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Housing and Regeneration Bill

Volume 701: debated on Tuesday 13 May 2008

(First Day)

If there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.

Clause 1 agreed to.

Schedule 1 [The Homes and Communities Agency]:

1: Schedule 1, page 148, line 5, leave out sub-paragraph (1)

The noble Earl said: I remind the Committee of my declarations of interest at Second Reading. The amendment would remove paragraph 1(1) of Schedule 1. That may be a little drastic, but I assure the Committee that it is a probing amendment aimed at provoking discussion on the composition of the board of the HCA.

The Government have set the HCA the target of contributing to the delivery of 3 million new homes by 2020. That represents a building rate of 250,000 homes per annum, of which 70,000 homes per annum will be social, affordable housing. It is an ambitious task—some would say that it is overoptimistic, even unachievable. I know that there was much debate in the other place about whether these targets would be met. I do not want to go down that road: we are where we are. During the past 11 years, in the period of a property boom, only 145,000 new homes per year were built on average.

Many noble Lords commented at Second Reading that those in the building industry will not build any new homes because they cannot sell those they have already built. For them, this makes sound commercial sense. The credit crunch has knocked out demand for the purchase of property. The prospects for new build are bleak, at least for the next two or three years. Even today, chartered surveyors have announced that the housing market has not looked so negative for 30 years.

So the HCA has a huge problem. But it should look at this not as a problem but as a challenge. If there is no demand for open-market housing, where is there demand? There is undoubtedly demand for affordable social housing. Eleven years ago, 1 million people were on the waiting list. Last year, the figure had risen to 1.7 million, and it continues to rise. Those who face repossession of their homes—an estimated 45,000 people this year and goodness knows how many next—will need rehousing. And now first-time buyers cannot get a mortgage. Last year, there were only 300,000 first-time buyers, the lowest number for many years—I have heard that it may be 25 years, but that may be an exaggeration.

At Second Reading, I suggested that the figure for applicants on the waiting list may be closer to 2 million, but even that may be a low estimate. Last Friday, when I visited my dentist, the receptionist was talking to a lady about how her son, who was divorced, had had to move into her spare room with his son. The other lady said that her daughter and child were sleeping on her sofa. I could not resist asking, “Are they on the waiting list?”. They both said, “No, they need housing now, not in 10 years’ time. What’s the point?”. There must be thousands, if not tens of thousands, of people like that. So my estimate of 2 million on the waiting list may be far too low.

The demand for social housing is there and the challenge for the HCA is how to supply and satisfy that demand. Many landlords and councils up and down the country have devised schemes to develop social housing, but they often come up against barriers to delivery. Perhaps I can cite one or two examples. My neighbour in Norfolk wanted to convert redundant farm buildings into five social housing units, but permission was denied as they were just outside the village boundary. There are barriers preventing councils which transferred their housing stock to housing associations providing further meaningful social housing—I think there is a limit of only 50. Seventy-five per cent of the proceeds from buy-to-let are removed by the Government, thus starving councils of the means to build more social housing. There are many other barriers—I have merely highlighted two or three.

I make no apologies for labouring the current state of the market, but it is vital that the board of the HCA continually undertakes this soul-searching about where to concentrate its endeavours. This brings me to the composition of the HCA board. Board members will need to think outside the box, to be flexible, to look at all the options and, above all, at the market conditions prevailing at the time. How will they deliver and what rules need changing to ensure delivery? It is not about words, promises and targets; it is about delivery. To build houses one obviously needs landowners—private, council or developers—housebuilders, planning permission and, above all, money.

I do not wish to be prescriptive on the face of the Bill about the composition of the board, but I would like to throw in a few ideas. There needs to be representation on the board from those organisations which operate at the coal face. Should there be representation from the local government associations as owners of land, providers, or would-be providers, of social housing and in relation to planning issues? What about the Home Builders Federation in relation to owners of land and builders of these new houses? What about the Country Landowners’ Association which represents private landowners? If the initial concentration of effort is to be on social housing, what about the National Housing Federation or ALMOs? Other Members of the Committee may have other suggestions: for example, on regeneration, creating communities and sustainable development. I would also like to see a champion for rural housing represented on the board. All too often rural housing has been an afterthought and it needs someone on the board to fight its corner.

The composition of the board needs to reflect the challenges and demands in the market at any given time. As market conditions and demand change, so too should the composition of the board to reflect those changes. That can be done by adding to the board at a later date. As the Bill stands, the board will be made up of members,

“as the Secretary of State may from time to time appoint”.

That immediately raises a flag in my mind. The challenges will not be met through yes men, nodding approval to any Government’s whim. The board must have broad and balanced representation from those organisations involved in front-line delivery. It needs members who can identify the problems and unlock the doors.

I look forward to hearing the thoughts of the Minister and other noble Lords on the composition of the HCA. I beg to move.

Amendment No. 2, which is tabled in my name, is in this group. It is perhaps not as high minded as the amendment tabled by the noble Earl as I am talking about expertise rather than souls. However, our purpose is the same as the noble Earl’s: to probe what the Government have in mind about the size of the board and, more importantly, who they will look to with what expertise to make up the board, its committees and sub-committees. In her letter to Members, the Minister mentioned the opportunities for particular expertise to be brought in to the different committees. My amendment refers to,

“the desirability of experience of housing provision of all types”.

By that, I mean the different sectors, not bedsit to mansion, but public and private, the different types of public housing—rented, shared ownership and so on—and the experience of regeneration.

What prompted this amendment was that although the agency is to be a new body—a number of noble Lords have referred to the importance of it not being simply a continuation of the previous bodies—there might nevertheless be a temptation to appoint members who have experience of housing associations as distinct from other forms of provision. This is a probing amendment to ask the Government what they have in mind and is not so drastic as to take out altogether the possibility of board members.

In this Room, the phrase comes to me,

“O ye of little faith”.

In this Committee, we are setting out to put some flesh on the bones of a noble and worthwhile exercise. It is always dangerous to start at a certain date and say that is when something happened because these things evolve, but after a period of time, the Government have decided that we need to refashion the major tool that we hope will regenerate the housing situation in this country. Amendment No. 2 is perfectly sensible; as I see it, it seeks assurances from the Minister about the broad brush that will be applied to ensure that the HCA reflects housing experience. It would be unthinkable and unforgivable if it did not. Last week, with some noble Lords who are in this Committee, I attended a meeting at which we heard the prospective chief executive. He left behind a document that stated, among other things, that the objectives of the HCA are:

“To improve the supply and quality of housing … To secure the regeneration of land or infrastructure … To support in other ways the creation, regeneration or development of communities in England or their continued well-being”.

No one can object to those. The fourth major objective is:

“To contribute to the achievement of sustainable development”.

I would hope that Members of this Committee are as one in subscribing to those objectives. I can well understand noble Lords wanting assurances from the Minister and her colleagues that the intention is to put flesh on the bones of those ideas in personnel and strategy to achieve those objectives. I hope that these are genuine probing amendments to get assurances from the Minister rather than a way of beginning the debate on this stage of the Bill by trying to chop off the head of the HCA, which is the kernel of the strategy, because otherwise we are in for a rough time.

I have every confidence that the Minister has come to this Committee with answers to questions that have been raised, but I hope that the thrust of what we are going to do over the next period is to try to achieve the objectives of the HCA, which we heard about from the prospective chief last week.

I draw the Committee’s attention to the declarations of interest that I made at Second Reading. I am also an adviser to Stockland Halladale Europe Ltd.

An interesting set of issues is raised by this amendment and I would like to respond to the noble Earl's points from the perspective of someone who, for six years, chaired English Partnerships—one of the bodies that is coming together to form the Homes and Communities Agency. Some of the points that have been raised have been extremely interesting, because the composition of such boards and the way in which you get that expertise from non-executive directors and, critically, the leadership and tone that such a board sets, not only for the organisation, but on behalf of the Secretary of State throughout the whole sector, is really important. I welcome the opportunity for us to debate these points.

I was very fortunate over those six years to have a range of expertise at the disposal of the English Partnerships board because successive Secretaries of State made interesting appointments. It is undoubtedly the case that in the kind of agency that we are talking about here, with an annual investment budget of £4 billion and a wide range of powers, you need a really high calibre board and people who know what they are talking about. I welcome the noble Baroness's suggestion about a range of people who understand housing in all its aspects.

However, I part company with the noble Earl on the idea that you should have representatives on the board. Having representation in that sense on a board directly cuts across the governance that non-executive directors undertake on behalf of the body and could involve those people in a conflict of interest or, as a minimum, make it awkward for them to carry out their functions. Are they there on behalf of an organisation or to exercise really good supervision and governance over a substantial budget? But I agree with the noble Earl and the noble Baroness that it is important to have the right mix of expertise on that board—expertise that comes from people with experience in the voluntary housing sector, the funding of real estate and in corporate governance. As I said earlier, I was fortunate to have board members of the very highest quality. It is important to raise these issues and to encourage the Secretary of State to think widely in terms of making these appointments.

Finally, on the substantive point about whether this is the right corporate governance structure, it is massively helpful to have an NDPB structure because you have the ability to be clearly directed and guided by Ministers, but you have significant freedom to act, particularly around creating commercial joint ventures and other corporate entities that are important to carry out the work that we envisage this organisation undertaking. We need to have the widest possible, highest calibre expertise available to that agency if it is to carry out its job effectively.

It is a pleasure to follow the noble Baroness. I apologise to the Committee for not having spoken at Second Reading. I completely concur with the noble Baroness. May I also say how wonderfully positive the response has been to these impending reforms? The noble Baroness says that members of the board should not be highly representative, but that can confuse a board.

In following the 1993 Act, “not less than six” does not follow English Partnerships or the Housing Corporation. I think that English Partnerships has 12 board members: one could think of them as two, but I suspect that, because of the group approach, it is more realistic to think of them as having been managed and governed as one. The Housing Corporation has, I think, 14 board members. I cannot think that six board members would ever be appropriate. It seems to be very loose drafting. Why does nothing in the Bill represent reality about the structure and number of members of the board?

That was a great way to start this debate. I am extremely grateful not just to the noble Earl, Lord Cathcart, who outlined why we need the HCA—although, last year, we built 200,000 homes, so we are doing much better—but also for the range of expertise around this Committee, so we will have some excellent debates. I was extremely glad to hear the noble Earl say that this is a probing amendment. Having read it, I thought that this Committee would get off to a pretty ropey start if I had to defend the existence of the HCA. Clearly, it has raised many questions around the Committee—for example, why is it an NDPB rather than, say, an executive agency? The noble Viscount, Lord Eccles, asked about the size of the board. The balance and composition of the board has also been raised.

My noble friend Lady Ford put much more powerfully than I can why it is an NDPB. As she said, we need the balance of an independent, flexible and powerful agency, which at the same time gives the responsible Minister a degree of control over its activities. Although we do not have a national housing policy, we certainly have a policy for housing the nation, and the responsibility of the Department for Communities and Local Government lies in setting those high objectives, values and targets. In the same way as we have created English Partnerships and the Housing Corporation, which have served us so well, we will create the HCA as an NDPB as well.

The agency is challenged by its task, which is why it needs to be as robust as possible. As I said at Second Reading, we have a budget of billions of pounds and its task is to be the best possible delivery partner. Again, I was grateful to the noble Earl, Lord Cathcart, for emphasising the word “delivering”. Whereas policy and strategy sit with Ministers, this board will bring together for the first time all the partners, investment, land and housing, regeneration, decent homes, and growth areas. It will have at its disposal an enormous range of expertise and the power to bring people and partners together for the first time in a new way, which not least determines that the Secretary of State should make the appointments to the board. As my noble friend Lady Ford said, we need to have a credible and strong board with a strong voice. We need to respect Cabinet Office guidance that in situations such as this, the responsible Minister appoints the board.

Amendment No. 2 refers to qualifications and experience. I take the point made by the noble Earl, Lord Cathcart, on the need to have expertise which reflects front-line experience; flexibility, so that as things change we may be able to modify the board; and balance, which goes beyond individual expertise. Combined, those factors will give us a broad range of expertise to address all these different interests. Indeed, paragraph 1(3)(a) of Schedule 1 provides that the Secretary of State must be satisfied that the board appointee is suitably qualified and experienced in matters pertaining to the activities of the HCA.

The board will provide strategic leadership and be the voice—the public front—of the agency. It will be the guardian of delivery and will champion the various elements of the work. The noble Viscount, Lord Eccles, is therefore right to ask whether six people will be enough. It is a minimum number. The fact that there are 12 members on the board of EP and the Housing Corporation—double the minimum number—reflects the fact that the figure can be increased. It is important that the Secretary of State has the ability to ensure that the board of the agency is sufficiently staffed. As I have said, there is a standard power to appoint board members and there are inbuilt accountability arrangements through the Office of the Commissioner for Public Appointment guidelines when making appointments. In practice, therefore, we expect the membership to be greater than the minimum number of six in order for the HCA to be led as we want it to be.

On the question of balance, as raised in Amendment No. 2, it is important that the Secretary of State is free to make appointments which will ensure that the scope of the HCA’s work is representative. I take the point entirely—it was very well made—that we are looking not for representation but for people who have credibility and experience and can rise to the task with which they will be faced. I say to the noble Baroness, Lady Hamwee, that, again, the priority of ensuring a balance and variety of relevant expertise on the board will continue to be governed by the OCPA guidance and will remain at the discretion of the Secretary of State. That flexibility is necessary because of a need, potentially, for modifications in some situations as time goes on. We are looking for demonstrated capacity.

The Secretary of State is making progress with the appointment of board members. I hope to be able to update noble Lords as we go through that process to make sure that they are fully informed as and when we can make public announcements about it. That will be during the course of the Bill.

I hope that I have addressed the issues that have been raised. If noble Lords would like more detail on any aspect of governance I shall be happy to write to them in due course.

I am grateful to the Minister for her response. I apologise for coming in at this stage and for having to leave early today, but I look forward to working on the Bill during its passage. Did I understand the noble Baroness to say that it is now policy that six members are appointed to boards?

Each NDPB is different but there is a requirement for a minimum of six members on a board. But it is a minimum and the number on the board will be at the discretion of the Secretary of State, who will take into account the need to achieve balance.

I thank the Minister for that clarification. I am a little concerned that, as a minimum, six is not a lot. It is not for me to press anything but I think that is a very small number. We are currently considering the draft Marine Bill and if that refers to six members I shall certainly raise the same concern because it is not enough. If it is not laid down in stone it should be reconsidered.

I shall explore with officials whether it is a standard number and write to the noble Baroness if there are implications for other NDPBs.

I shall make one quick point. I realise that I did not refer to local authorities when I spoke originally. They would rightly come down on me if I left them out. Furthermore, paragraph 1(3)(a), to which the Minister referred, contains the phrase, “has shown some capacity”. I asked my noble friend Lord Greaves whether he understood what that meant and he thought that it might be about capacity-building—but I do not think that it is. Experience must be different from capacity, because otherwise one would not have the two phrases. Does that mean some sort of achievement? I do not quite understand what capacity is. Surely, it cannot mean personal capacity to go out with a JCB. I hesitated when I first read the schedule and thought that it was pushing it a bit to try to take the whole of this paragraph apart, but I have been unable to resist temptation at this point.

There may be a common-sense definition of capacity and it may well mean personal—but it may also be another way of saying “experience”. I do not know, is the answer to that question, so I shall have to explore it in writing to the noble Baroness.

I think that that was a good opener for the Committee today. I should tell the noble Lord, Lord Graham, that I do not think that any side of the House does not want to see the housing targets succeed. We all want that; what we are debating is how we best achieve it. I do not think that anybody is going to argue that there is no need for it, and I think that my remarks indicated that.

I was interested and relieved that the Minister talked about the balance, flexibility and expertise that need to be on this board. I understand the point of not having representation from the bodies at the coal face, as there may be conflicts of interest. However, because they know what the problems are and what the barriers are to achieving our goals, it will be vital that, when they come to the board and say that they have a problem and cannot do something because of X, Y or Z, the board should listen and work out how to overcome those barriers, rather than just saying that it is too difficult. If we are going to achieve the targets as we are trying to do, when there are barriers we must look at ways of getting round them. Therefore, if we are not to have representation from those at the coal face it is vital that the board listens and reacts when problems are raised.

I was slightly disappointed that the Minister did not say anything about my champion for rural areas. However, I am sure that the issue will come up again. This is a slightly different picture from the bigger picture, or the other picture, in the urban areas. There needs to be someone to say to the board, “You’re dealing with the urban areas and the regeneration there, or with eco-towns—but what about the rural areas?” There needs to be a champion to remind the board that rural areas are very important.

I am sorry that I did not address that point. There will be an amendment later on under which we will be able to explore it, but I am not in favour of a single champion for rural areas. I would hope that the board will achieve that by having a genuine mix of experience, so rural areas will not need a separate champion because they will be championed by the board. The noble Earl is quite right—there are very different issues and challenges in those areas, but some of them are not that different now. One could take market towns, for example, and some of the other issues that we are looking at with regard to urban extensions. The rural areas must be spoken up for and their interests promoted, but that must be seen as seamless with the work of the HCA.

I thank the Minister. At this stage, that is all that I wish to say. We may need to come back to this at a later date, but for now I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

1A: Schedule 1, Page 148, line 12, after “HCA” insert “(including design)”

The noble Lord said: In speaking to Amendment No. 1A, I will also speak to the other amendments in this group, because they are all intended to promote good design in social housing.

I am grateful to the Royal Institute of British Architects for its stimulus and assistance in formulating these amendments and declare my interest as an honorary fellow of the RIBA. I am also grateful for the encouragement from Members on all sides of the Committee for holding this debate on design at an early stage of Committee proceedings and I am most grateful to noble Lords, again from all sides of the Committee, who added their names to the amendments that I have tabled. That is a reflection that all of us recognise that design is important. I do not think that it is a party-political issue. That was evident in the debates that we held at Second Reading and on architecture and planning on 27 March.

Amendment No. 1A, which would amend Schedule 1, would require the Secretary of State to appoint to the board of the Homes and Communities Agency a person with experience of and capacity in design. I suppose that the distinction between experience and capacity is between experience and ability—both seem desirable. Amendments Nos. 29 and 32 would amend the objects of the HCA to include the improvement of design quality in new housing. Amendment No. 47 to Clause 5 would require the HCA to use its powers to provide housing and land to contribute,

“to high quality design in the built environment”.

Amendment No. 95 to Clause 39 would enable the Secretary of State to require the HCA to supply information drawn from post-occupancy analysis to help make it normal practice that design should be evaluated by asking the residents of these homes what their experience of the design has been. Amendment No. 97 to Clause 49 would enable the Secretary of State to require the HCA to provide that applications for housing provided by it or facilitated by it should be submitted to design review in the planning process.

We have debated the importance of design very fully in our recent debates and I will not repeat the arguments that I put forward. Noble Lords from all sides of the Chamber were eloquent about the damage caused by poor design and the importance of good design to quality of life and value for money. Nobody was more eloquent in contributing to those debates on this matter than my noble friend the Minister. It has also been profoundly encouraging that the Secretary of State for Communities and Local Government, the right honourable Hazel Blears, gave a speech at CABE recently in which she powerfully articulated the importance of good design, insisting that new homes should be “not brutal, but beautiful”, as she put it.

The Government intend that 3 million new homes should be built in this country by 2020. Already, we have planning policy statements 1 and 3 and many other statements of different status from Ministers, making it clear that they expect good and indeed very good design to be the norm in new housing development. They are fully aware how crucial it is that we do not repeat the errors made in previous decades—that we do not create a new generation of slums for the future—in our haste to achieve this ambitious home-building programme. The Government have already stipulated that lifetime home standards should be achieved in publicly funded housing by 2011 and it is their aspiration that this should be achieved in all new housing by 2013. They have also stipulated that new homes should be carbon-neutral by 2016. So they have already made important commitments in those aspects of design.

If the quest for good design is motherhood and apple pie, my noble friend may reasonably ask, why do we need to legislate? If we were to include these amendments in the Bill, would they be workable? She is also entitled to ask whether they would achieve anything worth while. Needless to say, it is my view that we should legislate to reinforce our drive towards good design.

There can only be benefit in using this legislation to reinforce the values and guidance that have been expressed in the planning policy statements. There will otherwise be a wide gulf between the aspirations of Ministers in Whitehall and practice and decision-making on the ground. Of course it is not appropriate for central government to specify particular designs or to interfere everywhere in the detail of decision-making, but I believe that it is right that we should require in legislation that appropriate people are in place and that procedures are followed that will conduce to good design. These amendments would ensure that there would be people in key positions in relation to social housing and regeneration who had serious knowledge of and commitment to design; that in its methods of working and decision-taking the Homes and Communities Agency, which will be under many conflicting pressures, should constantly bear in mind the importance of design; that the minds of independent, knowledgeable, public-spirited people would be brought to bear through design review, making for best practice and for the continuous raising of standards; and that the views of the people who will have lived in these homes should be properly taken into account by the HCA and social housing providers so that they should continuously be learning and improving the quality of provision. These amendments are reasonable, workable and down to earth.

I have no reason to suppose that the HCA would not welcome a strengthening of its arm through this legislation. Those of us who had the privilege of meeting Sir Bob Kerslake, at the meeting that the Minister so helpfully organised for us last week, heard him expressing himself imaginatively and constructively in relation to design. There is no doubt that the predecessor organisations—the Housing Corporation and English Partnerships—have in recent years and, in the case of English Partnerships, when my noble friend Lady Ford was chairing the organisation, committed themselves to better design. However, they may well have encountered resistance because housing providers find themselves under many conflicting pressures. Therefore, it is important that the HCA should be enabled through this legalisation to insist rather than simply exhort that there should be high design quality. Unless we legislate, there is no guarantee that these things will happen.

My noble friend may possibly take the view that my amendments are too vaguely worded or might lay the HCA or other providers open to judicial review. If that should be the case, I hope that she will be able to improve the drafting. I contend that by introducing the expression “design quality” I have made the definition of the objects of the HCA rather more specific than the Government have in the unqualified use of the word “quality”. It could be argued that “sustainability” is a fairly loose term, and other terms that we are familiar with in legislation—“equality”, to take an example from a different field—are generalised terms but we know what we are talking about. Design in this context is a term of art. It is code, if you like, but it is very well understood in its purport by professionals in the fields of architecture, planning, housebuilding, traffic engineering and landscape design, and a considerable quantity of documentation has been promulgated by DCLG and CABE defining the principles of good design, producing illustrations of how those principles are to be applied, proposing best practice and establishing expectations of the relevant professions.

The Government cannot do it all by themselves. They have relatively few levers with which to promote good design. The ability and motivation of professionals will probably be more important than anything else. I wish that the professions in question—the architects, surveyors, planners and engineers—would agree a foundation design curriculum common to the formation of these different professions before they diverge into their specialisms. As it is, each professional institute has its own accredited programme for initial education. It is true that efforts are being made to build in interdisciplinarity, and I am encouraged that there is a pilot model for a curriculum on urban design, which has been funded by the Department for Innovation, Universities and Skills, with the RTPI, the RIBA, the Landscape Institute, the IDA and the Prince’s Fund, as well as the Academy for Sustainable Communities coming together, with the University of Strathclyde taking the lead academically. But that work is intended to design post-qualification studies.

It would be enormously helpful if we could have a common curriculum for these various professionals as they learn their trade, their art and their profession, so that they would understand each other better and more of them would have a more highly developed awareness of the nature of good design and its importance. The fruits of that, if it were to happen, would be as important as anything that the Government could do—although, of course, the Government could continue to play a useful part. The Department for Innovation, Universities and Skills and HEFCE could continue to incentivise and encourage that kind of work.

Meanwhile, we here in Parliament must do what we can. This important legislative opportunity is a prime occasion for us to add to the levers available. I commend the amendments to the Committee and I beg to move.

These amendments add a missing link to the Bill's sense of what the Homes and Communities Agency is for. Its objects already include to improve the supply and quality of housing in England and to contribute to the achievement of sustainable development. It cannot achieve these without enabling good design to be paramount. But we do not have as yet that design culture in all planning authorities and among all housing developers which can achieve the objectives. We have now excellent obligations with regard to sustainability and we need to have a parallel obligation on those concerned to pay attention to design standards and take them seriously.

These amendments flesh out significant comments made in recent authoritative reviews. Kate Barker pleaded for higher priority for design and for enabling design review panels to function widely, adding that,

“the costs of poor design are high”,

and that,

“good design attracts people, investment and activity to places”.

She added, echoing my noble friend Lord Howarth of Newport, that,

“what constitutes good design is well documented”

in both government and CABE standards.

The Calcutt review called for a nationwide system of design review. My noble friend the Minister, no less authoritative, said in her speech at the end of Second Reading:

“I take the point about design-review panels”.—[Official Report, 28/4/08; col. 116.]

These amendments are to help her out.

But they will also help housing developers. Consistent nationwide standards of what is expected are helpful to national firms. To have to do some things in Leicestershire and different things in Yorkshire is not helpful.

Above all, they will help the very many people who will live in new and rehabilitated houses, who deserve proper consideration of the best means to give them homes of beauty, accessible to transport, schools, clinics, places to meet or worship, in communities which are inhospitable to crime and can thrive and prosper sustainably. These amendments will protect and enhance the “dowry”, to use the RIBA's phrase, of the best practice of the Housing Corporation and English Partnerships, and I am sure my noble friend will find them an asset.

I am glad to have the opportunity to contribute to the Committee’s debate on these amendments. I have put my name to a couple of amendments tabled in the name of the noble Lord, Lord Howarth of Newport, because I believe that this is an extremely important issue. As was made very clear in the debate that he led at Second Reading—the noble Baroness will recall that there was a considerable amount of interest in these issues—a number of us are anxious that it is critical to include from the outset an emphasis on design quality in the Bill. That is not least because of considerable concerns about sustainability, to which the noble Baroness, Lady Whitaker, has just referred. Unless high quality designers are involved in the next generation of housing, we are in danger again of creating inbuilt obsolescence in the housing stock of this country, which is extremely damaging not only in the short term, but also in the longer term.

From my experience of working with and for architects, I know how attitudes have changed even in the professions in recent years. In the 1960s, you built for then and now, and if it had to be replaced within the lifetime even of those architects, that was acceptable. Given the concerns that there are about the extent to which energy is used wastefully not only in obsolete buildings, but also in the regeneration, removal and replacement of obsolete buildings, we cannot do that any longer. It is not carbon-neutral. Construction techniques are extremely expensive in terms of energy and in other ways.

The Minister may recall that at Second Reading I referred to my work on the “long life, loose fit, low energy” project when I was working for the Royal Institute of British Architects. It has now come of age, as many Members of the Committee on both sides will agree. That is why it is critical that, in laying down the parameters and the criteria by which we expect the agency to operate, there is emphasis on design quality in the Bill. Designers today are concerned about long life, loose fit and low energy. It is extremely important to have that written firmly in the Bill. Sustainable development is in the Bill and it has a very high priority in the Explanatory Notes, but unless it is explicit that we recognise that design quality is a realistic expectation, we are missing a very important opportunity. I am delighted to support the noble Lord, Lord Howarth, who has been the pioneer in these matters.

I, too, support the noble Lord, Lord Howarth, and the noble Baroness, Lady Whitaker. Amendment No. 1A has come in at the last minute and has put back later amendments for which I was better prepared. My name is down to support an amendment to leave out “and” in an obscure part of the proceedings. I support all the amendments which contribute to raising the profile of design.

The question is the extent to which the Homes and Communities Agency could use powers, if provided through this legislation, effectively to change the design of all the homes that will be built. I am sure that that starts at the point the noble Lord, Lord Howarth, has started it; that is, on the board of the new agency, which takes us back one small step to the discussion of membership of the board. I should declare a past interest: I was the chief executive of what is now called the National Housing Federation—the former National Federation of Housing Associations—for many years, including the years when the Housing Corporation first came into its new form in 1973 ready for the 1974 Act and thereafter.

I was consulted regularly on the membership of the board in relation to those people who might be said to represent in a loose way the housing associations. I wonder whether here, in relation to the suggestions made by the noble Earl, Lord Cathcart, it is not a matter of compelling in legislation a list of organisations to be represented, but of an amendment to require consultation with a number of organisations whose interests should be represented. If that were the case, one of those organisations could well be the RIBA. This would ensure that someone selected—or suggested, if consultation there was—through the networks would champion a design perspective on the board. I declare an interest as an honorary fellow of the RIBA.

Such a mechanism would ensure consultation. For 15 years I was consulted on a regular basis by whoever might be there from the housing association world, which was helpful, but it was never enshrined in legislation. One had to make all kinds of difficult judgments such as whether the position should be for a non-executive board member without a financial interest or for one of the great chief executives with a passion to be there. What kind of a person should it be? A consultative process in the Bill—which any sensible chair of the new organisation would go for—might bolster the HCA’s input on this side.

As to the ways in which a power, let alone a duty, given to the HCA to take account of design might operate, an obligation in the Bill for the agency to take these matters on board could be a highly effective mechanism. Wherever, at its simplest level, it is making a grant, or wherever it is passing over money, the HCA would be able to specify the design qualities that must be taken into account. For example—we shall probably discuss this later—with the lifetime homes’ accessibility standards, which are so important, the HCA could insist that, in return for a grant, the full lifetime homes’ requirements are rolled out now, without waiting for the mechanisms that have been put in place to achieve the Government’s expectations for lifetime homes—in 2010 for housing associations and 2013 for builders. The HCA could get on with this through the mechanism of the grants if it had an obligation for design.

The HCA will also have control of land. Because of EP’s way of working, it can insist that on land that has been assembled, acquired, reclaimed or remediated through its own powers, design factors should be taken into account in the development that follows.

The HCA could also use the mechanism of Section 106 agreements. These require site developers to incorporate various matters in their projects and so, when the HCA is involved in a scheme which has a Section 106 agreement requiring affordable housing to be built alongside the housing for sale, it could insist on the same standards across the piece of the development. Design falls under different headings, which we will explore—sustainability may be encapsulated already in some of the other issues—but this is a foot in the door. The HCA could say to housebuilders, “You have an agreement to provide 50 per cent affordable housing within your development as a whole; the rest may be for sale. We are insisting that, as we have some lien in this, 100 per cent of these homes satisfy the design criteria which we think is right for the development”. Affordable housing as well as other homes should meet the same standards. Why should the people who buy have lower standards than the people who come in through the social housing route?

These amendments are for real. There are opportunities for the HCA to have some muscle in influencing directly the way in which a good proportion of the 3 million homes of tomorrow work their way through the pipeline.

I associate myself with the spirit of the amendment. It has been enormously important in the past couple of years that England Partnerships was given encouragement by the then Secretary of State and the then Deputy Prime Minister to put design on the map. When we changed our evaluation criteria some three years ago—after six years I keep saying “we”; I forget I am not there any more—to look at quality and design alongside the financial bid for land, it made a huge difference to the way in which housebuilders approached projects. It is important that we try to do whatever we can through the Bill to strengthen the HCA’s arm.

However, I counsel caution on two suggestions made by my noble friend Lord Howarth. I am slightly concerned about representation of a senior or eminent architect on the board. I used to have regular unarmed combat with my noble friend Lord Rogers on that; he upbraided me mightily on a number of occasions about our not having an eminent architect on the board—I hesitate to say “such as himself”; I am sure that there was no intention on his part that it would be him. Given the breadth of projects in which the HCA will be involved, it would be extremely difficult to find a single architect whose expertise spanned residential, mixed-use, urban, and rural developments. It is inevitable that one would have architectural experience and a champion on that board, but would that then excuse other board members from taking a proper interest in design? Instead of representation, we had a panel of eminent, experienced architects on whom the board and executives were able to draw for advice on individual, significant projects. I imagine that the new organisation might want to continue that practice, which might be preferable to having a single architect on the board.

I am concerned also about review panels. There is a practical and time issue around that. That is the job of the Commission for Architecture and the Built Environment, not of the new agency. However, the Housing Corporation and English Partnerships have done a significant job in moving space standards, when the private housebuilders did not want to do that. Where the agency invests public money, it must continue to insist on the highest standards. Anything that we can give the agency by way of robust assistance in the Bill is welcome, but retaining the board’s flexibility would be helpful.

I adopt the noble Baroness’s phrase and say that I associate these Benches with the spirit of the amendment; I agree with pretty much everything that she said, including on board membership. I think that those who have their name to the amendments are saying that a focus on quality should be mainstreamed throughout the organisation. It is not enough to make it one person’s job or to confine it to the board. It is rather more important that those in an executive capacity have an understanding of, and experience—or training if necessary—in, the issue. The noble Lord, Lord Best, rightly pointed out that it is about the powers of the agency—there is no good in fine words, unless there is the power to say, “It must not be that and it must be better”.

Sustainability covers quality, if only for the rather simple reason that a building of quality is one which lasts. I shall not prolong this debate, as I suspect that this may not be the only occasion when we focus on this issue in our proceedings. However, I say also that I share some personal reservations—I have no idea what party policy is—about design review panels, which I mentioned in the debate introduced by the noble Lord, Lord Howarth of Newport, not so long ago. It is entirely proper that design is raised in the Bill, and it is a delight to see such an interest being shown in it.

I, too, welcome the amendment. Since I entered your Lordships’ House I have been very encouraged by the concern about quality of design. I was very encouraged by the debate, which I could not attend but which I read, in which the noble Lord, Lord Howarth, spoke, on the quality of design. One can see that there is real concern. However, to a large degree, across the country, we do not have design quality. Design quality is a practical matter. In east London, our experience has been that when you build quality buildings, the social environment begins to change as does the way in which people relate to that environment. My view is that we are the environments in which we live. If we create certain kinds of environments we will create certain kinds of public behaviour; if we create other forms of environments we can create public behaviour which is unhelpful.

Design matters, and it has very serious financial implications. My experience over the years of building and trying to create quality design, is that it is important to have individuals in the process who care, long term, about the buildings. Trying to bring buildings and design together takes a long time and the process is quite complicated. You need someone who cares about the process, who gets out of bed on a Monday morning and worries about it and about the types of buildings that are being built. When I have looked at different developments around the country, I have discovered that generally the buildings that look the best have an individual behind them who worries and cares about them.

The aspiration is there but how do turn it into practice on the ground? There is great concern that that is not happening at the moment. I am involved in a development, in east London, for a very difficult group of estates. We have been through 50 different designs, at a cost of more than £3 million, but still not a brick has been laid. We need to think very carefully about the practical consequences of what the Bill imposes.

I support the amendment. We and the agency need to think carefully about quality, not just quantity. I was very encouraged by my conversation yesterday, which was enabled by the Minister, with Sir Bob Kerslake. He is concerned about these matters and we need to create the kind of legislation that strengthens his hand and enables him to get a grip on this issue. For me, it is about quality before quantity. I support what my noble friend Lord Best says about enabling levers.

Developments need an individual who cares about them. If we are to spend all this money, it has to be about place-making. As we know, in the history of society, place-making is usually about an individual or a small group of people taking hold of a place over time and making something happen.

I am reminded that several years ago I was taken by a group of 10 year-olds—primary schoolchildren—to see round their housing estate and I was shown their homes in a series of tower blocks, which were in the process of demolition. I reflected on what it does for a child’s self-esteem if their home is condemned as unworthy of sustainability. With that in mind, we must design our homes for the future in a better way—homes of which we can all be proud and which will last a long while.

I add my voice to those supporting these amendments—not that I have any great sympathy for the great fat toad of a quango that will sit in the middle of this, as a result of this Bill. My direction is much more to try to get planning and design decisions made as locally as we can. However, while we have this approach from this Government, let us make sure that design gets in properly. Yes, it is difficult and, yes, it is very hard to define exactly what you mean; but, as the noble Lord, Lord Howarth, says, you know it when you see it. It is perhaps not that easy, however. Last week, I received a pamphlet from the Council for the Preservation of Rural England, hymning the idea of high densities in the form of town squares and giving seven examples of them. Six of them were extremely ugly and had won prizes. So it comes down to the difficulties of centralising design in one person sitting on one body. If that person is not the right person, you can get a promulgation of ugliness such as, say, the South Bank, which has taken a long time to get over.

I want to see variety, so I am a supporter of design-review panels, which are voluntary and diffuse—they are all over the place. We will get a variety of answers and we will get Leicestershire and Yorkshire doing different things, for example, which is entirely as it should be. But, most importantly, we will have a body of expertise available for local councillors and others who have to take decisions at local levels and will give them the courage to take design into account in a way that is difficult now, if you are being asked to pit your views against that of someone employed by the developer.

It is sad. Every time I go home along the Thames I look at what has been done with those serried ranks of condominiums, which, if they had an architect did not have a very good architect. As a pleasurable experience, it ranks at about two out of 10—and all that because of the river, rather than the surrounding buildings. It is enormously important that we give a higher priority to design. The fact that we may get that wrong at some times does not matter. What matters is that we get it right more often than we do now.

Almost everything that could be said on this subject has been said, so one hesitates to get up at this stage in the debate. My contribution will be highly idiosyncratic. I do not know what the Minister is going to say: she may say that the qualifications in the noble Lord’s amendment and the amendments of those who supported him are unnecessary. It is the sort of phrase that I have heard from Ministers before, and I dare say that I have uttered it myself. Therefore, I want to add another argument.

One virtue of the amendment moved by the noble Lord, Lord Howarth, is that it acts as a form of amulet against the oscillation in the quality of Ministers in departments responsible for these matters. That is in no sense a reflection on the present Minister, but I have been in Parliament for 30 years and there have been Ministers responsible for the affairs of the relevant departments who were extraordinarily interested in architecture and could be relied on to make extremely good decisions and others who had no interest in architecture whatever. One virtue of the amendment is that it is a protection against the latter.

I shall be straightforwardly personal. My late noble kinsman was Minister for Housing and Local Government. He was vilified for two decisions on buildings that he let through—one on grounds of bulk and one on grounds of height. On the other hand, he was widely praised for preventing a building from destroying the view of St Paul’s from a whole series of different angles, including the Whitestone Pond on Hampstead Heath. There is another building on Knightsbridge which everyone wanted to destroy; it was a listed building, but even the inspector wanted to demolish it. He alone insisted that it was retained, and everybody associated with Imperial College now takes the view that his decision was the right one. Some Ministers will have an interest and some will not—and fortunately his batting average was about even.

By coincidence, yesterday I attended the memorial service of the sort of architect who gets the first obituary in the Times, in St Marylebone Parish Church. On the way out I met the architect civil servant who advised me when I was a Minister and who may well have advised the noble Lord, Lord Howarth. I was the eighth Minister whom he had advised. Our conversation went back to what was then a derelict tower block in Bethnal Green, whose design, to the credit of the local authority, had been entrusted to Denys Lasdun. It was for local authority use and, by the time it came to us, it was, in effect, gutted and in an appalling state. English Heritage wished to list it and everyone else wished to demolish it. The local authority could do nothing with it. The tenants did not wish to live in it. Efforts to put the building into other hands had failed because of the scale of the work that needed to be done. It was reasonably shortly after the creation of what was then the Department of National Heritage, which broke down the Chinese walls that had previously existed in the Ministry of Housing and Local Government, which meant that two departments were making two sets of decisions. The new department made the decision about listing and the old department made the decision about listed building consent or demolition.

We had a meeting lasting three hours to discuss what should be done about it. We knew that we would be extremely unpopular if we listed the building, because we would be transferring it to the other department to make the unpopular decision among architects that the building should be demolished. But we also knew the quality of the Secretary of State to whom we would be transferring it. Since we had the new system where two departments could make the decisions, we took the decision to list it and, if that department still wanted to demolish it, it would have had to have gone to the other department.

I tell that story in support of the noble Lord, Lord Howarth, because it is a moral story. The decision was taken by the other Secretary of State to resist the efforts to demolish the building. A highly imaginative developer came along. It is now an icon building, which people fight to get into. That is a demonstration that quality will out.

I was not going to speak on this amendment, but I should like to add one point to those made by my noble friend. I am provoked by the noble Lord, Lord Lucas, who made some valuable points about how important it is for issues of design to be understood and acted on at a local level, which is where the real decisions are often made. I should declare an interest as a member of Pendle Borough Council, which is a housing authority, a planning authority and all the rest of it. I should also apologise for not taking part at Second Reading. The fact that I could not do so is linked to the fact that I am still a member of Pendle Borough Council. I was otherwise occupied electioneering at the time and managed to scrape back where all my colleagues were falling around me. Such is life and such is politics.

The last time I remember a head of steam building up in the House of Lords on design issues was when we were discussing the Planning and Compulsory Purchase Bill in 2004. Exactly the same sort of head of steam built up, the same arguments were put forward, and the legislation was amended as a result. I very much hope that the same thing will happen and that the Government will negotiate a sensible form of wording to reflect the clearly widespread view that design should be incorporated in the Bill, as happened in that previous legislation.

As a member of a local planning committee—at the other end of the system completely—it has been extremely valuable that local authorities and local planning committees can now consider design overtly as part of the decision-making process. Applications can be changed and can be rejected on grounds of design. Following the changes to that 2004 legislation, and the way in which it was fed through planning policy statements and so on, it is now an important part of the planning process. Some planning officers still say, “Well, I am sorry, I have not done any qualifications in design and I cannot give any advice to the committee”, and some councillors say, “Well, we have no qualifications, but we are going to do what we think is right”. That is what democracy is about, although it is not always easy to defend on appeal. The fact that it is now built into the system at the local level that the noble Lord was talking about is important and valuable, as it is, in a different way, in the area of social housing, regeneration and so on that the HCA is going to be involved in. It is not a panacea because what gets built and how it gets built is inevitably a matter of negotiation and compromise and it is always a question of balancing ideals against practicalities, particularly those of cost. We cannot click our fingers and get brilliant design everywhere, even if we could all agree what brilliant design is, which does not necessarily happen. Nevertheless, putting it there and putting it in the equation, the negotiations and the compromises is important and I wish this amendment well.

I have to remind the Committee formally of the interests I declared at Second Reading. They remain on the record. Having got that out of the way, I hope the Committee will not mind if I explain the rather devious technical device that we are using to have this debate. It is a measure of the importance that all sides of the Committee place on this issue that this procedure was agreed. The manuscript amendment that we are formally discussing, Amendment No. 1A, was agreed by all sides because the noble Lord and the noble Baroness, Lady Whitaker, were likely to have a clash of dates with the second day in Committee next week and it was arguable whether we would get to the rest of the group of these amendments today in time for them to be properly discussed. It was in order to avoid that embarrassment that we are having this debate. I am quite sure that the noble Baroness gave her agreement as speedily as I did. It is a measure of the significance of this subject.

I am grateful to my noble friends Lord Brooke and Lord Lucas for reminding the Committee that design is a matter of taste. Not only are there the complexities of Ministers coming and going, but tastes, fashions and, heaven help us, planning committees come and go, and one needs to have some comment to make on the planning system. One can have the most wonderful architects but in the end planning committees say what will and will not be built. We have all heard criticisms of inappropriate designs for houses and estates. Fortunately, we are long past the words of a song that was around in my youth about little boxes made of ticky-tacky that all looked just the same. I am sure some Members of the Committee will remember that song.

However, the other side of this debate is that we need to remember that for many people any house is better than no house. We have already had some reiteration of the housing numbers. When I started in local government, we were building 360,000 houses a year with all the services that were required. It was a remarkable achievement. It was post war, and there was war damage to recover from and all the rest of it. But, if there was bad design, it was because of the urgent requirement to produce more houses. We have been through that phase and many of those houses have now gone, but some of them remain.

I should probably declare another interest—or confess, perhaps, to an aspect of my life which is a little odd. I have never lived in a house less than 350 years old. Two houses I have lived in have had parts which go back 500 years. That is an immense tribute to the quality of the design of those days. One of those houses depended entirely on prefabrication; it could be built in only one way from one specific post. It is not that they were grand houses; they were timber-framed farmhouses. Plenty of cottages built in a similar period remain in the countryside. The buildings are a tribute to the durability of the materials and the skill of the people who put them up. Whether we achieve that again today remains to be seen; realistically, I think probably not. However, I would like to think that there will be buildings we put up today which will still be here in 500 years time. That is what this debate, among other things, is all about.

We should remember that the quality of architecture now has a great deal to do with the word “utility”. As has been said by others, we need our buildings to be energy and space efficient. They need to be adaptable for a number of purposes; for example, to enable a young married couple to move in, to bring up their children—I was going to say to kick their children out, but they will leave of their own accord—and then to grow old gracefully in. That needs a great deal of thinking about.

I come back to the point that I mentioned when I began. We need to recognise the planning responsibility as well as the architectural and design responsibilities. We have heard about inappropriately designed estates on the edge of old communities that look like sore thumbs. Planning committees will have approved such estates. They did not have to approve them. I once had to lecture to a degree course in planning; I was not asked back again. That was mainly because they were teaching planning as a precise science—which it might be—but I reminded them that the serious planning decisions were all taken by democratically elected members and that, however precise their science was, they would have to learn to put up with a bit of democracy in their planning.

In what we are doing with the Bill—we will come back to this later—there is a need to remind members in local government that they are there to do a job, that they are expected to do it and that they do not deserve to remain in local government if they do not do it. Most people in local government do the job, but very often they take the easy option, particularly in planning matters. You then come to the difficulty, and a different pressure on local authorities, of a lot of planning authorities taking a hard line and demanding very good design, which slows up the development process. I can see the Minister with a grin on her face and saying, “Yes, we shall have to be very critical of them for that”—not for what they are doing on the principle of design but because they will not achieve the necessary volume. We have to remind ourselves all the time that we need volume.

That is all I want to say. I have drifted very much away from the significant question of design because that has been very thoroughly covered in the excellent debate we are having now. We need to remember that there are others in the process—we have not mentioned builders, developers and so on—and we have to get them all positively involved.

This has been an excellent debate. I congratulate my noble friend Lord Howarth on his opportunism and on the coalition of support that he has marshalled around the House, on the way in which he marshalled his arguments and on the way in which noble Lords spoke both to the visionary opportunity as well as—as the noble Lord, Lord Dixon-Smith, concluded by reminding us—the practical needs that we have to address when we try to marshal support for more impetus for design.

I start by addressing some of the issues raised under Amendment No. 1A. However, I shall reflect briefly on what the noble Lord, Lord Mawson, and the noble Earl, Lord Listowel, said about places shaping people. That is where we start from—with the notion that beautiful places may not shape beautiful people, but at least they promote pro-social behaviour. Design has a value in itself, but it also has a value for what it communicates and enables other people to do in the community. Members of the Committee know that I am sympathetic to much of what they have said. If they can bear it, I shall leave my final conclusions tantalisingly to the very end.

On Amendment No. 1A, in relation to this notion of appointing someone to champion design, the challenge for the new agency will be in demonstrating that the skills are appropriate to what it needs. That has to be balanced. So while I am sympathetic to what my noble friend says, and I take the point of the rather alarming picture drawn by my noble friend Lady Ford of having to fight hand-to-hand with architects, I do not think that the proposal is necessary. We need to think very hard about how we put this expertise in the hands of the HCA, however, because there is certainly a role for CABE and an opportunity to develop that sort of relationship. So while I welcome the intent, I wish to give some more thought to how we might best deliver that objective.

I have discovered the answer to the notion of capacity. When we talk about someone with capacity on the board, it means that they have the demonstrable ability and skills rather than expertise, necessarily. So when we think about what we want on the board, that is what we mean by that.

I turn to the substantive amendment, Amendment No. 32. I shall skip over the amendment to which the noble Lord, Lord Best, put his name, if he does not mind, as I do not think that I can have a particularly exhaustive debate on “and”. But there is no doubt that we are all of one mind here; we all want to see the highest possible standards of quality and design, not only in private architecture but in the public realm, in the built environment. I shall take Amendment No. 47 at the same time and discuss the notion of the built environment.

We are seeking to build ambitiously and build for a new generation. We are seeking not to repeat the mistakes of the past. We must make that clear in the leadership that we show, the policies that we have in place and the way in which we use all the levers—and they are limited levers. The noble Lord, Lord Dixon-Smith, was right to point that out, but we have to use everything to hand.

During his Second Reading speech, my noble friend Lord Howarth was concerned that the instruments that make it possible for planners and local politicians to deliver better than in the past—guidance, exhortation and reward—are not enough to see the real improvement needed. He both raised and answered on my behalf the questions that he thought that I would put to him. I would probably come up with a few different answers, but I need to make it clear that, although I am sympathetic to his intent, there are two major considerations that we have to address, which he has already identified.

Is the amendment necessary to achieve the desired outcome—to put design at the heart of all new development? If it is necessary, is this the best way in which to achieve those desired outcomes? I have to be persuaded that the amendment is necessary to be put in the Bill. I take the point made by the noble Lord, Lord Brooke, that predictably I would say that. However, as he knows as a former Minister, we have to test to destruction the notion of what is necessary. Design is already—admittedly, not explicitly—covered by the objects of the HCA, but it is underpinned by planning law.

The agency’s objects refer already in Clause 2(1)(a) to improving the quality of housing. That is about the built environment. I ask the noble Lord what we mean by quality if we do not mean quality of design. Quality is not merely functional, but it can ensure that the home, the place, is pleasing and desirable. I argue that quality without successful design is meaningless.

Clause 2(1)(c) gives the HCA the object of supporting the continued well-being of communities. We have spoken this afternoon about the quality of place and place-making. The well-being of communities means that we need places that are well designed, sustainable and beautiful—places which make the spirit sing. It is hard to see how well-being is served by places that are ugly, cramped and confined. We all know of past design failures where we seem to have designed in crime rather than designing it out.

Clause 2(1)(d) adds contributing,

“to the achievement of sustainable development”

to the agency’s objects. The noble Lord, Lord Tyler, was right when he talked about getting away from built-in obsolescence. We shall come back to that when we talk about lifetime homes. A key element of sustainable development is good design. That is given explicit force in law by Planning Policy Statement 1: Delivering Sustainable Development, which states,

“Good design ensures attractive usable, durable and adaptable places and is a key element in achieving sustainable development”.

This debate has raised a degree of passion, to which I have listened carefully. I wish to do that passion justice by giving equally careful consideration to how best to address this. The second point is whether this amendment is the best way of achieving that outcome. I am unsure about that for a couple of reasons. The supply of housing, as defined in law, includes the supply of particular types of housing, so we are not simply talking about the HCA delivering numbers but about it delivering particular types of housing for the enormous diversity of people who need good homes. I cannot in good conscience say that making it clear that the HCA would not meet its object of improving quality if it did not also improve design quality is anything other than helpful. I accept that.

I am slightly nervous about this wording because, in a sense, the HCA would always have to seek to improve design. I think there is a point beyond which realistically one would not be searching for innovation for the sake of it. I am also not sure that putting an amendment such as this into the Bill will help the HCA focus its activities where it could be of greatest value in tackling the problem of design quality and the barriers that prevent it happening at the moment.

Those barriers were identified at Second Reading. The noble Lord, Lord Dixon-Smith, addressed the problems and quality of the planning committee, the training and supply of planners, the lack of qualified people, and the fact that it is very difficult to get people to focus on design when they are challenged by a new development with all the complications that arise. We are addressing this by placing the ASC at the centre of the work of the new agency, ensuring that we have, for the first time, a mechanism for getting training and advice into local authorities in a new way. We are also empowering the HCA to provide training and advice as well as support services, such as seconding or loaning staff. That will all make a real, practical difference to how local authorities can respond. However, I am concerned whether the amendment will secure the change.

I am also considering how the HCA will interact with CABE, which is an enormously powerful and positive influence in this area. I am very aware, as a Minister who has a lot to do with planning inspectorates, just how seriously planning inspectors now take their design responsibilities. I have recently written to CABE on this issue. I want to discuss that role further with noble Lords and colleagues in CABE, the HCA and DCMS.

I ask my noble friend to give me some time in which to consider his amendment. Notwithstanding everything that I have said, these are serious arguments. There is no point putting something in the Bill if it does not produce the changes that we all want to see. I want to hear the views of other noble Lords. It has been an excellent debate and I shall bear in mind my noble friend’s advice.

I thought that Amendment No. 95 would be about empty homes and how design failures had led us to having some 600,000 empty homes; I can see now that it is not and that my noble friend is proposing a rather interesting idea. I would probably want to talk to Bob Kerslake about how we might pursue it in the context of the Bill. There are issues around it which we need to tease out. Asking people how they find the new accommodation which is provided is very interesting. I have the privilege of meeting people in new homes, particularly in housing market renewal areas. Their joy at having space, separate bedrooms for their children and a garden is extraordinarily powerful. I know that people who have worked in the housing association sector know exactly what I mean.

On the final amendment, Amendment No. 97, on design review panels, I was interested to hear some of noble Lords’ qualifications. Having seen some design review panels in action, I agree that they are powerful instruments for improving how people are trained to look at and appreciate good quality in design. Bringing design professionals and planning officers together to review schemes in pre-application is a promising and productive approach. It will give force to the HCA’s role in place-shaping that all its schemes are of the highest design quality. However, the amendment will not deliver my noble friend’s desired outcome, not least because he asks for a power of direction for the Secretary of State. It is a very powerful tool, which must be very sparingly used. An example would be a Secretary of State issuing an accounts direction, directing the Housing Corporation to include certain financial information within its annual accounts. It is an inappropriate instrument for this purpose. It would be used only in limited circumstances. All that creates problems for what my noble friend seeks.

However, I am sympathetic towards aspirations to improve design quality. The suggestion of an enhanced role for design review panels is interesting. I would like to explore it further outside the context of a power of direction for the Secretary of State. My noble friend Lady Ford asked how we find the people. We need more skilled people in planning; we need to recruit planners from other disciplines. Time and expertise are a problem. However, given what my noble friend said, given that we want to build on the good work of English Partnerships and the Housing Corporation and given that CABE is in place, I would like to think about how we can deliver some of the outcomes that he wants to see in the context of design review panels.

The noble Lord, Lord Dixon-Smith, has revealed to the Committee my machinations and those of my noble friend Lady Whitaker. I repeat how grateful I am to him, the noble Baroness, Lady Hamwee, and the Minister for their willingness to accommodate this debate today. I apologise to the noble Lord, Lord Best, for my being unable to get hold of him yesterday evening, when the tactical need arose. I am hugely grateful to everyone who has spoken in this exceptionally interesting debate. I am greatly encouraged by the positive approach taken by every single noble Lord who has spoken.

We all recognise how important it is, one way or another, to ensure that in this great wave of housebuilding that is going to take place—and the HCA may be responsible for the construction of some 30 per cent of homes envisaged—those homes are well designed, good homes. My noble friend the Minister spoke eloquently, again, about the importance of beautiful places and the shaping power that they can have. The noble Lord, Lord Mawson, and the noble Earl, Lord Listowel, spoke out of the depth of their long-standing concern and direct personal experience about the traumatic effect of bad design and poorly designed homes on the lives of people who are so unfortunate as to live in them. We know that we must do very much better.

The noble Lord, Lord Best, opened a very interesting and exciting perspective with his suggestions that the HCA might be able to use leverage to influence the design quality of the products of the volume housebuilders and that through the operation of Section 106 and other mechanisms we might be able to ensure that the generality of homes provided outside the social sector could be somewhat better. This is a crucial problem. With the present structure of rewards and penalties, there are simply not sufficient rewards for private developers—the volume housebuilders—to invest in good design. If we can find ways, through the operation of the HCA, having required through this legislation the HCA to take the constructive and proactive approach to design that we have discussed, the whole urban landscape and the whole development of housing could be improved. I thought that that was a very important consideration.

On the reservations expressed by my noble friend Lady Ford about two aspects of my proposals, I take very seriously—as the whole Committee does—the difficulties that she describes, as she is exceptionally experienced in this field. However, my amendment would not require that an architect as such should be appointed to the board; it should be someone with experience and capacity in design. She may take that as being little better than a quibble. I recognise that she makes an important point: if we should find ourselves appointing someone to a board who would, even if they were not obsessive about design, feel that that was what they were there to speak to all the time and that that was their single mission, that would not be a good way to constitute a board. I agree with what I think that she is suggesting—that every member of a board should have a universality of responsibilities and should play their full part in ensuring the good governance and management of the organisation.

My noble friend Lady Ford was right, too—just as the noble Baroness, Lady Hamwee, was right—to say you have to mainstream this commitment to design as a culture. The question is how you do it. If we are to have a board of possibly 12 people, however, it is not at all unreasonable for a Secretary of State in making those appointments to ensure that one of those 12 board members has some greater knowledge and avowed commitment to promoting good design and would play a full part in that regard. But it needs to be a part of the culture and it needs to be the expectation of the whole board and the chief executive that design will be mainstreamed.

My noble friend also expressed some doubts about design review, saying that it could cause delays so that we get a slower pace of development. I am not persuaded by that argument because it seems to me that if we can use pre-application discussion with design review panels, we stand a better chance of ensuring that the applications for building and development that are put to planning authorities are well considered, that right from the beginning there are high standards and aspirations in what is proposed and that the wrinkles and difficulties that there may initially be in applications are ironed out so that not only will we get better quality but we could well save time through greatly reducing the number of planning appeals.

My worry is that the Homes and Communities Agency cannot set itself up as the arbiter of good taste and aesthetics in design—this speaks to the point made by the noble Lords, Lord Lucas and Lord Greaves. That is the role of democratically elected local authorities. My worry is that changes to the Bill would give the sense that wherever the Homes and Communities Agency subsidises development it is its responsibility to constitute those design review panels.

I do not think that anybody would envisage that the Homes and Communities Agency should set up the design review panels, but we trust that there will be an extension of the design review facility universally across the country. The department and CABE are thinking about how to extend design review beyond the regions to become available to planning authorities in major cities and perhaps at county level, so it would be there and we would not be charging the HCA with that responsibility.

The need to ensure that we get better quality proposals has been emphasised by the noble Lord, Lord Mawson, in his anecdote about the 50 different design proposals in his part of London, none of them any good. That is borne out by CABE’s Housing Audit which reported that no less than 29 per cent of housing developments were so bad that they should never have received planning permission. We are not getting good enough design as it is. We have clearly got to find a solution. Even if the amendments that I have tabled are not perfect, I was encouraged that the noble Lord, Lord Greaves, who is, as always, at the sharp end as a member of a local planning committee, feels that the requirement on planning committees that they should promote good design and the resource made available to them by, for example, design review are beneficial and help him in his work. We would be going with the grain.

The Minister was, as always, generous, positive and constructive. I appreciate the tone of her response. I am glad that she is going to think hard about the role for CABE because the interaction between CABE and the HCA, even if it is not expressed in the Bill, is going to be important in practical terms. That is part of addressing the question of how we are to impart more pervasively the appropriate abilities and skills within the HCA. CABE has been recommending post-occupancy analysis, so I am sure that a conversation between the Minister, her advisers and CABE would cast further light on what that might be about.

Are the amendments in this group necessary? I take the view that exhortation has not worked historically and is unlikely to work in the present circumstances, given the pressures to cut corners, make haste and economise. I also think that while planning policy statements have legislative force, they are insufficiently strong instruments to achieve what we need. That is why I have suggested that we should use this legislation to develop procedures that would help to ensure that the whole enormous process tended to produce better results than it otherwise would.

My noble friend mentioned that she was worried that what I was proposing might lead to innovation for the sake of it—endless innovation. I am not so much interested in innovation, although of course talented people and creative professions will always be innovatory. I would be at least as happy to see traditional architecture, where that was what people wanted for their own homes. We are not talking about whether architecture is contemporary, cutting edge, innovative, or all those code words to denote modernism; we are talking about design quality. Whatever the style chosen in which to build, we should be designing and building well. That is my concern. The agency and social housing providers should, through these requirements, continue to learn and to do things better.

If my noble friend wants time to think, I know she will do so in a constructive spirit. If I or any other Members of the Committee can assist her in the process of thinking, I am sure she will welcome that. I shall withdraw what the noble Lord, Lord Brooke, called the “amulet amendment”—but I shall not throw away my amulet. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 2 not moved.]

3: Schedule 1, page 148, line 13, leave out paragraph (b)

The noble Baroness said: I shall speak also to Amendments Nos. 4, 5, 10 and 11. This group of amendments takes us, I hope fairly briefly, to some matters of governance of the new agency, particularly the question of declarations of interests.

The first amendment would take out the provision that the Secretary of State must be satisfied that a prospective appointee to the board has no,

“financial or other interest likely to affect prejudicially the exercise of the person's functions as a member”,

and seeks to probe what interests the Government have in mind. I hope the provision is not meant to exclude everyone who has experience, or indeed capacity. It cannot be; that would not make sense. However, is it not part of the Nolan approach to appointments that one does not appoint someone who has a major interest? I do not know. That is why I ask the question. The issue of interests is important but I do not know why it needs saying.

The Secretary of State will have to satisfy himself—herself, at the moment—over a range of matters regarding candidates’ qualifications. Are we talking about a current interest or, as is often the case in other contexts, about an interest that applied over the previous three or five years? I am also interested—this takes me on to subsequent amendments—in how this lies with paragraph 9 of the schedule, which also deals with interests.

Next in sequence is paragraph 1(4), which states that the Secretary of State may require a candidate to provide information. The Minister said on the previous set of amendments that it was necessary to test provisions to destruction. I am not convinced of the necessity for this. How much do we have to put into primary legislation? Is it necessary to state that in an appointment process the Secretary of State can ask for information from a candidate? Frankly, if a candidate did not give the information, the Secretary of State would think that there was something odd and the application would probably go in the bin. That is my testing to destruction.

Amendment No. 5 would insert a new, slightly different paragraph. On balance—or more than on balance—I would really not like to exclude candidates who have good qualifications for membership of this new agency.

The other amendments suggest that the arrangement that works in local government is really not a bad one and is better and perhaps less degrading than is suggested in the Bill. In local government, an individual member, not being fingered by his colleagues—which is what is proposed here—makes a declaration and, if it is prejudicial, that member will take himself out of the decision-making environment. He will actually leave the meeting, rather than being removed as is proposed in the schedule. That is the thrust of my Amendments Nos. 10 and 11.

It has been a shorter debate than on the previous group of amendments, but these amendments are important in a different way. I beg to move.

In one sense these amendments are trivial but in another they are very important. If the HCA is to work properly, most of its members will have interests that are in some way in conflict with the work that they are doing. That is an issue that has to be faced. There is only one way in which to face it, which is to ensure that it is all completely out in the open. Provided that we are satisfied that that is what the process will provide, we will not have any difficulty. I am sure that that is the motivation behind the amendments and equally sure that it is right that the question should be asked.

I make a slightly different point from my noble friend. I have a great deal of sympathy for what lies behind the amendments tabled by the noble Baroness, Lady Hamwee. I wish I had a fiver for every time I sat and listened to the response of Ministers to amendments such as these; the arguments seemed to vary enormously between Bills and departments. I remember the success that Mr Kaufman secured by writing a book on how to be a Minister as soon as he finished being a Minister. It would be no bad thing if somebody were to undertake that task in the context of this part of a Bill. It would then be possible for people like the noble Baroness, Lady Hamwee, and me to have some idea of what kind of ground rules the Government were collectively working under. The criteria being applied seem to vary from Bill to Bill.

Often the most innocuous-looking amendments reveal the greatest issues in the Committee. I am grateful for the noble Baroness’s explanation. I was a bit puzzled by her amendments because Amendment No. 3, for example, seeks to remove the ability of a Secretary of State to make an informed decision on whether a potential board member’s interests, financial or otherwise, would impact prejudicially on their ability to undertake the functions of a board member. That would remove a very important part of the judgment that the Secretary of State needs to make.

Obviously, before making an appointment it is important, for reasons that we have already rehearsed this afternoon, that the Secretary of State is in full receipt of all the information that she needs to make that judgment.

If, for example, the person is a landowner or member or employee of another organisation, the Secretary of State will have to consider the potential implications of those interests balanced against the activities they would be expected to carry out as a board member. As we have said earlier, we are looking for people with relevant knowledge and experience. It may be that they will have financial or other interests that are relevant to the work of the agency, but it may also be that those interests will not affect their ability to do a very good and significant job on the board. Therefore, one needs that flexibility.

The noble Baroness asked about the relationship with paragraph 9 of Schedule 1. We provided in that paragraph that should any particular interest held by a member impact on a particular committee or sub-committee’s considerations, he or she should declare that interest to the committee. The ability of the Secretary of State to exercise discretion over those interests when making an appointment is separate from the impact that those interests may have on the functions and activities of the HCA. That is how it ties up.

To expand on “other interests”, perhaps the noble Baroness would be interested to see the text taken from the application form for the chair of the HCA for the recommended wording in the Cabinet Office guidance on making and managing public appointments. It states that he or she is required to,

“give details of any business or other interests or any personal connections which, if you are appointed, could be misconstrued or cause embarrassment to the Homes and Communities Agency or communities or Communities and Local Government (CLG). These could include financial interests or share ownership, active connections with a field of expertise in which the Homes and Communities Agency work, membership of societies, activities, associations or employment or a partner or friend in the particular field in which the public body operates. Any potential conflicts of interest … will not prevent you going forward to interview but may, if appropriate, be explored with you … to identify how you would address the issue(s).”

That is a fairly full account of what we interpret as being “other interests” as well as financial interests.

The noble Baroness asked why we need Clause 4 in the Bill. The amendment would remove the ability of the Secretary of State to request information from a potential appointee who could help to explain the nature of any financial or other interests that people may hold, which would restrict the ability of the Secretary of State. As I have explained, it is a perfectly legitimate request. I seem to remember that when we debated the GLA Bill last year, we had a debate on the nature of information that would be requested under different circumstances. It might have been a different point, but I seem to remember that we had a not dissimilar debate.

Amendment No. 5 is very closely related to Amendment No. 3. Again, it removes the ability of the Secretary of State to request information from a potential appointee that could help to explain the nature of any financial or other interests that a person may hold in relation to their ability to exercise the functions of an HCA board member. That, again, would restrict the ability of the Secretary of State to make informed decisions about the suitability of potential appointments.

Schedule 1(1)(3)(b) requires the Secretary of State to be satisfied that an appointee has no financial or other interests. That is the correct test and we do not want to remove the responsibility from the Secretary of State for deciding the nature of the interest held and the impact that it could have. We have already spoken today about the importance and significance attached to the work of the board and its wide scope and its need to have very credible, powerful advocates and so on. This is obviously a decision that needs to rest with the Secretary of State as long as she is in full receipt of all the necessary information. When a public appointment is made, someone has to take responsibility for satisfying themselves that the appointee is suitable. We again are driven by Cabinet Office guidance, which suggests that in these circumstances it is the responsibility of the Secretary of State to exercise that discretion.

In relation to Amendment No. 10, I accept what it seeks to achieve, which is to be commended. It is about securing openness and accountability in public bodies, which I appreciate—but, predictably, it is not necessary. Alongside this legislation there is guidance in place that sets out that all NDPBs must have a code of practice under which board members must operate. I understand that English Partnerships has such a requirement that places discretion in the hands of the chair of the committee about whether a member should remain on that committee if they have an interest. The Housing Corporation has a similar provision in its code of conduct. Therefore, it makes sense that the new agency has a similar requirement in the code of conduct that its own board members will have to adhere to.

I also suggest that, should a board member consider it appropriate, they could themselves seek to leave the meeting. Clearly, legislation is not required to enable them to do that. It may not just be for reasons of any interest that may be held; there may be issues such as previous involvement or certain knowledge of the issues, so it encompasses a wider spread. I know that Members of the Committee will be aware that the Committee on Standards in Public Life has set out the seven principles by which public appointees should carry out their functions, often referred to as the Nolan principles. We would expect the HCA board, as with every other public appointee, to adhere to those principles.

I hope that that helps to clarify concern on that particular amendment. Amendment No. 11 follows much the same procedures. It has made me think carefully about the actual proceedings in committees versus the theoretical proceedings. I understand the intent and it is to be applauded, because it would formally require any former member who has a declared interest to absent themselves from the meeting while the particular matter is under discussion. In practical terms, I believe that it is already standard procedure and we do not need to include it in the Bill for the reasons that I explained, particularly in relation to the code of conduct. With those caveats, I hope that the noble Baroness will be able to withdraw her amendment.

I am grateful for the comments of other Members of the Committee. Of course, it is entirely right that there should be a code of conduct. I have no quarrel with that at all, but I find it odd that it is not necessary to say in the Bill that there should be a code of conduct or some reference in the way that I put forward, but it is necessary to say in primary legislation—in a Bill of 222 pages—that the Secretary of State can ask questions of the candidate when a candidate is applying for an appointment. I am sorry if I am repeating myself. Let me make it entirely clear that I do not have any argument with Cabinet Office guidelines or with the desirability of seeking information. But the Bill does not say that the Secretary of State should appoint the best person for the job. If it were to say anything about what the Secretary of State should do, it could have said that, but common sense prevailed.

On the point made by the Minister about the Greater London Authority, we were debating whether the Assembly could require information in connection with confirmatory hearings. The distinction is that the Assembly will not be taking the decision: it is simply seeking to put into the public arena the issues around particular appointments, which is a different issue. I heard what the Minister said. I did not expect to win on this issue, but I did feel a need to air it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 4 and 5 not moved.]

6: Schedule 1, page 148, line 23, at end insert—

“( ) One third of the members shall retire three years after the commencement of this Schedule and shall be eligible for re-appointment.

( ) Thereafter, one-third of the members shall retire each year by rotation.”

The noble Viscount said: In moving this amendment, I shall also speak to Amendments Nos. 7 and 12. I return to some of the things we debated earlier this afternoon. The noble Lord, Lord Graham, said, “Please remember the objectives”, which was a telling point. However, I suppose that it is true to say that they have not changed much. All of the objectives in the predecessor bodies are similar to the objectives in this Bill, which will be in the Act. The biggest single change is the creation of Oftenant by splitting out the regulatory functions, but that is more a matter of how to do it than whether the objectives are different.

I was struck by a comment from the Minister when she talked about independence and having a strong board. That is very important. If the HCA is to perform better in difficult circumstances than its predecessors, the degree of independence that it has is very important. I was also struck by my noble friend Lord Brooke who said we should remember that Secretaries of State change and Acts of Parliament go on, Governments change and Acts of Parliament go on, and the predecessor Acts have done rather well. I believe the New Towns Act was in 1981 and in 1985 there was a change—and in 1993 we had the Urban Regeneration Agency. I remember that many responsibilities went to English Partnerships as a result of a manifesto commitment of 1997.

It is important to remember that there are degrees of continuity and that changes are made. In those circumstances, how does a board have certainty? How can it understand how it will be selected and how much of a franchise it has? It seems to me that, reading the schedule as drafted, the Secretary of State can give a member of the board any kind of terms that he decides. That seems to me too discretionary and almost arbitrary.

That takes me back to the numbers. I refer to my noble friend Lord Brooke, who said that it is quite good to know what the rules will be and not to be surprised by the rules because they are different in similar circumstances. As is frequently the case, I would like to see a minimum and a maximum—say, between nine and 15 on the board. I do not suppose you would want 15 and I do not suppose you would really want nine, but you certainly would not want six. After this afternoon’s discussions, the idea that six people could cover the waterfront for this £4 billion-a-year agency seems to be completely unrealistic.

On Amendment No. 6, I am not in any way tied to the wording, but, from day one, the board should understand its own position. It would know at the end of three years—I prefer three years to five years—that a third of its members would have to retire. The Secretary of State will either reappoint them or not. From there onwards, each year, one-third of the members of the board will retire. Everyone on the board will know that that is the way it will work. I believe that three years is quite long enough for people who had the requisite experience when they were appointed to get their feet under the table and to become major contributors. I also think that working on the basis of one-third of members retiring each year is an extremely healthy situation. Everyone will know where they are and the Secretary of State will be free to determine how the one-third is dealt with. This is a very sensible system. How that is put into the Bill is entirely a matter for the Minister.

Amendments Nos. 7 and 12 are probing amendments. Amendment No. 7 is a very small probe. I am perfectly clear that the chief executive of the HCA will be the accounting officer. Amendment No. 12 is more material. I need to read out a couple of things to the Committee. The English Partnerships financial statement said:

“The Commission and the Agency are sponsored by CLG which in turn is governed by HM Treasury”—

a rather wonderful sentence, that. It went on to say:

“There is regular liaison between CLG and English Partnerships to ensure that Departmental Expenditure Limits are met and to ensure that accounting treatment is consistent with HM Treasury guidance”.

Last year’s accounts, published in July, state:

“Accounts Direction given by the Secretary of State with the consent of the Treasury, in accordance with paragraph 9, schedule 18 of the Leasehold Reform, Housing and Urban Development Act 1993”.

Where has the Treasury gone? It is not in the Bill. There must be a reason for that. It seems unlikely that the Treasury will disappear. It seems unlikely also that it will not continue to wish to exercise the same control over the behaviour of non-departmental public bodies which it has always exercised. High-spending non-departmental public bodies in the monitoring group usually face people not only from their sponsor department but also from the Treasury. The Committee needs an explanation as to how this will happen. If you were a cantankerous chief executive of a non-departmental public body, which I was certainly judged to be many years ago, you would look at this legislation and say, “I don’t get letters from the Treasury. What’s this about the Treasury? I only get letters from the Secretary of State, because there is no mention of the Treasury in my Act of Parliament. I have no formal link. Parliament has not decided to give me a formal link with the Treasury”.

A full explanation of the role of the Treasury in the face of the HCA and how it will change, if at all, from the way in which matters operate today, is needed. I beg to move.

My noble friend has pointed out a genuine lacuna in the Bill. A body such as this, with the resources that it will have, will turn over money at a fairly rapid rate if it is working effectively. One hopes that it will be a profitable operation, and the Treasury will definitely want to take an interest in it. I doubt that it would let the Secretary of State retain any positive balances in the department; I am quite sure that they would go back into central funds. We should have a proper explanation of the relationship with the Treasury.

The terms of appointment should be clear. A minimum of three years is insufficient. I rather like the idea of retiring the members in thirds but their being eligible for reappointment, which would keep them turning over but also allow for the accidents of history—although they can be taken care of by other means. It would make everybody quite clear about the ground on which they were working. They would know that they would be there for three years if they were doing the job well. They would probably continue for three more years, and three more after that, if they were successful. They need that certainty. A minimum of three years is not sufficient for an appointment of the calibre of person whom we hope to attract into this job.

I am grateful to my noble friend Lord Eccles for his kind remarks about my earlier contribution. His point about the Treasury is exactly the sort of thing which might go into the publication to which I previously alluded. There must be circumstances in which the reference to the Treasury is important and circumstances in which it is not. It would be much easier for all concerned if we had guidance in advance.

The noble Viscount, Lord Eccles, said that, under his amendment, people would know where they stood. They would be there for three years and then, whether they liked it or not, would be terminated or their services not renewed. Three years is a short time in the life of what I hope this body will evolve into. From a strategy point of view, we are looking at 10, 15 or 20 years at least. It is 20 years since such a major change as is envisaged in the Bill. We are looking for people to devote themselves, their lives, their careers and their prospects substantially, if not wholly, to the fulfilment of the strategic objectives of the Bill. People might argue that there are elections every three or four years and it is up to the electorate to take them off if they want to, but I am not looking at this as a resting place for politicians. The political complexion of individuals will probably be known and balanced, but we are looking for men and women who can devote themselves to the strategic objectives of the Bill for a period longer than three years. I know the noble Viscount, Lord Eccles, and his supporters may say that if they have done a first-class job, they can be renewed. Of course they can, but uncertainty about whether they will be renewed after three years is a heavy burden. The Minister may have something to say on that.

In the absence of these amendments, I remember that there is a body that recommends a finite limit to the useful life of a member of a body of this kind—I think it is 10 years. If we are looking at a 10-year membership, or two periods of five years, that is more acceptable and agreeable. Above all, the officers of this body need to rely not just on continuity but also longevity. I would not be surprised if some people who were originally appointed were there for many years, but under this amendment, some people who are appointed would possibly be for the chop after the first year because the three-year rotation system must take place. I do not look forward to members of the body that has these imperatives looking over their shoulders every year at a major change in the membership. I look forward to what the Minister has to say. I do not like the amendment and hope that it is not acceptable to her either.

The HCA must prepare an annual report on how it has exercised its functions and send a copy of that report to the Secretary of State within such a period as the Secretary of State may direct. When is that? Will it be six months after the year end or six years? How long after the year end? Is there a normal practice? Secondly, will the report, accounts and statement become public documents? Will people be able to look at them to see how it has been exercising its duties?

I am grateful to all noble Lords who have spoken in this important debate. The noble Viscount is always rightly concerned with good governance. I am very grateful for the support of my noble friend because he brought up some important issues that would be likely to arise if we were to accept the noble Lord’s amendment, no matter that it is tabled with good intentions.

I hope that I can reassure my noble friend that there are standards and guidelines to ensure that the recruitment of board members is open and fair. We rely on the Office of the Commissioner for Public Appointments, OCPA, which already has clear guidelines on the length of appointment terms for board members. A member’s term of appointment will not generally last for longer than 10 years and this period may include two terms of office—for example, two terms of five years. To be appointed for the second term of five years, the member would have to have received a satisfactory performance assessment, so I am sure that noble Lords will agree there is a measure of performance reporting. I have just checked with my noble friend Lady Ford who tells me that the average tenure on the board of English Partnerships was five years. It will be a matter for the Secretary of State to determine the length of appointments, but she is bound by these principles.

I worry that the amendments proposed by my noble friend—my noble friend Lord Graham alluded to this—may not be sensible in terms of good and stable government. There would be built-in inconsistency and turbulence if you had to recruit a third of the board every year. That would disable strategic leadership. I hope that the noble Viscount in particular will accept that argument and be reassured by it.

I turn to the noble Viscount’s Amendment No. 7. He is absolutely right. The accounting officer is indeed the chief executive—who will be Sir Bob Kerslake—which is the normal procedure.

On Amendment No. 12, it is charming to hear that the Treasury has so many friends around the Room and that noble Lords want it to be more, rather than less, visible. An explicit requirement for the Secretary of State to give HMT approval prior to issuing an accounts direction is not needed. The current financial requirements placed on public bodies stem from the Treasury’s guidance, Managing Public Money, and the financial reporting manual. Under the requirements of this guidance, all sponsoring departments must have a framework document that sets out what the specific responsibilities of the body will be. One part of that is the accounting arrangements. The Secretary of State of the sponsoring department must issue to the body an accounts direction that has the agreement of HM Treasury. Therefore, the Secretary of State is already under a duty to consult HMT before issuing any accounts direction. The Treasury’s involvement in the form of accounts that the HCA will issue is therefore implicit; it will be required before any directions issued by the Secretary of State under paragraph 12(5) of Schedule 1. I am fairly convinced, although I stand to be corrected, that this is fairly common practice in legislation, which is why we do not need the explicit approval of the Treasury to be mentioned in the Bill, but I shall be happy to hear what the noble Viscount has to say.

I thank the Minister for her reply and I thank noble Lords who took part. If I do a quick piece of arithmetic, my rotation of the board is very unlikely to leave anybody on the board for fewer than six years and is most likely to leave them on for nine years and in exceptional circumstances for 12 years, so I do not think that I am a long way away from 10, if you work out what my amendment means. I am not going to die in a ditch for two periods of five years as against three periods of three years. I am looking for certainty in the minds of members of the board about their circumstances because they talk to each other about their chances of being reappointed. They have those discussions. If they are to act as an independent and strong board, they need that certainty and to have as much doubt removed from their lives as possible.

It is absolutely fine to talk about guidelines, but I would prefer that Parliament decides on these matters. Guidelines can be changed whereas Acts of Parliament are more difficult to change. These provisions give the Executive too much power and the Secretary of State too much discretion and too much flexibility, which it would be better to reduce. I may wish to come back to this matter.

Just before concluding, there is another inconsistency. Sometimes the chief executive is a member of the board and sometimes not. No reason is ever given for why on this occasion we decided that the chief executive should be a member of the board and on that occasion we decided the reverse. One has a suspicion that the reasons lie in the terms of agreement with the individual, and Parliament is unsighted on that. That is not right. I happen to support the chief executive not being on the board because a fully independent set of directors on a non-departmental public body is better than mixing it up in a private sector mode with executive directors. I must choose my words carefully, but it is much easier for the Treasury to control the game if the board is unitary than if it is wholly non-executive. That comes from hard experience of having been both chairman and chief executive of more than one non-departmental public body.

I thank the Minister for her answer about the question on the Treasury, but the point goes rather wider. For example, in relation to a housing corporation’s finances, the Housing Associations Act 1985, which is still relevant, states:

“The Treasury may issue to the Secretary of State out of the National Loans Fund such sums as are necessary”,


“The Secretary of State may act under this section only with the approval of the Treasury”.

The Treasury comes into the whole question of borrowings, the terms on which the borrowings are made and on repayments in one or other of the Acts. It is not only a matter of the accounting directions, which is an administrative matter about which I have no problems. I can see that it is entirely sensible to be controlled by directions issued by the Secretary of State with the approval of the Treasury. The Minister said that it was not necessary to have that in the Bill. I think that it would be better to include it, but I would not die in a ditch over it. However, other aspects of the Treasury's involvement need to be reconsidered.

I certainly respect the noble Viscount’s experience, and I listened hard to what he said. However, I regret that I forgot to answer the point made by the noble Earl, Lord Cathcart, about the annual report. I will have to write to him about the timing of the annual report because this is a question that is being sorted out as the transition moves forward. Annual reports are usually public documents, but I will certainly be writing to him about the questions he raised.

This morning I was reading on my parliamentary laptop the 2006-07 report published in July 2007. I shall refer to it again on the matter of committees—it is absolutely clear about what the affairs of English Partnerships have been. Meanwhile, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 7 not moved.]

I beg to move that the Committee do now adjourn during pleasure for a period no longer than 15 minutes.

Moved accordingly, and on Question, Motion agreed to.

[The Sitting was adjourned between 6.08 and 6.23 pm.]

8: Schedule 1, page 149, line 37, at end insert—

“( ) No member of staff shall be a member of the HCA nor of any committee or sub-committee.”

The noble Baroness said: In moving Amendment No. 8, I shall speak also to Amendment No. 9. Amendment No. 8 removes a provision of the schedule and replaces it with pretty much, but not quite, the exact opposite. This is another point about governance. It is not at all personal to any members of staff of the HCA who have been or may be appointed, but it is to provide that no member of staff should be a member of the board, a committee or a sub-committee. The noble Viscount, Lord Eccles, trailed this in his last amendment, and I entirely agree. Members of the board and members of the staff have entirely distinct roles and responsibilities in an organisation of this sort, which should not necessarily follow the model of a city corporation or a PLC. They are quite different responsibilities and it muddies the waters if the chief executive—I assume that that would be the member of staff primarily at issue—takes board decisions.

I raise this point in the particular context of London, where I understand—although I do not know whether it is still proposed—that the Mayor of London will chair the London sub-committee with the chief executive being the vice chair. That muddles who is taking the decisions. Political decisions as well as executive decisions will have to be taken. I am not suggesting that the chief executive and others will not contribute to the making of policy, but policy is made and the executive should carry it out. I have said enough for the Minister to respond. One could obviously have this debate in great detail and at great length, but I suspect that that would not be favourable to the Committee this evening. I beg to move.

I am not in support of this amendment, and I will explain why by way of illustration. The kind of committees and sub-committees that I imagine the Homes and Communities Agency will have will not be dissimilar to the type that we had at English Partnerships. One example would be the Milton Keynes Partnership Committee, where not only were non-executive board members of English Partnerships in membership, but the chief executive was the accounting officer of the organisation, so it is not dissimilar to what is being proposed in London. The practical point is that not only was the Milton Keynes committee very time consuming and we could not always ask non-executive board members to give the amount of time or expertise that was necessary, but there were day-to-day delegations to that committee that could best be supported by full-time members of staff. The sub-committees that the agency will have are different from the kind of committees and sub-committees that one might find in a local authority—they tend to be more executive in nature than concerned with policy. For those reasons, I would encourage the Minister to resist the amendment.

I have a good deal of sympathy with the noble Baroness, Lady Hamwee, about the mayor chairing that London committee. We must remember that more than half the budget of this organisation will be invested in London, so this sub-committee will be an immensely powerful body. Notwithstanding the nature of the London sub-committee, the accounting officer of the organisation will still be personally accountable to the Secretary of State and to Parliament for the use of those funds, so it is essential that the accounting officer is a member of that committee. However, I would think that the more appropriate opposite number for the mayor would be the chair of the new organisation, although it is important that the accounting officer is there. For reasons of practicality, oversight and providing the best kind of advice, we must resist an amendment that would cut the accounting officer out of sitting on these committees. We could cast the net more widely and make sure that we had the right kind of executives on the type of executive committees that this agency will principally be engaged with.

I am a little uncertain. The annual report and accounts of English Partnerships records the audit committee, the remuneration committee and the major projects committee—I may not have the title quite right—and all members of the board are entitled to attend. Another, which I suspect comes out of the new towns, is Milton Keynes, which is a joint committee and has probably been in existence for a very long time. We are talking about committees and sub-committees of the board.

Perhaps I may clarify that. The Milton Keynes sub-committee is quite new. It was created only three years ago and is a full sub-committee of the English Partnerships board. Because it was a sub-committee of the board, our vice-chairman sat on that committee, but the accounting officer who had oversight of the investment programme of that sub-committee was a full member of our board. From the noble Viscount’s previous comment, I understand it is not the model that he would like to see, but it has served us extremely well.

I thank the noble Baroness for that and I am entirely sympathetic to the point. Under this paragraph, the Secretary of State is plunging into the game of committees to far too great an extent. I cannot understand why the agency cannot govern its own proceedings. Of course, there is some throwback to the 1993 Act, which states that,

“the Agency may regulate its own procedure (including quorum) and that of any committee”.

But paragraph 5(2) of Schedule 17 of the 1993 Act states:

“The Secretary of State may give directions as to the exercise by the Agency of its power under sub-paragraph (1) to regulate procedure”,

which is strengthened in paragraphs 6 and 7 of Schedule 1 to the Bill. Has the Secretary of State ever given directions on how the board should proceed? Where are they recorded? No doubt, they would be in the accounts of the year concerned and not repeated every year. It would be interesting to see them.

I do not understand how a non-departmental public body can be expected to be independent and strong if it does not even regulate its own procedure. That is a contradiction in terms. People are appointed to be members of a board. There is a code of practice and guidelines, and you would expect it, led by its chairman, to regulate itself satisfactorily. The same thing is stated in paragraph 7:

“The HCA may, subject to any directions … decide … its own procedure and … the procedure of any of its committees or sub-committees”,

which is a sweep up on top of all the other conditions put onto them. What sort of direction might the Secretary of State wish to issue to the HCA on its procedure?

Perhaps I may help with that. By and large, these organisations have been in charge of their own procedure. I take the noble Viscount’s point that the audit committee, the remuneration committee and the nominations committee were always simply comprised of non-executive directors, as you would expect in terms of good governance. Let us take the example of Milton Keynes: notwithstanding the fact that that sub-committee was to be a sub-committee of the English Partnerships board on direction or guidance or by request—I cannot remember which it was at that point—we were left in no doubt that the Secretary of State was very anxious that the local authority should have full representation on that body and that the business community and voluntary organisations would do likewise. I recall that the appointment of the independent chair to that sub-committee, Sir Robert Reid, notwithstanding the fact that it was a sub-committee of my board, was made by the then Deputy Prime Minister. I do not know whether that helps the noble Viscount or maybe just gives him more grist to his mill.

I thank the noble Baroness for that. The Minister said earlier that directions were a powerful sanction weapon because you must comply with them. Having listened to the description of the noble Baroness, Lady Ford, I would have thought that could have been reached by agreement. I bet it would have been reached by agreement in an ordinary exchange of views and would not have needed a direction to make it happen.

I am on familiar ground of my own. I am bothered about the way in which directions are creeping into all kinds of Acts of Parliament when they are not necessary. They weaken the independence of the bodies concerned because if you know that there is a power in reserve to give you directions about how you should organise your own procedure, you cannot afford to ignore it and you have to take it into account.

It is always possible to have a committee of the board and to have the people who know what you need to know in attendance, but you do not always have to form a committee. If in another life I was the chief executive of the HCA and not on the board, I would be very quick to give the chairman advice about how to organise his committee structure.

When I first looked at the amendments I thought they made good sense. The arguments have been developed a little further but to me it makes sense that no member of staff—and that includes the chief executive—should be a member of the committee or the sub-committee or on the board. For example, at a council level you do not expect the chief executive to be a member of the council. He attends all the council meetings, gives very good advice, which is valued and listened to, but he is not a member of the council. As my noble friend Lord Eccles said, he can attend sub-committees and contribute very well indeed, but he does not have to be a member of the board or the sub-committee and that is the right way round.

It has been an interesting debate and I have learnt a great deal in the process. I am not sure that I will add very much to that sum of knowledge. This will not be the first time that I shall say how grateful I am to my noble friend Lady Ford for showing how, in practice, much of what we are trying to achieve with the HCA has been successfully anticipated in English Partnerships.

It is important that staff members of the agency are allowed to participate fully in some committees. Reference has been made to executive committees and we spoke earlier about the importance of expertise and practical, on-the-ground knowledge. That knowledge also needs to be in committees, as appropriate. A practical example is the finance committee that currently exists for English Partnerships. I know noble Lords will agree that it is right and proper that the finance director for English Partnerships is allowed to sit and participate in that committee and take part in decisions. If the amendment were agreed to, that simply would not be possible.

As my noble friend Lady Ford said, the HCA will have numerous committees and sub-committees. We have a practical problem here because if we do not have expert staff supporting the work of those committees, we will have to have a much bigger board. Quite simply, there will not be enough people to cover the HCA’s wide range of responsibilities. We have already spoken about the Milton Keynes English Partnerships committee. I imagine it would have been a serious disability if there had not been that member of staff on EP helping to direct and shape expenditure and growth in the area covered by the partnership. I would not like to see the amendment knock that out of play. It should be remembered that the chief executive is a staff member. He also sits on the board and that is considered good practice by Cabinet Office guidance. That is another thing that would be lost under the amendment.

On the point made by the noble Baroness, Lady Wilkins, the London sub-committee will be an extremely important part of the HCA board. The noble Baroness is quite right, the chief executive will be the vice-chair of the committee and the Mayor of London will act as the chair. For all the reasons that the noble Baroness knows from her wide experience of governing London, we see the chief executive’s position as absolutely essential, given the challenge posed by housing and regeneration in the city. The intention is that the committee will report to the HCA board on the scope and level of work undertaken by the agency in London, and the involvement of the chief executive will help to ensure that it meets the needs and requirements. The specific arrangements for that sub-committee are still being decided.

I shall turn to the final amendment in this group and pick up some of the points that the noble Viscount, Lord Eccles, made. In it, the noble Baroness seeks to ensure that staff members cannot easily become full members of committee. Paragraph 6(4) of Schedule 1 would allow staff members to become members of a committee or sub-committee, but only with the express approval of the Secretary of State and, given what the noble Viscount has said about the role of the Secretary of State, I cannot believe that he would welcome that. It would certainly create an additional workload, and it is inappropriate for the Secretary of State to be involved at that level of detail. It does not make any sense. We, like him, expect that matters of this sort will be discussed and agreed amicably. For example, we will be discussing the role of key staff, such as the chief executive and the financial director, in the internal governance committees in the HCA and the role that staff will play. This will be managed sensibly, but the board will be accountable to the Secretary of State for the operations of the agency, with the staff being accountable to the board, subject to their overall accountability to the Secretary of State. I shall not repeat myself, but I hope that that response helps to clarify the roles we expect members and staff of the HCA to play in relation to committees and sub-committees.

The noble Viscount, Lord Eccles, asked whether we know of any directions that have been issued in this context. My noble friend Lady Ford referred to the direction that has been required for the Milton Keynes partnership. I do not know of any others. Although the power is in the Bill, it is extremely unlikely that the Secretary of State would issue directions on a matter such as committee procedures. It might be necessary in extremely rare cases, but it is very unlikely, let alone routine. The amendments would prevent the HCA playing the full role that it needs to play, bearing in mind that it will need the full support and expertise of its staff. I believe that to have staff on the right committees, as appropriate, would be an important part of its ability to respond to the challenges that face it.

I remain troubled. There is no suggestion that the chief executive or other members of staff should not attend and give advice, but there is an enormous distinction between advising and being part of the decision-making process. The Minister referred to the staff being accountable to the board. That is how I still see it. I also find troubling the proposition that one has to create a committee substantially consisting of staff because the board members cannot manage to attend the number of committees, particularly when it is possible to appoint people outside the pool of board members and staff to committees and sub-committees. Perhaps we should look at the scheme of delegation for the new agency when it comes along. I do not want to try to trip up the noble Baroness, Lady Ford, but it occurred to me that in the scenario she painted there might be the possibility of a quorum being achieved by members of staff only. She is nodding. That supports my case. I will think about this further. For reasons known by those who have followed the recent sagas in London, governance arrangements are uppermost in my mind, and I would like to see this governance-proofed, if I can put it that way, before we give it our blessing. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 9 to 12 not moved.]

Schedule 1 agreed to.

Clause 2 [Objects]:

13: Clause 2, page 1, line 10, leave out “The” and insert “Working through the planning system and in partnership with local government and the other agencies already involved, the”

The noble Lord said: It is a pleasure to return to the beginning of the Bill. It is quite unusual to commence a Bill at the end. I compliment the Government on the brevity of Clause 1, which is remarkable. It fulfils all the needs because the detail is in Schedule 1.

We now turn to Clause 2, which is not quite so satisfactory. It is drafted in perfectly clear language and states:

“The objects of the HCA are—

(a) to improve the supply and quality of housing in England,

(b) to secure the regeneration or development of land or infrastructure in England,

(c) to support in other ways the creation, regeneration or development of communities in England”—

and so on.

That may be fine for English Partnerships and the other, what I would call, contributory bodies being subsumed into the organisation, but although one has no difficulty with the objects, the clause does not pay due respect to all the other organisations involved. Standing in isolation, if the board were to look at those objects and say, “This is our function”, it would not work. We know it would not work; the noble Baroness knows it would not work; and she has said so. I am the first to acknowledge that she has made it perfectly plain that if this new agency is to work well, it has to work within the planning system and in co-operation with the local authorities which deal with planning and so on.

The amendments in this group are simply designed to make that plain. The way in which the clause is drafted is almost cruel as it disregards the huge quantum of work that is done across the whole community, with no acknowledgement whatever.

I shall be a little naughty and quote from a couple of speeches which the noble Baroness made recently. She will recognise them. The Minister said:

“I stress that the Government will look to involve and consult closely local authorities when the use of these clauses is being considered. Indeed, in the one example that we have so far, when English Partnerships used its similar powers in Milton Keynes, the local authority was fully involved in establishing the delivery vehicle.

“With such a range of powers, noble Lords will want to be assured that we are not creating a behemoth or a juggernaut that will slow things down, impose top-down demands or frustrate other partners—whether housing associations, regional development agencies or local authorities. … The relationship between local authorities and the HCA will be critical. The agency will be no less than local government’s best delivery partner, working with the grain of local ambitions and local needs, while securing the achievement of government targets”.—[Official Report, 28/4/08; col. 43.]

That is absolutely fine. A bit later on the same day, the Minister went on:

“With powers come relationships, particularly relationships with local authorities. The powers of the HCA are wide because the task is wide. I believe the objectives that we have already expanded upon in another place meet the task before us. Because the objectives are wider, the powers we are taking—in relation to planning they are inherited powers—will be wider, too. Let me give the sort of assurances that were given time and again in another place by Ministers that the powers that we have taken are exceptional. They will be exceptional in use and will be governed by the Secretary of State's involvement. We will be in discussion with local authorities on the very rare occasions when the HCA needs to take planning powers… I turn to relationships with local authorities, which goes to the heart of much of what the HCA will be able to achieve… The HCA sits within the planning system. Nothing that the HCA will do will be outside the planning system. Its relationships with the regions—the regional spatial economic strategies, the future single regional strategies and local development plans and frameworks—will be crucial… the key to success will lie in its ability actively to collaborate at regional and local levels”.—[Official Report, 28/4/08; cols. 115-116.]

I could go on—I have more underlined—but I really could not have put it better myself.

I am grateful to the noble Lord, Lord Greaves, for putting his name to Amendment No. 13. I thought that my name was a bit lonely on the Marshalled List until I realised that the Public Bill Office could not read my writing. I handed in a printed page with a heading on the top and added the name of my noble friend Lord Cathcart in script. They clearly thought that it was a slip of the pen—which it was—but it was deliberate.

There is a very important issue here. The amendment is not being proposed to change the Bill in a very substantive way, but I tabled it because it would improve the psychology of the Bill. There are in the country a lot of people who are very worried, despite all the assurances that they were given in the other place, which the Minister has repeated, that this agency has the potential to become a monster. We need to write on the Bill words that ensure that it cannot become that. This does nothing to prevent, in appropriate circumstances, the allocation of planning powers, if that is deemed necessary. But the issue of partnership and co-operation will be absolutely fundamental to success.

The Government’s housing targets are not for social housing; they are global housing targets, with a large quantum of construction aimed deliberately at the private sector where the demand, even now, goes far ahead of the available supply—and I disregard the existing situation, which exacerbates the difficulties that the housing industry faces. Demand is much greater than supply, and we have to find a way round that, which will not be done if there is a feeling that somebody could ride roughshod over the local communities who are already very heavily involved and committed to development to meet their needs. There is a third party that we have not mentioned but which is equally disregarded: the whole development industry, which is used to working in partnership with local authorities through the planning authorities. They have an intimate relationship and they work closely, so we need to make sure that that can continue.

This is really a psychological amendment, which I hope that the Minister will take very seriously. I have not suggested that she could just stand up and say yes to it. I suspect that she is not going to be so gracious and do that, but it would be lovely. I beg to move.

I took pity on the noble Lord, Lord Dixon-Smith, for the loneliness of his name beside this amendment and added mine to it. I did so also, and more importantly, because I agreed with the sentiments behind it. I shall speak also to the remaining amendments in this group, which are in my name and that of my noble friend Lady Hamwee.

I associate myself with everything that the noble Lord, Lord Dixon-Smith, just said. It is very important that when this large new national quango is launched on the world it is welcomed by all the organisations and people that it will have to work with and through if it is to begin to achieve all the objectives set for it.

Amendment No. 28 would set out that the basic relationship between the HCA, local authorities and other agencies, particularly the local agencies, is primarily one of support. My amendment reads:

“In seeking to achieve the objectives … the HCA shall … primarily support and facilitate the work of local authorities and other agencies, and only carry out work itself in exceptional circumstances, and … only carry out work in exceptional circumstances with an order from the Secretary of State”.

I think that that is what the Minister said in the material read out by the noble Lord. If they are not her exact words, they certainly represent the general feeling behind them.

It is not a partnership of equals that is envisaged—it cannot be, because the HCA will be the body with all the resources and all the loot. It can put that into schemes in the social housing and regeneration sectors, and into other work that it does. Local authorities in particular will need to get those resources from and through the HCA. As the HCA will in many ways have the whip hand over whether to provide the resources, it has huge influence and power already. It is clear that if the HCA wants to carry out many successful schemes, it will have do so in a way in which the local authorities co-operate and which they think is the right way forward; otherwise, in extremis, the local authorities will simply say, “We’re not going to do it, because we don’t agree with it”. There is nothing new about this: it is the way in which the Housing Corporation already works with RSLs, and English Partnerships with local authorities. The greater the co-operation and agreement, the greater is the success. There is nothing new or exceptional about it.

Clause 5 states:

“The HCA may provide housing or other land”.

It is a bare statement which is not qualified in any way. The clause goes on to state that it,

“may facilitate the provision of housing or other land”.

“Facilitate” is a good word here; it is exactly the relationship that should apply. When it says that the HCA may provide housing or other land in an unqualified way, there is a threat that the agency will come in and use its powers, regardless of what the local authority or local people think. So Amendment No. 46 is to qualify that.

Amendment No. 48 is to qualify a similar statement that the HCA may regenerate or develop land. Amendment No. 49 refers to bringing about the more effective use of land and qualifies it in the same way. Amendment No. 50 is to qualify the bald statement that the HCA may provide “infrastructure”. There is a nice list on the previous page of the Bill, in Clause 2, as to what infrastructure includes—everything from water, electricity, gas, telecommunications, roads and other transport facilities right through to burial facilities and any other community facilities not falling within the previous list. So it is pretty well everything, really. Again, I suggest that that should be qualified.

Amendment No. 52 would qualify the powers to deal with land, which ranges from,

“acquiring, holding, improving, managing, reclaiming, repairing”,

and so on, housing and other property, right through to demolishing derelict buildings. I have a few derelict buildings in my part of the world and I would be delighted if the HCA came and demolished them—but I would rather that it did so after asking us whether it was a good idea, rather than just coming in and doing it. If it does that, it will get some of the wrong ones.

These are probing and challenging amendments, which ask exactly what the relationship between the HCA and local authorities will be. What is the extent to which the HCA may take over local authority functions and the planning functions, as well as the ones listed in the amendment—as the noble Lord Dixon-Smith, said? In what circumstances do the Government expect these powers to be used? Perhaps most importantly of all, do the Government expect that these powers will be used in agreement with the local authority, as we are told happened in Milton Keynes, or to override local authority objections to what is being proposed? The obvious topical issue, where people are worried that these powers might be used in opposition to local feeling, is the whole question of the so-called eco-towns, which may or may not be imposed on communities whether or not they like them. If the Government decide to go ahead with eco-towns and the local authorities in the area do not agree with it, are these the powers that they would use or are there some other powers in the Planning Bill or elsewhere?

Those are the key questions on the relationship between the HCA and local authorities. I do not think that local authorities generally object to the creation of the HCA; they are concerned that it will be a bigger and possibly more monstrous quango—but one hopes that it will not. But because it is bigger, perhaps it will have more clout and local authorities will have less discretion and less say about what happens in their areas. That is the basic issue that the noble Lord, Lord Dixon-Smith, and I are trying to tease out. We look forward to the Minister’s reply.

Perhaps I may help by giving some clarification along the way. Both noble Lords have used the words “monster”, which makes me feel somewhat like Frankenstein. My hair is not looking too good today.

I was not using it for myself but quoting what other people had said. I shall defer judgment on that until I have heard what people say.

The noble Lord has ruined my joke.

On the amendment proposed by the noble Lord, Lord Dixon-Smith, I have an enormous amount of sympathy with the sentiment that he expressed. He said that he was trying to send a psychological message, which is absolutely right. I like that for two reasons: first, it is eminently faithful to not only the thought that went into the creation of the new agency but the extensive round of consultation that took place in the summer of 2007, when exactly that kind of stall was set out by the team that I led and we tried to describe how the new organisation would operate. The words here are exactly the words that we used at that time.

Secondly, I rather like it because I think it will be greatly welcomed by the board and the staff of the Homes and Communities Agency. To a man and woman they would agree that that would be the way, ideally, they would want to operate with partners and local authorities. So, for those reasons, I rather like the noble Lord’s choice of words.

The noble Lord, Lord Greaves, made some interesting points about the nature of the planning powers of the new organisation. English Partnerships had old planning powers that were residual to the New Towns Act and at any time over the past 10 years we could have chosen to use those powers in new town jurisdictions to override the local planning authority. That was not desirable philosophically, and politically we were always encouraged by successive Secretaries of State not to even contemplate it. In Milton Keynes we agreed with the local authority that it was important to use local authority planning powers rather than rely on the old English Partnerships powers under Section 7(1). All of the work that took place in Milton Keynes in that period happened through the normal Town and Country Planning Acts.

In contrast, I tried on a number of occasions to move along developments in Basildon, another former new town, and the local authority there, for a variety of reasons, was not sympathetic to what English Partnerships was proposing or trying to do. Theoretically, we could have used our own planning powers on those sites, but the board never dreamt of doing so. We were certainly heavily discouraged by different Secretaries of State from going down that route. In fact, occasionally people were frustrated and thought that we might get on if we did use these powers, but there was never any encouragement, explicit or implicit, to do that. I cannot imagine many, if any, circumstances in which the new agency would dictate terms to local authorities. That would be contrary to the spirit of how the agency is being set up.

I know he is here at present but I shall spare the blushes of the designate chief executive, Sir Bob Kerslake. I cannot think of any circumstances in which Bob would create a culture where there was anything other than a proper and genuine partnership with local authorities.

The only concern that I have about the amendment of the noble Lord, Lord Dixon-Smith, is that in singling out local government we do not pay much attention to the fact that the Homes and Communities Agency, particularly where sub-regional infrastructure crosses the boundaries of one or more local authorities, will work absolutely in line with the decisions of the regional spatial and economic strategies. So, in that regard, it also has to pay close attention to the regional bodies as well as individual local authorities as it goes about its business. It is a small quibble, but I very much support the spirit of what the noble Lord is seeking to do and I have a great deal of sympathy with the amendment. I shall leave it to my noble friend the Minister and others to comment more fully on the planning, but I would say, genuinely and sincerely, that that was never the intention of the way in which the plans for the agency were laid.

I have complete faith in my noble friend’s good faith towards local government. The noble Lord, Lord Dixon-Smith, quoted my noble friend’s words of reassurance and I do not doubt that every one of those excellent sentences was spoken with complete sincerity. But we should take seriously the concerns of the Local Government Association and the world of local government about the potential power of the HCA in relation to local government.

Of course, my noble friend Lady Ford, drawing from her experience as chairman of English Partnerships, has offered us important reassurance. I very much take what she said about the disposition we can confidently anticipate from Sir Bob Kerslake. Anyone who is aware of his record of service to local government, as chief executive of the London Borough of Hounslow and of Sheffield City Council, will not doubt that he is a local government man and a very good friend of local government. That offers us important reassurance.

None the less, the symbolism of the powers proposed in this legislation, and the symbolism and psychology of Amendment No. 13 in the name of the noble Lord, Lord Dixon-Smith, are important. During my political life I have witnessed repeated assaults—indeed, smash-and-grab raids—by central government on local government. These have occurred under Governments of both parties. If ever the fiscal excesses of the loony left justified the extension of Treasury control that occurred in the 1970s and the 1980s, there can be no justification for them now, in economic terms, in the global economy in which we find ourselves. The old arguments that a bit more borrowing by local government would crowd out the capacity of the private sector to invest may or may not have had a grain of validity 30 years ago, but they do not have any relevance now.

We have chosen to constrain ourselves, in signing the treaty of Maastricht, to maintaining public borrowing within 3 per cent of GDP, and we have to take account of that constraint, but I would like to see local government spending and borrowing fairly and squarely accountable to local electors. If local electors do not like what their local authorities are doing, if they think they are running up excessively large bills and an excessively large burden of interest, it is open to them to kick them out and elect someone else. That is how our democracy ought to work.

The relationship between central and local government is, perhaps, in this sense a zero-sum game. We have seen central government progressively aggrandise themselves at the expense of local government. I have seen too many Ministers of both parties who built their early careers in local government—and no doubt were stout defenders of the rights and the virtues of local government—approach life very differently when they arrive in central government, being overweeningly dismissive of local government.

The Treasury has aggrandised itself over central government as well as over local government. It was always unbearable to the Treasury that it was unable to control some 25 per cent or 30 per cent of public spending. Over the years it has made sure that its control has been tightened and tightened.

This attrition of local government over some 30 years has been an attrition of our democratic culture. That is an extremely important matter. There has been a better tendency in recent years through modest devolution and restoration of powers back to local government. But what has been given has been measured out in coffee spoons, grudgingly and minimally, and expressed in the condescending language of “earned autonomy”. When my right honourable friend David Miliband was Secretary of State for Communities and Local Government he had a principled view that the democratic scope and dignity of local government ought to be restored. So as we examine the powers over local government proposed for the HCA, we should be sensitive to these matters and recognise that, for all its good intentions—and perhaps for all the necessity for some of these powers—the HCA will be an unelected body and its accountability to the people will be more remote than the accountability of local government.

I hope that in her comments on the burden and spirit of this and other amendments relating to the relationship between the HCA and local government, as well as in other public statements where her words may be more widely heard than words spoken in Grand Committee in the Moses Room, my noble friend will unmistakably express the sensitivity which I know she has for the understandable concerns of local government.

I declare an interest as president of the Local Government Association and have only one simple sentence to add. Accepting Amendment No. 13 would send out a powerful, positive signal to the world of local government without making any concessions to the things that the Government wish to proceed with. A simple point.

I would like to come down to earth. I come from the north-east and I remember very well the arguments with Middlesbrough and with Stockton on the subject of Middlehaven and the north bank of the Tees—the north Stockton bank. That was one of the things that led to the disappearance of the urban development corporations. There was real anger that powers had been taken away from the local authorities at that time. It was of course under a different Government but memories are long. This subject needs to be treated with the utmost care because people are not going to forget what happened on those occasions, nor how long it took English Partnerships to assume the responsibilities—it had to find out what had been done and take over everything—and how long it has taken to get those projects off the ground. There was a huge hiccup resulting from local anger about the way in which the powers were being given to the corporations.

We have touched on the first major unresolved situation—the extent to which the Government, through the agency, are prepared to put their money where their mouth is to achieve their overall objectives over the years, or whether local authorities, generally of a different political persuasion, will stand firm and say, “We are entitled to do within our own area what we believe our local people want”. There will be a dichotomy.

We are all experienced people who have been in local and national politics for many years. When I was the leader of the London Borough of Enfield in the 1960s, as leader of the Labour council and as chairman of housing I received a visit from two people—one was Bob Mellish, the Minister for Housing, the other was Evelyn Dennington, who was chairman of the housing committee of the GLC. They set us an objective in Enfield of building 1,000 housing units—an unheard of figure—but this target was achieved two years after we left office. The change was in 1968 but the plans and the finance were there for completion in 1970.

No one can dispute the object of the HCA to,

“improve the supply and quality of housing in England”,

but it is not what you do it is the way that you do it, who you do it with, who gets the credit and who picks up the bill. All these things have got to be sorted out. I have come into this Committee anxious that, at the end of the day, there should be a workable Bill. We will not agree on every aspect but, for the first time in many years, there is an attempt to get a strategy that works between central and local government. If it does not work and there is a war or a battle, no one wins.

The Minister and her colleagues are entitled to have ambition, incentive and inspiration, but that needs to be tempered with political reality. They need to understand that you can go only so far. We have not yet come across the nimby syndrome, but it is there.

When colleagues, noble Lords on the Benches opposite and I debated the Greater London Authority Bill, we came across shocking instances of the extent to which affordable housing was being provided in some of the richest boroughs in London. The boroughs were exercising their right and took the view that, as far as they and their people were concerned, it was not their priority to build affordable houses. I hope the Minister will tell us that that is one of the priorities over the next period. There will be resistance but I hope that the record of the agency, as it grows in stature, will show to the people of an area that we are on their side and their council is not.

A Member of the Committee has said that if a council does not achieve what the local people desire and wrongly defines what they want, it will be thrown out. It is the same for the Government and for the authority that we are establishing. If it is seen in time—the great mystery is how long we will have to demonstrate its usefulness—to make sensible decisions, wield influence and have people who are respected and authorised speak on its behalf, I have great hopes for it. But I do not underestimate the damage that can be done, and no doubt will be done, in the nexus between local and central government. However, the Government are entitled to get what is set out in their pre-publicity and in the Bill, and I wish it well.

It has been a thoughtful debate on important topics that, in part, anticipate later debates on the designation powers of the Secretary of State. It is worth anticipating some of those issues briefly as we explore the implications of the amendment. The noble Lord, Lord Dixon-Smith, was completely disarming and his language was clearly reflected back to him. I wondered when my noble friend Lord Howarth was speaking whether I had been too kind to him on his previous amendment; however, I will forgive him because he raised very important issues.

The noble Lord said that he wanted to make it plain in the Bill that we were very much on the side of local authorities and that we understood that everything was going to happen within the planning system. I know that he knows that it belongs within the planning system. He quoted me at some length—I must have gone on for hours if that was typical—and said that the Bill disregarded its context and planning powers and that, without something being expressed in it, they might be overlooked. The same goes for the nature of the partnership with local authorities.

I cannot agree with the noble Lord. I must build on my statements at Second Reading in regard to the spirit of partnership with local authorities in the planning system and the practicalities of what we want to achieve. There is no way that we can do any of this without partnership with local authorities and without observing the explicit and transparent rules of the planning system.

My noble friend spoke about housing and the challenge of meeting the housing targets. We already have a system which is responsive to what local communities need. We have planned through our existing system—through the growth areas and the work of EP and much else—hundreds of thousands of houses which are already in development. Our housing need and numbers are determined by the local authorities’ assessment. That in turn is fed through the regional strategies, the regional spatial strategies and the regional housing boards, so that everyone knows not only the current needs but also, with information from the latest ONS statistics and the National Housing and Planning Advice Unit, the future needs as well. There is no way in which the Government could impose those numbers on local authorities. They reflect the genuine nature, the demography and the aspirations of our communities. That is already a robust partnership which requires that we understand and respond to what local authorities face. That is the reality in which the HCA will work, a reality about which my noble friend Lady Ford spoke when talking of the negotiation in Basildon.

Nor does the Bill in any way enable the HCA to circumvent any part of the planning system. It belongs in the planning system and has to observe it. Therefore, I believe that putting into the Bill the fact that the HCA must work within the planning system is redundant because there is no way in which it will be exempt. Once we put that sort of thing into the Bill, we should answer whether we should specify all the other legal requirements to which it must adhere.

The noble Lord, Lord Greaves, raised the issue of designation powers in relation to eco-towns. We know that the designation powers were a very rare event indeed with English Partnerships. They were exercised in that instance, and they would be in other instances; for example, in the rare circumstances of a very large regeneration project which crossed local authority boundaries, where there were specific barriers and difficulties and which was very challenging in terms of regeneration. In the unlikely event that the Secretary of State designates an area and confers responsibility for preparing and maintaining all or part of the local development framework for the designated area on the HCA, there is no way in which it would work outside the planning system. It is firmly in the planning system, with all the appeals processes, with consultation and with examination in public. Planning permission will have to be applied for. There is no way in which the designation powers would be used for eco-towns but the process for eco-towns would be within the planning system.

More important than putting this on the face of the Bill is to ensure that the culture and the organisation of the HCA recognises the realities—I know it will—which are rooted in the strategic responsibility of housing authorities, in the role of regional spatial partnerships and strategies and in the knowledge that, unless partnership is true and transparent, it will simply not get off the ground in relation to any of its ambitions. We have the history and the record to prove that. For example, if you take the growth areas, we know how effective partnership working can be in delivering housing regeneration. For example, in north Northamptonshire, the local authorities of Corby, East Northants, Kettering and Wellingborough came together to form a joint planning committee. They worked together on the delivery of the core spatial strategy and the joint proposals for planning obligations. It is those sorts of partnerships that we want to cherish and encourage. That is rooted in local ambition and capacity.

However, the HCA lives in the real world and it has to acknowledge that the housing markets do not divide along regional lines, let alone local lines. It has to be able to make the local and regional connection—that tripartite relationship which will make things coherent and manageable. It will have a more coherent regional presence; it will have a presence in government offices; it will be closer to local communities; and it will be more able to support local authorities. It will also be able to draw on the things that connect directly to communities. English Partnerships had a very fine record of being able to work with communities, particularly through the housing market renewal pathfinders. The HCA will certainly want to draw on that kind of experience and benefit from it. I do not believe that any of that can be captured, or is needed, in the Bill. That is the reality of how the HCA will work.

Another problem with the amendment is that there may be circumstances in which the agency does not want to work primarily or only with these groups and it would prevent it working without them. For example, if there was a specific project or task that did not interest the local authority or other agencies, the agency would not be able to work unless it could get that co-operation and there might be very good reasons why the local authority was not particularly interested. The amendment reduces flexibility. There is also the possibility that its wording might place the HCA under an obligation to work in partnership with every other agency already involved in work related to the pursuit of its objects, however tangential. I am appealing for flexibility and trust on the record of achievement, the well established ways of working and what the HCA will have to do in order to meet the challenge. In his amendment, the noble Lord, Lord Greaves, probed further into the nature of that relationship. I have talked a bit about the role in relation to designation, and we shall have a longer debate when we come to that.

The agency will be the best delivery partner of local authorities. For the first time, local authorities will be able to go to one place that can: assemble land and investment; look at complex situations to see what is possible; broker and lever arrangements, finance and investment in a way that the combination of the Housing Corporation and EP could not; bring the skills in; bring the market intelligence in; bring in all the things that enable people to have a clear picture of what is possible; and then get behind them with the resources. It will be a one-stop shop. That is a real partnership, and that is why local authorities and the Local Government Association are so positive about how the HCA will help them to provide the homes that are needed in their communities.

Far from being top-down, leviathan, a behemoth or any of the words that are along the lines of monster, this will be a responsive and transparent agency that will serve local government extremely well. When I look at the noble Lord’s amendments that refer within the same context to different bits of the operation—for example, his amendment that deals with housing targets—each of them does something that will damage the flexibility of the HCA and inhibit it achieving its option. For example, if we take the target relating to housing, his amendment is damaging because there may be circumstances in which we would wish the HCA to provide housing directly or to repair and improve housing. One of those programmes is the decent homes programme, which the agency will take over. That is designed to deliver our commitment that 95 per cent of social rented stock will be made decent by the end of 2012. That is an extremely important commitment, and we have spent £23 billion so far on making 1 million non-decent homes decent. That could not happen if the noble Lord’s amendment were carried because it would stop the HCA acting directly. It would disable the HCA in that respect. I could go on in relation to infrastructure and regeneration because it is again very important that the HCA can act directly, but I think I have made my point. I hope that I have answered most of the questions about the implications raised by the amendment and that the noble Lord will be able to withdraw it.

Before the noble Lord replies, the Minister said a lot of interesting things. Given the time this evening, some of them can be put on one side because they will come out later as we go through the Bill. To pick up the last point, my amendments are not intended to stop the HCA doing these things, but would ensure that they would be done only in exceptional circumstances and if the Secretary of State agreed. I am not talking about housing targets at all. I do not envisage—perhaps this is something we can pick up later—the HCA itself providing large quantities of housing and becoming a landlord. Surely, the HCA will be working either through local authorities or registered providers, as we must learn to call them in future—RSLs and so forth. The last point made by the Minister was not what I intended by the amendments, which were designed to be probing. The Minister said some interesting things about the presence in the regions, but we can pick those up later on.

The fundamental point is the question of assurances. The noble Lord, Lord Howarth, and the noble Baroness, Lady Ford, said that they had complete confidence in the Minister, the Secretary of State, Sir Bob Kerslake and everyone else involved. It may be that the Secretary of State, the Minister and Sir Bob Kerslake are all thoroughly good eggs and will agree with this, but the idea is that assurances can be given in a short-term ad hominem way and we are legislating for whoever may be in power in five or 10 years’ time. We need to look beyond the individuals concerned at the moment, who we may all have total faith in. Who knows who might be there in the future? Things might be different and people might have different attitudes. It is just possible—I would not put it further than that—that the present Government may lose the next general election and then who knows what catastrophe might descend on the country? Perhaps that will never happen—who knows? Perhaps the Liberal Democrats will take over and everything will be full of roses and sunsets for ever—or not; we shall see.

Lots of issues have been raised. The debate has been extremely useful and the Conservatives, ourselves and others may want to see a more robust amendment that does what we are looking for at a later stage, but we can discuss that later.

I shall confine myself to Amendment No. 13—the one that I proposed—in winding up this discussion. I am very grateful to all those who supported the sentiment of my amendment if not absolutely every word. The noble Lord, Lord Best, summed it up extremely well. Is he still here? He was hiding behind the noble Lord, Lord Greaves, so I could not see him for a moment. In one sentence he said that it would send a powerful signal to local government throughout the country if we put something like this in the Bill.

In winding up, the Minister did not disappoint or indeed surprise me. She would have surprised me if she had done what I suggested and said “yes”. I might have had a heart attack and spared everyone a lot of further trouble if that had happened. However, she is asking for more. In a way, I was slightly sorry that she did not offer to pick up the baton and see whether she could find a form of words that achieved what everyone appeared to wish to do. We will have another shot to see if we can come up with something a little less restrictive.

When she argued that the agency might occasionally want to go outside what I would call the box of co-operation, it occurred to me that that might be a good thing, but there might also be good reasons why it should not, which is a very two-sided argument. We do not want to get into that at the moment.

The noble Lord, Lord Graham, who has left, mentioned quite rightly the dichotomy between local and national government. He knows as well as I do how tense and intense that can be. It will always be there. It is what I call dynamic tension and it works extremely well for national government and local government. If it did not exist and all were sweetness and light, I guess that we would make very little progress. This is an important issue. I am grateful for the psychological support for what I intended to be a psychological amendment, but, for now, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Much as I would like to discuss the objects and objectives of the next amendment, this might be a convenient moment for the Committee to adjourn until Monday at 3.30pm.