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Lords Chamber

Volume 692: debated on Tuesday 22 May 2007

House of Lords

Tuesday, 22 May 2007.

The House met at half-past two: the CHAIRMAN OF COMMITTEES on the Woolsack.

Prayers—Read by the Lord Bishop of Chester.

Housing: Energy Performance Certificates

asked Her Majesty’s Government:

How many home inspectors there are who are qualified to issue energy performance certificates required to market homes for sale after 1 June 2007; and how home owners wishing to sell privately will know how and where to make contact in their area.

My Lords, over 3,000 people have already passed their exams with a further 2,500 in training. Home owners wishing to sell privately will be able to contact local energy assessors through business listings services by contacting one of the accreditation schemes or online at the national register of energy performance certificates and home condition reports.

My Lords, I thank the Minister for that reply. This is a very serious matter, but it is almost turning into a farce. Is the Minister aware that the newspapers are advising people that it is cheaper to pay the £200 fine than the £600 fee for the certificate? Will she confirm that, as another newspaper has reported, you do not have to produce the certificate if someone knocks on your door and offers to buy, or if a relation, a friend or someone you meet in the pub offers to buy? In Australia, private sales are not listed as sales; they are listed as “expressions of interest are invited”. Would that type of sale fit into the free category?

My Lords, I will answer the questions in reverse order. The types of sales that the noble Baroness has described as private in Australia would be regarded as private here, as long as no public marketing takes place. When houses are sold privately without being marketed, no HIP is required; if she sold her home to a friend she would not require a HIP. A HIP is required when marketing by an estate agent or someone else kicks in.

It will certainly not be a better option to go for the £200 fine rather than the cost of a HIP. The only additional cost on the HIP is the energy performance certificate of £100. The fine would be £200, which would be imposed again if the offence of not getting a HIP were repeated. I am sure that the House is aware that I will be making a Statement later, after which there is to be a debate. There will be many opportunities today to explore the detail of the Question.

My Lords, will the Minister make sure that she gives advice to everyone? Homes are a major cause of carbon in the atmosphere, and if we are serious about climate change it is very important that we debate these issues, preferably on a cross-party basis, and make any changes that we need from time to time. It is important that this should work. Will she confirm that she will keep that climate change issue in this Bill?

My Lords, that is an extremely important point. Our homes generate 27 per cent of all carbon. Not only should there be cross-party agreement on what we have to do urgently, but people are with us on this. In the most recent YouGov poll, two-thirds of people want more information about energy efficiency and 72 per cent think that it is a good idea to rate energy efficiency. We are going with the grain of what people want, which is the only right and proper thing to do in the circumstances.

My Lords, can the noble Baroness confirm that if the Government reach their target for the number of assessors, each of them will be required to carry out five assessments per day unless the number of housing transactions falls? Assessors are being told that they are not allowed to go up into lofts to inspect the insulation. Is there not a danger that, with these assessors whizzing around the country but not really looking at all the property, the assessments themselves will barely be worth the paper they are written on?

My Lords, the noble Lord is right about one point, which is that it is assumed that the average number of assessments undertaken will be five a day. However, assessors will work at different rates, at different times of the week, and both part-time and full-time. Where he is not right is to say that this is not a serious qualification. The accreditation system has been fully qualified by the QCA, and the certificate will be well worth having because it will save a lot of money on bills.

My Lords, does the noble Baroness agree that while the assessors may be qualified, they have to go on to be accredited? The accreditation may take some time because the Criminal Records Bureau must be consulted.

Yes, my Lords, I can confirm that 1,500 people have been accredited or have applied for accreditation. No one will be able to conduct inspections without having a criminal record clearance. The noble Baroness is quite right about that.

My Lords, how much money will the average home buyer save when the HIPs are in existence, and how much will they save on their energy costs? Further, would my noble friend like to comment on whether she thinks the amount of money saved will be a farce or actually welcomed by first-time buyers?

My Lords, I am absolutely sure that the money saved on energy will be welcomed by everyone. The Energy Saving Trust has shown that savings to the average property owner will come to around £300 a year. If only a fifth of home owners make the basic changes set out in the EPC, they could save around £100 million a year on their energy bills. These are serious figures.

My Lords, who is going to employ the domestic energy assessors, or whatever they are going to be called? Will they be employed by estate agents or lawyers, or will they be self-employed? Who are they responsible to?

My Lords, some of them will be self-employed, while others will be employed by the range of people just mentioned by the noble Baroness. Estate agents themselves are setting up opportunities to qualify and accredit some of their people, as are surveyors. Recruitment will be made across the professions, but we expect to see quite a number of self-employed people.

My Lords, can the noble Baroness give us an idea of what these people were doing before they became assessment officers? Were they on the dole? Why does she think that employing 5,000 people to do a job that has worked perfectly well before and at far less cost is a good thing?

My Lords, this is a new task. We have not carried out audits of what our homes cost in terms of energy before. We have had audits for all sorts of things such as fridges, but we have never had them for our homes, which is slightly bizarre. The types of people coming in vary enormously and cross a range of professions, bringing extra skills with them. For some this represents an opportunity to change careers and qualify for something we are required to do under European law and which will be of benefit to the country.

My Lords, is the noble Baroness aware that I know the cost of the energy used in my house because I pay the bill, and I should imagine that most other householders know too?

My Lords, I have no idea whether the noble Lord has fitted loft insulation, draft proofing, double glazing and cavity wall insulation in his house. He nods his assent and he is wise to have done so. Many people have not done so and they do not know what savings they would make. The energy performance certificate will suggest to householders how they might save money as well as carbon.

Identity Cards

asked Her Majesty’s Government:

Whether, in light of the rising costs shown in the latest Identity Cards Scheme Cost Report, they have any plans to review the implementation of the identity cards scheme.

No, my Lords. The latest Identity Cards Scheme Cost Report, which sets out the estimate of the likely cost of the scheme over the next 10 years, was published on 10 May this year.

My Lords, I thank the Minister for that reply. I should like to award this month’s prize for creative government accounting to her department. The report published last week tries very hard to cover up the fact that the costs went up over the past six months by over £800 million. The total costs over the next 10 years are now calculated at over £6.3 billion, but still exclude costs in a large number of government departments. Does the Minister not agree that the best advice she could give to the incoming Prime Minister is to cut his losses and cancel the scheme?

My Lords, under Section 37 of the Identity Cards Act the Government should have produced the costing by 9 April; they did not do so until 10 May. Have the Government broken the law? Has the Minister’s department carried out any race equality impact assessment under the new UK Borders Bill, which has implications for identity cards estimated at £200 million? What are the repercussions of that?

My Lords, the Government are very sorry that the report due on 9 April was published four weeks late. As noble Lords are aware, we indicated in the second report that we would include the BIA costs, but they were not available until about two days before the report was prepared. Therefore, in order to be consistent with a commitment made by my honourable friend Liam Byrne in the other place on 7 December, we promised to include those costs, and we apologise that the report was a month late. As with all efforts of this nature, we will have assessments made in due course to ensure that they apply appropriately to all our citizens.

My Lords, one of the arguments used by the retiring Prime Minister is that ID cards would help the police to solve the 900,000-plus unsolved crimes. If this is the case, and if the police are even half successful, what does the Prime Minister-in-waiting intend to do with these hundreds of thousands of newly convicted criminals? Send them, no doubt, to our already overcrowded prisons.

My Lords, we hope that the advent of identity cards will help us to better protect individual identities and interdict crime more successfully. Identity theft is a growing scourge that we must tackle and better address. The incoming Prime Minister is as committed to that endeavour as the outgoing one.

My Lords, I urge my noble friend, far from delaying the introduction of the identity card scheme, to consider ways in which it can be speeded up. The sooner we have it in place the better. Will her department consider the possibility of using identity cards for identification purposes at general elections?

My Lords, we are introducing the scheme as speedily and as safely as possible and will continue to do so. Identity cards will have a number of valuable uses, one of which may be as my noble friend suggests.

My Lords, does the Minister concur with the cost figures mentioned by my noble friend Lady Noakes?

My Lords, I do not. I heard what the noble Baroness said about inflated figures. We do not agree with them. The figures in the report are accurate. The previous report indicated £5.4 billion over 10 years; the current report indicates £5.5 billion and introduces the additional amount of £200 million. Those figures are robust and accurate and we hope that those who have the acuity to understand them will be able to affirm that.

My Lords, the noble Baroness seems very sure of her figures. Can she tell the House of any other government programme of this size and complexity where the figures have not gone up year by year? Is she now staking her reputation on the concept that these figures will not further escalate?

My Lords, I am staking my reputation on the fact that we will endeavour on all occasions to be accurate. Let me remind the House that these figures are predicated on what we already know is the cost of the IPS system and producing the passports. We have real reason to believe that the figures are robust.

My Lords, can the Minister guarantee that the computer system for ID cards will successfully co-ordinate every government department required to use them, bearing in mind the disasters that occurred with the NHS, Defra, the Home Office over the original asylum cases, and almost every other major government computer system that I can think of?

My Lords, I again remind the House that the UK visa system has been an unmitigated success. The satisfaction rate of all those who have had the privilege of using it is way over 90 per cent. I am sure the House will not hesitate to celebrate that.

Gambling: Casinos

asked Her Majesty’s Government:

Whether, in response to the defeat of the Gambling (Geographical Distribution of Casino Premises Licences) Order 2007 in the House of Lords on 28 March, they will introduce two orders separating the super-casinos from the other proposed casinos.

My Lords, following the vote in this House, Ministers are considering how to proceed. We will make an announcement in due course, but there is one point I want to make absolutely clear. As the Secretary of State has said on previous occasions, there can be no more than one regional casino in the current Parliament.

My Lords, I recall a tired colleague in another place declaring that if Keir Hardie were alive today, he would be turning in his grave. Certainly Keir Hardie would be puzzled at the readiness of the Government to get into bed with the promoters of these super-casinos when the social effects are so clear and public demand is so limited. Would it not be more democratic, now that we know there is strong opposition in the House, to allow a separate vote? When will the decision be made about the procedure?

My Lords, Keir Hardie lived before the development, for instance, of the football pools, which are a great attraction for working people in this country in terms of gambling. My noble friend has to recognise that there have been social changes over the century since Keir Hardie. Of course there were demands for these casinos. It is clear that a large number of local authorities saw the benefit of the regeneration effect of casinos, and they voted and put forward proposals in the full knowledge that they would have to stand the test of the response of their local communities to the proposals they were putting forward.

My Lords, I hope the Minister will comply with a Motion passed in this House that aimed to separate the 16 large and small casinos and have a separate order for those, and remit the issue of the super-casino to a Joint Select Committee. But what he has just said about the government policy seems directly at odds with what the Prime Minister said only 10 days ago: that he would like to see two super-casinos in one region. What response does the Minister have to that?

My Lords, I do not think the noble Lord is quoting the Prime Minister quite rightly. The Prime Minister was reflecting the fact that the Bill originally had provision for eight casinos, and that the claims of Manchester and Blackpool might be strong but there was no way they could be delivered within the framework of a single casino, which was in the Act that was eventually passed. What happened in this House, as evidenced by the fact that a substantial section of the Liberal Democrat Party voted against the order and for the Motion, was that the Liberal Democrats were persuaded that Blackpool was a better offer than Manchester, when in fact no such proposition was before the House.

My Lords, can my noble friend first say what is the Government’s assessment—or reassessment as the case may be—of Manchester’s case?

My Lords, Manchester’s case was identified by the independent committee—that is why we introduced an order fully consistent with its recommendations. Those virtues were put before the House but were rejected.

My Lords, given what the noble Lord said about having only one super-casino, is it not possible that that could be reconsidered, especially if there will be a committee to consider these matters? Is there not an advantage in having two super-casinos so that a comparison can be made between them if one is in an urban environment and the other in a destination environment?

My Lords, we are governed by the Act as it stands, with provision for one casino. Of course in the distant future it might be possible to extend the number of super-casinos, but prior to the 2005 election, the Government proposal was for eight, with the expectation of a wide regional spread. It was the Conservative Party which insisted that there should only be one, and we have to live with the consequences of that.

My Lords, does my noble friend not accept that one of the principal reasons why the House rejected the order on 28 March was precisely because a large number of us, myself included, felt that the process and the conclusions of the Casino Advisory Panel were seriously flawed? It had in effect misdirected itself and ignored the findings of the Joint Scrutiny Committee on the Gambling Bill and the tone that prevailed throughout its subsequent passage. Therefore, is not the most sensible course for the Government to follow the suggestion made by my noble friend Lord Anderson and split the order, at the same time establishing proper parliamentary scrutiny into the case for, and location of, the one regional casino?

My Lords, my noble friend has to live with the consequences of this action, as do we all. Whatever his motives for voting, the result was to lose the order. The Government are in a difficult position because we could be subject to judicial review if we acted on part of the inspector’s report and not on all of it. My noble friend may adduce that he voted against the order on those grounds, but noble Lords voted on it for many different reasons. The single most obvious fact was that a considerable number of noble Lords thought the casino should be in Blackpool rather than Manchester. That is why the order was lost.

My Lords, have the Government worked out the sum that will need to be charged to super-casinos and others to pay for the costs of rehabilitation of those families who are due to become addicts as a result of this increase in the number of casinos? The sums projected were pretty high.

My Lords, the whole point about the Gambling Act 2005 is that it brought to the fore the concept of social responsibility for gambling, to protect vulnerable groups, particularly children, but also adults who might be subject to addiction. The Act established a framework in which those issues can be effectively addressed, and it is working. However, we do not have the new casinos—certainly not the regional casino—against which to test social effects more effectively and widely. That was the intention behind the order put before the House.

World Bank: Presidency

asked Her Majesty’s Government:

What steps they will take to propose a nomination for the presidency of the World Bank.

My Lords, Her Majesty's Government will work with other member countries of the World Bank to identify and select the best candidate for the job.

My Lords, with the world appetite for neocons somewhat limited at the moment, to say the least, that might rule out Mr Tony Blair. Will the Minister reassure us that the Government will work carefully with leading countries and others over time to secure someone who will give real priority to third-world interests and internal management modernisation of the World Bank?

My Lords, the Government believe that the next president must be appointed on merit and should have a strong commitment to development. He or she must be a proven manager. As noble Lords may know, we made it clear in our White Paper on international development last year that the practice of picking the heads of the World Bank and IMF based on nationality should end and that they should be chosen on merit.

My Lords, the United States has been the major backer of the World Bank by far and it is today. Many other countries are in a position to back and fund the World Bank but do not. The reality is that the United States will have a huge influence on the appointment, but does that excuse the complete secrecy that shrouds the process? Will the Government assure us that they will press for a removal of this non-transparency, which affects the underdeveloped world?

My Lords, the Government wholeheartedly agree that the process must become much more transparent and be reformed. However, reform must be agreed to by all the parties concerned. Reaching that agreement takes time, and the reform takes time to be embedded.

My Lords, Paul Wolfowitz has led the fight against government corruption through bypassing corrupt Administrations. Such a campaign can be successful only if it is maintained over a long period. Will the Government assure the House that they will put pressure on the new president of the bank to continue this stance?

My Lords, the Government will put pressure on whoever is appointed to continue to work against corruption and in favour of good governance. That is our objective.

My Lords, I accept that under the present procedure the appointment of the president of the World Bank is in the gift of the president of the United States and that that cannot be changed overnight, but will Her Majesty's Government, following the principles of their White Paper, press the United States president to agree as part of any deal that this will be the last time that the president is appointed on that basis?

My Lords, discussions are taking place with the United States Government. I am sure that among the items being discussed will be the proposal that, next time, there should certainly be a change. It is interesting to note that senior US officials such as Treasury Secretary Hank Paulson have said that they want a wide-ranging and open consultation process, so I think that things are moving.

My Lords, does the Minister accept that the Prime Minister on his retirement is completely ruled out of being president of the World Bank because the money is not good enough?

My Lords, the president may well—that was a slip of the tongue. My right honourable friend the Prime Minister may not be in line for appointment because he is not an American citizen. I do not know where the rumours pertaining to the Prime Minister and the World Bank have come from. I think that it is just a coincidence of timing.

My Lords, the Prime Minister’s name has come up in this context, and the EU is a larger contributor to the World Bank than is America. However, would it not be a bit rich if he were nominated, given the Government’s track record on BAE Systems and Saudi Arabia and, in particular, the current police investigation into cash for honours?

My Lords, will the Minister confirm that one person who is absolutely certain not to be put forward either as being eligible for, or for being any good as, president of the World Bank would be Sir Ming Campbell?

My Lords, do the Government want to change the charter so that the president need not be a US citizen? The charter states that he must be.

My Lords, I realise that that is in the current charter, but perhaps it needs to be amended as part of reform. I am sure that that is one of the many questions to be addressed. All the multinational institutions were born in 1944, a long time ago. They all have to be reformed to address the problems of the 21st century.

Business

My Lords, with the permission of the House, a Statement on home information packs will be repeated by my noble friend Lady Andrews immediately after the Corporate Manslaughter and Corporate Homicide Bill.

International Tribunals (Sierra Leone) Bill [HL]

Read a third time, and passed, and sent to the Commons.

Digital Switchover (Disclosure of Information) Bill

Read a third time, and passed, and returned to the Commons with an amendment.

Corporate Manslaughter and Corporate Homicide Bill

My Lords, I beg to move that the Commons amendment be now considered.

Moved accordingly, and, on Question, Motion agreed to.

[The page and line references are to HL Bill 19 as first printed for the Lords.]

Motion A

2: Clause 2, page 2, line 29, at end insert-

“(d) a duty owed to anyone held in custody.”

3: Page 3, line 12, at end insert-

““custody” includes being held in prison, secure mental healthcare facilities, secure children’s homes, secure training centres, immigration removal centres, court cells and police cells, and being subject to supervision by court, prisoner and detainee escort services;”

5: Clause 3, page 3, line 37, leave out “or (b)” and insert “, (b) or (d)”

6: Page 3, line 40, leave out “or (b)” and insert “, (b) or (d)”

10: Clause 5, page 5, line 8, leave out “or (b)” and insert “, (b) or (d)”

The Commons disagree to Lords Amendments Nos. 2, 3, 5, 6 and 10 but propose Amendment No. 10A in lieu—

10A: The Commons disagree to Lords Amendments Nos. 2, 3, 5, 6 and 10 but propose Amendment 10A in lieu- Page 2, line 43, at end insert-

“(5A) The Secretary of State may by order make amendments to this section to the effect that a duty of care owed by an organisation under the law of negligence to a person who-

(a) is in any specified form of custody or detention, or is otherwise on premises of a specified description or on premises in specified circumstances, and(b) is by reason of that fact a person for whose safety the organisation is responsible,is a “relevant duty of care”.

(5B) An order under subsection (5A)-

(a) may amend this Act so as to specify exceptions with respect to the application of any provision contained in this section as a result of such an order;(b) may make any amendment to this Act that is incidental or supplemental to, or consequential on, an amendment made by such an order.(5C) An order under subsection (5A) is subject to affirmative resolution procedure.”

My Lords, I beg to move Motion A, That the House do not insist on its Amendments Nos. 2, 3, 5, 6 and 10 and do agree with the Commons in their Amendment No. 10A in lieu.

I am delighted to join the debates on this Bill. I am particularly pleased to stand here today as a Minister from the new Ministry of Justice. I pay tribute to my noble friends Lady Scotland and Lord Bassam and to my noble and learned friend the Attorney-General for their work in bringing this Bill to the point that it has reached today.

The Ministry of Justice marks a new departure and provides an opportunity for the whole justice system to work together better than even before. I am determined that we make the most of that opportunity. I am also pleased to be participating in debates on this particular Bill, as it reaches its conclusion. This important Bill has been a long time in the coming. It has received support from noble Lords from all sides of this House and in the other place, and discussion has been probing and constructive. Discussion of the Bill now draws to a close and one issue remains outstanding between this House and the other place: whether the offence should extend to custody. That issue returns to us for consideration again, with an opportunity to complete this Bill’s parliamentary passage. I am grateful to the noble Lords, Lord Lee, Lord Hunt of Wirral and Lord Dholakia, the noble Baroness, Lady Stern, and the noble Lord, Lord Ramsbotham, for the time that they have given me to discuss informally the provisions in this amendment.

We have listened carefully to the debate on this and strived to find a constructive way forward. In the other place, my honourable friend Mr Gerry Sutcliffe set out three proposals aimed at addressing the concerns here. At the heart of these lies the amendment proposed by the other place: a power to extend the Bill to custody. This is offered in lieu of the preference of your Lordships’ House, which was to extend the new offence to custody from the outset. The order-making power does not shy away from its purpose. It is explicit and refers directly to extending the offence to custody and detention. It therefore puts the principle of extending the offence to custody clearly in the Bill. Noble Lords will want me to address why we set store in this being an order-making power rather than a straight extension of the offence.

Noble Lords who have followed this Bill closely will know that lifting Crown immunity in this Bill represents a very significant step, but it also brings with it substantial uncertainties about the consequences of making government departments liable to criminal prosecution for the first time. It is right that the new offence should apply to matters such as employee and workplace safety. Those matters, by and large, will not involve significant questions of public policy.

However, the distinction between operational matters and policy becomes more blurred when the issue is one of how a public body discharges its statutory or public responsibilities. It is not enough to say that these are matters of management and not policy. Faults may well lie in management but disentangling those faults from the wider policy context in which they arose can be difficult. We do not believe that the offence should become a vehicle for seeking to examine policy decisions for which Parliament holds the Government to account.

Noble Lords will also understand that the Ministry of Justice has itself only recently been established. We need to discuss carefully with those who would be affected by the extension of the offence, such as the Prison Service and police forces, what the implications would be and how implementation can be managed sensibly. Until we have had a chance to consider how the legislation has bedded down across the public sector more widely, it would not be wise to look to extend it to the way particular public functions, such as managing custody, are carried out.

However, I am very clear that the proposal to include an order-making power in the Bill is done in good faith. It is done because we believe that it is right that the offence ought to be capable of applying to custody. We would not have done that if it was our intention never to exercise the power. The power therefore clearly opens the door to the offence applying to custody—a very significant step in itself—and we would not have done that if we were not prepared to take that further step ourselves.

In the mean time there will be an opportunity to put the ombudsman on a statutory footing, strengthen the arrangements for the Forum for Preventing Deaths in Custody, and allow those changes to bed in. A statutory footing for the ombudsman will change significantly the basis on which investigations into deaths in custody are conducted, and there is some sense in allowing those changes to become established before seeking to make further changes.

I shall set out in a little more detail the changes I have just mentioned. The ombudsman, Stephen Shaw, has investigated all deaths in prisons, young offender institutions and immigration detention centres since 2004 and, since last year, those in secure training centres. Through this and his wider work investigating complaints, he and his office have developed detailed knowledge of the management of custody. Putting his office on a statutory footing will strengthen the investigation of deaths in custody in three ways. First, there will be a formal duty on the ombudsman to examine all deaths within his remit. He will also decide the scope of investigations and the procedures to be adopted. His remit would extend to the treatment of and conditions for prisoners. As now, we would expect investigations and recommendations to cover management and wider policy issues where he deems it appropriate. Secondly, there will be new High Court powers to obtain evidence, as well as a clear foundation for working with other ombudsmen where appropriate. Thirdly, while the ombudsman is already independent of the organisations he investigates, a statutory basis would strengthen his independence from government.

Noble Lords will want to know when we intend to bring proposals for this legislation before the House. I cannot name a particular vehicle but our intention is to find a suitable Bill in this Session or, if necessary, the next. The Government’s second proposal is to look at the further development of the Forum for Preventing Deaths in Custody. The word “review” has been used but I make clear for the benefit of the House, especially the noble Baroness, Lady Stern, who I see in her place, that the purpose here is to look at how we can strengthen the forum. I believe that the phrase the noble Baroness used to me was, “make sure that you beef it up”.

The forum brings together a wide range of organisations involved professionally in the management of custody and its inspection and scrutiny. It includes representatives from the Prison Service, Department of Health, Youth Justice Board, Association of Chief Police Officers, Inquest, the Prison and Probation Ombudsman and the prisons inspectorate. It is chaired by John Wadham, the deputy chair of the Independent Police Complaints Commission, and its membership also includes the noble Baroness, Lady Stern, as an observer.

The forum stems from the Government’s response to recommendations from the Joint Committee on Human Rights for a task force dealing with deaths in custody. It works by comparing and contrasting approaches, identifying good practice and drawing attention to issues which need to be addressed by operational bodies or Ministers.

Its terms of reference are:

“The Forum exists to learn lessons and effect change to prevent deaths in custody”.

I understand that its first annual report is being prepared. It has made a good start in meeting some of the criteria that the committee set for a task force, but we acknowledge that there is room for improvement.

For this critical area of work to be effective, a strong focus needs to remain on personally involving senior representatives from organisations that inspect, investigate and oversee custody. In the review, we will look at issues such as greater autonomy from government and improved interaction with Ministers, including the relationship with the ministerial round- table on suicide, which my honourable friend Gerry Sutcliffe chairs, its powers, resources and capacity. The noble Lady, Baroness Stern, is, I understand, already in early discussion with the forum’s chairman about a seminar to explore views. That seminar would be an integral part of the review, and we will report on progress within six months.

These two proposals are squarely aimed at some of the key concerns that have arisen in the debate on custody: that there should be strong arrangements for the independent investigation of all deaths in custody to find out exactly what happened and to make recommendations for change; and that the Government must take further steps to improve the management of custody to prevent these deaths from occurring in the first place. In addition, we propose a power to extend the offence to custody to enable us to take that further step when the time is right.

I pay tribute to the efforts of all Members of your Lordships’ House and the other place for their efforts in getting this legislation to the point that we have reached today. A single issue remains to be settled. The Government have sought to move positively on this matter and have offered a package aimed at the core issues of preventing and investigating deaths in custody, as well as opening the door to the Bill’s extension. That is a significant move, and I commend the amendment in lieu to the House as a basis on which this Bill can now be brought to a successful conclusion.

Moved, Motion A, That the House do not insist on its Amendments Nos. 2, 3, 5, 6 and 10 and do agree with the Commons in their Amendment No. 10A in lieu.—(Baroness Ashton of Upholland.)

My Lords, I beg to move, as an amendment to Motion A, Motion A1, leave out from “House” to the end and insert “do insist on its Amendments Nos. 2, 3, 5, 6 and 10 and do disagree with the Commons in their Amendment No. 10A in lieu”.

When this House debated these amendments on 5 February, I argued then, as I do now, that my purpose was to rectify a glaring deficiency in what was otherwise a generally welcome Bill by including,

“a duty owed to anyone held in custody”.

I emphasised that there was a stark difference between the rule of law and the Bill on the one hand and, on the other, the Government’s perverse reasoning as to why neither the rule of law nor their own Bill should be applicable to those with a duty of care to those held in custody.

I must acknowledge how far the Minister and the Government have moved since then on this issue, in good faith, and I thank her personally for the courteous, frank and open way that she has discussed and explained her case for continuing to reject my amendment. She rests her case on the three concessions that she has described, which were debated at length in the other place.

The first is the strengthening of the arrangements for the independent investigation of deaths in custody by putting the appointment of the Prisons and Probation Ombudsman on a statutory footing. I welcome that, but I remind the House that that measure has a long history that is nothing to do with this Bill. When Her Majesty’s Inspectorate of Prisons was reformed in 1981, three aspects of imprisonment were under consideration for inclusion in that role. In the event, inspection of the efficiency and propriety of the treatment and conditions of those in custody was put on a statutory footing but not the inspection of grievances.

It was not until 1994 that the first Prisons Ombudsman was appointed to do that. Since then, successive holders of the office have fought, unsuccessfully, to be put on a statutory footing similar to that of the Chief Inspector of Prisons. In addition, the Joint Committee on Human Rights made a recommendation to that effect in 2003. I acknowledge that the investigation of all deaths in prisons, young offender institutions and immigration detention centres has been added to his remit since then, but the investigation of grievances remains his principal task, requiring a statutory footing.

The second concession is to review and strengthen the role of the forum on deaths in custody, as has been fully described by the Minister. The forum’s current remit is to identify and draw ministerial attention to good practice and issues relating to changes and improvements to safety in custody that require further attention. When discussing this House’s amendments in the other place, the Minister, Mr Gerry Sutcliffe, to whom I also pay tribute for his movement on these amendments, announced that the forum would report on its review within six months. I welcome that in the context of safety in custody but, important though that is in its own right, it is not the principal subject of this Bill.

Thirdly, the Government propose to give the Secretary of State the power to amend the Bill by affirmative resolution to increase the categories of duty of care. Mr Sutcliffe said in another place:

“We have accepted the principle that the new offence may extend to custody at some time in the future”.

He also said:

“Although the power that we are proposing does not bring custody into the Bill, it leaves the door open to doing so without primary legislation”.

Immediately, that movement was recognised by Mr Chris Mullin, who asked:

“Will the Minister give us some idea of the timetable he has in mind? When will that day dawn?”—[Official Report, Commons, 16/5/07; cols. 667-69.]

I submit that that is and remains the crucial question. In accepting the principle underlying the new offence—namely, that everyone is equal before and entitled to equal protection under the law—the Government are accepting that its purpose and content apply to failures of management in the duty of care when it is owed by government departments and other Crown bodies. I cannot for the life of me see why, having accepted that in the context of a Bill that is subject to carryover procedures, they cannot go further and draw up a clear timetable, as they have done for the review of the forum.

Since 5 February, I and, I suspect, many other noble Lords have been put under considerable pressure by relatives and other pressure groups representing those who have died as a result of corporate negligence outside custody. This pressure includes the suggestion that, by representing the case of relatives who have died as a result of corporate negligence inside custody, we are putting the Bill at risk. I am sure that none of those who voted for these amendments wishes the Bill to be killed; we wish only that the Bill that is passed is better than the one that was originally brought before this House. Mr Dominic Grieve urged Members in the other place,

“to look to their consciences on this matter, because the House has an opportunity to do some good”.—[Official Report, Commons, 16/5/07; col. 674.]

Noble Lords will remember that, when we discussed these amendments on 5 February, the noble Lord, Lord Dholakia, and others made the point that we are not suggesting that every death in custody should automatically be followed by a charge under this Bill; we are talking only about those that involve gross breaches of management and the duty of care. Since that date, there have been at least two further cases of avoidable and gross breaches of management: the murder of Shahid Aziz in Leeds prison, in depressingly similar circumstances to the murder of Zahid Mubarek in Feltham, and the suicide of Michael Bailey in Rye Hill, which attracted scathing remarks from the coroner about management failure. The depressing continuance of avoidable deaths in circumstances for which the Government are responsible is surely a very strong reason for bringing the now accepted principles behind the Bill into effect as soon as possible. I was therefore very concerned to read a report in the Observer on 29 April, referring to our vote on 5 February, which stated:

“The defeat has prompted fury at the Home Office, which believes the peers’ plan would be unworkable, as it would place an impossible burden on the Prison Service to prevent deaths in custody”.

That fury implies that proper management is not currently being carried out by the Prison Service regarding the duty of care that it owes to all those in its custody. If that is true, I am sure that it will be of considerable concern to the Minister.

As I said on 5 February, these amendments are not about examining government policy or the allocation of resources; they are, in line with the remainder of the Bill, about good management. Improved management supervision was one of the recommendations that I made to the Government in1999 in a thematic review of the prevention of suicide in prisons, Suicide is Everyone’s Concern, conducted at the request of the then Minister, Joyce Quin—now the noble Baroness, Lady Quin—and accepted by the then Home Secretary, Mr Jack Straw. Good management does not depend on resources but, rather, on the whole ethos, structure and direction of management. That is what the Bill and the vote of this House are all about.

Moved, as an amendment to Motion A, Motion A1, leave out from “House” to the end and insert “do insist on its Amendments Nos. 2, 3, 5, 6 and 10 and do disagree with the Commons in their Amendment No. 10A in lieu”.—(Lord Ramsbotham.)

My Lords, when we last debated this Bill in your Lordships’ House in early February, we saw the House at its best. Opposition parties rallied behind the noble Lord, Lord Ramsbotham, whose knowledge and experience on the deaths in custody issue is recognised by all sides in the Palace of Westminster and beyond, and inflicted a heavy defeat on the Government. There was virtually no support for the Government’s stance from their own Benches, and even Ministers were hard pushed to find serious, sustainable arguments to justify their position.

We had hoped that, on reflection, given the scale of the defeat, the Government would accept our amendments but, with John Reid in overall charge of the Home Office, we were not optimistic. However, the creation of the new Ministry of Justice offered fresh hope. I categorise politicians into two broad groups: warriors and healers. John Reid, as the Cabinet bull terrier, was unquestionably a warrior, while I suggest that the noble and learned Lord the Lord Chancellor and new Secretary of State at the Ministry of Justice is more of a healer. He has an avuncular presence, beautifully described, I remind the House, by the Leader of the Official Opposition in this Chamber some time ago as delivering more ho-hos than a Father Christmas in a department store.

How fitting it would have been if the first act of the new Ministry of Justice had been to grant justice to those who die in custody and bring them within the scope of this important corporate manslaughter Bill. Sadly, it was not to be. The new Ministers and their civil servants searched for a way out of their dilemma and came up with a package of modest improvements to the Bill, clearly buying off doubters on their own Benches in the other place. However, that should not have been particularly difficult, given that those Back-Benchers were obviously focused elsewhere. Half the Parliamentary Labour Party was engaged on active service north of the border fighting the SNP, while the other half was back at Westminster fighting each other for the deputy leadership of the Labour Party.

But this is a serious issue. Putting the Prisons and Probation Ombudsman on a statutory footing is to be welcomed, as, I suppose, is a strengthening of the Forum for Preventing Deaths in Custody, although few seem to have heard of this body and I can find no reference to it in earlier ministerial contributions on the Bill. The affirmative resolution merely puts off, possibly till tomorrow, what should be done today.

Having participated in debates in this House and having studied in Hansard what was said in the other place last Wednesday, I have to say that no substantial arguments have been put forward for the non-inclusion of deaths in custody in the Bill. Yes, there are hints of the police becoming risk-averse, of prison overcrowding and perhaps of problems with the Prison Officers’ Association but nothing substantial.

For the near 12 months that I have had the privilege to be a Member of this House, I have seen and heard the Minister at the Dispatch Box on many occasions. I genuinely believe that she is a sincere and caring Minister who, if it were up to her, would wish to include deaths in custody in this Bill. It is our wish too.

My Lords, I start by declaring my interest in the register as a practising solicitor. I, too, join the noble Lords, Lord Ramsbotham and Lord Lee of Trafford, in paying tribute to the Minister. She has, as the noble Lord, Lord Ramsbotham, said, been courteous, frank and open. I thank her for that and for her willingness to find a way through the problems that have arisen. I welcome her to the Dispatch Box in her ministerial role in the new Ministry.

I hope that the Minister understands that this is a hugely significant debate for many of us. Matters of constitutional importance are at stake. The first point that I want to make is that the amendments passed by this House by a substantial majority earlier this year were serious, positive and constructive. As the noble Lord, Lord Lee of Trafford, put it, it showed the House at its best. Those amendments greatly enhanced the Bill and restored balance to it. They were entirely consonant with the primary purpose of this important legislation, and in no way conflicted with or undermined it. They did not emasculate, vitiate or weaken it. Indeed, the amendments unambiguously extended the remit of the Bill to protect some of the most vulnerable people in any country—those who are incarcerated, whom the state has deprived, legitimately, of their liberty.

This is what the Minister described as the single issue, but we on all sides would stress that this single issue is a serious and profound one, because holding individuals in custody is a massive responsibility for any Government in any country in any era. Exemption from the full extent of that responsibility is unacceptable. In seeking to reject these amendments, Ministers are effectively refusing to concede that they and other agents of the state owe a full, total and transparent duty of care to those they hold in custody. They have never explained why. I would venture that they have not made the argument because there is none. There is certainly a case for arguing that, by exempting themselves in this way, the Government are running the risk of ending up in breach of Article 2 of the European Convention on Human Rights. There was an interesting if inconclusive debate on this at Report. Far more importantly, this is an argument about natural justice. Is it not now time for Ministers to accept and acknowledge that the existing systems of accountability for death in custody are regarded by many people as pretty useless?

Reference has been made to a report in the Guardian last Friday, in which an inquest jury was described by Vikram Dodd and Eric Allison as having delivered a “devastating verdict” when it criticised the Prison Service for allowing a violent white prisoner to remain in a cell with an Asian man whom he later beat and stabbed to death. That report was only last Friday. The statistics are worrying. The families in that case and in the Mubarek and Scholes cases had to endure the most difficult processes in addition to the grief of losing a loved one. Can Ministers really be arguing that bereaved people in search of justice and answers should have no easier recourse than to take the Government to the Court of Appeal just to get an inquiry? The Bill should be even-handed; there should be one rule for all. In an outstanding speech in another place, my colleague Dominic Grieve, the shadow Attorney-General, said that if this House were to prevail—and he were to take on that responsibility in government—he would accept that this was the right way forward.

Of course the suggested compromise deserves our scrutiny and careful thought, but it is unsatisfactory for a number of reasons. First, the inadequate function of the amendment itself just provides an order-making power to add deaths in custody to the public functions that the legislation will cover, but there is no guarantee that that power would ever be used. The Minister has virtually indicated that it would, but the Minister in another place stated unequivocally that there was no guarantee that the order would be used. He said:

“the development of … processes will lead us to consider whether to use the affirmative procedure”.—[Official Report, Commons, 16/5/07; col. 667.]

—that is, the affirmative procedure for bringing forward this order. To my mind, that renders this proposal, well intentioned as it may be, little more than a smokescreen.

There is, of course, another reason to be clear and unambiguous in the Bill. I know that the Minister is in rude health, but she is a member of a Government in transition. I have no wish to use the phrase “somewhat undead”, but we are now in between Governments. We have an outgoing Prime Minister and an outgoing Home Secretary. Any oral commitment, however well intentioned and sincere, will not bind anyone with a new Administration that is mere weeks away.

The noble Lord, Lord Ramsbotham, has provided a comprehensive critique of the ombudsman and forum proposals. Following that, suffice it for me to say that those proposals look flimsy, insufficient and inappropriate in the light of his analysis. They are no substitute for a full and fair extension of this legislation to protect a group of people, those held in custody, who are entirely and uniquely at the mercy and under the protection ofthe state and its agents. As the noble Lord, Lord Ramsbotham, said, this is a glaring deficiency.That is why I urge my colleagues and the House wholeheartedly to support the Motion standing in the name of the noble Lord.

My Lords, I welcome the concessions which the Minister has already set out. I join others in congratulating her on how that has happened and how those views have been put forward today. I reflect upon what I said to your Lordships’ House when this was debated at length on 5 February, and I repeat: in any developed country which believes in itself and its tradition, a litmus test of that society is how it treats prisoners held within the official places of incarceration. They are listed, and need no further comment from me; police cells are one and prisons are another, as the noble Lord, Lord Ramsbotham, has indicated.

It seems that we hold up our hands in horror time and time again at what we see taking place in banana republics, in central African republics and, on occasions, in Middle Eastern republics. We look at how prisoners are frequently treated in those places and congratulate ourselves on how we do things differently in this country. Of course, by and large, we do, and, by and large, we have something which we can be proud of in this country. If that is the case, why are we pursuing this debate today? What have we got to hide? Why raise questions in the minds of those who seek to criticise about our seeking officially to exclude ourselves from something which seems patently clear? As a civilised country, we should be prepared to offer ourselves up for examination on the way in which we conduct prisons, police cells and so forth.

The noble Lord, Lord Ramsbotham, has already commented upon prisons, and I, declaring an interest, of course wish to comment about those held in police custody. When, in February, I checked the official ACPO view, it was that it was rather surprised that there were moves to exclude the police from the Bill. Now, I understand that a letter is in circulation in which the official ACPO view is expressed, which is that it is quite happy to be excluded from the Bill and to enjoy the exclusions that apply to prisons and elsewhere. This morning, I checked with the ACPO spokesman, and he told me that, in coming to that view, ACPO found it a borderline decision, but was still happy to find itself outside the compass of the Bill. I have to tell noble Lords what I told him; that I was extremely disappointed to hear that. I would have thought that a mature service that believed in itself would have nothing to fear and nothing to hide. I do not speak with any remit—nor would I speak with a remit on behalf of ACPO—when I say that I believe that the police should be included along with prisons and the other organisations and places that we are aware of. I think that ACPO is wrong and that we in this country should be prepared to be transparent and to expose the circumstances of what happens in our prisons, our cells and elsewhere to court examination. For that reason, I support Motion A1.

My Lords, many of us on this side of the House who support the Government are concerned that we get an answer on this so that the Bill gets on to the statute book. I remind the House that the Corporate Manslaughter and Corporate Homicide Bill, which has enormous support in the trades union movement, has a much wider footprint than simply police and prisons. I shall come to them in a moment, but we ought not to lose sight of the tremendous advance that the Bill will make in the protection of millions of workers. That is a question that the noble Lord, Lord Hunt of Wirral, is professionally very seized of. We are very anxious to see the Bill get on the statute book.

When it comes to the progress made by the Government in ensuring that the police and the prisons will be covered by the legislation, the noble Lords, Lord Hunt and Lord Lee of Trafford, failed to draw attention to the quite narrow point now at issue. The noble Lord, Lord Hunt, referred to obiter dicta by Mr Gerry Sutcliffe—I think I am quoting him accurately in distinguishing the issue of whether the order would be used rather than when it would be used. I shall ask him a question in return. If it were possible to say that the issue was when the order would be used rather than whether it would be used, would that make a difference to his attitude? We cannot go on for ever playing with words, but that is a substantial point. My understanding is that there will now be progress. To make this happen in the prisons and police stations overnight, as it were, is an issue, and I am not surprised to hear the careful discussions that are taking place. For those of us on this side who are voting for the Government on the basis that this will happen, it is a question of when and not whether. The noble Lord, Lord Hunt, can give further consideration to the matter if that point worries him. I also put the same point to the Minister.

My Lords, we, from this side of the House, support the powerful case made by the noble Lord, Lord Ramsbotham. We went into the Lobby with him on the previous occasion, and we would join him again if he were to call for a Division. I have no problem with the implication of the noble Lord, Lord Lea, that the Bill is much wider than simply the two aspects—police cells and prison cells—we are talking about. If so, why exclude these two very important areas from the Bill? If the Government were to include them, the Bill could become an Act and there is no problem.

It is important to remember what the noble Lord, Lord Hunt, rightly said a little while ago; that the original amendment to bring deaths in police custody and prison custody within the ambit of the Corporate Manslaughter and Corporate Homicide Bill received very strong backing when it was before your Lordships’ House: it had a substantial majority.

Today’s debate on the Commons amendment does not help to rectify the anomaly that many noble Lords pointed out last time. I do not underestimate in any way the work of the prison ombudsman, but this matter is far too important simply to be left to investigation. We would like to ensure that no one is excluded from this legislation.

I say straight away—and a number of people have complimented the noble Baroness on her performance on other Bills—that she is a listening Minister. I hope that she will listen very carefully to the arguments advanced and that there will be a way to move forward on this issue. We cannot deny that there is a slight movement in our discussions with the Minister on the Government’s part, but it is not sufficient to allay our fears about lack of action on deaths in a custodial situation. We need to bring to task those who fail in their duty of care when persons are placed in police or prison cells.

I do not see why the Government should be worried. It would not of course mean that all or most deaths in custody would result in prosecution for corporate manslaughter, as pointed out by the noble Lord, Lord Ramsbotham. That would apply only when, exceptionally, there had been a gross breach of the relevant duty of care. In those circumstances a prosecution for corporate manslaughter should enable the courts to hold that a serious management failure had occurred resulting in an individual’s death.

I note that it is no longer the Government’s case that deaths in custody should be exempted from the scope of the Bill. I hope that is the case because I can well understand that there is a need for discussions with the Prison Service, as the Minister mentioned earlier, and the police. I do not dispute that. That is right and how it should happen.

Let me advance some of the arguments mentioned by the noble Lord, Lord Dear, about the police. I have looked at the response from ACPO, the Association of Chief Police Officers. It argues that mechanisms are already established to ensure that all such incidents are robustly and independently investigated. However, the IPCC, the Independent Police Complaints Commission, the one body with an independent oversight on policing matters said on the Government’s draft Bill for reform:

“The consultation paper suggests that the reason for not applying corporate manslaughter to public functions is that this would conflict with existing accountability mechanisms … In fact, it would complement them. All deaths following police contact have to be referred to the IPCC, and some of these will be independently investigated. If the evidence from such an investigation showed the most appropriate way forward was a corporate manslaughter prosecution, it would cause serious public concerns about the effectiveness of public accountability if this was not an option”.

The commission pointed out that at present in a case of serious systematic failure resulting in death,

“there could be a disproportionality whereby a death occurs and the only sanctions available are minor disciplinary sanctions against individual officers”.

This is wholly unsatisfactory, and the Commons amendment goes nowhere near the original amendment to rectify it.

I am aware that the Ministry of Justice is in consultation with the governors of prison establishments on this subject and requires more time to conclude that discussion. That is unacceptable. There are still grieving parents, who have no answers to the question of how many vulnerable youngsters have died. I have secured a number of debates in your Lordships’ House on deaths in custody, but I have never succeeded in getting the Home Office to set up an independent inquiry. We cannot allow this situation to continue for the next year or two. A private company running a business could be liable to a charge of corporate manslaughter, but a public service charged with the care of particularly vulnerable people behind locked doors and high walls would not. That cannot be right. Indeed, it is indefensible; because of the particularly vulnerable position of prisoners, we should take special care to protect their lives. Even more indefensibly, a private company running a prison would not be liable to prosecution for corporate manslaughter, although a private company running any other kind of business would be liable to such a charge.

Let me conclude by repeating what the House of Commons Home Affairs Select Committee and the Work and Pensions Select Committee concluded in their joint report on the Bill:

“there is no principled justification for excluding deaths in prisons or police custody from the ambit of the offence ... where deaths in prisons and police custody occur, they should be properly investigated and the relevant bodies held accountable before the courts where appropriate for an offence of corporate manslaughter”.

The Government must give way, and must do so this time by sending our concerns back to the Commons one more time so they are taken into account.

My Lords, may I ask one question? Is it not the case that the Government, on the advice of the Home Office, have deferred to representations from the Prison Officers’ Association, which is directly involved in this?

My Lords, this subject is vital, as is the Bill, and I entirely agree with the view that the Bill should become an Act as soon as possible. When this matter was debated before, certain arguments in principle were put as to why this provision for corporate manslaughter should not apply to prisons and the police. I found those arguments very difficult to follow, although they were ably presented by the Attorney-General. However, it is now clear that the Government have no confidence in them, because they have agreed that a power should be put into the Bill to extend the corporate manslaughter provisions to these agencies. Therefore, the only argument left is when this should happen, or at least whether it should happen in the form in which it is put. I humbly suggest that if there is some difficulty of timing,the proper way in which to handle this is to makethe statutory provision work but subject to a commencement order. In other words, the Bill should be passed in accordance with the amendment tabled by the noble Lord, Lord Ramsbotham, and should then be considered when various parts of it are brought into force as part of the commencement arrangements. No other argument addresses the situation better than that.

My Lords, I strongly support the argument put forward by the noble and learned Lord, Lord Mackay. On listening to the noble Lord, Lord Ramsbotham, I was very much struck by the strength of the argument that the principle has already been accepted by the Government. It may be that I am rushing in where angels fear to tread, but what is the difficulty in therefore having these provisions in accordance with the Lords’ amendments to the Bill? I strongly support Motion A1.

My Lords, I am extremely grateful to noble Lords for putting forward—with great passion and very succinctly—the arguments against what the Government seek to achieve. I understand the strength of feeling in your Lordships’ House. First, I shall tackle a couple of the specific points. In response to the noble Lord, Lord Campbell of Alloway, there has been no official contact with the Prison Officers’ Association and no submissions from it during scrutiny, which I hope deals with that point quite quickly.

The noble Lord, Lord Lee of Trafford, described my Secretary of State, the noble and learned Lord the Lord Chancellor, as a healer as opposed to a warrior. I think that he would quite like a bit of hybridity, for he can be a bit of a warrior, as the noble Lord, if he has not seen already, may see in the future. I also agree that he is a healer and he listens. It is precisely because the Ministry of Justice has listened that we have brought forward the amendments before your Lordships’ House today. That is what noble Lords would expect and I am sure that the noble and learned Lord, Lord Mackay of Clashfern, would recognise that it is important that the ministry is seen to do that and to take on board the questions that have been raised.

My noble friend Lord Lea of Crondall talked about the breadth of this Bill. It is probably worth reminding ourselves that the concern that led to the Bill and the approach to corporate liability for manslaughter came from a number of high-profile cases, with which noble Lords will be very familiar, in which many people lost their lives; namely, the Zeebrugge disaster in which the “Herald of Free Enterprise” capsised and sank, the Piper Alpha oil rig fire, the “Marchioness” tragedy, and a number of terrible incidents on the railways including Southall, Ladbroke Grove and Hatfield. However, work-related death is not confined to incidents such as these and has touched the lives of many families who have lost spouses, children or parents at work. The Bill is equally applicable to those cases.

I know that noble Lords will join me in saying to all of the families who have suffered these terrible tragedies that our hearts go out to them and that our united purpose is to get this legislation on the statute book in order to protect them. We have all received letters from individuals who feel extremely concerned about that. I take it that your Lordships share with me at least that we are trying to find a way to get this on the statute book as quickly as possible. It is in that spirit that I hope those who read our deliberations will recognise that, for I am nervous that some people who have written to us are deeply concerned that this issue which stands between us should prevent the Bill reaching the statute book. I know that there is no shred of an intention for that from any noble Lord who has spoken about the issue, which they feel passionately about. I would want all those listening to our deliberations to understand that.

Noble Lords who have dealt with the Bill all the way through its stages will know well how it is intended to operate and the new and unprecedented step that we have taken in lifting Crown immunity. As I said in my opening remarks, never before have government departments been liable to criminal prosecution, which will be the case under the Bill. The Bill also recognises the difficulties inherent in seeking to apply the criminal law to difficult issues of public policy and public responsibilities. Noble Lords discussed with my noble friends who took parts of the Bill through the issues around the Army, the police and the emergency services. The Bill offered to your Lordships’ House strikes the right balance.

As ever—the noble Lord, Lord Hunt of Wirral, talked about this—the Bill has been improved in this House. Noble Lords made amendments that extend the range of organisation covered by the new offence, so it applies to certain unincorporated bodies, such as partnerships, trade unions and employers’ association where these are employers. Amendments were made to strengthen the range of sanctions available to include a new publicity order, which will allow the courts to require an organisation to publicise details of its conviction, which could have a salutary effect on large organisations where corporate reputation is extremely important. There is much that is good in the Bill, but the issue of custody has divided the House and is one of the few areas on which we have not been able to reach a consensus.

The noble and learned Lord, Lord Mackay of Clashfern, said that we could bring in the Bill and simply not commence the provisions that would apply to this. I prefer the route we have taken, which is to be clear about the issues we want to address, to look at the implications in terms of operation and policy, and to bring it forward for formal debate in your Lordships’ House by affirmative order to demonstrate precisely what we have done, and of course enable noble Lords to debate it effectively. For me, that is a better way forward. However, the noble Lord, Lord Lee of Trafford, said that he thought that perhaps I wanted to do this now. It would be a lot easier for me if I did, but it is my job as a government Minister to listen carefully to representations. Although I do not have policy responsibility, noble Lords know that I listen both to colleagues and to those interested in and concerned about legislation. Part of being responsible in government is to make sure that when you say you will do something, you have thought through all the implications and worked through the potential problems. In this area I believe that there are issues we need to address with those working in the services, and as a new ministry, we need to address them too.

For all these reasons, I believe that our course is responsible and right. I take nothing away from the strength of feeling expressed by noble Lords and the principle lying behind what is sought here, but we believe that the way we have provided for this in the Bill demonstrates that we have listened, we have moved our position, and in good faith present the provision now before noble Lords. I hope that they will take on board what the Government are seeking to do and allow the Bill, which has so many good provisions in it, on to the statute book in order to help protect many people in the future.

My Lords, I am sure that I can speak for all noble Lords in thanking the Minister for the clarity with which she has explained her position, but she will not be surprised to hear me say that I do not think that the Government have gone far enough. The noble and learned Lord, Lord Mackay of Clashfern, put it clearly by saying that the one word missing from all that has been said is “when”. My noble friend Lord Dear, whom I listened to with considerable care, also put his finger on one of my reasons for not being entirely satisfied when he said, “I think that this will happen”. When the noble Baroness reflects on what has been said in this serious and well conducted debate, reflecting as ever the gravity with which this House treats such issues, she will also reflect on the spirit and experience behind those who have spoken and where they come from. It is extremely important that this Bill, which is nearly there except for the question of “when”, should go back to those responsible for trying to produce an answer. As the Minister explained, I realise that certain very senior political arms have been pushed nearly as far up their backs as it is possible to go, but from military experience I know that they can always go just a little further. I therefore wish to test the opinion of the House.

Housing: Home Information Packs

My Lords, with the leave of the House I shall repeat a Statement made in another place by my right honourable friend Ruth Kelly. The Statement is as follows:

“With permission, I would like to update the House on the Government’s proposals for the implementation of home information packs. It had been the Government’s intention to implement home information packs, including energy performance certificates, on 1 June. In debate last week, reference was made to the judicial review requested by the Royal Institution of Chartered Surveyors. This judicial review focused on energy performance certificates, not home information packs. On Wednesday, the judge issued an interim order which was received by my department on Thursday. That order would have effectively prevented the introduction of energy performance certificates on 1 June while the case was being considered. The Government believe that introducing home information packs without energy performance certificates would be neither practical nor acceptable. It is important to introduce energy performance certificates and home information packs at the same time because cutting carbon emissions should go hand in hand with market transformation.

“We have been in detailed discussion with RICS to prevent lengthy legal delays. The Government and RICS are committed to the swift and smooth introduction of both home information packs and energy performance certificates. I am pleased that we have today reached a pragmatic way forward that gives certainty and allows us to get on with implementation. As a result, we are proposing to withdraw the Home Information Pack Regulations to clear the way for successful implementation of revised arrangements. Although the issue of the judicial review is now resolved, long-running uncertainty has already had an impact on the number of energy assessors. For implementation on 1 June, we would need at least 2,000 to be accredited, with over 2,500 by the end of the month.

“Today, I am updating the House with the latest figures. There are more than 2,500 people currently in training. A further 3,200 have already passed their home inspector or domestic energy assessor exams. Of those, 1,500 have been accredited or have applied for accreditation, but only 520 of them have been fully accredited. These figures show that the number of assessors is unlikely to meet our needs in time for implementation on 1 June. Equally, they show that, in the long term, there will be enough assessors to meet demand.

“The Government remain convinced of the importance of home information packs and energy performance certificates. Home information packs will cut costs and delays in buying homes. Energy performance certificates will help reduce energy bills and cut carbon emissions from our homes, which, as they make up 27 per cent of our national carbon emissions, could make a big difference in our effort to tackle climate change. The measures in energy performance certificates will cut carbon emissions by nearly 1 million tonnes every year.

“I have always said that the right test of the legislation should be how it brings benefits for the consumers and how it protects the environment. Today, therefore, I am setting out a practical way forward. I propose to change the start date for home information packs to 1 August and intend to phase their introduction. From 1 August, home information packs, including energy performance certificates, will be required for the sale of four-bedroom properties and larger. These are the properties where there is the greatest potential to make energy efficiency savings. This will ensure work for those energy assessors who have already been trained and accredited. We will extend the requirement to smaller properties as rapidly as possible, as sufficient energy assessors become ready to work. As we see the number of accredited assessors rise, so more properties will be included in the system.

“We are also introducing a number of transitional measures. First, until the end of the year, we propose to allow people to market their properties as soon as they have commissioned a pack rather than make them wait until they have received it to avoid unnecessary delays when the systems are introduced. Secondly, to allow energy performance certificates to be implemented at the earliest opportunity, we will make amendments to allow energy performance certificates to be up to 12 months old when the property is put up for sale, extending the current three-month limit. Thirdly, we are inviting councils and registered social landlords to work with us to introduce energy performance certificates on a voluntary basis in social housing; for example, at the time of stock transfers. This will also provide work for energy assessors at an early opportunity. I will shortly bring forward revised regulations to implement the changes that I have outlined.

“Towards the end of the year, we will assess the implementation of home information packs and consider what further steps might be needed to maximise the reduction in carbon emissions and drive forward the reform of home buying and selling. This assessment will be informed by the operation of the market from 1 August, by the results of the area trials and by further consultation on the next steps in implementing home information packs and energy performance certificates, which we will begin in the summer.

“The approach that I have set out gives clarity to everyone about the next steps. It delivers home information packs and energy performance certificates. It removes uncertainty for energy assessors and others, and ensures a smooth transition for people buying and selling their property. Most importantly, it provides an opportunity to make real progress towards cutting carbon emissions from our homes”.

My Lords, that concludes the Statement.

Oh dear, my Lords, oh dear. One can have only the deepest sympathy for the hapless Minister required by the obduracy and incompetence of her predecessors in this House and the other place to have to make such a Statement at the 59th minute of the 11th hour before a humiliating defeat in this place. Despite this Statement, I intend to carry on and move the Motion on the Order Paper so that the House will have an opportunity to discuss this issue at greater length than this debate allows.

Is the Minister aware that while the Statement claims to have delivered clarity, it has, in fact, merely thickened the cloud of confusion, incompetence and chaos surrounding home information packs and energy performance certificates? The House will have the greatest sympathy for the Minister, sent into bat by others with a text that even the kindest would regard with scorn and derision. It is no fault of hers and the House well understands that, but will she accept that this must be one of the most shameful episodes in public administration ever to come before this Parliament? Not only the Secretary of State but the Permanent Secretary should reflect on this appalling performance.

The Minister, because she is an honourable Minister, must be blushing at the Government’s created shambles over this whole issue. Will she inform noble Lords why Her Majesty's Government have pressed ahead with a scheme which everybody who knows anything about the housing market was telling them was not workable? Indeed, the Government have been told in this and the other House for years that it was not workable.

Further to the questions asked in Question Time today by my noble friend Lady Gardner, will the Minister inform us when sufficient assessors will be trained and accredited to carry out the energy performance certificates? Does the Minister recall that the previous shambles of the home condition reports having to be abandoned was also because there was an inadequate number of inspectors available to carry them out? For how long has the department been aware that there were insufficient numbers and for how long has it declined to inform the House and the public properly of this matter? It has been asked the question repeatedly and promises and assertions were always made that plenty were in training, but that is now a hollow statement.

The Government have announced that they are going to delay the introduction of home information packs until 1 August. That is eight weeks away. Will the Minister say when the new regulations will be laid, when we will have sight of the result of the pilots which have taken place and whether they are aware that the Royal Institution of Chartered Surveyors is still pursuing the judicial review?

We must all be grateful for the serious and considered judgment handed down by Justice Collins today. But why, when the Government had 10 years to get this right, has it taken the intervention of a High Court judge to finally bring a stop, if only temporarily, to what has been an unbelievable mess?

Justice Collins’s intervention will, I hope, protect home buyers and the house market for the time being. Why did the Government not pay more attention to the crucial report of this House’s Merits of Statutory Instruments Committee, which demonstrated that the policy was not fit for implementation? While the present stay has come about as a result of the Royal Institution of Chartered Surveyors seeking judicial review, the Minister must be aware of the extreme hostility there has been to the introduction of these packs from both consumers and the housing industry.

The Government’s only defence for the emasculated home information packs has been the inclusion of the energy performance certificate. Housing information packs without either the home condition report or the energy performance certificate are now nothing more than an empty packet. Tackling climate change and helping first-time buyers have been relegated to the afterthoughts in this entire process. It is clear that today’s delaying tactics are nothing more than a botched attempt to minimise the Government’s embarrassment over yet another U-turn.

Whatever the spin, we all know the truth. The housing information pack saga has been a model of how not to do government. HIPs are unnecessary, ill designed to address the problem they claimed to address, badly planned, badly timed, badly executed and, incredibly, not even ready for implementation after three years of legislation and more years of planning. Can there ever have been such a fiasco from the department? Home information packs as now conceived were a tax on home owners which offered no help to home buyers and would have frozen the market just when it needed liberating.

Would it not now be better just to bury this whole issue quietly and to bury it deep? Will the Minister accept that this House has been right all along on this matter? Noble Lords were right in 2004 when they rejected the idea by a majority of 47, but the Deputy Prime Minister insisted on reimposing it. This House was right in resisting the original regulations. The outstanding report produced by the noble Lord, Lord Filkin, who is in his place, and the Merits Committee was right and they deserve congratulations.

Is this climbdown not a major vindication for this House and its right to vote against regulations, and a major humiliation for the Government? Will the Minister confirm that in future the Government will conform with recommendations of the Merits Committee, and do so with less foot-dragging and much better grace? Will she take back the message from this House that this ill conceived plan should never again see the light of day?

My Lords, one can but sympathise with the Minister who is having to defend the indefensible. Last week the Royal Institution of Chartered Surveyors launched a judicial review. It was an unprecedented move, which it did not take lightly. It took it in the end in desperation because it simply could not get anyone in government to listen to it. Today, Sir Andrew Collins has agreed that there is an arguable case and that the RICS could not have moved any sooner than it did. Because we cannot have a hearing before 1 June, the stop-gap was to go ahead with home information packs without the energy performance certificates. It really begs the question what on Earth would be left inside the HIP. Householders would be left paying to hand over an empty folder. The solution now is to postpone the whole thing for two months. That means that we shall have another set of hastily scribbled regulations, which will have to come to this House in the next six weeks if there is to be any parliamentary scrutiny of them at all before the recess. It is simply not good enough.

The Government started looking at changes to house purchase 10 years ago. Seven years ago they brought forward legislation which introduced the home information packs. The practical objections from all sides of the industry, particularly the Law Society, led these Benches to oppose the measure. The Government ignored the advice they received and ploughed on anyway. It took them two years to bring forward regulations and, at the last minute, under pressure from an industry that knew that it could not deliver what it was being asked to deliver, they removed the home condition survey—the most important part of the pack. Since then, there has been a whole year in which the Government have continued to ignore the advice that they have been given, until they have been forced to make this ignominious U-turn today. They have finally admitted that they do not have sufficient energy assessors—after months of questions from noble Lords in this House and after months of assuring us that there were enough. Why has it taken a judicial review finally to reach the truth of this matter?

In her Statement, the Minister said that this will bring clarity. It is difficult to see how. We are going to start with four-bedroom houses. For the next two months, people will be converting bedrooms into studies at a rate of knots. My noble friend Lord Shutt wants to know whether the room that contains his model railway will be classed as a bedroom if he puts his house on the market. I am afraid that I am unable to tell him. We will have to wait to see whether the regulations include a model railway clause.

We are now told that social housing is to be included at the point of stock transfer and will apply regardless of where the stock transfer is taking place and how many houses are involved. Stock transfers involving many hundreds of homes could take place in areas where there are no surveyors—but we do not know, because that has not been thought about.

How much faith can we, the industry, or the public have in a solution that has, by the Government’s own admission, been cobbled together over the past few days? Individuals out there have paid to become accredited home condition surveyors. When the surveys were pulled, they had wasted their money. They then paid to become accredited energy performance surveyors, but now the future of those is in doubt, too. We must retain some form of energy performance certificates, because EU legislation demands them and, in any event, the climate change agenda demands that we take steps to reduce domestic energy emissions. Where will the assessors come from now that they have had their fingers badly burned by the Government’s mishandling of this matter?

Another measure that we are told will be taken is first-day marketing. In other words, you can put your house on the market without having a pack in place. We proposed that measure when the Bill was going through and we were given all sorts of reasons by the Government why it would not work. Four years later, we suddenly find that that is the answer. If this matter was not so serious, it would be laughable and it brings a new meaning to the expression, “Whitehall farce”.

The most important asset owned by anyone is their home. Whatever the shortcomings of the previous system, at least the uncertainties were well understood and could, to an extent, be planned for. As a result of the Government’s bungling, the system is in tatters. Neither the industry nor households have any idea what is coming next. It takes a staggering degree of incompetence to end up with no policy and every single interest group opposed to you—but the Government have managed it.

My Lords, I suppose that I should be grateful for sympathy, but I have no problem in defending the Government’s policy, which is certainly not in tatters. We have spelt out exactly where we are going and the reaction this afternoon highlights some of our problems in trying to keep the confidence of the market in assessors, which has been very much at the forefront of our minds as we have made our decisions in recent days.

First, perhaps I may clarify the specific point on where we are in the judicial review process. Judicial review has been stayed. We welcome, and I am sure that the House will welcome, our discussions with the RICS. We do not expect the claim to continue and we look forward to moving forward with the RICS. Let me also restate that we remain convinced that, for a market that has seen no change since my mother and father bought their house 25 or 30 years ago, it is right to try to reform and improve a system that is the slowest, the least transparent, the least predictable, the most costly and the most stressful in Europe. The information that we are receiving from our area trials of HIPS is that 70 per cent of sellers actually agree with us that HIPS are useful.

Some of the criticisms should be held for a little while. We remain committed to the principle of home improvement packs and we remain equally committed not just to the principle but to the necessity of energy performance certificates. Every week, we have a new report about the speed of climate change. Every week, we are told that unless we act now it will be too late. By bringing forward the energy performance certificates, we have tried to set a lead and an example in Europe.

Both noble Baronesses said that we had not listened; they said that we had rushed ahead and refused to listen to common sense, including to what this House and the Merits Committee said. In fact, we have listened extremely hard for the past two years. When the Council of Mortgage Lenders told us that it was not ready to implement the home condition report, we withdrew it as a mandatory element of the pack. We have looked at the evidence from our area trials, which we set up last autumn; I explained to the House at the time that we were doing that to get more evidence. We have made transitional arrangements for when, for example, leaseholds and legal searches will be presented. We have listened hard to what the stakeholders have told us about the problems that they have encountered. That is why the consultation exercise that we are putting in place will address the specific issue that the RICS raised about the EPC, so that we can determine at what age we can generate a performance certificate that is proportionate, effective and in the best interests of the consumer and the community. So we have listened.

I was asked how we will know that we have enough trained assessors. Earlier, I gave figures that I think are extremely healthy and very sound. We have 2,500 people in training—those who are still to do their exams. We have 3,200 people who have passed their exams. As I said, 1,500 people are accredited or in the pipeline for accreditation. These are people who have made a commitment for a new career. We keep faith with them, which is why the process that I outlined is about keeping up their confidence in a climate that has been extremely difficult and harassing for them, because of the responses of some of the stakeholders and the constant commentary in some of the press. Our intention is to ensure that they have the work that they want. That is why we are introducing this in a phased manner, starting with the larger houses on 1 August, because we know that we can guarantee that work for them.

We will look to the social housing sector, not least because that is the right thing to do. We will have detailed negotiations with the RSLs and local authorities. We will be pragmatic and practical at this point. We will use the evidence that is coming forward from the numbers of assessors that we have and the work that they are getting to plan properly across the autumn how we bring other properties online.

I was asked about four-bedroom houses. I do not have anything in my brief about model railways, but I have a strong sense that trading standards officers and the people involved will have a good idea about what a four-bedroom house is. I think that the point is a bit of a red herring.

I was asked when the regulations will be laid. I cannot give a date now, but I assure the House that there will be ample opportunity for full parliamentary scrutiny. Indeed, I am happy that we are having the debate later this afternoon, as that will be a good opportunity for the House to explore some of the aspects that we do not have time for with this Statement.

I was also asked when we will be able to retrieve information from the pilots. We have already had two tranches, which have informed the changes that we have made, and we will get more information in July and August. Because transactions in this country take a minimum of six months, we will not have the full information until early autumn. We will certainly take the evidence into account.

Let me address some of the other questions that I was asked. We made an initial response to the Merits Committee by putting additional information in the Library of the House and by writing to the chair. One of the committee’s specific criticisms of the Government concerned the age of the EPC. We are addressing that and will address it in the consultation that we will bring forward. I have dealt with the issue of stock transfer.

In conclusion, as the Secretary of State said earlier today, our intention is to maximise the benefits and to proceed with the people with whom we need to keep faith by being as open, frank and pragmatic as possible. We need to minimise the risks but maximise the benefits to the consumer both in the way that houses are bought and sold and also by cutting carbon and costs for the consumer.

My Lords, do the Government have a definition of a bedroom which would stand up in law? Has the Minister not seen advertisements in estate agents’ windows for houses with two/three bedrooms or three/four bedrooms? The Government must have a legally binding and watertight definition; otherwise this situation will be more of a shambles than it looks now. Further, can the noble Baroness say who in government should take the credit for what she clearly feels has been an administrative coup?

My Lords, there is no definition of a four-bedroomed house in any housing law that I am aware of, but I should have thought that we could bring a fair degree of common sense to bear in the matter. We know that four-bedroomed houses represent 18 per cent of the stock, which is why we have specified that size of home at this point. We shall certainly issue guidance to trading standards officers, who will have responsibility in this area, and we shall certainly listen to stakeholders, who I am sure would want to ensure that we got things right. With regard to who takes credit, there is collective responsibility, as the noble Lord knows.

My Lords, does the noble Baroness agree that this situation is so charged with human misery, waste and frustration and is so serious that it should not be the subject of party bickering or of trite political points? Furthermore, does she accept that for 10 years the Government have shown remarkable consistency in this matter? They made it a commitment before the 1997 election; in 2000, a Bill was introduced, which ran out of time; and it was the subject of Section 163 of the Housing Act 2004.

However, does the Minister accept that, whereas the Government can improve the situation for the community at large in only a limited area—there is no magic wand that can change the basic problem of the gap between the agreement and the ultimate exchange of contracts—what really counts in relation to HIPs is the home condition survey? If that is not made compulsory, there is very little prospect that the scheme will succeed. If it is made compulsory, there has to be a credible inspectorate that wins its spurs in executing its duties. But, if the survey is not made compulsory and it is left on a voluntary basis, the scheme will be a ship without a bottom.

My Lords, I am grateful to the noble Lord, who is absolutely right. We made a commitment in the 1997 manifesto to try to improve the home-buying process. I suspect that from his professional experience the noble Lord knows more than most how many millions of pounds are lost each year in failed transactions and how many times people have to arrange yet another survey because a house is withdrawn from the market. The insecurity, lack of information and lack of transparency makes the process a misery. When I answered questions in this House a week ago, a noble Lord on the Cross Benches pointed out that the system was much better in France. He was absolutely right, and that applies to many other European countries as well.

We withdrew the home condition survey as a mandatory element of the pack because mortgage lenders told us that they felt that valuations would still be necessary. It seemed to us that we had to test that assertion, and that is what we have been doing in the area trials. However, the information coming back to us is that people like home condition reports. They give them information when they first look at a house so that they do not get nasty surprises. It is extremely important that they should have that information. But we are where we are, and I shall no doubt be reporting to the House in due course on how the trials are affecting transactions.

My Lords, sympathy has been expressed to the Minister; she is entitled to have it, given the history of this matter. I hope that she and her ministerial colleagues will persist in ultimately producing a scheme that is acceptable to all parties. I remind the House that it was Peter Walker in 1984 who began outlining a scheme whereby the kind of thing that the Government are now introducing should be part of every mortgage. Over the years, successive House of Commons Select Committees have asked for this sort of thing, and I cannot understand how people, especially those from another place with constituency experience, do not understand the importance of its introduction and the misery caused by the present hiatus.

The Minister spoke in general about waste, but I have seen figures proving that £1 million a day is wasted under the present system. Will she confirm whether that is the case? Surely any scheme that ultimately helps to eradicate such waste is useful. Will she confirm, too, that despite remarks from the opposition Benches that this scheme has no friends, bodies such as the Council for the Protection of Rural England, Friends of the Earth, the World Wildlife Fund and others are its friends and should be encouraged? Those really interested in this matter can prove their interest in about half an hour’s time by staying behind to hear the debate that the noble Baroness, Lady Hanham, has said we will persist with. I cannot see the purpose of that, but I assure the House that the best speech that has never been made will be heard during that debate.

My Lords, that is surely an irresistible invitation to all noble Lords to stay and take part in the next stage of this debate. I am delighted to know that the Conservatives were so creative and committed in 1984 to bringing forward similar ideas, but I wonder what happened from 1984 to 1992.

I can confirm that £1 million a day is wasted in failed transactions; that is a well worked figure. Secondly, I confirm that the scheme has friends, certainly in this House, I am delighted to say, and in environmental groups which see the huge benefit of confronting as fast as we can the waste that we subscribe to by not being serious about saving carbon and not knowing how our houses use heat and how we can save on costs and energy. My noble friend is right on both counts, and I look forward to what I think will be a splendid speech shortly.

My Lords, the Minister talked about being open and frank. With a view to achieving that, can she tell the House when the Government will publish the results of the pilots and studies that have been running? They must not merely take those results on board but share them with the rest of the House, stakeholders and the public generally. When will the Government publish a full response to the report of the Merits of Statutory Instruments Committee, which dealt not only with home information packs but with the energy performance of buildings regulations? I guess that it will be delayed in a similar manner, although I am not sure that I have heard that. The Minister will be aware that many noble Lords on this side are keen to see energy performance certificates introduced in an effective manner that is acceptable to the public.

My Lords, we will certainly publish the results of the pilots at the end of the research cycle. Because of the length of transactions—we must look at the impact of home condition reports on them—that will be in the autumn. We put two full documents in the Library in response to the Merits Committee, including the RIA in which the costs and benefits were worked out. I will see what else we can do in response to that.

My Lords, why are the Government talking about four-bedroom houses if they want to be forward looking? We have heard from the noble Baroness, Lady Scott, and my noble friend Lord Tebbit that this definition is not firm at all. The Minister has replied that she is sure that the Government can look at something firm. Everyone who now buys a property does so according to square footage. The district valuer works on both square footage and square metreage of a property. Surely that is the clear-cut definition of how to determine the size of a property, rather than saying how many bedrooms it has. I reinforce the points of the noble Baroness, Lady Scott, and my noble friend Lord Tebbit.

My Lords, I am listening closely to what noble Lords are saying about this. There will be a chance to look at the revised regulations when they are introduced. I will provide the House with as much information as possible before then.

My Lords, what will happen if people who own properties with fewer than four bedrooms—three, three and a half, or whatever it is in square metres—believe it is in their interest to produce HIPs with energy performance certificates after 1 August but before the end of the year when the full scheme comes into operation? Many of them, possibly first-time buyers, may think that it is a selling point. They will save an average of four buyers commissioning surveys, environmental reports, searches and everything else in the intervening period. This would be on a voluntary basis, but would the Minister consider including that in the new regulations?

My Lords, I will certainly take away what the noble Lord says. On the fascinating subject of the four-bedroom house, I argue that there would be a financial disincentive to market a property on the basis that it has fewer bedrooms than it has. I cannot see the logic of noble Lords’ concerns about that. We will certainly ensure that we have the number of assessors needed to bring smaller properties with fewer bedrooms on to the market as we proceed.

My Lords, does the Minister take heart from the fact that, in a debate on home improvement packs in another place, both opposition parties gave a great deal of support to EPCs? I hope that we would not now bury this valuable aspect of the report, which is supported by all sides of the House. I find it distressing that they are not being brought in as quickly as possible. Those of us worried about climate change realise that some of the most wasteful properties are old ones that must be improved and insulated. EPCs are one way that that could happen. Although there has been a great deal of disquiet and justifiable anxiety about how this process has been brought to this point, I hope that the Government will implement EPCs at the earliest opportunity. They have the support of all parties, as I am sure will be confirmed by all those speaking. It is therefore unfortunate that, by the Government’s figures, if we are to save 1 million tonnes of carbon a year, we will probably lose about 250,000 tonnes of carbon dioxide into the atmosphere during this delay.

My Lords, the noble Lord makes an important new point about the unfortunate but inevitable implications of delay. He is absolutely right: we are not going to renege on EPCs. They are an extremely important part of our national policy for carbon reduction and of what people can do for themselves in cutting energy and bills. We will continue to consult closely with the environmental groups to ensure that we do this in the best way. We must now look at some of the issues raised by stakeholders during the consultation.

My Lords, I declare an interest as a surveyor and a member of the Royal Institution of Chartered Surveyors. I congratulate the Government on alienating the institution—the one body that was behind them throughout the legislation—which tells me that it cannot have any reasonable dialogue with the Government and has not been given answers to lots of questions. It is not surprising that it took the Government to judicial review.

The Minister is aware that I am included in her statistics about those training to be assessors, but she is not aware that I have refused to get fully qualified because of the waste of money that the Government have put me and hundreds of other people to. We spent a lot of money getting qualified for a new career that the Government have now taken away from us. A lot of surveyors who were on the course that I was on have decided not to become assessors for EPCs by themselves because it is not a sensible thing for a surveyor to undertake, particularly in a small practice.

The Minister said that the kits are useful; nobody is denying that. However, the market has taken care of improvements to the buying and selling process without central dictatorship from government. Lawyers have instituted better conveyancing—there is now e-conveyancing—and surveyors are getting more information upfront. The Government do not need to tell us to do that; everybody wants to do it.

The introduction of four-bedroom houses will give us surveyors such fun. We are going to have really good details from now on. My noble friend Lady Gardner of Parkes mentioned houses being sold by square footage. That might be the case in central London but not so much in the country. We are going to have real joy with three, four, five and six-bedroom houses. The poor trading standards officers, who are pushed for time now as there are not enough of them in local government, will come scurrying round. It is a mess. Please, just drop it.

My Lords, I hope the noble Earl completes the accreditation course, as the process is obviously going to be so much fun. I imagine that he will find it a better possibility.

As I said in the Statement, we are pleased that we have arrived at an accommodation with RICS. That takes us forward. The noble Earl said that he is not going to complete his accreditation course. We think that one of the reasons why people were slow to finalise their accreditation after they passed their exams, probably after they had done their five practical EPCs, was that they were uncertain what was going to happen. That uncertainty was wound up in different ways, not least by some of the newspapers, and we are sure that removing it will help. That is the only explanation we have for why so many people in training were being so slow to pay their final fees.

The noble Earl’s second argument was that the market will do its own job and regulate itself. We have not seen evidence of that, and the noble Lord, Lord Elystan-Morgan, made that point. However, where HIPs have been introduced—on a voluntary basis or in the trial areas—there has already been a shift in the market that is driving up competition. Local authorities could charge variable fees for searches, but 25 local authorities have already lowered their fees. We are not relying simply on HIPs to improve the process. We think they will provide a platform for the market to improve its own processes through introducing competition—noble Lords opposite are surely in favour of that. That will make a difference to the way things are done, which has not changed for at least a generation.

My Lords, cannot the EPC be disassociated from the sales process and, like an MoT certificate, be valid for 10 years, as suggested in the European directive?

My Lords, we do not believe that is the right thing to do. EPCs and HIPs together make up a coherent and effective package. If they were split, both would be weaker. We have a delivery mechanism with HIPs to develop the EPCs. Because they are inter-related, the regulations reflect that interdependence.

My Lords, I think it is our turn. Will the Minister give us any further information about large-scale voluntary transfer? I declare an interest in Berwick borough council. We are half way through LSVT. She will know that I support measures to try to reduce emissions from housing; that is important. I am also aware of the very difficult process councils go through with LSVT. It would be much appreciated if the Minister could give concrete information as early as possible about how the provisions will affect that process. Can she indicate when she will be able to do that?

My Lords, I cannot, I am afraid. It is something that we need to get absolutely right. We need to have discussions with individual RSLs to know what is possible at what pace and with what implications. It would be wrong of us to try to collapse that process in any way. I am afraid that it will take time, but I will try to keep the noble Baroness fully informed about our progress.

Home Information Pack Regulations 2007

rose to move, That this House calls on Her Majesty’s Government to revoke the Home Information Pack Regulations 2007 (SI 2007/992), to take account of the report on the regulations by the Merits of Statutory Instruments Committee and not to lay further regulations concerning home information packs until after full consideration by the Government and Parliament of the pilot schemes and of the representations of stakeholders and consumers.

The noble Baroness said: My Lords, we seamlessly move on in this debate. Noble Lords will share with me an overwhelming sense of déjà vu as we debate again these infamous home information packs. I tabled this Motion in response to the Government’s intention to introduce the Home Information Pack Regulations from 1 June. They have rightly now changed their position—all in the blink of an eye. Still, the Government intend to reintroduce these regulations despite extensive and authoritative objection to them from all sections of the housing industry, strong opposition in another place and the highly critical assessment from the Merits of Statutory Instruments Committee in its 18th report. Its thorough investigation and informative findings were backed up by evidence from professionals from all aspects of the housing industry.

Feeling among professionals and consumers on these regulations is unanimous: they are unnecessary and cannot work. The Motion today reflects that view. It tells the Government to take the regulations away and to think long and hard again. This has been a fiasco from start to finish. I remind noble Lords that the original intention was that each home information pack should contain a home condition report. Those had to be abandoned last year when it became apparent that there was no confidence that they could be relied on. Mortgage companies were not happy that they would contain sufficient information on which they could base mortgage offers. Potential buyers did not feel that they would provide sufficient information about the condition of the property. And, in any event, there were insufficient trained home inspectors to undertake the work involved.

Therefore, the proposals were jettisoned in favour of some “dry runs”—pilots to you and me—reports of which have still not been made available. I am glad to hear from the Minister today that we are likely to see some results in July, although some seem to be being delayed until August, which is after the new start date of these new regulations.

Not to be put off, the Government then turned the tables and decided that the main ingredient of a home information pack would not be a home condition survey but an energy efficiency report, which—as Yvette Cooper, the Minister in another place, said—one would give to a property rather as one would to a fridge. This would take pride of place in the pack. Domestic energy assessors had to be recruited and trained to perform this tick-box exercise. To date, although some have been trained, few, as the Minister has already told us, have been accredited or cleared by the Criminal Records Bureau, so they are not in a position to do the assessments, which must be done before a property can be put on the market. In short, there are simply not enough assessors to cover even a small proportion of the properties that will require an energy report from, we understand, 1 August. The Minister accepted that in the Statement today. Yet the department did not see fit to inform the House or the public until the last possible moment.

I am bemused by the fact that the Government delayed these regulations without waiting for the pilot schemes to conclude or having enough assessors in place, and for no other reason than a last-minute panic attack as a result of poorly thought-through policy brought on by poorly planned administration. The Minister told us in a reply to a question earlier this afternoon that there are 2,000 trained inspectors and 3,500 inspectors in training, but that only 500 inspectors are actually accredited. The Royal Institution of Chartered Surveyors was so concerned about the lack of consultation on the home information packs that it initiated the judicial review proceedings against the Government, which have brought this whole thing to a grinding halt. The stark truth is that the Government have made a complete mess of this, because they did not, and still do not, have sufficient inspectors to carry out the assessments. In any event, they have gold-plated the EU directives by making them a condition for the sale of a house, rather than as part of a 10-yearly inspection. Despite endless questions from this House, it is now apparent that the energy performance certificates were not in a state fit for implementation.

Like the Royal Institution of Chartered Surveyors, we are not against energy performance certificates per se. Indeed, we see room for them in a properly thought-through standalone energy policy, but not as one of the few elements of a home information pack. Those elements are indeed few, as the Government, as well as throwing out the mandatory home condition report, made it clear earlier this year that local authority searches and leasehold information would not now need to be included in the home information pack at the outset. My party has offered over and again to work with the Government, if they so wish, to produce a serious and effective energy policy for fairer and more effective use of energy performance certificates in accordance with the EU directive.

Perhaps I should remind noble Lords of the real effect of home information packs, even without the energy performance certificate. Buying a house will not be quicker; it will be slower. Slow progress in preparation and the exclusion of the home condition report have seen to that. Home information packs will amount to reams of red tape with no return. The regulations are a poor imitation of where this all started. Despite what the Government hope, valuations and surveys will still be needed, and there is no guarantee that home information packs will provide adequate searches, if they provide searches at all. Indeed, two-thirds of lawyers have said that they would advise clients to supplement home information packs with their own legal documentation. There are many and intricate criticisms to be levied against the regulations, but we have come to a point where the analysis is unquestionable.

Responses from the industry are staggering. The Law Society has said that home information packs will,

“make the process more difficult, much more expensive and remove existing transparency from the market place”.

The Royal Institution of Chartered Surveyors has called the Government’s approach to these regulations “cavalier”. In particular, it envisages,

“a detrimental effect on first-time buyers”—

one of the reasons given for the home information packs was to help those people—

“from rising prices, shortage of supply and abortive costs”.

The National Association of Estate Agents told the Merits Committee that home information packs are now purely an administrative burden to the home buying and selling process. The Better Regulation Commission considers that the use of energy performance certificates in the home information packs is gold-plating the EU directive, which will require energy ratings for properties for sale and rent by 2010.

I am baffled that unanimous opposition from the industry and the strictures of the Merits Committee have apparently fallen on deaf ears about the value of this whole process. I urge the Government to take the proper course of action, to take account of the 18th report of the Merits of Statutory Instruments Committee, to wait for the completion of the pilot schemes and the reports from them and, most importantly, to give full and adequate consideration to the representations of all the people who gave evidence to the Merits Committee who were so wholeheartedly against this whole process.

The Government have no defence for these measures now and will have no defence for them in August. It is irrefutable that they will freeze the housing market at a time when it needs liberation. Whether these regulations are delayed or not, this miserable pack will contain only an energy performance certificate, if you can get one; the title deeds of the property, which the owner should have anyway; a sales statement; and the pack index. All that will cost several hundred pounds of the seller’s money, which will almost inevitably be added to the cost of the property, so it will be the buyer’s money. And all for what? Valuations and surveys will still be needed. There is no guarantee that home information packs will provide timely or adequate searches. Two-thirds of lawyers have said that they would advise clients to supplement home information packs with their own legal documentation, which will be another expense.

It is my sincere hope that the Minister will accept the reasonable tones of this Motion and will, once and for all, bury the plans for a proposal that is hurtling towards failure. All along this House has been right about home information packs—when it voted against them in 2004, when it warned over the regulations last year and when, in the brilliant report from the noble Lord, Lord Filkin, the Merits Committee shredded the idea. Is it not high time that the Government listened to this House, to those in the other place and to those in the housing professions? Would they not be far better served if they did? I beg to move.

Moved, That this House calls on Her Majesty’s Government to revoke the Home Information Pack Regulations 2007 (SI 2007/992), to take account of the report on the regulations by the Merits of Statutory Instruments Committee and not to lay further regulations concerning home information packs until after full consideration by the Government and Parliament of the pilot schemes and of the representations of stakeholders and consumers.—(Baroness Hanham.)

My Lords, I had hoped to speak before the noble Baroness sat down, but since I am on my feet I shall say two things. I have been looking hard at the terms of the noble Baroness’s Motion on the Order Paper. I also heard the Statement read by my noble friend Lady Andrews. As I understand it, the regulations have been withdrawn. The Government have said that they will reintroduce them to take effect from 1 August. As of this moment, the regulations have ceased to be. They are no more. They have gone. They are not technically in front of the House. In those circumstances, how on earth can the noble Baroness move to revoke regulations which have already gone?

If ever there was a case when the self-regulatory mechanisms of this House may not be appropriate, this is it. Anyone who has been in the other place will know that faced with this procedural situation, there would have been a ruling from the Speaker of the House of Commons that the Motion was out of order. I make the point; I cannot enforce the point; there is no way that one could. But for the life of me, for now to spend two hours or whatever it will be on a Motion to revoke regulations that have ceased to exist is, it seems, even for this House, a waste of time.

My Lords, I have some sympathy with the noble Lord who has just spoken. However, here we are and since the only alternative is to take my bat and go home, I prefer to participate in the debate. In fact, there is some merit in doing so because the Government now have an opportunity to pause for breath, take stock, and perhaps think again.

We all agree that house purchase is fraught with difficulties. The main problems are and always have been gazumping, the length of time taken on searches, difficulties in getting a mortgage and, finally, surveys. With the removal of the home condition report from the home information pack, not one of those problems will be solved by the pack. A whole raft of groups has expressed concern about the packs. The Royal Institution of Chartered Surveyors was originally in favour, but now regards the pack as poorly conceived and has launched a judicial review. Estate agents, as one might expect, are not in favour, but neither are the Council of Mortgage Lenders, the Law Society or the Better Regulation Commission. Most telling of all, Which?, the Consumers Association, withdrew its support once home condition reports were made voluntary. It regards home information packs as currently constituted as,

“of little value but great expense to consumers”.

Finally, the body representing trading standards organisations is also against the pack, saying it does not believe that the proposed £200 penalty is any kind of incentive to comply. Trading standards officers are now supposed to rush around checking whether a three-bedroom house really has three bedrooms or four.

A lot of apocalyptic statements have been made by all sides in recent weeks. Personally, I have never bought into the idea that the whole market would come to a grinding halt if the packs were brought in, but enough serious concerns were raised that the Government should have listened to professional bodies sooner and taken action. Last week the Minister in another place rather dismissed the comments and kept referring to “vested interests”. It fascinates me that when people agree with the Government they are stakeholders, but the moment they disagree they become vested interests.

It would have been possible for the Government to refute a lot of the arguments being brought forward if they had published the results of the pilot schemes. However, we have had to take all that on trust. It is interesting to note that on the one hand the Minister has said that it is too early to publish the results of the pilots, but on the other hand that the Government have listened to what has come out of the pilots and have made changes. The civil servant who gave evidence to the Merits Committee confirmed that the pilot studies should have started last July but could not get going until October because the regulations were not in place. In fact, most of the schemes started in January and therefore it is too early to evaluate their impact. He went on to say that he did not know whether savings in transaction times had been made or how the public had responded. When asked about the cost, he replied that it could be anything from nothing to several hundred pounds. He was asked about home condition reports, and said he thought it was right that they should be voluntary but admitted that a voluntary scheme would be unlikely to result in a high take-up. I am not shooting Mr McDonald—he is just the messenger—but what he said was that there is no evidence of transaction times being cut, no clear idea of the cost to consumers, and no confidence that voluntary home condition reports would be taken up.

I want to turn to energy performance certificates, which are the subject of a different statutory instrument, but have become inextricably linked because the Government put that certificate into the home information pack. Both practically and in terms of debate it would have been much easier if the Government had not linked the two. We hear a lot of talk about the need to reform house purchase procedures, and then people talk about energy performance certificates which are a response to the climate change agenda and have nothing to do with the way we buy our houses. Members on these Benches have always been in favour of energy efficiency measures and we have argued for them for many years, but we have to be sure that however energy performance certificates are delivered, it is done properly if they are to be an effective way of helping householders properly to assess the energy efficiency of their homes and to determine how best to spend their precious money on energy efficiency measures. My fear is that if this is not done properly the whole domestic greening agenda could be brought into disrepute by measures that are not properly thought out.

The guidance was not published until 29 March and there was a very short time for the industry to prepare for what should have been a 1 June start. Over recent months there has been question after question about the number of assessors until, finally, there has been an admission today that only a few hundred have gone through the complete process.

I have a question for the Minister. Defra used to have an approval of energy assessors until recently as part of its grant-giving scheme. I am told that about 8,000 people were assessed and approved under the Defra scheme. The Government decided that they were not going to allow a “top up” scheme so that assessors who were accredited under the Defra scheme could take a short course and then move on to the EPC framework. However, in April they finally relented and organised a fast-tracking scheme. Why did the Government leave it so late to move people who were already accredited in the principles of energy performance into this new scheme?

The Minister said that there will be a roll-out of energy performance certificates—whether over the forthcoming months or years we do not know—and as new surveyors come on stream the categories of property which will have to have EPCs will be revealed. But it is asking for a huge leap of faith on the part of people training to be assessors to say to them, “If you train, we will give you the work”. You are asking these people to spend more money to be trained when the evidence they have had in recent months is that government promises cannot be relied upon.

There is an inconsistency in the Government’s approach to EPCs. The rented sector, which is around 11 per cent of properties, was not supposed to need these certificates until October next year. As a result of today’s Statement, we now think that certainly some socially rented properties will be brought in, but only after stock transfer. Representatives of the buy-to-let sector have told me that landlords have been told that they will need to renew the certificate only every 10 years. So the EPC regulations will state that a new tenant has to have a certificate, but that that certificate could potentially be up to 10 years out of date.

In another place, when asked about the 10-year period for people buying houses, the Minister said:

“it is a fat lot of use to a new home buyer to have information … that could be up to eight or nine years old”.—[Official Report, Commons, 16/5/07; col. 646.]

Why are the Government saying that it is a fat lot of use to someone buying a home to have a certificate of that age but that it is fine for someone renting a property?

If the Government are serious about domestic energy saving, it is high time that they reduced VAT on the materials to do so. That is the kind of measure that would show a real commitment to energy saving, rather than forcing people through a bureaucratic measure.

Home information packs should be scrapped. There is no evidence that time or money will be saved or that any of the problems associated with house buying will be reduced. Energy performance certificates should go ahead—indeed, they have to under European Union legislation—but separately from home information packs.

The Merits of Statutory Instruments Committee has done a great service in highlighting the problems associated with home information packs and how far short they fall of achieving the Government’s intended aim. The Government should listen to the committee and professional bodies and scrap them. There is no reason why the public should take all the risk for a bungled government scheme.

My Lords, I have to confess that part of me believes this is a fitting farewell to Mr Prescott. He started this policy and it ends in a farce. Perhaps some Ministers who have been involved with the policy—I exclude the noble Baroness the Minister—are not fit for purpose. The Civil Service is fit for purpose but perhaps its bosses were not.

The noble Baroness asked me to consider completing my training and obtaining my EPC qualification. The reason I am not going to do that is quite simple: it is because I identified early on in my training course that the home condition survey, in which one had three boxes to tick and there were many get-out clauses, was generally a waste of a survey; it was not a proper survey.

The EPC, on the other hand, is a very detailed survey, involving the number of windows, external walls, doors, boilers and radiators. Those are just the sorts of thing it is easy to get wrong. The boiler is the most important component when you heat your house, and if I get it wrong—if, out of the boxes marked A to E showing the energy value of the house, I tick the box marked B—and someone comes along and says, “That’s exactly what I wanted, a ‘B’ house”, and buys it, then sells it two years later and the next surveyor says, “Actually, it’s an ‘E’ house”, that is exactly when the surveyor gets sued. That is the risk, which is unacceptable when you are a surveyor in a small firm and you are not doing the rest of the work that goes with it. At my age I am not going to join a big firm that would have the insurance cover and the necessary protection. The threat of getting sued is the reason why a lot of estate agents have sold out to banks.

It is a difficult situation for our surveyors. I have done the training. I have half the energy qualification; I just need to update that, but I will not. I am not going to take that unacceptable risk. Perhaps that is why on the Government’s website there is only one qualified EPC surveyor for the whole of London. It is not really surprising that with only one surveyor they have had to pull the regulations. Until that situation has resolved itself—and some court cases are bound to come up—the Government will always have a problem on their hands.

The noble Baroness, Lady Scott of Needham Market, mentioned the £200 fine if one did not comply with the regulations. The Trading Standards Office does not have time to check the number of properties sold around the country and whether they are three, four or five-bedroom. There is a wide variety of ways you can describe a house when it comes to the fourth or fifth bedroom. I have seen some estate agents’ particulars for London in which they class as a bedroom a room that is no more than a walk-in cupboard. That will certainly be taken off the list in future, but they will still get the same price for the house because when they show the applicant around they will say, “This could be used as a bedroom”. I ask the Minister to look at that again, as it will not give clarity. It certainly will not help us surveyors. We will err on the side of not putting the number of bedrooms; that’s it—we are free. I can draw a plan and give the square footage, but I am not going to say how many bedrooms there are in a house any more, if there is any doubt. That is the way the market will react to something that has not been thought through terribly well.

What is the way forward? How can we help the Government? I agree with the noble Baroness, Lady Scott of Needham Market: let us separate the EPC from HIPs. The EPC is a regulation imposed on us by Brussels. It will not be the be-all and end-all of ending climate change. It tells you the value of the house, but it is actually up to the owner or the tenant to make the necessary alterations; put in the new boiler, change the radiators or put in more lagging. Again, the noble Baroness was right when she said we should get rid of the VAT on those improvements. That would get the confidence of the public, who would say, “This is not a diktat from central government”—which it is at the moment—“but something we can buy into. I will feel good from having extra lagging, and I will be able to get it cheaper than I can now because there will be no VAT”.

HIPs are dead. They are not adding anything to the buying or selling process. The market has moved forward, as have the solicitors and the estate agents. A lot of what the Government set out to do 10 years ago has happened and will continue to happen. More and more people are selling through the internet rather than going through agents. It is a constantly changing situation.

The time everything takes is coming down, which everybody wants. There is no benefit to a surveyor or an agent in not having quick transfers of houses, although there might be to solicitors, who can build up a big file and charge the client more money. The sooner one can sell or buy a house for somebody and get the deal done, the quicker one can go on to the next one.

This is a very difficult situation for the Government to get out of. We all want this market to work. I live and work in it pretty well every day of my life and what is happening is making matters more and more difficult and confused. I should like the Minister to take one message away from the House—to keep the EPC and do it separately; it does not have to be tied in with HIPs. Then we can look at the buying and selling process again.

I urge the Government to work with us surveyors. I know for a fact that communication with the National Association of Estate Agents and the Royal Institution of Chartered Surveyors was pathetic. The situation was bound to end in tears; it has done. Now that we have reached this stage, please can the department and the Government listen to what the agents are saying? I know that they do not agree with us, but we live and work in the market and we need that market to work for our own benefit as well as that of the Government.

My Lords, I reiterate the remarks of the noble Lord, Lord Richard. There is a bizarre element to the situation in that we are seeking to pray against an instrument that no longer exists.

My Lords, unfortunately, the noble Lord, Lord Richard, is not in his place, but we have had advice from the Clerks that the regulations will not be withdrawn until tomorrow. Therefore, it is quite appropriate to have this debate today because the regulations have not yet been withdrawn.

My Lords, I did not say that the debate was invalid; I said that it was bizarre. In the light of the noble Lord’s comments, it is more bizarre still.

Don Quixote tilted at windmills; he had a physical target to aim at, but for us the target will disappear tomorrow and there will be nothing for us to tilt against. Given that the Government are about to withdraw the regulations, can we stand back from the immediate question of the home information packs and look at the broader problem? It is of long standing and arises from the fact that, under our statute law, there is inevitably a gap between the moment there is an agreement subject to contract and the moment there is an exchange of contracts.

That gap arises out of statute law. It started with the Statute of Frauds 1677 in the aftermath of the civil war, when claims regarding hundreds and thousands of transactions might or might not have been valid. The 1677 Act ordained that there should be some evidence in writing to confirm a sale and purchase of land. That was the situation in the Law of Property Act 1925 and it was strengthened by the Law of Property (Miscellaneous Provisions) Act 1989. The Law Commission report of that year said that it was not sufficient that there should be some note or memorandum in writing evidencing a sale but that the contract itself should be in writing.

During that period of uncertainty, when the transaction is in a state of limbo, all sorts of abuses are possible, gazumping being the very worst of them. The noble Earl suggested that solicitors might have been working for their own purpose in delaying these matters. Lawyers have had to face that charge of delay for many centuries. The Roman poet Ovid said in the first century that delays in law are odious—every Member of the House will know exactly how it reads in Latin, so there is no need for me to reiterate it. I do not believe that lawyers are responsible for that delay. During that period, a great deal has to be done as far as the purchasing party is concerned. Normally, a third party is involved; that is, a lender. The lender, be it a building society or a private lender, will often be concerned not only with the physical state of the property but with the valuation. In addition, the building society, as well as the private mortgagee, may want to know a great deal as to the state of the purchaser’s finances. All of that is bound to take time.

Probably the worst indictment that can be brought against the Government, who have played fair in this matter and have been sincere and consistent for 10 years, is that they have overestimated the significance and status of the home information pack. They have done so for the reasons that I have mentioned. It is only one of a number of factors that affect this situation. Whether or not one has a perfect system of home information packs—this is far from perfect—one will always face the basic problem, which will exist unless we change our statute law.

Some people will say, “Look at Scotland”. There, by giving formal replies to a number of missives, one arrives at a concluded and binding contract. I shudder from seeking to make any evaluation of the state of the law north of the Tweed. France has a totally different system. While the system that we have is under statute, and I doubt whether we can change it without bringing about greater anguish, these problems will remain and the possible advantages of the home information pack will at best be limited.

The home condition report being a non-mandatory part of the home information pack is a massive weakness. The Merits Committee states at paragraph 18 of its report on the regulations:

“The Law Society expressed their view that the decision to remove the mandatory HCR had undermined the whole concept of the HIP; that it was inappropriate to link EPCs to HIPs; and that HIPs, ‘will, in fact, make the process more difficult, much more expensive and remove existing transparency from the market place’”.

I am not sure that that is absolutely correct, but the main thrust and the main potential benefit of the home information pack are lost unless there is a mandatory provision in relation to the home survey. That may simply not be possible at the present time. It could succeed only if there was an adequately manned inspectorate, made up of people who had not only examination qualifications but also experience. That experience will be invaluable with regard to the status of the home information pack in the market.

Therefore, I shall ignominiously abstain if the matter is brought to a Division. The Government have thought well about this matter, have been sincere and have been concerned with a real problem that affects so many people. About 25 per cent of all transactions fall in the three to six months that it takes for the deal to be concluded. The wastage in money is of the order of £300 billion to £400 billion per annum. That is a real social and economic problem.

I do not believe that it would be right for me to vote against the Government and certainly I cannot vote for them in this situation. Therefore, I am left in that purgatorial situation of abstaining.

My Lords, the noble Baroness, Lady Hanham, concluded her remarks by inviting the Minister to bury the current proposals, but I am looking forward to a resurrection. Although the Government may not even yet have got it right, I congratulate them on being driven by a number of imperatives.

I begin by saying what I would have said if this had been a standalone debate. I am puzzled, frankly, by the number of individuals and bodies agreeing in general that something should be done but not that which is proposed, or saying that it should be done quickly but not as quickly as is being proposed. I have a funny suspicion that a great many organisations mentioned this afternoon profess that they are in favour, in general, of action along the lines proposed, but are very conscious of the fact that they are trade protection organisations. There are professions to be protected. One early element that has emerged in my reading of the situation, although I am not as competent as some professionals who have spoken here this afternoon, and the general tenor that I sense in this discussion, is that there is a resistance to people entering a field that has been hitherto an exclusive preserve of the profession and that those people are seen as Johnny-come-latelies who are perhaps not as fully qualified as members of the profession. It is with a faint dose of praise that they say to the Government that something must be done, but not by the Government. They are saying, “Leave it to us—we are in the position to make the situation better”.

The House needs to be reminded of one or two facts. The main basis on which we have come here today is that there has been a lack of consultation. Well, we have all been in consultation. If the Government listen carefully but decide not to change their attitude, it is said that the Government have steamrollered and ignored other views. On the other hand, if as they have done today and more than once during this process, the Government come back and say that perhaps they can improve things, people sneer. People laugh and grin at what they believe to be a great humiliation. I do not see what the Minister or her colleagues have done as humiliation; instead, they are determined to try to get it right. I hope that we can build on what the Minister said in the Statement. There seems to be an emergence of a working arrangement between the main protagonists and the Government. One might say, “That’s good news, but it is a bit late”.

When I was in the Commons some 25 years ago, there was a vogue for something called a logbook, which was to put right what has been attempted now. The idea was floated and a lot of flesh was put on the bones of the idea that every house should have a logbook, which was part and parcel of the sale. That was 25 years ago. I referred earlier to the advice that Peter Walker gave in 1984 that mortgage lenders should insist on information of the kind that we are talking about being part of every sale. Early Day Motions have been introduced in the Commons for action to be taken and Select Committees have come out in favour, in general.

I am not competent to argue the minutiae of the detail of the proposals, but I am looking in general at the situation with which we are faced. Frankly, it is an appalling situation. As regards the energy situation on the ground, I am told by Friends of the Earth that 2 million people are at risk from fuel poverty and that 1 million do not even have hot water insulation. That costs only £20. The cost is so little but the reality is that millions of homes in this country could be improved. Some of us have taken necessary steps such as having loft insulation installed. We incurred a cost but it was not tremendous. We may ask why on Earth other people do not take those steps when they have the same need to have a better insulated and more energy efficient house. The sad fact is that they do not. They can either be compelled to do it—of which I am not in favour—or encouraged to do it by sticks and carrots offered by the Government.

Eight million people lack cavity wall insulation and 6 million lack roof insulation. If that is the situation, you cannot really blame the Government for trying to put right that which is patently bad. A recent United Nations report on climate change identified energy efficiency measures as crucial to reduce CO2 emissions. Reference has been made to the fact that we are under a stricture because we have to comply with EU regulations by a certain date. I hope very much that the Minister will take away from this debate the fact that millions of people, whether they know it or not, will benefit from legislation of this kind. Many noble Lords opposite have not suggested proposals to deal with the basic problem, as opposed to being negative. Tinkering with the issue has been suggested, as have incentives, and perhaps other ways of doing it. I hope that the atmosphere which is generated around the table by the main players in this matter will lead to the laying of the order, which we are promised by 1 August. That is not a long time away; it is two months. These things take time, as I demonstrated. It has taken 25 years to reach the present position.

Reference was made to the support, the lack of support, or the unanimity of the opposition to these proposals. However, it is not necessarily so. I have a list entitled the Directory of Home Information Pack Providers. It is a long list, including conveyancing and legal services, companies, estate agents, surveyors, search companies, finance houses, technology and others. It is not an extensive list or even large. To say that there is unanimity among the professions is nonsense. This matter is being used as part of a general stick with which to beat the Government, not just on this but on other issues.

I sincerely hope that the Minister will keep in mind the burning ambition that she and I share that the homes in which people live should be made as comfortable and as energy efficient as possible. I refer also to the terrible waste that occurs—£1 million every day is wasted in transactions which subsequently fail. Although a majority of noble Lords will vote on party lines against what she is doing, I hope that the Minister will take heart from that fact that she can use the period won in the past day or two to re-engage with anyone willing to support proposals to deal with the basic problem—that people are entitled to a decent home. Noble Lords talk about the costs. Well, I have been told that the cost will be between £350 and £400 per energy efficiency report. Given that the average cost of a house is nearly £200,000, that would be money well spent.

I say to the Minister and her colleagues: you have listened carefully so far, you should listen further to me and to others. All power to your elbow.

My Lords, I do not wish to say much. I am sure that we will have another debate. I wish to make two points, particularly in response to the noble Lord, Lord Graham. He referred twice to the £1 million a day wasted on home transactions. We all agree with that. He and others do not seem to understand that home information packs will not save money but are likely to add yet another £1 million to the costs of selling homes.

We estimate that some 600,000 sales are aborted each year, and that will not be prevented by home information packs. If the packs cost around £600 a piece, that represents around an additional £390 million on the cost of selling houses, an extra £1 million a day. Anyone who claims that they will save £1 million a day is talking rubbish; that is why we are against them. Given the need for affordable homes, the extra £1 million a day is unacceptable.

As my noble friend Lady Hanham and the noble Baroness, Lady Scott, said, we are all for the energy element of this legislation, particularly as regards the European directive—the House is unanimous on that—but we are against home information packs. They are a total waste of time and we need something different if we are to help the people of this country.

My Lords, it is good to know that the noble Lord, Lord Hanningfield, agrees that £1 million a day is a reasonable estimate of the money wasted. The packs will cost money but they are to be produced on behalf of the seller. On average, every transaction involves three aborted attempts to purchase before there is a success—a 1:4 ratio. Whatever the costs—we could debate them for a long time—it would seem reasonable to suggest that there is £1 million a day of aborted work.

Part of the reason that the Royal Institution of Chartered Surveyors and other organisations have opposed these proposals so strongly is that they will probably lose that business of £1 million a day. The Government have opened up much of their work to competition, and professional bodies do not like competition. I am a member of the Institution of Civil Engineers, as is my noble friend Lord Howie. We value our professional qualifications and do not like competition, but we should have it, as should the RICS.

Noble Lords opposite say that everyone is against the proposal, but the only person who has spoken in this debate in favour of consumers—buyers and first-time sellers—is my noble friend Lord Graham. Those people, represented by my noble friend, should be listened to. Of course the professional organisations will say, “We are going to lose all of this money, it will be the end of the world and the quality will go down”, and so on, but there are many checks and balances. We should accept that the Government are trying to make this more accessible so that, when you buy a house, you do not have to commission four or five surveys for four or five different houses that you do not end up getting, in place of the one that should come with the home information pack.

I was struck by the amount of time and effort that we have spent in this debate complaining first that there are not enough inspectors and then that, when inspectors get their qualifications, there are not enough jobs for them. We cannot have it both ways. There are bound to be start-up problems, when there may be too many or too few inspectors, but I hope that my noble friend’s new timetable will sort that out. I wish this new timetable and the whole project very well.

My Lords, perhaps I could try to dispel some of the ill tempered comments about the professions. My interest is that I used to teach property law, so I hope that I have sufficient detachment to see the effect of property law on buying and selling. We could, perhaps even starting in this House, change the law, but there are complications that cannot be overcome, because in recent years property law has been seriously affected by informal family and third-party rights—the rights of divorced wives or other people living in the house. Your Lordships will well know how complicated landlord and tenant law is. Unless one abandons all humanity, British land law will remain very complicated, so house sales will also be complicated, as others have said.

I want to make a few short points. The first is that, given the difficulties that I have described, there is now no point in the HIP in itself, if we leave to one side the energy performance certificate. It is unfair to say that the professions are trying to hog the matter for themselves. Bearing in mind the announcement this afternoon, I feel that there is nothing as dangerous as a half-dead animal, which will hit back and sting before it is finally dead. In the next few months, the situation will be, especially for first-time buyers, even more costly, stressful, complicated and deceptive.

Secondly, the energy certificate must be a good thing; indeed, it is an obligation. However, it still needs careful attention. As a member of the Merits of Statutory Instruments Committee, I received a great deal of most useful information, out of which a few points arose. It is hoped that the energy performance certificate will lead to savings in energy costs, but the cost of the certificate, which may be a few hundred pounds, will not be recovered for something like nine years; the financial outlay that buyers and sellers will have to make now will not be recovered for a long time, by when there will no doubt be other energy considerations.

Another point is that, if the certificate is to be provided every time the house is sold, in many cases this will be too often—that is, less than 10 years. However, some people do not sell their family home for 20, 30 or 40 years, in which case there will be no energy inducement; there will be no need to get a certificate and no need to think about energy improvements. Tacking on the energy certificate to house sale does not make sense.

Finally, I was not reassured in studying the material before the committee that there will be sufficient checks on those who make the energy inspection. I did not think that the qualifications and security issues attaching to those people who enter the house were sufficiently taken into account. There seemed to be no assurance that the accuracy and helpfulness of the energy certificate would be properly checked. In other words, the certificate might not be worth the paper it was written on, even if all the training goes forward; there is not yet sufficient infrastructure for that.

I therefore simply want to add my voice to those who have said that the home information pack should be abandoned and that the energy performance certificate should be taken forward, but in a way that focuses solely on saving energy and has nothing to do with buying and selling houses, which in English law, going back as it does 1,000 years or more, is complicated, but complicated for good reasons.

My Lords, I rise to support the evergreen Minister in this Chelsea Flower Show week because I think that people have failed to understand that the Government really have tried. I want to refer to the debates that we had on this subject with the noble Lord, Lord Rooker. I spoke on that occasion too. He invited all of us to go to Committee Room 4, where he had the biggest bunch of officials that I have ever seen. They had been working on these issues for 10 years and were all good men and true. Then, suddenly, everything went wrong.

Frankly, we have a disaster on our hands today. There are 2,000 to 3,000 people with families who thought they were going to get jobs and genuinely set out to do something but are now regarded as a liability by the Minister, who said that we must do something with them. Why not? We also have a bunch of officials who have studied absolutely everything in this field. Therefore, there is an opportunity, and I congratulate the Minister on having done the right thing in a charming way, having announced that the Government are going to stop and think again. It is a case of going back to the drawing board.

I started my life in a drawing office, where, if you used too much Indian ink or spilt it on the tracing paper, you had to pay for a new sheet of paper. I was taught to work in cubic feet and metres but everyone else works in square feet and metres. Perhaps I am unusual in that. I should like to disclose, as I have already, my interests in this field. I was a director of a house-building company and also, for 20 years, a director of a company that manufactured baths, cookers, heaters, fridges and boilers—all the energy-consuming things. I had to worry about methane and learnt that the one thing to be concerned about was consumption and energy.

We sold baths in Germany and worked in a cast iron factory. The cast-iron baths were wonderful because they had high insulation, but it was the volume that counted—how much hot water went into the bath. I do not know whether the Minister knows the WETs concept of water and energy tests. It concerns water, waste water, energy and the environment, and is all tied in with the EU. If we bothered to think, we would say that these are important factors. The first issue concerns cubic feet or metres and the question is: what is the air volume of the house? It is not the number of beds that matters but the volume of air that has to be heated. What are the Btu or kilo-calorie values and how quickly does the heat transfer from one side of a wall to another, whether or not there is a cavity? One of the great advantages of flying freeholds is that other people are heating your house, and the idea now in terraced houses is to encourage the people around you not to insulate well so that you can steal their heat. Therefore, the volume of the air in a house is important rather than the number of bedrooms. If you are not careful, a four-bedroom house can take you into a higher tax band when you buy or sell.

The second question is: how many cubic feet or metres of water are consumed? Water is dispersed as waste water, carrying effluent with it, or it may have to be heated. So the questions are: what is the volume of the bath; how many people have showers; and what are the benefits? These issues will not go away, and the answer may be to go back to our earlier discussions.

When we debated the matter before, I suggested that we should agree a code of conduct or a code of practice on the information that should be provided by a willing seller to a willing buyer. We should have new WETs legislation to deal with all the factors. I do not want to correct noble Lords who said that things are better on the Continent but, at the moment, because there are rural areas throughout Europe, studies and tests have to be carried out on sewerage. People have to submit a return on the volume of water consumed, how environmentally friendly the system of disposal is, how the water can be reused or treated naturally and what worms must be present to digest the waste. Those issues will apply here as well.

With water shortages, we will have water consumption tests and, as consumption rises above a certain level, the charges will probably rise even further. We want to know the energy consumption of each house, and that information is readily available in gas and electricity bills, which show the number of British thermal units consumed. Again, the volume of water consumed is also important.

The insulation value is directly related to consumption of energy so you do not need all these people running around. But they are there, and maybe they could be used. Why do the Government not drop HIPs and move on to home improvement grants again? I exclude double glazing, which is not allowed in a listed building because of the light reflection on the windows outside. There are so many complications in our system that it would be better to make it simpler: get rid of the home information packs as they are now; agree a code of conduct with industry, which could be done rapidly because of the pressure that has been put on; and use the officials and those who have been employed to look at introducing and implementing new legislation relating to energy consumption, water consumption, waste disposal, sewerage and, of course, the disposal and reutilisation of home rubbish.

There is an opportunity for the Minister to take initiative. I would love to help her, It would be a waste of time to do nothing and complete folly to try to introduce HIPs.

My Lords, I should declare an interest as a solicitor, but I should say that I have no interest here in protecting my profession; my interest is in protecting the consumer. Reference has been made to so-called vested interests. Some interests may be vested but it is not appropriate to categorise all those who started out as stakeholders, as my noble friend said, as vested interests who are somehow on the wrong side. Certainly the view of the RICS changed from one of supporting the introduction of home information packs to opposing them because of the difficulties of which we are all aware.

I cannot help but smile wryly at the wrong expansion of the acronym, which has happened even today. Home information packs have been called home improvement packs—would that they were. A question that arises from my experience of observance at a distance of conveyances—I cannot tell one end of a Land Registry document from another—is that, in attempting to streamline the process, there has been, or has been thought likely to be, an increase in personal searches. In using modern technology and encouraging streamlining, does the Minister have any comment on how that might be addressed? Perhaps it is a rather boring point but it is quite important in the question of streamlining.

The Government acknowledged the importance of pilots, which I raised in a question following the Statement earlier. During the proceedings of the Housing Act 2004, we were at first told that it was not possible to pilot home information packs satisfactorily because the markets were not sufficiently localised. Then pilots were introduced, but—I have said this already today, but I will emphasise it—it is important that the results of those pilots are made public. When we debated HIPs last October, the Minister said that the Government,

“will look to see whether people genuinely feel better informed and more confident as a result of the pack”.—[Official Report, 11/10/06; col. 337.]

That is a very important statement, which I would extend from home information packs to energy performance certificates. We must not lose those or lose sight of ensuring that there is public confidence in energy performance certificates.

The Statement referred to day-one marketing, and we understand that until the end of the year this will be permitted. This matter was taken up by my noble friend Lady Maddock with some energy, and by the noble Earl, Lord Caithness—until recently, day-one marketing without a home information pack was not on; now it is on but for seven months only. What factors are changing? Why can day-one marketing without home information packs be accepted up until the end of the year, when that will be reversed?

Finally, on energy performance certificates, can the Minister—either today or, if it is too technical a question, following today’s debate but in a way we can all share, because it should be on the record—explain why it is not possible to proceed with energy performance certificates without home information packs? I suspect that it is technical and is to do with how the 2004 Act is framed. With the support expressed around the House for energy performance certificates, it is beginning to look more practical and less time consuming to go ahead with a bit of primary legislation to allow separate energy performance certificates, rather than have them caught up with HIPs which are now so controversial and lacking in support.

I confess to feeling personally almost let down; perhaps that is too strong. I started the debate on home information packs seeing a good deal of merit in the proposal. My confidence has ebbed as the years have gone on, and I am now sad that the Government have failed. Although we are to get new regulations, I see it as a failure. Eight weeks will certainly not put it right, nor allow us the scrutiny required after this sorry saga.

My Lords, I continue to support the Government’s intention to reform the process of buying and selling houses. Under the current arrangements, a buyer enters into an undertaking to buy a property without having crucial information on the property from either the seller or the estate agent, who is being paid a fee to sell the property. The buyer, not having been given this crucial information, must then spend money on searches and copies of the deeds to find out whether the undertaking to buy at an agreed price is sound or not.

Logic suggests that those selling the property ought to provide all the necessary relevant information about it to a prospective buyer, rather than leaving them to find out key pieces of information at their own expense. Then, if the information they find leads them to withdraw from the purchase, they have incurred expenditure they cannot recoup and are, of course, no nearer to having purchased a property. If they are part of a chain, their decision to withdraw can lead to other transactions falling through, with expenditure incurred by other buyers being wasted. The reality is that £1 million is lost in aborted costs every day.

Of course, buyers have also spent money they cannot recoup if the seller withdraws after the expenditure has been incurred on searches and copies of legal documents, but before contracts have been exchanged. The groups that do not lose out under the present arrangements are those doing the searches and obtaining the documents, because they get paid for what they do irrespective of whether the sale proceeds. Indeed, if the sale does not proceed, they potentially do better, because any subsequent potential buyer will have to go through the same process of having searches undertaken, again at their own expense.

The Government intend to transfer the cost of searches and obtaining required documents from the buyer to the seller. This means that obtaining required documents only has to be done once on a property, avoiding buyers having to pay such costs—possibly more than once—and more than one search being undertaken on the same property. It also ensures that the person selling the property has an obligation to provide the necessary information which a buyer needs about the property for them to make a decision on whether or not to enter into a contract of purchase. Since the majority of sellers are also buyers, so they would secure the benefits when purchasing. The group that would stand to benefit most, since they are not sellers at the same time, would be first-time buyers when arrangements can be extended to them.

The information required in the home information packs which does not currently have to be obtained is, of course, the energy performance certificate. It is designed to improve energy efficiency through providing information about a property on the issue. What evidence there is suggests that the most likely time for energy efficiency improvements to be made is when a property changes hands. Energy performance certificates give homes an energy rating and, since more than 25 per cent of our carbon emissions come from our homes, addressing this point is relevant in acting against the threat of climate change. Information about energy efficiency measures that have or have not been carried out in a property, what the fuel bills are, how they can be reduced and how carbon emissions can be cut will encourage people to make energy efficiency improvements.

We should be aware of the declared goals of one of the organisations opposing the proposals. I was somewhat surprised to read a letter from the chief executive of the National Association of Estate Agents in one of the appendices to the report from the Merits of Statutory Instruments Committee. It stated:

“We have consistently stated that the Government’s, and our, desire to improve the Home Buying and Selling Process will not be improved by the introduction of HIPs. As we have mentioned to the Minister, more than once, if HIPs were really going to achieve this—

that is presumably a reference to the improving of the home buying and selling process—

“thus reducing our members’ costs and increase their profits, members would have been 100% in favour of them”.

It is good to know the goals that drive the National Association of Estate Agents on this issue. They appear to have little to do with securing a better deal for its customers, although one has to say that there is evidence that by no means all estate agents share the view of the national association.

I hope that the Government will pursue their plans and will make sure that in future all originally anticipated requirements are a part of the home information packs or whatever may take their place and that home condition reports will be a mandatory part of the package before too long.

My Lords, I speak as chairman of the Local Government Association. I am grateful for the reversal of the implementation, but it still leaves us with great uncertainty—in many ways, more uncertainty than we had before. There is uncertainty for home buyers, home owners, professional organisations and my own particular interest, local government trading standards staff.

Local government trading standards staff have been heavily involved in the preparation for this. They have been training for it and are involved the regulation, its enforcement and the wider issue of public awareness. Trading standards officers have an immensely professional body called LACORS. It normally deals with any legislation in a responsible and professional way and often simply cautiously welcomes whatever the Government say. However, I shall remind the House of the evidence that LACORS gave to the Select Committee of your Lordships’ House. Its professional officer wrote:

“LACORS does not perceive how HIPs will make the home-buying process easier and more transparent”.

Indeed, LACORS also felt that the enforcement provisions are problematic and that HIPs would not be effective in delivering the Government’s policy for making property transactions cheaper or more transparent.

For our staff, it is a bit like being in the grand old Duke of York’s army. They have been marched up the hill of home conditions reports; they have been marched up the hill toward 1 June; and they have now been given a new hill of four-bedroomed homes, which my noble friend Lord Caithness spoke about so well. We need absolute certainty. In local government, we do not even have certainty about the funding issues. The preparation of this proposal has cost a great deal of money and time.

The Minister will remember some months ago that some £2.2 million was supposed to have been identified for local government. At Christmas we asked where it was and we were told that it had been included in the annual base increase awarded the year before. Our local government staff seem unable to find it, so I think we need some clarity on the issue. I should like confirmation that this extra cost will not put any burden on to council tax payers.

The original objectives were to try to have a process which added to transparency and was simpler. We have heard a lot of talk about climate change today. The original objectives of home condition reports, which objectives at least were understandable, have moved to objectives which are less clear. If this issue is simply about energy, I have a lot of sympathy with the noble Baroness, Lady Deech. She asked whether this is actually the best way to improve energy efficiency. I am one of those people who has lived in my house for 40 years. I do not intend to move. Are we saying that these home condition reports are only for when you move? Therefore, we really do need a rethink on this. Above all, I ask for clarity in the process and in the timetable, and certainty for local government staff and trading standards staff, who have worked very hard on this matter and who have been let down by a process that has not been well managed.

My Lords, I am sure that the quality and scope of the debate has reinforced the sense of the noble Baroness, Lady Hanham, that it was important to have a full debate on the issue. The contributions from around the Floor have been very generous, wide-ranging and thoughtful. From my point of view, although the word “surreal” was used, this felt only too real. I will think very hard about what has been said. I want briefly to describe some of the opportunities for listening again to the very important arguments that have been raised.

The Government have been sincere in what they have attempted to do. I say that to the noble Lord, Lord Selsdon. We have tried very hard throughout this process to be careful and open. I hope that in the debate noble Lords have seen that the Government have met many of the points raised in the Motion—for example, in terms of the consultation we are promising, the fact that we are revoking the regulations, and that we are listening to stakeholders. I hope that on that basis alone the noble Baroness will not press this to a vote.

Let me clearly put the position on revocation. The regulations have not yet been revoked. We expect that to be done as soon as possible. We have a duty first to consult the National Assembly for Wales, which we have not yet had an opportunity to do. As soon as all those processes are complete we will revoke the regulations.

I give particular thanks to noble Lords who have not only supported the policy—and they have not been entirely my noble friends but some noble Lords from other parts of the House—but given a clear exposition of why we felt it was very important in the first place to bring forward HIPs and then EPCs, and to tie them together. I pay particular tribute to my noble friend Lord Graham for taking us through some of the history of this attempt to wrestle with a hugely complex problem. The noble Baroness, Lady Deech, illustrated that. Buying and selling our homes, and property law, is very complex. It is very personal, and it affects us all very deeply, which is why we have to be so careful. The noble Lord, Lord Elystan-Morgan, took us through some of the contextual problems that we face when we begin to wrestle with these things. I suspect that that is what has made previous Governments back off and remove themselves from the fray. We decided that we would try to address those problems, for the reasons that I hope I made clear in my Statement.

I shall not repeat everything that I have said. Indeed, that would be unnecessary, because many of the things that I said will stand. I have listened to the expertise of Members around the House this evening, particularly in our debate on the nature of stakeholders’ engagement. It is particularly important to say to my noble friend Lord Graham that this is an opportunity to re-engage with stakeholders to ensure that, in the space that we have created around consultation, we address the realities of what we hope to achieve now by bringing forward transitional arrangements in the way in which I have described. That includes the trading standards officers, who will play such an important role. I am sure that a lot will depend on their ability but, again, phasing in this scheme will give them scope for a smooth and measured introduction.

Let me begin properly by saying that the changes that we have announced today certainly do not mean that we have lost faith in the principle of the necessity of HIPs or, indeed, in the relationship between HIPs and EPCs. Many noble Lords have spoken very powerfully about the importance of EPCs and the whole energy issue that they imply. We believe that the two things go together; HIPs provide a vehicle for EPCs, and EPCs give greater substance to HIPs. We fully intend to introduce HIPs and EPCs together and in a way that will generally benefit the consumer, the community and the country, so that they can obtain maximum benefits.

I was very glad that the noble Baroness, Lady Scott, referred to the fact that she had not been impressed by the apocalyptic statements about the impact on the market. That was worth saying, because one has had the sense as the debate has unfolded that the market will somehow be overturned because we have imposed a HIP on the process of buying and selling. The chief economist at the Halifax said in the Guardian very recently:

“Looking at the longer-term, we don’t think they”—

HIPs—

“are really going to have much of an impact at all … Yes, it is an additional cost, but in the grand scheme of things, people need to move house because they need to move house ... It's not going to stop people moving”.

That is utterly sensible.

My noble friend Lord Graham—indeed, I picked this up from other Members around the House as well—talked about the way in which people seem to welcome change but at the same time think, “Make me good, oh Lord, but not just yet”, because we do not actually want to commit ourselves to specific changes. We believe that there needs to be more transparency and predictability in the way in which houses are bought and sold so that costs and wastage are cut. Some sort of revolution is needed in the way in which we use and pay for energy in the home. It is not practical or acceptable to separate the two.

We believe, on the evidence that we have, that HIPs will make the process of buying a house swifter, simpler and surer, for the reasons that many noble Lords have given. Having information up front removes uncertainty, and being able to count on legal searches so that one is not adrift in some process over which one has no control and which requires endless phone calls to check up on progress will surely reduce waste and inefficiency. We do not believe that it is inevitable—it is certainly unacceptable—for one in four transactions to fail, or that £1 million is wasted in searches and legal costs. The additional cost, as I have said, is £100 for EPCs, which is even lower than my noble friend Lord Graham suggested.

It is unacceptable that consumers do not know how to make informed choices about whom to purchase services from, or that many buyers do not know exactly what they are paying for or how much their searches cost. We have no incentives in the system to improve that process, so it is fraught with information failure, lack of transparency and absence of control, and requires people to work together at the same speed in transactions. It is a chaotic system. As I hear myself describing it, I can hear how chaotic it is.

The noble Baroness, Lady Deech, raised a point about first-time buyers. They will benefit and will not have to pay for the things that they pay for now, which is bound to be an improvement. People entering the market for the first time will have the guaranteed security of information that they need in their hands for free. It was partly for those reasons that we responded as we did to the first comments of the Merits Committee. In response to the noble Earl, Lord Caithness, as I said in response to the Statement, there are many ways in which this sits alongside other changes in the market. The sort of change that is making a difference, which we think HIPs will help, is e-conveyancing, which is certainly making a major impact. HIPs are a part of that revolution. I also disagree with the noble Earl about the speed of transaction. Independent evidence suggests that the process between different stages of the transactions is 10 days slower than it was 10 years ago. I have already said that new providers are entering the market and cutting costs. HIPs are being offered free in some places and local authorities are reducing their search fees. All that is part of the argument that we are making for HIPs.

On EPCs, we are entirely of the view that home owners must have up-to-date information if they are to make their homes more energy efficient. The noble Baroness, Lady Hanham, asked about first-day marketing and what had changed. We have moved on to this for the transitional period to ensure that home assessors have work to do. Putting this work at the beginning will give some security and space to achieve that, which, again, is about keeping faith with the assessors and getting people used to the system as it unfolds. For that reason, we propose that every time a home is bought and sold it will require an EPC, and I have listened to what noble Lords have said about that. That will give the new owner the information needed to make their homes greener, to cut carbon emissions and to cut their bills. In response to a Question today, I gave the figure of £300 in savings.

Let us now turn briefly to the situation we face. I shall try to answer some of the other questions raised by noble Lords. I shall reiterate why we introduced the changes that we did. The Royal Institution of Chartered Surveyors requested a JR because it believed that the Government had not consulted sufficiently on the EPCs. The judge considering the application issued an interim order allowing HIPs to go ahead on 1 June provided that they did not include EPCs. The judge has also indicated that the matter could not be resolved before 1 June as he required more time to consider RICS’s application.

We were deeply concerned by this state of affairs for a couple of reasons. First, the delivery of EPCs is directly linked to the delivery of HIPs, of which EPCs are a central part. Secondly, there are now many people around the country—I have cited figures several times today—who have invested time and money in training to become energy assessors. I think that the noble Baroness, Lady Deech, raised quality assurance. I can assure her that the quality systems which have been put in place and accredited through the Qualifications and Curriculum Authority are extremely tough and rigorous. We continue to work very closely with the assessment centres to make sure that they are monitored properly, so we are convinced about quality.

I think that the noble Earl, Lord Caithness, described the process, which seemed to me to be very rigorous. However, the uncertainty that has been generated in a number of ways has had an impact on the numbers of fully accredited energy assessors. But the numbers who are now attending courses and who have passed their exams suggest that there are enough assessors in the system to meet the demand. We believe that continuing uncertainty would be detrimental to the market and to the implementation of the scheme. Noble Lords have called for clarity and certainty, and I respect what they are saying. I can give an assurance that we will work with stakeholders in every way we can to make the process as clear as possible.

To establish certainty and to ensure that energy assessors, home buyers and other stakeholders in the market know that we remain committed to the principle and convinced of the benefits of HIPs, and to prevent legal delays, we will be making transitional arrangements immediately. We will over the next few weeks revise the regulations we are revoking today. As I said earlier, the new date is to be 1 August when we will begin to implement the measures in phases. From that date, HIPs and EPCs will be required for the sale of homes with four or more bedrooms because we believe that there is enormous potential for larger properties to contribute towards energy efficiency. In response to the noble Baronesses, Lady Hanham, Lady Hamwee and Lady Scott, by taking a phased approach we can ensure that assessors who have already been trained and accredited can use their skills and that there will be sufficient numbers to meet demand.

Under the current regulations an EPC is required every time a property is bought and sold, but is valid for only three months. As a temporary measure we will amend the regulations so that a new EPC is required only if the certificate that exists is not under a year old. That means that the maximum age of an EPC when a property is marketed will be 12 months. In order to smooth the transition further, which answers the question put to me by the noble Baroness, Lady Hamwee, sellers will be allowed to market their home without a HIP provided that they have commissioned one. They will still be required to provide a HIP before the exchange of contracts, but the demand for assessors will be spread over a longer period when HIPs are first introduced and the demand is high.

In response to the point about rented housing made by the noble Baroness, Lady Scott, we have already said that we will introduce EPCs for rented housing in October 2008 but, as I said earlier, we will certainly now begin exploring the opportunity for implementing EPCs on a voluntary basis in social housing, at the time, for example, of stock transfer. Later this year we will assess the implementation of HIPs so that we can consider what further steps may be needed to reduce carbon emissions and drive forward the transformation of the home buying and selling market.

I shall answer a few of the specific questions put to me before I conclude. On the pilots and the evidence available, as I said, early results from the trials in terms of the practicalities of delivering HIPs informed the January consultation and the 2007 regulations. Full results reflecting completed transactions and the impact on time will be published when we have the large volume of HIPs we are expecting in the autumn as they become available. That will certainly illuminate the effect on transactions.

I turn to the questions put about the home condition report. We lost some friends for this policy when we withdrew the report, but we did so because we were so strongly advised by mortgage lenders that it was not practicable to go forward with it. We have balanced these issues as best we can in the interests of the consumer. I am sure that there is a consumer benefit, but we shall continue to listen to opinions because HCRs are now being tested in detail in the trial.

I am grateful for the wide-ranging comments of the noble Lord, Lord Selsdon, outlining his alternative scheme. I cannot promise that it will be given a great deal of serious thought, but I shall take it back to the department where officials will be interested to consider it.

In the light of the time and the fact that this is the third occasion on which I have had to explain the scheme, I close by saying that I shall read Hansard closely and make sure that noble Lords are given written replies to any remaining questions. In conclusion, I know that all who are seriously concerned about the way the market functions and about the need to cut carbon emissions cannot be satisfied with the current provisions. The Government have thought long and hard about how to reflect the best evidence in their approach. We have made the changes that we have announced today in the best possible spirit, taking with us, we hope, the major stakeholders and creating an opportunity for more consultation and re-engagement in the way I have suggested. We believe it is a pragmatic and sensible way forward which keeps faith with the policy and with the people who have kept faith with us by entering training and committing themselves. I hope that we have given as much certainty as we can and we will continue to do all we can to bring more and greater clarity.

We believe that we are minimising the risks to buyers and assessors while maximising the consumer and environmental benefits that will flow from the regulations. On that basis, I hope the noble Baroness will feel that she does not have to seek the opinion of the House and is satisfied with the debate. I am grateful to all noble Lords who have taken part.

My Lords, I, too, thank everyone who has taken part. It has been a long HIP day but the debate has been more than worth having. In the light of the Statement earlier, it was a balance as to whether to continue with it, but it gave us an opportunity to look at the process in greater depth.

I remain sceptical about the EPCs. It is a pity that the Government have withdrawn them for such a short period because they have not given themselves time to think through, first, the comments that have been made by other people and, secondly, to hear what the Commons now proposes to do. Clearly some of the announcements again are flawed. The Government may well want to rethink the proposal about a four-bedroom house when they come to work out the practicalities.

We will remain sceptical about this aspect and about the value of the home information packs. The Government have withdrawn the regulations—for today, anyway—but, as I made clear, they are not yet revoked. This is reason we were able to undertake the debate and, because the regulations are temporarily in suspension, I beg leave to withdraw the Motion.

Motion, by leave, withdrawn.

Georgia

rose to ask Her Majesty’s Government what is their assessment of the current situation in Georgia.

The noble Baroness said: My Lords, I have tabled this debate today in order to raise issues that have been thrust into the limelight by this weekend’s EU summit in Samara. I thank the three noble Lords and the Minister who will be contributing.

As distant and remote as Georgia may seem to be, there is growing realisation among individual European Union states that unilateral decisions are not necessarily the best way to resolve differences with states close to current EU borders. A hasty decision with one country, no matter how justified it appears to be, from a narrow perspective, can have unfortunate consequences on another country’s affairs. I hope the House will forgive me if my comments sometimes appear to go beyond the boundaries suggested by the debate, but it is only in the wider context that relationships within and without Georgia can be understood.

The unfortunate failure of Germany to secure its ambitious agreements with Russia this weekend is a clear reminder that the recent expansion of the EU has given us new responsibilities as well as new markets. We cannot choose to ignore tensions between the new members and Russia, or between Russia and other former Soviet states, whenever it is convenient for us to do so. Nor can we fall into the trap of viewing these tensions only through a Cold War perspective. Instead, I hope the Minister will be able to reassure us that we are taking all steps necessary to improve the current dichotomy of a Cold War energy infrastructure imposed on a 21st-century political reality. What steps are the Government taking to break dependence on Russian energy supplies—not only Georgian dependence, but also Europe’s as a whole? Recent events last winter show how vulnerable we all can be. Such insecurity must be harder for a state such as Georgia to respond to calmly and effectively. The Baku-Tbilisi-Ceyhan pipeline is certainly a step in the right direction but the proportion of oil provided from Russia is continuing to rise, and the recent expansion of Russian control over Kazakhstan and Turkmenistan’s gas and oil exports will not help.

In addition to growing uncertainty about its energy supply, Georgia continues to face internal instability in South Ossetia and Abkhazia. Where do Her Majesty’s Government stand on the request by Georgia to replace the Russian-led peacekeeping force with a multinational force? The Sochi agreement has been a success in preventing all-out warfare between the different factions, but it cannot be seen as a long-term solution. How do the Government hope to see further progress in that area, and what steps are being taken to prevent Russia meddling in Georgia’s attempts to find a way forward in South Ossetia? These steps are never going to be effective if EU countries continue to disregard each other’s concerns over policy approaches. What progress has been made on developing a unified and consistent EU approach to questions of self-determination?

The EU may not be the only international body that we should be working with to resolve Georgia’s difficulties. That country has frequently expressed how important it is for it to join Nato, and talks have been continuing. What stage has that dialogue reached, and what implications will eventual succession have for the already tense relationship with Russia?

It is most encouraging to see how Georgia has continued to make great progress in both the political and economic arenas. The rose revolution was a beacon of hope for Georgia and similar countries in the region. It showed the enormous desire for democratic prosperity and the political will to make it happen. Although some optimism may have faded slightly since the beginning of this decade, I do not believe it is entirely extinguished. We welcome DfID’s intention to focus UK aid more closely on good governance in future. Will the Minister reassure the House that she will make certain that the Government do not let Georgia down but will continue to support its efforts?

My Lords, we may be rather few in number as speakers, but I know we are all grateful to the noble Baroness, Lady Rawlings, for initiating this short debate. We put down our names because we have huge admiration for Georgia and its people.

I first had the privilege of visiting Georgia during the height of the Cold War, and I think all of us who visited it at that time were hugely impressed by the way the characteristic ingenuity and creativity of the Georgian people enabled them to survive rather better than some other satellite countries under the iron rule of communist dictatorship.

The second time I had the opportunity to visit was not long after Mr Shevardnadze had taken over, and we literally went to sleep at night in Tbilisi to the sound of gunfire. We can all be profoundly thankful that most of the country is now more stable and has some real democratic rule.

The third time I visited, about two or three years later, I was left with an extraordinary series of contrasts. There was clearly a huge amount of corruption which enabled the black economy to flourish so that some people could afford to pay £50 or £100 for tickets to hear the Moscow orchestra in Tbilisi, but people who were on fixed incomes, particularly pensioners, were literally starving. I am still haunted by the story of a university professor in Tbilisi who apparently starved to death because he simply could not get enough to eat on his basic salary. That, thank goodness, has begun to change. Some of us had the huge privilege a few weeks ago to listen to the new president of Georgia painting a very encouraging picture of what is happening there. He emphasised two points: first, he has got on top of the corruption; secondly, the country’s economic prosperity is at last beginning to show some kind of development.

I do not feel qualified to assess whether that is a true picture of what is happening in Georgia or whether it is over-optimistic. Can the Government give us their estimate of whether the terrible corruption which was once very much part of the scene in Georgia is truly being tackled and whether the economy really is developing as the president believes it is, or as he told us it is?

I would like to focus my remarks on three areas. The first is against the background of the huge warmth in Georgia for the British embassy in Tbilisi. On all my three visits, it has been quite clear that the president of Georgia has worked very closely with the ambassador in Tbilisi and there are very warm relationships with this country. Are the Government satisfied that DfID in particular is doing what is best for the Georgian people to help their development? I had an e-mail from a friend who expressed some disappointment about DfID’s change of direction. It would be good to know from the Minister what DfID is doing and whether she feels that that is enough or whether this country should be doing more.

Secondly, what are we doing with our European allies? Although there is now a democracy in Georgia as a result of the rose revolution and what took place before that, we are all aware that democracy is not simply built by having elections. It is necessary to have a range of flourishing institutions to safeguard human rights—an independent judiciary, a free press, freedom to worship, and so on. Although Georgia has a very long and honourable tradition of religious tolerance—Jews, Christians and Muslims have lived together in peace for well over a thousand years—it was not many years ago that certain renegade Orthodox priests inflicted violence on non-Orthodox communities, and the Government were extremely slow in tackling this. Democracy is not just a matter of elections but of building up institutions so that human rights, in all their aspects, are fully protected.

Thirdly, I reiterate what the noble Baroness, Lady Rawlings, said about the role of Russia in relation to Georgia. I have huge admiration, as I know do your Lordships, for the Russian people and a great sense of how they have suffered and survived over the years. However, in the vacuum provided by the demise of communism, the Russian people are finding a new identity through reverting to some of their earlier traditions such as the supremacy of the Orthodox Church in Russia and Russia being the big player in that region. As I think we are all aware, Russia is not just being a big player but is bullying some of the satellite countries—we think tonight particularly of Georgia. I therefore underline what the noble Baroness said and ask the Government to consider how we are working with our European allies in ensuring that the independence of Georgia is truly safeguarded, without being in any way a threat to Russia. We clearly need to be careful to ensure that Russia does not see our relationship with Georgia and its potential accession to NATO as a threat, but we nevertheless need to ensure that Georgia’s independence is fully safeguarded. We must not allow Russia to bully it in any way.

As the noble Baroness emphasised, Europe has a major responsibility to act in concert in relation to Georgia and the other countries. I am afraid that one of the main reasons for the terrible wars after the break-up of Yugoslavia was that Europe did not have a unified, agreed policy in relation to the countries which have since emerged—Croatia, Serbia and so on. I hope that the Government will be able to assure the House that we are working with our European allies to have total agreement in a policy towards Georgia and other countries that are in a similar situation.

I emphasise that Georgia, which is a great friend of this country, has a wonderful future. I hope that the Government, working by themselves and with their European allies, are doing all that they can to help it at a time when there is so much potential for good but also so much potential for danger, not least in its relationship with Russia.

My Lords, I am honoured to be part of a small group of friends of Georgia assembled in this House this evening. I am grateful to the noble Baroness, Lady Rawlings, for giving us this opportunity for debate. She may be surprised to see me here when we normally discuss development issues further afield. The reason is that, during a visit to the Caucasus back in the 1960s, I met a Georgian family who have remained close friends ever since. I have strong memories of a proud nation, which is now finally escaping from the Russian bear hug and attempting to join the European family of nations.

Not so long ago, as my noble friend said, it was quite different. I remember my friends, some of them in Paris, telling me of acute food shortages in Georgia. There was no meat in Tbilisi, for example, because no trader could afford the petrol to transport it. The country under the crumbling Soviet system seemed to be sliding into anarchy, and our own churches and charities were actively helping to provide food for the most destitute.

Now it seems that everything is changing under a gifted and popular Prime Minister who has pulled round the economy and attracted new investors. Perhaps he has been forced by the Russians and their embargo to seek alternatives. He is a graduate of Kiev University and two American law schools, and he immediately drew attention as Justice Minister when he initiated major reforms to the Georgian criminal justice system. In Parliament, he also tried to reform the very messy electoral system and has promised to tackle corruption, which however remains the scourge of good governance and the elixir of the powerful mafia, who are both Georgian and Russian.

The country is still volatile, with South Ossetia and Abkhazia asserting their independence and the region of Ajara on the Turkish border remaining semi-autonomous. Tension continues in South Ossetia in spite of Russian efforts towards dialogue, and I am told that there are 300,000 refugees from Abkhazia alone. The UN mission there since 1993, UNOMIG, has been extended until October. Since there is British participation there, I am sure that the Minister will confirm that that small force is keeping the peace but can do little more than that.

There was a time when Britain really mattered to Georgia. It was the British head of mission, the great Sir Harry Luke, who rescued the royal family and other emigrés from the Red Army in 1921. The story is still being told. I am glad that Britain is reviving a mature relationship with this ancient country, whose language long precedes our own. We now encourage Georgians to learn English, but the new president, among others, already speaks English and six other languages. The UK is becoming an important trading partner, with BP one of Georgia’s largest investors because of the new pipeline, which the noble Baroness mentioned. Georgia is rightly striving to look towards Europe—and I believe that it will be a test case of EU enlargement. The Minister will update us on the European neighbourhood policy action plan. If we cannot devise a form of Europe to which Georgia belongs, Europe is in my view not worth having.

Georgia has participated in international peacekeeping operations such as KFOR and ISAF in Afghanistan. Entering NATO is a major priority and Georgia has been admitted to the intensified dialogue that could lead from partnership to membership. That would certainly strengthen the stability and security of the country and might help to balance the enormous and continuing influence and interference of Russia in Georgian affairs. Would the Minister agree with Richard Holbrooke, the former US ambassador to the UN, that Russia successfully manages to keep Georgia off the UN agenda? Does she believe that NATO membership, defence apart, would also secure more democratic values in the country?

After what has happened in the Middle East, one sees a danger of hypocrisy in proclaiming western values too often in countries where we may be able to gain economic advantage, especially in the energy sector. But if the word “democracy” applies, we should mention again the signs of democratic reform. There is an active judiciary. The justice ministry has just filed a law suit against Moscow at the European Court of Human Rights over Russia's mass deportations of Georgians last autumn. More Georgians are travelling abroad; the service and tourism sectors are booming, and churches are coming back to life—and I hoped to hear more from my noble friend on that, because the churches are very important in Georgia. There is a revival in the arts and music teaching; there are computers in schools and the press is very active. The British Council must be commended for running a series of training events in investigative journalism throughout the country. Even closer to home, for many male Georgians at least, has come a new emphasis on women's rights, with the country’s first ever law on domestic violence, adopted last May by the Georgian Parliament, following extensive consultation with the NGOs. This has been welcomed by human rights agencies such as Amnesty.

These are encouraging signs—but on the negative side, the economy is still fragile and there is high unemployment in Tbilisi. Many feel that they have been left out of the privatisation process, which is monopolised by a new elite. One of my Georgian friends says that her concern is the continuing Soviet hangover, the “soft totalitarianism” which still pervades the state, with many senior positions in culture, sport, education and other sectors dominated by the ruling party. I understand that even the details of Georgia’s representative in the Eurovision Song Contest were directly handled by the Administration, down to her costume and hairstyle.

But there is a deeper concern. Half the population live in rural areas and many are below the poverty line. My friends in Paris tell me that roads outside the capital are in a very poor condition and that some children even lack shoes to go to school in, let alone school materials.

I know that DfID has a small programme in Georgia, which was mentioned by my noble friend, and that the embassy supports small projects. As the noble Baroness said in her opening remarks, much of our aid is directed at good governance and conflict resolution through such channels as the global opportunities fund. Are we also addressing poverty directly through microcredit or small enterprise schemes?

The IMF and World Bank have been pressing Georgia hard and there is now a poverty reduction programme in place so that millennium development goals can also become a focus of assistance. Does the Minister believe that the country is any nearer these goals, which affect the majority of the population?

Georgia still evokes a romantic image of the past, of mountains, vineyards and the writings of Lermontov. But under new leadership and with a bit of help, will it be able to free itself from its past and Russia and embrace the values which represent the true interests not of East or West but of the Georgian people?

My Lords, considerable knowledge of Georgia has been evinced by previous speakers. I add my thanks to the noble Baroness for initiating the debate. I think that I am the only speaker in this debate who has not been to the country; none the less, there is always that ancient principle that one can comment on countries even if one has not been there. I have studied Georgia in depth in recent years. As speakers would have mentioned if they had had more time, Georgia is a small country with a population of about 4 million. Some 1.5 million live in the capital—the usual concentration that you get in small countries in that stage of development. The capital acts as a magnet for people trying to find work.

Even before the fall of the Soviet empire, there were fierce clashes against Soviet rule well before the Second World War. The huge vote for independence in the 1991 referendum was very exciting and was followed by the reign of Eduard Shevardnadze until the rose revolution, which has already been mentioned. President Saakashvili’s Government are grappling with many problems, including the continuing tensions in relations with the Russian authorities and local nationalists and with irredentism and separatism.

Ajara has now been fully included with the demise of Abashidze but Abkhazia is an uneasy muddle despite the 1994 Moscow agreement. As other speakers said, the situation in Ossetia remains extremely unsatisfactory and worrying. But on the economic front things have been much more encouraging, despite the problems already mentioned. Rather like Moldova, Georgia had to find new export markets. It has started to do so and there are some encouraging signs. However, it has the continuing problem of energy supply security.

Georgia is actively pursuing a series of policies to develop its Euro-Atlantic links, even supporting the coalition forces in Iraq. We have now had nearly eight years of the PCA with the European Union, covering economic and trade relations, and a slowly developing range of social, scientific and cultural initiatives plus considerable EU donor support. As I believe the Minister will confirm, if she has time, the ENP is a formal part of Georgia’s links to the EU, and, as we know, the Government in Tbilisi are anxious for Georgia to become an EU member.

The action plan of November 2006, mentioned by several noble Lords, obliges Georgia to proceed with a number of important EU-oriented reforms. The amazing BTC pipeline, with BP as the project leader, opened a year ago and now transports some 10 per cent of the world’s tradable oil along the second longest pipeline in the world. The West as a whole and the EU are happy to see Georgia reduce its dependence on Russian energy sources and join in fully in the Transport Corridor Europe-Caucasus-Asia initiative for transport integration, to enhance the roles of Poti, Batumi and Supsa with the west route oil pipeline project.

During a press conference with Tony Blair on 25 April, the day of President Yeltsin’s funeral—an interesting coincidence—President Saakashvili referred proudly to the country’s economic successes in the past three years, reminding us that the World Bank praised the country in its recent reports, and that the UK had become the main investor among European and other countries. Perhaps the Minister would confirm that we are the chief supporter of Georgia’s future NATO membership.

There is no indication that the personal and psychological problems of the tricky relationship between the western-educated President of Georgia and the KGB-educated power-hungry President Putin will be solved in the future. It is a fact of life that we have to live with, and we should keep out a sharp eye for Putin’s relentless attempts to assume exclusive and excessive power in the Kremlin to the detriment of Russian democracy and Russian journalists.

The West’s support for Georgia is essential to ensure that this small country is not bullied into submission by the Russians, but has its own international framework of friends to help, to observe and to keep an eye, as the noble and right reverend Lord, Lord Harries, inferred. At the same time, the US has to keep on the right side of Russia in the wider geopolitical sense in this delicate Asian sub-region. Meanwhile the Government have rehabilitated the late President Gamsakhurdia, who wrested the country from the Russians’ grip in the early 1990s, and have also launched an action at the European Court of Human Rights, as has been mentioned. The deportation of hundreds of its citizens was a distressing spectacle and I am sure that the British Government are concerned about that and its aftermath.

Potential sparks are there all the time between the giant former superpower and the tiny, proud, nationalistic, sometimes bloody-minded, but always impressive country, Georgia, to the south-east. Opposition members have recently been put on trial in Tbilisi, accused of plotting coups against the Government because of their pro-western stance. Is Russia behind these activities or not? That is the question on everybody’s lips locally and overseas.

In a way, one can understand why Russia is very annoyed at the foolish Georgian decision to more than double its military contingent in Iraq. It would be better for Tbilisi to reduce its leaning towards the USA. The unending series of catastrophic blunders from the Government in Washington in everywhere from Israel to Palestine to Iraq to Iran is unmatched in recent decades of US history. That is painful to say, but that is certainly the case since the Vietnam debacle and the previous US humiliation with Iran. Is it wise for this vulnerable country, Georgia, to consider hosting part of a future US missile defence shield on its small territory?

The Georgian president recently denounced the election results in the irredentist Abkhazia, despite approval for them by the election commission. Only Russia supports this breakaway province and keeps troops there as peacekeepers. That is another difficult problem. Georgia is benefiting from its links with Azerbaijan, not only because of oil and gas supplies, once again led by BP, which helps the country to withstand the irritations of the Russian blockade and sanctions and the recent doubling of the price of natural gas. Moreover, the Russians know that Georgia has increased its links with Turkey to offset the negative effects of the Russian behaviour.

However, at least the Russians sent back their ambassador to this defiant little country and Putin has repeatedly alluded to returning to friendly links with Georgia. The jury is out on these complicated questions. Mr Putin still seems to resent the fact that Georgia was the first former Soviet state to break away after the collapse of the USSR. Naturally the Russians think that Georgian defiance will influence the Chechen rebels, but Russia has mishandled that matter—as badly as the Americans have mishandled Iraq—so disastrously from the beginning that no solution will be available short of at least a high degree of autonomy for that tragic and much-damaged country.

The situation in South Ossetia, with two regimes side by side—one pro-West and the other pro-Russian—is absurd, as we all know. We wonder whether the British Government have any useful suggestions to make about these complicated matters.

The complaints in Europe about Georgia’s often hot-headed antics vis-à-vis Russia should be heeded by the Saakashvili regime. To be fair to the president, he has often repeated that he does not wish to be an anti-Russian bastion or, indeed, a bastion for or against any geopolitical interests or areas. He wants equilibrium for this country, which is emerging from a difficult past into what we hope will be a bright future. However, he needs to create the impression of a more equilibrated posture to reconcile conflicting pressures in a more rational and less excitable way.

The Czech Prime Minister, in his mid-May visit to his Georgian counterpart Zurab Noghaideli, expressed strong support for the country’s future adhesion to both the EU and NATO. This needs to be achieved in a way that does not alienate the Russian authorities, with their echoes of old Cold War encirclement arguments against so-called US and allied plans to increase their quasi-military involvements and equipment in the area. Even with a strong rate of growth in the last few years, can Georgia really make sense out of the large increases to military spending budgets that it has made recently, as I have mentioned?

The overall picture remains complex, muddled and highly confusing. At the end of last month, the Russian foreign ministry spokesman Mikhail Kamynin warned against the stance taken in the capital to counter the two breakaway entities. Both Bagapsh and Kokoity warned at the same time that they would break off the talks with the Georgian Government aimed at reconciliation if the latter did not cease forthwith their attempts to legitimise the puppet Governments that they have installed in both provinces. This would also impede indirectly Georgia’s efforts to join the EU and NATO. In effect, Georgia cannot pursue these objectives, the Russians assert, until the breakaway situation in both territories is resolved by mutual agreement. Kamynin specifically described the approach to NATO as very rushed.

The recent UN Security Council resolutions on the matter have tried to be balanced between Russian interests and the West, as reflected in the composition of the “Group of Friends” component in UNSC membership. The UNOMIG mandate has been extended, and I add my request to the Minister for details of how the Government feel that that is going.

The overall atmosphere remains very tense. There is an apprehensive fear that some unforeseen incident could spark off an outbreak of some kind of military action. Kofi Annan must be glad that he has finished his term of office, but the UN needs to watch the situation closely. I hope that the Minister will have time to respond to some of these points.

My Lords, I congratulate the noble Baroness, Lady Rawlings, on securing this timely debate on Georgia so soon after the visit in April of President Saakashvili to the UK. I, too, regret the fact that there are not more noble Lords present this evening, as this has been an interesting and informative debate.

The invitation to the president was made to offer support and encouragement to Georgia for the path that it has chosen, so I trust that noble Lords will not be surprised or disappointed to hear me echo many of the positive statements that have been made in this debate. Like the noble Baroness, we recognise and celebrate Georgia’s strong desire for democratic prosperity.

Georgia has travelled a remarkable distance since the rose revolution that brought President Saakashvili to power in 2003. Then, Georgia was a country beset by internal strife and economic problems, as the noble and right reverend Lord, Lord Harries of Pentregarth, graphically illustrated. Despite formidable challenges, it has developed into an important regional actor and increasingly an international player. Georgia’s leadership can rightly be proud of her achievements so far, especially her strong economic growth and democratic reform. Economic growth was 9.4 per cent in 2006 and a staggering 13 per cent in the first quarter of this year. That is quite remarkable.

Serious efforts have been made to tackle corruption and crime, but these must continue. We are very conscious of the huge amount of work that Georgia has put into her reform efforts and we encourage her to continue along this path. It is vital that the Georgian Government ensure that reforms made in legislative terms are implemented properly and that their sustainability can be demonstrated.

The noble Baroness and other noble Lords rightly mentioned the conflict in South Ossetia. It is of the utmost importance that the internal conflicts over the separatist regions of Abkhazia and South Ossetia are resolved peacefully. This is crucial for the stability, security and long-term development of Georgia and the wider Caucasus region. The ongoing conflicts in these two regions hinder Georgia’s development to some extent and complicate its relations with its neighbours. We fully support the efforts of the UN and the OSCE to find lasting political settlements in Abkhazia and South Ossetia that respect Georgia’s territorial integrity within its internationally recognised borders. We urge patience and confidence-building dialogue with all parties. Long-lasting and sustainable solutions to these conflicts can be obtained only through peaceful negotiations between the sides. We also fully support UN efforts in working to remedy the deplorable situation with regard to internally displaced persons.

We attach great importance to this issue. On 1 October 2002, Sir Brian Fall was appointed as the UK’s special representative for Georgia—an appointment later expanded to cover the whole of the South Caucasus. Sir Brian is a senior UK representative on the Group of Friends of the UN Secretary-General, which aims to help the Georgians and Abkhaz to find a peaceful solution to the dispute. He regularly discusses the conflicts and other issues with senior members of the Georgian Government. We hope that the reforms that Georgia is currently undertaking will help it to move closer to resolving the conflicts. Stronger links with the outside world and greater prosperity will make Georgia the most attractive option for the would-be separatists.

The UK provides support to Georgia on conflict prevention programmes funded through the Global Conflict Prevention Pool. Our approach to civil-society building in Georgia has largely concentrated on encouraging dialogue across the various conflict divides and on developing the capacity of NGOs, journalists and other key groups to better address conflict-related issues. We consider the work of NGOs to be hugely important and commend their effective work across the conflict divide.

The noble Earl, Lord Sandwich, mentioned UNOMIG, the UN observer mission in Georgia. The UK is one of 28 nations contributing military personnel—we provide five. I will gladly write with further information about what we believe the mission is achieving at present.

Noble Lords will have gathered from my remarks so far that Georgia and the situation in and around Georgia are of interest and importance to the UK. This is exemplified by the high-level dialogue that we have with Georgia, most recently during the president’s visit last month. The UK stands ready to help Georgia in her desire to become a stable, prosperous, democratic and well governed state. We welcome Georgia’s aspirations to Euro-Atlantic values, and we support her sovereignty and territorial integrity, which we see as vital factors in maintaining stability in the whole region.

I am grateful for the warm support of the noble and right reverend Lord, Lord Harries of Pentregarth, for the work of our embassy in Tbilisi. He asked about DfID and other assistance. The Department for International Development has been providing support to the Georgian Government since 1992 and expects to spend around £3.5 million this year on a range of projects, including in the areas of public financial management, health, regional development and good governance. We also expect to provide assistance to the Georgian Minister for Euro-Atlantic Integration to help to support the implementation, monitoring and reporting requirements of work arising from its new EU action plan.

The UK share of overseas development assistance to Georgia in 2005 was £8 million. The two largest chunks of this came from the European Commission and the World Bank’s International Development Association. Following Georgia’s good economic growth and arrival at lower-middle income status, DfID will close its bilateral programme to Georgia at the end of 2008. However, the UK will continue its contribution to Georgia’s development agenda through multilateral channels.

At the end of last year, Georgia took two welcome steps in deepening its relationship with Europe. In September, the NATO alliance agreed to open an intensified dialogue with Georgia and, in November, Georgia and the European Union signed a European Neighbourhood Policy action plan. This policy holds out the prospect of a closer relationship with, and greater assistance from, the European Union in return for progress on internal reforms. We encourage Georgia to embrace the European Neighbourhood Policy as a tool to help it to move closer to EU standards. In answer to the noble Earl, Lord Sandwich, the European Neighbourhood Policy does not prejudice future applications for EU membership by eligible countries. We hope that the processes involved and the active support of her partners in both the EU and NATO will encourage Georgia to do what is necessary to move closer to embodying the Euro-Atlantic values that we share with her.

The noble Earl, Lord Sandwich, asked about the alleviation of poverty and the millennium development goals. I do not have an answer this evening, but I shall certainly write to him. Georgia has preferential market access to the EU under the generalised system of preferences, and we are encouraging it to make full use of it. The European Commission has begun a process to look at the feasibility of a free-trade agreement with Georgia. I do not have a reply about microcredit and small enterprises, but I will gladly write about that.

It is clear, as the noble and right reverend Lord, Lord Harries, said, that democracy is a matter not just of elections but strong institutions and respect for human rights. There are a number of human rights issues in Georgia that our embassy in Tbilisi continues to monitor

We regularly raise these issues in our bilateral discussions with the Georgian Government and support our European partners, the OSCE and the Council of Europe. We have particular concerns over the situation in prisons. The justice sector as a whole needs serious attention, and places of detention are perhaps the most public illustration of the reforms needed. We believe that there is more work to be done on reform of the judiciary to ensure that its independence is fully protected and demonstrated. There is an apparent willingness at the highest level of the Georgian Government to reform the judiciary. This has been supported by the standards set under the EU action plan and in Georgia’s progress towards NATO membership, and the acknowledgement that external foreign investment needs the support of a strong and independent judiciary. The UK has, through our high-level visitors, used these political and economic levers to highlight the need to drive forward the pace of reform in the justice sector, particularly in improvements in prisons.

Many noble Lords have understandably raised the question of NATO. We, of course, welcome Georgia's developing relationship with NATO. Georgia has participated through an individual partnership action plan in 2004 and, on the basis of progress made, was granted an intensified dialogue with NATO in September 2006. We have been pleased to see these steps forward in Georgia’s relations with the alliance, particularly as they will help nourish not only military and defence reforms but the wider reforms that will help Georgia to develop sustainably.

The processes are designed to support and stimulate modernisation and reform, promoting Georgia’s development as a secure, stable and successful country, including with a view to conflict resolution. The responsibility lies with Georgia to prove to allies that she can be a stable partner. We are sure that that is what the Government of Georgia are committed to doing. We support NATO’s open-door policy, based on the principles of performance and commitment to NATO values, and Georgia's aspirations for eventual membership.

We are grateful for Georgia’s significant support to international operations. I note the views expressed by the noble Lord, Lord Dykes, but I warmly welcome President Saakashvili’s pledge of support to the ongoing missions in Kosovo, Iraq and Afghanistan. From this summer, we anticipate that Georgia will become the third largest troop-contributing nation in Iraq, after the US and UK.

As noble Lords have said, Georgia is experiencing a difficult period in its relations with Russia; but Russia and Georgia need to develop a constructive neighbourly relationship, and our aim is to support them in producing the conditions for that. We have urged both sides to show restraint towards each other, and welcome the fact that the rhetoric has calmed over the past few months. However, Russian transport restrictions as well as economic restrictions against Georgian produce remain in place. We have urged the Russian authorities, both bilaterally and through the EU, to lift these measures and will continue to do so. We also encourage Russia to use its significant influence with the de facto regimes in South Ossetia and Abkhazia to work towards sustainable solutions to these conflicts.

The noble Baroness, Lady Rawlings, understandably raised the summit at Samara. Despite difficulties in the UK and EU relationships with Russia it is important that we continue to engage. The EU and Russia are serious international players with a number of shared interests. The recent summit was part of that engagement process, in which a substantial range of issues were discussed. The EU also raised human rights. Chancellor Merkel was clear at the summit, in private and public, about the importance of protecting peaceful freedom of assembly in Russia. We fully align ourselves with those sentiments.

The noble and right reverend Lord, Lord Harries, asked for an assurance that member states of the European Union were working together. The reported statement of Mr Barroso, president of the European Commission, that a difficulty with one member state was a difficulty with the European Union, says it all.

Georgia is a key energy transit state and has positioned itself strategically to help Europe meet its energy needs. It hosts the significant Baku-Tbilisi-Cheyhan oil pipeline, opened in 2006, and the Baku-Tbilisi-Erzerum gas pipeline, which opened in 2007. These are both important arteries, enabling Caspian gas and particularly oil to reach western markets. The noble Baroness, Lady Rawlings, asked whether the Russians were not just using energy as a form of political and diplomatic power. The energy relationship with Russia must be seen firmly within a G8 context, in which context we will continue to engage with Russia.

In conclusion, Georgia has made the most enormous strides but still has some way to travel on the road to becoming a stable, secure and democratic modern European state. This evening’s debate has been about the current situation in Georgia, but we should not forget that Georgian reforms are a work in progress. We recognise Georgia as a partner in our international agenda, in the promotion of sustainable development and reduction of poverty underpinned by human rights, in energy security and in building an effective EU in a secure neighbourhood. The Government will continue to support Georgia towards the goals that it has set itself.

House adjourned at 7.36 pm.