House of Lords
Tuesday, 9 February 2016.
Prayers—read by the Lord Bishop of Chester.
Retirement of a Member: Lord Dixon
My Lords, I should like to notify the House of the retirement, with effect from today, of the noble Lord, Lord Dixon, pursuant to Section 1 of the House of Lords Reform Act 2014. On behalf of the House, I should like to thank the noble Lord for his much-valued service to the House.
Oil and Gas: UK Continental Shelf
My Lords, during his visit to Aberdeen on 28 January, my right honourable friend the Prime Minister set out an action plan to help build a bridge to the future for the industry. This includes a £20 million package of new investment in exploration, innovation and skills, and a new oil and gas ambassador.
My Lords, the oil and gas industry is probably facing its worst ever crisis since it was established more than 60 years ago. Will the Government now scrap the supplementary charge and will they clarify the liabilities on decommissioning which might help that to proceed? This industry has provided tens of billions of pounds worth of investment and hundreds of thousands of jobs for many decades. Will the Government ensure that their action plan will enable it to do so for many decades into the future?
My Lords, it is true that representations have been made on the fiscal front and the Chancellor will be considering those. We must recognise that it is not all doom and gloom. Bob Dudley, the chief executive of BP, said last month that the North Sea remained viable economically and would be for decades to come.
My Lords, is it not quite obvious by now that Scotland and the oil industry have benefited enormously from having the strength of the United Kingdom around them? Had the Scottish people voted for independence, they would not have been able to benefit from the wider resources of the United Kingdom and the Prime Minister’s welcome involvement in supporting the oil industry in the north-east of Scotland.
My Lords, Scotland has its very own carbon crisis. The Minister mentioned a supplementary tax. That was imposed in the 2011 Budget and increased from 20% to 32% on the basis that oil prices had doubled. They have now crashed from $114 a barrel—happy days for the SNP—to less than $30 a barrel. There must be a compelling case for scrapping that supplementary tax in its entirety and engaging once again with Sir Ian Wood and others to ensure that, in a bleak global environment, there is at least some viable future for the North Sea oil industry.
My Lords, the noble Lord is right that the fall in oil prices is an international problem. He will be aware that there was fiscal reform in the 2015 Budget, with a £1.3 billion injection of extra help over five years through tax cuts. As I have said, the Chancellor will look at representations that have been made to him.
My Lords, the package that the Prime Minister announced on 28 January includes £20 million of new investment in seismic exploration. This will be of assistance, together with the City Deal package for Aberdeen which includes a new innovation energy centre. I hope that the noble Lord will welcome it.
Will my noble friend please bear in mind that although this is a major problem for the north-east of Scotland and the Grampian area in particular, the oil and gas industry and exploration on the continental shelf have generated much wealth for the whole of this country, and therefore tackling the particular issues of the continental shelf will benefit large parts of the nation’s economy?
My Lords, my noble friend is absolutely right about the benefits to the whole of the United Kingdom from oil and gas exploration. He will be aware that two massive new fields to the west of Shetland were opened today by Total in Laggan and Tormore, which is very good news.
My Lords, when Sir Ian Wood published his recommendations two years ago, oil was indeed trading at a much higher price than it is today, with the price now dipping to below $30 a barrel. Will the Minister inform the House what effect the Government think this has had on the strength of the recommendation of the Wood review report?
My Lords, the noble Lord will be aware that the Government have given high priority to ensuring that the recommendations of the Wood report are taken through into law. That is now happening through the Energy Bill, as the noble Lord is aware, so I think that indicates our clear commitment. He is absolutely right; this is a global problem but we are doing what we can domestically to ensure that the UK industry has all the support necessary.
My Lords, as I well recall from my time as Energy Secretary, the North Sea oil and gas has had a glorious past. However, is it not clear that its future can be only a shadow of what it has been, and that the future of our indigenous oil and gas industry must lie in the exploitation of our shale resources, which are quite substantial? Will my noble friend undertake to go ahead with that as fast as he possibly can?
My Lords, I am very much aware that my noble friend has a very distinguished record as a former Energy Secretary. However, I do not think it is true to say that the oil industry is entering a period where its significance is diminished. It is perhaps not what it was, but it is still of enormous importance. The two oil fields to which I referred will be able, when at maximum production, to supply energy to 2 million homes. However, he is absolutely right about the importance of shale and the Government are determined to go ahead with exploration for it.
My Lords, will the Minister comment on the reports in today’s press that the Chancellor is expected to raise taxes on the oil industry at a time when consumers are not really seeing a reduction in price at the petrol pumps? Will he disabuse us of that idea?
My Lords, the noble Lord is right to raise the importance of the Laggan and Tormore fields. They will be there for a substantial period. I am not sure about the precise period but, as I say, it is a massive find. The greatest part of the energy fields yet unexplored remain to the west of the Shetland Islands and are of massive importance to the country.
My Lords, I declare an interest as a Lancashire resident. Will the Minister care to take away and reflect on the fact that there is great concern and anger at government suggestions that local people should be taken out of the decision-making process for future fracking? Will he care to comment on the fact that all the fracking decisions this Government have taken tend towards the north? Does he envisage any fracking taking place for oil or gas in the south of England, where Conservative support is concentrated?
My Lords, the noble Baroness will be aware that decisions on fracking are taken by planning authorities; they are not a matter for the Government. She will be aware that there are potential fracking areas throughout the country. That, of course, will be something that planning authorities will take forward.
To ask Her Majesty’s Government whether they will provide further information on their proposals for renewal or replacement of failed housing estates, following the announcement by the Prime Minister of £140 million funding; and whether any additional funding will be made available.
My Lords, estate regeneration provides a big opportunity to turn around run-down, low-density public sector estates to produce many more new homes and to tackle blight. The funding announced is only part of the package we are working on. An advisory panel, co-chaired by my noble friend Lord Heseltine and my honourable friend Brandon Lewis, will explore how we can help the projects to go forward. The panel will meet for the first time today.
I thank the Minister for her response. I am sure she is aware that, in many parts of the country, the number of households in severe housing need is rapidly rising. Indeed, it is 3,000 in my own city, with the numbers of people sleeping rough having gone up by 41%. Will the noble Baroness tell me when precise, funded proposals will be published, and can she assure us that decent, affordable homes will be provided for those families in the most severe need?
The noble Baroness underlines the reason why we are doing this estate regeneration. The Government have an ambition to introduce more than 1 million new homes into this country by 2021. The funding that was announced was purely seed funding to attract other forms of funding both in the public and the private sector. In terms of the mix of tenure, that will certainly be in the panel’s minds as it makes its considerations going forward.
My Lords, does my noble friend agree that one of the ways to make homes affordable is to ensure that they are energy efficient, so that people do not have to pay too much for their heating? Will she assure the House that these homes will not be built so energy inefficiently that they have to be dealt with again within 20 years? Can she assure the House that energy efficiency will be high on her list of priorities?
My Lords, I will not be sitting on the panel, but I shall certainly bring that point to my noble friend Lord Heseltine. Of course, my noble friend is absolutely right that, the more energy efficient a house is, the cheaper it is to live in and the cheaper the bills are for the tenants or the owners of it. I will certainly bring that point to my noble friend’s attention.
My Lords, the House is calling for a Cross-Bencher so we must go to the Cross Bench first.
My Lords, does the Minister accept that, when making large-scale policy changes on social housing or in implementing estate regeneration programmes, tenants desperately need access to information, advice and advocacy about their rights and options, on the implications for them and their families? Will she ensure that strategies for supporting housing and social welfare advice, commonly provided by such organisations as Shelter, citizens advice bureaux and law centres, are factored into the funding and effective structures for delivery?
The noble Lord makes a very important point on the need for those tenants not to feel that this has been imposed on them or that things have been done to them, but that they are very much part of the process that is taking place. I know that that is foremost in the mind of my noble friend Lord Heseltine. It will be a collaborative process with tenants to do the best for them.
The Minister’s right honourable friend the Prime Minister, when he announced this initiative, talked about bulldozing 100 sink estates. Can the noble Baroness tell us how many families will be living in those sink estates and how far the £140 million will go towards providing them with adequate accommodation? Perhaps she can tell us whether she agrees with the Prime Minister’s terminology in describing those homes as being in sink estates.
My Lords, “sink estate” is terminology that conjures up a picture of an estate that has become run-down, in which people feel less safe to live or, indeed, where the standard of accommodation is not what it should be. The £140 million of funding is seed funding for other types of funding to come in both from the public and the private sector. While that regeneration is being done, I do not expect that the tenants will be living in those houses.
My Lords, I speak as one who lived on one of these estates for some 10 years in the 1980s and 1990s at a time when significant public money was invested in that estate. My memory, looking back with the benefit of hindsight, is that we probably gave relatively too much attention to physical investment and not enough to investment in other kinds of infrastructure. Will the Minister assure me that, while attention is given to the physical fabric, whether that is new or renewed, equal attention—maybe even over and above the £140 million, or another £140 million—will be given to such matters as educational, social and economic infrastructure?
The right reverend Prelate makes a really good point about regeneration being about not just the physical structures that are in place but some of the social structures that are in place to support communities, and other amenities, as he said, such as schools, hospitals and GP surgeries, that so often are not thought about when we think about regeneration.
My Lords, I declare an interest as a councillor in Lewisham. The Government issued an Estate Regeneration Programme prospectus in 2014 that promised a £150 million fund from 2015-16 onwards, with all the funds being drawn down by March 2019. The PM recently announced a £140 million fund for estate regeneration. Will the Minister confirm that these are not the same funds being announced twice?
Walking and Cycling
My Lords, the Government have made clear their intention to make this country a cycling nation and are committed to producing a cycling and walking investment strategy setting out our objectives, activities and funding available for cycling and walking in England in the long term. The strategy will be published in the summer and will include details of how the £300 million committed in the recent spending review will be invested to support both cycling and walking.
My Lords, from April 2016 the Government have reduced the revenue funding for local authority cycling and walking safety training from £78 million a year to £20 million a year. That will inevitably lead to a reduction in the number of trainers available for schoolchildren and adults. Given that the Department of Health is having to put together a strategy to combat the epidemic of obesity in adolescents, does the Minister not believe that this is a false economy?
Over the past five years the spending on cycling per person in England has actually gone from £2 per person to £6 per person. If we look at the priority cities, £10 is being spent on each individual. The noble Baroness talked about safety. The Government are investing a further £50 million in the excellent Bikeability scheme, which ensures that our next generation of cyclists are avid cyclists but also learn the importance of safety in cycling.
My Lords, in the recently published new strategy for sport, the Minister for Sport said that the DCMS is not the only department that should be concerned about supporting the health of the nation; 10 other government departments were mentioned in that strategy but, interestingly, not the Department for Transport. I wonder if my noble friend the Minister could—not get on his bike but get involved and speak to all those various departments to see if there can be joined-up government to help such an important facet of our nation’s health.
My Lords, does the Minister appreciate that the Forestry Commission provides not only many trees for this country and much timber but thousands upon thousands of miles of forests for the citizens of this country to walk and cycle in, and that there has been a repositioning of the forests much more into the urban areas? For example, when I was chairman, we planted more than 4 million trees in south Lancashire alone. Will the Minister give us an assurance that the Forestry Commission will be considered for some money out of the £300 million pot that is expected in the summer?
I cannot give a specific commitment on how that £300 million will be allocated; that has yet to be decided. If, however, the Forestry Commission would like to make to make a representation I would be delighted to meet with it to discuss its plans further.
My Lords, the Minister referred to safety training for children, but they also need safe walking and cycling routes to schools, because that is a key way of encouraging them not just to walk or to cycle but to scoot to school. Do the Government intend to introduce safe routes for walking and cycling to all schools, rather than having them just as a desirable optional extra?
We already see very good examples of our local authorities and schools adopting excellent schemes. As a father of three children, I can assure noble Lords that local schools are very diligent in supporting both walking and cycling; that practice is widespread across the country.
May I make a minority point? Counties such as Lincolnshire have many disused railways, which provide a real opportunity for creating tracks to be shared by walkers, cyclists and riders on horseback. There is, however, a problem with the tarmac that is being put down: it is splendid for bicycles, okay for walkers but very, very bad for riders on horseback. Will the Minister, therefore, encourage the use of a material other than tarmac for these shared tracks?
As a resident of Wimbledon, I see many examples of shared facilities, and they are a good thing. I assure the House that I am very familiar with the shared use of tracks for bicycles, walking and, indeed, horses. However, my noble friend makes an important point and I will take it back for consideration.
The Government have said that they will reduce the number of pedestrian and cyclist fatalities each year. What is the Government’s minimum target figure for the reduction of pedestrian and cyclist fatalities each year, and how much are they planning to spend each year on cycling safety as opposed to general road safety?
Any responsible government will have the aim of ultimately reducing the deaths of cyclists to zero. Any cyclist’s death is one too many. The number of deaths currently stands at 113; the number of serious injuries, however, is far higher. The noble Lord makes an important point about the education of cyclists, and therefore—as I have already said—the Government support schemes such as Bikeability very strongly.
Does the Minister remember that a year ago I was in training for Walk4Jack, in support of my desperately injured neighbour Jack, who had tragically broken his neck in a rugby accident? I hope that he remembers it, because he gave me a nice cheque for it. Indeed, almost 200 Members of this House supported Walk4Jack. Is it an appropriate moment for me to inform the House that, partly because of the support available here, Jack is now putting the threads of his life back together: still tragically injured but going back to work? Does the Minister agree that this is a wonderful example of the benefits of walking—which include my loss of a stone and a half—and also of the depths of generosity of this House, for which I am grateful from the bottom of my heart?
My Lords, when my noble friend started speaking I thought that he might be reminding me—I was racking my brains as to whether I had paid the cheque. I am glad for the accuracy of Hansard, which proves that to be the case. I join him—as I am sure all Members will—in welcoming the rapid recovery of his friend. Sometimes this House comes under great scrutiny, and at times criticism, but it is an excellent example of the best of British, and I too want to put on record the immense generosity of this House in supporting such schemes.
My Lords, the European Parliament and the Parliamentary Assembly of the Council of Europe are right to condemn Daesh abuses in the Middle East and its treatment of minorities. It is a long-standing government policy that any judgments on whether genocide has occurred are a matter for the international judicial system, rather than Governments or other non-judicial bodies. However, let me reassure noble Lords of the Government’s commitment to defeating Daesh and preventing further abuses.
My Lords, what is the point of Britain being a signatory to the 1948 genocide convention if, when compelling evidence emerges of mass graves, systematic executions, abduction, rape, enslavement and the forced conversion of minorities such as Yazidis and Christians—evidence sufficient to convince the European Parliament and the Council of Europe—the United Kingdom declines to name this horrific cruelty for the genocide that it is? Do we intend to ignore these resolutions, or will we take them to the Security Council and seek a referral to the International Criminal Court or a regional tribunal, so that those responsible for these heinous crimes will one day be brought to justice?
The noble Lord, Lord Alton, describes these crimes quite rightly as heinous. He also suggested that we take this matter to the UN Security Council, but it would be for the Security Council as a whole to agree. The UN Security Council has already taken a number of steps against Daesh, for example the binding resolutions against it which seek to reduce its ability to finance its activities and cut the flow of foreign fighters. However, whether or not this is ever designated as genocide does not stop this country’s determination to deliver aid to those people in that situation.
My Lords, some of us are really puzzled as to the slowness of the labelling as genocide of Daesh activities, whether by a stronger push from London or in the United Nations. Does my noble friend accept that we are dealing here with a movement of undiluted evil? As the noble Lord, Lord Alton, has reminded us, there have been beheadings, crucifixions, burnings alive, raping and the killing off of the entire Yazidi community. Its sister franchise in west Africa is even reported to be burning children alive. If this does not take us to the definition of genocide in its present form, and I realise that we have to be careful with the words, then surely there must be something wrong with the convention and the international bureaucracy that decrees these things. Can more urgency be put into a matter where it is plain fact that we are dealing with one of the most evil movements of the world, which should be destroyed?
My Lords, once again my noble friend describes the dreadful activities taking place. Perhaps I could add a reference to a letter that was written to the noble Lord, Lord Alton, by the Prime Minister. I offer my apologies for how late it was in getting him a reply. My right honourable friend the Prime Minister repeated that it is a long-standing government policy that any judgment as to whether or not genocide has occurred is a matter to be judged by the international judicial system. We will nevertheless, of course, continue to fight to bring an end to Daesh’s campaign of terror.
My Lords, I share the general confusion as to the Government’s position on this. Do they think that genocide is an inappropriate word to ascribe to the activities of Daesh in the Middle East, or do they think that, although significant and accurate, it is better to keep quiet about it in the interests of some greater good, which I must confess for the moment eludes me?
On the contrary, my Lords, we are not keeping quiet about this issue at all. Only last week, we had 33 Heads of State and 60 different organisations across the road in the QEII Centre, where we had the Syria conference. At that conference, more than $11 billion was committed to spending in Syria. This is not sitting back and doing nothing.
My Lords, when a few months ago I asked for government support for an international inquiry into supposed genocide against the Sikh community in India, I was told, in a very short reply, that it was solely a matter for the Indian Government. That was not a very Christian sentiment. Would the Minister agree with the sentiments of the Sikh guru who gave his life defending the right of followers of another religion to worship in the manner of their choice? Human rights abuses against anyone are the responsibility of us all, and the Government should take every measure to bring those guilty of them to justice.
Transport for London Bill [HL]
Motion to Consider
That the Commons message of 17 November 2015 be now considered; and that the promoters of the Transport for London Bill [HL], which was originally introduced in this House in Session 2010-12 on 24 January 2011, should have leave to proceed with the Bill in the current Session according to the provisions of Private Business Standing Order 150B (Revival of bills).
Welfare Reform and Work Bill
Relevant documents: 13th, 19th and 20th Reports from the Delegated Powers Committee
Clause 8: Benefit cap
1: Clause 8, page 9, leave out lines 28 and 29
My Lords, I will first speak to Amendments 1 and 2, which seek to pave the way for the introduction of an exemption from the benefit cap for all households where a member receives carer’s allowance or guardian’s allowance. We will bring forward regulations to give effect to these exemptions later this year. The exemption will mean that households where someone receives carer’s allowance or guardian’s allowance will be exempt from the cap. For carer’s allowance, this means that the claimant’s household will be exempt from the effect of the cap regardless of whether the cared-for person is part of that household or not.
Providing an exemption from the cap where a member of the household receives carer’s allowance fits within the wider government strategy to do more to support and invest in carers. Both carers and carers’ organisations have welcomed this change, with Carers UK, one of many organisations that work tirelessly to support the needs of carers, describing it as “fantastic news”.
Following the eloquent arguments on guardian’s allowance put forward by the noble Baroness, Lady Hollis, on 25 January, I said during the debate on Report on 27 January that this was an issue I wanted to explore further. Having considered the issue carefully, I can now confirm that we intend to exempt all households in receipt of guardian’s allowance from the benefit cap.
Guardian’s allowance is paid to someone who is bringing up a child whose parents have died, or in cases where one parent has died and the other parent cannot look after the child, for example where the other parent is untraceable, unknown or serving a long prison term. As noble Lords will appreciate, this is a very difficult time both for the guardian and for their family, who are not only dealing with their own grief over the loss of a family member or friend, but also helping a bereaved and possibly distressed child come to terms with their loss while settling them into a new family home.
By tabling this amendment we are leading the way for the introduction of an exemption, and we will bring forward regulations to give effect to that later this year. An exemption from the cap emphasises that the Government both recognise the difficult circumstances these families face and strongly value the role of guardians in enabling vulnerable and bereaved children to continue living with their relatives or close family friends.
Amendment 3, as I explained on Report on 25 January, was tabled in response to a recommendation by the Delegated Powers and Regulatory Reform Committee that regulations made under the powers introduced by Clauses 8 and 9 should be submitted to the Social Security Advisory Committee for consideration. We have decided to accept the committee’s recommendation in part.
During the debate on 25 January, the noble Baroness, Lady Sherlock, asked for a clarification of what regulations might be available to be sent to SSAC, as well as an explanation of why the Government do not think that the level of the cap should be referred to SSAC. I will explain that now. But before I do, I should like to put on record the fact that the Government greatly value the role that SSAC undertakes in providing impartial advice on social security and related matters. This is why consultation with SSAC may extend to cover regulations relating to the key features of the benefit cap policy. For example, we would discuss with SSAC any proposed changes to the grace period or exemption criteria, the introduction of new disregards, or changes to which level of the cap applies to the different household types.
Regulations relating solely to changes in the level of the cap are not included in this amendment. Changes in the level of the cap require a broad assessment of the most significant long-term developments and trends that might affect our economy and are important to households up and down the country. Factors such as inflation, benefit rates, the strength of the labour market, and any other matters that may be crucial and relevant at that time, need to be considered. This is why we have maintained throughout that it is important to allow the Secretary of State the ability to consider the context of the cap in a broad and balanced way. Maintaining this approach means that the Government can respond quickly in the light of any significant economic events that occur unexpectedly but will have long-term consequences for the national economy, and can take steps to adjust the cap level accordingly.
Equally importantly, let us not forget that any changes to the level of the cap are subject to the affirmative procedure, as agreed on Report on 25 January, when government amendments to that effect were accepted. So noble Lords will have the opportunity to ask the Government to explain any changes in the level of the cap before voting to accept those changes. I believe this approach substantially addresses the committee’s recommendation, but also enables the Secretary of State to respond to economic circumstances by considering a broad range of factors when considering the cap level.
Amendment 4 is a consequence of Amendment 3. Its purpose is to make clear that the new clause inserted by Amendment 3, which brings regulations under the benefit cap provisions within the remit of SSAC, extends to England and Wales, and Scotland.
As we draw to the end of debate on the benefit cap clauses, may I take this opportunity not just to thank noble Lords for their contributions on this subject, but to focus on the fact that they have helped to ensure that the work incentive principles of the cap are fairly balanced with that of protecting the most vulnerable. We will bring forward new exemptions for those in receipt of carer’s allowance and guardian’s allowance, and, as I have said, we have increased the level of parliamentary scrutiny by extending the affirmative provisions for any change to the cap level in the future.
Subject to the will of Parliament, the department will now press on with implementing these changes, and will continue to work closely with local authority partners. In spring, after Royal Assent, we will notify households that may be capped at the lower level and advise them of the support available to move into employment, as well as budgeting and housing support that they can access. This will give households several months to take up any support they might need and prepare for the new cap coming in from the autumn. I beg to move.
My Lords, when the Minister made this welcome concession about carers on Amendments 1 and 2 on Report—it is indeed fantastic news—I promised no more vituperation, and there will be none. I just have a couple of points on which I would like clarification.
To exempt carers in receipt of carer’s allowance from the benefits cap, the Government will need to amend not only the Bill but the housing benefit and universal credit regulations. Can the Minister confirm that that is what the Government intend to do? I also want to refer to carers who have an underlying entitlement to carer’s allowance. The Minister has announced that all carers in receipt of carer’s allowance will be exempted from the benefits cap. Although that covers the majority of carers, a small number of working-age carers have an underlying entitlement to carer’s allowance but do not receive the payments because they are already in receipt of another income-replacement benefit. That means that carers who have an underlying entitlement to carer’s allowance but are in receipt of benefits—such as jobseeker’s allowance, employment support allowance, maternity allowance and so on—may still be affected by the cap. I should like the Minister’s assurance that he intends this to apply to all carers. If he is unable to give me that assurance now, perhaps he could write to me.
I end by thanking the Minister again for this extremely welcome concession and recognition of all that carers do for the nation, and offer the support of the carers’ organisations in getting the information out there. Anything that can be done to help the Government convey that news will be done.
My Lords, I, too, thank the Minister. I am truly grateful that he has responded in such a compassionate and sympathetic way to the situation of people who are at the hardest edge of kinship care, when bereaved family members are seeking to look after bereaved children. What the Government, and the Minister in particular, have done is remove an additional pressure that we would have been putting on them of financial strain. As I understand it, he has confirmed that not only will such families be exempt from the benefit cap, the entire income, not just the guardian’s allowance, will not come under the benefits cap—in other words, as a group, they will be excluded. That is so important for those families to give the children they are caring for—as well as their own children, perhaps—the stability and security they need if, out of the wreckage of their lives and the damage that has been done to them, they can hope to build a secure future. I am very grateful to the Minister and thank him enormously.
I add my thanks from these Benches. It is great and really welcome. To have these two allowances removed from the benefits cap is essential. We have had long debates and this was pointed out very clearly and forcefully by the noble Baroness, Lady Hollis. We on these Benches are really grateful.
Of course, I remain concerned about other areas, such as the additional children of women who are fleeing domestic violence. I implore the Minister to look again at that issue, and perhaps we could come back to it, so that those women, or indeed partners, could be exempted from the two-child tax credit limit.
My Lords, without wanting to detain the House, I add on behalf of this Bench our thanks to the Minister and offer our support and gratitude for the amendments he has brought forward today. The concerns that have been expressed around the House on many occasions for those who are most vulnerable in society have been passionate and heartfelt. It is good and reassuring when they are heard, and we offer our thanks as well.
My Lords, I add my note of congratulation to the noble Baronesses, Lady Pitkeathley, Lady Hollis and Lady Drake, on the splendid work that they have done not just on this Bill but long before and since. They deserve the credit for these hard-fought and well-won amendments, as does the Minister. This has not been an easy Bill at all. Indeed, I do not want to spoil the tone but I join the noble Lord, Lord McKenzie, in saying that this is the worst Bill that I have ever come across in 35 years of working in social security. This group of amendments is extremely welcome, but taking £12 billion out of the social security system for the rest of this Parliament is going to continue to be a hard-fought business at all levels, particularly in this House.
I congratulate the Social Security Advisory Committee, whose work is exemplary; it supports a lot of the work that many of us in this House do. I also congratulate the Delegated Powers and Regulatory Reform Committee, which was absolutely correct in its 13th report when it strove to draw to the Government’s attention the fact that the SSAC needed to have a role in these clauses. I agree with that, and now we have a compromise. I do not understand why the Government decided not to allow the whole of the DPRRC’s recommendation; it would not amount to much, and keeping the level out of the hands of the SSAC just encourages Treasury Ministers to say daft things after Budget purdah without any consultation or anticipation by anyone—there have been examples of that in the recent past.
It also detracts from the established annual procedure for updating the social security levels that Parliament has always had in the uprating statement. I note, for example, that there is no sign of the uprating statement coming to your Lordships’ House this year; it is being done by the other place. I look forward to the powers that be allowing at least a Moses Room debate because it is the one occasion when you can look at the national insurance accounts, the Government Actuary’s recommendations and the totality of social security and tax credit expenditure. If this House cannot find time to discuss that annually, that is a matter of very great regret.
My final point is about the SSAC and the policy around the benefit cap. It is one of the most regressive policies that I have ever come across in any social security system, but I understand that I am in a minority of maybe one in the country on that question now. Maybe the Minister will confirm this because I think that the answer to this question is yes: once, as I hope it will be, austerity is dealt with and as a nation we get into a more favourable set of economic circumstances, I believe that the SSAC could use its discretion to undertake a report into the whole policy. I do not think it is excluded by anything in these amendments from looking at the impact and eventual outcome, after the introduction of universal credit. I understand that that may be a few years down the line, but am I right that nothing in the amendments precludes the committee, on cause shown, if it really believes that it needs to make recommendations to the Minister?
I pay tribute to everyone who has been involved in this Bill; it has been one of the hardest fought and most difficult, and people have worked hard on it. We have got results today, and I welcome that as much as anyone. Still, I think that the Bill will cause damage in future, although I know that as long as the noble Lord, Lord Freud, is in his position he will be monitoring that carefully. If he believes in the fullness of his consideration that some of this stuff needs to be amended in future, we rely on him to come to the House and tell us so. I would be one of the first to support him if he did.
My Lords, I join those who have congratulated the Minister on recognising the special needs of this particularly deserving group. I also congratulate those who have brought these matters to his attention. I feel that this demonstrates very clearly that, when a good argument is put forward, it will be listened to.
My Lords, I am sorry that I cannot join totally in the congratulations, although obviously the noble Baronesses, Lady Pitkeathley and Lady Hollis, have achieved great things. However, the noble and learned Baroness, Lady Butler-Sloss, and I were very keen that those adopters of difficult children who join their families should also be excluded from the cap. In his reply, the Minister accepted that, where sibling groups were adopted, that would be an exclusion, but where there was one child, his words were, I think, that they would be not unlike any other family.
I suggest to the Minister that any adopted child is not like any other family. Children in care who are going to be adopted are not sweetness and light on the whole. They have had very difficult childhoods and are going to need extraordinary care. I express my disappointment. We have written to him to say that we are disappointed that adopted children have not been included in the list. Having said that, I am extremely grateful for those who are.
My Lords, I, too, thank the Government for the concessions that they have made, and I share the view expressed by the noble and learned Lord, Lord Mackay of Clashfern, that, on this occasion, when a good argument was mounted, it was listened to. However, I say to the Minister that, if he liked those, I have plenty more where they came from, so I look forward to future useful conversations. I also promise him no vituperation at all. Perhaps he will permit me a mild sulk when I come to the third of his amendments, but I promise to be gentle about it.
I welcome wholeheartedly the decision to exempt all those in receipt in carer’s allowance and also to go a step further and not just to exempt guardian’s allowance, as had been hinted at at a previous stage, but in fact to exempt all households containing someone claiming guardian’s allowance. That is a generous response to the pressure from this House. In particular, I pay tribute to my noble friend Lady Pitkeathley for all the work she has done on carers, of whom she is such a tireless champion, and to my noble friend Lady Drake for emphasising the position of carers of different kinds.
I have certainly raised the question of guardian’s allowance to precisely no effect whatever, but when my noble friend Lady Hollis gave a speech and made a report, the Minister ran the white flag up the flagpole at once, and said, “I now know how to deal in future with matters on which I have good arguments.” I commend him for having listened carefully to that one.
The question on which I am still a little unhappy is related to government Amendment 3, raised by the noble Lord, Lord Kirkwood. As the Minister said, I pushed on this on Report, and I would have brought another amendment back, had I been permitted, but I am afraid the Companion does not allow me to do it. I am glad the Minister has explained why the Government took the view to accept only in part the recommendation made by the Delegated Powers and Regulatory Reform Committee. However, I think it is worth while reminding ourselves that the committee could not have been much stronger. It actually said that it considered it inappropriate,
“for this Bill to confer the highly significant regulation-making powers in Clauses 7 and 8 without the application of the SSAC scrutiny requirement”.
When the Government decided not to accept that in full, that is quite a strong statement. It is worth remembering why. Although the benefit cap is a matter for Parliament, all regulations are a matter for Parliament. All that happens is that they go there via an expert Social Security Advisory Committee which will then give advice to us and to Ministers about the way in which the Government should proceed. The Executive are entirely at liberty to ignore that advice and to press ahead, but they really ought to listen.
The reason that the level of the cap is important is that it is not just a matter for the economy. For example, it would be perfectly possible for a Minister to bring forward regulations saying the cap should be set at £500 a year. I am not suggesting they would, but they could. In doing so, that would render completely pointless the entire array of social security legislation, specifying the entitlement people have to a range of benefits by simply saying, “You may be entitled to all of those—however, anything over £500 we just will not give you”. I am not suggesting the Government would do it, but that is an extraordinarily important power, and therefore a very good reason that the SSAC should have been invited to use its powers in scrutinising it before the Government were able to go ahead and do it. However, all I can do at this point, as I say, is sulk mildly, register my disappointment and urge the Government to go away and think again, because I would not want to break the mood of general congratulation, in which I share.
I take the opportunity to ask the Minister a couple of practical questions. He mentioned that the Government will be bringing regulations back later in the year to legislate for those parts of the concessions that are not covered by the amendments today. He has explained he would do that in relation to the amendments on the benefit cap. Will the Minister also tell the House when and how the Government will legislate to deal with their concessions in relation to the two-child policy for kinship carers and adoptive carers? I understand that the regulations will be subject to the negative procedure. Is that correct? If so, will he commit to publishing draft regulations before anything is laid in Parliament? A lot of debate has gone on and in the light of that debate and, indeed, in the light of the comment that he made on Report to the right reverend Prelate the Bishop of Portsmouth in relation to domestic violence, it would be helpful to the House if he were willing to offer that.
I understand the disappointment of the noble Baroness, Lady Howarth, at not getting a concession for all adopters, but the Minister said that he would exempt people adopting sibling groups that would take the household to over two children from having this policy limiting benefits to the first two children applied to them. May I take this opportunity to ask for some clarification? Obviously that would mean that, if a family had one child and adopted two siblings, the two-child limit would not be applied, even though they then had three children. However, it is not unheard of for a family to adopt children and then, later on, for a sibling to one of the adopted children to need adoptive carers. Social workers will quite often go out deliberately to ask the family whether they would take on that sibling to the adopted child, because that is good both for that child and for the child who has already been adopted. I certainly know of people who have been in that situation. Would those people be exempt from the two-child limit in that circumstance?
The reason why this is important is that these are not people simply making a choice to have another child, whether by adoption or by biology. They are people who are specifically asked to take on that child, as opposed to a child in general. Is the Minister willing to commit that those families at the very least would be exempted from the two-child policy? If he cannot give me a positive answer now, I urge him not to give me a negative one and perhaps to go away and discuss it further with colleagues in other departments, who may be able to offer expert advice on the matter. If he should be minded to offer a positive answer, I urge him to do so now and unequivocally, in a way that is incapable of being revoked at a later date by anyone in the Treasury or elsewhere.
I thank the Minister once again for listening and for coming forward with the concessions that he has.
I thank noble Lords very much for the lack of vituperation all round, which is deeply appreciated, and for their thoughtful speeches, although I think that this debate has been thoughtful all the way through the different stages. I have appreciated very much what noble Lords have said.
Let me try to answer some of the specific questions. The noble Baroness, Lady Pitkeathley, had forensic queries about the underlying entitlement. As she understands, that is quite complicated. We will go through these issues carefully and bring forward the regulations that allow us to frame the required exemptions, but I make it absolutely clear that our intention is that the exemptions should cover all the carer’s allowance underlying entitlement group, caring for at least 35 hours a week, and equivalent groups in universal credit. I hope that I have satisfied her on that. I confirm also that we will amend housing benefit and universal credit regulations in line, so I think that I have answered affirmatively—indeed, I always answer the noble Baroness affirmatively, as the House has now noticed.
Let me pick up the specific questions put by the noble Baroness, Lady Sherlock, on the two-child policy, when she skilfully asked me to make huge commitments. On the regulations and sight of them, I hope she will take this in the spirit in which I am presenting it. This will be a rather transparent process. The regulations are not straightforward. They are very sensitive in some areas and we will be working with stakeholders to get them right. I am not talking about an overly formalised consultation process, but I am talking about a transparent process—much more open than you will see with some of the other regulations. I hope that that satisfies her. I will allow her the indulgence of accusing me of not honouring the spirit of what I have said if she thinks I have not.
On the sibling group question—the sequential question—clearly, our intention is that sibling groups are kept together. As we draft the exemption we need to work with stakeholders and colleagues to get this exactly right because it is quite complicated. We will take the point made by the noble Baroness absolutely on board.
I think I ought to write to the noble Lord, Lord Kirkwood on the SSAC’s powers, which are rather wide. As the noble Lord knows better than anyone else, there is the power to have independent reviews, but I shall put in writing the exact status of what it can and cannot look at, so that others are able to see it. I can tell the noble Baroness, Lady Howarth, that our approach has been that it is not fair to treat parents adopting a child more advantageously than other parents, but we recognise the value of having sibling groups together. That is where we have concentrated our exemption.
I hear the point about domestic violence from the noble Baroness, Lady Manzoor. We have a series of measures to support victims who flee violent households, and I will write to her, laying out what those are. I am in absolutely no doubt that, as we get closer to defining the regulations, this is an issue to which various Members of this House will want to come back. I have probably said all that I can at this time on that. I beg to move.
Amendment 1 agreed.
2: Clause 8, page 9, leave out lines 38 and 39
Amendment 2 agreed.
3: After Clause 9, insert the following new Clause—
“Benefit cap: Social Security Advisory Committee
(1) In section 170 of the Social Security Administration Act 1992 (Social Security Advisory Committee), in subsection (5)—
(a) in the definition of “the relevant enactments”, after paragraph (al) insert—“(ala) sections 96 to 97 of that Act;”;(b) in the definition of “the relevant Northern Ireland enactments”, after paragraph (al) insert—“(ala) any provisions in Northern Ireland which correspond to sections 96 to 97 of that Act;”.(2) In Schedule 7 to the Social Security Administration Act 1992 (regulations not requiring prior submission), in Part 1 (Social Security Advisory Committee), after paragraph 3 insert—
“Benefit cap3A Regulations under section 96A of the Welfare Reform Act 2012.””
Amendment 3 agreed.
Clause 32: Extent
4: Clause 32, page 31, line 37, after “9” insert “and (Benefit cap: Social Security Advisory Committee)”
Amendment 4 agreed.
Schedule 2: Further provision about social housing rents
5: Schedule 2, page 38, line 18, leave out from “is” to “reduced” in line 19 and insert “the higher of—
(a) the amount that would be found under sub-paragraph (4)(a) if sub-paragraph (4)(a)(iii) were disregarded, and(b) the amount that would be found under sub-paragraph (4)(b) if the period in question were the whole of the relevant year in which the tenancy begins,”
My Lords, the amendment to paragraph 3(5) of Schedule 2 is to address ambiguity in the drafting and clarify that, in a case where the tenancy begins after the beginning of the first relevant year but not at the beginning of the second or third relevant year, the rent should be calculated in the following relevant year. The amendment also removes a redundant cross-reference to paragraph 3(2), which is a drafting error we had regrettably not spotted previously.
I would like to inform the House that a number of social housing providers have alerted us to an unintended consequence of the government amendment brought forward on Report, which sought to enable continuation of existing policy that affordable rents are inclusive of service charge when determined on the percentage of market rent principle, but exclusive of service charge when determined on the social rent model. We have looked at this and agree there is an issue in the drafting that we need to address. The Government will therefore be seeking to do so during Commons consideration of Lords amendments. I thank the providers who raised that issue with us, and apologise to the House that this has come up at such a late stage, and that we are dealing with it in this way.
The Bill returns to the other place without the proposed changes to the ESA WRAG, and the limited capability for work element in universal credit. It also now places a requirement on the Government to publish and report on income measures of child poverty. In sending these amendments back, the Cross-Benchers, in particular, have sent a clear message and I will say only this: there will now be a process between the two Houses, as is conventional. We have discussed many other matters during the passage of the Bill. Many of them are important and we will continue to reflect on them and seek to obtain the best outcomes we can. I beg to move.
My Lords, I thank the Minister for his explanation of Amendment 5. It makes the drafting of this area somewhat less impenetrable. I was going to say that it would be churlish, given the occasion, to point out that this is the third or fourth attempt to get this drafting right but clearly there will need to be a fourth or fifth, from what the Minister has said, and we welcome the point to which he has alerted us.
I take this opportunity to welcome the Minister’s action in deferring the impact of the rent reduction policy for a period and holding back on the local housing allowance. We will have to see where that leads. Of course, this point was pursued rigorously by the noble Lords, Lord Best and Lord Kerslake. My understanding is that this has not necessarily allayed the concerns of providers sufficiently and there is the risk of holding back on some key projects in relation to supported accommodation, which would be a great pity. So I think there is a task for the Government there.
With regard to the amendments that go back with the Bill to the other place, all we can do is urge the Minister to send it on its way with his wholehearted support.
My Lords, we broadly support Amendment 5. It is a positive change. I take this opportunity to thank the Minister for the very constructive way in which he has allowed us to meet him, because there have been great challenges in the Bill. It has been a very difficult Bill and he has been a master at defending a very difficult piece of legislation. I sensed at times that he himself felt, “My gosh, what are we doing here?”. I may be putting words in his mouth but that is the sense I got.
Obviously, there are significant financial cuts to some of the most vulnerable in our society. As the Minister is aware, I have been very concerned about the issues relating to the work allowance and the cuts that will affect working people. We have looked at the Bill through the prism of work. I am also very concerned about the cuts to employment allowances for people with disabilities and progressive illnesses. I state again that I really cannot understand how cutting £30 a week from the employment allowances for people in the ESA group is going to make them better and fitter and enable them to go back to work. I say to the Minister: this is going back to the House of Commons but please could the Government look at this? It is so important as a sign of a compassionate, caring society that we look after the most vulnerable. But I thank the Minister, and the Bill team, for the time he has given to the Bill and the very constructive dialogue he has held with us.
My Lords, the Minister made reference to the Bill going back to the other place without the provisions relating to the removal of the ESA WRAG premium and the comparable allowance under universal credit, and to the fact that he would be working to achieve the best outcome in relation to these provisions. I wonder if he would be prepared to meet my noble friends Lady Meacher and Lady Grey-Thompson and me so that we could work together on achieving the best outcome in relation to these provisions. My office is in touch with his office to see if we can set up a meeting with him and Priti Patel, who I believe has also been involved in these issues. I very much appreciate the support of the noble Baroness who spoke before me, and her plea for the Minister to give earnest consideration to this issue, with a view to achieving a better outcome than was in the Bill originally.
I hear what the noble Lord, Lord Low, has asked for—a meeting on this matter. Of course I would be pleased to meet him, and other colleagues, to discuss this as it wends its way back to the Commons, and perhaps back to us, depending on what happens.
May I take this opportunity to place on formal record my thanks to noble Lords throughout the House? They have discharged their duties to look at the Bill really conscientiously, and have worked hard on some difficult and sensitive issues. They have brought out some unintended consequences, and they have described them and expressed their case in calm, clear language, which means that we can take the points and aim to address them. Indeed, both today and on Report we have tackled some of them.
The Bill has been insulted by one or two noble Lords. I have to reflect back that it has raised some profound issues around what the benefit and welfare system does and how it works. Pinpointing where it affects the most vulnerable and how we can ameliorate that and sort it out has been really valuable.
I thank the Bill team, a handful of whom are in the Box now. They have been formidable in supporting me all the way through the progress of the Bill. I know that they have also been assiduous in briefing noble Lords, because we set up the system, which I have used with previous Bills, whereby there is a briefing ahead of Committee stage, so that when we debate these issues we do not waste time but are able to deal with the issues. The Bill team have done a really good job, and I believe noble Lords think so, too. I am sure I express the view of the whole House in thanking them for all their support.
May I, on behalf of the Opposition, thank the Minister for giving us access to his officials? I thank the Bill team and some very impressive policy people who have been briefing Peers from all over the House. We appreciate his generosity in giving us access to them, and their expertise and willingness to explain to us patiently—sometimes, if necessary, more than once —precisely how the Bill works. We are grateful for that. They have also been helpful in working with the wonderful Muna Abbas, from our Whips team, who has done a brilliant job in supporting us from this side.
We have not been persuaded by the Minister that this is anything other than a bad Bill—but now, as a result of what this House has done, it is less bad than it was. I pay tribute to Peers throughout the House, who have shown the House of Lords doing what it does best—being a revising Chamber which, even when it does not like legislation, focuses its attention on improving it and sending it back to the other place much better than it was. Long may we do so.
Amendment 5 agreed.
Bill passed and returned to the Commons with amendments.
Housing and Planning Bill
Committee (1st Day)
Relevant document: 20th Report from the Delegated Powers Committee
Clause 12: Introduction to this Part
A1: Clause 12, page 8, line 17, leave out “rogue” and insert “specified”
My Lords, it is an exciting privilege to set off this Committee. I do not know how many sittings we will have, but I am sure that by the end of it we will have completely forgotten today. I start by apologising for not tabling the amendments in time to go on to the Marshalled List. I was a bit spooked by the change in today’s business, so I apologise for that.
As it is the start of a new stage of the Bill, I should declare some interests: my membership of Pendle Borough Council, of which I am deputy leader; I am a vice-president of the LGA; and I am vice-chairman of the APPG on Local Democracy—I shall miss its reception today because of the Bill, and I would rather be there, but never mind. There will be other interests, but those relate to the amendments I have tabled at the moment. In moving my amendment, I shall speak to the others in the group.
We move straight to Part 2, and I say right from the beginning that, first, this is one of the better parts of the Bill and, secondly, it is one of the better written and presented parts, with a great amount of detail on the face of the Bill and in the schedules. If the whole Bill were like that, a lot of us would be a lot happier, but we can be happy for the time being. This part is headed:
“Rogue landlords and property agents”.
When I read it, I asked myself whether the word “rogue” is a proper word to appear in legislation. What does it mean? Is it not just slang and colloquial? Why is it here? We will come back to that.
Chapter 2—Clauses 13 to 26—is all about “Banning orders”. As I said, the clauses in this chapter are admirably clear. They require the Secretary of State to set out in regulations exactly what the banning orders may be put in place for but, nevertheless, by and large, it is a model of good legislation. Clause 13 bans a person from,
“letting housing in England … engaging in English letting agency work … engaging in English property management work, or … doing two or more of those things”.
That is absolutely clear. That is what a person is banned for if they get a banning order. The interesting thing is that, after the first clause of Part 2, the term “rogue” or “rogue landlord” does not appear at all.
What sort of offences are we talking about? It will require regulations, but it is clear that it could be maintaining their property poorly, posing a risk of harm to tenants or other people, dangerously overcrowding their properties, exposing people to unhealthy conditions, housing illegal immigrants, intimidating or harassing tenants who raise a complaint. These things are all absolutely clear, and clearly set out, but they are specific problems that lead to people being banned; it is not clear that they lead to a person deserving the epithet “rogue” or being given that epithet for however long.
In Chapter 3, we have the “Database of rogue landlords and property agents”. However, apart from a statement to that effect at the beginning of the chapter, the words “rogue landlord” do not appear again. Clause 27(1) says what the database is. It must include people with banning orders and it may include people convicted of a banning order offence while being a residential landlord or property agent. It includes some people who have to be on the list and some people who can go on the list, but it is all about banning orders and banning order offences.
This part of the Bill is complicated. I tried to get my mind round it perfectly, but I could not. Then I saw that it will rely on guidance from the Secretary of State so that local authorities can understand it in the way that I cannot. Okay, but it is very clear that what we are going to have is a register of banned landlords and others who have committed banning order offences. What will it be called? Will it be called the register of rogue landlords, because the word “rogue” does not appear in all this? I have the distinct impression that the phrase “rogue landlord” has been added to this legislation—after it was written by civil servants—by some spin merchant somewhere in the Government who thought it would be a good idea to get some good publicity to get it through. I do not think this is the way that legislation should be written. That phrase is in the heading, but it does not appear anywhere else.
Clauses 40 to 50, which are still under the part which is supposed to be about rogue landlords, are all about rent repayments. The phrase “rogue landlord” does not appear anywhere. It is not clear to me whether any landlords who get involved in the whole system of rent repayment are rogue landlords or not. The heading of this part of the Bill contains the words “rogue landlords”, but are they rogue landlords or are they just people on the list who are rogue landlords?
Chapter 5 is “Interpretation of Part 2”. Clause 52 quite rightly sets out in some detail the “Meaning of ‘letting agent’ and related expressions”. Clause 53 sets out the “Meaning of ‘property manager’ and related expressions”. Clause 54 is a typical clause at the end of a part of a Bill. It sets out the meaning of 16 different words and expressions, starting alphabetically with “banning order” and ending with “tenancy”. However, it does not define “rogue landlord”.
Another point about which I am not at all clear is whether, once a person comes off the banned list, they are still a rogue. The problem is that it is one of those words—once a rogue, always a rogue. What does it mean? I looked up the Oxford Dictionaries on the internet and it is full of colloquial meanings. For example, it mentions that:
“a distinct criminal culture of rogues, vagabonds, gypsies, beggars, cony-catchers, cutpurses, and prostitutes emerged and flourished”,
in the 16th century. I suppose that we would not accept Gypsies in that definition, but we are not going to have legislation denouncing people as coney-catchers or cutpurses. The synonyms in the dictionary include:
“scoundrel, villain, reprobate, rascal, good-for-nothing, wretch; … rotter, bounder, hound, blighter, vagabond”.
Later on, there was something about which I was not too happy—it says:
“Northern English informal tyke, scally”.
As a Yorkshireman born and bred, I was not too happy about “tyke” being there. Perhaps we will have legislation denouncing lists of “tykes” who have to be dealt with in some way. Another definition is:
“A person or thing that behaves in an aberrant or unpredictable way”,
I do not think “rogue” is a suitable word.
I have put “specified” in the amendment because I could not think of anything better. I was going to put “banned”, but it is clear that other people may also be put on the list who have not actually been banned but who nevertheless have been convicted of banning offences. It is not entirely straightforward, but I believe that the word “rogue” and the phrase “rogue landlord” are not appropriate to go into the law of England. The Government ought to think of another phrase which is less suitable for tabloid newspaper articles and more suitable for the law of the land. I beg to move.
My Lords, this is a perfect description of the kinds of people we are dealing with. It will emphasise in the public mind exactly what is going on in the area of housing rental, and I hope that the Government will not give way on this amendment.
My Lords, I am so pleased to be on the same side as the noble Lord who has just spoken. It seems a frightfully good word, it says exactly what we mean and it would be very nice if more of our legislation used language which we understood. “Rogue landlord” is a very good phrase to use because it is very important to underline how disgraceful some people are in their treatment of other people in this crucial part of their lives. My only objection is that the word is not used more frequently within the Bill, because there are several references within it where a reminder that this is a rogue-like activity is very necessary.
My only other objection is that “rogue” has a certain rather light touch—it is not as nasty as a number of other words that were used. Perhaps if we had to change it, we could go through the list that the noble Lord has put forward and choose something that is thoroughly more unpleasant than the word “rogue”. However, I cannot imagine why anybody should start this very serious debate off with a discussion about the word “rogue”. This is one of the best things in the Bill. I may have to draw my noble friend’s attention to a number of other things later on as requiring significant amendment, and many things are left out of the Bill that I would like to see put in, but the one thing I certainly would not like to see left out is the word “rogue”.
My Lords, I understand why the noble Lord, Lord Greaves, would not wish to be considered to be a member of the “Liberal Demotic Party” but we have more important things to discuss in the 14 groups that are before us. I trust that the noble Baroness will deal with the matter briefly, and then we can get into the substance of the Bill.
My Lords, before I begin, I will correct a comment I made at Second Reading. At col. 1266 in Hansard I attributed a comment to my noble friend Lord Young of Cookham but he did not make that comment. Obviously, I cannot correct it in Hansard because I said it, so I use this opportunity to correct the attribution.
I will deal with the amendment briefly. When I saw the word “specified”, I thought of “specified housing” as opposed to a person. The public understand the concept of a rogue landlord, just as they would understand the concept of a rogue trader. BBC 1 in the morning is full of stories of rogues of various descriptions, so it is understood in the public mind. However, just to be clear, the majority of landlords and letting agents provide a good service, and we should commend them for doing that. This part of the Bill, which is widely supported, is about tackling the small minority of rogues who deliberately flout the rules. We should call them out for what they are, as they are rogues. It is important that we send a clear message through the Bill that such practices will not go unchecked. I therefore ask the noble Lord to withdraw the amendment.
The noble Lord will know very well if he is a rogue landlord, because I will now read out the definition. It is a landlord or property agent who knowingly flouts the law by renting out unsafe and substandard accommodation. To be on the database, they will have to be convicted of certain serious offences—and, for that, they may come before your Lordships’ House.
My Lords, that is not the correct definition, with respect to the Minister, unless being banned by a First-tier Tribunal is a conviction. Perhaps it is—it is certainly a status—but it is clear that people banned by the First-tier Tribunal will be on the banned list. One assumes that they are therefore rogue landlords under the definition in the Bill, so they would not have to be convicted in a higher court of law. Yes, the Minister is nodding her head.
I will be brief. I am no friend of bad landlords—far from it. In the part of Colne that I represent, parts of those streets have been wrecked by bad landlords, and I agree that it is a clear phrase in the public mind. However, we are not talking about the public mind but about phrases that will have to be interpreted at some stage by the courts of the country. We are talking about words written into the law of the land. The use of such colloquial expressions, which are perfectly okay on breakfast-time television as the people who are denounced there deserve everything they get, will get us into trouble if we put them into the law.
If the Government are really determined to put this rather unusual and extraordinary expression into the law of the land, it ought to appear in the list of definitions at the end of Part 2 so that we have a clear definition of it, because when the Minister was asked just now she did not quite give an accurate one. At the very least, I ask that it appears in the list of definitions because words mean what they say. This is not Humpty-Dumpty land. Words actually have a meaning and, when it comes to the law, words have more of a meaning than they do in chat in the pub or on breakfast-time television. Having said that, I beg leave to withdraw the amendment
Amendment A1 withdrawn.
Amendment B1 not moved.
Clause 12 agreed.
Clause 13: “Banning order” and “banning order offence”
C1: Clause 13, page 9, line 1, leave out from “means” to end of line 10 and insert “—
(a) unlawful eviction of a tenant; or(b) failure to comply with an improvement notice in relation to property conditions.(4) The Secretary of State may by regulations made by statutory instrument amend the list of offences in subsection (3).(5) A statutory instrument containing regulations under subsection (4) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”
My Lords, I shall speak also to Amendment 8ZA. Both amendments stem from the 20th report of the Delegated Powers and Regulatory Reform Committee, published just last Friday—hence the fact that they are manuscript amendments. Both the clauses affected, Clauses 13 and 22, have attracted considerable criticism from the committee. They relate to the introduction of banning order offences, about which the committee expresses serious concerns.
A ban would arise following conviction for a banning order offence and would prevent the relevant person from letting or engaging in letting agency or management work, as a result of an order made on the application of a local authority. It would also ban the relevant person from holding an HMO licence and allow him to be placed on a database. However, the Bill does not define the offence that would allow the Secretary of State to describe its nature, the offender’s characteristics, the place where it was committed, the court passing sentence and the sentence itself by regulations subject to the negative procedure—with no restriction whatever on the character of the offence, which need not be related to housing issues at all.
In a memorandum, however, a wide range of offences is cited as possibly relevant. The committee sensibly pointed out that these offences could be listed in the Bill with a power to amend, if necessary, by secondary legislation. The committee averred:
“We consider it inappropriate that the determination of the offences that are to constitute ‘banning order offences’ should be left entirely to the discretion of the Secretary of State and with only a modest level of Parliamentary scrutiny”.
The committee recommended removing Clause 13(3) and replacing it with a provision listing offences constituting banning order offences, with a delegated power to amend by the affirmative procedure.
The amendment tabled today defines—very narrowly, it must be said—the grounds for a banning offence, and requires parliamentary approval for the relevant regulations. The grounds may be considered too narrow. I hope that the Minister will look at the issue and come back on Report with a more developed position in which parliamentary approval for any new offence is required.
Amendment 8ZA to Clause 22 relates to the provision for financial penalties for a breach of a banning order which may be imposed by the local housing authority. Subsection (9) requires the housing authority to have regard to any guidance given by the Secretary of State in respect of the exercise of its function under the clause. The amendment simply requires that such guidance should take effect only under the affirmative procedure. The amendment to Clause 22 relates to the provision in the clause in respect of the financial penalties for a breach of the banning order which may be imposed by the local housing authority.
The Delegated Powers Committee noted that Clause 22 allows a housing authority to impose a penalty of up to £30,000 for the breach of a banning order and points out that this is an alternative to a criminal prosecution. Unlike in the latter procedure, it will not be necessary for the authority to prove its case beyond reasonable doubt, such that, to quote the committee,
“this clause empowers an authority to act as if it were prosecutor, judge, jury and executioner”.
The provision in subsection (9) requiring the authority to have regard to the guidance means that such guidance will be expected to be followed unless there are cogent reasons for not doing so. The committee concluded that, given the nature of the power conferred on local housing authorities—which would deny the accused access to adjudication by a court as to whether a criminal offence had been committed—the guidance is of great significance, and accordingly that it should be laid in draft and not come into force with the affirmative procedure.
These observations essentially foreshadow the amendment to be moved later by the noble Baroness, Lady Gardner of Parkes. I think that we are at one on this: indeed, there was, I think, wide agreement around the House at Second Reading that there are far too many areas that are to be covered by regulation with no evidence that any of this will be presented to us as the Bill goes through. It may be ready for other parts of the Bill but there is nothing today on these matters. Unless we have an assurance from the Minister that we will be able to see regulations before Report, the House should take a strong view in support of the amendment which I now move.
My Lords, I rise in support of the amendments that have just been introduced. At Second Reading I welcomed some parts of the Bill but expressed concerns about some others: about the lack of detail, the large number of amendments laid at the very last minute in another place—again, without an opportunity for proper scrutiny—and the 30-odd additional powers given to the Secretary of State. Like many other noble Lords, I very much welcome the Minister’s commitment and promise to do all that she can to ensure that we get details of the various regulations, at least in draft form, as early as possible.
I think that many noble Lords, however, will share my concern that, despite the Minister’s promise, it seems increasingly likely that many of those draft regulations—even if we get them before we finish consideration of the Bill—will not come in time for the relevant amendments in Committee, and it may well be that some of those draft regulations will come after we have finished all stages of our deliberations in the House.
As has already been said by the noble Lord, Lord Beecham, we owe a debt of gratitude to the noble Baroness, Lady Gardner of Parkes, for tabling Amendment 1. Had it not been trumped by the amendments now before us, it would have been our only opportunity to express the concerns we have about the lack of detail and regulation. But since the noble Baroness laid her amendment we have now seen, as of yesterday, the 20th report from the Delegated Powers and Regulatory Reform Committee. It is a pretty coruscating document.
For those noble Lords who have not read it, it refers to a section of the Government’s memorandum to the committee and states:
“The memorandum gives only the barest explanation or justification for this power; indeed it seeks to dismiss this highly important provision as ‘quasi-technical’”.
“The intended meaning of that expression wholly eludes us, and the House may wish to ask the Minister for an explanation”.
No doubt when we get to the relevant section of the Bill we will ask for that.
On Clauses 13 and 22, which are referred to in the amendments before us, as we have heard, there are numerous criticisms raised by the committee. It makes the point that there is no restriction on the type of offences that may be specified in regulations. It goes so far as to say that it does not have to be one connected with the letting or management of housing and could even be one committed before the enactment or coming into force of the Bill.
The committee points out, however, that some types of offences are described in the memorandum and that it cannot understand why the banning order offences are not listed in the Bill, together with a delegated power to amend the list as necessary. It points out that this is particularly puzzling given that the Government have succeeded in devising a list of offences in Clause 39, conviction for which could result in a First-tier Tribunal making a rent repayment order. That is why, as we heard from the noble Lord, the committee said:
“We consider it inappropriate that the determination of the offences that are to constitute ‘banning order offences’ should be left entirely to the discretion of the Secretary of State and with only a modest level of Parliamentary scrutiny … We therefore recommend that clause 13(3) be removed from the Bill and replaced with a provision listing the offences that constitute ‘banning order offences’, coupled with a delegated power to amend the list by affirmative procedure regulation”.
The committee is equally critical of the subsections of Clauses 13 and 22 which are referred to in the amendment. It is therefore to be welcomed that the amendment does just what the committee suggested should happen—it introduces a list and states that there should be an affirmative resolution for any subsequent changes to that list.
I am puzzled by one aspect of Amendment C1; perhaps the noble Lord will refer to it when he winds up. In the memorandum provided by the Government to the committee they say:
“It is envisaged that the type of offences which would be able to trigger an application for a banning order would be serious offences, including a conviction in the Crown Court for offences involving fraud, drugs or sexual assault that are committed in or in relation to a property that is owned or managed by the offender. It is also envisaged that a banning order may be sought where a person has been convicted of certain specified housing offences, which will include offences such as unlawful eviction and failing to comply with an improvement notice in relation to property conditions”.
The last two specified housing offences are referred to in the amendment, but no others are proposed, and there is no reference in the amendment to the conviction in a Crown Court for offences involving fraud, drugs or sexual assault.
The Government are saying that those offences should be included in the list. We believe that there should be a list, as proposed in the amendment, and hope, as the noble Lord said, that the Minister will reflect on this and add those offences to the list. We hope very much that the Minister will give her support for this and that in the event it will not be necessary to deal with Amendment 1.
My Lords, it is quite understandable why the Government have been—if I may put it like this —so loose in the wording, because they do not want to get themselves into a position where they cannot act when an offence of some notoriety takes place. I understand that. However, the big issue here for me is a very fundamental one about the freedom of people in this country. One needs to know that beforehand when one is doing something that will lead to one being punished. My concern here is that there is no certainty and that it might alter depending on who is the Minister responsible. In recent days, we have had an example of how different ways of looking at justice can proceed from Ministers of the same political party—if I may put it as delicately as that.
In those circumstances, it might be of advantage to have a list and to be a little tighter here, while still giving enough elbow room for the circumstances in which a rogue landlord might find some way to behave which we have not yet thought of. As a Member of Parliament for a very long time, my experience of rogue landlords was that they are infinite in their ability to discover mechanisms by which to penalise, harass and indeed destroy the lives of their tenants.
I am sympathetic to this amendment, and think it should contain some of the points raised by the noble Lord, Lord Foster, but I hope also that we would be sympathetic to the Minister on this, because it is important that we should be able to move with the crime. We should not be so caught by the phraseology that we cannot deal with something which we have not thought of yet. With that proviso, I wonder whether my noble friend will look again at the way this is done, so that we can protect that essential freedom whereby I know in advance what will happen if I do something which I should not do, rather than not knowing in advance what will happen if I do something which I might find out someone else has decided I should not have done. I just do not think that is a very good basis for English law.
My Lords, I want to intervene briefly again, because this raises an issue of principle which came up during our consideration of tax credits. If you read the report of the Joint Committee on Conventions—the Cunningham report—you will find, under one of the sections, the conditions in which the House feels it is entitled to vote on fatal amendments. I am increasingly of the view, as I think are a number of other Members on this side of the House, that the Government are now abusing legislation by introducing skeleton Bills and bringing in, on the back of them, statutory instruments which they feel the House cannot consider in detail because we cannot amend them. This is a classic case of where, had the House had been given more information in the Bill, we would at least have had the opportunity to debate the detail, within the circumscribed area referred to by the noble Lord, Lord Deben, that would allow for flexibility. We could have considered in some detail what the crimes—if I might use that word, although it is a very broad one—might be.
I feel very strongly about fatal amendments. When it came to the consideration of tax credits, I was one of the very few Labour Peers who refused to vote, on the basis that I did regard what we were doing as fatal. That is how strongly I felt. However, increasingly in conversations with others, they will point to these recommendations on skeleton Bills and the use of SIs. One is being driven into a position whereby one has to vote on fatals—something which I never wanted to do when I was brought to this House some 15 years ago. As the Bill progresses, the noble Baroness should have it in mind that we need more detail, particularly in areas where Members might feel they wish to amend primary legislation.
Amendments C1 and 8ZA relate to the same issue, so I shall address them together. Amendment C1 would remove Clause 13(3) from the Bill and replace it with a provision listing the offences that constitute banning order offences, namely,
“unlawful eviction of a tenant; or … failure to comply with an improvement notice in relation to property conditions”,
and would require that regulations to amend the list be subject to affirmative resolutions.
Amendment 8ZA would amend Clause 22, and would require financial penalty guidance to be laid in draft before Parliament, and not brought into force without an affirmative procedure resolution of each House.
We propose to define banning order offences in secondary legislation, as this will give us the flexibility to amend the list of banning order offences in the light of experience, as my noble friend Lord Deben said. As he has also requested in terms of certainty, we are sympathetic to that and we will consider it further.
Clause 13(4) explains what matters may be taken into consideration when setting out in regulations what are banning order offences. Banning order offences are likely to include a serious offence, where an offender has been convicted in the Crown Court of an offence involving fraud, drugs, sexual assault or violence that is committed in, or in relation to, a property that is owned or managed by the offender, or which involves, or was perpetrated against, persons occupying such a property. A banning order offence also includes any serious offence involving violence against the tenant by the landlord or property agent, and serious breaches of housing legislation.
We are planning to publish the secondary regulations in draft and will consult on these in the autumn before they are laid before the House. These will all be existing offences that already have serious consequences for those who are convicted. We are introducing civil penalties as an alternative to prosecution, and these will be available for certain serious breaches of housing legislation. The guidance for local authorities will be procedural and will provide advice on when it may be appropriate to issue a civil penalty rather than prosecute, together with advice on what might be the appropriate level of penalties.
The noble Lord, Lord Beecham, asked about the right of appeal for civil penalties. The landlord will have a right to appeal against a civil penalty to a First-tier Tribunal and can either cancel or decrease the penalty. Several noble Lords have brought up the DPRRC and its recommendations on the delegated powers in the Bill, including those highlighted in these amendments. I can confirm to noble Lords that we will consider the committee’s recommendations and respond in Committee if possible, but certainly before Report. I hope that, with those comments, the noble Lord will feel content to withdraw the amendment.
Before the Minister sits down, can I confirm my understanding of what she has said about secondary legislation? There was a request earlier that a draft of the secondary legislation should be made available to this House before Report. Yet I understood the Minister to say that there would be a draft of the secondary legislation in the autumn, which is clearly not before the Report stage. This is an extremely important matter, so can the Minister confirm exactly what the Government plan to do?
My Lords, I am grateful for the Minister’s reply so far as it goes but there remain significant problems, particularly the contrast between a local authority being able effectively to impose a penalty of up to £30,000 for breach of a banning order on the basis of the balance of probabilities as opposed to a criminal prosecution, where of course the case would have to be proved beyond reasonable doubt. I am not at all sympathetic to rogue landlords, however they are described, but it is a curious position to have two processes, one of which requires a higher standard of proof than the other. That cannot really be satisfactory. In some respects, it may well be better to bring such a person to the courts on a criminal charge rather than the local authority taking action and securing financial compensation, yet that is a choice that will be left to the local authority. I am normally very much in favour of local authority discretion, but in this area we have to be careful not to infringe the responsibility of the judicial system. I invite the Minister to undertake at least to consider this aspect as well as those that she has already agreed to take back.
I am happy to consider it, but the guidance for the local authorities will make it clear in what circumstances it would be appropriate to use a civil penalty rather than to prosecute. If it would be helpful, though, I will set out more detail around the two routes available.
That would be extremely helpful, but it would be particularly important to be clear what standard of proof is required under the procedures involved. Would it be the same standard of proof or a different one? I am not asking the Minister to answer that at the moment, but I would hope for an assurance that that would be dealt with in the information that she has kindly offered to supply. I assume that her nod was a nod of consent. I beg leave to withdraw the amendment.
Amendment C1 withdrawn.
Clause 13: “Banning order” and “banning order offence”
1: Clause 13, page 9, line 10, at end insert—
“( ) This section shall not come into force until at least one year after the publication of a draft of regulations to be made under subsection (3).”
My Lords, I am very grateful to the noble Lord, Lord Beecham, for covering so much of the explanation of what the wording of my amendment means. It looks a bit obscure to me, but I understand that it is the appropriate tool for bringing up the issue of the regulations. I consider that we cannot satisfactorily deal with the Bill in its present form without proper consideration of the proposed regulations. I am impressed by the comments already made by the noble Lords, Lord Shipley and Lord Foster of Bath, who have done a lot of explaining that I would otherwise have to do.
At Second Reading, of the 50 speakers, more than 20 drew attention to the need for us to have the detail, in the form of draft regulations, available for us to consider during this stage of the Bill. The noble Baroness, Lady Andrews, said:
“Vast swathes of policy are left to secondary legislation”,
“The Bill deserves, and I am sure will get, the most intense challenge and scrutiny in this House”.—[Official Report, 26/1/16; cols. 1188-90.]
The noble Lord, Lord Kerslake, ended his speech with the words:
“First, we urgently need to see the detail of what is proposed in the secondary legislation. Secondly, we need Ministers to be genuinely open to change”.—[Official Report, 26/1/16; col. 1195.]
I believe that Ministers are genuinely open to change but that there is some degree of obstruction within the department. When we have had our three meetings with the Minister on this issue, they have said that they feel they cannot get anything through in time and that all this could be looked at after the Bill receives Royal Assent. Of course, that is hopeless: if we look at things after Royal Assent, all we can do is have a statutory instrument come forward, to which we say yes or no. We are not then in a position to improve the legislation.
The noble Baroness, Lady Royall, said that,
“the regulation rot sets in at line 14 and continues throughout”.
Then she said:
“The details will be determined by regulation”.—[Official Report, 26/1/16; col. 1197.]
There it is again. The noble Lord, Lord Palmer, speaking about,
“the lack of published regulations relating to the Bill”,
“I suspect that that is because they have not even been written yet”.—[Official Report, 26/1/16; col. 1239.]
That was a fairly appropriate remark, particularly in view of what had been said at our pre-meetings.
The noble Baroness, Lady Grender, wanted regulations now. Again, she is one of many of us who have said that. The noble Lord, Lord Whitty, said that he was expecting,
“vast reams of secondary legislation. Many of the clauses have not been properly considered and received cursory—if any—scrutiny in the Commons”.
I think that is true. The Bill has been pushed on to us after the barest consideration in the Commons, which makes it doubly important that we carefully consider every aspect of it in this House. The noble Lord went on to say:
“This Bill gives 34 additional powers to the Secretary of State”.—[Official Report, 26/1/16; col. 1254.]
That is highly significant.
The noble Lord, Lord Foster of Bath, made a point, which the noble Lord, Lord Beecham, also made, about the report of the Delegated Powers and Regulatory Reform Committee. I know its title well, because I served on that committee for almost 10 years —certainly for more than two terms—and I have never read a more scathing report than this one. I would not even have realised that it had been published, because it came out so close to time, had I not, at Questions earlier today, found myself sitting next to the chairman of that committee, who asked me whether I had seen the report. I left Question Time early to run out and get it, to see what it said. It affirms what we are saying: we need all this. We need the information so that we can deal with what is before us. As I said, once the Bill receives Royal Assent, it is too late for us to make any significant change. It is a very interesting and enormously powerful Bill, and it must be considered very carefully. Local authorities, too, have the right to know the detail of what is being considered, so that they can send their comments to Members of this House, and we can decide what we should be doing. I beg to move.
I support the noble Baroness and, in doing so, I declare my interests, first as a professional property manager, and—possibly even more significantly—as a private sector landlord. I believe I have a very contented set of tenants, without any of the roguishness that we have heard about.
Leaving aside the absence of a clear due process in the Bill and the safeguards that should go with that, in what I can describe only as this “subcontract” process to local government, putting to one side the non-judicial disposal of a case that might result in the label “rogue”, with lasting stains on character, and parking for one moment the hiatus in terms of the standard of proof referred to by the noble Lord, Lord Beecham, there remains an overriding need for Parliament to retain scrutiny of the process, the safeguards and the standards. At the moment we seem to be short of a commitment on that.
I am also concerned that the whole process is a bit reactive, populist and, if I may say so, potentially discriminatory against a class of person called a landlord or their letting or managing agent. At Second Reading, I advocated—at least, I hope it was interpreted that way—perhaps going beyond that to try to support and nurture best practice, in equal measure carrot and stick. It seems to me that landlords can very easily be pilloried by their feckless tenants in the same way that tenants can clearly be very easily prejudiced by malevolent landlords.
There are probably at least as many undesirable tenants, in numerical total, as there are undesirable landlords. I do not say that in any way to cast aspersions on the tenants. I believe that the vast majority of them, in the same way as landlords, honour their commitments, try to do the best thing and genuinely create something that is growing in popularity. It is an expanding sector. The last thing we need to do is to set about damaging it so that people feel that they are under the cosh and go away. At Second Reading, I referred to the fact that our European neighbours seem to have sorted this out without this continual anti-landlord or anti-tenant adversarial approach in their dealings.
Therefore, we need to look at the whole situation and—if I may put it this way—somehow invert the process. Perhaps having the regulations before us is one step on the way so that we can look at that in detail and examine what the actual process is. At the moment, it would be possible for almost anything to be passed down to local government. As a vice-president of the Local Government Association, I would be slightly fearful, as a local government chief officer, of what might get passed down to me, thank you very much, as a hand-me-down to police this sector.
I support the noble Baroness. The key to this is very much to get these regulations out, and I support the general thrust of her amendment.
In a sense, everything has been said about this issue, but we must put on the record, for the avoidance of any doubt, that this amendment in the name of the noble Baroness, Lady Gardner of Parkes, is extremely important. As we have heard, had it not been for the manuscript amendments, this would have been the first that we discussed. It brings to the fore the issue of principle about the role of your Lordships’ House.
I agree that the Delegated Powers and Regulatory Reform Committee’s report is one of the most critical—possibly the most critical—that I have read. For that reason, it matters profoundly how the Government react to it. This House must be able to do its job properly. With so much being left to secondary legislation and so much that will not be with us by Report, the Government will have to do a very urgent job.
It has been asserted that perhaps the secondary legislation has not been drafted. It really ought to have been. If it has not been, we should be told. If it has been, and it is in a form that we could see, even if it is a draft of a draft, that would be extremely helpful. I think the Minister understands the strength of feeling in your Lordships’ House about this issue. I sincerely hope that she can respond positively to the amendment moved by the noble Baroness, Lady Gardner of Parkes.
My Lords, I warmly endorse everything that the noble Lord, Lord Shipley, has said, and I, too, pay tribute to the noble Baroness, Lady Gardner of Parkes, who of course has long had an interest in these matters and has repeatedly raised them in your Lordships’ House.
It is important that the Government listen to the experience of Members from a variety of backgrounds, who know a good deal about the implications of legislation of this kind. There is a temptation to legislate in haste with a risk that you—or, more particularly, other people—repent at leisure. There is that concern about the way this matter has proceeded thus far. I fear that it is not uncommon for the committee to comment adversely on the way that matters are brought before your Lordships’ House. Lack of consultation and the reservation to government of powers to prescribe by secondary legislation, which may not come for a long time or sometimes come into force before any scrutiny has been given, is particularly invidious when we are looking at areas such as this, which impinge on the lives of many citizens.
The noble Earl, Lord Lytton, has a point, particularly about the role of local government. If the duties of local government are to be expanded—and they ought to be in this respect—that is clearly a new burden under the convention which is supposed to apply to new duties imposed on local government and will have to be resourced. In certain areas, there will be significant resource implications. That is a function of the expansion of the private sector market, in particular. The noble Earl referred to the growth of the sector, which has been substantial. We now have a very high proportion of properties rented in the private sector, sometimes by very reputable bodies. I am particularly pleased to see well-established, reputable financial institutions now looking at entering the market to provide such properties. I would not take it for granted, but they are more likely to be responsible owners and managers of private rented properties than some others of the character we have been discussing, of whom there are, unfortunately, too many.
The reality is that the market has expanded hugely because of the constraints on the building of local authority housing—social housing—which are likely to increase if other parts of the Bill go ahead unamended, and because of the general property shortage. Astronomical rents are being gleaned for little effort in either investment or management, save for the purchase price. That clearly colours our debate.
I concur with those who ask the Government to produce something before the Bill completes its course, even if only early drafts. We need to know the direction in which they are going. We need assurances about how the duty is to be resourced. I do not blame the Minister for this, but, thus far, those have not come over the horizon. I hope she will pass on the feelings that have been expressed across the House in an effort to encourage others in the department to get on with the job. That is, to bring forward material not just devised in Whitehall offices but after discussion with reputable bodies which have an opinion to give: local government, certainly, but also other organisations in the sector. Representatives of tenants and citizens advice bureaux, for example, deal with many cases of difficulties arising in landlord-tenant relations.
The noble Baroness is obviously of sympathetic mind. I hope that the opinion of the Committee today will reinforce her endeavours to persuade colleagues to react positively to something that is intended to improve the legislation, not to destroy it in any way, and make it effective in the interests of all parties.
My Lords, I was a colleague of my noble friend Lady Gardner of Parkes on the Delegated Powers Committee for a while. My experience on that committee was that it thought very carefully before making a recommendation. In general, it has been the House’s experience that the committee’s recommendations, particularly the more severe ones, are to a large extent accepted. I hope that my noble friend on the Front Bench will be able to persuade her colleagues that the recommendations we have been discussing—Clauses 13 and 22 come to mind—need to be taken very seriously and responded to in a positive manner, not pushed off into any form of long grass.
My Lords, I repeat my congratulations to the noble Baroness on being the first in your Lordships’ House to lay an amendment on this very important issue. I echo all the words of my noble friend Lord Shipley, although he left one issue rather hanging in the air: the current state of play with the drafting not only of regulations in respect of Clause 13, which we are discussing, but of all others. Perhaps in her reply the Minister will be kind enough to inform the House what her understanding is of the state of play with the drafting of legislation which affects the Bill.
My Lords, I understand loud and clear the premise of the amendment of my noble friend Lady Gardner of Parkes, which proposes that the scheme for making the banning orders would not come into force until a year after the draft regulations setting out the nature and characteristics of banning order offences have been published. I understand the point about the laying of regulations and responding fully to the comments of the DPRR committee, which noble Lords have made loud and clear. However, I make it clear that people who have been convicted of offences that are in the nature of a banning order offence before the legislation comes into force cannot be subject to banning orders. That is quite important in the context of the discussion we are having. The legislation will therefore not apply retrospectively.
As I have said before, we have not included the specific offences in the Bill because we want the flexibility to add further. However, I can confirm that we will consult fully with interested partners on the matters that will constitute banning order offences before the regulations are laid in this House. I have set out the timetable for the consultation and for responding to the DPRRC. I hope to do that during Committee stage, but in any event we will definitely do it by Report.
I cannot remember which noble Lord—it may have been the noble Lord, Lord Foster—asked if we could have sight of what regulations there might be, when we might expect them and why we might not have them in a timely manner. I am more than keen to get what information I can to noble Lords to prevent some of the obvious concern that arises out of the Bill coming forward time and again, which it will—I cannot blame the House for doing that. The noble Lord, Lord Kerslake, is not in his place, but I point out that we are attempting to do that as fully as we can throughout the course of the Bill.
I hope that reassures my noble friend and other noble Lords that we do not intend to implement the banning order provisions in the Bill without fully considering the views of the interested parties on the nature and characteristics of such offences. We began that process last summer when we published our discussion paper on tackling rogue landlords, which noble Lords may or may not have seen, and we will develop them in further detail through further consultation later in the year. I therefore ask my noble friend to withdraw her amendment.
My Lords, I thank all those who have contributed very helpfully to the amendment and debated it. When the Minister says that she is more than keen to do things and make progress, I believe that. However, I feel there is a lack of willingness in the department. I do not say that just because she now happens to be the Minister. I had dealings with the Minister before her and with various Ministers before that. In all housing issues, I have found that there has been a reluctance to see any proper reform or progress. That is a great pity. We should probably have had a consolidation Act of all the property laws that have been passed. I have been involved in them myself since the early 1980s. All noble Lords know my registered interest, so I do not need to repeat it. Each time we pass another Act everyone working anywhere in the property world has to keep referring back to the previous Act and the Acts before that. I am told that consolidation Bills are not brought forward now because, in the past, the Law Commission used to finance them and bring them to Parliament. It will no longer do so unless Parliament agrees to finance the work that it does. This also needs a little bit of thought.
Something else that needs thought is the First-tier Tribunal. I opposed the removal of the leasehold valuation tribunal which could have dealt with the same sort of issue at a much lower cost. It is now extremely expensive. It used to be only £500. No matter what your case, more than £500 could not be awarded against you for most leasehold offences. Now, to bring your case at all, it is a minimum of £500 to walk in the door. It has changed into a much heavier legal procedure which I do not think works so well for simple cases. It has always been there and acknowledged to be necessary for the more important or serious cases. Certainly rogue landlords will come into that category. I did not speak earlier but, of course, the word “rogue” means something different to me as an Australian.
To return to the original point, I respect what the Minister has said. I hope she can persuade her department to bring these matters forward. I thank all those noble Lords who have participated and I beg leave to withdraw the amendment.
Amendment 1 withdrawn.
Clause 13 agreed.
Clauses 14 and 15 agreed.
Clause 16: Duration and effect of banning order
2: Clause 16, page 10, line 12, at end insert—
“( ) A banning order must specify how many tenants are thought to be affected by the banning order and what arrangements will be put in place to mitigate against those tenants becoming homeless.( ) A banning order must specify that a local authority has given due consideration to issuing a management order to ensure existing tenancies are continued, wherever possible.”
My Lords, these Benches welcome moves in this Bill to deal with rogue landlords, but this amendment deals with what I believe to be a possible unintended consequence which I think the Government and the Committee should consider.
When a landlord is banned what happens to any existing tenants of that landlord? This Bill lacks clarity in this situation. In Clause 16(4)(a) the implication is that existing tenancies will normally need to be brought to an immediate end with the following wording:
“A banning order may… contain exceptions—
to deal with cases where there are existing tenancies and the landlord does not have the power to bring them to an immediate end”.
On the face of the Bill, this seems to suggest that the preferred route in these circumstances would be an immediate end to all other tenancies. The danger here is clear. An immediate end to a tenancy of someone already in the precarious situation of renting from a rogue landlord means for many the threat—or maybe the reality—of homelessness or rooflessness. My amendment tries to provide a safety net for any tenants who will be in danger of becoming homeless as a result of a ban.
We also need to assume, in a worst case scenario, that the banned landlord has two options. First, he could transfer property to another party. In spite of the list of exceptions in Clause 26, let us assume, for the sake of argument, that the address book of this rogue landlord is not littered with responsible social landlord friends and acquaintances to whom he wishes immediately to transfer his property. The second option is immediate eviction and a quick sale of the property.
This brings me to the tenant. If they are living in appalling conditions, with a bad landlord, but know and understand that their complaint will result in eviction, will their fear of this outcome reduce their likelihood of making use of this welcome change in the law? Will local authorities in turn worry that to ban a landlord will result in more people being accepted as unintentionally homeless on their books? Is there a danger that these tenants will be classified by local authorities as intentionally homeless because of mandatory possession under Section 8 of the Housing Act 1988? The risk of that increases with buy-to-let mortgages when landlords get Section 8s in situations of mortgage arrears and repossessions.
I have a further question for the Minister suggested by the amendment: if the exemption in the Bill is in place because of existing tenants, where does that rental income go—directly to a landlord that the local authority is trying to ban at that point in time? The amendment simply attempts to ensure that a possible consequence is anticipated and dealt with in advance by understanding the likely impact on tenants. I guess that there are some ideal scenarios; perhaps the Government should consider an option where the local authority could be given the freedom to step in and appoint a suitable person or agency to manage the other properties, although obviously that would need to be with sufficient resource. Either way, the amendment throws light on an issue in the Bill that needs serious consideration.
Last week the Minister spoke in the Moses Room with great conviction about preventing homelessness. Will she please give an undertaking today to look again at this part of the Bill to ensure that homelessness is not the outcome of a banning order on a rogue landlord? We know that the end of a private tenancy is now the most common cause of statutory homelessness, accounting for 31% of all households accepted as homeless in England and 42% in London. These Benches believe that this part of the Bill has laudable intentions, but if the consequence is to make more people homeless then it is a very high price. I beg to move.
My Lords, I support my noble friend’s comments and agree with everything that she has said. I shall speak specifically to Amendment 7, which is in this group and is a probing amendment.
Banning orders are a very important element of the Bill. They are not undertaken lightly and involve a great deal of research and work on the part of the local authorities. It takes many months of gathering information from tenants and consulting with related agencies operating in the sector, such as Citizens Advice, food banks, social services and local housing associations, to build up a picture around a person who they are investigating with a view to considering a banning order. Local authorities’ budgets are extremely stretched, as we know, and while it is to everyone’s advantage that they undertake this work in order to achieve a successful outcome when they apply for a planning order, it seems not unreasonable that they should receive the fine as recompense for the work undertaken. This will be especially important when it is highly likely that the local authority will be expected to house those previous tenants of the landlord subject to the banning order, as my noble friend has indicated.
There is an undertaking that local government will not be expected to take on new burdens that are not listed in the new burdens doctrine, with the expectation that the Chancellor will have had regard to this requirement when making the local government settlement. I would be grateful if the Minister could confirm that this is the case. Might she also be able to find a way forward to recompense local authorities in some way for this additional work, which is desperately needed by private sector tenants?
My Lords, the noble Baroness, Lady Grender, has raised a very important matter, and it is appropriate that it should be grouped with government Amendments 3 and 4. As the noble Lord, Lord Deben, mentioned earlier, there is no limit to the amount of roguishness that can come about. As to the question of identifying who is the perpetrator, who the owner and who the person in control—is it a company and or an individual?—these are murky waters, particularly with patterns of complex ownership, possibly involving ownerships of non-domestic individuals or companies, and so it goes on. It begs the question, in terms of Amendments 3 and 4, as to what the person faced with the sanctions envisaged here will do under the government amendments in particular. What is the nuclear option? What are the choices before the case is even heard, let alone when it is actually heard? What happens when a conviction occurs and is subject to an appeal?
This leaves potentially malevolent folk, if that is what they are—we assume that the ones who are rogues are malevolent folk and are appropriately labelled as such—still with the considerable ability to make mischief and make life a misery. Whether that is spitefulness, simply being manipulative, or whatever, I see great problems. That is one of the reasons why I am concerned for local government being handed this issue on a plate. There may be very uncertain outcomes that are extremely costly to unpick. Bearing in mind what I said a few minutes ago, I am not in favour of short-changing due process. There must be due process. I do not think we can tackle roguishness that borders on, or may actually be, criminality, other than by proper due process. We cannot have the rule of law being circumvented to catch these people; we have to play this by the rule book. That is the only way in which not to discourage the willing horses while at the same time squeezing out the malevolent types.
I see, as the noble Baroness, Lady Grender, sees, some serious structural difficulties in dealing with this in practice. We have in this Committee the skills set to unpick this and to consider the complications and ramifications.
My Lords, I support the Bill and welcome the following very clear measures to tackle the issue of rogue landlords that will strengthen the private rented sector.
Private tenants need additional reassurance that rogue landlords will be driven out of business, and banning orders for these criminal landlords and property agents is needed to prevent them operating and repeating serious housing offences. As a council leader, I believe that having the ability to apply for banning orders, together with fines, against rogue landlords and property agents is essential. This will prevent serious or repeat offenders, who are known to cause misery and harm to renters and place them at serious risk, from letting property. In such cases, there should be no room for these operators within the sector. I am pleased that the Government are determined to crack down on these landlords so that they either improve the service they provide or leave.
I also welcome the introduction of a much-needed database of rogue landlords and property agents. This will allow greater co-operation of local authorities around the country to keep track on banning orders and monitor ongoing trends. Having this national co-operation will, as I said, prevent serious or repeat offenders who are known to be causing misery and harm to renters and placing them at serious risk, from letting property, and there should be no room for these operators within the sector.
I ask the Minister to assure noble Lords that further government intervention against rogue landlords will happen and that she will collaborate with council leaders, like myself, in bringing a rogue landlord database to fruition as soon as possible.
My Lords, I support Amendments 2 and 7, and draw the Committee’s attention to my entry in the register of interests as a director of the Property Redress Scheme, one of the government recognised organisations.
Amendment 2, in the name of my noble friend Lady Grender, draws attention to the fact that this House and the other place do not consider legislation in a holistic fashion. We seem to consider one amendment to one piece of legislation without looking at the unintended consequences of that legislation, as identified by Amendment 2. Yes, we should address rogue landlords, however one describes them, but that will have an effect on the tenants of the relevant properties. The tenant who makes a complaint will have some protection in terms of getting rehoused, but the property may contain a number of tenants, including those who have not made a complaint against the landlord who is banned. If the property is no longer available for letting, those tenants will become homeless. My noble friend drew attention to the transfer of the relevant property to other people who are not specified in the Bill. What then happens to the tenants? We do not know that because we are not adopting a holistic approach to the legislation. The noble Baroness, Lady Gardner of Parkes, said that we do not have consolidation Bills. We have unintentional effects because of that.
Amendment 7 was spoken to by my noble friend Lady Bakewell. The problem is that we pass legislation without considering sanctions. The sanctions are to be imposed by local authorities, which are having their grants reduced and are looking for ways not to spend money rather than to spend it. Amendment 7 proposes that local authorities which are proactive in implementing the legislation should retain the relevant financial penalty. When the Minister replies, will she say whether the Government have had discussions with trading standards departments, environmental health departments and housing departments on how they will implement this part of the legislation to ban rogue landlords? I know of only one London borough—Camden—that has a really active trading standards officer dealing with housing, but the rest do not have the finance to cover this area. Therefore, I hope that some research has been carried out with local authorities in England to determine whether these restrictions will bite where they need to.
My Lords, I support Amendment 7. I appreciate what has just been said, but certainly my view is that one of the big problems with all these housing issues of overcrowding and everything else is that the local authorities cannot afford to implement the enforcement and inspection measures that are constantly necessary. Indeed, at a later stage in the Bill I intend to bring forward an amendment to enable them to charge more for planning applications for these enormously expensive huge underground developments which many people find very inconvenient. The person who applies for planning permission for a simple little underground development just to give their family more space pays the same amount as the person applying to build a multimillion pound development. That is very unfair. The proposed measure would enable local authorities to have a little more money to enforce their many obligations. This amendment is valuable in that respect.
I will speak to the amendments moved and spoken to by the noble Baronesses, Lady Grender and Lady Bakewell of Hardington Mandeville. We all know the reality. The reality is that local authorities will be picking up this responsibility because people will be advised by the homeless charities or whatever to go to the local authority, and the local authority will have to pay. The question is: who should ultimately pay?
It may be that the Government should take upon themselves the right to take a charge on the landlord’s property. I know it would be very controversial—I am sure the lawyers would have a field day—but it would mean that the local authorities would get their money back. I therefore put that as a suggestion, which the Minister might wish to pursue when we get to Report.
Government Amendment 4, in the name of the noble Baroness, Lady Williams of Trafford, deals with further offences by the person who committed a first offence. What about people who transfer their interest, so that the further offence is committed by the person to whom the interest has been transferred? Clause 26 deals with the “Prohibition of certain disposals”. Subsection (1) states:
“A person who is subject to a banning order that includes a ban on letting may not make an unauthorised transfer of an estate in land to a prohibited person”.
Subsection (4) describes a “prohibited person” as,
“a person associated with the landlord”,
or , under subsection (4)(f),
“a body corporate in which the landlord has a shareholding or other financial interest”.
Subsection (5) states that an,
“‘associated person’ is to be read in accordance with section 178 of the Housing Act 1996”.
In that section of the 1996 Act, I am told that an “associated person” is someone who is in a marriage to, or is a cohabitee of, or lives with, or is a relative of the landlord, or someone whom the landlord is about to marry, or who is a child of the landlord. Does this include relationships that have developed and are registered overseas? Many landlords will be operating from overseas, so we will have great difficulty identifying who the owner of a particular property is.
This brings me to the second point, which is about,
“a body corporate in which the landlord has a shareholding or has a financial interest”.
What about companies registered outside the United Kingdom? The landlord might be in some tax haven or in some other part of the world, which is perfectly respectable but where we do not have much access to information. I think these bodies need to be more clearly defined in the law, and I wondered whether the noble Baroness might wish to comment on that as a proposition.
My Lords, the amendments put forward give rise to a very simple, brutal question—I speak as somebody who is wrestling with trying to produce a council budget at the moment, in very difficult circumstances—and that is: how much is this going to cost local authorities? I have looked at the impact assessment, and basically it talks about the cost to the private housing sector—to the providers of private-landlord accommodation. Unless I have completely missed it, I cannot find any assessment of the cost to the local authorities, who will have the responsibility of doing all this. My first question is: have the Government made an assessment of this and, if so, will they tell us what it is?
The second thing I have been trying to apply my mind to is, in my own authority, how we will deal with this. The point about local authorities, of course, is that they are very different: there are large unitary counties, there are large metropolitan and other unitary urban authorities, and there are small districts. It is the housing authorities as a whole which will have to deal with this, including the small districts. The way the small districts may be able to cope is perhaps very different to that of a large authority that employs a lot more specialist staff, such as solicitors and property management people. I have, therefore, been trying to get my mind round how local authorities will actually make the decisions about applying to the tribunal for a banning order—who will make those decisions, how it will be done, how much it will cost, how much work will go into it—and dealing with appeals, because it is quite clear that there will be a lot of appeals, assuming that a lot of people go through the banning process.
Then there is the second decision. Apart from the people who have gone through the tribunal and automatically go on the database, there is a decision about whether to put the other people who have been convicted of banning offences on the database. How much time and resource will that decision take? Again, there is the question of appeals, which are never cheap for local authorities, and then there is the cost of maintaining the database itself: whether or not that is onerous depends on how many people there are on the database. My second question is really linked to how much the Government think this is going to cost local authorities—any answer to that must be based on an idea of how many cases there are going to be over the period of a year, or whatever it might be. Do the Government have any answer at all to those questions?
My Lords, at the start of the first day of Committee, and my first contribution at that stage, I should have declared that I am an elected councillor of the London Borough of Lewisham.
I join other noble Lords in concern about the lack of regulations available for noble Lords to see. Why does the Minister think that it is acceptable to bring forward a Bill in such a sorry state? Does she accept that it is wholly inadequate to suggest that the Government will consult fully and lay regulations months after the Bill has become law?
On Second Reading, and subsequently, I and other noble Lords from these Benches have welcomed the banning order proposals in the Bill. They will provide, we hope, an effective additional tool for local housing authorities to use against rogue landlords and persons engaging in letting agency or property management work who think that they can rip off tenants and treat them badly with impunity. With an ever-increasing number of people forced into the private rented sector, it is important that there are proper safeguards. Peter Rachman became synonymous with the rogue landlords of the 1960s. We want to ensure that we do not have any modern-day Rachmans, or, if we do, that they are dealt with effectively.
I also see the proposals in this part of the Bill as a first step to dealing with the issues in the private rented sector that make life difficult for tenants living at the poorer end of the market. The ward that I represent on Lewisham Council is typical of those that the Bill is aimed at: we have very little local authority housing other than a successful housing co-op, and until recently an overwhelming number of people there were owner-occupiers. However, there has been an explosion in the private rented sector in the last 10 years, for a variety of reasons. Most landlords are very good, with anything from one to a few properties. They often get into the market as a landlord because they have fallen into negative equity, have looked to move on but have been unable to cover their capital outlay. Many of those coming to my surgeries are now private sector tenants, invariably young people, both singles and couples, who cannot get any social housing because they are not in a priority group, cannot go on the housing list, cannot afford to buy and are left to seek refuge in the private rented sector.
When I was a member of Southwark Council in the 1980s, we had properties deemed hard to let—that nobody wanted to live in—and the council was able to let those to single people and couples who would not otherwise qualify for social housing. That category no longer exists. The amendment proposed by the noble Baroness, Lady Grender, in this group, has identified what is a significant omission from the Bill. The amendment has the full support of noble Lords on these Benches. After we have taken action against the rogue landlords, what happens to their tenants? These will be the very people who have suffered at the hands of the rogue landlord in the first place. It is right that the amendment should be in the Bill and not left to regulations, advice notes or any other procedure that does not involve it being clear in the Bill itself. If the noble Baroness, Lady Williams of Trafford, does not accept the amendments today, I hope that she will at least reflect on this proposal and meet with colleagues from your Lordships’ House to discuss this matter before we get to Report.
We also support Amendment 7, in the names of the noble Baroness, Lady Bakewell of Hardington Mandeville, and the noble Lord, Lord Palmer of Childs Hill. Following an enforcement action resulting in a financial penalty, it must be right that the money should be retained by the local authority and not be lost to the Consolidated Fund or some other place where money from these penalties goes and never returns.
The remaining amendments in this group are government amendments. Amendments 3 and 8 appear to correct drafting errors and make matters clearer. Amendment 4, to which my noble friend Lord Campbell-Savours referred, seeks to deal with the situation where a person convicted of an offence continues with the breach after conviction. I have an issue with this amendment. Does it go far enough when dealing with people who, at this stage, have no respect for the law, or where the tenants are again in a difficult situation? We may need to look at that further.
My noble friend Lord Beecham will ask more questions of the Minister when she moves her amendments. At that point, we may need to look at the issue further and bring an amendment back on Report.
My Lords, I shall answer the noble Lord, Lord Kennedy, first because I ran out of time in a debate the other day and I could not answer him fully. He will get first place on the housing list today.
The noble Lord referred to the regulations which other noble Lords have mentioned at length. I can only reiterate my desire to bring forward as much information as I can. In any event, as I outlined in relation to the previous amendment, none of the orders could be implemented until the regulations were in force. So the orders would not be retrospective; they would only be made after the regulations had gone through. However, I take his point and I will do my best to bring forward as much information as possible.
The noble Lord made a point about social housing being so much harder to obtain than previously for people who would seem to be on modest incomes. That is behind the Government’s priority of building homes for all types of tenure in this Parliament, but focusing particularly on the younger generation that he talks about who are increasingly left out of the housing market. He also asked whether I would meet with him and colleagues before Report and I will be happy to do so.
Amendments 3 and 4 amend Clause 20 so that a person who has been convicted of breaching a banning order and continues to breach the order after that conviction shall commit a further offence and be liable to a fine not exceeding one-tenth of level 2 on the standard scales for each day or part of a day on which the breach occurs. This would equate to up to £50 a day until the breach ceases The amendment also introduces a defence of reasonable excuse in relation to the further offence which will capture any cases where a person was genuinely not able to cease breaching a banning order following conviction because, for example, they were in hospital and therefore unable to manage their affairs to bring tenancies to an end. Rogues who continue to let out their properties despite being convicted for that offence will therefore not only incur punishment for the initial breach of the order but will continue to be punished for each additional day that they remain in breach of the order. This sends out a strong message that a breach of banning order will not be tolerated.
Amendments 5, 6 and 8 amend Clause 22 so that a person who has had a civil penalty imposed upon them for breaching a banning order as an alternative to prosecution, and continues to breach the order despite the first civil penalty, can have an additional civil penalty of up to £30,000 imposed for each period of six months or part of a six-month period in which the breach of the banning order continues. Rogues who continue to let out their properties despite having incurred a civil penalty for the breach will, therefore, be subject to additional civil penalties for continuation of the breach. This sends out the strong message that a breach of a banning order will not be tolerated and will ensure that the business model of rogue landlords is disrupted.
Turning to Amendment 2, tabled by the noble Baroness, Lady Grender, I totally acknowledge her point that a vulnerable tenant should not be made homeless through no fault of their own as a result of a banning order. However, as my noble friend Lady Redfern says, the Bill is focused on sanctioning rogue landlords, but not at the cost of innocent tenants. The Bill will prevent tenants being made homeless by providing exceptions to a banning order or by allowing a local authority to manage the property in place of a banned landlord.
Clause 15 provides that in deciding whether to make a banning order and what order to make, the tribunal must consider the likely effect of the banning order on anyone who may be affected by it, which clearly includes tenants. Provision has been made for a banning order to be subject to exceptions; for example, where existing tenancies are in place which the landlord does not have the power to bring to an immediate end, or to allow a letting agent to wind down their business. An exception could, for example, be made for a period of some months to allow tenants adequate time to find alternative accommodation.
The noble Baroness asked who the rent would be paid to and the noble Baroness, Lady Bakewell, asked about recompense, which are both valid questions. The use of management orders by local authorities is already established through the Housing Act 2004. Schedule 3 to the Bill extends the circumstances in which management orders may be made. It allows a local authority to make a management order in respect of any property owned by a landlord who is subject to a banning order. These orders, which would allow tenants to stay on in the property while it is managed by the local authority, are particularly likely to be made in areas of high housing demand. In such circumstances, the local authority will be responsible for managing the property and will retain all the rental income, which can be used for the local authority’s housing purposes. Because of this, local authorities will in future be incentivised to consider the use of management orders.
On Amendment 7, proposed by the noble Baroness, Lady Bakewell of Hardington Mandeville, as the Housing Minister set out in the other place, local housing authorities will be able to retain fines they receive as income. The Bill will enable local authorities to issue civil penalties of up to £30,000 and to seek rent repayment orders covering the previous 12 months. Councils will also be able to retain the money from civil penalties and rent repayment orders where the rent was paid from housing benefit or universal credit, and reuse that for housing purposes.
I have an amendment later on that refers to empty dwelling management orders, which do not work very well at the moment. If a local authority is managing a property because the owner of that property has a banning order, is it assumed that the only money the local authority can spend on the property, which may be severely substandard—that may be why the banning order is there, or may be related to it—is the money taken in rents, even if it is not sufficient to bring it up to standard? If so, do we accept that a local authority is managing a substandard property for a period of time and if not, where will the local authority get the money to put into that property?
I think that comes back to the point made by the noble Lord, Lord Campbell-Savours, about charges on properties. The local authority cannot in any circumstances of managing that property be out of pocket, but nor would the tenants be expected to live in substandard conditions. Therefore, any money that needed to be spent on the property could be recouped by a charge on the property. I think that answers the questions of both the noble Lords, Lord Campbell-Savours and Lord Greaves.
A further question has just occurred to me. We are assuming that we are talking only about a landlord and a tenant but of course, there may well be a mortgagee. What happens in the event that the council takes over the property? Is the council then responsible for paying the mortgage payments out of the money it receives and, if not, is the tenant not at risk of the mortgagee obtaining possession of the property?
My Lords, as far as I know, the mortgagee is responsible for paying the mortgage. If the rents do not cover the costs of any works that need to be done on the house, again, it comes back to the charge on the property in order to keep those tenants in the property for the agreed period of the tenancy. That is the way I think it would work, but I will confirm that in writing because I do not want to mislead noble Lords.
I wonder if the Minister can help me because I am now slightly confused. If the local authority is expected to use funds upfront to make repairs and bring a property up to suitable standards, and the only way it can recoup them is through a charge—whether a first or a second charge—is it not the case that that money can be realised to the council only when the property is sold, which may be a considerable time after the local authority has incurred the costs?
That might be the case. The point is that the local authority could recoup the costs. I think the premise of all the questions is the local authority not being out of pocket because of its obligations to the tenants. The noble Lord, Lord Greaves, is shaking his head so I will let him intervene.
I am grateful to the Minister for giving way when I was not asking her to. This is a new convention which perhaps we should adopt. I think the point that my noble friend Lord Foster of Bath was making is that it might be a very long time before the property is sold by the owner. It could be 50 years, by which time who knows whether local authorities will still exist? There appears to be no means by which the local authority is guaranteed to get its money back within the period of the banning order.
My Lords, I hope I made the point clearly that ultimately, the local authority will get its money back. That might mean that at the end of a tenancy the local authority could force the sale of a property in order to get its money back, but the point is that the local authority can get its money back. I guess if it incurred any interest charges over the period, it can claim those back as well. But such is the level of the civil penalty that local authorities should be in a fairly good position, using penalties and other things to service any housing costs they might have and to not be left out of pocket.
My Lords, I am trying to be helpful to the Minister. It would be extremely helpful if she could write to us all with some examples and figures showing how this might work in practice, both in terms of the procedure and some numbers, so that we can understand it—which we are not going to this afternoon, clearly.
While all this is going on, I am conscious that there is one very vulnerable tenant and one rogue landlord, who is getting angrier. What protection is there for the poor tenant left there while all this is going on? The landlord is not getting his rent or having his mortgage paid and the council is in there taking things over. I am wondering about the human issue.
My Lords, I do not have any particular concerns about the rogue landlord; I am concerned about the vulnerable tenant. That is why the local authority, or the managing agent of the local authority, is the protection for the tenant who, if they have been subject to the practice of a rogue landlord, might find it a light relief not to be treated in such a contemptuous way.
In terms of the charges on the property, I seek some clarification. We are told that the local authority may have taken over management of the property and be taking a charge on it, and will be able to underwrite its costs in one way or another, which seems very sensible. The problem is if there is an existing charge on the property because the owner has a mortgage on it. To seek recompense and take action, the local authority will have to take cognisance of the fact that there is already a charge on that property. A local authority may be very reluctant to incur the cost when it knows it is in a queue and may get nothing whatever at the end of the line.
My Lords, I would assume that in those circumstances the local authority would take a second charge out on the house. That is the assumption I would make in such circumstances.
Under subsection (7) the Secretary of State may make regulations specifying how financial penalties recovered under this clause are to be dealt with. Broadly speaking, we envisage that such sums could be used in connection with the authority’s private sector housing functions, but we will discuss the details of how the income is to be applied with relevant parties before making the regulations. We will consult on guidance, setting out the appropriate penalties to levy, and take into account a wide range of circumstances. Such guidance will also cover landlords’ right to appeal. Furthermore, we will issue local authorities with guidance on the utilisation of any money they receive through financial penalties.
I do not know whether I answered the noble Baroness, Lady Bakewell, and the noble Lord, Lord Greaves, about the new burdens. I have probably made my point, but any policy that could result in a local authority incurring costs is subject to a new burdens assessment. We have considered this test when developing this policy. It is not a burden as it is not a requirement to place someone under a banning order.
In answer to the noble Lord, Lord Palmer, on how local authorities will implement this policy, local authorities have warmly welcomed it because it will help them to crack down on the rogues and retain the income from civil penalties and rent repayment orders. It is important that noble Lords are satisfied that local authorities are very happy with this.
The noble Lord, Lord Campbell-Savours, mentioned the transfer of interest to a prohibited person when that interest is an overseas interest. It does not matter whether it is an overseas interest or whether it is in this country, the policy still applies, as I understand it.
The noble Lord, Lord Greaves, asked how local authorities would make their decision and how many cases we would have a year. Local authorities are likely to seek banning orders where the offence is particularly serious or where they have a repeat offender. We estimate that there will be about 600 banning orders per year. I hope my comments have reassured noble Lords, but I see that the noble Lord, Lord Beecham, is about to stand up.
I am sorry to add to the noble Baroness’s problems. However, I am slightly puzzled by the relationship between government Amendments 3 and 4, which apply to Clause 20, and government Amendments 5 and 6, which apply to Clause 22. Government Amendment 4 to Clause 20 specifies:
“Where a person is convicted … of breaching a banning order and the breach continues after conviction, the person commits a further offence and is liable … to a fine not exceeding one-tenth of level 2 on the standard scale for each day or part of a day”.
However, government Amendment 6 to Clause 22 states that,
“subsection (3A) allows another penalty to be imposed … If a breach continues for more than 6 months, a financial penalty may be imposed for each additional 6 month period for the whole or part of which the breach continues”.
Is that on the same basis or a different basis? I apprehend that the Minister may not be able to give me an answer off the cuff, but will she have a look at that—or get somebody to have a look at it—to see whether there is a relationship between those two positions, or whether they deal with different issues? At the moment, I am confused—which is not unusual. It may be perfectly simple but it does not look terribly simple from these two amendments.
My Lords, as I understand it, the second penalty is an enhancement of the first, so they are related. However, I think the first is a lesser penalty because it involves a first breach and the second is greater because it perpetuates the breach.
I am sorry to persist but that does not tell us the basis on which the relevant penalty would be calculated. It is clear as regards the criminal offence, if that is the distinction, but it is not clear whether the same way of calculating the penalty is used. I do not expect the noble Baroness to answer that today but if she could answer it in writing subsequently, that would be fine.
I thank all noble Lords for their contributions to this discussion and the noble Earl, Lord Lytton, for his support for continuing to examine this area. I also thank the noble Lord, Lord Palmer of Childs Hill, who raised property transfer and the noble Lords, Lord Campbell-Savours and Lord Greaves, for commenting on where the resource goes, about which we have already had much discussion. The Minister said that we would find some answers and reassurance for tenants in Schedule 3. We will continue to scrutinise this issue to make sure that there is absolutely no threat of a tenant being made homeless as a result of the activities of a dreadful rogue landlord. That is the main aim of this amendment and we will continue to review that as the Bill progresses. However, at this point, I beg leave to withdraw the amendment.
Amendment 2 withdrawn.
Clause 16 agreed.
Clauses 17 to 19 agreed.
Clause 20: Offence of breach of banning order
Amendments 3 and 4
3: Clause 20, page 11, line 23, leave out “this section” and insert “subsection (1)”
4: Clause 20, page 11, line 27, at end insert—
“(3A) Where a person is convicted under subsection (1) of breaching a banning order and the breach continues after conviction, the person commits a further offence and is liable on summary conviction to a fine not exceeding one-tenth of level 2 on the standard scale for each day or part of a day on which the breach continues.(3B) In proceedings for an offence under subsection (3A) it is a defence to show that the person had a reasonable excuse for the continued breach.”
Amendments 3 and 4 agreed.
Clause 20, as amended, agreed.
Clause 21 agreed.
Clause 22: Financial penalty for breach of banning order
Amendments 5 and 6
5: Clause 22, page 12, line 4, leave out “20” and insert “20(1)”
6: Clause 22, page 12, line 9, at end insert “, unless subsection (3A) allows another penalty to be imposed.
“(3A) If a breach continues for more than 6 months, a financial penalty may be imposed for each additional 6 month period for the whole or part of which the breach continues.”
Amendments 5 and 6 agreed.
Amendment 7 not moved.
8: Clause 22, page 12, line 13, leave out “20” and insert “20(1)”
Amendment 8 agreed.
Amendment 8ZA not moved.
Clause 22, as amended, agreed.
Schedule 1 agreed.
Clauses 23 and 24 agreed.
Schedule 2 agreed.
Clause 25 agreed.
Schedule 3 agreed.
Clause 26 agreed.
Clause 27: Database of rogue landlords and property agents
Amendment 8A not moved.
Clause 27 agreed.
Clauses 28 to 30 agreed.
Clause 31: Appeals
9: Clause 31, page 15, line 29, at end insert—
“( ) An appeal under this section must be heard within 28 days.”
My Lords, when I spoke previously I should have drawn your Lordships’ attention to my entry in the Register of Interests as a district councillor of South Somerset District Council and as a vice-president of the Local Government Association.
I will speak, in the first instance, to Amendment 9. I will then speak to Amendments 10, 12, 13 and 14. On Amendment 9, it is only fair and proper that those who have the prospect of a banning order being imposed on them should have the right of appeal. My colleagues and I are happy with the process laid down for dealing with appeals, with one exception. Both the landlord and his tenants, plus the local housing authority, will be in some uncertainty during the appeal process. Uncertainty leads to stress, and this will be extremely unwelcome for tenants, who are already fraught because of the situation in which they find themselves. The state of their accommodation may be less than we would wish, and they may have been threatened. They will want their ordeal to be finalised as quickly as possible. Likewise, the landlord will be waiting for the sword of Damocles to fall, and this could be unjustified, as we heard from the noble Earl, Lord Lytton, earlier. It is only fair and equitable that this uncertainty be as short-lived as possible for all concerned. That is why I have tabled this amendment, requiring the appeal to be heard within 28 days so that the decision is reached quickly and efficiently for the benefit of all concerned. I hope the Minister can agree to it.
Turning to Amendment 10, the register of rogue landlords is one of the most important steps forward in this Bill. Those of us who have been, or are still, councillors will know at first hand what misery can be caused by a tenant who has what is now classed as a rogue landlord. All housing department officers know who they are as the tenants of these landlords are frequently in their offices or on the phone complaining about the treatment meted out to them. The frequency of evictions by these landlords, or the sudden ending of tenancies, alerts officers to where they are and the properties that they own and run.
It is essential that a register of rogue landlords be set up which can be accessed by those agencies supporting their tenants. These agencies will be well-known, trusted deliverers of advice and support, including the local authority, the CAB, the DWP, jobcentres and possibly food banks. It is vital that tenants are also able to access this register if they are not to go from one poor landlord to another. It will always be the case that those who are the most desperate to find a roof over their head for themselves, their partner and perhaps even their children will be most at risk of being exploited. They need this information to assist them to make the right choices.
It is not as though the names of those who are likely to arrive on the register will not already be in the public domain. Local newspapers are full of court reports. Someone on the register is also likely to be engaged in other activities and will have come to the notice of police and local authorities. If they have previously held a licence for a HMO, that will have been reported in the local newspapers. I can understand that there are some sensitivities here, but we must protect tenants by allowing them access so that they can make value judgments. This is a freedom of information issue and I hope the Minister will be able to concede this amendment.
I turn now to Amendments 12, 13 and 14. As already said, it is important that all those who are operating in the private housing market are able to provide for and assist their tenants to have a secure and untroubled home. It is to no one’s advantage for people to be continually seeking alternative accommodation; to be moving within an area where they are currently living or having to move to a different area is stressful. This is especially true if there are children involved. Disrupting a child’s education as they are forced to move schools is very harmful and will set back their educational progress.
It is essential that tenants are able to access the register of rogue landlords so that, having moved from one such landlord, they do not fall foul of another operating in a similar type of accommodation. Let us not forget that the people and families looking for the accommodation which is likely to be provided by those on the register will have little choice because of their straitened circumstances. However, like everyone else, they deserve to be protected from exploitation.
As I have already indicated, the information on rogue landlords is likely to already be in the public domain through court proceedings and other avenues. I urge the Minister to consider these amendments and respond positively to them. I beg to move.
My Lords, I support the amendments moved by the noble Baroness. I have one query about Amendment 12, which removes a requirement for information disclosed from the database to be anonymous. It would be helpful if it were made clear that any information concerning a tenant would continue to be anonymous. It is not clear whether there would be any information about a tenant revealed or recorded but, to be on the safe side, such a tenant should not have his or her details revealed. That ought to remain guarded by anonymity.
This group of amendments addresses a large range of issues designed to facilitate dealing with the problems occasioned by rogue landlords. Amendment 15 specifically bars any landlord on a database of rogue landlords from obtaining a house in multiple occupation licence. It would be good to have that in the Bill.
The background to this group and much of what we are discussing today in the Bill was set out recently in disturbing statistics produced by Citizens Advice in its response to the welcome funding by the Department for Communities and Local Government to tackle the problem on the ground.
I am bound to report that a grant of £80,000 has been received to be applied in the ward that I represent on Newcastle City Council, in an area just half a mile away from the new properties that the noble Baroness visited recently. We got a selective licensing scheme for that area—eventually; it was not easy to obtain. About a third of the landlords in the area were clearly not conforming to the requirements. I am glad that we have received this funding to enable us, as a council, to pursue matters.
However, there are still too many properties in the hands of bad landlords who continue to fail to look after their properties, and indeed their tenants, properly. Given the lengths to which councils have to go to establish such schemes for selective licensing, this is particularly objectionable. The national picture is a cause for great concern. There are apparently 700,000 tenants—which probably means about 2 million people in all, if we add family members and the like—including 500,000 children, living in unsafe properties with exposed wiring, leaking roofs and even rat infestation. There are some 740,000 rented homes that constitute a threat to the health of residents, and apparently 80,000 tenants are faced with threats of retaliatory eviction because they seek repairs. Again, that probably affects around 200,000 people, with a particularly high proportion of properties in London—some 14%, it is said—falling into this category. This especially affects residents from a BAME background.
There is therefore a great deal to be said for strengthening the role of local authorities in overseeing the sector, and also in fulfilling this part of the Bill, in allowing and promoting tenants’ access to information about the owners of the properties that they seek to rent. Anything that can be done to bring pressure to bear on such owners to behave responsibly is welcome, and I hope the Minister will feel able to accede to the amendments tabled by the noble Baroness, and to my own amendment relating to the consequences with regard to HMO licensing.
My Lords, my noble friend Lady Bakewell spoke to these amendments fully and explained them very well, and we all wait with interest to hear the Minister’s response. We should recognise how important the issues that they raise are. My name does not happen to appear on Amendment 9—I am not quite sure why—but I certainly support it. We do need some sort of indication—I think 28 days is entirely right and appropriate—of how soon an appeal on matters that are so important and sensitive for both the tenant and the landlord will be heard. We are only too aware of other types of appeal that wait not just for months but for years. For an appeal to be heard within 28 days seems to me entirely reasonable.
The other amendments deal with another important point: exactly who will have access to the information in the database? Surely it must be right for the tenants to have a right of access to that information. Whether it is appropriate to put that in the Bill or in the draft regulations we wait to hear—but we have heard enough about the regulations already while debating this Bill, and we think that it should be on the face of the Bill. I hope that when the Minister replies she will, at the very least, agree with the point being made here. We can then argue about where the provision is to be placed. We look forward to the Minister’s reply; I hope it will be a positive one, recognising the importance of these issues.
My Lords, I firmly support Amendment 9, moved by the noble Baroness, Lady Bakewell of Hardington Mandeville. It is a very sound amendment.
Clause 29 refers to a power to include a person convicted—that is, convicted in a court of law—of a banning order offence. Then it says in a subsection:
“A local housing authority in England may make an entry in the database in respect of a person who has, at least twice”—
not once, twice—
“within a period of 12 months, received a financial penalty in respect of a banning order offence committed at a time when the person was a residential landlord”.
We are talking here about a habitual offender. In Clause 32 the Government set out what can be on the database. Let us go through the list, because that list should be available to the general public for the reasons set out by the noble Baroness, Lady Bakewell, when she referred to freedom of information. First, there is the period for which the entry is to be maintained: why should that not be available to the tenant or tenants? Details of properties owned, let or managed by the person: why should they not be in the public domain when the matter has been dealt with in the courts? Details of a banning order offence of which the person has been convicted in a court of law: why should that information not be made available to the tenant? Details of any banning orders made against the person, whether or not still in force: why should tenants not know the background of their prospective landlords? Also on the list are “details of financial penalties” received by the person.
Finally, I return to the first item in the list: the person’s address or other contact details. One would have thought that a tenant should at least have the right to know who their prospective landlord is, where they live, and their contact details. I put it to the Minister that the Government are a little oversensitive about this. They should reconsider this area and think about what is in the public interest. Who is going to lose as a result of this? The local authority does not lose; the tenant does not lose; only the landlord who has been convicted of a criminal offence loses. I ask the Minister to reconsider the position.
My Lords, I shall speak to Amendment 16 in my name in relation to Clause 38. Amendment 16 would mean that for the purposes of paragraph 17 of Schedule 23 to the Finance Act 2011, the database will be treated as being maintained by the Secretary of State, although Clause 27 sets out that local authorities have responsibility for maintaining its content. This will ensure that HMRC is able to access the database, using its powers under the Finance Act 2011, so that it can use the data in discharge of its tax functions when dealing with rogue landlords and property agents.
I thank the noble Baroness, Lady Bakewell of Hardington Mandeville, for speaking to Amendment 9. While appeals, and not just appeals about entries on the database, should be dealt with without undue delay, it is not appropriate to set out in primary legislation strict time limits for doing so, because it may not be practical or reasonable to do so. The tribunal has a wide range of powers to ensure that cases are dealt with fairly and justly. It can award costs against vexatious litigants whose only purpose in appealing is, for example, to delay their entry on the database or to cause further expense to the local housing authority. It can also prioritise cases that it considers urgent and refuse adjournments when there is no good reason for the request. In general, however, when the appeal is not vexatious in nature, how quickly it can be disposed of will ultimately depend on its complexity and other factors, such as the representations that the parties intend to make. Indeed, other factors can lead to delay, such as the illness of a party or a representative. It would be manifestly unfair if representations could not be accepted outside 28 days when there is genuine and good reason for doing so because the law has said that the appeal must be heard within that timeframe, regardless of circumstances.
I turn to Amendment 10. Landlords and property agents included on the database will have either been convicted of a banning order offence or received two or more civil penalties, as an alternative to prosecution, for serious breaches of housing legislation. I appreciate the feelings of noble Lords on this issue. It is not intended that all those included on the database should be banned from operating their business, but banning orders would be sought for the very worst or repeat offenders. Banning order offences will be defined in secondary legislation but are likely to include a serious offence. This is where an offender has been convicted in the Crown Court of an offence involving fraud, drugs, sexual assault or violence that is committed in, or in relation to, a property that is owned or managed by the offender or which involves, or was perpetrated against, persons occupying such a property. It would also include any serious offence involving violence against the tenant by the landlord or property agent, and serious breaches of housing legislation.
Amendment 11 would allow tenants and prospective tenants to petition their local housing authority to gain access to the database of rogue landlords and property agents. Doing so would effectively blacklist those landlords and agents on the database and put them out of business. This is not the intention of our legislation. The database aims to enable local authorities to keep track of rogue landlords and agents and target their enforcement action more effectively. Where a local authority believes a landlord or agent should be prevented from renting out or managing property, it should seek a banning order.
Noble Lords, and particularly the noble Baroness, Lady Bakewell, asked whether the public or tenants will have access to the database. The database will hold details of landlords and property agents who have been convicted of certain offences. Just because a landlord or property agent is on a database does not mean that they are banned from letting out a property—that would require a banning order. Making the database publicly available could raise data protection issues. However, the Secretary of State can give information held on the database in an anonymised form for research, statistical or monitoring purposes. The noble Lord, Lord Beecham, asked about tenants’ details. These will never be disclosed. The noble Baroness, Lady Bakewell, also asked about the effect of putting a landlord or property agent on the database. A database will enable a local authority to keep track of the landlords or property agents who have been convicted of a relevant offence and who may seek to move to a new area to avoid detection and attract new tenants. It will also enable them to obtain details about other rental properties owned by the landlord. In some cases, a local authority may decide to monitor a landlord or property agent on the database before deciding whether to apply for a banning order.
Information on the database will be made more widely available in an anonymised form. In addition, where tenants raise concerns about their landlords failing to take action over property conditions, local authorities can carry out an inspection, using the housing health and safety rating system introduced in the Housing Act 2004, and take appropriate enforcement action.
Where a local authority believes that a landlord or property agent should be banned from being involved in renting out or managing property, it should apply to the First-tier Tribunal for a banning order. Banning orders are intended to be used for those landlords and property agents who are particularly serious or prolific offenders, and who represent a real risk to the health and safety of prospective tenants. Local authorities have been provided with strong enforcement tools to ensure that, once a banning order has been made, it is not breached by the offender.
Amendments 12, 13 and 14 would require the Secretary of State to make information on the database of rogue landlords and property agents accessible to everyone and provide that the purposes to which the data may be put include the protection of tenants. As I have said, making the database publicly accessible would effectively drive anyone on the list out of business—which is not the purpose of the database.
Finally, Amendment 15 would require local authorities to automatically bar landlords on the database of rogue landlords from holding an HMO licence. As I have said previously, the purpose of the database is not to ban landlords and property agents from operating. The idea is to enable local authorities to monitor rogue landlord activity and effectively target enforcement action. The noble Lord, Lord Beecham, mentioned retaliatory eviction. We legislated through the Deregulation Act 2015 to stop the practice of retaliatory eviction, a move that has been much welcomed by Shelter.
I hope I have explained enough to enable the noble Baroness to withdraw her amendment—
My Lords, I thank noble Lords who have taken part in this short debate. I am very grateful to the noble Lord, Lord Beecham, for mentioning the anonymising of tenants’ names on the list. It is very important that their names should not be released.
I cannot pretend that I am anything other than disappointed with the Minister’s response. It is very important that the appeals are heard in a timely manner and I think 28 days is a reasonable time in which to hear an appeal. In other parts of the Bill we shall come to issues of abandonment, where there are very definite timescales that people must abide by. So I find it somewhat strange that we cannot have a timescale for hearing the appeals. This may be something we wish to return to on Report.
With regard to the list of landlords being anonymised and not released to tenants, I cannot see the point of holding a list if it is be anonymised. That seems somewhat perverse. Tenants should have access to the list and should be able to see whether their landlord is on the database. I accept that rogue landlords will be on the database when they may not have a banning order. I understand that difference but, nevertheless, these are not the kinds of landlords we wish to promote. The Minister has indicated that she does not wish to drive rogue landlords out of business, but what of the good landlords? There are hundreds and thousands of responsible landlords operating their properties for the benefit of their tenants and just one or two rogue landlords are in danger of giving other landlords a very bad name. We should be able to name and shame these rogue landlords.
However, I understand the Minister’s view. It is possible that we may return to this but I will withdraw my amendment.
May I revert to my Amendment 15 about the HMO licence? I do not understand the logic of the Minister’s position. If a landlord is described as a rogue landlord and is on the database accordingly, why should that not operate as a bar to obtaining a licence for a house of multiple occupation?
Amendment 15 would prevent a landlord on the database of rogue landlords obtaining an HMO licence, which seems perfectly logical. The Minister appeared to reject the idea; I cannot think why. If she cannot for the moment remember why she did, perhaps she could communicate her thoughts later.
I rejected the amendment because the purpose of the database is not to ban landlords and property agents from operating but to enable local authorities to monitor rogue landlord activity. It is crucial to give local authorities the freedom to make judgments regarding the licensing in their area, just as they do in other forms of licensing, so it does not necessarily follow that a rogue landlord should be banned from holding an HMO licence. Although a local authority may make the judgment that they should be banned from having such a licence because of their activity, it does not necessarily follow.
My Lords, is it your Lordships’ pleasure that the amendment be withdrawn?
Amendment 9 withdrawn.
Debate on whether Clause 31 should stand part of the Bill.
The landlord who is on a database of rogue landlords has not necessarily been banned but may have had a civil penalty. So it is up to the local authority, when coming to a judgment about an HMO licence and in the light of the information that it has, whether that landlord will be banned from holding one. It may decide on balance that he or she will be, because they are such a rogue, or they may have had one civil penalty and it might therefore grant him or her a licence.
Clause 31 agreed.
Clauses 32 to 36 agreed.
Clause 37: Access to database
Amendments 10 and 11 not moved.
Clause 37 agreed.
Clause 38: Use of information in database
Amendments 12 to 15 not moved.
16: Page 18, line 21, at end insert—
“(5) For the purposes of paragraph 17 of Schedule 23 to the Finance Act 2011 (which relates to HMRC data-gathering powers), the database is to be treated as being maintained by the Secretary of State.”
Amendment 16 agreed.
Clause 38, as amended, agreed.
Clauses 39 to 51 agreed.
17: After Clause 51, insert the following new Clause—
“Extension of the Housing Ombudsman to cover the private rented sector
(1) The Secretary of State shall by regulations introduce a scheme to extend the Housing Ombudsman Scheme, as set out in section 51 of and Schedule 2 to the Housing Act 1996, to cover disputes between tenants and private landlords relating to properties within the area covered by the Greater London Authority. (2) The scheme under subsection (1) shall—(a) come into effect within 6 months of the passing of this Act; and(b) last at least one year and no longer than two years.(3) The Secretary of State shall, within three months of the closing date of the scheme, lay before each House of Parliament a report on the scheme under subsection (1), alongside any statement he thinks appropriate about the extension of the Housing Ombudsman Scheme to the private rented sector.(4) The Secretary of State may by regulations extend the powers of the Housing Ombudsman Scheme as set out in section 51 of and Schedule 2 to the Housing Act 1996, to cover disputes between tenants and private landlords throughout England.”
My Lords, Amendment 17, which is in my name and that of my noble friend Lord Beecham, seeks to extend the services of the Housing Ombudsman to the entire private rented sector. Following a successful pilot scheme in London, the Government decided to proceed in that manner. Ombudsman services are available for a variety of matters. They have proved highly effective and seek to resolve complaints having investigated the issues at hand independently and in a less confrontational way than proceedings in court can be.
At present, the Housing Ombudsman provides ombudsman services to housing organisations that are registered with it. The service is free, independent and impartial. It has two classes of membership: a mandatory membership, which includes all bodies registered with the Homes and Communities Agency; and a voluntary membership, which includes landlords and letting agents in the private rented sector who want to provide a good service to their tenants and who also have, and wish to retain, their good reputation.
My amendment seeks to extend the service on a trial basis to cover all disputes between landlords and tenants in the private sector in the Greater London area. It provides that the trial would last for between six and 12 months and that subsequently, within three months of the ending of the trial period, a report must be laid before Parliament with any statement the Secretary of State thinks appropriate about the extension of the scheme. That could be anything from welcoming the trial and extending the scheme to concluding that it was not a success and ending it there. The Secretary of State has complete flexibility in this regard. If it is deemed to have been a success, we have also included in subsection (4) of the proposed new clause the power to extend the scheme to cover the whole private rented sector in England. This is a sensible and proportionate measure and amendment, which I hope will receive a positive response. I beg to move.
My Lords, we are being asked in this amendment whether we think there is a need for further protection for tenants in the private rented sector. I suspect that I can guess the Minister’s response, although I hope I will be proved wrong. The Minister will point out that there is already a large amount of legislation to protect us from—I hesitate to use the phrase—“rogue landlords” and that further strengthening of that is to come, and that there is protection as regards retaliatory eviction against people who run “beds in sheds”. The Government’s own website lists a large number of tenants’ rights, which include the rights to,
“live in a property that’s safe and in a good state of repair”,
to have your deposit protected, to,
“challenge excessively high charges, know who your landlord is, live in the property undisturbed, see an Energy Performance Certificate … be protected from unfair eviction and unfair rent”,
and to have a written agreement if the tenancy term is fixed for more than three years. The Minister will no doubt point out, rightly, that some councils already have an accreditation scheme; she will point to the excellent Private Rented Sector Code of Practice that was developed on behalf of the Government by the Royal Institution of Chartered Surveyors back in 2014. She may talk about the trade bodies that many residential landlords associations have, and as a fallback she will also of course refer, rightly, to the county court mediation service.
On first sight, given that long list, it may appear that there is no need for further protection for tenants in the private rented sector. However, noble Lords will be aware that in a number of the areas I have referred to there are ongoing problems. For example, after the list of rights that appear on the Government’s website, a section then tells you what to do if you feel that you are not able to exercise those rights. It suggests that you should first complain to the landlord; failing that, you should complain to one of the recently set up “designated persons”—that is, an MP, a councillor or one of the various tenant panels; and finally, if all that fails, you should go to your local council. Notwithstanding the responsibilities in some areas—but not all—that local councils have, as most noble Lords will be aware, many councils simply do not have the resources and expertise sufficiently to deal with the wide-ranging types of complaints that will and do come forward. The county court mediation process has of course been successfully used on a number of occasions, but there is a problem, due to various legal arguments as to whether private sector landlords are defined as “suppliers”. Can the Minister tell us whether, if landlords are not defined as suppliers, that particular problem means they will fall outside the remit of that mediation service?
Even though the private rented sector code of practice is excellent, it has no teeth. Earlier this morning I talked to somebody at the Residential Landlords Association, which is one of the signatories to that code of practice. It says that although it is a signatory, it has no ability to enforce it. It is of course also worth reflecting that the vast majority of the maybe 2 million landlords are not even signatories to the code. On that point, nobody is entirely sure what the figure is for the number of private sector landlords, whether in England or across the whole of the country. Can the Minister help? I have looked everywhere to try to get a figure but cannot get any clear, precise figure from anywhere beyond that figure of around 2 million.
There are a number of ways we could move forward instead of accepting this amendment. The most effective is to make the code of practice to which I have referred a statutory code, and I am aware that there have been discussions within government about the possibility of doing that. Have those discussions taken place and are the Government likely to come forward with a proposal to make it statutory? If so, we would have a fairly powerful tool instead of the proposal in the amendment before us. We have got pretty clear evidence that, unless the code is made statutory, with all the appropriate ways of making it work in that state, there will be concerns about whether the many forms of protection are collectively sufficient.
However, before I can be finally persuaded that this is the right way to proceed, I would be grateful if the noble Lord, Lord Kennedy, clarified some aspects of the proposal, as the Committee will need to have confidence that there is in fact going to be a Housing Ombudsman as such. The Committee will be aware that the Government recently consulted on the idea of having a single public sector ombudsman, bringing together the Housing Ombudsman with the Parliamentary and Health Service Ombudsman and the Local Government Ombudsman services. During that consultation, there was a loud outcry from many of the respondents about the idea of incorporating the Housing Ombudsman within a single public sector ombudsman. I was pleased that the Government made it clear in their response to the consultation that they intend to start by combining the Parliamentary and Health Service Ombudsman and the Local Government Ombudsman, and not include within that the Housing Ombudsman. However, rather ominously, the consultation response goes on to say that they will establish that combination “in the first instance”, providing,
“a framework that allows others to join over time”.
The Committee will be interested to hear from the Minister the Government’s thinking on the slightly longer-term situation for the Housing Ombudsman. Clearly, if it is going to change, that will create a problem for this amendment.
There is also the issue of the resources needed to operate the scheme proposed in the amendment. At the moment, the Housing Ombudsman deals with roughly 5 million housing units, with a staff of 55 people. In the last financial year, they have seen a 28% increase in the number of complaints, so there is quite a lot of pressure on them, although they have helped to achieve a solution to that by providing a lot of support and help —on which I congratulate them—for local resolution. But if we take the current figure of 5 million housing units and add a further 3 million, which is roughly what would be required, clearly, that would place a significant additional load on the Housing Ombudsman. I would be interested to know what solution the proponents of the amendment have thought of for funding it.
The Housing Ombudsman is funded by levying a charge per housing unit. Because of increased efficiency the ombudsman has been able to reduce that charge, which is now—this may surprise many noble Lords—down to just 96p per individual housing unit. If we added to the scheme all private rented sector landlords, the vast majority—72%—of whom have only one property, and if the funding regime remained the same, in order to collect an appropriate amount of money, the Housing Ombudsman would have to find a mechanism for raising 96p from something like 1.5 million individuals. Clearly, that does not make a great deal of sense.
I have some concerns about some of the details, but broadly, I think the level of protection for tenants in the private rented sector is still not strong enough. We need to do something. We have before us one possible solution. The alternative could be to make the code statutory. I look forward with great interest to the Minister’s response to this proposition.
My Lords, this is an interesting proposal and if it is introduced, leaseholders too should be included. There are 6 million leaseholders, who in the past could have gone to a leasehold valuation tribunal for a very reasonable cost, but who now have to go to the First-tier Tribunal, which is much more expensive. There are many things that could be resolved by applying the ombudsman scheme. I would like to hear more about how this would work, and also—perhaps at a later stage in the Bill—to look at the possibility of including leasehold properties.
My Lords, I support the amendment, because I think there is a real issue here. Speaking as a former local authority leader—many people in this House are either former or current local authority leaders—I had three ombudsman judgments against me, of which two were correct and one, in my view, was not. That was over about 25 years, and most were associated with planning issues.
Throughout all my ombudsman experience, both in this sector and in the health service, the issues were between the ombudsman service and a publicly accountable body, such as a local authority or a health authority, in which there were members concerned to maintain the reputation of that authority, and to respond, if not precisely to the ombudsman’s proposals—the ombudsman had no enforcement powers—at least in a positive way. The ombudsman had no powers to make us do anything, but people would respond positively by trying to address the problem and see whether it was largely procedural or whether policy needed to be changed in some substantial way. That was because the ombudsman was overseeing a public organisation that had a reputation, with trustees, councillors and so on, who were accountable for their decisions in public, in the press.
If the Minister cannot support an amendment like Amendment 17, I hope that she will tell us how she would apply that same degree of scrutiny and enforcement to rulings against rogue landlords. There is a real issue here. Local authorities will respond, even if they cannot go all the way, but a private individual, knowing that the ombudsman has no statutory powers of enforcing a decision, may decide to go in a different direction and weather hostile criticism. Can the Minister help us by telling us in what ways the Government would ensure that the naming and shaming effect of ombudsman practice could apply in the private sector?
My Lords, I declare my interest as the chair of the council of the Property Ombudsman, and so I am on familiar ground. As chairman of an ombudsman scheme, I am very much in favour of the principle of having ombudsman services. They save having to go to court, spending a lot of money and being at loggerheads for longer. If one can resolve matters through the mediation services that, in effect, an ombudsman provides, it can be beneficial to everyone. I am also familiar with the Housing Ombudsman scheme because it is the body to which people take their complaints if they are tenants of housing associations and local authorities. I have had responsibility for housing associations and, like the noble Baroness, Lady Hollis, I have had judgments against my organisation for, hopefully, rather trivial matters. The Housing Ombudsman has a very good reputation and is doing a very good job. It is sorting out many complaints and provides a good model for ombudsman-ery.
However, in the circumstances of both the Property Ombudsman, who looks after complaints from estate agents, letting and managing agents and corporate bodies, and the current Housing Ombudsman scheme, which looks after the mostly responsible local authorities and housing associations, one is in completely different territory to the 1.8 million individual private landlords. I see severe practical difficulties in applying the principles of ombudsman-ery—which require you to deal with a corporate entity, a body whose reputation needs protecting and who has a great deal to lose from the process—to the 1.8 million individual landlords, which, I say to the noble Lord, Lord Foster, is perhaps the current figure, 72% of whom have just one property.
It is extremely expensive if one gets bogged down in an individual dispute. Cases which involve the Property Ombudsman in dealing with disputes between agents and tenants who complain to us can sometimes go on for a very long time. However, the agents will try to get matters sorted: they will have their own complaints procedures and will work things through. They will show a willingness to go with this and, at the end of it, when we make an award—if we do make an award—against the agent, then the agent will pay up. We have sanctions if they do not.
When dealing with individual landlords, who sometimes do not have an office or an address and do not reply, these disputes can run and run and be extremely expensive to administer. This, I am afraid, is a criticism of having a system which has 1.8 million landlords looking after the properties. The practical difficulties of simply applying the ombudsman system to all private landlords are enormous. I suggest that if one were to have a pilot scheme to test out whether one can apply ombudsman principles to this sector, it would be a good idea to go with the corporate entities first. These landlords are private companies and have status. There is therefore an opportunity for legal processes to be brought into play if they do not pay up on awards and so on.
Forget the great mass of individuals for the moment because they could be expensive. I am afraid 96p per landlord will not do it because if tenants and landlords get into a dispute it can be ongoing. Even when one is half-way through trying to fix a dispute the landlord/tenant relationship can break down again on a new issue and the case could run and run. It is a big undertaking. So, to start with, I would stick with the corporate entities.