulations do not need to use the words "part time", because they can encompass that idea, I agree with him that in putting forward access proposals, consideration of part-time opportunities is important.
    I was saddened to hear that the noble Baroness, Lady Carnegy of Lour, was so unhappy about the primary legislation and also, by implication, the regulations. I do not believe that they will take away universities' autonomy. Universities have the freedom to charge higher fees if they want to, not the obligation to do so. The intention is that they are incentivised by the process to consider how they can continue their excellent efforts, in many cases, to widen access. If they want to charge fees, there is a light-touch process for ensuring that they have given thought to doing so, and it must be as non-bureaucratic as possible.
    I hope that I have done as much as I can to answer to the questions raised.
    On Question, Motion agreed to.

    Regulatory Reform (Local Commissioner for Wales) Order 2004
    2.14 p.m.
    Baroness Farrington of Ribbleton Baroness Farrington of Ribbleton rose to move, That the draft regulatory reform order laid before the House on 24 June be approved [24th Report from the Regulatory Reform Committee].
    The noble Baroness said: My Lords, the order is brought forward under the Regulatory Reform Act 2001, by the Wales Office. There are three Welsh public sector ombudsmen: the Welsh Administration Ombudsman, the Health Service Commissioner for Wales and the Commission for Local Administration in Wales. The purpose of the order is to enable the same individual to be appointed to all three public sector ombudsman offices in Wales as an interim step to establishing, when parliamentary time allows, a unified office led by a single individual—a public services ombudsman for Wales.
    Your Lordships will know that the Commission for Local Administration in Wales is more commonly referred to as the Local Government Ombudsman or the Local Commissioner. What is not so well known is that the commission actually consists not only of the Local Commissioner but also, ex-officio, the Welsh Administration Ombudsman and the Parliamentary Commissioner for Administration. But it is only the Local Commissioner who is empowered to undertake investigations that fall within the jurisdiction of the commission. The effect of this is that the Local Commissioner and the Welsh Administration Ombudsman cannot be one and the same person, but that is precisely what needs to happen if the ombudsman offices are to be brought together.
    Therefore, the purpose of the order is to amend the Local Government Act 1974 to remove a restriction, the effect of which is to prevent the Welsh Administration Ombudsman, although a commissioner, from undertaking investigations as the Local Commissioner. Its practical effect would be to allow the two offices of Local Commissioner and Welsh Administration Ombudsman to be held simultaneously by the same person. Legislation already provides for the office of Welsh Administration Ombudsman and Health Service Commissioner for Wales to be held by the same person. The order would apply to Wales alone.
    There has been extensive consultation, both on the overall policy objective to unify public sector ombudsman services in Wales and on the proposal to enable a single individual to be appointed to all three offices now. There is unanimous support for both. The House will wish to note that the Select Committee on Delegated Powers and Regulatory Reform agreed that the Local Government Act imposed a burden by preventing the Welsh Administration Ombudsman from acting as local commissioner and should be removed by way of the proposed order; agreed that it would not remove any necessary protections or any rights or freedom which a person might reasonably expect to continue or exercise; and agreed that adequate consultation had taken place.
    However, the committee considered that a requirement in the Local Government Act, that the local commissioner is appointed only after consultation with the appropriate representative body, is a form of protection that should be retained. The committee is satisfied that the order before the House has been amended to provide that the person appointed as Welsh Administration Ombudsman can be the local
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    commissioner only if that appointment is made following consultation with the appropriate representative body—which, in this instance, will be the Welsh Local Government Association.
    The Regulatory Reform Committee in the House of Commons unanimously agreed that the order be approved. In conclusion, I thank members of the Select Committee on Delegated Powers and Regulatory Reform for the time they spent scrutinising the proposal and for recommending the proposal to the House.
    In commending the draft order to the House, I welcome the noble Lord, Lord Roberts of Llandudno, to the Front Bench to speak for the Liberal Democrats. To have one Lord Roberts is a benefit; to have two is more than one can hope for. I beg to move.
    Moved, That the draft regulatory reform order laid before the House on 24 June be approved [24th Report from the Regulatory Reform Committee].—(Baroness Farrington of Ribbleton.)
    Lord Roberts of Conwy: My Lords, I, too, welcome the noble Lord, Lord Roberts of Llandudno, to the Front Bench on the Liberal side of the House. I also thank the noble Baroness, Lady Farrington, for her presentation of the order.
    We fully appreciate the purpose behind the order, which is to enable the combination of the three ombudsman posts and the eventual establishment of a public services commissioner for Wales to cover the devolved areas of government. The proposal has been talked about since 1998, when it was first proposed to the Secretary of State by the National Assembly advisory group.
    There has, as the noble Baroness said, been extensive consultation on the order, as required by the Regulatory Reform Act 2001. The Regulatory Reform Committee in the other place and the similar committee in your Lordships' House have thoroughly examined the issues and the Government have accepted their recommendations regarding consultation with the National Assembly and local government.
    We assume that the Government are satisfied that the three posts can be combined to advantage and without loss of functional efficiency and effectiveness. I take it that the Government are of the view that a single commissioner can do the job properly and effectively; that it will not be too onerous or so burdensome that the work cannot be adequately performed. Of course we are aware that the Parliamentary Commissioner—the fourth commissioner, as it were—will remain to deal with complaints arising from the non-devolved areas of Government.
    Perhaps the Minister can give us a firm assurance on the point that the development will,
    "not remove any necessary protection or prevent any person from continuing to exercise any right or freedom",
    although those words are in the preamble to the order. I ask because the duties performed by the commissioners are of the utmost importance to individual citizens who have a complaint of

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    maladministration against central, regional or local government or health authorities, all of which are subject to examination by the commissioners.
    I have in the past read the commissioners' annual reports, which contain accounts of their investigations of individual complaints. They are always interesting and revealing. They often show the commissioners as the last resort of the citizen fighting to right a wrong he or she has suffered or believes he has suffered.
    The areas covered by the commissioners are varied and extensive, but they are brought together by the common denominator of maladministration, which is the commissioners' real concern. There is no reason in my view why the diversity of subjects covered should prevent a combination of offices because maladministration is the same whether it occurs in a department of state, the National Assembly, a local or a health authority. It has the same characteristic features in all spheres.
    The second assurance we seek is that there are positive advantages to be gained and that the combination is not simply a money-saving exercise. I am all in favour of saving taxpayers' money but not at the expense of taxpayers' rights.
    Finally, I note that we may expect some primary legislation relating to this proposal to come before us in the near future. Bearing in mind the extensive and laborious consultation required for an order under the 2001 Act and the pressure on parliamentary time, it is surprising that the Government have not rolled all this into one parliamentary Bill. One is bound to ask why we must have this preliminary order when it is to be followed by primary legislation.
    I believe the answer to some of the points lies in the present situation in Wales where the two offices of Health Service Commissioner and Welsh Administration Ombudsman are currently held by the same person, Mr Adam Peat, whom I had the pleasure of knowing as a very able, young civil servant when I was a Minister in the Welsh Office. It is intended that a third office—that of local commissioner—should be added to these two when the present incumbent of that office retires, which I believe is in the not too distant future. That combination then leaves the way open to create a single post of public services ombudsman for Wales and, as I have said, that will require primary legislation. I only hope that the Government will find time for it in due course.
    Lord Roberts of Llandudno: My Lords, I am grateful for the welcome from the two Front Benches. It is a delight to be able to speak—I am sure, on a temporary basis—from the Front Bench. The noble Lord, Lord Roberts of Conwy, and I, Lord Roberts of Llandudno, are living holiday brochures. The Welsh Tourist Board should recognise us in some way or another.
    As Liberal Democrats we welcome this reform. The co-ordination of services is useful and helpful. Already we know how effectively the complaints can be dealt with. I am told the latest local government report contained 183 allegations in Wales, of which 85 were accepted, and the health service had 180 complaints; so it is a worthwhile office.
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    When we have the united office, it will overcome confusion and overlapping. People have asked me, and I have myself asked, "Where do I complain? Who do I go to in order to redress this situation?". We hope that when the office of one public services commissioner is established the guidelines will be clear and easily available to all people who feel that they have some allegation or some complaint to make.
    I look forward very much to reading soon the first report of the new public services commissioner. As the noble Lord, Lord Roberts of Conwy, mentioned, we hope that that post will be established soon. Will the Minister tell us how soon that is likely to be?
    I have consulted Assembly Members in Wales and they, too, welcome this reform and hope that it will be in place soon. I join in supporting the reform proposed by the Government.
    Baroness Farrington of Ribbleton: Thank you, my Lords. I recognise the value to tourism in Wales for those of us who frequently visit Wales on holiday. It is not necessary, but I fear that not everyone fully appreciates the beauty of Wales—yet. Both noble Lords can help with that.
    The issues that have been raised are important. The noble Lord, Lord Roberts of Conwy, asked why we did not wait for the Bill. The offices fell vacant naturally last year, so we are taking advantage of an opportunity that has presented itself to take an interim self-contained step towards the longer-term policy objectives. A Bill will be presented as soon as parliamentary time is available.
    Noble Lords also asked about the benefits of the reform. It will allow progress to be made in implementing the wider proposals for a unified office. One person will be better placed to raise the profile of the office and make easier the resolution of complaints that straddle the jurisdiction of the different offices.
    There will be no impact on the right of individuals in this case. The time limit remains at 12 months from the time at which matters gave rise to complaint. The ombudsman already has discretion to extend that time limit. That goes for all three offices.
    The time commitment of such a commissioner is not an issue. There is no reason to doubt that the office holder will not have every opportunity to exercise properly his respective jurisdictions. He must prepare annually a report to lay before the Assembly for debate on the performance of each office.
    I do not think that any other queries were raised. I thank both noble Lords for their support. I have to say, declaring a former interest in my time deeply involved in local government in Wales, that the unanimity that this consultation has achieved is fairly rare. Individuals in Wales as elsewhere are perfectly able to raise objections if they wish. I am delighted that noble Lords are supporting the outcome of the consultation, which had such clear and unanimous support. I beg to move.
    On Question, Motion agreed to.
    Baroness Crawley: My Lords, I beg to move that the House do now adjourn during pleasure until 2.35 p.m.
    Moved accordingly, and, on Question, Motion agreed to.
    [The Sitting was suspended from 2.29 until 2.35 p.m.]

    Housing Bill
    House again in Committee.
    Clause 171 [Disclosure of information as to orders etc, in respect of anti-social behaviour]:
    Lord Rooker Lord Rooker moved Amendment No. 214:
    Page 122, line 11, leave out "138(2A)" and insert "138(2AA)"
    The noble Lord said: This is a minor and technical amendment to amend an incorrect reference to a subsection in Clause 171(4) of this Bill. I beg to move.
    On Question, amendment agreed to.
    Clause 171, as amended, agreed to.
    Clause 183 [Particulars of site agreements to be given in advance]:
    Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 215:
    Page 138, leave out lines 2 to 4 and insert—
    "() includes particulars of the land on which the proposed occupier is to be entitled to station the mobile home that are sufficient to identify—

    (i) the boundaries of the land on which the mobile home may be located, and

    (ii) the services provided on that land;"

    The noble Lord said: We come to a number of amendments that are all related to the welfare of park home owners. I declare an interest as the honorary secretary of the All-Party Parliamentary Group for the Welfare of Park Home Owners. I am delighted that the noble Baroness, Lady Maddock, is present as she often attends committee meetings at which park homes are discussed.
    The background is very interesting. For many, many years the organisations that represent park home owners have brought to the parliamentary committee a series of what one can only term distress signals regarding the hurt that has been visited upon their members by some site owners. Let me make it clear that the view I hold is shared by many; namely, that while there are a number of site owners who are unfair and unjust, and sometimes downright bad, many others are reasonable, sensible and dispense justice and interpret their regulations and rules in a fair manner.
    The Minister knows very well what has happened over the years. Ministers from the ODPM, including the noble and learned Lord, Lord Falconer of Thoroton, when he had responsibility for these matters, the noble Lord, Lord Rooker, and a series of Ministers in the Commons have all attended meetings and have tried to resolve the problems. When the Housing Bill was undergoing pre-legislative scrutiny evidence was given regarding why there ought to be a
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    complete revision of the law relating to park homes. I attended the relevant meeting with the honourable Member in another place, Mr Hilton Dawson, who is the chairman of the all-party group. We were given the good news that the case had been made and that the Government ought to bring in legislation perhaps within the next two years. Those involved with park homes have literally been overwhelmed by the speed with which the Government have responded to the case that has been made.
    In particular I wish to pay tribute to the Minister, Yvette Cooper, who attended two meetings in rapid succession and gave the clear impression that she understood what the problems were, and agreed, when the Bill went through the other place, to a series of amendments to it, all of which were beneficial to park home owners. I particularly want the Minister to note that the general attitude in the park home community is one of appreciation for the manner in which the Government—which of course goes from the Deputy Prime Minister right down to all of his Ministers—have taken that on board. I am advised that there is an excellent liaison between the civil servants who are responsible for monitoring these matters and for advising the Ministers. I have no complaint whatever. Inevitably, like Oliver Twist, I want some more.
    I ask the Minister if he could give the Committee, and those affected, the current thinking on two of the matters covered by the amendments. It is all borne out of experience. I remember the Minister last night pleading in aid on an issue a number of letters that backed up his case. He was very careful to say, of course, that Ministers receive the views of many people and these were just a few. The sad fact is that when I asked for comparable evidence of the case I want to make, there was general view that people were frightened and unwilling to put complaints of this kind in writing. It is a fact, in the park home world, that there are some situations in which elderly, frail and sometimes disabled people—who are glad to be living on the park—are very, very reluctant to complain and say things that could get back to the site owner. That is a fact of life. But I ask the House and the Minister to listen carefully to one of the burdens of the complaint, the arbitrary manner in which some site owners determine where the home should be, whether it should be moved and whether they have got the right to move.
    On the first of two main amendments I am speaking to, I ask the Minister if he would either incorporate our amendment or come back at a later stage, or even say that the matter is currently being dealt with in negotiations with park home owners. That relates to the actual boundary of the site. They want it to be specific, but they also want to dot the "i"s and cross the "t"s as to how communications are made. One of the amendments I am speaking to is that any communications on these matters should be referred to the parties not only by post, but by registered post.
    I turn to the question of what is called the five-year rule. It is a fact that the question of the five-year period is in the 1983 Act, and is very often used as a threat by some site owners against people who may not be

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    willing to go to court and to bludgeon timid park home owners into agreeing to things. We believe that this ought to be left in. In general, we believe that a park owner who effectively denies the resident the right to sell their home by using the conditions of the home, dissuading the buyer or other tactics, should be liable to severe penalties. It is not just a question of the five years, because the prospective purchaser may very well be influenced and disaffected in going forward with the purchase if it is seen that the site owner is unreasonable.
    I move the amendment with gratitude to the Minister and his ministerial colleagues, and in the firm belief that there is a case to be made. It may well be that the Minister will tell us that these are ongoing matters, but I provide the Minister with a chance to say some kind words. I beg to move.
    2.45 p.m.
    Baroness Miller of Chilthorne Domer: I speak to my Amendment No. 227 which is grouped with these amendments. Its purpose is to make sure that mobile home owners are dealt with in the same way as any other dweller of a house, be it a mobile home or house of bricks and mortar—indeed, if the amendment is agreed to, houseboat owners, would also be included. It is about renewable energy grants.
    Perhaps the Minister can explain to me why it is that the Government's "Clear Skies" renewable energy grants have certain eligibility criteria. They are, first, that the applicant must the owner of the property; secondly, that the applicant must be resident in the UK; and, thirdly, that the property must be located in the UK. However, the fourth states that the system must supply a building and not a mobile home, caravan or houseboat. The guidance for the grant states that those are not eligible. Mobile homes and houseboats are harder to insulate and make more energy efficient because the construction of a mobile home lends itself less well to that. To heat it, you are going to need to use carbon, just as in any other sort of property, such as a house of bricks and mortar. Being able to apply for a grant which enables you to use solar energy, wind energy or any of the others listed under Clear Skies grants is at least as important—perhaps it is more important—as it is for a house. But it is at least equally important. This amendment is intended to probe the Government's thinking about why they have excluded all of those classes of homeowners from being able to apply for these grants.
    Baroness Maddock: I support the amendment of my noble friend Lady Miller. I say to the Minister, although I am sure he realises this, that the Home Energy Conservation Act did, in fact, cover mobile homes. So, when people are trying to insulate their homes, that is certainly possible. It is unfortunate that we are not consistent about how we treat forms of homes other than bricks and mortar when we are looking at legislation. I welcome the amendments in this Bill for those who live in park homes, because for a long time I thought they should be cast as mainstream housing legislation. I have made that clear in speeches before, so I will not labour it today.
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    With the leave of the Committee, I realise that my amendment on mobile homes has been put in a very funny place on the Marshalled List. I thought it was because it was a new clause but when I read it again I realised that that had nothing to do with it. For some reason, it has got in the wrong place. I mention that because it is a related area.
    My Amendment No. 229C is about the "fit and proper person" status of those who run park home sites. This was discussed in another place, and at that time Yvette Cooper said that they were getting consultants' reports shortly after Easter. I agree with her that it is not something you can legislate on quickly. But given that this Bill has a very effective way of dealing with the licensing of landlords for houses of multiple occupation, it seems to me that it is not that difficult. I would like to know how far the Government have got.
    I end by saying that, with the noble Lord, Lord Graham, I have worked in this area for a number of years. If I might use somewhat unparliamentary language—the sort of language that the Minister sometimes uses—we have failed around on this for a number of years before actually getting to something satisfactory, and we are really very glad. One of the main problems is that the few sites that treat people appallingly are the problem. That is one of the key points missing from the very good amendments that the Government have brought forward on this issue.
    When I was a Member of another place—I represented Christchurch—my constituency had a huge number of people who lived in park homes, many of them elderly. They choose to live there because it is a safe environment and a small property to look after, and because they have friends there to look after them. That is one reason why I think the area important. I welcome what the Government are doing.
    Lord Rooker: If I may, I shall jump to Amendment No. 229C, to which the noble Baroness has just referred, before I come to the others.
    The Government accepted many of the recommendations of the park homes working party, including those relating to site licensing and in principle the licensing of site owners. However, the amendment proposed to implement those recommendations will not work in practice. We are currently drafting a consultation paper to carry out detailed consideration of all the site licensing recommendations, drawing comparisons with licensing regimes in the private rented sector. As part of this work we are considering whether a requirement that the licence holder be a fit and proper person is necessary and, if it is, whether the fit-and-proper-person criteria for a licence holder for a park home site should be the same as that for a house-in-multiple-occupation licensee. We are also considering what procedures would be necessary to ensure that new site owners met the criteria for being a fit and proper person on transfer of site licences. I hope that that brief response will satisfy the noble Baroness on Amendment No. 229C.

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    I shall now deal with Amendment No. 215 and the others to which my noble friend spoke. I have some good news. Clause 183 requires the owners of park home sites to provide a written statement setting out the terms and conditions of an agreement to occupy a pitch on a site to the occupier at least 28 days before that agreement commences. Amendment No. 215 seeks to tweak that provision by adding the specifics of the boundaries of the pitch and the services provided on the pitch. The aim is to reduce greatly the number of disputes.
    We considered the revised wording suggested to the original draft of the Bill. However, it was felt that there were difficulties that needed to be explored, and therefore it was thought necessary to consult relevant stakeholders. Those issues have now been resolved, and the topics are discussed in the consultation paper on implied terms and written statements that was published at the end of July. I therefore hope that my noble friend will not seek the need to pursue Amendment No. 215 today.
    Amendment No. 216 concerns the service of the written statement by post to occupiers. We are going to be haunted by postal voting and post, although I know that we are not talking about voting. I was waiting for postal voting to come up on the BIDs regulations; I had a note on them, but they did not come up so I did not use it. Section 7 of the Interpretation Act 1978 will apply in the circumstances, which means that the service will be deemed to be effected by properly addressing, prepaying and posting a letter containing the document. Prepaying means putting a stamp on it. One has to keep a straight face saying all that; it is difficult. Unless the contrary is proved, service will be deemed to have been effected at the time at which the letter would be delivered in the ordinary course of post. That leaves a hit to be debated, does it not? That is not an attack on the postal workers, by the way, but on their barmy management. I do not want to be misunderstood on that.
    The problem with requiring service by recorded delivery is that actual receipt is not until the letter can be delivered to someone prepared to take receipt and sign for it. It was felt that by using Section 7 of the Interpretation Act, the site owner can be confident when service is going to be deemed to have taken place, so that he can properly comply with the requirement to serve 28 days. Of course, it would be prudent for him to obtain proof of posting, but that need not be by recorded delivery. There is therefore an adequate way out of the problem.
    Amendment No. 217 seeks to extend the provision about removing age that is already in the clause, to remove the five-year relevant period which also forms part of the grounds for termination. The five-year rule effectively breaks the life of a mobile home up into five-year relevant periods. We agree with my noble friend that whether that is useful should be re-examined. Therefore, we proposed a choice of options concerning paragraph 6 in the consultation paper on implied terms and written statements that was published at the end of July. When we receive the results of the consultation, we will be in a
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    better position to decide whether the five-year rule should stay or go. I hope that my noble friend will take that as a useful response.
    Before I come to the government amendments in the group, I should deal with Amendment No. 227. It is quite nice the way people write my notes; it says here that the amendment has the noble intention to give residents of mobile homes the same access to energy grants as people in bricks-and-mortar housing. It is a proposal with which the Government agree wholeheartedly. However, the amendment is unnecessary as mobile home owners are already eligible for four types of energy grant—private sector renewal, disability facilities grants, Warm Front grants, and energy efficiency commitment. I agree with my officials; we have no idea so far as Clear Skies grants are concerned. I have never heard of them.
    Noble Lords: Oh!
    Lord Rooker: I am just giving the truth. The Committee on Standards in Public Life says that Ministers do not tell the truth. I have never heard of Clear Skies grants, and I will write to the noble Baroness on the matter well before Report.
    I want to speak briefly to government Amendments Nos. 218, 220, 221, 222 and 246, which remedy an error. Clause 220, which was formerly Clause 184(3)(1B), has now been placed in its own section, a separate part 3 in Schedule 1. They basically sound like technical amendments to the Bill.
    Lord Graham of Edmonton: I express my thanks and appreciation to the Minister. He tells us that the matters that I raise will form part of the consultation document. When Yvette Cooper came to see us, she saw great scope in examining the implied terms route for a great many things that were exercising people's minds. I am absolutely certain that those outside the House who have a responsibility for park home owners will advise the likes of the noble Baroness, Lady Maddock, and me on such matters.
    There is a sense of grievance among many park home owners that some of the rights enjoyed by other owners or tenants are denied them. However, the Minister has done a good job in taking this opportunity to bring the situation out in the open and up to date. I commend to him again the excellent relationship between his officials and those who represent park home owners. I am very grateful and I am sure that those outside the House will be, too. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 216 not moved.]
    Clause 183 agreed to.
    Clause 184 [Implied terms relating to termination of agreements or disposal of mobile homes]:
    [Amendment No. 217 not moved.]
    Lord Rooker Lord Rooker moved Amendment No. 218:
    Page 140 leave out lines 27 to 35.
    On Question, amendment agreed to.
    [Amendment No. 219 not moved.]
    Lord Rooker Lord Rooker moved Amendments Nos. 220 to 222:
    Page 141, line 32, at end insert—
    "(4A) After Part 2 of Schedule 1 to the Mobile Homes Act 1983 (c. 34) insert—

  PART 3

    SUPPLEMENTARY PROVISIONS
    Duty to forward requests under paragraph 8 or 9 of Part 1
    1 (1) This paragraph applies to—

    (a) a request by the occupier for the owner to approve a person for the purposes of paragraph 8(1) of Part 1 (see paragraph 8(1A)), or

    (b) a request by the occupier for the owner to approve a person for the purposes of paragraph 9(1) of Part 1 (see paragraph 8(1A) as applied by paragraph 9(2)).

    (2) If a person ("the recipient") receives such a request and he—

    (a) though not the owner, has an estate or interest in the protected site, and

    (b) believes that another person is the owner (and that the other person has not received such a request),

    the recipient owes a duty to the occupier to take such steps as are reasonable to secure that the other person receives the request within the period of 28 days beginning with the date on which the recipient receives it.
    (3) In paragraph 8(1C) of Part 1 of this Schedule (as it applies to any request within sub-paragraph (1) above) any reference to the owner receiving such a request includes a reference to his receiving it in accordance with sub-paragraph (2) above.
    Action for breach of duty under paragraph 1
    2 (1) A claim that a person has broken the duty under paragraph 1(2) above may be made the subject of civil proceedings in like manner as any other claim in tort for breach of statutory duty.
    (2) The right conferred by sub-paragraph (1) is in addition to any right to bring proceedings, in respect of a breach of any implied term having effect by virtue of paragraph 8 or 9 of Part 1 of this Schedule, against a person bound by that term.""
    Page 141, line 44, leave out "subsection (3) or (4)" and insert "subsections (3)(a), (4) and (4A)"
    Page 141, line 46, leave out "8 or (as the case may be) paragraph 9" and insert "8(1) or (as the case may be) 9(1) of that Part"
    On Question, amendments agreed to.
    Clause 184, as amended, agreed to.
    Clauses 185 and 186 agreed to.
    3 p.m.
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 222A:
    After Clause 186, insert the following new clause—

    TENANCY DEPOSIT SCHEMES
    (1) The appropriate national authority must make arrangements for securing that one or more tenancy deposit schemes are available for the purpose of safeguarding tenancy deposits paid in connection with shorthold tenancies.
    (2) For the purposes of this Chapter a "tenancy deposit scheme" is a scheme which—

    (a) is made for the purpose of safeguarding tenancy deposits paid in connection with shorthold tenancies and facilitating the resolution of disputes arising in connection with such deposits, and

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    (b) complies with the requirements of Schedule (Provisions relating to tenancy deposit schemes).

    (3) Arrangements under subsection (1) must be arrangements made with any body or person under which the body or person ("the scheme administrator") undertakes to establish and maintain a tenancy deposit scheme of a description specified in the arrangements.
    (4) The appropriate national authority may—

    (a) give financial assistance to the scheme administrator;

    (b) make payments to the scheme administrator (otherwise than as financial assistance) in pursuance of arrangements under subsection (1).

    (5) The appropriate national authority may, in such manner and on such terms as it thinks fit, guarantee the discharge of any financial obligation incurred by the scheme administrator in connection with arrangements under subsection (1).
    (6) Arrangements under subsection (1) must require the scheme administrator to give the appropriate national authority, in such manner and at such times as it may specify, such information and facilities for obtaining information as it may specify.
    (7) The appropriate national authority may make regulations conferring or imposing—

    (a) on scheme administrators, or

    (b) on scheme administrators of any description specified in the regulations,

    such powers or duties in connection with arrangements under subsection (1) as are so specified.
    (8) In this Chapter—
    "authorised", in relation to a tenancy deposit scheme, means that the scheme is in force in accordance with arrangements under subsection (1);
    "custodial scheme" and "insurance scheme" have the meaning given by paragraph 1(2) and (3) of Schedule (Provisions relating to tenancy deposit schemes);
    "shorthold tenancy" means an assured shorthold tenancy within the meaning of Chapter 2 of Part 1 of the Housing Act 1988 (c. 50);
    "tenancy deposit", in relation to a shorthold tenancy, means any money intended to be held (by the landlord or otherwise) as security for—

    (a) the performance of any obligations of the tenant, or

    (b) the discharge of any liability of his, arising under or in connection with the tenancy.

    (9) In this Chapter—

    (a) references to a landlord or landlords in relation to any shorthold tenancy or tenancies include references to a person or persons acting on his or their behalf in relation to the tenancy or tenancies, and

    (b) references to a tenancy deposit being held in accordance with a scheme include, in the case of a custodial scheme, references to an amount representing the deposit being held in accordance with the scheme."

    The noble Lord said: It gives me considerable pleasure to move the amendment. For many years, one of the things that I, as chair of a housing committee and leader of a council in an area where about a fifth of the local population lived in private rented accommodation, thought was most iniquitous was the deposits that tenants paid and their frequent failure to be able to recover them at the end of their tenancy. It was nothing short of a national scandal.
    The new clauses proposed by Amendments Nos. 222A, 222B, 222C, 222D and the new Schedule proposed in Amendment No. 230B provide for the introduction of tenancy deposit schemes. Such schemes should protect deposit moneys paid by tenants to

    1375
    landlords or their agents. Tenants pay deposits in good faith, expecting that they will be returned at the end of the tenancy provided the tenant leaves the property in much the same condition as they found it, subject of course to "wear and tear".
    Landlords value deposits as a guarantee that their tenants will meet these obligations and be committed to safeguarding their property. A deposit provides some cover against the costs of damage caused by tenants, whether deliberate or accidental.
    For the majority of tenancies, landlords repay deposits in good faith and without undue deductions. Most landlords are keen to foster good relationships with their tenants. If tenants treat their rented property appropriately, such landlords will, at the end of the tenancy, repay the deposits without a fuss. In most instances where a tenant has caused damage to the property or broken some other obligation, both parties should be able to agree amicably on the landlord retaining part of the deposit to cover repairs or other expenses and on returning the remainder to the tenant. However, government statistics have shown that, in a significant minority of cases of around 20 per cent, tenants who had a tenancy ending in the previous three years felt that their landlord had unreasonably retained all or part of their deposit. Unfortunately, there are some landlords who make it a practice of always withholding their tenants' deposits.
    A consequence of the actions of this minority of bad landlords is that they stigmatise the whole of the private rented sector, with all landlords being regarded as money-grabbing shady characters waiting to rip off innocent tenants. As a result, many decent landlords find that their tenants default on their last month's rent in the expectation that their deposit will not be returned to them. I am afraid that, although the majority of landlords may consider that they are doing the right thing, the high turnover in the private rented sector—over 40 per cent per annum—means that a large proportion of tenants can easily experience bad practice.
    The better landlords and agents see a need to tackle the abuse of tenancy deposits. They participated in the pilot voluntary tenancy deposit scheme that was set up by the Government and run by the Independent Housing Ombudsman from March 2002 to March 2004. In May this year, the Association of Residential Letting Agents (ARLA) set up an independent tenancy deposit scheme for its members, based on the pilot.
    The take-up for the pilot tenancy deposit scheme was disappointingly low, indicating the need for legislation to ensure complete coverage of all deposits taken in the private rented sector. The problems faced by tenants in getting their deposits back have been highlighted by organisations such as Shelter and the National Association of Citizens Advice Bureaux, and in the responses which we received to our consultation paper Tenancy Money: Probity and Protection, which we issued in November 2002.
    In that consultation, we looked at a range of options for safeguarding deposits, both legislative and non-legislative. We considered purely voluntary schemes
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    set up and run by industry. Such schemes would be likely to be non-custodial and would need some insurance cover to provide an assurance that they could meet their liabilities if the landlord or agent defaulted. The landlord or agent would retain the deposit and any failure on their part to repay it to the tenant would be covered by the scheme's reserves and insurance guarantees.
    That option was the one that was most favoured by landlords and agents. However, we concluded on the low take-up of the pilot that such schemes would be likely to attract only the decent landlords or agents who already engaged in good practice and not the rogue element that we are seeking to capture.
    We also considered establishing a single government-sponsored custodial scheme, where landlords and agents would transfer deposits into a specified account operated by the scheme. This option was most favoured by tenants and their representative organisations.
    However, there is much to be said for encouraging an innovative approach based on more than one scheme. Certainly, there is a good case for making use of the professional knowledge and expertise that industry bodies have by allowing some scope for that to be used in establishing tenancy deposit protection.
    We finally considered a hybrid of the two options, whereby the Government would procure a custodial scheme, to meet any gaps in schemes proposed by the industry, and industry bodies would also have the opportunity to come forward with their own schemes which, providing they met certain minimum standards, would receive government approval. However, we wish to ensure that any organisation chosen to run a tenancy deposit scheme is chosen on the basis of a fair selection process and that no particular organisation is given an unfair financial and competitive edge. Therefore, we have decided against setting up two different systems to select scheme administrators.
    The proposed clauses give the appropriate national authority the flexibility to make arrangements with either private organisations or public bodies to administer such schemes. However, the Secretary of State's intention in relation to England is to open up the opportunity to set up and run both custodial and insurance-based schemes to all private organisations, rather than just industry bodies.
    We will still be looking for a range of schemes, but by choosing schemes as a result of competitive tendering processes, the Government can thoroughly examine the merits of each proposed scheme against certain set criteria. That should lead to a higher quality of scheme being procured. We would expect, and indeed welcome, bids for the tender from organisations currently running voluntary schemes.
    The new clause proposed in Amendment No. 222A places a duty on the appropriate national authority—the Secretary of State in England and the National Assembly for Wales—to ensure that at least one tenancy deposit scheme is set up. The main purposes of a tenancy deposit scheme will be to safeguard tenancy

    1377
    deposits paid in connection with an assured shorthold tenancy and to facilitate the resolution of disputes arising in connection with the deposits.
    We intend for the national authority to be able to enter into contractual arrangements with private organisations to set up and run such schemes on its behalf. Through the contractual relationship, government will be able to review the administration of schemes, monitor the accounts and provide other information to ensure that schemes continue to offer value for money. Such schemes are expected to be self-financing, although the authority may be able to contribute to start-up costs if it feels that that is necessary.
    The new clause proposed in Amendment No. 222B provides that no landlord can take a deposit—which can only be money—unless it is safeguarded by a scheme. That will offer maximum protection to tenants and puts the onus on the landlord to ensure that if they wish to take a deposit, the deposit must be safeguarded by an authorised scheme. This reassurance should also reduce the likelihood of tenants withholding their last month's rent in anticipation of not getting their deposit returned.
    A landlord will have to tell their tenant which scheme their deposit is being held under and details of the relevant legislation under which the deposit will be protected. The tenant will then be able to check with the scheme that that is the case.
    The new clause proposed in Amendment No. 222C deals with the court proceedings for tenancy deposits. Where a landlord fails to tell the tenant which scheme their deposit is held under, or the tenant is unable to obtain confirmation from a scheme that the deposit is safeguarded, the tenant will be able to get an order for the landlord to appear in court and account for that. If the landlord does not turn up in court or does not give enough evidence to satisfy the court, the court can require, at its discretion, for the deposit to be returned to the tenant or transfer it to an authorised custodial scheme. That must be done within 14 days.
    The new clause proposed in Amendment No. 222D describes the civil sanctions that landlords will face for non-compliance with the provisions set out in Amendment No. 222B. Where a landlord does not hold a deposit in accordance with a scheme or fails to tell the tenant which scheme it is held under, he will not be able to serve the usual two months' notice to the tenant to regain possession of the property. As well as that, where a court has ordered the return of the deposit to the tenant in accordance with the proposed new clause in Amendment No. 222C and that has not been undertaken, the tenant will then be owed an amount equal to three times the deposit amount. Such procedural and financial penalties should make landlords think twice about trying to operate outside the new scheme.
    All schemes must comply with the provisions of the proposed new schedule set out in Amendment No. 230B. All schemes must ensure that the correct amount of deposit is returned to the relevant party within 10 days of the landlord and tenant agreeing how much the tenant is to receive, or within 10 days of the scheme being notified of a court decision.
    All schemes must respond as soon as practicable to any request from a tenant to confirm that the scheme is safeguarding their deposit. Perhaps, most importantly, all schemes must also ensure that they offer some form of alternative dispute-resolution mechanisms, so that disagreements over deposits can be resolved without the unnecessary expense of going to court. Such mechanisms will be able to provide a cheaper, quicker alternative to the courts. However, they cannot displace the courts and both parties have the option of taking the matter to court either in the first instance, or if they are unhappy with any decision reached by alternative resolution.
    Amendment No. 242ZA amends Clause 213 to specify the parliamentary procedure applicable to orders or regulations made by the Secretary of Slate. Amendments Nos. 254 and 256 amend Clause 231, which deals with commencement and extent. These provisions are to come into force in relation to Wales by order of the National Assembly for Wales and in relation to England by order of the Secretary of State. I beg to move.
    Lord Hanningfield: We have tabled Amendment No. 238N in this group which we will not move. Perhaps I may make some general comments on the amendment that the Minister has just moved.
    Obviously, we support this scheme in general. Like other parts of the Bill in the past few days there has been much information about it, and the noble Lord has just given much more information which we need to digest and think about. The explanations he gave about the scheme and the way in which it might be operated need some analysis before we can make much comment.
    Much of my original notes are now totally irrelevant since we had the statement from the Minister. However, the schedule does seem to deal mainly with two situations. It seems to protect mainly tenants and their deposit. I did not pick up in the Minister's explanation of what happens when tenants are in arrears with their rent. Can that deposit then be used to offset part of the rent? That was one of my concerns.
    There is another problem when tenants have left, cannot be traced and the arrears might be more than the deposit. There are several solutions that one could examine. Although we support the thrust of the amendment, has there been enough consultation with both sides of the industry—landlords and tenants? The Minister's comments that the proposal is to go out to tender for a scheme, if I am correct, were interesting. That would seem a novel departure and something that I would probably support. If one is going out to tender, there needs to be careful thought over what the tender is for. We need more detail about that.
    These schemes will cost money, like everything else in the Bill. We do not know exactly where that will come from. I shall not say much more today. I wish to examine this matter in considerable detail, and, like

    1379
    many other issues, we shall have a more detailed discussion on Report, when we have analysed what the Minister has said.
    Baroness Maddock: I very much welcome these new clauses. As the noble Lord, Lord Hanningfield, said, it is difficult for us, in that we have not had time to examine this matter in much detail. I have one or two questions. This is an issue that has been around for a long time and we are all delighted. These Benches have campaigned on it for a number of years. I can remember present members of the Government pushing for this in the 1996 Housing Bill when the Conservatives were in control. We are now in 2004 and I am just beginning to think that perhaps when we get to the next housing Bill most of the matters that we discussed in 1996 will have been enacted. It has taken a long time. I appreciate that it is not an easy issue, but it was on 19 May—I remember that clearly, because it was my birthday—that the Minister in another place, Keith Hill, announced that the Government would be introducing these amendments. It is disappointing that we are not in a position to be able to flesh this out more in Committee because of the lateness of attempting to put them on the statute book.
    3.15 p.m.
    Much of the detail will be left to schedules and some of the questions will still be unanswered. I hope that the Minister will assure us that there will be full consultation with all the interested parties, not just the industry, over how the secondary legislation will be developed and how the schemes will be set out. The Minister will know that Shelter and the Citizens Advice Bureaux have been campaigning with us for many years. One area that concerned them was the dispute resolution function which the Minister has just explained. Everyone is very pleased that that has been included.
    There are some concerns regarding non-compliance by landlords. It depends how the schemes work. If the landlord pays a deposit into the scheme but does not comply by returning it if tenants are being evicted, then there is something that can be used against the landlord—they would forgo the automatic Section 21 grounds for possession. But if tenants leave and find that the landlord has not paid the deposit into the scheme, they will not be in a better position than they were originally. That is an area that we shall explore further on Report. In the mean time, perhaps the Minister will explain how that would work.
    Some proposals have been put to me regarding how the matter could be dealt with. Perhaps tenants should always pay the deposits into the scheme themselves. There has been a suggestion that where tenants find that the landlord has not paid the deposit into the scheme, then the tenants could withhold their rent. The Government would probably not wish to permit that because encouraging people to withhold rents is not generally a good idea.
    One or two other queries have been raised with me by the British Property Federation in connection with the Law Commission's proposals on tenancy reform.
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    Originally, that was to be considered with the reform of tenancy legislation and there is still a situation where landlords are not necessarily required to provide a written agreement. How will that play with the Government's proposals? Regarding the insurance schemes that the Minister mentioned, many people feel that the bureaucracy surrounding the regulation of those by the Financial Services Authority means that people might not be keen to come forward with those schemes.
    As the noble Lord, Lord Hanningfield, said, it has been tricky for us to get to grips with the amendments in a few days and I am sure that we shall return to the issue on Report. If the Minister cannot answer my questions today, perhaps he can help us out between the two stages.
    Baroness Gardner of Parkes: I am pleased to be able to speak on this matter and I declare an interest as a small landlord for more than 40 years. This is an important issue. I am familiar with the New South Wales system in Australia, whereby all deposits are held centrally. The system works well and there is no problem with it. There are already many agents that operate good, sound deposit schemes; at the end of a tenancy the funds are not released to either party until there is agreement between the parties.
    However, I do understand what the Minister said about bad landlords. That is what this is all about. There are bad landlords. I can tell you that there are pretty bad tenants, too. About 30 years ago I once did not take a deposit from a very charming young man who told me that he and his friends were working on an oil rig in the North Sea and they just wanted to have a break for a month or so to occupy a little place that was a subsidiary part of my own home—but detached, so I could not hear any noise. I was fool enough to fall for that. The people moved in. When they left, it turned out that they had been a pop group, high on drugs. They had smashed the chairs into 27 pieces, they had ripped all the lights out of the walls, and they had vomited all over every bit of towel or linen in the place—the bin was full of them. Whatever deposit we had, we could not possibly have made good the damage that they did. That taught me that one should always have some sort of deposit for default and dilapidation. This is the problem.
    The Minister said that tenants default in paying their last rent because they are concerned that their deposit will not be returned. I wonder whether that is not a chicken and egg situation—they know that it will not be returned because of what they have done to the place. They default and they know that the landlord is left with nothing, because if they do not pay the last rent, he or she does not have a penny to come back. As the noble Lord, Lord Hanningfield said, it is difficult to get hold of anyone once they have gone. If they want to vanish they can vanish very easily. There may be cause why some tenants do that.
    I am told by reliable estate agents that more than 10 per cent of shorthold tenants now fail to pay the last month's rent. For that reason, I believe that if this deposit scheme is set up, which is a good thing because

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    it will cover the bad landlords, there should be the option of demanding up to six weeks' rent as a deposit. It would be by agreement between the landlord and the tenant. If it was up to six weeks, then even if they failed to pay the last month the landlord would have at least two weeks' rent, which would go some little way to making up whatever damage they have done. The tenants should not be worried about losing their money, because under this system, it would be secure. But it is quite right that deposits should apply to unpaid rent at the end, as to anything else.
    There have been voluntary schemes in operation and there has been limited take-up, but I am told that those schemes that have been operating have worked quite well. The Minister said that he had considered using more than one scheme. I am not really in favour of that—I think that it is confusing for tenants. It is better to have one scheme, whatever that one scheme is.
    People asked how the tenant would know whether or not the landlord had deposited the money. There is a simple answer to that. When I was on the GLC housing committee, whenever we went out to visit tenants they would say that they had reported problems with their flats three weeks or six months ago and the council would always say that it had had no report. I introduced a system whereby the day the tenants reported their problems they got a little voucher showing that they had reported something wrong on that date. Originally there was great officer objection to that, because they did not want it to be possible to prove that they had done nothing over months. However, they operated it in a pilot scheme and it worked so well that it was introduced universally.
    The way for the tenant to be sure that the deposit has been paid is for him to have a copy of the deposit slip. Provided that he is well enough informed to know that such a thing exists and that he is entitled to it—it would be up to the Government and the citizens advice bureaux to see that that happened—no one would be more interested in having that proof positive that the landlord had made the deposit than the tenant himself. That is the way around that one.
    The custodial or insurance-based scheme is very complicated and we certainly need to give a lot of thought to how it works. It is important to have it work one way or the other. Small agents, who are often very good with lettings, tell me that if there will be big costs involved, they would have to become members of something in order to be able to pay in these tenants' deposits. That could be a great worry to them, because they do not have a big enough profit margin to continue in business and they would be done out of things by big agents who had big overheads but also big money coming in. That is another important thing.
    As the Minister would know, there is already an exclusion of unreasonable clauses in tenancy agreements, so no one could write into their tenancy agreements something that would counter any reasonable decision made about deposits. There is protection for tenants in that, too.
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    The Minister referred to non-compliance, which is covered in Amendment No. 222D. He said that the tenant will be owed three times the deposit if the landlord is at fault. That sounds fine, but if the landlord does not get their rent, will they be allowed twice what they have missed out on? It would be wrong to have a huge penalty one way without some sort of counterbalance the other way. Above all, we want to retain a good system whereby landlords and tenants both benefit from the letting and occupation of a property.
    The use of independent inventory clerks for check-in and check-out is important. Although the costs have to be shared on these things, each party then has a good, sound basis. Even in Australia, under the New South Wales system, there has to be a full inspection and any faults in the property noted at the time that the tenant moved in, so that no one can claim that they happened during the tenancy.
    This an interesting subject and it is good that it has come forward, but there are lots of issues to discuss, such as that of the untraceable tenant mentioned by the noble Lord, Lord Hanningfield, and the dispute resolution mentioned by the noble Baroness, Lady Maddock, which also works well in Australia. I hope that we will get more detail.
    Finally, the amendment refers to a schedule dealing with the provisions relating to tenancy deposit schemes, and I wonder if the Minister could say which schedule that is or whether it is a schedule that is not yet visible.
    Lord Best: I spoke on this issue at Second Reading, and I congratulate the Government on bringing forward these provisions—they are pleasing to see. I would like to pay tribute to the outside agencies that did all the hard work in the background—the CAB, in particular Liz Phelps, who put a lot of work into bringing forward these ideas, Shelter and the Brent Private Tenants Rights Group.
    Before putting the final touches to this, because there is some detail left to deal with, will the Minister convene one or two meetings with those people who have done so much work on it? We need to look carefully at the pilot scheme that this has been based on, and bring in the British Property Federation and others, just to make sure that at the last stages we get the final touches right. I congratulate the Government on bringing forward this important extra part of the Bill.
    Lord Lucas: I have a number of detailed questions to ask, but first of all I wanted to suggest to the Minister that he and his team might look at eBay for some lessons to be learnt in relation to this scheme. I do not know if the Minister is a regular trader on eBay, but if he is he will know that the way in which one assesses the wisdom or otherwise of trading with a particular person is their record, which is available on eBay, of completed purchases or sales. Every time a person purchases or sells something on eBay, they give feedback as to whether they have been paid properly,

    1383
    and the person who has bought reports whether the goods have been received in good condition and promptly. That way a person builds up a record.
    Now, it seems to me that we could do something similar here—we could build up a record for landlords and tenants. A person could look at their landlord, and say, "This landlord regularly repays deposits properly, and things are settled sweetly; he is a good guy to be with". Alternatively, the landlord could look at a tenant and say, "This tenant has a string of black marks, I am not at all sure that I want him". It is an enormous incentive to behave properly. Of course someone could avoid it by changing their name or changing their description, but then they have no record, and, after a while, a landlord with no record is going to be someone whom a tenant will treat cautiously.
    The system works on eBay. It works astonishingly well—there is a very large business being built on the back of that one idea. I think it would fit very nicely with the scheme and I welcome the scheme as a whole. Can I just ask a few questions about it? What is the Government's initial impression as to the cost of this? How much will a landlord have to pay per tenancy for the deposit scheme—what is it likely to cost?
    What are the reasons for not making dispute resolution compulsory or at least making it possible for dispute resolution to be binding, if that is what the particular scheme decides it should be? Obviously, there is an appeal for the court beyond that, but commonly in, say, the building industry, these dispute resolution procedures have a strong binding element and appeals are only possible on limited grounds.
    I remember taking that particular scheme through this House. It seems to me that that tends to reduce the problems, particularly when dealing with a difficult landlord or a difficult tenant. The matter can be put into dispute resolution and that is quicker, easier and much more informal than any process held in the courts—particularly if it is a tenant dealing with a difficult landlord. How much will it cost that tenant to go through the court proceedings that will be necessary in order to get back his deposit? In terms of both effort and money, what does it cost?
    Lastly, it does not seem to me that there are sufficient penalties for a landlord who does not pay the deposit over to the scheme. Someone has to go to court to force him to do so. He has 14 days in which to act. Ultimately, it has cost him nothing; he has just been able to hang on to the deposit for a while and, if the tenant has been active enough to make him pay over the deposit, he will probably have had it for three or four months. So far as I can see, no extra cost penalty is incurred by having failed to pay it over.
    Surely there should be an automatic penalty for not paying over the deposit, which acts as a substantial disincentive to ever doing such a thing. A 100 per cent fine would not seem out of place so that you could be sure that landlords who did this would feel the pain of it and not only when they failed to behave at the end of
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    the 14-day period. But obviously, along with my noble friend and others, I wait for a later stage to look into this matter in greater detail.
    3.30 p.m.
    Lord Bassam of Brighton: First, I thank all noble Lords who contributed to the discussion. It lasted longer than I would have expected, although that is probably quite reasonable under the circumstances. A fair amount of information was given from our side of the Dispatch Box on disclosing how the scheme is to work. I thought that we would have more questions on it. I am grateful for the questions that were raised and for the useful contributions. I shall try to deal with them in turn.
    The noble Lord, Lord Hanningfield, was concerned about the costs of the scheme. The noble Lord, Lord Lucas, asked how much it would cost per tenant. I cannot give the noble Lord, Lord Lucas, an answer; we do not have an estimate. But, in essence, the scheme should be self-financing, as I said earlier when moving the amendment.
    It was also suggested by the noble Lord, Lord Best, that perhaps we needed to finesse some of the detail. I join the noble Lord in paying tribute to the voluntary organisations—in particular, Shelter and NACAB—and the local authorities, which have been very helpful in putting together this set of propositions. Their experience has been valuable.
    We have consulted fairly thoroughly. As I said earlier, we have drawn on two useful pilots, and we consulted on tenancy deposits between November 2002 and February 2003. That was a very useful exercise. We published a full response to the consultation paper, which is available on our departmental website.
    I was asked whether tenancy deposits can be used to offset rent arrears. That makes a great deal of sense. If a tenancy agreement states that, then of course the deposit can be used to offset arrears of rent. I am sure that that will become well established practice.
    The noble Baroness, Lady Gardner, asked whether landlords will have to become members in order to use a tenancy deposit scheme. The answer is: no. The custodial scheme at least will be open to anyone without membership. We think that insurance-based schemes are more likely to be used by larger-scale landlords, and I am sure that there will be a benefit in that. We believe that the schemes should be accessible and that the system that we are likely to see adopted will enable that to happen.
    The noble Baroness also asked whether landlords can demand a six-week deposit. There is nothing to stop landlords and tenants agreeing to six-week deposits in terms of these provisions. That should be helpful to landlords who want to ensure—
    Baroness Gardner of Parkes: I want to correct one point to which the noble Lord replied. My question was not whether landlords had to become members; I was referring to small agents.
    Lord Bassam of Brighton: The same response applies. The noble Baroness also asked why there was

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    more than one scheme. Landlords have indicated that they are in favour of insurance-based rather than custodial schemes as they can use the deposits as part of their working capital. The clauses allow for the appointment of a public body to administer one custodial scheme, should there be a problem with multiple schemes.
    The noble Lord, Lord Lucas, made an interesting suggestion concerning the use of eBay. My children use eBay and are fascinated by it. I know that we have thought of buying items through eBay and it is a very useful facility. My only thought in response to that is: who would validate the information and how would that work? But it is an interesting thought and certainly one on which we shall reflect.
    The noble Lord also asked why we should not make dispute resolution binding. I suspect that ultimately the court process will have to be used because that will probably give some finality and closure to an extended dispute. But I think that there is value in dispute resolution, and certainly the scheme as I described it this afternoon should provide for the opportunity of dispute resolution as a low-cost alternative to going to court. In the end, it may well be the case that, where parties cannot agree, the courts have to become involved.
    I shall give a little more detail on costs. The custodial scheme will be funded from interest on deposits. There will be no extra cost to landlord or tenant. Insurance-based schemes are likely to charge landlords fees—the trade-off for landlords keeping deposits—but there will be no charges to tenants.
    I think that I have covered most of the points. There was one question of fact relating to Schedule 8, to which I referred when speaking to Amendment No. 230B.
    Baroness Maddock: Before the Minister sits down, the noble Lord, Lord Best, and I both asked about further consultation with the bodies that have been involved. The noble Lord explained what consultation had been carried out thus far. However, in relation to one or two of the technicalities concerning how the scheme works, it seems clear to me that it would still be worth continuing with those consultations between now and the next stage.
    Lord Bassam of Brighton: We shall obviously continue the consultations. I have given as much detail as I can this afternoon. I appreciate that there will be requests for more information. Of course, we need to work very closely with all parties that have an interest in this matter to ensure that the scheme works most effectively.
    Baroness Gardner of Parkes: I want to return to the self-financing aspect. I find it a little unrealistic to think that the custodial scheme will be fully financed from interest. All of us who have any money that earns interest find that, even with the present rate, it amounts to nothing. Therefore, I want to go into that
    1386
    a little more or ask the Minister to look into it before the next stage of the Bill. He was not a Member of your Lordships' House when we dealt with a leasehold Bill.
    At that time, we had a Conservative government and it was stated that the scheme would be self-financing. I asked the then government to explain exactly what that meant. There were many different grounds on which one could apply to have one's lease extended. The reply was that the self-financing aspect would cover everything, even down to the milk for the office cat. That remark caused a sensation in your Lordships' House. Everyone was very worried about it and eventually a ceiling was put on what a private applicant to the leasehold tribunal could be asked to pay, no matter how long the proceedings lasted. Before that, there was a risk that a very rich landlord would drag out the process in order to prevent the leaseholder getting what he wanted.
    Therefore, if this scheme is to be self-financing, there should be a clear-cut measure so that people know what is involved. I think that it is a little on the doubtful side to assume that the scheme will be financed by interest.
    Lord Bassam of Brighton: That is a fair point. The noble Baroness is right, I was not a Member of the House during those Conservative days. I could make a cheap jibe about Conservative promises, but that would be unfair of me. Perhaps we should return with some illustrative figures at the next stage which may help to provide a measure of reassurance. I too would be interested in them.
    Lord Lucas: I was the Minister at the time who made that remark. I can tell my noble friend that I was extremely glad that she fought on that and eventually won. We had been hobbled by the Treasury into saying that the matter would be self-financing. It was her and her colleagues' efforts that enabled us to achieve what we wanted in our discussions with the Treasury. I am sure that subterfuge is not unknown to the Benches opposite. It gave pleasure at the time anyway. Thank you.
    I would appreciate the Minister writing to me on three matters. First, he said he did not have an estimate of the cost of the scheme, but he has run two pilots so he must have some idea. Perhaps he can let me know roughly where we are on that.
    Secondly, the Minister's ministry runs a dispute resolution scheme in the construction sector which was put in place when I occupied his position. That has a strong element of binding about it. Will the Minister talk to colleagues involved in that and write to me saying why, in this case, binding is not appropriate? It was a fairly fractious sector and disputes were common and protracted. It appeared that binding was appropriate in those cases and I would very much like to know why we are not following that precedent now. There may be good reasons, but I would like an explanation.
    Finally, he did not answer my question about why there is no real penalty on a landlord who does not pay over the deposit straightaway. Why, when one has

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    taken a landlord through the courts, does he not simply have to do what he should have done in the first place without paying a penalty for having misbehaved?
    Lord Bassam of Brighton: I apologise to the noble Lord for that last point. I had made a note of the question. It is probably best if I write to the noble Lord on all three points. The second point about binding is a valuable one. We may be able to draw on the earlier experience of the noble Lord. I said to the noble Baroness, Lady Gardner, that we would try to return with some illustrative costs to help all concerned. I shall put that in correspondence, which will be shared with all noble Lords who have participated in the debate.
    Lord Lester of Herne Hill: On the matter of binding, will the Minister and his officials look at the recent judgment of the Court of Appeal explaining why alternative dispute resolution procedures cannot easily be treated as binding without being inimical to the purpose of the scheme itself? I believe that needs to be looked at too.
    Lord Bassam of Brighton: I am happy to give that commitment.
    On Question, amendment agreed to.
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendments Nos. 222B to 222D:
    After Clause 186, insert the following new clause—
    "REQUIREMENTS RELATING TO TENANCY DEPOSITS
    (1) Any tenancy deposit paid to a person in connection with a shorthold tenancy must, as from the time when it is received, be dealt with in accordance with an authorised scheme.
    (2) No person may require the payment of a tenancy deposit in connection with a shorthold tenancy which is not to be subject to the requirement in subsection (1).
    (3) No person may, in connection with a shorthold tenancy, require a deposit which consists of property other than money.
    (4) In subsection (3) "deposit" means a transfer of property intended to be held (by the landlord or otherwise) as security for—

    (a) the performance of any obligations of the tenant, or

    (b) the discharge of any liability of his,

    arising under or in connection with the tenancy.
    (5) Subsections (1) to (4) apply despite any agreement to the contrary.
    (6) If a tenancy deposit is required in connection with a shorthold tenancy, the landlord must give the person by whom the deposit is to be payable such information about—

    (a) the authorised scheme which is to apply to the deposit, and

    (b) the operation of provisions of this Chapter in relation to the deposit,

    as may be prescribed.
    The information must be given in such manner, and by such time, as may be prescribed.
    (7) In subsection (6) "prescribed" means prescribed by an order made by the appropriate national authority."
    After Clause 186, insert the following new clause"—
    "PROCEEDINGS RELATING TO TENANCY DEPOSITS
    (1) Where a tenancy deposit has been paid in connection with a shorthold tenancy, the tenant may make an application under subsection (2) if—

    (a) section (Requirements relating to tenancy deposits)(6) has not been complied with in relation to the deposit, or

    (b) the tenant has been notified that a particular authorised scheme is to apply to the deposit but has been unable to obtain confirmation from the scheme administrator that the deposit is being held in accordance with that scheme.

    (2) An application under this subsection is an application to a county court for an order requiring the landlord to attend the court to give evidence showing that the deposit is for the time being held in accordance with an authorised scheme.
    (3) Subsection (4) applies if the court makes such an order and—

    (a) the person ordered to attend the court fails to attend, or

    (b) the court is not satisfied that the deposit is being held in accordance with an authorised scheme.

    (4) The court must, as it thinks fit, either—

    (a) order the person who appears to the court to be holding the deposit to repay it to the tenant, or

    (b) order that person to pay the deposit into the designated account held by the scheme administrator under an authorised custodial scheme,

    within the period of 14 days beginning with the date of the making of the order.
    (5) Where any deposit given in connection with a shorthold tenancy could not be lawfully required as a result of section (Requirements relating to tenancy deposits)(3), the property in question is recoverable from the person holding it by the person by whom it was given as a deposit.
    (6) In subsection (5) "deposit" has the meaning given by section (Requirements relating to tenancy deposits)(4)."
    After Clause 186, insert the following new clause—
    "SANCTIONS FOR NON-COMPLIANCE
    (1) If a tenancy deposit has been paid in connection with a shorthold tenancy, no section 21 notice may be given in relation to the tenancy until such time as the deposit is held in accordance with an authorised scheme.
    (2) If section (Requirements relating to tenancy deposits)(6) is not complied with in relation to a deposit given in connection with a shorthold tenancy, no section 21 notice may be given in relation to the tenancy until such time as that provision is complied with.
    (3) If any order made under section (Proceedings relating to tenancy deposits)(4)(a) or (b) is not complied with by the person holding the deposit, that person is liable, as from the end of the period of 14 days mentioned in that subsection, to pay to the tenant a sum of money equal to three times the amount that was required to be repaid or paid by virtue of the order.
    (4) That sum is recoverable by the tenant as a debt due to him from that person.
    (5) If any deposit given in connection with a shorthold tenancy could not be lawfully required as a result of section (Requirements relating to tenancy deposits)(3), no section 21 notice may be given in relation to the tenancy until such time as the property in question is returned to the person by whom it was given as a deposit.
    (6) In subsection (5) "deposit" has the meaning given by section (Requirements relating to tenancy deposits)(4).
    (7) In this section a "section 21 notice" means a notice under section 21(1)(b) or (4)(a) of the Housing Act 1988 (recovery of possession on termination of shorthold tenancy)."
    On Question, amendments agreed to.
    3.45 p.m.
    Lord Avebury Lord Avebury moved Amendment No. 223:
    After Clause 186, insert the following new clause—
    "PROVISION OF ADEQUATE AND SUITABLE ACCOMMODATION FOR GYPSIES AND TRAVELLERS
    (1) It shall be the duty of every local authority, being a district council, the council of a metropolitan district or London borough, or unitary authority, to exercise their powers under section 24 of the Caravan Sites and Control of Development Act 1960 (c. 62) (power of local authorities to provide sites for caravans) so far as may be necessary to provide, or to facilitate the provision of, adequate and suitable accommodation to meet the needs of Gypsies and Travellers residing in or resorting to their area.
    (2) Where it appears to a local authority that any other authority could, by taking any specified action, help in the discharge of their duty under subsection (1), they may request the help of that other authority specifying the action in question.
    (3) An authority whose help is so requested under subsection (2) shall comply with the request if it is compatible with their own statutory or other duties and obligations and does not unduly prejudice the discharge of any of their functions.
    (4) The Secretary of State may, if at any time it appears to him to be necessary to do so, give directions to any local authority to which subsection (1) applies requiring them to provide, or facilitate the provision of, pursuant to subsection (1), such sites or additional sites, for the accommodation of such numbers of caravans, as may be specified in the directions; and any such directions shall be enforceable, on the application of the Secretary of State, by mandatory order.
    (5) In subsection (1) "accommodation" includes temporary stopping places as well as permanent accommodation, and in subsection (3) "other authority" means any local authority, including a county council, district council, the council of a metropolitan district or London borough or unitary authority.
    (6) Section 24 of the Caravan Sites and Control of Development Act 1960 is amended as follows.
    (7) In subsection (2)(c), for "gipsies" substitute "Gypsies and Travellers".
    (8) In subsection (8) for "gipsies" substitute the following definition—
    "Gypsies and Travellers" is defined as follows—
    "Gypsies" means Romany Gypsies;
    "Travellers" means—

    (a) Irish Travellers,

    (b) members of ethnic groups for whom living in a caravan is part of their traditional way of life, or

    (c) persons of nomadic habit of life, whatever their race or origin.""

    The noble Lord said: This amendment is not about the restoration of a statutory duty, as in the Caravan Sites Act 1968, where local authorities were obliged to provide accommodation for all Gypsies residing or resorting to their area, but simply seeks to provide that they exercise their powers under the 1960 Act so far as may be necessary to provide the sites themselves or to facilitate the provision of adequate and suitable accommodation for the needs of Gypsies and Travellers. I shall explain that this is not nearly as onerous a duty as it was in the 1968 Act.
    The Government have wisely decided that the accommodation needs of Gypsies should be dealt with from 2005 onwards as part of the process of housing needs assessment, as Keith Hill told the ODPM Select Committee on 13 July. Therefore, it is useful to see how planning and housing policies for Gypsies will fit together. The assessments by local housing authorities,
    1390
    which have to be conducted in accordance with the methodology that is laid down in the revised ODPM guidance now being developed by the University of Cambridge, and quality assured by the regional housing boards, will be aggregated into the regional spatial strategy and that will indicate the number of pitches required over a five-year period in the area of each authority. So under this framework we can assume that there will be sufficient land specified in local development documents to meet the accommodation needs of Gypsies and Travellers.
    For the first time, presumably, we shall know something about the transfers of Gypsy and Traveller families into and out of settled accommodation because that will be an obvious part of the needs assessment. In many of these debates, there is an unspoken assumption that Gypsies are permanently immured on their caravan sites, but the reality is that a large number of Gypsy families already live in housing and there is some movement in both directions.
    For the past five years, ever since Chris Mullin was the responsible Minister at the DETR, I have tried to persuade the Government to get local authorities to record such movements. We need to know more about the preferences of these communities and to offer them the same variety of choices, including ordinary housing and group housing, pioneered in the Republic of Ireland but ignored by the ODPM, as are available to people who live in settled accommodation.
    The majority of Gypsies and Travellers would like to continue living a traditional way of life, although about 80 per cent of them want to stay on one site, either out of choice or necessity. As there is a shortage of some 4,000 pitches in England, a family that gains a pitch on a permanent site tends to stick to it, even if their inclination is still to travel.
    The question is who will develop the sites that are needed. It was clear from the replies given by Mr Hill in evidence to the ODPM Select Committee on 13 July that he was thinking that the vast majority of travellers would provide their own sites and that registered social landlords would come in only as an afterthought. He said that placing a duty on local authorities,
    "would put Gypsies and Travellers arguably in an advantageous position by comparison with other local residents with housing needs … the introduction of the duty does not really sit comfortably with our policy of expanding areas of choice, discretion and decision making amongst local authorities".
    There is plenty of evidence to show that Gypsies want to develop their own sites in the form of the increasing number of planning applications and appeals by people from the Gypsy community. In the year to 31 March 2004, Gypsies lodged 118 appeals against refusal of planning permissions of which they won 49. However, many of those were for temporary permissions, according to Dr Donald Kenrick, to whom I am indebted for the figures and with whose work I believe the department is familiar. I believe that it has been acknowledged that he is the foremost expert on the matter in the country. Dr Kenrick points out that if private sites were gained at the rate experienced in 2003, it would take 27 years for enough to be

    1391
    provided to those living on unauthorised sites and that is without making any allowance for new household formations in the Gypsy community.
    Most of the refusals were because the land is in unsuitable locations, such as green belt, as was shown in "Tonight with Trevor McDonald", the week before last. That programme also demonstrated that the applicants have no choice. There is a long queue for places on even the most appalling public sites—under motorways or next to sewage farms—and the alternative is a periodic struggle against the bailiffs and the police. There are few willing sellers of land. However, if vendors could have obtained planning permission for some more profitable form of development, they would not have sold the land to Gypsies.
    The transactions tend to reflect that lack of apparent development potential. When the new planning system is in force, and land is designated as suitable for a Gypsy site, presumably its value will be that much greater and correspondingly fewer Gypsies will have the resources to buy the land. I put that point in a letter to the noble Lord, Lord Rooker, on 20 July, but I gather that the letter went astray. I have only recently re-sent it, so I am not blaming him for not having yet replied. The matter needs careful consideration.
    Gypsies may be able to get planning consent more readily under the new regime, but will probably have to pay a lot more for it; indeed, some will be priced out of the market. The Minister may say that is no different from the situation of low-income house dwellers who cannot afford to buy their own properties, but in their case there are other options available: privately rented accommodation, or housing provided by registered social landlords. Neither of those agencies will deal with Gypsies.
    The Novas Ouvertures group would like to develop sites and group housing and may well make some contribution; however, there are no other RSLs queuing up to offer their services, and no private landlords on the horizon either. That is why, for low-income families—hundreds of them now statutorily homeless—the duty of local authorities to provide or facilitate embodied in this amendment is so essential.
    The Minister said, in his reply to question 321 in the ODPM Select Committee, that the amendment would have "significant spending implications". However, if he is right in thinking that nearly all Gypsies would prefer to own their own site, and they have the money and they can get planning permission, the demand for new pitches on local authority sites would be modest. Last January, there were 3,700 caravans on unauthorised sites. If only 10 per cent of them cannot afford to buy land and develop it as a site of their own, the local authorities would only need to provide 20 new sites in the whole of England, the cost of which might possibly amount to 0.1 per cent of the ODPM's budget, even if all the sites were provided in one year. Against that could be set the considerable cost of evictions, which would then be a thing of the past. It took 40 bailiffs from Gypsy and squatter eviction specialists Constant and Co. to evict
    1392
    Gypsies from the Bulkington site in Warwickshire in June, at an estimated cost of £ 150,000, one of a number of evictions on a similar scale so far this year.
    If there is to be no duty to provide, how does the ODPM expect local authorities to meet their obligations to Gypsies under the Homelessness Act 2002? As the noble Lord knows, a Gypsy family is homeless under the Housing Act 1996 if their caravan is on an unauthorised site and there is nowhere they are entitled to put it. The Homelessness Act 2002 requires local authorities to ensure that sufficient accommodation is available for people who may become homeless in their area. If, as the courts have decided, Gypsies with a cultural aversion to bricks and mortar cannot be put into bed and breakfasts would they not have to commission more sites in order to comply with the law?
    I realise that all those matters will become clearer when the ODPM publishes the outcome of its review that has been going on since early this year, and that the noble Lord may not be in a position to say much this afternoon. We are told that that outcome is not likely to appear before mid-October—in fact, roughly at the same time as the Select Committee on the ODPM publishes its own report.
    Another matter of great importance arises out of discussion in the ODPM Select Committee in the consultations the ODPM has undertaken: the question of the definition of "Gypsies and Travellers" that has to be drafted to replace the existing one in the Caravan Sites and Control of Development Act 1960. There, Gypsies—then spelt "gipsies", with a small "g"—were defined as
    "persons of nomadic habit of life, whatever their race or origin".
    That, however, urgently needs to be updated.
    First, as already noted, most Gypsies and Travellers are no longer nomadic. Secondly, the courts have decided, in the case of Berry, that a person who gives up travelling, for whatever reason, ceases to be a Gypsy. If that were to be applied strictly, any family allocated a pitch on a local authority Gypsy site would cease to be entitled to live there if it were known that they had decided to stay there permanently. The same would apply to an Irish Traveller in a similar position.
    Gypsies and Irish Travellers are minorities, recognised as such for the purposes of race relations registration. Their separate needs for health and education services, for example, as well as for accommodation, have to be dealt with so as to secure their equality with other sections of the community under the Race Relations (Amendment) Act 2000. The Court of Appeal's decision in the Berry case has to be corrected while the opportunity is before the House.
    We therefore define "Gypsies" in the new clause by their ethnicity, making no distinction between those who still keep to their ancient way of life and those who decide to settle down permanently, whether on a site or in bricks and mortar. Travellers can be either Irish Travellers, to whom the same reasoning applies, members of other ethnic groups for whom living in a caravan is part of their traditional way of life, or, as before, persons of a nomadic habit of life.
    The definition would not increase the number of families wishing to live on Gypsy caravan sites. We believe there are very few families now settled in housing who would seek to revert to living in caravans if that were made easier for them than at present, and they would be counterbalanced by an equal number of families moving in the opposite direction. If more Gypsies living in houses did want to move on to the sites, and vice versa, that much housing would be released for the benefit of other applicants. I know the ODPM's concern with a statutory duty is mainly on the grounds of cost, and I hope these arguments will help to alleviate that anxiety.
    I welcome the review of Gypsy policy that has been conducted by the ODPM, including the consultations at a number of seminars in the spring. I attended one in Derbyshire, and I think the ODPM found it useful as a means of exploring the main issues and ascertaining the latest views of stakeholders. In addition, I had a meeting with Yvette Cooper, the then Minister, at the beginning of March, and I am sure your Lordships would like to join me in sending our best wishes to Ms Cooper on the recent birth of her daughter, which has meant that her duties have been taken over for the time being by Mr Keith Hill.
    I sent a 3,000-word memorandum to Ms Cooper, a couple of days after I met her in March, covering the main points raised, as well as supplementary letters on 6 and 27 March, covering the problems of definition that I have just discussed, and reviewing the Wrexham and Basildon cases. At that time, it was expected that the outcome of the review would be published in July, as Ms Cooper herself had said tentatively at the launch of the IPPR paper on Gypsy policy in January. However, the date has slipped for the second time, now that Keith Hill has appeared before the Select Committee.
    I understand that the ODPM may not want to risk criticism by publishing the outcome of its review before the Select Committee reports in mid-October, but, like everybody else who has looked at the subject recently, the ODPM Select Committee is almost certain to recommend the restoration of a statutory duty in some form. As that is the policy of not only the Select Committee but also of the National Farmers Union, the Local Government Association and the other authorities who have looked into the matter, I hope at least we shall have some encouragement from the Minister this afternoon that the statutory duty in the form outlined in this proposed new clause will be restored. I beg to move.
    Lord Lester of Herne Hill: It is a privilege to take part in this debate led by my noble friend Lord Avebury. If he will allow me to say so, I regard him as the best champion of human rights in the House, certainly on these Benches. I remember, ever since I have been here, the way in which he has taken up this important cause again and again on behalf of one of the most vulnerable and persecuted minorities in Europe. I should declare an interest, because I chaired
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    the European Roma Rights Centre in Budapest for five years, and am also a member of the Joint Committee on Human Rights.
    I want to concentrate on one thing in support of this amendment: the need to give effect to the important judgment of the European Court of Human Rights in the case of Connors and the United Kingdom—
    4 p.m.
    Lord Avebury: My noble friend is speaking on the subject of the next amendment, on which I had asked for a separate debate. Although the two amendments were grouped together originally, I thought that the Connors judgment was sufficiently important to be dealt with separately from the issue of site provision.
    Lord Lester of Herne Hill: I apologise: I thought that the amendments had been grouped together.
    The Lord Bishop of Newcastle: I, too, support the amendment. Over the years we have failed, centrally and locally, to provide for the accommodation needs of the Gypsy and Traveller communities. As we know, this has led to such problems as the illegal development of sites and unauthorised encampments. It has had a negative effect on many settled residential communities, leading to had community relations, hostility and local conflict. Consequently, it has also become increasingly difficult for Travellers to gain access to the most basic services, particularly health and education. However, I have been impressed by recent initiatives taken by the Department for Education and Skills in the education of Travellers' children.
    The amendment asks the Government to consider the accommodation needs of the Gypsy and Traveller community. To my mind, it offers the best way to do it: to lay a duty on local authorities. The provision of adequate sites—public and private, residential and transit—would address a number of the main problems. It would address the acute shortage of sites and would bring to an end illegal developments, unauthorised encampments and much local frustration, conflict and hostility.
    The concerns of settled communities, represented by local councils, parish councils, residents' associations and the like, in which those new sites are to be located, must be considered to allay the obvious fears and anxieties. But to accept the amendment would significantly raise the level of social inclusion of Travellers, and I suggest that such positive action is well overdue. Only such provision will eliminate the need for unauthorised sites and will go a considerable way to enabling settled residential communities and Travellers and Gypsies to live side by side in harmony with each other.
    We need to find a solution that will benefit Travellers and local residential communities. We need to give Travellers proper sites, with the same status as housing, so that they can be assessed and developed in the same way. Could we not allow Housing Corporation money to be used to help local authorities to provide and facilitate such sites? We can no longer live in the fond

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    hope that somehow a magical solution to this difficult problem will be found. We need a satisfactory solution for the benefit of Travellers and local residential communities, and I believe that this amendment does just that.
    Lord Graham of Edmonton: I support the aims and objectives of the amendment. Having served as the leader of a council and as a Member of Parliament dealing with constituency problems, I am not unaware of the delicacy and intricacies involved in this matter. I shall listen carefully to the Minister's response.
    Will the Minister tell us precisely why the law was changed to lift the obligation? That is the kernel of the problem. I am under no illusion, and nor will the Minister and his advisers be, that the problem will not be solved overnight or easily. The resources of every local authority are probably under strain, yet we will be asking them to find a site or sites adequate to provide for Travellers. It will not be easy, but we must start somewhere.
    The Minister may tell us that discussions and negotiations are ongoing. The Traveller community is entitled to have its problem dealt with, not once and for all, but so that it is appreciated that they are regarded as a distinct segment of the community. At the same time, the opportunity will be given to remind the Traveller community that they have responsibilities and are obligated to act as normal citizens provided that they are treated as such.
    If this amendment and the series of amendments related to it do not start the debate, I hope that they will result in continued discussion of this vexed issue. From a local council perspective, the phrase "Not in my back yard" comes readily to mind. Most people will want a resolution of the problem, so goodwill and diplomacy will be required from all stakeholders. I hope that the Minister can help us.
    Baroness Whitaker: I, too, would like to add my support to the amendments, which stand also in my name, and to convey the regrets of my noble friend Lady Dean and the noble Lord, Lord Ouseley, who, because of the rescheduling of the Bill, were unable to come, as they had hoped, to speak to it.
    We all felt that Gypsies and Travellers are in a uniquely disadvantaged position in lawfully finding somewhere suitable to their needs to live. It is no surprise that there is a general acknowledgement, not least by the Government, that changes need to be made.
    Lord Lucas: I add my support to the amendment. The conflict between the nomadic and the settled exists all over the world and stretches back, I suspect, to the advent of the first farmer. There will be no end to the potential for tension. I am well aware that all around the country, wherever the two communities come into proximity, there is the potential for flare-ups. In many cases, flare-ups have occurred, and they cause a great deal of emotion. But we should look at such matters from a background of liberty and tolerance, and
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    recognise that we must facilitate people's right to pursue another way of life, so long as they exist within reasonable norms, as the noble Lord, Lord Graham, says.
    I and many of my colleagues should feel particularly sympathetic towards Gypsies when we are in the process of having part of our way of life crushed by the majority. We should understand what it feels like to have the basis of one's existence denied by the majority. We should therefore feel notably sympathetic towards making sure that other people get what we would like to have, if I can put it that way. It is a case of "do as we would be done by".
    Baroness Miller of Chilthorne Domer: I welcome the amendment. Having been a councillor both pre-1994 and post-1994, I think that the amendment is particularly important. Before the repeal of the duty, councils felt able to be proactive; after the repeal, it was only the very brave councils which felt that they could enact Circular 1/94, and were often taken to task by their residents, who saw neighbouring councils doing nothing, as they were able to do. So I would welcome a duty being reimposed.
    I particularly welcome proposed subsection (2) in which one local authority can call on the help of another. Too often, that help has not been forthcoming. If all three tiers of local government can work together, it will help.
    Should the new clause be accepted, I hope that the experience of those who have tried to continue to provide sites will be understood. From what I have observed, small sites work very much better. I hope that if this duty is given again to local authorities, there will be guidance to the effect that one large site does not work well. Although it is harder because more local communities have to be addressed, the provision of several small sites across an authority seems to work very much better.
    Baroness Hanham: I do not want to pour cold water on the unusual unanimity in the House. However, having dealt with this matter as a former leader of a council, I need to raise one or two areas of concern.
    The noble Lord, Lord Avebury, has said that this duty is not really a duty. I do not quite understand that. In legislation, as I understand it, a duty requires you to do something and there do not seem to be very many ways around that. Perhaps he would be kind enough to explain that again when he responds to the debate.
    I have concerns about the inclusion within this of metropolitan districts and London boroughs. London boroughs, particularly those in inner London, found this burden almost impossible to bear under the previous legislation. It is a very major duty and one which in many cases is simply not achievable. Proposed subsection (2) would not help, because when one authority has finally managed to find land that is appropriate, it will not be terribly keen on providing it for others. In my borough in London, we co-operate and combine on this matter with the borough next

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    door to provide sites. I am bound to say that if we had to do it again, we would be seriously pushed to be able to provide these facilities.
    I do not think that we will be able to waft this through on the basis that it will be absolutely fine. It will not be fine in metropolitan areas and London borough areas. If the noble Lord pursues this measure, we would have to oppose that aspect of the legislation.
    Lord Bassam of Brighton: As noble Lords will know, I and my noble friend Lord Rooker have a great deal of sympathy with not only the new clause but also the cause that the noble Lord, Lord Avebury, has so assiduously pursued, certainly in my time in your Lordships' House.
    I am certainly in agreement with the idea that adequate provision should be made for Gypsies and Travellers. My local government experience showed me the folly of not doing that. As a product of my time as a leader of an authority that had a lot of green land around it, I also became very aware of some of the problems that are associated with Traveller encampments, and so on.
    Failures in the past have made it much harder for Gypsies and Travellers to have easy access to education, healthcare, employment and to take benefit from the other range of facilities which exist and should be on offer through the public service. I also agree that local authorities should work together and each make a fair contribution to meeting need. There should be a way of ensuring that need, where it is identified, is met to the same extent as housing need. However, I do not agree that imposing a new duty is necessarily the best way forward.
    My noble friend Lord Graham asked why the law was changed. I cannot speculate on the thinking behind the Criminal Justice and Public Order Act 1994, but it was part of an approach adopted by the then government, who held that the Caravan Sites Act 1968 was no longer effective. Although I regretted the Act's demise at the time, the then government had a point. Only 38 per cent of councils had met their obligations under the 1968 duty. Statistics suggest that unauthorised encampments fell by just 1 per cent as a result of the change in the law. The supposition behind the legislation was that Gypsies and Travellers would buy their own land, aided by Circular 1/94, which probably has not worked as well as some enthusiasts for it thought that it might.
    However, we need to move on. If the past duty is no longer seen as an effective way forward, other measures should clearly be taken. The previous duty did not result in the universal, high-quality and appropriate provision that modern standards suggest should be there. A duty that relates only to Gypsies and Travellers rather suggests that they should remain, as they have been for so long, outside the system. It perpetuates the idea that they are different and separate. Imposing a duty would be accepting that local authorities should not have to meet Gypsy and Traveller needs through the same mechanisms as they meet the needs of the rest of the community. I do not accept that. The only way to
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    ensure long-term, sustainable and high-quality provision for Gypsies and Travellers is to bring them within the systems that already exist and to provide them with a greater measure of equality in those systems.
    4.15 p.m.
    That should happen through the new planning system. Noble Lords who were present will recall that during discussions on the Planning and Compulsory Purchase Bill, my noble friend Lord Rooker and I were sympathetic to the pressure that was understandably brought to bear by the noble Lord, Lord Avebury, my noble friend Lady Whitaker and others. That Act will ensure that Gypsy and Traveller needs will be mainstreamed in the housing and planning systems, along with the needs of the rest of the community. Local authorities will work with regional housing boards to ensure that local and regional needs are met within the system. That will avoid the bureaucracy and conflict that would be likely to arise if local authorities were legally bound to assist other local authorities or to show why they could not, as is suggested by the amendment.
    It is of course essential that, in the process of mainstreaming, Gypsies and Travellers do not get lost among all the other groups competing for resources. Local authorities will need to think and act strategically in relation to Gypsy and Traveller needs, and they must accept their responsibilities willingly towards that often marginalised group.
    The noble Lord, Lord Avebury, has added to the amendment and to Amendment No. 225 a definition of "Gypsies" and "Travellers". All I can usefully say in response is that that is one of the issues on which we are due to report. The noble Lord's draft is interesting and appears to have value, but it would be premature to pursue that element of his amendment until the report is introduced. I cannot give him an exact date on which that report will be produced. I regret that it has been delayed, but I am sure that it has been delayed for good reason and that it will be important document of policy.
    I certainly sympathise with what has been said, but there are problems with the suggested approach. The Government have put more resources, effort and intellectual thought into dealing with such problems than previous governments, because we recognise that Gypsies and Travellers have suffered and have been marginalised. We want to try to embrace their needs and bring them within the systems that provide decent-quality public services for all. While we understand the point of view of the noble Lord, Lord Avebury, our approach is probably better suited in the long term to matching their needs and aspirations.
    Lord Avebury: I thank all noble Lords who have supported the amendment. That includes every noble Lord or Baroness who has spoken, with the partial exception of the noble Baroness, Lady Hanham, who poured cold water on the idea that the duty to provide for Gypsies and Travellers should be imposed on

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    London and metropolitan boroughs in the same way as it is on local authorities elsewhere. To recap what was said by the right reverend Prelate the Bishop of Newcastle and the noble Lord, Lord Lucas, this is a win-win situation between the Travellers and the settled community. If we can solve this problem, if we can get sites, then it will assist the Gypsies and, as the right reverend Prelate correctly observed, eliminate the nuisance we have up and down the country.
    The noble Lord, Lord Rooker, is well aware of this from the number of Members of another place who have raised the matter in adjournment debates. For example, the other day I spoke to Mr Paice, who represents the area of Cottenham, where there is a very large, unauthorised encampment. The noble Lord, Lord Rooker, may be interested to know that we had the Cottenham Residents' Association and the Gypsies speaking together in amicable terms at the meeting of the Traveller Law Reform Parliamentary Group. They agreed that this was the right way forward, that there should be a duty on local authorities to provide sites and that that would enable unauthorised encampments, such as we have at Cottenham and in the village of Minety, which was dealt with in Trevor MacDonald's programme, to which I have already referred, to be eliminated.
    Viscount Goschen: I thank the noble Lord for giving way. I was extremely interested in the last point he made. It is the key to the whole issue. Will he expand a bit further on why he is so confident that all Travellers—a notably independent-minded group of people—would use sites officially approved by an authority, if they were provided, rather than those of their own choice? As the noble Lord has said, "Gypsies and Travellers" encompasses a broad group of people from traditional Roma to those who fancy the urge to go to a pop concert and want to claim that they are nomads who have come to rest in a farmer's field, where they cause serious problems. If the noble Lord has a solution to this very difficult problem—the noble Lord, Lord Graham, was right to point out to us that it is difficult—he would receive a great deal of support. But at the moment, I do not understand why he is so confident that that would be the case.
    Lord Avebury: I shall be delighted to answer the noble Viscount's question and at the same time address the point that was raised by the noble Baroness, Lady Hanham. A large number of Gypsies do provide their own sites and this is the way in which most of the Gypsy community would like to go. But they have not been able to do so because Circular 1/94 did not encourage local authorities to provide the necessary planning permissions, as had been hoped. This is why Gypsies are buying pieces of land in unsuitable locations up and down the country and then applying for planning permission, going all the way through the appeal system and coming into conflict with local residents.
    I am suggesting—this is the answer to the noble Baroness, Lady Hanham—that if, say, 80 per cent of Gypsies wish to develop their own sites, have the
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    means to do so and can get the planning permission—which they ought to be able to do under the new Planning and Compulsory Purchase Act because land will be designated for that purpose—there will still be a residue of perhaps 20 per cent of the Gypsy and Traveller population who do not have the means or the skills to go through the planning system, to get their own sites and to develop them. I entirely agree with my noble friend who said that smaller sites are much better than the larger ones. I hope that local authorities will take that into consideration in planning for the needs of Travellers, as they will have to do in 2005 onwards as part of the housing needs assessment.
    But what are we to do with the 20 per cent who are not able to afford their own sites? This is what I was asking the Minister to address and he said nothing about it. We will have to wait and see what the ODPM survey suggests should be done about those people.
    I agree with the noble Lord, Lord Bassam, that the Planning and Compulsory Purchase Act 2004 will be a major step forward, because there will then be within each local authority a definite number of sites and pitches that will have to be divided, in the same way as the local authorities provide for housing. But it is not said who is going to give those sites. The majority will be dealt with by the Gypsies themselves and a few may be provided by registered social landlords; but a small minority of people will not be able to afford, or do not have the skills, to go through the system as has been outlined. What we suggest is that local authorities should have a duty, as necessary, to provide or facilitate for that small minority.
    I said that I did not expect to reach a solution this afternoon, because a survey is being undertaken by the ODPM and the Select Committee has to report, which will happen in October. I hope that by the time we come back to the matter on Report we shall have both documents. In the mean time, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Avebury Lord Avebury moved Amendment No. 224:
    After Clause 186, insert the following new clause—
    "PROTECTED SITES FOR GYPSIES AND TRAVELLERS
    (1) In section 5(1) of the Mobile Homes Act 1983 (c. 34) (interpretation) for "protected site" substitute the following definition—
    ""protected site" has the same meaning as in Part 1 of the Caravan Sites Act 1968 (c. 52) except that it also includes any Gypsy and Traveller site owned or managed by a county council or a district council."
    (2) In section 5(5) of the Caravan Sites Act 1968 (c. 52) (supplementary) for "shall not apply" substitute "applies".
    (3) Section 4(6)(a) of the Caravan Sites Act 1968 (provision for suspension of eviction orders) is repealed."
    The noble Lord said: The amendment seeks to give effect to the judgment of the European Court of Human Rights, in the case of Connors v United Kingdom, about which I wrote to the Minister on 29 May. It puts Gypsies on the same footing as others

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    as regards security of tenure by reading across to Gypsy sites the relevant provisions of the Mobile Homes Act 1983.
    Briefly, Mr James Connors, a Gypsy, had been resident on the Cottingley Springs caravan site for some 15 years, apart from the short interval in 1977, when he and his family were summarily evicted, on 1 August 2000, in a five-hour operation involving police and bailiffs. The county court granted the council possession on the grounds that the family were trespassers, their permission to occupy the land having been withdrawn. From then onwards, Mr Connors and his two elder boys, Charles and Michael, who were aged 14 and 13, moved around the area in one of their caravans, staying only a couple of weeks in any one place before being moved on, while Mrs Connors separated from her husband and moved into a house with the younger children—Daniel, 10, and Thomas, four months.
    The central issue in the case was whether, in the circumstances, the legal framework applicable to the occupation of pitches on local authority Gypsy sites provided the applicant, Mr Connors, with sufficient procedural protection of his rights. The court was not satisfied that local authorities needed the flexibility allowed by the power of summary eviction in order to cope with a nomadic clientele—bearing in mind that according to the Niner report, as I have already mentioned, 86 per cent of Gypsies remained on the same site for three or more years.
    The court was not satisfied that there was any particular feature of local authority Gypsy sites that would render their management unworkable if they were required to establish reasons for evicting long-standing occupants. Analysing the absence of procedural safeguards, the court dismissed the Government's argument that judicial review was adequate for the purpose, because it could not provide an opportunity for examining the facts in dispute between the parties.
    In fact, since the local authority was not required to show any substantive justification for evicting a Gypsy from one of its own sites, there was never an opportunity for any judicial consideration of the facts that led to the eviction. The court therefore found that the eviction of Mr Connors and his family was not attended by the necessary procedural safeguards—namely, the requirement to establish proper justification for the serious interference to his right to family life, and could not be regarded as justified by a pressing social need or proportionate to a legitimate aim being pursued.
    In his response of 6 August to the letter that I wrote on 29 May, Mr Hill apologised for the long delay, but all he said was that security of tenure was being considered as part of the ODPM's policy review. If the review recommended a change in the legislation, the matter would be referred to the Law Commission's tenure review which is expected to produce its findings, together with a draft Bill, towards the end of the year.
    In fact, the Law Commission's website says that it hopes to publish its final report with a draft Bill in early 2005. That means that with the general election approaching there will probably not be time for
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    Parliament to consider such a Bill in the next Session, which may be shorter than usual and is likely to concentrate on matters considered more attractive to the electorate.
    The summary eviction powers that the European Court declared were a breach of Article 8 would then remain in force for at least 18 months after the judgment; in spite of the fact that a convenient opportunity to eliminate them in the shape of the amendment is being offered to the Government now. That would not be in accordance with the spirit of our adherence to the convention. I hope that the Minister will feel able to accept the amendment. I beg to move.
    4.30 p.m.
    Lord Lester of Herne Hill: I apologise for the fact that I spoke in support of the wrong amendment, even though I supported it. I had not realised that the amendments had been degrouped because of the importance of considering each one separately. Lawyers are terrible at matters of procedure, especially this lawyer. However, I was able to pay tribute to my noble friend Lord Avebury and I do not need to repeat what I said.
    I would like to concentrate on the obligations on the United Kingdom to give effect to the landmark judgment of the First Chamber of the European Court, which included the British judge Sir Nicholas Bratza. The decision was unanimous. The Government wisely decided not to challenge the decision by seeking to refer it to the Grand Chamber of the court.
    We have here a final and binding judgment as of 27 May. The Government have six months in order to report to the enforcement mechanism under the European Convention—that is, the Committee Ministers of the Council of Europe—on what they propose to do in order to give effect to the judgment.
    That does not mean only satisfying judgments in terms of some £30,000 in compensation, legal fees and expenses that the taxpayer will have to pay to satisfy the judgment in respect of the individual; it means also putting right the systemic failure so that other Gypsies in similar circumstances do not have to retain lawyers and bring legal proceedings in this country and then before the European Court of Human Rights.
    I know that the Government are likely to say that they will not tell the Committee what they propose to do until they have told the Committee of Ministers, which they will probably not do until 27 November, which will be after the Bill has left the House and we lose any control or influence over the matter. I very much hope that that will not be the Minister's response today for the following reasons.
    The Bill provides a perfect opportunity to implement the court's judgment with a simple amendment—I congratulate my noble friend and the Commission for Racial Equality, which authored the amendment. It is a simple way of putting right the systemic ether. It does not require the Law Commission, a possible draft Bill and a further delay—as my noble friend said—of 18 months or even longer to put the matter right.

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    It would be extremely unfortunate if other victims had to go to British courts and the Strasbourg court completely unnecessarily in order to obtain a remedy in the long term when it is Parliament's job as well as the Government's to comply with the obligations imposed on the United Kingdom by being party to the convention. I have a number of questions for the Minister; if he cannot reply to them today we shall return to the matter on Report. What is being said in this debate, and will be said in the debates on the remaining stages of the Bill, will undoubtedly be scrutinised carefully in Strasbourg by those responsible under the enforcement mechanisms. Therefore, it is not a complete waste of breath for us to debate this measure carefully at this stage and to seek answers from the Government.
    As the Joint Committee on Human Rights, to which I belong, will not meet again until 13 October—which I believe is the contemplated date for the Report stage—it will not be able to do its normal scrutinising job in time to influence what happens on Report, although I hope that certainly by Third Reading we can have the benefit of the committee's considerations.
    I should like to ask the Minister the following questions. First, have the Government approached the Law Commission to ask it to consider urgently what needs to be done in order to implement the judgment, as it plainly is urgent? If not, will they do so very soon, if the Law Commission is to be involved, although I do not see why it needs to be?
    Secondly, will the Minister confirm that the Government have an obligation under the European Convention to introduce general measures to prevent future violations in similar cases? I should have thought that must be an easy thing to answer as it is obvious.
    Thirdly, does the Minister agree that it is important for the Government to avoid the need for further unnecessary litigation by making the necessary changes? Finally—this is the most important question of all—will the Minister explain why this amendment is not tailor-made and fit for the purpose of providing a proper remedy for the systemic failures that my noble friend has already explained, and that are explained fully in the important judgment of the European Court? I very much hope that that final question can be answered today because it is the most important one at the moment as regards determining whether this amendment should have our support.
    Lord Bassam of Brighton: This clause seeks to widen the definition of a "protected site" in the Mobile Homes Act 1983 to include local authority-owned and/or managed Gypsy and Traveller sites to give security of tenure to residents; to extend the Protection From Eviction Act 1977 to those occupying caravan sites as a residence; and also seeks to give courts the power to suspend an eviction order against a resident of a local authority site.
    We have been looking at the issue of tenure on local authority sites in detail in our policy review. It is clear that security of tenure for Gypsies and Travellers is out
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    of line with that for both conventional housing and park homes. The original justification for this—that the level of security of tenure for Gypsies and Travellers was appropriate to facilitate nomadism—has much less force now than it had in the past. However, in this debate a number of Members of the Committee made the point that in some ways Gypsies constitute much more settled communities now than they have done for many, many years.
    In terms of type of resident, type of landlord and management needs, local authority Gypsy and Traveller sites share characteristics with social housing. Of course, the legislation that underpins them is different, and a great deal of further consideration would need to be given to how public sites might be brought more into line with social housing. Such a task is not possible within the timescales of the Bill.
    Furthermore, amending the Mobile Homes Act in the way suggested would have wider consequences. It would confer succession rights to the occupation agreement, allow residents to assign their occupation agreement to others, and allow local authorities to charge commission on the sale of caravans. This is another reason why the amendment is unsuitable.
    Subsection (2) of this amendment is not necessary in relation to those on protected sites under the Caravan Sites Act 1968, which includes all those on local authority-owned sites—apart from those on county council-owned sites—as this effect is already achieved by Clause 186 of the Bill. Clause 186 extends protection from harassment and unlawful eviction to those occupying caravans as a residence on a protected site. Section 3 of the Caravan Sites Act 1968, once amended by Clause 186, will offer equivalent and equal protection to those occupying caravans on a protected site as is offered to those occupying conventional housing by the Protection from Eviction Act 1977.
    I am aware, however, that there is a disparity between the status of sites owned by district councils and those owned by county councils. The former are protected sites under the Caravan Sites Act 1968, and the latter are not. We are currently considering this issue further.
    Subsection (3) of the amendment seeks to give courts the power to suspend eviction orders made against residents of local authority-owned sites. The amendment is drafted widely, as it would allow courts to suspend eviction orders in all cases where the sites were owned by a local authority, not just Gypsy and Traveller sites. However, I am happy to give this amendment some further consideration and, if appropriate, return to it on Report.
    The noble Lord, Lord Lester of Herne Hill, asked a number of questions, and I will try and respond to them as best I can. The first question he asked was whether we have approached the Law Commission. No, we have not as yet, in dealing with the specifics of the case. We need to be clear about exactly what we want. Security of tenure is obviously a complex issue and, as I think I have said already, a detailed review of that is continuing.

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    The second question the noble Lord asked was whether we are putting things in place to correct systemic problems. I think that is a very fair question. We will consider this again but, as I have said, it is not as straightforward as the noble Lord would perhaps like to assume. But we will look at this very carefully, because clearly this is part of the continuing review we have been undertaking.
    The third question related to the need to avoid litigation. Of course we agree. Yes, that is absolutely desirable. But we do want to get it right, and that is why we want to look at the social rented sector, as I said earlier in my contribution, as a comparator. I think the fourth question was probably covered in what I said earlier.
    We recognise the scale of the difficulty that the court case in particular has created. It has highlighted some very important issues. We are happy to look at elements of the amendment, because we can see there is merit in it. But we want a period of further reflection, and I think it would be useful if the noble Lord, Lord Lester, would enable us to give this some further thought and come back on Report.
    Lord Lester of Herne Hill: I am extremely grateful for the helpful and encouraging answers to my questions. I think I am right in interpreting what the Minister has said in this way: we can hope that on Report, before this Bill leaves this House, we will have an opportunity for considering another way of implementing the judgment, which will avoid, perhaps, the need for 18 months of delay with the Law Commission and further legislation. That is one very important thing. As I understand the Minister, he is indicating that that is his hope, and we, and the Government, could therefore do our job in Parliament in implementing the judgment before the end of the Session. Have I understood him correctly?
    Lord Bassam of Brighton: I would not want to be hung out to dry absolutely on the interpretation of the noble Lord, Lord Lester. I am certainly going to ensure that we address the issues that have been raised this afternoon. Whether we manage to come back with a perfected solution within the current Session is an open question. As I said, there are elements of the amendment that we want to give some further consideration to, which may go some way to meeting some of the problems that have been highlighted by the Connors case. So I know that that has qualified, perhaps, the noble Lord's rather more enthusiastic interpretation of what I said. But I do not want to mislead the Committee, and it would be quite wrong and improper of me to do so.
    4.45 p.m.
    Lord Avebury: I am grateful for the Minister's partial assurance, and would like to suggest a way forward on the matter that might commend itself to the ODPM. First, can we agree that the Connors case should be looked at separately from all the other issues that the ODPM has under review as part of its consideration of policy on Gypsies? Secondly, during
    1406
    the interval between Committee and Report, the legal experts in the CRE who assisted us in drafting the amendment should be in touch with the Minister's Bill team to see whether they can find mutually acceptable improvements in the wording.
    Thirdly, bearing in mind that only the first day of Report is on 13 October, my noble friend would be able to consider the matter in the Joint Commit tee on Human Rights on that day and still be in time for recommendations to be made to the House that could be considered when we returned to the matter on Report. With those three conditions, would be happy to withdraw the amendment, but I would be grateful for an assurance from the Minister that my suggestion about contact between the CRE's legal experts and the Bill team could be facilitated during the interval.
    Lord Bassam of Brighton: What the noble Lord says makes a lot of sense and we will happily sign up to those three practical propositions, to see what we can do with them.
    Lord Avebury: That is great. I shall mention just one other matter while I think of it. In case the Law Commission has to proceed with consideration of the matter to incorporate whatever decision is made in the draft Bill, which will be laid before the ODPM early in 2005, might it be a good idea for the ODPM to initiate some discussion with the Law Commission now? It is apprised of the matter because I have told it about it, but it would be better if some approach were made to it by the ODPM.
    Lord Bassam of Brighton: The answer is obviously yes but, as I said earlier, there needs to be further thought on exactly the basis on which we make that approach. It makes a lot of sense to work out from where we are coming to start with.
    Lord Avebury: I am grateful to the Minister. The question is simply one of timing. We do not want any unnecessary delay, because the Law Commission would say, "If you'd told us about this earlier, we might have been able to incorporate it in the draft Bill, but as we've only just heard of it we need a little more time". With that on record, I am happy to beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Baroness Whitaker Baroness Whitaker moved Amendment No. 225:
    After Clause 186, insert the following new clause—
    "OBLIGATION TO UNDERTAKE PERIODIC REVIEW OF HOUSING NEEDS
    (1) The Housing Act 1985 (c. 68) is amended as follows.
    (2) In section 8(1) (periodical review of housing needs) at the end insert "including accommodation to meet the needs of gypsies and travellers."
    (3) In section 56 (minor definitions) insert at the appropriate place—
    "Gypsies and Travellers"—
    "Gypsies" means Romany Gypsies;
    "Travellers" means—

    (a) Irish Travellers,

    1407

    (b) members of ethnic groups for whom living in a caravan is part of their traditional way of life, or

    (c) persons of nomadic habit of life, whatever their race or origin.""

    The noble Baroness said: Amendments Nos. 225 and 226 are complementary to the previous amendments—Amendments Nos. 223 and 224—and some of my concluding remarks apply also, in the round, to all of them.
    Amendment No. 225 would oblige housing authorities to include in their periodic review of housing needs those of Gypsies and Travellers. It further defines Gypsies and Travellers as the earlier two amendments did, and as the noble Lord, Lord Avebury, described, so that the definition is inclusive and does not restrict the category to where or how people have chosen to live. It is the ethnic identity which has been the subject of so much endless prejudice, and it is therefore the ethnic identity which ought to be protected.
    Amendment No. 226 amends the Housing Act 1996 to enable Gypsy and Traveller site providers to register as social landlords, and the Housing Corporation to fund such site provision and management along with its other funding purposes, as the right reverend Prelate the Bishop of Newcastle recommended earlier today. It further inserts a definition of accommodation to include accommodation to meet the needs of Gypsies and Travellers in action to deal with homelessness. The amendment would also reiterate the new definition of Gypsies and Travellers itself in that Act. The effect of those amendments would be substantially to diminish the marginalisation of Gypsy and Traveller communities, and thus in turn to enable them to play more part in community responsibilities, as my noble friend Lord Graham indicated.
    There is general acknowledgement that the kind of change made by these amendments is necessary. As the noble Lord, Lord Avebury, said, the National Farmers Union supports these new duties and powers, as do the Association of Chief Police Officers, the Local Government Association and the Commission for Racial Equality, which of course gave particular help. So does the exemplary Cottenham Residents' Association, as the noble Lord, Lord Avebury, described.
    I congratulate my noble friend the Minister on the Government's expressed intentions—the Office of the Deputy Prime Minister thinks that the authorities should assess the accommodation needs of Gypsies and Travellers; the Minister of State, my honourable friend Keith Hill, said in another place:
    "we hope to introduce a series of announcements and proposals, some of which may be incorporated in the [Housing] Bill".—[Official Report, Commons, 11/5/04; col. 276.]
    My honourable friend Yvette Cooper said:
    "We plan to extend the permissible purposes of that [Housing Corporation] money to allow local registered social landlords to provide Gypsy and Traveller sites".—[Official Report, Commons, 19/5/04; col. 1075.]
    This has been going on for some time. Over a year ago, in your Lordships' House, my noble friend Lady Scotland of Asthal said:
    "we are currently looking at ways in which to develop policy that will lead to an increase in the provision of authorised sites."
    And, of course, there is the new legal duty to promote equality of opportunity under the Race Relations Act, innovated by this Government. Most recently of all, there is my right honourable friend the Chancellor's spending review document of last July:
    "The Government will be looking to improve prospects for gypsies and travellers in the 2004 Spending Review".
    With all this support, as well as the explicit approach of the Government, it seems absolutely uncontroversial and straightforward to include provisions on the lines of these amendments in the Bill. I know the Government have said that they want to await the definitive recommendations of their own review of Gypsy and Traveller accommodation; but this Bill is the obvious vehicle for progress and another suitable vehicle may not come along very soon. If the Government mean business on all this, acceptance of these amendments would demonstrate it.
    Meanwhile, this is the reality for Tom Sweeney, co-chair of the Irish Travellers' Movement:
    "my licence states that I can be given as little as seven days' notice … This creates for me and my family a real lack of ownership in our site; we feel like we are under continual probation. Our home does not feel like a home. I have lived on my site for 14 years and been engaged in a whole range of charity and community work with bodies like the Catholic Children's Society. I have put something into the community but what has the community given Travellers like me in return?"
    Well, what has the community given him and his family and others like them in return? Shorter lives; worse health; perhaps the highest maternal death rate of all ethnic minorities; poorer educational achievements; insecurity; persecution and prejudice. Unfair treatment in housing is probably the greatest single contributor to this manifest inequality and we ought to remedy it now. I beg to move.
    Lord Avebury: One point upon which the Minister did not comment in the earlier amendment was the role of registered social landlords in providing accommodation for Gypsies and Travellers. In supporting the amendment moved by the noble Baroness, Lady Whitaker, I should like to press the Government on that matter.
    It is important to recognise that, although the vast majority of Gypsies, as I have said, may wish to provide their own sites, there are some who are unable to do so, financially or otherwise. Do the Government think that registered social landlords have a role to play in the provision of such sites? If so, have the Government had discussions with the Housing Corporation on facilitating the power of the corporation to fund the provision of sites? Have they spoken to any of the registered social landlords who are considering that kind of work?
    In particular, the Novas Ouvertures Group, operates some sites that were transferred entirely into its care by local authorities. The group has the skills to manage Gypsy and Traveller sites and is willing to do the work. It has told me over the years that, if it could

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    find a local authority that was willing to provide the land and the Housing Corporation provided the funding, the group could put schemes together. The noble Baroness, Lady Hanham, might like to know that it has discussed such schemes with a number of local authorities such as Liverpool. One might not think that Liverpool was a city with much spare land. But at least discussions were entered into with the Novas Ouvertures Group, and that might have proceeded, if the funding had been available.
    Milton Keynes is another place where there is a possible contribution to be made, because that city wishes to provide Traveller sites. If the Housing Corporation provided the funding, Novas Ouvertures' offer to build and manage the site could provide an extremely fruitful partnership. I should like the Government to promote such arrangements where there is a tripartite agreement between the Housing Corporation, the registered social landlord and the local authority, so that the three together could make such provision.
    I believe that the Housing Corporation, which says that it would be glad do this if it was allowed to, and at least one registered social landlord would be willing to be involved. Perhaps the local authorities, who know they will be faced with a duty under the Planning and Compulsory Purchase Bill, would see this as a useful way of providing high quality sites that would not attract the sort of odium that some of the unauthorised sites have attracted recently.
    Lord Bassam of Brighton: The amendment would specifically include Gypsies and Travellers in local housing needs assessments and puts forward a definition of Gypsies and Travellers. I dealt with that point earlier—to the noble Lord's satisfaction, I hope. I repeat that that is actively being considered by the Gypsy and Traveller review. We will be discussing that later in the year.
    As noble Lords may be aware, to assist local authorities in their assessment of the unique needs of Gypsies and Travellers, ODPM is updating the good practice guidance on local housing assessments that was issued to them in 2000. It will now specifically provide advice on assessing the needs of Gypsies and Travellers, setting out a baseline list of things that should be considered and recommending for the first time an appropriate methodology. That revised guidance will be in place next year. However, I am happy to consider further whether any statutory changes would be helpful, and I am happy to give a commitment that we will return to this matter on Report, if appropriate.
    Amendment No. 226 is aimed at including sites in the housing system and permitting registered social landlords to provide sites. As part of our review of Gypsy and Traveller policy, we are looking at how to mainstream Gypsy and Traveller provision in the wider housing and planning system, as I have said. We agree that for too long questions to do with the provision of sites and how they should fit in with the wider housing system have been neglected. We are now giving those questions the consideration they urgently require.
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    5 p.m.
    However, the amendment could have some extreme, perhaps unintended consequences. It would make every reference to housing and accommodation in the Housing Act 1996 also cover Gypsy and Traveller sites. There are apparently over 1,000 references to these terms, covering a wide range of housing contexts, from homelessness to houses in multiple occupation, from injunctions to the powers of the Housing Corporation, from leasehold reform to introductory tenancies. For that reason I do not consider it appropriate to make all references to housing, accommodation and housing accommodation also apply to Gypsies and Travellers. Some of them are likely to conflict with existing law covering Gypsy and Traveller sites.
    The consequences of changes affecting sites and their appropriateness need careful consideration, and that is exactly what the review is doing. I quite agree that registered social landlords should be able to provide sites for Gypsies and Travellers. To achieve this it is only necessary to extend the permissible purposes of registered social landlords. This could be best done through secondary legislation and I am happy to repeat the commitment that has already been given to that effect.
    I hope that the mover of the amendment will feel happy to withdraw, because I think that we are moving in the same direction, albeit in a slightly different way, but for very good reasons. The noble Lord, Lord Avebury, asked a question about the role of registered social landlords. Initial discussions have been undertaken with the Housing Corporation, but there have been no direct discussions with RSLs. We have committed to amending the permissible purposes of RSLs, so that they can receive grant to build sites. Those grants come from the Housing Corporation, so we are on track. Perhaps we have not travelled quite as fast and furious as the noble Lord, Lord Avebury, would like, but we are making progress.
    Baroness Whitaker: I would like to thank the noble Lord, Lord Avebury, for his very helpful contribution to this small debate and also to welcome my noble friend the Minister's announcement of improvements in the guidance, and particularly his offer to consider statutory changes. I hope that the Government will be very positive about the role of the Housing Corporation and on that basis I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 226 and 227 not moved.]
    Baroness Darcy de Knayth Baroness Darcy de Knayth moved Amendment No. 228:
    After Clause 186, insert the following new clause—
    "DISABILITY HOUSING SERVICE
    (1) The Housing Act 1996 (c. 52) is amended as follows.
    (2) In section 167(2)(d) at the end insert "or to meet their access needs".
    (3) After section 167(2E), insert—

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    "(2F) Subject to subsection (2), the scheme may contain provision for the creation of a disability housing service consisting of—

    (a) a register or database of existing or planned accessible residential properties in the local authority area, whether purpose built or adapted, with details of the access features relating to each property;

    (b) a register or database of disabled people who require accessible housing; and

    (c) a service of matching disabled people to properties so recorded.

    (2G) For the purposes of this section "accessible residential properties" means dwellings, flats and houses in multiple occupation in England and Wales which provide a reasonable means of access and ease of use for disabled people or which may easily be adapted to provide such access and ease of use.""
    The noble Baroness said: I am moving this amendment as my noble Friend Lady Wilkins is unfortunately not well. She knows a lot more about housing than I do, and any arguments that I hope that the Minister may find persuasive are hers. The amendment would do two things. First, it would place the access needs of disabled people at the heart of the allocations process. Currently disabled people may qualify as a priority for housing on medical and welfare grounds, which may help to explain why disabled people are not always treated with the level of priority that they deserve.
    More than one in five disabled people live in homes where it is either difficult to move around or to get in and out. That figure comes from a John Grooms survey in 2003. A quarter of wheelchair users face these problems, a third of disabled people in rented accommodation had to wait more than a year to be offered their home. More than one in ten had to wait more than three years. Mencap's Housing Timebomb campaign report in 2002 revealed a severe dearth of housing for people with learning disabilities. It estimated that at the current rate of provision it would take 30 years to meet the needs of people living with older parents aged 70 or over. More research by Emerson in 1996 on residential provision for people with learning disabilities demonstrates a serious shortage of alternative housing and support places outside the family home for people with a learning disability.
    Secondly, the amendment provides for local housing authorities to establish disability housing registers. Owing to the shortage of accessible housing properties, disabled people's housing options are extremely limited. Often, when a property with adaptations becomes available for letting, landlords have difficulty in identifying someone who needs it, so it may be let to someone who does not need it, or, ever worse, the adaptations may be removed from the property altogether. The amendment is designed to overcome these problems.
    A disability housing register consists of a database of accessible property, a database/register of disabled people who require accessible housing and—particularly important—a service of matching people to available property. Such services have been established in, for example, Leicestershire, Reading, Liverpool, Cardiff and
    1412
    Glasgow. The GLA is currently examining the feasibility of a London-wide register. Its initial research has found a very high level of interest from local authorities, housing associations and local organisations of disabled people.
    More and more local authorities are realising that disability housing registers are key to better planning for future housing need, a more efficient allocations policy and for supporting real choice and independent living for disabled people.
    At Second Reading on 7 June (at col. 132 of the Official Report) the noble Lord, Lord Bassam, suggested that statutory provision for DHRs would create a disproportionate burden on local authorities. That is rather surprising, given the degree of interest from authorities themselves and the amount of advice and support available from HoDis—the National Disabled Persons Housing Service—and other organisations to set up and run such schemes, together with the success of existing schemes and the major cost-savings, which can be in the region of hundreds of thousands of pounds a year.
    Along with the Disability Rights Commission, HoDis, Mencap, the RNIB, RADAR, Shelter and countless others, which I had better not mention now because we are short of time, I believe that the time has come to place disability housing registers on a statutory basis. The amendment as drafted does not impose an absolute duty on local authorities; it is discretionary. Nevertheless, I think that it would create a powerful lever to ensure that such services become the norm across the country.
    Therefore, I very much hope that the Minister will respond positively and that he may even bring forward a government amendment in time for the Report stage. If so, perhaps we could see it beforehand. I look forward to his response. I beg to move.
    Baroness Hamwee: The name of my noble friend Lady Maddock has been added to this amendment. She is sorry that she has been unable to stay for the debate. It will not improve the argument for me to repeat the points made very clearly by the noble Baroness, Lady Darcy. I shall say only that I am particularly glad to be able to support an amendment which is discretionary for local authorities. I always struggle when we ask local authorities to take on yet more duties. But I think that the noble Baroness's point about a lever is a very good one.
    I am also mildly amused that we are yet again proposing a voluntary scheme in view of the two days that we spent on the issues of compulsion and discretion in relation to another part of the Bill. I hope that the Minister will be not only sympathetic—I am sure that we shall get sympathy—but that he will ensure a real outcome on this. I am happy to be able to support the amendment.
    Lord Best: I also support the amendment moved by the noble Baroness, Lady Darcy. The Joseph Rowntree Foundation has carried out some work on accessible housing registers, so perhaps I may add one or two reasons why it may be worth the Minister supporting the amendment.

    1413
    We started work about 12 years ago in Kent, where a disabled persons' accommodation agency tested the scheme. It has now spread to other parts of the country, the work done there being picked up by HoDis—the National Disabled Persons Housing Service—with Ginnie Shaw at the helm.
    I think that this issue has become increasingly important because the housing associations and the local authorities have to meet targets in their re-letting of vacant properties. There is pressure on them to get on with the job and to do so quickly if they are not to lose points with their regulators and the people who are interested in their affairs. If they have to sit around and wait while they search for a disabled person to fill a vacancy because they are letting a property with, for example, an extension at the hack with a downstairs bathroom, they will be losing time and losing points in the great scheme of things. If there is a register that can be accessed quickly so that they can find a person for whom such an adaptation is suited, they can proceed. It will not then be necessary, as so often happens, to rip out the adaptations that have already been made and refurbish for someone with no mobility needs. Accessible housing registers are very useful in the social housing sector.
    A register would also be useful in the private sector among private landlords who, unless there is an easily accessible place, do not know where to look for a disabled tenant when they have a property that has had some adaptations made to it. Even in the owner-occupier sector, estate agencies can be drawn in voluntarily to a scheme of this kind. There are schemes in Yorkshire, Sheffield and Bradford, but I single out the one in Leeds for special praise because it has targeted the private sector. The register there includes details of homes that are on the market privately but which are suitable for disabled people.
    The system is picking up a little steam. The trouble is that it is moving rather slowly and this amendment to the Bill would give added impetus to local authorities to pursue a scheme for accessible housing registers. I commend the amendment to the Committee.
    Lord Bassam of Brighton: The Government fully appreciate and concur with the motivation behind the amendment. We recognise that it is of enormous importance that people with disabilities are housed appropriately. That is why the Government encourage local housing authorities to maintain lists of properties that are suitable for disabled people. Our code of guidance on allocations, issued in November 2002, recommends that housing authorities maintain lists of properties that are suitable for disabled people and other special needs groups. Such lists might include all accessible or significantly adapted local authority stock, RSL properties and private sector properties to which authorities nominate tenants who need to be brought within it.
    In addition to the statutory guidance, good practice guidance on disabled housing registers is also available to social landlords. A Perfect Match?, published jointly by the Housing Corporation and the National Disabled Persons Housing Service in 1999, is currently being
    1414
    updated and is designed to help spread best practice in this area and to support the creation of matching services.
    The effect of the amendment would be to require local authorities to give reasonable preference, when allocating accommodation, to people who need to move to meet their access needs. The Government agree, but that is already covered in Section 167(2)(d) which includes people who need to move on medical grounds.
    The amendment also proposes that a local authority's allocation scheme may make provision for a disability housing service. The disability housing service includes the creation of a register or database of existing or planned accessible residential properties in the local authority area, whether purpose-built or adapted, with details of the access features relating to each property, a register of disabled people who require accessible housing and a service of matching disabled people to properties so recorded.
    The Government have a number of difficulties with what is proposed. The Government repealed the duty to maintain a housing register in the Homelessness Act 2002. Nevertheless, local authorities still have the power to maintain registers and our code of guidance on allocations explicitly recognises that local authorities may want to continue to keep registers of applicants.
    As I have already said, the code also encourages local authorities to maintain lists of social housing properties that are suitable for disabled people. That approach was taken because we believe that, if a local authority has a choice about keeping a register, then it should be included in statutory guidance rather than in primary legislation. We believe that local authorities should be able to decide what registers they keep and what should be on those registers. The amendment is too prescriptive as it describes in detail what should be kept on those registers, including information that is clearly not relevant to a local authority's statutory functions.
    The Government are of the view that the best approach to matching services is to let applicants bid for properties under a choice-based letting scheme. Such schemes provide for information to be available on each property, including the extent of any adaptations, allowing those with disabilities to select appropriate housing at the time of its availability. We have set a target that all local authorities will have adopted a choice-based letting scheme by 2010.
    5.15 p.m.
    There are likely to be significant cost implications to a local authority should it decide to set up a disabled housing service, as proposed in the amendment. It is also unclear how local authorities would obtain the information required by the registers, other than the information being voluntarily provided. Verification of that information would involve carrying out expensive and comprehensive stock condition surveys.

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    I would like to give some assurance that, in terms of new housing, we are also taking action in a variety of ways to increase the supply of housing accessible to people with a disability. All newly built homes are required to comply with Part M of the building regulations. Those provisions are expected to enable occupants to cope better with reduced mobility and live longer in their own home. The Government require that all schemes funded through the Housing Corporation comply not only with the building regulations but with additional criteria for accessibility. Our reform of the planning system also seeks to introduce a statutory requirement for those responsible for preparing regional spatial strategies and local development documents in England to undertake those functions with the objective of contributing to the achievement of sustainable development.
    Our consultation draft, Planning Policy Statement 1, makes it crystal clear that development plans should contain clear and comprehensive inclusive access policies. Not only are we taking action to improve accessibility in relation to new developments, but we have substantially increased government resources available to fund adaptations to the existing stock to meet the needs of disabled people. The disabled facilities grant programme provides funding for local authorities to help disabled homeowners and tenants to pay for essential adaptations to their home. Since 1997, government funding for disabled facilities grants has nearly doubled, rising to £100 million a year. This year, over 33,000 homes will be adapted to meet the needs of disabled people through the programme, a 50 per cent increase on 1997–98.
    The voluntary approach is the best one—it enables choice. We have committed, and are committing, substantial resources to ensure local authority stock is better in terms of disabled access, and a lot of progress has already been made. Many valuable and important local initiatives have been adopted by local housing authorities and the registered social landlords sector. So, while I appreciate the import and value of the Amendment and the encouragement it generally provides, it is probably not the best way forward at this stage.
    Baroness Darcy de Knayth: I thank the noble Baroness, Lady Hamwee, for her support, and for underlining the fact that the register would be discretionary, so that local authorities would not be concerned about that aspect. I also thank my noble friend Lord Best for his informed support, and if the Joseph Rowntree Trust, with all its experience, feels a register would help enormously, I am prepared to go with that. As I said, housing is not my thing. I thank the Minister for his reply. He said that medical grounds were already mentioned. That is the whole point—we want the social model of disability, not the medical one. If "access needs" are mentioned, the disabled person's profile is raised, and their requirements are more widely known, which is important. He said the register might be expensive, but there is a great deal of information and support from
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    HoDis and others, and many authorities have introduced a register and felt that it was a good thing. I appreciate the money that has been spent on housing for disabled people, but then, as my noble friend Lord Best pointed out, a register would save people time in finding a suitable property that had been adapted. A register would be extremely valuable. I mean that, even though I come completely new to this; I am enthused.
    If the Minister cannot say "Yes" at the moment, or if he will be busy at his party conference—something from which Cross-Benchers are gloriously exempt—perhaps his officials and ours could pursue the matter further to try to make a little progress before Report.
    Lord Bassam of Brighton: I am not the policy holder in this matter, but I understand the point being made. In my experience as a politician, much of my caseload related to housing, so I am not unfamiliar with the problems that can be encountered by people who need homes with better disabled access and so on. Occasionally, I was frustrated by the fact that, although stock had been adapted, it had perhaps been wrongly allocated. My noble friend Lord Rooker and I are happy at least to reflect on the comments made today and to see what more can be done.
    Baroness Darcy de Knayth: I am very grateful to the Minister. I did not mean to imply that he did not understand or that he was not sympathetic. I know that the noble Lord, Lord Rooker, is too. I thank him very much for that little glimmer of light; perhaps the door is open a chink. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Baroness Darcy de Knayth Baroness Darcy de Knayth moved Amendment No. 229:
    After Clause 186, insert the following new clause—
    "CONSENT FOR PHYSICAL ALTERATIONS TO PREMISES FOR DISABLED PEOPLE
    (1) The Disability Discrimination Act 1995 (c. 50) is amended as follows.
    (2) After section 24 there is inserted—
    "24A ALTERATIONS TO LET PREMISES AND PREMISES TO LET
    (1) This section applies where—

    (a) a disabled person occupies premises under a lease or is considering taking a letting of the premises;

    (b) but for this section, he would not be entitled to make a particular alteration to the premises or to the access and approach to the premises; and

    (c) the alteration is one which he proposes to make in order to—

    (i) enable him to enjoy the premises;

    (ii) enable him to make use of any benefit or facility, which by reason of the letting is one of which he is entitled to make use;

    (iii) facilitate his enjoyment of the premises or his making use of any such benefit or facility;

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    (iv) enable him to become a person to whom the premises are let; or

    (v) facilitate his becoming a person to whom the premises are let;

    but would be of little or no practical use to him or if he were neither a person to whom the premises are let nor an occupier of them or if he were not considering taking a letting of the premises.

    (2) Except to the extent to which it expressly so provides, the lease shall have effect by virtue of this subsection as if it provided—

    (a) for the disabled person to be entitled to make the alteration with the written consent of the lessor;

    (b) for the relevant disabled person, or someone acting on his behalf to have to make a written application to the lessor for consent if he wishes to make the alteration;

    (c) if such an application is made, for the lessor not to withhold his consent unreasonably; and

    (d) for the lessor to be entitled to make his consent subject to reasonable conditions.

    (3) Regulations may make provision—

    (a) as to circumstances in which it is, or as to circumstances in which it is not, reasonable for a lessor to withhold his consent, and

    (b) as to conditions which it is always, or conditions which it is never, reasonable for a lessor to impose.

    (4) In this section—
    "lease" includes a tenancy, sub-lease or sub-tenancy and an agreement for a lease, tenancy, sub-lease or subtenancy; and
    "sub-lease" and "sub-tenancy" have such meaning as may be prescribed.
    (5) For the purposes of this section, premises shall be treated as let to a person where they are a commonhold unit of which he is a unit-holder; and "commonhold unit" and "unit-holder" in relation to such a unit, have here the same meaning as in Part 1 of the Commonhold and Leasehold Reform Act 2002.""
    The noble Baroness said: Amendment No. 229 is probing—but perhaps more of a prodding amendment, as I hope that the Minister will agree to take the issue forward. The Joint Committee on the Draft Disability Discrimination Bill followed the Disability Rights Task Force in recommending that the forthcoming Bill should include specific provisions preventing landlords and management committees unreasonably refusing consent to disabled people who need to make physical changes to their properties, including communal areas, in order to enjoy fundamental rights of access. Some 17,000 disabled tenants living in unsuitable accommodation report that they have been prevented from making essential alterations or adaptations because their landlord has refused consent.
    The committee asked whether adequate provisions existed in current housing and land law, as the Government claim, to address the problem. The resounding reply from the Disability Rights Commission, the Law Society and housing associations was "No". So it looked at the matter in great detail and found that the existing provisions were over-complex, partial and unenforceable. For instance, at present, the right to make alterations in many leases will be confined to the actual premises leased, so a totally accessible flat may be of little use if you have to negotiate a short flight
    1418
    of steps to get in. Even if the lease permits you to make reasonable adaptations to the property itself, there is no statutory guidance on the weight to be attached to the disabled person's access needs as opposed to the property interests of others. Decisions in other areas of land law are not encouraging.
    Current law also fails to deal with the common and desperate situation where a disabled person is ready to buy a leasehold flat or home and cannot gain consent from the management company to make alterations, often relating to getting to and through their own front door. Management companies can turn down requests for the flimsiest of reasons because there is no clear statutory guidance.
    While the Housing (Scotland) Act 2001 protects disabled tenants in social housing from landlords withholding consent unreasonably, disabled tenants in England and Wales are not afforded the same protection. The Landlord and Tenant Act 1927 does not apply in England and Wales, if the lease is silent on the issue of alterations or improvements, or if it contains an absolute prohibition against them. It applies only if there is a clause in a lease making the carrying out of improvements conditional on the landlord's consent.
    In sum, the current provisions are a nightmare for disabled people and landlords alike, and there is no example of a disabled person successfully using them to enforce a right to make reasonable adaptations. Quite why the Government feel that they suffice is unclear.
    The amendment would operate like the existing provisions in the Disability Discrimination Act, which enable service providers and employers to approach their landlords to make reasonable adjustments to their property. The reasonableness criteria, which would need to be expanded upon in regulations, would give greater clarity and ensure a better balance between the rights of disabled people and those of landlords.
    A small pub or shop may now have to pay to make an adjustment for one visit by a disabled person under the DDA. A person living in his own home has no rights at present even to pay for his own adjustments. I stress that the amendment does not require any landlords to finance alterations.
    The Disability Rights Commission would also be empowered to issue guidance and support disabled people to bring cases—something they cannot do under housing or land legislation.
    I appreciate the need not to overload the statute book with unnecessary regulation, but in this case, all parties would benefit from new provisions in disability rights legislation. I hope that the Minister can give an encouraging response and that he will see that his department gives this further thought in relation to the new disability Bill. I beg to move.
    Baroness Hamwee: Again, the Liberal Democrat Front Bench supports this amendment. It may be probing, it may be prodding—perhaps it could be prompting.
    Lord Bassam of Brighton: This is an interesting amendment. It could, I suppose, be considered for the

    1419
    draft Disability Discrimination Bill, which is already being considered by the joint parliamentary scrutiny committee. The Government have already published their response to a report by that committee, in which a similar proposal was made. I am afraid that what I have to say now is therefore a reflection of that response.
    Amendment No. 229 seeks to put landlords under a duty not to refuse consent unreasonably if a disabled person, whether a tenant or occupier, or a disabled person intending to become a tenant, wants to make an alteration to the physical features of a property that they are renting or proposing to rent. The consent must be given and may be subject to reasonable conditions. The reasonableness of a refusal or of the conditions that may be imposed may be the subject of secondary legislation.
    It is rather odd that the amendment would enable a person who has not yet rented the premises to have a right to make alterations—that is one of its defects. Of course, the amendment would allow the landlord to impose reasonable conditions when giving any consent. Even so, this highlights some rather difficult contractual arrangements that would need to be carefully considered. They would have to be considered against the limited security of tenure that tenants in the private rented sector have and the fact that turnover in that sector is of the order of 40 per cent per annum.
    The amendment is also silent on how the costs of such alterations are to be met. Perhaps it is envisaged that this could be catered for by secondary legislation. However, I think it is important that we address costs, because that is the issue on which the effectiveness of any such provision must rest.
    In response to a similar proposal for the draft Disability Discrimination Bill, we have said that it provides no new rights to replace those that currently exist. For council tenants and Rent Act tenants, these are provided under the Housing Acts 1980 and 1985. For private tenants there is, of course, the Landlord and Tenant Act 1927.
    The 1927 Act provides that landlords should not unreasonably withhold licence or consent to the making of improvements by a tenant, notwithstanding any express provision to the contrary in the lease. However, the 1927 Act does not go on to make clear provisions for costs. It says that the landlord may require, as a condition of such licence or consent, the payment of a reasonable sum in respect of any damage or diminution in the value of the premises or any neighbouring premises belonging to the landlord, and of any legal or other expenses properly incurred in connection with such licence or consent.
    The Act also allows the landlord, in the case of an improvement which does not add to the letting value of the holding, to require an undertaking on the part of the tenant to reinstate the premises.
    I can see that the financial side of any licence or consent that may have been made under the 1927 Act is likely to be little used. But I do not see that the
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    amendment addresses that or necessarily makes any new provision that should displace it. It therefore needlessly duplicates the provisions of the earlier legislation.
    I am sorry that my response is somewhat negative, but I am not sure Ciat this is the right way to proceed with this issue. I think that there are fundamental flaws in the amendment which need to be addressed before any progress can be made in this respect.
    5.30 p.m.
    Baroness Hamwee: If flaws in the amendment represent one of the hurdles that needs to be overcome, it would be helpful to hear what the flaws are so that technical alterations might be made.
    Baroness Darcy de Knayth: I thank the noble Baroness, Lady Hamwee, for her initial prompting and support and for the suggestion that she has just made. I thank the Minister for his reply, which was not very encouraging.
    The tenant can pay costs. It would be reasonable to make consent contingent on the disabled person covering the cost of reinstatement if that were necessary. Reinstatement would be less likely if one had the register anyway, because a landlord might be able to let the property to another suitable user.
    We must look into the claim that 1927 Act does not apply. That is a serious issue. That claim was also made in the Government's response. There is clearly not a meeting of minds. Land and house law are not clear. I have said that decisions in other areas of land law are not encouraging. Those decisions suggest that very little weight will be attached to the desirability of facilitating access for disabled people and their interests will be easily overridden. In Drury v McGarvie, for instance, it was held that badly constructed gates did not amount to an obstruction of a disabled person's right of way across farmland to his home, because they would not have constituted a material inconvenience for a person of average strength and agility or the ordinary, able-bodied adult.
    If that kind of decision is going to be applied to someone who can get into an accessible flat, but that flat has a flight of steps up to it, we will not get very far. As the noble Baroness, Lady Hamwee, said, perhaps the Minister's officials, the DRC and other officials could meet to thrash out the issue and construct a viable amendment to the disability rights Bill.
    Lord Bassam of Brighton: I always want to be as helpful as I can with these issues and perhaps that is a suggestion that we can pursue. I am not sure that the approach in the legislation is the right one. I offer that as genuine advice.
    Baroness Darcy de Knayth: I thank the Minister for that reply. He may be right. I hope that we can succeed in the end. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Baroness Hanham Baroness Hanham moved Amendment No. 229A:
    After Clause 186, insert the following new clause—
    "PERMANENTLY MOORED SERVICED RESIDENTIAL HOUSEBOATS
    The provisions of Chapter 3 of Part 6 of this Act (mobile homes) shall apply equally to permanently moored serviced residential houseboats."
    The noble Baroness said: What seems an eon ago, we were discussing park homes. Amendment No. 229A would extend the protection and safeguards that we have just discussed for residents of park homes to residents of permanently moored, serviced houseboats.
    I stress the words "permanently moored" and "serviced" because there has been much correspondence relating to interfering with navigation on the waterways. Those boats are moored on permanent moorings and they do not move. To all intents and purposes, they are permanent accommodation on water.
    At Second Reading, we were delighted that the Government accepted that the provisions for mobile homes could be extended to houseboat residents and we believed that we had won a famous victory, which would be quickly confirmed in Committee—only to find that it was a Pyrrhic victory. The fastest U-turn in history took place, via a letter from the noble Lord, Lord Rooker, which stated that the acceptance by the noble Lord, Lord Bassam, of our case was a mistake. We were enormously grateful to the noble Lord when he accepted the view that he might have indulged in some wishful thinking. The Bill is an appropriate vehicle by which the matter can be resolved.
    It is an important issue. I readily admit that it has arisen because of the concerns of residential boat dwellers in Cheyne Walk and the Royal Borough of Kensington and Chelsea, where I am an elected councillor. However, clusters of permanently moored houseboats appear across the country and there is no—or none that I could find—legislation or existing statutes which are germane to their situation. They have no protection in law, which is exactly the same situation that is now being addressed for mobile home owners. The houseboat owners who have briefed me have had an inordinate amount of discussion with the Port of London Authority, which licenses the moorings' owners and has not been particularly bothered or concerned by the problem; Defra, which has now concluded that it is not the right department; and the ODPM. Each of these has managed to pass the buck.
    This amendment may not precisely do the trick but we must not let the opportunity of the Bill pass without finding a way of dealing with these dwellers, who appear to be outside every form of protection and legislation and who are vulnerable to abuse of their right to live in and enjoy their residence free from harassment and fear of eviction. If the Minister cannot accept our thoughts today, then I ask him to enable his lawyers during the coming Recess weeks to meet those who seek to have these matters rectified and to come up with an answer that will do it.
    I tried to put down a much longer amendment, which would have laid out the conditions and regulations for the relationship between the moorings'
    1422
    owners and the moorers but, at that stage, I could not overcome the obstacle of the Clerks, who felt it was not appropriate. At Second Reading, Members on all sides of the House recognised that there was a problem. There is an opportunity now to put it right. I beg to move.
    Baroness Hamwee: I put my name to this amendment. I, too, was frustrated over what amendment should be tabled and, indeed, before we started the Committee stage I tried to establish whether we should be seeking an amendment to the Long Title of the Bill as I thought that it might be raised as an obstacle against extending the provisions of the Bill to houseboats and houseboat owners. There was the inevitable circular discussion because it depended on what we wanted to do within the Bill.
    Be that as it may, we talked yesterday about the public's views of politicians. It is something that we talk about from time to time in a rather self-deprecating fashion. I am sure we all think, "That does not quite apply to all politicians and I am one of the exceptions". In this House, we are in danger of confirming the sense of helplessness that non-politicians must have. The noble Baroness has referred to what happened at, and immediately after, Second Reading. I know that the Minister has certainly had one, and I am sure far more than one, letter from a houseboat owner. I shall quote from it because I would like to see the words of a houseboat owner quoted in this context. I am aware of the time, so I am not going to take very long:
    "I am sure you can imagine the sense of enormous disappointment among residential houseboat owners that just when it looked as if the injustices they have suffered for so many years were to be put right you are apparently going to overturn this at the last minute.
    "Throughout the discussions a number of us have had with politicians from all parties and with senior civil servants we have always received total support for the case we have been putting forward".
    It always seems to me that problems that affect one's own home must be experienced particularly intensely. They are with one all the time. Therefore, for Opposition Members of your Lordships' House not yet to have found a way to persuade the Government that for the Office of the Deputy Prime Minister to refer the people involved to Defra and for Defra to tell them that it is a matter for the Office of the Deputy Prime Minister leaves us wondering what we can do to get bits of government not just to talk to one another but to find a solution to a very real problem.
    Baroness Miller of Chilthorne Domer: I should like to underline the first point made by my noble friend Lady Hamwee that this problem has been going on for a very long time. I was a houseboat owner at the end of the 1970s and 1980s. I am glad to say that my landlord—the 3rd Osterley Sea Scouts—being a charity, actually treated its houseboat tenants very well. But I am aware of a number of cases where that was not the case, and not only up and down the Thames. I believe that the noble Baroness, Lady Hanham, referred to the houseboat dwellers of Chelsea.

    1423
    At the end of the 1980s, the Select Committee in the other place took extensive evidence from a resident houseboat owner on the Cheshire Ring. I know that others gave evidence too, when they were examining waterways issues, of the sort of harassment that can happen. Houseboat owners—all sorts of dwellers—are particularly vulnerable. It is very easy to cut hosepipes, and to loosen ropes. I do not need to catalogue the sorts of harassment that can happen, because Members of the Committee can probably imagine it. But the time must have come for the Government to address the matter, and this seems the perfect Bill in which to do so. I welcome the amendment.
    Lord Rooker: I am not sure which amendment the noble Baroness was speaking to—Amendment No. 229A or 229B—because it is the latter that deals with harassment. However, I might as well refer to that amendment, as it is only a couple of paragraphs. The Protection from Harassment Act 1997 is not limited to residential occupiers of any particular type but extends to members of the public generally. To that extent, it must include houseboat owners, so Amendment No. 229B is unnecessary. I cannot speak as a lawyer on a particular case, and only the courts could give a definitive view, but the Protection from Harassment Act 1997 covers the general public, so it must cover houseboat owners.
    On Amendment No. 229A, the substantive amendment, I would like to get a certain matter out of the way. A genuine mistake occurred on Second Reading. Let us not make a big fuss about it—it was a genuine mistake which I corrected immediately. We did not give anyone a false impression; I do not want anyone to argue that we lied or misled them. It was a genuine mistake at the Dispatch Box, and we corrected it straightaway.
    The amendment would give the same rights as apply to park home occupiers to residential houseboat occupiers. Currently, the rights of residential houseboat occupiers will depend, first, on the terms of the agreement with the owner of the mooring—so there is an issue there. Secondly, it will depend on the terms of the agreement between the occupier and the owner of the houseboat, because they could be different people.
    There is no statutory security of tenure, and the relationship between the parties is dependent on the terms of their own contractual arrangements. The normal rules of contract law will apply, along with the Unfair Terms in Consumer Contracts Regulations 1999, which is policed by the Office of Fair Trading. The proposed amendment would not in fact provide the security of tenure desired by houseboat owners.
    There is currently no statutory security of tenure relating to houseboats. The amendments in the Bill for park homes consist of amendments to the Mobile Homes Act 1983 and the Caravan Sites Act 1968. To apply the clauses to houseboats as well would be meaningless, because these Acts do not apply to houseboats.
    It is the department's view that houseboat residents are already covered by the Protection from Eviction Act 1977. This has two main consequences: first, that
    1424
    occupiers are protected from unlawful eviction and harassment and, secondly, that possession can occur only after an order for possession from a court has been obtained. That is the general view; on the specifics, as Members of the Committee must understand, it would be down to the case in court.
    We are aware of worries about the adequacy of the law relating to houseboats, and we are currently in discussion with our colleagues at both the Department for Transport and the Department for Environment, Food and Rural Affairs, who lead on policy involving British Waterways and the Port of London Authority. Notwithstanding what has been said here today, we are in discussion with those two departments.
    5.45 p.m.
    Security of tenure of houseboats is a complex issue. Someone said to me that they are effectively parked on the highway. I have a list of different kinds of moorings that I could read out. It is amazingly complicated. As a result of the discussions, DEFRA has commissioned a scoping study on how the issues can be effectively dealt with. That will provide an opportunity to establish the size and scope of the issue and identify any necessary legislative change, for which we can then press.
    If we accepted the amendment now we would be giving houseboat owners ill-considered legislation, because it does not apply to them. We have made provision for park home owners in other Acts of Parliament that do not apply. I do not know anything about one department passing the buck to the other; I am giving the Government's considered view. We are in discussion with colleagues in both DEFRA and the Department for Transport and the study commissioned by DEFRA will aim to satisfy the problems identified.
    Baroness Hanham: The trouble is that the right hand does not know what the left hand is doing. The reason why I separated Amendments Nos. 229A and 229B was specific: I needed the Minister's categoric assurance—which he has now given—that the Protection from Eviction Act 1977 covered those resident on permanently moored houseboats. The reason I asked for the assurance and tabled a question—I did not know which would come first—is because council and legal opinions have varied. I am aware of a case where a definitive answer matters urgently. I am grateful to the Minister for his explanation that the Act applies.
    Regarding Amendment No. 229A, these discussions have been going on an inordinately long time with people passing the matter on. The Minister says that he does not know anything about it, but I can assure him that departments have been involved one after another and one after the other have said that they have no role. The DEFRA role is on waterways. These people are permanently moored. The Minister almost made the case that they were parked on the highway, but actually they are parked on the sidelines of a highway.

    1425
    We cannot move them; if we move them they will sink. They have flowerpots and so on all around them. They are to all intents and purposes permanent residents.
    They are not covered by the Housing Acts, however we look at it, which is what they need. I do not think that they are looking for statutory security of tenure but the recognition that they can be covered by the Housing Acts for all intents and purposes. That is what we need to consider. I accept that my amendment is inappropriate. When I read the preceding clauses on mobile homes I realised that it was not appropriate, but it was the only way I could get the issue into the Bill. I wanted to propose longer clauses, which would have explained the whole matter, but they were not allowed. Now I will have to try to get my new clause back in on Report.
    It would be helpful if the ODPM lawyers would talk to permanently moored houseboat owners, which they may be starting to, because they are distinctly left out of any legislation. It is obvious that this is the legislation to get provisions into. We have about three-and-a-half weeks before Report stage and I hope we might be able to conduct some discussions that would tell us how to get appropriate amendments into the Bill. In the meantime I thank the Minister for his reassurance about the Protection from Eviction Act and the Protection from Harassment Act 1997. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 229B and 229C not moved.]
    Clause 187 agreed to.
    Baroness Hanham Baroness Hanham moved Amendment No. 230:
    After Clause 187, insert the following new clause—
    "ENERGY EFFICIENCY: IMPROVEMENTS IN ENERGY EFFICIENCY
    (1) For the purposes of—

    (a) improving the energy efficiency of residential accommodation;

    (b) increasing the comfort level of occupants of residential accommodation; and

    (c) alleviating fuel poverty,

    the Secretary of State shall take reasonable steps to ensure an increase in residential energy efficiency of at least 20% by 2010 based upon 2000 levels.
    (2) In this section—
    "fuel poverty" has the same meaning as in the Warm Homes and Energy Conservation Act 2000 (c. 31); and
    "residential energy efficiency" means the energy efficiency of residential accommodation."
    The noble Baroness said: I have pruned enormously what I was going to say on the remaining amendments so I hope that we can scramble through them.
    The target of a 20 per cent improvement in energy efficiency by 2010 was first set by the Conservative government in 1996 under the Home Energy Conservation Act. Then the target was 30 per cent by 2010, but 30 per cent from 1996 is almost the same as 20 per cent based on 2000 levels. For years that target was accepted by this Government.
    The 20 per cent improvement based on 2000 levels is just another way of saying that the target is the saving of 5 megatonnes of carbon from domestic energy efficiency by 2010. A recent publication from the Association for the Conservation of Energy explains in detail the 15 categorical assurances given to the industry that the Government were committed to achieving the 5 megatonnes of carbon savings from domestic energy efficiency specified in the White Paper. Six assurances were given by four separate government Ministers, including two in this House by the noble Lord, Lord Whitty, and by the Permanent Secretary at the DTI and by the Treasury. That is all very specific.
    In the event, on 26 April the Government abandoned all those assurances and set the target as the saving of 4.2 megatonnes of carbon by 2010—a reduction of 16 per cent—in their energy efficiency implementation plan. Given this explanation I hope that the Government will lend their support to Amendment No. 230 today to ensure that the aim is increased to the original 20 per cent figure. I beg to move.
    Lord Redesdale: I rise to speak to Amendment No. 230ZA standing in the name of my noble friend Lady Maddock. I wish to speak briefly also to Amendment No. 230 with which it is grouped as that is an extremely good amendment. However, I should add one small caveat; namely, if all the new builds that took place met the required energy efficiency standards and builders did not cut corners, an enormous amount of energy efficiency would be gained. One of the major problems in this country is that there are not enough building inspectors to ensure that all the new builds match the guidelines set out. It would be helpful if something could be done about that. I plan to bring forward an amendment at a later stage of the Bill to prompt the Government on that issue.
    Amendment No. 230ZA seeks to deal with the issues of efficiency and fuel poverty. One way of doing that is to provide an alternative source of energy than electricity and gas from the grid. One of the major problems connected with fuel poverty is that many people are not connected to the gas main and therefore have to purchase power sources that are extremely expensive in order to keep warm. Many tried and trusted technologies could be installed. The two areas considered in the amendment are micro combined heat and power and domestic heat pumps.
    Domestic heat pumps will be fairly difficult to install except in new builds. However, there are alternatives not mentioned in the amendment such as photovoltaics and solar heating panels which could be installed on almost any building in the country and would significantly cut the amount of electricity and heat energy required by many people in this country.
    One of the reasons for raising this issue is that there is a small problem of joined-up government. As was mentioned earlier, the introduction of many of these technologies requires an up-front capital cost which many people would find difficult to meet. Grants are available. However, those grants are made available

    1427
    by the DTI not by the ODPM. That seems to be one of the major problems with the two schemes. The ODPM introduced this Housing Bill but the DTI should have had a lot of input in terms of government strategy on renewable energy sources.
    My specific area of concern was mentioned by the Prime Minister. We are pumping out a large amount of carbon through inefficient energy resources such as boilers. It is unfortunate that the Prime Minister should mention that aspect, which I agree is important, but at the same time the clear skies grant is being cut from the amount that was available two years ago to a much more insignificant sum at present.
    If the Government really are serious about cutting carbon emissions and increasing renewables such as photovoltaics and micro-combined heat and power, they are going to have to increase the amount of money available. The amendment refers simply to a strategy, but this is an area that we feel very strongly about and which the Government are going to have to take seriously and fund in the short term.
    Lord Rooker: Coming back to energy, Amendment No. 230 would place an obligation on the Secretary of State to take reasonable steps to ensure an increase of at least 20 per cent in residential energy efficiency by 2010. I am not going to bandy statistics, but I should point out that the existing aim set out in the energy efficiency plan of action—it was only published in April this year—to secure an annual carbon saving from the UK household sector of approximately 4.2 million tonnes by 2010, is indeed broadly equivalent to the 20 per cent improvement sought through this amendment. Furthermore, the Government's existing aim allows for the flexibility of review and, if necessary, an increase in the aim.
    We are already doing a great deal to improve energy efficiency in the residential sector. Key to this is our determination to implement the decent homes standard, with its commitment to ensuring good standards of heating and insulation, and in that way supporting the Government's drive towards the elimination of fuel poverty. I will have more to say about that when I come to Amendment No. 232.
    The Government strongly believe that there should be a commitment to a level of carbon savings from domestic energy efficiency. We already have a mechanism for giving effect to that commitment: the Sustainable Energy Act 2003, under which my right honourable friend the Secretary of State for the Environment, Food and Rural Affairs published an energy efficiency aim for England in the energy efficiency plan of action earlier this year. That makes provision for a review of the commitment, and that is the sensible approach to setting the targets. In other words, the place for doing that is the Sustainable Energy Act 2003, and not this Bill. It is a more appropriate vehicle. We are not going soft on the issue, believe me.
    The noble Lord, Lord Redesdale—I cannot resist this—waxes lyrical about the Department of Trade and Industry. I thought this was the department his
    1428
    party wants to abolish to get all the savings. Of course, we know that if they were abolished, all their work would be spread around Whitehall, so there would be nothing like the savings we have heard being pontificated about. Now I have caused myself a problem, because he has got up to intervene.
    Lord Redesdale: I was dealing with the reality that the DTI is in existence and they are the ones who deal with the Clear Skies scheme, an excellent scheme which I hope the Minister will look into. The point I was trying to get across was that the DTI is spending a pitiful amount on that scheme, which is the main thrust for renewables. If we are serious about renewables, perhaps we could get rid of the DTI and use the entire budget on renewables. I would be very happy if he would agree with that this evening.
    Lord Rooker: The point—
    Baroness Miller of Chilthorne Domer: I am sorry to interrupt the Minister, but I need to point out that the Clear Skies project, which the Minister undertook to look into, has been reduced in grant, as my noble friend Lord Redesdale says. One of the issues is that one can claim the grant only if one uses one of the registered installers. That is a condition of the grant. However, when you go to the Clear Skies website and look up the list of registered installers, all you get is a box with a cross through it. So, in fact, you cannot use the registered installers, because you cannot see who they are. Then the DTI will claim not many people are taking up the grant, and therefore the demand for it has dropped so less money will be put in. I simply say this to illustrate that all is not well.
    Lord Rooker: Absolutely, and I will certainly be happy to come back to this on Report. In respect of Amendment 230ZA, my noble friend Lord Bassam of Brighton reminded me that if noble Lords cast their minds back to before the Summer Recess, they will recall how the House saw a great deal of debate on the Energy Bill. I sat in on a few days myself, muttering under my breath. There are worries about security of supply and such matters, and the Prime Minister addressed some of these issues the other day. The Energy Act includes a duty for the Secretary of State to publish a strategy for the promotion of micro-generation in Great Britain. In drawing up the strategy, the Government will consult fully with interested parties inside and outside government.
    6 p.m.
    Because I had met its representatives at a fair of offsite housing manufacturers, in July I visited the largest such housing site in Britain, with more than 1,000 dwellings planned and under construction. There will be people living in houses there before the end of the year. When I went there to what was, in effect, the exhibition, nothing was finished; I am not saying that it was that far advanced. However, what was interesting was that I saw for myself an example of

    1429
    micro-generation of electricity, which is what they want to use in the dwellings. It was the first time that I had seen that.
    Things are under way; it is true that they are in new dwellings with offsite manufacturers using modern methods of construction, which of course are far more efficient in terms of energy than traditional wet methods. There is work to be done, but I would be more than happy to come back on Report, because I am going to get some advice about one department not knowing what the other is doing, and about a website that invites people to have a look at it but does not give proper information. I shall find out more about the Clear Skies policy.
    Baroness Hanham: Because we have been sitting for so long, I shall not prolong the agony of this amendment. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 230ZA not moved.]
    Clause 188 agreed to.
    Lord Rooker Lord Rooker moved Amendments Nos. 230A and 230B:
    Before Schedule 8, insert the following new schedule—
    "NEW SCHEDULE 5A TO THE HOUSING ACT 1985: INITIAL DEMOLITION NOTICES
    "SCHEDULE 5A

    INITIAL DEMOLITION NOTICES
    Initial demolition notices
    1 (1) For the purposes of this Schedule an "initial demolition notice" is a notice served on a secure tenant—

    (a) stating that the landlord intends to demolish the dwelling-house or (as the case may be) the building containing it ("the relevant premises"),

    (b) setting out the reasons why the landlord intends to demolish the relevant premises,

    (c) specifying the period within which he intends to demolish those premises,

    (d) stating that, while the notice remains in force, he will not be under any obligation to make such a grant as is mentioned in section 138(1) in respect of any claim made by the tenant to exercise the right to buy in respect of the dwelling-house.

    (2) An initial demolition notice must also state—

    (a) that the notice does not prevent—

    (i) the making by the tenant of any such claim, or

    (ii) the taking of steps under this Part in connection with any such claim up to the point where section 138(1) would otherwise operate in relation to the claim, or

    (iii) the operation of that provision in most circumstances where the notice ceases to be in force, but

    (b) that, if the landlord subsequently serves a final demolition notice in respect of the dwelling-house, the right to buy will not arise in respect of it while that notice is in force and any existing claim will cease to be effective.

    (3) If, at the time when an initial demolition notice is served, there is an existing claim to exercise the right to buy in respect of the dwelling-house, the notice shall—

    (a) state that section 138C confers a right to compensation in respect of certain expenditure, and

    (b) give details of that right to compensation and of how it may be exercised.

    (4) The period specified in accordance with sub-paragraph (1)(c) must not—

    (a) allow the landlord more than what is, in the circumstances, a reasonable period to carry out the proposed demolition of the relevant premises (whether on their own or as part of a scheme involving the demolition of other premises); or

    (b) in any case expire more than five years after the date of service of the notice on the tenant.

    Period of validity of initial demolition notice
    2 (1) For the purposes of this Schedule an initial demolition notice—

    (a) comes into force in respect of the dwelling-house concerned on the date of service of the notice on the tenant, and

    (b) ceases to be so in force at the end of the period specified in accordance with paragraph 1(1)(c),

    but this is subject to compliance with the conditions mentioned in sub-paragraph (2) (in a case to which they apply) and to paragraph 3.
    (2) The conditions in sub-paragraphs (6) and (7) of paragraph 13 of Schedule 5 (publicity for final demolition notices) shall apply in relation to an initial demolition notice as they apply in relation to a final demolition notice.
    (3) The notice mentioned in paragraph 13(7) (as it applies in accordance with sub-paragraph (2) above) must contain the following information—

    (a) sufficient information to enable identification of the premises that the landlord intends to demolish,

    (b) the reasons why the landlord intends to demolish those premises,

    (c) the period within which the landlord intends to demolish those premises,

    (d) the date when any initial demolition notice or notices relating to those premises will cease to be in force, unless revoked or otherwise terminated under or by virtue of paragraph 3 below,

    (e) that, during the period of validity of any such notice or notices, the landlord will not be under any obligation to make such a grant as is mentioned in section 138(1) in respect of any claim to exercise the right to buy in respect of any dwelling-house contained in those premises,

    (f) that there may be a right to compensation under section 138C in respect of certain expenditure incurred in respect of any existing claim.

    Revocation or termination of initial demolition notices
    3 (1) Paragraph 14(4) to (7) of Schedule 5 (revocation notices) shall apply in relation to an initial demolition notice as they apply in relation to a final demolition notice.
    (2) If a compulsory purchase order has been made for the purpose of enabling the landlord to demolish the dwelling-house in respect of which he has served an initial demolition notice (whether or not it would enable him to demolish any other premises as well) and—

    (a) a relevant decision within sub-paragraph (3)(a) becomes effective while the notice is in force, or

    (b) a relevant decision within sub-paragraph (3)(b) becomes final while the notice is in force,

    the notice ceases to be in force as from the date when the decision becomes effective or final.
    (3) A "relevant decision" is—

    (a) a decision under Part 2 of the Acquisition of Land Act 1981 to confirm the order with modifications, or not to confirm the whole or part of the order, or

    (b) a decision of the High Court to quash the whole or part of the order under section 24 of that Act,

    where the effect of the decision is that the landlord will not be able, by virtue of that order, to carry out the demolition of the dwelling-house.
    (4) A relevant decision within sub-paragraph (3)(a) becomes effective—

    (a) at the end of the period of 16 weeks beginning with the date of the decision, if no application for judicial review is made in respect of the decision within that period, or

    (b) if such an application is so made, at the time when—

    (i) a decision on the application which upholds the relevant decision becomes final, or

    (ii) the application is abandoned or otherwise ceases to have effect.

    (5) A relevant decision within sub-paragraph (3)(b), or a decision within sub-paragraph (4)(b), becomes final—

    (a) if not appealed against, at the end of the period for bringing an appeal, or

    (b) if appealed against, at the time when the appeal (or any further appeal) is disposed of.

    (6) An appeal is disposed of—

    (a) if it is determined and the period for bringing any further appeal has ended, or

    (b) if it is abandoned or otherwise ceases to have effect.

    (7) Where an initial demolition notice ceases to be in force under sub-paragraph (2), the landlord must, as soon as is reasonably practicable, serve a notice on the tenant which informs him—

    (a) that the notice has ceased to be in force as from the date in question, and

    (b) of the reason why it has ceased to be in force.

    (8) If, while an initial demolition notice is in force in respect of a dwelling-house, a final demolition notice comes into force under paragraph 13 of Schedule 5 in respect of that dwelling-house, the initial demolition notice ceases to be in force as from the date when the final demolition order comes into force.
    (9) In such a case the final demolition notice must state that it is replacing the initial demolition notice.
    Restriction on serving further demolition notices
    4 (1) This paragraph applies where an initial demolition notice ("the relevant notice") has (for any reason) ceased to be in force in respect of a dwelling-house without it being demolished.
    (2) No further initial demolition notice may be served in respect of the dwelling-house during the period of 5 years following the time when the relevant notice ceases to be in force, unless—

    (a) it is served with the consent of the Secretary of State, and

    (b) it states that it is so served.

    (3) Subject to sub-paragraph (4), no final demolition notice may be served in respect of the dwelling-house during the period of 5 years following the time when the relevant notice ceases to be in force, unless—

    (a) it is served with the consent of the Secretary of State, and

    (b) it states that it is so served.

    (4) Sub-paragraph (3) does not apply to a final demolition notice which is served at a time when an initial demolition notice served in accordance with sub-paragraph (2) is in force.
    (5) The Secretary of State's consent under sub-paragraph (2) or (3) may be given subject to compliance with such conditions as he may specify.
    Service of notices
    5 Paragraph 15 of Schedule 13 (service of notices) applies in relation to notices under this Schedule as it applies in relation to notices under paragraph 13 or 14 of that Schedule.
    Interpretation
    6 (1) In this Schedule any reference to the landlord, in the context of a reference to the demolition or intended demolition of any premises, includes a reference to a superior landlord.
    (2) In this Schedule—
    "final demolition notice" means a final demolition notice served under paragraph 13 of Schedule 5;
    "premises" means premises of any description;
    "scheme" includes arrangements of any description.""
    Before Schedule 8, insert the following new schedule—
    "PROVISIONS RELATING TO TENANCY DEPOSIT SCHEMES
    Schemes to be custodial schemes or insurance schemes
    1 (1) A tenancy deposit scheme must be either—

    (a) a custodial scheme, or

    (b) an insurance scheme.

    (2) A "custodial scheme" is a scheme under which—

    (a) tenancy deposits in connection with shorthold tenancies are paid to the landlords under the tenancies,

    (b) amounts representing the deposits are then paid by the landlords into a designated account held by the scheme administrator, and

    (c) those amounts are kept by the scheme administrator in that account until such time as, in accordance with the scheme, they fall to be paid (wholly or in part) to the landlords or tenants under the tenancies.

    (3) An "insurance scheme" is a scheme under which—

    (a) tenancy deposits in connection with shorthold tenancies are paid to the landlords under the tenancies,

    (b) such deposits are retained by the landlords—

    (i) on the basis that, at the end of the tenancies, such amounts in respect of the deposits as are agreed between the tenants and the landlords will be repaid to the tenants, and

    (ii) subject to the landlords undertaking that, if (in the absence of any such repayments being made to tenants) amounts in respect of the deposits are paid to the tenants by the scheme administrator, the landlords will reimburse those amounts to the scheme administrator in accordance with directions given by it, and

    (c) insurance is maintained by the scheme administrator in respect of failures by landlords to comply with such directions.

    Provisions applying to custodial and insurance schemes
    2 (1) A custodial scheme must conform with the following provisions—
    paragraphs 3 and 4, and
    paragraphs 7 and 8.
    (2) An insurance scheme must conform with the following provisions—
    paragraphs 5 and 6, and
    paragraphs 7 and 8.
    Custodial schemes: general
    3 (1) This paragraph applies to a custodial scheme.
    (2) The scheme must provide for any landlord who receives a tenancy deposit in connection with a shorthold tenancy to pay an amount equal to the deposit into a designated account held by the scheme administrator.
    (3) The designated account must not contain anything other than amounts paid into it as mentioned in sub-paragraph (2) and any interest accruing on such amounts.
    (4) Subject to sub-paragraph (5), the scheme administrator may retain any interest accruing on such amounts.
    (5) The relevant arrangements under section (Tenancy deposit schemes)(1) may provide for any amount paid in accordance with paragraph 4 to be paid with interest—

    (a) in respect of the period during which the relevant amount has remained in the designated account, and

    (b) at such rate as the appropriate national authority may specify by order.

    (6) With the exception of any interest retained in accordance with sub-paragraph (4), nothing contained in the designated account may be used to fund the administration of the scheme.
    (7) In this paragraph "the relevant amount", in relation to a tenancy deposit, means the amount paid into the designated account in respect of the deposit.
    Custodial schemes: termination of tenancies
    4 (1) A custodial scheme must make provision—

    (a) for enabling the tenant and the landlord under a shorthold tenancy in connection with which a tenancy deposit is held in accordance with the scheme to apply, at any time after the tenancy has ended, for the whole or part of the relevant amount to be paid to him, and

    (b) for such an application to be dealt with by the scheme administrator in accordance with the following provisions of this paragraph.

    (2) Sub-paragraph (3) applies where the tenant and the landlord notify the scheme administrator that they have agreed that the relevant amount should be paid—

    (a) wholly to one of them, or

    (b) partly to the one and partly to the other.

    (3) If, having received such a notification, the scheme administrator is satisfied that the tenant and the landlord have so agreed, the scheme administrator must arrange for the relevant amount to be paid, in accordance with the agreement, within the period of 10 days beginning with the date on which the notification is received by the scheme administrator.
    (4) Sub-paragraph (5) applies where the tenant or the landlord notifies the scheme administrator—

    (a) that a court has decided that the relevant amount is to be paid either wholly to one of them or partly to the one and partly to the other, and

    (b) that decision has become final.

    (5) If, having received such a notification, the scheme administrator is satisfied as to the matters mentioned in sub-paragraph (4)(a) and (b), the scheme administrator must arrange for the relevant amount to be paid, in accordance with the decision, within the period of 10 days beginning with the date on which the notification is received by the scheme administrator.
    (6) For the purposes of this Schedule a decision becomes final—

    (a) if not appealed against, at the end of the period for bringing an appeal, or

    (b) if appealed against, at the time when the appeal (or any further appeal) is disposed of.

    (7) An appeal is disposed of—

    (a) if it is determined and the period for bringing any further appeal has ended, or

    (b) if it is abandoned or otherwise ceases to have effect.

    (8) In this paragraph "the relevant amount" has the meaning given by paragraph 3(7).
    Insurance schemes: general
    5 (1) This paragraph applies to an insurance scheme.
    (2) The scheme must provide that any landlord by whom a tenancy deposit is retained under the scheme must give the scheme administrator an undertaking that, if at the end of the tenancy any amount in respect of the deposit is paid to the tenant by the scheme administrator in accordance with paragraph 6(5), the landlord will reimburse that amount to the scheme administrator in accordance with directions given by it.
    (3) The scheme must require the scheme administrator to effect and maintain in force adequate insurance in respect of failures by landlords by whom tenancy deposits are retained under the scheme to comply with such directions as are mentioned in sub-paragraph (2).
    (4) If the scheme provides for landlords participating in the scheme to be members of the scheme, the scheme may provide for a landlord's membership to be terminated by the scheme administrator in the event of any such failure on the part of the landlord.
    (5) The scheme may provide for landlords participating in the scheme to pay to the scheme administrator—

    (a) fees in respect of the administration of the scheme, and

    (b) contributions in respect of the cost of the insurance referred to in sub-paragraph (3).

    Insurance schemes: termination of tenancies
    6 (1) An insurance scheme must make provision in accordance with this paragraph in relation to the respective obligations of the landlord and the scheme administrator where—

    (a) a tenancy deposit has been retained by the landlord under the scheme, and

    (b) the tenancy has ended.

    (2) If the tenant and the landlord agree that the whole or part of the deposit should be repaid to the tenant, the landlord must repay the amount in question ("the agreed amount") to the tenant within the period of 10 days beginning with the date on which the agreement is made.
    (3) Sub-paragraph (5) applies where the tenant notifies the scheme administrator that—

    (a) there has been such an agreement as is mentioned in sub-paragraph (2), but

    (b) the agreed amount has not been repaid within the period mentioned in that sub-paragraph.

    (4) Sub-paragraph (5) also applies where the tenant notifies the scheme administrator that—

    (a) there has been no such agreement as is mentioned in sub-paragraph (2), but

    (b) a court has decided that the tenant is entitled to the whole or part of the deposit ("the due amount"), and

    (c) that decision has become final (see paragraph 4(6) and (7)).

    (5) If, having received such a notification as is mentioned in sub-paragraph (3) or (4), the scheme administrator is satisfied—

    (a) as to the matters mentioned in sub-paragraph (3)(a) and (b), or

    (b) as to the matters mentioned in sub-paragraph (4)(a) to (c),

    the scheme administrator must pay to the tenant an amount equal to the agreed or due amount within the period of 10 days beginning with the date on which the notification is received by the scheme administrator.
    (6) Where the scheme administrator pays any such amount to the tenant, he must direct the landlord to reimburse that amount to the scheme administrator within the period of 10 days beginning with the date on which the direction is received by the landlord.
    (7) The landlord must comply with such a direction.
    (8) The scheme must make provision for preventing double recovery by a tenant in respect of the whole or part of the deposit, and may in that connection make provision—

    (a) for excluding or modifying any requirement imposed by the scheme in accordance with any of sub-paragraphs (5) to (7), and

    (b) for requiring the repayment of amounts reimbursed.

    (9) In sub-paragraph (8) "double recovery" means recovering both an amount from the scheme administrator and an amount from the landlord in pursuance of a court order made against him.
    Notifications to tenants
    7 (1) Every custodial scheme or insurance scheme must provide for the scheme administrator to respond as soon as is practicable to any request within sub-paragraph (2) made by the tenant under a shorthold tenancy.
    (2) A request is within this sub-paragraph if it is a request by the tenant to receive confirmation that a deposit paid in connection with the tenancy is being held in accordance with the scheme.
    Dispute resolution procedures
    8 (1) Every custodial scheme or insurance scheme must provide for facilities to be available for enabling disputes relating to tenancy deposits subject to the scheme to be resolved without recourse to litigation.
    (2) The scheme must not, however, make the use of such facilities compulsory in the event of such a dispute.
    Power to amend
    9 The appropriate national authority may by order make such amendments of this Schedule as it considers appropriate."
    On Question, amendments agreed to.
    Schedule 8 agreed to.
    Clause 189 agreed to.
    Clause 190 [Additional power to give grants for social housing]:
    Lord Rooker Lord Rooker moved Amendment No. 230C:
    Page 144, line 37, leave out "companies that are not" and insert "persons other than"
    The noble Lord said: In moving the amendment, I shall speak to the others in the group, which are almost identical except for one that leaves out lines 18 to 25 on page 146. As drafted, Clause 190 would allow the relevant authority to pay grants to companies other than registered social landlords for essentially the same housing purpose as for which they make grants to registered social landlords. For the purpose of the clause, "company" means a company registered under the Companies Act 1985 and ALMOs—that is, arm's-length management organisations.
    This group of amendments would broaden the range of organisations eligible to receive grant. We have listened to arguments from the Opposition in the other place, and do not wish to exclude any potentially suitable providers. The amendments would mean that persons eligible to bid for grant would no longer be restricted to companies as defined under the Companies Act 1985 or arm's-length management organisations. The amendment would allow the Housing Corporation to pay grant to "persons", as defined in the Interpretation Act 1978. That would include a body of persons corporate or unincorporate.
    The amendment would prevent situations from occurring where, for example, a joint venture between developers established as a company would qualify for grant, but a limited liability partnership joint venture between the same development partners would not. We still believe that a requirement for applicants to be registered companies would provide some additional assurances on their viability. However, the amendments will not mean that unsuitable persons will now be able to be allocated grant. I want to make that absolutely clear.
    The Housing Corporation will be expected to make sure that only fit and proper persons receive funding. The reassurances that we want about the suitability of bodies can be sought in other ways—for example, as part of the corporation's "due diligence" work. These amendments would also bring the clause into line with general European Union policy, which seeks to avoid discrimination on the constitutional status and geographical basis of organisations.
    The intention behind Amendments Nos. 230D and 231F appears to be to widen the range of bodies to which the Housing Corporation can pay grant. Frankly, the amendments that we have tabled are similar, taking into account the concerns raised in previous debates. However, the amendments of the noble Lord, Lord Best, would seek to place more restrictions on the definition of an eligible body than the Government are proposing. They would prevent government and governmental bodies, contracting authorities or individuals from applying. It is unlikely that many of the bodies excluded by these amendments would submit a bid. For example, the Public Services Contract Regulations include such bodies as national museums, tribunals and rent assessment panels.
    However, the noble Lord, Lord Best, is right—I understand that this is a key concern and one we share—to be concerned that only suitable persons should receive the grant. But we think that that can be achieved without placing the restrictions on who is able to bid for the grant. I beg to move.
    The Deputy Chairman of Committees: If I may make an apology to the noble Lord, Lord Best, I should have mentioned to the Committee that if Amendment No. 230C is agreed to I would not be able to call Amendment No. 230D, but of course he can speak to it now.
    Lord Best: I am entirely satisfied with the amendment in the name of the Minister and I shall not move Amendment No. 230D and Amendment No. 231F which goes with it.
    On Question, amendment agreed to.
    [Amendment No. 230D not moved.]
    Baroness Miller of Chilthorne Domer Baroness Miller of Chilthorne Domer moved Amendment No. 231:
    Page 145, line 18, at end insert—
    "() The proportion of grants awarded to companies in rural areas shall be in proportion to the percentage of the population living in such areas."
    The noble Baroness said: We talked at length earlier about the needs of rural areas, so I will not go back into those arguments that the noble Lord, Lord Bassam, replied to. This amendment seeks to make sure that the inevitable economies of scale that urban areas enjoy do not mean that an enormous proportion—disproportionate to the population—of the proposed grant goes only to urban and suburban areas, leaving rural areas to lose out, as they have done in the past.
    I have had a projection from the Rural Housing Trust, which is the leading developer of small schemes of affordable housing in villages in England—that is, settlements of fewer than 1,500 people. The trust has been working with such villages since 1976. Since that time it has produced nearly 3,000 units of accommodation in 300 villages spread over 33 counties. It works at a small and appropriate scale for the size of village it works in, down to as few as two or three in an area such as Studland in Dorset, for example, where there is no such thing as affordable housing even for people earning probably £100,000 a year. If you are on a normal salary it would be hopeless. So three affordable houses in that area were really meaningful.
    The trust's projection—which I want to bring to the attention of the Minister—is that over the next few years 8,000 small villages will need 50,000 new homes. That is in quite small settlements of under 1,500. I am very anxious that an innovative grant such as this is not going to make rural areas lose out. I beg to move.
    Lord Hylton: I support the spirit of the amendment and do so as someone who, about 34 years ago founded a fairly small—now almost medium-sized—rural village housing association. Had that not been done, the village where most of the houses owned by the association stand, would almost certainly have been totally gentrified and passed beyond the means of the local inhabitants—the sons and daughters of local residents.
    I might add that our last housing association scheme took five to seven years from start to completion due to shortage of funds, planning difficulties, other housing associations going bankrupt and numerous other problems. The Committee will realise that this is extremely uphill work. I recommend to the Government the point made by the amendment. I do not necessarily expect them to adopt it as it stands, but could we at least be told that the policy of the Housing Corporation will be in accordance with the sense of the amendment? That would be of great benefit.
    Lord Rooker: I could almost say, "yes" to both speeches. We are completely at one regarding the intention of both the noble Baroness and the noble Lord. I make no bones about that. I do not wish even to be nit-picking about the amendment, but, as it is drafted, it could have a perverse effect if there was only one application in terms of percentages of bids—for example, if there was a poor bid that did not stack up. But that is not the thrust of the amendment. The thrust is so that the small settlements and rural hamlets do not lose out on what we hope is an innovative scheme for providing social housing in another direction.
    1438
    I want to reassure the Committee that funding for affordable housing will be allocated in line with the priorities identified through the regional housing strategy process. But it must not be forgotten that part of that process is that regional housing boards must ensure that they have engaged with rural stakeholders and that the final product has been rural-proofed.
    When I was Minister for Housing—Keith Hill now holds that post—we were visited by Alun Michael and his associates from Defra to ensure that our policies and their practical operation were rural-proofed. We already have a programme for small settlements below 3,000 involving the Housing Corporation; but I take on board what the noble Baroness said regarding the smaller ones. We would not want them to be missed out of this innovative scheme. Obviously, business cases will have to be put forward; but the main thrust is that this is not an urban policy, but a national housing policy.
    A quarter of the population of the country lives in non-urban, rural areas—millions of people living in small hamlets, small villages and towns. We do not want them and their families driven out due to a lack of affordable housing. We are very keen to address that. We have stepped up the Housing Corporation programme only slightly, but we have stepped it up. We want to ensure that those areas also share in the new policy.
    Baroness Miller of Chilthorne Domer: I thank the Minister warmly for his good reply, and I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Lord Best Lord Best moved Amendment No. 231A:
    Page 145, line 21, at end insert ", to include measures to ensure—

    (a) that tenants of homes built under subsection (2)(d) are afforded the same protection as tenants of registered social landlords in respect of—

    (i) legal rights;

    (ii) terms and conditions of occupancy;

    (iii) rent levels;

    (iv) bankruptcy of landlord or managing agent;

    (v) recourse to the Independent Housing Ombudsman;

    (b) that all recipients of grant under subsection (2) are subject to the same regulation in respect of—

    (i) disposal of land or property which has been the subject of grant;

    (ii) accountability for the use of grant;

    (iii) requirements to repay or recycle grant."

    The noble Lord said: I know that the hour is somewhat late, but with the surprise of having this sitting of the Committee on a Thursday and having

    1439
    cancelled engagements in Oxford and York to be here, I am afraid that I shall detain noble Lords for a short while on the amendment.
    This is concerned with the intentions of Clause 190 to award to other bodies the social housing grant, and other grants which have hitherto been available to only registered social landlords—principally to private sector house builders. The issues here were not the subject of debate in the other place and I am glad, therefore, that this discussion accords with the views of the Minister that debates in this Chamber are most valuable when they pick up on new and original issues not previously debated. I remind your Members of the Committee of my earlier declaration of interest as chief executive of a registered social landlord, the Joseph Rowntree Housing Trust. I have been involved with the measures surrounding grants to housing associations and regulation of housing associations for well over 30 years.
    6.15 p.m.
    The object for the Government in taking the power to make grants to bodies that are not registered social landlords—in other words, not housing associations—is to increase competition, so that the amount of money available for social housing can be made to go further. Plans have already been announced for setting aside £200 million from next year's funds for housing associations, for which house builders and other developers will be able to compete.
    If Clause 190 were to remain as it is in the Bill, my contention is that the medium to long-term consequences of this measure would be higher costs to the taxpayer, poorer outcomes for tenants and local communities, and consequently a deterioration in the public perceptions and acceptability of new housing for lower income households. I suspect that the only benefits would be very short-term, superficial savings, which all concerned would regret later on.
    At present, when the Housing Corporation decides on the bodies to which it should award social housing grants, it has considerable choice. Today's housing associations compete fiercely with one another for the available grants and bids far exceed the resources available. Indeed, some have argued that this competition can be too intense, putting pressure on housing associations to cut corners. Certainly, the housing associations making bids invariably expect to operate at a loss for each new development for many years, because the rents they will receive will not match the outgoings in repaying loans and managing and maintaining the property.
    However, the established housing associations can cover the losses by drawing on the surpluses they obtain from properties that they developed 10 or 20 years earlier, where rents will have risen while mortgage payments will have remained relatively constant, or indeed where mortgages have been fully repaid. My own housing association, for example, has debt-free properties built 50 and even 100 years ago.
    Private sector house builders or developers would of course find it much more difficult to carry losses for several years, because they do not have a pool of older properties where rental income achieves surpluses. So why would house builders wish to move away from the building of homes for sale and embark upon provision of social housing for rent or even provision of shared ownership housing, which is partly for rent and partly for ownership? Very few have a cash flow that would make it easy for them to suffer deficits for several years, even if they are predicting long-term capital gains in the more distant future. Even fewer have any experience in providing rented homes for families on low incomes, with all the specialist skills that this implies.
    However, there are circumstances in which direct provision of rented housing would suit the house builders. It is likely to be a condition of planning consent for all new developments that some social housing is provided. Of course, if social housing grants are available, normally there will be plenty of housing associations willing to take on the social rented provision so that house builders can perform their usual function of developing a site, selling and moving on to the next, without the ongoing commitments and hassles of owning any rented stock.
    Partnerships between house builders and housing associations are now the order of the day and the two parties are learning how best to operate these partnerships successfully. The Joseph Rowntree Foundation has published a couple of reports on ways in which contractual relationships between house builders and housing associations can work to best effect. The great majority of house builders will much prefer to continue with current arrangements.
    There are, however, occasions when house builders can find no housing association that wishes to work with them in taking on the rented element required by the planners. My housing association, the Joseph Rowntree Housing Trust, has turned down approaches from house builders because their plans have been unacceptable. Builders have wanted us to produce rented homes in a segregated part of their site, even with a separate access, in the worst position—for example, as a barrier between the owners and a noisy road or next to the gas works. We would refuse to be involved if we could not provide the rented homes "pepper-potted" across the site, avoiding the stigma of separate social housing, which can completely undermine the social purposes of a new development. With direct access to social housing grants, house builders might think that they could get away with practices that most housing associations would find deplorable. But I hope that the Housing Corporation would take a robust view and refuse to pay grant in any such cases.
    The other circumstance in which house builders might feel that the only way they can satisfy the conditions for planning consent and draw the usual profits from the housing for sale is where the local authority is seeking a higher proportion of social housing than the housing associations feel they can achieve with the funds available. Although house builders want to keep the element of social housing—

    1441
    from which no profits are likely—to a minimum in order to get the whole development through the planning system, they may have to offer a higher proportion of affordable homes than the housing associations will attempt. What form would the efficiency gains take that would allow the profit-making house builders to produce more homes than the not-for-profit registered social landlords? Since the income that they will receive from rents will be the same, they will have to make the savings by reducing ongoing expenditure. They could do that if their costs for managing the property were lower than for housing associations, but exactly the reverse is likely, as they will have to engage private managing agents willing to take on social housing or, more likely, find housing associations willing to do the management for them. They will then have to add 17.5 per cent VAT—a tax which housing associations managing the homes themselves do not pay.
    Nor are house builders likely to save money by borrowing at lower interest rates than housing associations. House builders cannot offer security on other properties in the way that housing associations, with a stock of older homes, can command. All the major housing associations borrow on highly competitive terms because the risks in lending to them are so low. So far, although housing associations have borrowed some £40 billion, lenders have never lost money.
    The construction costs of an identical building are unlikely to be lower whether the homes are built for a housing association or a developer or house builder—unless, that is, the latter is prepared to accept lower standards, and that is where the problem lies. The Housing Corporation specifies scheme development standards, and assurances from the Minister make it clear that naturally the same standards, on paper, would apply to house builders seeking grants. But there is a wide variation in how the same product is produced—for example, in relation to the quality of all the components, from door handles to roofs.
    As the Minister makes clear in the helpful notes that he has provided on the clause, building for rent requires a more robust construction than building for sale. Homes for rent will be fully occupied from day one, while the homes for sale will have spare rooms, and a new house purchaser is much more likely to have the resources and inclination to engage in constant DIY repair work than the tenant, and so the rented home must withstand greater wear and tear. Later costs will be borne by the landlord and not the occupier if component parts wear out. Over the life of a property, a cheaper initial article will cost more, but the Housing Corporation cannot be expected to measure accurately the life-cycle costs at the outset without fully inspecting all the properties on site being developed by private sector house builders in a way that is currently quite unnecessary.
    Housing associations that have bought properties off the peg from house builders—properties that, of course, comply with the Housing Corporation scheme development standards—have discovered that they bring problems over the medium to longer term and
    1442
    they have discovered the true cost in higher maintenance costs. Important work on that issue, carried out for housing associations at the University of Dundee, has increased our understanding of the importance of the more robust construction of rented homes. Housing associations are in for the long haul and they know that they will regret it later if they try to make savings in the short term, just to secure grants in a competitive situation.
    Moreover, I fear that those short-term savings—where the bid from the house builder is preferred over that of the registered social landlord—will be only the beginning of the problems caused by Clause 190. After the homes are built, and irrespective of higher maintenance costs that are likely to emerge, there is a range of other disadvantages in giving public money to unregulated profit-making companies.
    The Minister has indicated that appropriate parts of the regulations currently applying to housing associations would be applied equally to other bodies that obtain grants. Those requirements would be enforced under the terms of the grant. In so far as that goes, the Minister's comments are very reassuring and very helpful, but in two respects I fear that the deal secured from the house builder, compared with that provided through the housing association, will be very inferior.
    First, there are obligations on housing associations which it would seem impossible to require from unregulated providers. Secondly, in respect of those requirements which are imposed on house builders or other non-RSLs, it would seem virtually impossible for the regulator of the Housing Corporation to enforce compliance. Examples of the former relate to the roles that housing associations play beyond the simple management and maintenance of the homes that they own. They need to provide extra support to vulnerable tenants to tackle anti-social behaviour and to create extra communal and social facilities; they employ welfare rights and advice workers; they ensure tenant participation in decision making; and they often participate with other agencies in the support for renewal of a whole neighbourhood.
    A house builder providing a few rented homes here and there cannot be expected to take on all these other functions. Although I entirely accept the assurances of the Minister that grants will be given to house builders only on condition that all the basic legal requirements for tenants are covered, that is only part of the story in terms of what society receives from supporting registered social landlords. The tenants of unregulated new landlords will not benefit from all the extra welfare and social input that they could expect from a housing association landlord.
    The second half of those anxieties relates to the difficulties for the Housing Corporation in enforcing those conditions that are written into the original grant; for example, the corporation periodically requires housing associations to upgrade the standards of the homes that they built some years before. Currently, housing associations have to invest in

    1443
    properties so that they can reach new decent homes standards. In future properties will need to achieve a higher version of those standards.
    Although the rents from any single scheme may not be sufficient to achieve surpluses to fund such upgrading, the housing associations can still pay for the improvements by pooling the surpluses from their older stock. How will the private developers and house builders feel about finding the funds later for such upgrading and what happens if they have not set aside sufficient to undertake even the predictable major repairs that are bound to become necessary? Without the regular regulatory inspections from the Audit Commission, to which housing associations are subject, how will the Housing Corporation keep tabs on what happens to the properties and their occupiers as the years go by?
    Meanwhile, in the private sector there will undoubtedly be the usual mergers, takeovers and bankruptcies and the corporation will constantly need to be stepping in to ensure that the terms of the original grant continue to be enforced. That sounds like an expensive and, in some cases, doomed task which contrasts with the ongoing oversight of the regulated, registered social landlords.
    My final, and in some respects my most severe criticism of the proposed measure, relates to the difficulties that will be encountered in capturing the equity appreciation in the grant-aided properties if and when they are sold in the years to come. I recall the Notting Hill Housing Trust buying and modernising homes in north Kensington in the 1970s for £25,000 per house. Those same houses are now worth 100 times that sum—over £2 million. All that increase in value is held within the not-for-profit social housing sector. If the Notting Hill Housing Trust sells a property, the proceeds will be re-used for the social purposes of the trust. It is not helpful simply to say that the original grant must be repaid. In my Notting Hill example, that grant might have represented £20,000, leaving over £2 million as equity appreciation that is, capital gains for the owner.
    I realise that the Minister would like the terms of the original grant to ensure that the whole of the capital gains to the house builder can be recycled for social purposes, which is right, but it will be extraordinarily difficult to guarantee that outcome years from now. There is a real danger that the equity in subsidised property, which has made today's housing associations strong and financially secure and enabled them to undertake a range of important social functions, will not be captured where grants are paid to profit-making companies.
    6.30 p.m.
    Since I have been unable to say anything positive about the clause, except to express appreciation to the Minister for making it clear that some of the more extreme concerns about its implementation would be moderated by important conditions in the terms of grant aid, it might seem my purposes would be better
    1444
    served by arguing that the clause should not stand part of the Bill. That proposition, put forward by the noble Baroness, Lady Hanham, and the noble Lord, Lord Hanningfield, may be the safest option, but I recognise that there are some rare circumstances where grants can justifiably go to bodies that are not registered social landlords. Some charities might be keen to perform in a similar way to RSLs, and might not want to register with the Housing Corporation because they have only one or two small projects in mind and wish to avoid the full regulatory weight that registration would bring. There are the arm's-length management organisations the Minister mentioned, established by local authorities, which may seek social housing grants for new work. With these so-called ALMOs, the property remains in the ownership of the council, the organisations have a public service ethos and "good landlordism" can be expected, even though there is no registration with the Housing Corporation. There may be other worthy examples to accommodate such special circumstances, although I doubt there will be many.
    The clause could be preserved with amendments that gave legal weight to the Government's intentions that a level playing field be created for non-registered social landlords, as for the registered social landlords. Amendment No. 231A seeks to enshrine in law a requirement that each of the key rights that apply to tenants in the homes of registered social landlords and the key elements of the regulation of social landlords are applied equally when non-RSLs provide the new subsidised homes. Even though I fear the enforcement of those measures will be difficult, they will provide a modicum of reassurance if grants for social housing are to be given to unregistered, unregulated private companies. I beg to move.
    Baroness Hanham: I apologise for the fact that I did not hear everything the noble Lord, Lord Best, said. Like him, I had to go out and cancel an engagement.
    We will not oppose the Question whether Clause 190 shall stand part of the Bill, because, from what I heard, the noble Lord, Lord Best, covered all the points that I would have made. I agree with what he said—this clause gives cause for extreme concern. We will listen to the Minister's answers to the noble Lord's amendments, but we will need to unpick this a bit more on Report.
    Baroness Hamwee: The amendment also stands in the name of my noble friend, but I could not add anything.
    Lord Rooker: I was not planning to reply to the Question that the clause stand part anyway, given what I am about to say. The noble Lord, Lord Best, has done a detailed demolition job on the clause, and I understand why. I will have to respond to him in kind, if only so that we can have a sensible debate. I do not mean that the debate is not sensible, but we need to have debates on Report in the knowledge of the Government's view of the points the noble Lord

    1445
    raised. Let me put it this way: a government who are legislating on housing and do not listen to the noble Lord, Lord Best, are asking for trouble.
    Amendment No. 231A would put on the face of the Bill a requirement for the Housing Corporation to ensure that tenants of non-registered social landlords were given the same protection as tenants of registered social landlords (RSLs). The Government wish to ensure an equality of outcome for residents, tenants and prospective tenants of RSLs and non-RSLs. However, the amendment would unnecessarily restrict the Housing Corporation's flexibility to shape a competition and to amend conditions in the light of experience. It is also unnecessary—this is my fallback because it is the key area—given the order-making power that the Secretary of State will have to ensure that any key risk areas, such as the interests of prospective and actual tenants or occupiers, are addressed.
    We would expect the Housing Corporation to ensure, through grant conditions, equivalent standards of management by non-registered social landlords to those provided by registered social landlords, subject to the regulatory code. That would include expectations about equality of opportunity, rent levels, consultation with tenants, maintenance, security of tenure and accepting nominations from local authorities.
    In addition, the corporation is looking at ensuring, through grant conditions, that appropriate sections of the Charter for Housing Association Applicants and Residents will also apply to non-registered social landlords. Those are likely to include: written tenancy agreements, succession rights, information about rents and service charges, repair and maintenance services, and complaints handling, including referral to the Independent Housing Ombudsman.
    Amendment No. 231A would also put in the Bill a requirement for the Housing Corporation to ensure that non-RSLs were subject to the same regulation in respect of disposal of property, use of grant and recycling of grant. We believe that that does not take into account some fundamental differences between RSLs and non-RSLs.
    When an RSL sells a property, it is allowed to reinvest any surplus according to its own permissible purposes and must reinvest the grant for social housing within three years or refund it to the Housing Corporation. That works because the regulatory system controls the use of grant and surpluses, and because registered social landlords have specific social purposes. These statutory arrangements do not translate well to commercial profit-distributing organisations so we believe that the Housing Corporation will have to address in conditions how receipts should be reinvested or, more likely, how they should be refunded to the corporation for it to recycle.
    We recognise that that is a crucial value-for-money issue. It is not our intention that funds will be unfairly lost for reinvestment in social housing. The Housing Corporation is looking at ways of ensuring that the benefit of the equity growth in property is retained by government or recycled for social housing purposes.
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    The Government will in any case keep a watching brief over conditions applied to grants to non-RSLs. The clause already provides a safety net to ensure that, where we think that a specific condition needs to be prescribed or dealt with in a condition, the Secretary of State can, by means of an order, require that to happen.
    I shall now address some of the noble Lord's questions. How would we ensure that public money is protected and any windfall from increased property prices is reinvested in social housing? I have explained the position that we recognise this as a crucial value-for-money issue. It is absolutely fundamental to registered social landlords and the housing association movement. We do not intend that funds will be unfairly lost for reinvestment in social housing. We are looking for ways to make that work.
    The noble Lord, Lord Best, asked how private developers would be required to raise standards in the future. If long-term management is passed to a registered social landlord, it will be possible to apply new conditions to the normal regulatory processes. For non-registered social landlords, it will not be possible to impose new conditions, although that might be achieved through renegotiation with any non-registered social landlord provider or under a mechanism that provides compensation for such variation.
    As the noble Lord said, there is an issue in that the corporation will struggle to enforce conditions. Obviously, this is a new field. Undoubtedly, enforcement would be simpler if the long-term management was transferred to a registered social landlord. The noble Lord, Lord Best, raised the issue of the extra 17.5 per cent floating around. I have not been briefed on that, but no doubt we will return to the issue. If that happened, it would be subject to regulation—that is, the transfer to an RSL. In other circumstances, if the Housing Corporation feels that the grant conditions have not been met or are not being fully complied with, it will ultimately be able to revert to the courts to enforce the conditions. Obviously, it is hoped that a satisfactory outcome could be achieved in almost all cases through discussion before such a sanction was deemed necessary.
    On the conditions of grant, this begs the question in some ways—if everything negative about the clause that the noble Lord, Lord Best, referred to was true, you might ask who in their right mind would apply for the grant, bearing in mind the onerous conditions that will have to be met. I am not saying that that is a get-out and that we have arranged this in such a way that we do not want anyone to apply. That is simply not true. However, the conditions of grant drawn up by the Housing Corporation will be expected to replicate for non-RSLs the design, construction and management standards that currently apply to registered social landlords receiving approved development programme funding.
    There is no intention that this measure—this clause—will reduce quality. I take that to mean the quality that RSLs—housing associations—work to now, for the very reasons that the noble Lord, Lord Best, raised. Building a home that is to be permanently rented for a tenant in the social sector has different

    1447
    requirements from those of owner-occupation. Generally, the space is used to capacity more and one has to consider the maintenance issues that the noble Lord raised. If we ignore that we are, as the noble Lord said, building up real problems for the future.
    However, as a longstop, the Secretary of State is able to exercise control over the conditions of grant imposed by the Housing Corporation. The Secretary of State will have an order-making power to require the Housing Corporation to impose specific conditions and prescribe matters about which the Housing Corporation is to prepare and impose conditions, and any particular effects that such conditions are to achieve. This might be used to address key risk areas such as the interests of actual and potential tenants or occupiers and the public money or the asset that it has funded.
    The noble Lord, Lord Best, raised the issue of value for money. There is a competition—the money has been top-sliced. The competition will be open to both registered social landlords and non-registered social landlords. Bodies will receive the grant only if they offer value for money. Any non-registered social landlord offering worse value for money than a registered social landlord will not receive any grant.
    The intention of the clause is to see whether we can widen the pool of potential providers of social housing; drive efficiency and improve value for money; and encourage innovation and creativity in this sector, while creating a level playing field between registered social landlords and non-registered social landlords in terms of outcomes for tenants and prospective tenants.
    It was not my intention to throw a bucket of whitewash over the issue of those who might apply for the grant. I wanted to give as robust, clear, firm and black and white an answer as possible to many of the issues raised by the noble Lord, Lord Best, so that there can be no misunderstanding of the clause's intention.
    Between today, when we will finish the Committee stage, and when we come back on Report, one or two major conferences will take place. I do not mean the party political conferences, but one or two others which my right honourable friend the Deputy Prime Minister will address. I want it to be absolutely clear to his audiences that we have a robust line on this which fits very well with some of the issues that the noble Lord, Lord Best, has raised. Nevertheless, I suspect that we will come back to this on Report.
    Lord Best: I am very grateful for those comments and for the Minister's obvious good intentions. We will indeed probably come back to this issue later. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    6.45 p.m.
    Lord Rooker Lord Rooker moved Amendments Nos. 231B to 231E:
    Page 146, line 1, leave out "company" and insert "person"
    Page 146, line 4, leave out "company" and insert "person"
    Page 146, line 8, leave out "company" and insert "person"
    Page 146, line 10, leave out "company" and insert "person"
    On Question, amendments agreed to.
    [Amendment No. 231F not moved.]
    Lord Rooker Lord Rooker moved Amendment No. 231G:
    Page 146, leave out lines 18 to 25.
    On Question, amendment agreed to.
    Clause 190, as amended, agreed to.
    Baroness Hanham Baroness Hanham moved Amendment No. 232:
    After Clause 190, insert the following new clause—
    "STANDARD FOR SOCIAL HOUSING
    (1) The Secretary of State shall ensure that by 2016 all social housing shall as far as is reasonably practicable have insulation, heating and ventilation standards that are at least equivalent to those required in newly built homes by the building regulations for the time being in force.
    (2) For the avoidance of doubt the standards referred to above shall include the following provisions, namely that—

    (a) there must be a heating system that is economical and efficient and which is capable of heating the whole dwelling to a comfortable level in normal weather conditions at a cost that is affordable to the occupant; and

    (b) any property to which this section applies must achieve a SAP rating of no lower than 65.

    (3) In this section "social housing" means housing let by a registered social landlord or a local housing authority."
    The noble Baroness said: I shall briefly explain the rationale of the amendment. Under the Warm Homes and Energy Conservation Act 2000, the Government have a duty to end fuel poverty. The mechanism for doing that in social housing is the decent homes standard. However, the Government have set the standard so low that it will not end fuel poverty. The Government will thus be in breach of the law, as well as failing to achieve the target set in the fuel poverty strategy.
    It is clear that the decent homes standard for social housing has a very serious defect. The defect—the thermal insulation standard for social housing—is set too low and will fail to deliver on the legal obligation to end fuel poverty.
    Upgrading insulation works are triggered on those houses that do not comply with the current standard. That sounds perfectly sound until we see that a large number of homes that do comply with the standard are still in fuel poverty.
    A National Energy Action study of the Stockton Warm Zone indicated that 39 per cent of fuel-poor tenants live in properties which meet the energy efficiency standards contained in the decent homes standard. That represents an enormous number of social housing tenants who live in properties that

    1449
    comply with the decent homes standard and so do not qualify for upgrade works under the standard, which means that they will be left in fuel poverty.
    What of homes that do not comply even with the current standard? The latest figures show that more than a million non-decent homes fail the current low standard on thermal insulation grounds. The current policy is to bring those homes up to the decent homes standard—a standard that will not, as I have explained, guarantee that they will be removed from fuel poverty.
    Amendment No. 232 would therefore rectify the situation by requiring that the standards in social housing equate with those in the building regulations,
    "as far as is reasonably practicable".
    The caveat is necessary because, for instance, it is not practicable to require a house with no cavity wall to have cavity wall insulation.
    New Clause 3 requires that all social housing should be brought up to a Standard Assessment Procedure rating of 65. Support for that rating approach came from the ODPM Select Committee Report on the decent homes standard of 7 May.
    The Government are under a legal duty to end fuel poverty under the Warm Homes and Energy Conservation Act 2000. If they adopt the current decent homes standard and upgrade social housing to a standard that does not comply with the law, the result will be that a further package of works will have to be undertaken on those homes at a later date. I beg to move.
    Lord Rooker: The noble Baroness has been commendably brief. When I looked at my speaking notes on the amendment last night, they extended to 35 paragraphs—drafted for me by the excellent staff in my department who have supported me on the Bill. I pointed out to them that at the time of day that it would come up it might be a bit on the long side, so we have chopped it down a bit.
    Amendment No. 232 would improve the insulation, heating and ventilation standards of existing social housing stock. While we support the general objectives of the amendment, we do not agree that it is the appropriate way to pursue the issue. The Government are fully committed to those objectives by ensuring that all social housing meets the decent homes standard. I do not quite remember the decent homes standard being in force before 1997. I do not think that there was a decent homes standard then. It is a standard that we have set for ourselves and we are happy to be measured by it, because millions of people are benefiting from it. We have set ourselves the goal of eradicating fuel poverty for all vulnerable households by 2010.
    The Bill already contains measures—not all the measures necessary—relating to the energy efficiency of homes. Home information packs will include an energy efficiency assessment that will set out how energy efficient the property is and provide information on
    1450
    measures to improve it. There is no doubt about it; the energy efficiency of housing in this country will improve as a result of that.
    The new housing health and safety rating system—I think that was in Part 1 of the Bill, which we considered a long time ago—will enable authorities to assess the health and safety impact of a range of hazards, including hazards from cold, damp and mould, and to take appropriate action. The best way of dealing with a hazard from cold is to make the dwelling more energy efficient. Not only will local authorities use the housing health and safety rating system as an enforcement tool but they will also be able to use it as a means of assessing risk and prioritising action where it is most needed in the social sector.
    To be defined as decent, a home must meet the current statutory minimum standard for housing, be in a reasonable state of repair, have reasonably modern facilities and services and provide a reasonable degree of thermal comfort. There are hundreds of thousands of currently local authority homes that have had modern bathrooms and kitchens under the Decent Homes programme. Tenants almost literally have new houses—but this clause is about the thermal side and I shall stick to that.
    To meet the thermal comfort criterion, a home must have efficient heating as well as effective insulation. By ensuring that homes are warm and dry and have reasonably modem facilities, we are delivering improved quality of life and reducing health inequalities, fuel poverty and child poverty. A typical social housing tenant living in a home with these measures will not be in fuel poverty. Those that are in fuel poverty after the installation of effective insulation and efficient heating—for instance, because their income is very low—will be in a better position than before, as they will have to spend less to heat their home.
    However, we have to be realistic about that. We cannot accept the notion that heating systems should be capable of heating a dwelling to a level affordable to the occupant because affordability depends on an occupant's income. In instances of households with very low incomes, energy efficiency improvements alone will not be sufficient to allow a household to heat the home affordably. In such cases, income-related measures will be required. So while we are already committed to delivering effective heating, we cannot guarantee occupants' incomes and therefore this provision is not only unacceptable but is also unworkable. One can go so far with the property but at a certain point one has to deal with the income of the person living in it, which we do through the benefits and tax credit systems.
    To sum up, the Government are committed to improving living conditions for the poorest members of our communities. We are improving the heating and insulation of at least 1.3 million homes in the social sector. A massive exercise has been taking place by freeing up and using the capital receipts that had been locked away for years under the previous Tory government. We fully accept the right to buy, but we

    1451
    then use the money from right to buy to build new social housing or to modernise the existing social housing.
    We are providing winter fuel payments to most people aged 60 or over. Because we need to reach everybody, it goes to some people who do not need it. We fully accept that, but that way we reach the people who do need it. We are already committed to further amendments to Part L of the building regulations to increase further the energy efficiency of new dwellings and of existing ones when owners propose to carry out alterations and extension works, which we have debated in this House before. The proposed clause would impose a burden that we do not think is cost-effective and that is not practical in the way in which it is drafted. I fully accept that we need to raise these issues and I am not knocking the fact that the amendment was on the Order Paper.
    Baroness Hanham: I am not going to try to disentangle the Minister's reply at this stage. I shall be happy to read it and to come back to it at Report, if necessary. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Baroness Hamwee Baroness Hamwee moved Amendment No. 232A:
    After Clause 190, insert the following new clause—
    "SUITABILITY OF ACCOMMODATION
    In section 206 of the Housing Act 1996 (c. 52) (discharge of functions by local authorities), after subsection (2) insert—
    "(3) Accommodation will not be deemed suitable unless the applicant has been allowed a reasonable opportunity of viewing the accommodation offered in potential discharge of housing functions.""
    The noble Baroness said: This amendment is about the suitability of accommodation, with which we propose to deal by adding a provision to the 1996 Act. The purpose of the amendment is to reverse the effect of this year's decision of the Court of Appeal in the London Borough of Newham v Khatun and others. That decision was that an applicant for accommodation as homeless to whom a duty has been accepted under Part 7 of the 1996 Act can be required to accept accommodation offered in discharge of the duty—and this is the point—without being given the opportunity to view it.
    By the council's scheme, which the Court of Appeal decision in effect franked, if the applicant refused to accept an offer, the council would regard its duty as discharged and cease to secure accommodation for an applicant. Applicants include pregnant women, families with infant children and the vulnerable.
    The code of guidance issued in July 2002 by the Office of the Deputy Prime Minister implies that applicants should be allowed an opportunity to view, by advising that housing authorities,
    "must allow applicants a reasonable period for considering offers of accommodation".
    It included in the assessment of what was reasonable,
    "whether they are already familiar with the property in question".
    The judge at first instance observed that the policy requires the applicant to enter into binding legal obligations in relation to a property sight unseen. In addition to that, the council is deprived of the applicants' views on the property, which the court rightly observed would be relevant to a decision as to the suitability if the applicant was able to give them. An applicant can request a statutory review of suitability, which the council would conduct, whether the offer is accepted or not, but at best the applicant will have had to accept the property before or at the same time as requesting the review, and to take up occupation before the review is completed. If the review is successful, the council will have to offer another property—which means one more move, unnecessary disruption for the applicant, and the council spending time on the formal statutory review process, which it could have avoided.
    The justification for the policy is the need to remove applicants and their families from bed and breakfast accommodation as quickly as possible. Obviously, that is desirable, but the brief time required for an inspection can hardly cause a significant delay. I have referred already to the confusion, distress and so on that is caused by the policy, and the potential for avoidable error on the part of the council. The amendment allows for occasions when an inspection is not practicable by referring to a "reasonable opportunity".
    This is not the first time that we have addressed the issue. During the passage of the Homelessness Bill in 2001, the noble and learned Lord, Lord Falconer, who was then Housing Minister, accepted the concern and pointed to the protection of the code of guidance. Shelter, which is not the only organisation to have brought the matter to our attention, is concerned that the decision of the Court of Appeal would undermine the code.
    I hope that if the Minister cannot accept the amendment in these precise terms, it is something that can be taken away and worked on so that it is right technically. There is so much in this Bill that it would be a great pity not to use this opportunity to tweak a provision of a previous statute which is going slightly wrong and get it right. I beg to move.
    Lord Rooker: I shall try to do justice to the amendment. It is an important issue, but we must also ensure that we are living in the real world as well. I know that the noble Baroness is concerned to ensure that homeless applicants are treated fairly, which is what we want. We want people to be provided with accommodation suitable for their needs. We share those concerns.
    7 p.m.
    That is partly why, for example, we introduced a target of reducing to zero the number of families with children accommodated under the homelessness legislation in bed and breakfast hotels and similar establishments for more than six weeks. That challenging target was met outright by 95 per cent of local housing authorities by the due date of 31 March this year. There were some 26 families.

    1453
    In other words, when the target was announced, 6,000 children were moved out of bed and breakfast. It is true that some of them may have gone into temporary accommodation, but they have gone into a home of their own where they have a room, a kitchen and they can have their friends round. They are out of bed and breakfast accommodation. That was an incredible achievement by local government of all shades and we are seeking to maintain that figure having hit the target. We keep a constant watch on matters and we have since legislated so that if bed and breakfast accommodation has to be used it cannot be used for longer than six weeks.
    We are also setting new accommodation standards for bed and breakfast accommodation and will be consolidating existing standards that apply to accommodation generally, when we issue a revision of the homelessness code of guidance for local authorities in the near future.
    The Government want local housing authorities to adopt customer-centred approaches to the allocation of social housing, which give applicants more of a say in choosing where they live. While local housing authorities are under no statutory obligation to offer a choice of accommodation to applicants when they make an allocation of accommodation under Part 6, they are strongly encouraged to do so.
    Indeed, the Government have set a target for all housing authorities to have adopted a choice-based approach to letting their long term accommodation by the year 2010. Furthermore, we believe that, where possible, choice-based lettings schemes should include homeless households. Offering choice is an important aspect of enabling the creation of sustainable communities.
    However, the homelessness legislation provides a safety net for individuals who find themselves in a housing crisis. In areas of high housing demand where affordable accommodation is in short supply, it would not be practical for authorities to be required to offer a choice of such accommodation, or to take fully into account an applicant's preferences.
    The type of accommodation used to discharge such a duty could include a place in a hostel; an offer of a non-secure tenancy in a house or flat, either in the authority's own stock or leased from another landlord; a direct tenancy with another landlord or, as a last resort, a place in a bed and breakfast establishment.
    It will not always be practical for an applicant to view the accommodation beforehand; to be frank, there may be little point if no choice is being offered. It is important that the accommodation meets the minimum standards and is suitable for the applicant. In any particular case it is for the authority to decide whether the accommodation is suitable for the applicant.
    In the main, where it is practical to do so, people, including the homeless, should have a choice under a choice-based lettings programme. Homeless applicants are using a different route for housing from people waiting in the queue or for an exchange. We need to make sure that their homeless circumstances are taken
    1454
    into account. We are making sure that they have a roof. There are different ways of doing that. Many authorities are introducing policies, which we greatly applaud, helping to prevent homelessness.
    Where interim temporary accommodation has been secured by a local authority in discharge of its Part 7 duties, it is not possible to give people a choice in the normal sense of the word. This is crisis accommodation provided to cater for urgent needs of homeless applicants, many of whom would otherwise be living in unreasonable circumstances and some even sleeping rough.
    We have cut rough sleeping by 70 per cent. They are not all in permanent long-term accommodation, but they are not on the streets. That figure is checked frequently. I have been out with the team myself not all night but late at night to see the work that goes on. We have cut rough sleeping by 70 per cent. We have removed families with children from bed-and-breakfast accommodation, and we now seek, through an increase in the housing programme, to address the provision of more social accommodation. In the mean time, for crisis accommodation it is not always possible to offer the choice that others would get using the normal route for housing.
    Baroness Hamwee: It is obviously important that those who know far more about this than I can hope to should look at what the Minister had to say and see whether they feel anything can be retrieved from it. However, I do not mean that quite as aggressively as it may have sounded.
    The Minister has talked throughout about choice. Of course this amendment is about choice, but it is based on what is regarded as suitable for the purposes of the 1996 Act. There is a distinction there that may be relevant to this point.
    The Minister started by mentioning the need to live in the real world. Of course, I accept that. This was intended as a real world amendment.
    Lord Rooker: That was not aimed at the noble Baroness but at the judges.
    Baroness Hamwee: If we are having another knock at the lawyers, that is all right. It is the judges who do not live in the real world. In any event, it is a detailed and fairly technical point even though it is a real issue for those involved. For the moment, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clauses 191 to 193 agreed to.
    Schedule 9 agreed to.
    Baroness Hanham Baroness Hanham moved Amendment No. 233:
    Before Clause 194, insert the following new clause—
    "GENERAL PRINCIPLE AS TO THE EXERCISE OF FUNCTIONS
    (1) In the exercise of their functions under Parts 1, 2, 3, 4 and 7 of this Act, any national authority, local housing authority or residential property tribunal shall, so far as is practicable, seek to ensure that the nature and extent of any works required to be

    1455
    carried out in respect of any premises or any facilities equipment or amenities to be provided in connections with the premises or standards to be complied with shall be no more than the minimum necessary commensurate with the health and safety of the occupiers or likely occupiers of the premises concerned.
    (2) In determining how to exercise any function for the purposes of subsection (1) each national authority, local housing authority and residential property tribunal shall have regard to the following—

    (a) the age, character and locality of the premises concerned,

    (b) the cost of carrying out any works or providing any facility, equipment or amenity,

    (c) the nature and extent of any works to be carried out or facility, equipment or amenity to be provided in such premises,

    (d) the existing structure and design and layout of the premises,

    (e) how any works, facilities or amenities will affect the matters referred to in paragraph (d),

    (f) whether or not the premises are a listed building or located within a conservation area within the meaning of the Town & Country Planning Act 1990 (c. 8).

    (3) Any reference to a "function" includes a "power"."
    The noble Baroness said: I think that it has been the Government's intention all the way through to ensure that there was a light-touch regulation in relation to HMO licensing. We seem to be drifting back in the Bill, but there we are. However, as things stand at the moment it does not look quite so light-touch.
    The implementation of the Bill lies in the hands of local authorities. While barriers are breaking down, historically, landlords have somewhat regarded local authorities and their environmental health officers as hostile to the private rented sector. Landlords sometimes feel that local authorities discriminate against them, not always applying the same strict standards to their own properties.
    Throughout the debate on the Bill so far, the Government have acknowledged that the private rented sector is something of a cottage industry. With the "buy-to-let" boom, a majority of landlords own fewer than three properties. For example, many parents have in recent years bought properties in student areas for their children to live in and let out the other rooms. They will be surprised to find that they will be brought into the licensing net with all the costs and regulation involved. It would not be unreasonable to suppose that complying with the criteria for licensing could amount to about £10,000 a house. There is, therefore, considerable risk of disinvestment, if significant regulatory and cost burdens are placed on small landlords.
    Prior to the passing of the Housing Act 1988, the private rented sector was dying on its feet. Since then, the tide has turned but large-scale residential property operators are notable by their absence from the sector. By and large, it is reliant upon individual investors, particularly the buy-to-let investor.
    It is vital to recognise that many houses in multiple occupation provide relatively low cost affordable housing. If the requirements imposed upon them are over the top, they will be lost to the market. Over the last few years there has been a major loss of HMO
    1456
    accommodation, particularly in London, because owners have converted them back to flats. That problem will be exacerbated if excessive requirements are placed on landlords.
    It is important that there be a statement of principle in the Bill, so as to ensure that those involved in carrying it into effect have a signpost by which to work. That is particularly significant as regards the residential property tribunals that will deal with appeals as well as the national authorities when setting standards.
    The clause would ensure minimum measures, so as to impose the minimal financial burden, but always commensurate with the health and safety of occupiers. The clause then goes on to set out the factors that should be considered when any decision is taken, whether in relation to the setting of standards, enforcement action or appeals. It is vital to take into account the age and character of a property, otherwise one has a situation of new wine in old bottles. One cannot easily bring Victorian and Edwardian properties up to a modern standard. Similarly, there are problems in dealing with listed buildings, where a balance must be struck with the historical features of the building. The cost of any work is an important factor to ensure that it is not unreasonable. At the end of the day, if it is excessive, it will be passed on in higher rents. I beg to move.
    Lord Bassam of Brighton: Amendment No. 233 would promote the principle that any requirement on landlords should be no more than is necessary to ensure the health and safety of the occupiers, or likely occupiers, of the premises. I think I understand what lies behind the amendment, and acknowledge that none of us wants local authorities to impose unreasonable requirements on landlords to carry out unnecessary works. I cannot support the amendment, however.
    The items listed in subsection (2) of the new clause would, if necessary, be more appropriately dealt with in guidance for the purposes of Part 1 of the Bill. Clause 8 provides for guidance to be issued as to the exercise of Part 1 functions. Indeed, under Part 1, a local authority can serve a notice requiring works to be carried out only if they are necessary to protect the health and safety of the occupier. However, I do not agree that works cannot be required to provide or improve amenities in HMOs unless necessary for health and safety reasons. Licensing conditions must be able to be imposed to ensure that the HMO is reasonably suitable for multiple occupation, which, I think we could all agree, is more about decency and comfort than health and safety.
    When we debated Part 2, I sensed a general agreement that, by and large, both sides of the House trusted local authorities to do things properly, and that they should be able to exercise their discretion in an appropriate way. To some extent, the amendment takes away that discretion. I have no reason at all to suppose that local authorities will not take into consideration the matters listed in subsection (2) (a) to (f) when determining whether or not to require works to amenity standards. But I do not think it is necessary

    1457
    to set this out as a statutory duty. Also, I do not think it is appropriate to direct a residential property tribunal in this regard. The whole point of the appeals procedure is to enable the tribunal to rehear the case and reach its own conclusion on the reasonableness, or not, of the original decision, having regard to all the circumstances.
    I can understand the spirit behind the amendment, and I can see some of the problems, but I do not think this is the best way to do it. It would probably end up being an abuse of the residential property tribunal. I hope that the noble Baroness, Lady Hanham, feels able to withdraw the amendment.
    Baroness Hanham: I thank the Minister for his reply. This may be something that we could come back to at the earlier stage of the Bill next time. I take his point about the guidance in Part 1, but we have got to be really careful—and I know we are in a different part of the Bill now—that the pressures we put with regard to houses in multiple occupation, particularly on landlords with a limited number of properties, are not so onerous that they simply give up and go away. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 194 [Residential property tribunals]:
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 234:
    Page 150, line 25, leave out subsection (5) and insert—
    "(5) In this section "enactment" includes an enactment comprised in subordinate legislation (within the meaning of the Interpretation Act 1978 (c. 30))."
    The noble Lord said: Amendments Nos. 234 and 235 concern the jurisdiction of residential property tribunals. Amendments Nos. 236, 237 and 238 concern procedural matters to be made by regulations relating to proceedings before them. Clause 194 provides for the constitution and jurisdiction of residential property tribunals. Amendment No. 234 is a technical amendment to clarify that "enactment" in subsection (4) means both primary and secondary legislation.
    Amendment No. 235 adds a new clause, Clause 194A, to provide the tribunal with sufficient jurisdiction to dispose of all the relevant issues relating to a case at one hearing. It also gives effect to Schedule 10. Schedule 10 provides that regulations may be made concerning the procedural matters contained therein.
    7.15 p.m.
    Amendment No. 236 is consequential on amendments made to Clause 97. Amendment No. 237 amends Schedule 10 to provide that regulations can be made to set out standard timelines and directions in the most straightforward of cases, with flexibility for a tribunal to vary them in appropriate circumstances. It also removes criminal liability for non compliance with a fault cost provision which is more appropriate for citizen V state appeals.
    Amendment No. 238 provides that regulations may be made so that tribunals can award costs against a party who has acted unreasonably, whether or not that party wins the case. I beg to move.
    On Question, amendment agreed to.
    Clause 194, as amended, agreed to.
    Lord Rooker Lord Rooker moved Amendment No. 235:
    After Clause 194, insert the following new clause—
    "POWERS AND PROCEDURE OF RESIDENTIAL PROPERTY TRIBUNALS
    (1) A residential property tribunal exercising any jurisdiction by virtue of any enactment has, in addition to any specific powers exercisable by it in exercising that jurisdiction, the general power mentioned in subsection (2).
    (2) The tribunal's general power is a power by order to give such directions as the tribunal considers necessary or desirable for securing the just, expeditious and economical disposal of the proceedings or any issue raised in or in connection with them.
    (3) In deciding whether to give directions under its general power a tribunal must have regard to—

    (a) the matters falling to be determined in the proceedings,

    (b) any other circumstances appearing to the tribunal to be relevant, and

    (c) the provisions of the enactment by virtue of which it is exercising jurisdiction and of any other enactment appearing to it to be relevant.

    (4) A tribunal may give directions under its general power whether or not they were originally sought by a party to the proceedings.
    (5) When exercising jurisdiction under this Act, the directions which may be given by a tribunal under its general power include (where appropriate)—

    (a) directions requiring a licence to be granted under Part 2 or 3 of this Act;

    (b) directions requiring any licence so granted to contain such terms as are specified in the directions;

    (c) directions requiring any order made under Part 4 of this Act to contain such terms as are so specified;

    (d) directions that any building or part of a building so specified is to be treated as if an HMO declaration had been served in respect of it on such date as is so specified (without there being any right to appeal against it under section 218(9)).

    (6) Nothing in any enactment conferring specific powers on a residential property tribunal is to be regarded as affecting the operation of the preceding provisions of this section.
    (7) Schedule 10 (residential property tribunals: procedure) has effect.
    (8) Section 194(5) applies also for the purposes of this section and Schedule 10."
    On Question, amendment agreed to.
    Schedule 10 [Residential property tribunals: procedure]:
    Lord Bassam of Brighton Lord Bassam of Brighton moved Amendments Nos. 236 to 238:
    Page 222, line 22, at end insert "; and
    "() in the case of applications under section 97(4) or (7), requiring the service of copies of the draft orders submitted with the applications."
    Page 223, line 20, leave out paragraph 5 and insert—"
    "5 (1) Procedure regulations may include—

    (a) provision relating to the supply of information and documents by a party to the proceedings, and

    (b) in particular any provision authorised by the following provisions of this paragraph.

    (2) The regulations may include provision for requiring, or empowering the tribunal to require, a party to proceedings before a tribunal—

    1459

    (a) to supply to the tribunal information or documents specified, or of a description specified, in the regulations or in an order made by the tribunal;

    (b) to supply to any other party copies of any information or documents supplied to the tribunal;

    (c) to supply any such information, documents or copies by such time as is specified in or determined in accordance with the regulations or order.

    (3) The regulations may also include provision—

    (a) for granting a party to the proceedings such disclosure or inspection of documents, or such right to further information, as might be granted by a county court;

    (b) for requiring persons to attend to give evidence and produce documents;

    (c) for authorising the administration of oaths to witnesses.

    (4) The regulations may include provision empowering a tribunal to dismiss, or allow, the whole or part of an appeal or application in a case where a party to the proceedings has failed to comply with—

    (a) a requirement imposed by regulations made by virtue of this paragraph, or

    (b) an order of the tribunal made by virtue of any such regulations."

    Page 225, leave out lines 20 to 22 and insert—
    "() he has failed to comply with an order made by the tribunal;
    () in accordance with regulations made by virtue of paragraph 5(4), the tribunal dismisses, or allows, the whole or part of an application or appeal by reason of his failure to comply with a requirement imposed by regulations made by virtue of paragraph 5;
    ()in accordance with regulations made by virtue of paragraph 9, the tribunal dismisses the whole or part of an application or appeal made by him to the tribunal; or"
    On Question, amendments agreed to.
    Schedule 10, as amended, agreed to.
    Clauses 195 to 197 agreed to.
    Clause 198 [Management regulations in respect of HMOs]:
    [Amendment No. 238A not moved.]
    Clause 198 agreed to.
    Clause 199 [Power to require documents to be produced]:
    Lord Rooker Lord Rooker moved Amendment No. 238B:
    Page 152, leave out lines 36 and 37 and insert "A person authorised in writing by a local housing authority may exercise the power conferred by subsection (2) in relation to documents reasonably required by the authority—"
    The noble Lord said: Amendments Nos. 238B and 238C respond to a recommendation of the Joint Committee on Human Rights. Clause 199 allows a local housing authority to require the provision of documentation that the authority might need in order to carry out its functions under Parts 1 to 4 of the Bill and to investigate offences committed in relation to any residential premises. No person can be required to produce documents which he would be entitled to refuse to produce in court. The authority may serve a notice on a relevant person. Subsection (7) defines "relevant person" for the purpose of these amendments.
    The Joint Committee on Human Rights in its 10th report has expressed concern that the requirement to exercise this power proportionately is not sufficiently built into the Bill. The lack of any procedural safeguards, in particular the lack of a requirement for either judicial authorisation or for an appropriate level of internal authorisation, leads in its view to a risk of unjustified use of this power in breach of Article 8 rights.
    These amendments are therefore brought forward and we believe that they meet the concerns of the Joint Committee on Human Rights without adding to the administrative burden on authorities. I beg to move.
    On Question, amendment agreed to.
    Lord Rooker Lord Rooker moved Amendment No. 238C:
    Page 152, line 42, leave out "local housing authority" and insert "person so authorised"
    On Question, amendment agreed to.
    Clause 199, as amended, agreed to.
    Clauses 200 to 202 agreed to.
    Clause 203 [Powers of entry]:
    Lord Rooker Lord Rooker moved Amendments Nos. 238D and 238E:
    Page 155, line 2, after "order" insert "to carry out an inspection under section 4(1) or otherwise"
    Page 155, line 8, leave out subsection (2) and insert—
    "(1A) Subsection (2) also applies where the proper officer of the local housing authority considers that a survey or examination of any premises is necessary in order to carry out an inspection under section 4(2).
    (2) Where this subsection applies—

    (a) a person authorised by the local housing authority (in a case within subsection (1)), or

    (b) the proper officer (in a case within subsection (1A)),

    may enter the premises in question at any reasonable time for the purpose of carrying out a survey or examination of the premises."
    On Question, amendments agreed to.
    The Deputy Chairman of Committees: I should have warned the noble Baroness that, by reason of pre-emption, if Amendment No. 238E was agreed to, Amendments Nos. 238F and 238G could not be moved. I apologise to the noble Baroness, Lady Hanham, that she cannot move those amendments.
    [Amendments Nos. 238F and 238G not moved.]
    Lord Rooker Lord Rooker moved Amendment No. 238H:
    Page 155, line 21, after "person" insert "or proper officer"
    On Question, amendment agreed to.
    Baroness Hanham Baroness Hanham moved Amendment No. 238J:
    Page 155, line 31, at end insert ", and
    (c) only after the issuing of a warrant in relation to the premises issued by a justice of the peace"
    The noble Baroness said: I have been knocked back by not being told earlier that my other amendments were pre-emptive. I do not quite understand that. But I understand that I can still speak.
    This clause is about the power of entry. As it stands a local authority can effectively send an authorised person to enter the home of an individual for the purpose of Clause 203, without seeking even the approval of a magistrate or some other judicial authority. Can the Minister say whether that is a new departure, because Amendments Nos. 238G and 238J specify that before such action can be taken the local authority must seek the authorisation of a warrant of a magistrate?
    Amendment No. 238F is simply a probing amendment which has been pre-empted. Finally, Amendment No. 238K would remove from the armoury of the local authority the ability to leave recording equipment on any site it visited. I have to say that, reading between the lines, that gives enough legitimacy for a local authority to basically spy on and bug an individual in their accommodation. This would appear to be a worrying departure. We need from the Minister an understanding of what is required in terms of the powers of entry, so that we are not giving power of entry to any local authority person, whether authorised to be dealing with these matters or not. I beg to move.
    Lord Bassam of Brighton: This group of amendments, as the noble Baroness said, seeks to limit access where a warrant has already been issued. I presume that this is not necessary when the owner is prepared to co-operate.
    Baroness Hanham: This amendment has nothing to do with a situation in which a warrant has been issued. It states that there should be no entry without a warrant. I think we are on the wrong side of the coin.
    Lord Bassam of Brighton: The amendment is designed to prevent an authority entering premises without a warrant. I understand the point. I am not quite sure what the problem is, because I think that such powers have existed before but I wish to check that.
    Specifically, Amendment No. 238K relates to entering premises to remove recording. No, I believe that what is being attacked here is a concern about eavesdropping. Is that correct?
    Baroness Hanham: There is a concern, first, about people, however prominent in the local authority, waltzing into other people's property. Secondly, there is a concern about leaving recording equipment for some reason—however good they might think it is—that could potentially bug the property. I cannot make it much clearer than that.
    Lord Bassam of Brighton: The powers contained in Clause 203 give the local housing authority power of access where certain conditions are met. Representatives of the authority must have written authorisation setting out the purpose for which the entry is authorised and must give at least 24 hours notice to the owner or occupier of the premises they intend to enter.
    1462
    Permission under the clause does not include a power to use force to enter and the power of entry includes entry for the purpose of taking samples. That is how it is framed, and it is also relevant to mention that Clause 204 enables a justice of the peace to issue a warrant for admission to premises, and that this includes power to enter by force, but only if necessary. The power is applicable, however, only when either entry under Clause 203 has been refused, or the property is empty and immediate access is necessary, or prior warning of entry is likely to negate the purpose of access. I understand the concerns, but there is sufficient qualification and hedging of the entry power so that the problem that the noble Baroness, Lady Hanham, sees is not so obvious.
    In particular, the recording equipment referred to, which may well have triggered part of the concern in terms of eavesdropping and so on, is for recording levels of, for example, radon, or other harmful gases or particles. The inspector may need to leave the equipment—I am sure the noble Baroness will be familiar with this sort of activity from her local government experience—and return after a period of time, rather than take an immediate test and leave with the equipment. We do not want, in these circumstances, where there is an important issue of public health, to tie the hands of the inspector and prevent the inspector from acting effectively.
    However, the inspector cannot simply leave equipment that records gases or particles without justification. I would like to reassure the noble Baroness, Lady Hanham, that we have hedged this power sufficiently. It is a matter of public protection and it is not a power that we would advance without all of those issues being at the forefront of our thinking.
    Baroness Hanham: I am sorry that it is so late, because I would really wish to test the Minister on what he has said. Clause 203(4) states that before entering the premises the authorised person must give 24 hours' notice to the owner of the premises or to the occupier, if any. The chances arc that there will be somebody there. I will read what the Minister finally said when we got the thing right, but there is a real problem with people having the right to enter property—
    Lord Bassam of Brighton: Would it help if between now and Report I sent the noble Baroness, Lady Hanham, a note giving some further explanation? This is a benign power. I can understand, having heard the noble Baroness read the subsection, that there may be some concern that we are being over-zealous here, but that is not the intention. I think that I could probably reassure the noble Baroness in correspondence.
    Baroness Hanham: I should be grateful for that. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 238K not moved.]
    Clause 203, as amended, agreed to.
    Clause 204 [Warrant to authorise entry]:
    Lord Rooker Lord Rooker moved Amendment No. 238L:
    Page 156, line 15, after "order" insert "to carry out an inspection under section 4(1) or (2) or otherwise"
    On Question, amendment agreed to.
    Clause 204, as amended, agreed to.
    Clauses 205 and 206 agreed to.
    Lord Rooker Lord Rooker moved Amendment No. 238M:
    After Clause 206, insert the following new clause—
    "AUTHORISATIONS FOR ENFORCEMENT PURPOSES ETC.
    (1) This section applies to any authorisation given for the purposes of any of the following provisions—

    (a) section 122 (management orders: power of entry to carry out work),

    (b) section 199 (power to require documents to be produced),

    (c) section 203 (powers of entry),

    (d) paragraph 3(4) of Schedule 3 (improvement notices: power to enter to carry out work), and

    (e) paragraph 25 of Schedule (Further provisions regarding empty dwelling management orders) (EDMOs: power of entry to carry out work).

    (2) Any such authorisation must be given by the appropriate officer of the local housing authority.
    (3) For the purposes of this section a person is "an appropriate officer" of a local housing authority, in relation to an authorisation given by the authority, if either—

    (a) he is a deputy chief officer of the authority (within the meaning of section 2 of the Local Government and Housing Act 1989 (c. 42)), and

    (b) the duties of his post consist of or include duties relating to the exercise of the functions of the authority in connection with which the authorisation is given,

    or he is an officer of the authority to whom such a deputy chief officer reports directly, or is directly accountable, as respects duties so relating."
    On Question, amendment agreed to.
    [Amendment No. 238N not moved.]
    Clauses 207 and 208 agreed to.
    7.30 p.m.
    Clause 209 [Service of documents]:
    Lord Rooker Lord Rooker moved Amendment No. 239:
    Page 158, line 14, leave out from "premises" to end of line 16.
    The noble Lord said: This group contains 14 government amendments, in the middle of which is deposited one opposition amendment. I shall try briefly to work my way through each of the 14 government amendments. Some are of some substance; others are not. I shall try to cut the cloth accordingly.
    Amendments Nos. 239, 240 and 241 are minor amendments to Clause 209, which is concerned with the service of documents by local authorities on persons for the purposes of Parts 1 to 4 and Part 7. They either deal with inconsistency between subsections or they clarify subsections. I do not need to say any more.
    Government Amendment No. 244A provides that the appropriate national authority can make rules concerning the calculation of numbers of persons for the
    1464
    provisions of the Bill. It is intended that the rules will be made by calculating the number of persons, including, in particular, children, for the purposes of licensing houses in multiple occupation. The appropriate national authority will consult on the rules and, of course, any order or regulation containing them will be laid before the House. Essentially, the rules will apply to the maximum permitted occupancy levels under licensing and shared amenity standards.
    Government Amendment No. 252 provides that the new clause contained within Amendment No. 244A will come into force on the day that the Bill receives Royal Assent.
    Government Amendment No. 253—I have gone out of order but it does not matter—is needed to update the Bill to provide for the commencement of new provisions inserted into the Bill during the Committee stage.
    I turn to government Amendment No. 245. Schedule 12 makes minor and consequential amendments which are needed as a result of the Bill. This amendment simply adds to the schedule amendments which replace references in the Land Compensation Act 1973 to current housing enforcement notices—repair notices and closing orders—with the new enforcement notices in the Bill. The amendment is necessary to deal with both existing references to the 1973 Act and those in the new "loss payment: exclusion" provisions inserted by the Planning and Compulsory Purchase Act 2004.
    Government Amendment No. 247 also relates to Schedule 12, which, again, makes minor and consequential amendments needed as a result of the Bill. The amendment revises the new Section 268 of the Housing Act 1985 that already appears in Schedule 12.
    Amendments Nos. 248, 249 and 250 are to Schedule 13 and repeal a number of provisions made redundant by changes made as we have gone through the Bill.
    I now return to my speaking note on government Amendment No. 242D. This is intended to close a major loophole in the legislation whereby a manager of a building can claim that the property is not a house in multiple occupation because the occupiers do not meet the necessary residency requirements. Essentially, the new clause introduced by the amendment places the burden of proof with regard to these matters on the manager. The general rule of thumb is that, in order for a building to be regarded as house in multiple occupation, it must be occupied by persons as their only or main residence.
    The Government recognise that there may be circumstances in which there is a mix of occupancies—the most obvious example being bed and breakfast establishments, where some of the accommodation could be occupied by tourists and other accommodation could be occupied on a long-term basis by homeless families or asylum seekers. So we do not want a loophole to exist.
    Government Amendments Nos. 252 and 253 are needed to update the Bill to provide for the commencement of new provisions inserted into the Bill during this Committee stage. If noble Lords wish to speak to Amendment No. 242A I shall be happy to respond to that now. I see the answer is "No". I beg to move.
    On Question, amendment agreed to.
    Lord Rooker Lord Rooker moved Amendments Nos. 240 and 241:
    Page 158, line 41, at end insert—
    "() Subsection (1)(c) or (5)(c) applies whether the provision requiring or authorising service of the document refers in terms to a person having an estate or interest in premises or instead refers to a class of person having such an estate or interest (such as owners, lessees or mortgagees)."
    Page 159, line 7, after "section" insert—

    "(a) references to a person managing premises include references to a person authorised to permit persons to occupy premises; and

    (b)"

    On Question, amendments agreed to.
    Clause 209, as amended, agreed to.
    Clauses 210 to 212 agreed to.
    Clause 213 [Orders and regulations]:
    The Deputy Chairman of Committees: I have to advise the Committee that if Amendment No. 242ZA is agreed to, I shall not be able to call Amendment No. 242A.
    Lord Rooker Lord Rooker moved Amendment No. 242ZA:
    Page 161, line 11, leave out subsections (5) and (6) and insert—
    "(5) Subsection (4) does not apply to any order under section 231 or paragraph 3 of Schedule (Provisions relating to tenancy deposit schemes).
    (6) Subsection (4) also does not apply to—

    (a) any order under section 54(3) which makes the provision authorised by section 54(4),

    (b) any order under section 77(5) or (7),

    (c) any order under section 187 or 194(3),

    (d) any order under section 226(2) which modifies any provision of an Act,

    (e) any regulations under section 217(6),

    (f) any regulations under paragraph 3 of Schedule 4 or paragraph 9 of Schedule (Provisions relating to tenancy deposit schemes), or

    (g) any regulations made by virtue of paragraph 11(3)(b) or 12(3)(b) of Schedule 10;

    and no such order or regulations may be made by the Secretary of State (whether alone or with other provisions) unless a draft of the statutory instrument containing the order or regulations has been laid before, and approved by a resolution of, each House of Parliament."
    On Question, amendment agreed to.
    [Amendment No. 242A not moved.]
    Clause 213, as amended, agreed to.
    Clause 214 [Offences by bodies corporate]:
    [Amendment No. 242B not moved.]
    Clause 214 agreed to.
    Clause 215 [Power to up-rate level of fines for certain offences]:
    [Amendment No. 242C not moved.]
    Clause 215 agreed to.
    Clauses 216 to 222 agreed to.
    Lord Rooker Lord Rooker moved Amendment No. 242D:
    After Clause 222, insert the following new clause—
    "HMOS: PRESUMPTION THAT SOLE USE CONDITION OR SIGNIFICANT USE CONDITION IS MET
    (1) Where a question arises in any proceedings as to whether either of the following is met in respect of a building or part of a building—

    (a) the sole use condition, or

    (b) the significant use condition,

    it shall be presumed, for the purposes of the proceedings, that the condition is met unless the contrary is shown.
    (2) In this section—

    (a) "the sole use condition" means the condition contained in—

    (i) section 217(2)(d) (as it applies for the purposes of the standard test or the self-contained flat test), or

    (ii) section 217(4)(e),

    as the case may be; and

    (b) "the significant use condition" means the condition contained in section 218(2) that the occupation of the living accommodation or flat referred to in that provision by persons who do not form a single household constitutes a significant use of that accommodation or flat."

    On Question, amendment agreed to.
    Clause 223 agreed to.
    Clause 224 [Meaning of "lease", "tenancy", "occupier" and "owner" etc.]:
    Lord Rooker Lord Rooker moved Amendments Nos. 243 and 244:
    Page 168, line 34, at end insert—
    "And see sections (General effect of interim management orders: leases and licences granted by authority) and (General effect of final management orders: leases and licences granted by authority) (which also extend the meaning of references to leases)."
    Page 169, line 21, at end insert—
    "And see sections (General effect of interim management orders: leases and licences granted by authority) and (General effect of final management orders: leases and licences granted by authority) (which also extend the meaning of references to licences)."
    On Question, amendments agreed to.
    Clause 224, as amended, agreed to.
    Clause 225 agreed to.
    Lord Rooker Lord Rooker moved Amendment No. 244A:
    After Clause 225, insert the following new clause—
    "CALCULATION OF NUMBERS OF PERSONS
    (1) The appropriate national authority may prescribe rules with respect to the calculation of numbers of persons for the purposes of—

    (a) any provision made by or under this Act which is specified in the rules, or

    (b) any order or licence made or granted under this Act of any description which is so specified.

    (2) The rules may provide—

    (a) for persons under a particular age to be disregarded for the purposes of any such calculation;

    1467

    (b) for persons under a particular age to be treated as constituting a fraction of a person for the purposes of any such calculation.

    (3) The rules may be prescribed by order or regulations."
    On Question, amendment agreed to.
    Clause 226 agreed to.
    Schedule 12 [Minor and consequential amendments]:
    Lord Rooker Lord Rooker moved Amendments Nos. 245 to 247:
    Page 227, line 38, leave out paragraph 2 and insert—
    "2 The Land Compensation Act 1973 has effect subject to the following amendments.
    2A (1) Section 29 (right to home loss payment where person displaced from dwelling) is amended as follows.
    (2) In subsection (1)—

    (a) for paragraph (b) substitute—

    "(b) the making of a housing order in respect of the dwelling;"; and.

    (b) in paragraph (ii) for the words from "the order" onwards substitute "the housing order;".

    (3) In subsection (3A) for the words from "the acceptance" onwards substitute "the carrying out of any improvement to the dwelling unless he is permanently displaced from it in consequence of the carrying out of that improvement."
    (4) For subsection (7) substitute—
    "(7) In this section "a housing order" means—

    (a) a prohibition order under section 19 or 20 of the Housing Act 2004, or

    (b) a demolition order under section 265 of the Housing Act 1985."

    2B (1) Section 33D (loss payments: exclusions) is amended as follows.
    (2) In subsection (4) for paragraphs (b) and (c) substitute—

    "(b) notice under section 10 of the Housing Act 2004 (improvement notice relating to category 1 hazard);

    (c) notice under section 11 of that Act (improvement notice relating to category 2 hazard);".

    (3) For subsection (5) substitute—
    "(5) These are the orders—

    (a) an order under section 19 of the Housing Act 2004 (prohibition order relating to category 1 hazard);

    (b) an order under section 20 of that Act (prohibition order relating to category 2 hazard);

    (c) an order under section 42 of that Act (emergency prohibition orders);

    (d) an order under section 265 of the Housing Act 1985 (demolition order relating to category 1 or 2 hazard)."

    2C (1) Section 37 (disturbance payments for persons with compensatable interests) is amended as follows.
    (2) In subsection (1)—

    (a) for paragraph (b) substitute—

    "(b) the making of a housing order in respect of a house or building on the land;"; and.

    (b) in paragraph (ii) for the words from "the order" onwards substitute "the housing order;".

    (3) In subsection (2)(c) for "closing" substitute "prohibition".
    (4) In subsection (3) for the words from "any such order" onwards substitute "a housing order within paragraph (b) of that subsection unless he was in lawful possession as aforesaid at the time when the order was made."
    (5) In subsection (3A) for the words from "the acceptance" onwards substitute "the carrying out of any improvement to a house or building unless he is permanently displaced in consequence of the carrying out of that improvement."
    (6) In subsection (9) omit "or undertaking".
    2D (1) Section 39 (duty to rehouse residential occupiers) is amended as follows.
    (2) In subsection (1) for paragraph (b) substitute—

    "(b) the making of a housing order in respect of a house or building on the land;".

    (3) In subsection (6) for the words from "any such order" onwards substitute "a housing order within paragraph (b) of that subsection unless he was residing in the accommodation in question at the time when the order was made."
    (4) In subsection (6A) for the words from "the acceptance" onwards substitute "the carrying out of any improvement to a house or building unless he is permanently displaced from the residential accommodation in question in consequence of the carrying of that improvement."
    (5) In subsection (9) omit "or undertaking"."
    Page 228, line 27, at end insert—
    "Mobile Homes Act 1983 (c. 34)
    In section 2 of the Mobile Homes Act 1983 (terms of agreements) after subsection (4) insert—
    "(5) The supplementary provisions in Part 3 of Schedule 1 to this Act have effect for the purposes of paragraphs 8 and 9 of Part 1 of that Schedule.""
    Page 229, leave out lines 2 to 21 and insert—
    "268 SERVICE OF COPIES OF DEMOLITION ORDER
    (1) A local housing authority who have made a demolition order must serve a copy of the order on every person who, to their knowledge, is—

    (a) an owner or occupier of the whole or part of the premises to which the order relates,

    (b) authorised to permit persons to occupy the whole or part of those premises, or

    (c) a mortgagee of the whole or part of the premises.

    (2) The copies required to be served under subsection (1) shall be served within the period of seven days beginning with the day on which the order is made.
    (3) A copy of the order is to be regarded as having been served on every occupier in accordance with subsections (1) and (2) if a copy of the order is fixed to some conspicuous part of the premises within the period of seven days mentioned in subsection (2).
    (4) An demolition order against which no appeal is brought under section 269 becomes operative at the end of the period of 28 days beginning with the day on which the order is made and is final and conclusive as to matters which could be raised on an appeal.
    (5) Section 209 of the Housing Act 2004 (service of notices)—

    (a) applies in relation to copies required to be served under this section (instead of section 617 below), and

    (b) so applies as it applies in relation to documents required to be served under any provision of Parts 1 to 4 of that Act."

    8A In section 269(1) (right of appeal against demolition or closing order) for the words from "demolition or closing order" to "the order," substitute "demolition order may, within the period of 28 days beginning with the day on which the order is made,".
    After section 269 insert—"
    On Question, amendments agreed to.
    Schedule 12, as amended, agreed to.
    Clause 227 agreed to.
    Schedule 13 [Repeals]:
    Lord Rooker Lord Rooker moved Amendments Nos. 248 to 250:
    Page 239, column 2, leave out line 32 and insert—

    "In section 37(9), the words "or undertaking".

    In section 39(9), the words "or undertaking"."

    Page 240, column 2, leave out lines 20 and 21 and insert—

    "Section 269(2A) and (3A)."

    Page 241, line 8, at end insert—

    "Housing (Consequential Provisions) Act 1985 (c. 71)

    In Schedule 2, paragraph 24(2)(d)."

    On Question, amendments agreed to.
    Schedule 13, as amended, agreed to.
    Clauses 228 and 229 agreed to.
    Clause 230 [Expenses]:
    [Amendment No. 251 not moved.]
    Clause 230 agreed to.
    Clause 231 [Short title, commencement and extent]:
    Lord Rooker Lord Rooker moved Amendments Nos. 252 to 256:
    Page 171, line 7, at end insert "(Calculation of numbers of persons),"
    Page 171, line 16, at end insert—
    "() Schedule (New Schedule 5A to the Housing Act 1985: initial demolition notices),"
    Page 171, line 26, after "171," insert "(Tenancy deposit schemes) to (Sanctions for non-compliance),"
    Page 171, line 26, after "206," insert "(Authorisations for enforcement purposes etc.),"
    Page 171, line 27, at end insert—
    "() Schedule (Provisions relating to tenancy deposit schemes),"
    On Question, amendments agreed to.
    Clause 231, as amended, agreed to.
    House resumed: Bill reported with amendments.

    Employment Relations Bill
    Bill returned from the Commons with the amendments agreed to.

    Royal Assent
    The Deputy Chairman of Committees: My Lords, I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Acts:
    Sustainable and Secure Buildings Act,
    Public Audit (Wales) Act,
    Employment Relations Act.
    House adjourned at eighteen minutes before eight o'clock.