ASSIGNMENTS BY WAY OF EXCHANGE

HL Deb 16 September 2004 vol 664 cc1348-51

(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—

1. (a) that the landlord of the non-secure tenant is a fully mutual housing association registered with the Housing Corporation or Housing for Wales;
2. (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
3. (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.