Report (3rd Day) (Continued)
78A: After Clause 90, insert the following new Clause—
“Reducing local authority influence over private registered providers
(1) The Secretary of State may by regulations make provision for the purpose of limiting or removing the ability of local authorities to exert influence over private registered providers through—(a) appointing or removing officers of private registered providers;(b) exercising or controlling voting rights.(2) The regulations may in particular—(a) limit the number of officers that a local authority may appoint;(b) prohibit a local authority from appointing officers;(c) confer power on a private registered provider to remove officers appointed by a local authority;(d) prohibit a local authority from doing things that would result in it obtaining voting rights in a private registered provider;(e) require a local authority to take steps to reduce or get rid of any voting rights that it has in a private registered provider. (3) Regulations under this section may override or modify any contractual or other rights (whenever created) or anything in a private registered provider’s constitution. (4) Regulations under this section may—(a) confer a power to amend the constitution of a private registered provider in consequence of provision made by the regulations;(b) make provision about the procedure for exercising that power.(5) In this section—“appointing”, in relation to an officer, includes nominating or otherwise influencing the selection of the officer;“constitution” includes rules;“local authority” has the meaning given by section 106 of the Housing Associations Act 1985;“officer”, in relation to a private registered provider, has the meaning given by section 270 of the Housing and Regeneration Act 2008;“private registered provider” means a private registered provider of social housing.”
My Lords, I think we are all agreed that it is imperative that housing associations have the freedom to continue to deliver our country’s much-needed homes. Classification back to the private sector provides them with the ability to access private finance to allow them to continue with their development. These amendments support this aim. Amendments 78A and 133B seek to reduce local authority control over housing associations. The amendments have one aim: to enable the removal of housing associations from the public accounts. As noble Lords will know, the Office for National Statistics took the decision to reclassify housing associations as public bodies, meaning that £64 billion was added to the national debt and the housing association sector was classified as public in the national accounts. Local authority control over housing associations was not one of the reasons why the Office for National Statistics reclassified the sector last year. However, we believe that certain governance arrangements may be seen as public sector control and could jeopardise the reclassification of housing associations.
I would briefly like to set the scene. Housing associations build around 40% of new homes each year and provide 2.7 million homes for around 5 million people, including for our most vulnerable households. Building new homes and helping people meet their aspirations for home ownership cannot be achieved without access to private finance. I shall now turn to the details of these amendments.
Amendment 78A relates to the rights of local authorities to nominate housing association board members and act as shareholders. This could allow local authorities, in a minority of housing associations, to block major constitutional changes. Such arrangements are typical in organisations which hold stock that was previously owned by the local authority. Housing associations’ constitutions and the way they are run differ between organisations. Officials in the Department for Communities and Local Government are considering these governance arrangements to assess whether they constitute public sector control. This work is continuing, with the expectation of bringing forward regulations in the autumn. It is for this reason that my noble friend the Minister is seeking secondary powers for the Secretary of State to reduce local authority control over housing associations, where it exists. The final content of these regulations will be informed by the work being undertaken by the Department for Communities and Local Government. Through Amendment 133B, such powers will be subject to the affirmative procedure, so both this House and the other place will have an opportunity to scrutinise the detail of the proposed measures.
These amendments will not impact on the core objectives of housing associations. We are making these changes to ensure that the Office for National Statistics can move housing associations back to the private sector, where they belong. It is vital that housing associations continue to develop much-needed homes and fulfil their social objectives. To do this, access to private finance is essential. If we do not act now by taking this provision, there is a risk that some housing associations will remain on the public balance sheet. I commend these amendments to the House.
My Lords, I should repeat my declaration from last week that I am a vice-president of the Local Government Association, because this impacts directly on local government. I welcome Amendment 133B, which confirms that we will have the affirmative procedure so that we can at least talk about the proposals that the Government finally come up with.
I want to be really clear about two things. The first is that the purpose of these amendments is, ultimately, to ensure that we build more social homes for rent than we otherwise would because of the powers of housing associations, particularly in terms of borrowing. Secondly, although local authorities will not have as much control as they do now, nevertheless, there is nothing in the legislation as now proposed that will prevent officers or members of a council joining a housing association board if invited to do so directly in their own capacity. That is my understanding of what is proposed, but I am very keen that the Minister should make it absolutely clear when responding to this group of amendments.
My Lords, I very much agree with the points made by the noble Lord, Lord Shipley. Obviously, I welcome what my noble friend said: that there will be a good amount of time given to consider this rather new proposal. I understand the rationale in terms of the audit rules. However, I would like to make three points, one of which the noble Lord, Lord Shipley, has anticipated. It surely cannot be the case that a member of a local authority should be excluded by that from using his or her experience in the service of housing interests—although, clearly, under subsection (1)(b) of the proposed new clause they would not be able to exercise any voting right. Recent legislation dashed local authority members’ hopes when they were told that they were not allowed to have pensions any more because they were not employees of local authorities. In those circumstances, clearly they are not employees of the local authority. Therefore, I do not think that that should be used to exclude them from potential membership where that is judged useful by the housing association.
My second point is on the wording, which, again, is relatively new to all of us, and therefore I have not been able to take advice from my office, which I will when I have time. Subsection (5) of the proposed new clause states that appointing, in relation to an officer,
“includes nominating or otherwise influencing the selection of the officer”.
Local authorities that are responsible for housing individuals, and even those authorities that are not directly housing authorities, have a public responsibility to house effectively. In the course of that experience they will accumulate a great deal of knowledge about the local housing market, the capacity of individuals and, in some respects, the record of individuals. That wording—
“otherwise influencing the selection of the officer”—
could exclude the capacity of the local authority to offer advice on whether a person who has been put forward is an appropriate or effective person to carry out these very important functions.
That relates to my final point: accountability. A great deal in the Bill is about putting housing associations on one pedestal and local authorities and others on another. There has to be some recognition that the housing function is an important one for which local authorities have responsibility. I do not happen to think that putting councillors on boards is necessarily the best way of doing it. Indeed, I agreed to the removal of councillors from the board of our own major housing association. However, as we tease out what these proposals mean, particularly where there is a move from the local authority sector to the housing association sector, I hope we will not lose some thought as to the way in which relationships between housing associations and local authorities are sustained, and in which there is an element of mutual accountability between the two. Clearly, if this goes through, that may not be by appointment, but there must be some consideration of that point, in my submission.
My Lords, I shall speak briefly in support of the amendment and in doing so repeat my interests as chair of Peabody and president of the LGA.
I am a passionate advocate of close links between housing associations and local authorities. There is a huge amount of close working that they can and should do together, not just on housing but on issues to do with employment and social care. I also agree with the noble Lord, Lord Shipley, about the need for housing associations to be open to review and scrutiny, and for debate with local authorities about what they are doing in their local area.
As I understand it, this is a very specific issue that relates to the classification of housing associations and how we move from the current—I think, by common consent—unsatisfactory position whereby they are classified as public bodies to one where they return to being classified as private bodies. The issue here is about nomination and therefore the implication of some level of control, rather than participation that might come through the normal routes of filling board membership of housing associations. Therefore, it is not an issue that should in any way prohibit housing associations having local authority members or officials on their boards, but the process by which they become board members would be more in line with those processes for other board members. It is unfortunate that the measure has come this late, but I think that it is an inevitable consequence of the negotiations that are going on with the ONS and it is the direction of travel we need to go in.
My Lords, perhaps I may seek clarification that we are talking only about nominations to boards of RSLs and not nomination rights over where the tenants who occupy their homes come from. All those homes that were transferred under LSVT were transferred on the basis that the host council which decided to transfer would maintain its nomination rights. I appreciate that the noble Lord, Lord Kerslake, is slightly conflicted by having to take an LGA position and an RSL position which are completely opposed to one another on this issue, but sometimes we all have to be Janus-headed.
My concern is not about who sits on the boards, because I think the RSL experiment has failed and I am not sure how many councils would want to be associated with it, but about the loss of nomination rights. Those LSVT units were all taken out of council control; they are not private sector homes—or they were not when they left. The Labour Government who did the transfers assured everybody that they were not being transferred to the private sector. If we are now saying that they are, we must at least honour the agreements under which they transferred. While I will support the Government on this, because it is not an issue I would want to die in a ditch over, I think that it is a lost opportunity. We should take all social housing off the public sector debt book so that we can borrow money against it to provide the homes that we badly need. There are 4 million under-sweated assets out there and we should all be able to do the same thing.
My Lords, I can see where the noble Viscount, Lord Younger, is coming from with these amendments and I agree with virtually all the comments that have been made in this short debate. As the noble Lords, Lord True and Lord Shipley, said, it would be helpful if the Minister could confirm that councillors could be appointed to boards if the board thought that appropriate. If you are appointed to a board, no matter what your position is, your duty is to that board and to ensure that the organisation functions properly.
As the noble Lord, Lord Kerslake, said, it is good if local authorities and housing associations have a good working relationship, but if as part of the scrutiny process a council wanted to engage with a local housing association, that would be welcome.
My Lords, I thank all noble Lords who have taken part in this very short debate. I particularly appreciate the support of the noble Lord, Lord Kerslake, and interventions from the noble Lords, Lord Porter and Lord True. To reiterate the background to this measure, some local authorities have rights to nominate housing association board members and act as shareholders. This could allow local authorities in a minority of housing associations to block major constitutional changes. Although local authority control was not one of the reasons why the ONS reclassified the housing associations sector, there is still a risk that this will be identified as a control and delay the reclassification of housing associations.
I reassure the noble Lord, Lord Shipley, that councillors can be appointed to housing associations boards in their own right, provided that they do not speak on behalf of the local authorities. For my noble friend Lord Porter, I say that the clauses refer to nomination rights only. I hope that that reassures him that nothing broader is intended here.
Amendment 78A agreed.
Clause 91: Recovery of social housing assistance: successors in title
78B: Clause 91, page 39, line 36, after “administration” insert “(which, for this purpose, includes housing administration under Chapter 5 of Part 4 of the Housing and Planning Act 2016)”
My Lords, I shall speak to Amendments 78B to 78YW, tabled in the name of my noble friend the Minister. They amend the housing administration regime, which is intended for use in the extremely unlikely event that a large or complex housing association becomes insolvent.
Let me first reassure noble Lords that a robust regulatory framework is already in place for registered housing associations. The regulator will retain its existing powers to help a housing association in financial difficulty. Housing administration is in addition to existing powers, not a replacement. The regulator’s existing powers have meant that there has only ever been one insolvency case in the sector. However, housing associations have become more complex and have significant levels of private debt—about £65 billion in total.
The review of the near insolvency of Cosmopolitan housing association found that the regulator’s powers may not be enough if a large, complex housing association gets into financial difficulty. That is why we have brought forward legislation to introduce an administration regime for housing associations.
I have to beg your Lordships’ patience as I explain the detail of the amendments. Insolvency law is a technical and complex subject but none the less important. I assure the House that officials have been working with lenders, insolvency practitioners, valuers and housing associations on these amendments. The amendments are necessary to address issues raised by them and to clarify how the regime would work.
Amendments 78C to 78N, 78R to 78YF, 78YU and 78YW concern the two objectives of housing administration and necessary consequential amendments. The first objective is the same as a normal administration process that applies to companies. The second objective, which is expressly subordinate to the first, is to retain the social housing within the regulated sector.
We would like to retain social housing stock in the regulated sector but recognise that, if there is an insolvency, this may not always be possible. While the administrator’s primary duty is to the creditors, if this duty can be fulfilled while keeping all or some of the social housing in the regulated sector, that is what the administrator must do.
Amendment 78P introduces a new clause. Sometimes planning obligations under Section 106 of the Town and Country Planning Act 1990 do not apply if a mortgagee enforces security over the land. The proposed new clause puts the housing administrator in the same position as a mortgagee in possession.
Through Amendments 78YG to 78YK, 78YM, 78YN and 78YQ to 78YT—I hope that your Lordships are still following me—the courts cannot allow the winding-up of a housing association without the regulator being notified 28 days in advance. These amendments allow the regulator of social housing to waive this 28-day notice period once they have been notified if they so choose. Waiving the notice period will allow other insolvency procedures to begin more quickly.
Amendment 78YV removes the ability to apply normal administration to a housing association that is a registered society. After consideration with the sector, we decided that this was unnecessary if housing administration was in place. There was also a risk that normal administration could follow housing administration, resulting in lenders not being able to access their security for over two years. Amendments 78YL and 78YP are consequential to Amendment 78YV.
Amendment 78Q sets a time limit of one year on housing administration and sets the parameters for applying for an extension. The appointment period and circumstances for extension are now aligned with normal administration. The Bill did not previously have a time limit. This change provides more certainty for lenders on when they would be able to enforce their security if housing administration fails to resolve the insolvency.
Finally, I am bringing forward Amendment 78B to make it clear that if social housing provided as a result of financial assistance given by the Government is sold by a housing administrator out of the regulated sector, the Homes and Communities Agency cannot recover that assistance from any successor in title. I hope that we never have to use these housing administration provisions and that the housing association sector continues to be financially robust. However, it is prudent that we are prepared for the unlikely event of a large or complex housing association becoming insolvent. I commend these amendments to the House.
My Lords, I do not know whether other noble Lords have been watching it, but there has been a very interesting series on television of a Danish drama called “Follow the Money”, which would be an appropriate title for this group of amendments. That series had the benefit of subtitles and, with all due respect to the Minister, I must say that we could all have done with some subtitles, not necessarily on the day but in the form of a briefing note that could have helped us get our heads around this complicated and arcane topic.
I raise one issue with the noble Viscount. I understand, having been so advised by Shelter, that the Bill originally provided that in the event of insolvency of a housing association the first priority would be to maintain social housing in the sector and secure a transfer to another housing association. The amendments collectively before us make that objective secondary to the interests of the creditors. Therefore, the properties might simply be sold off rather than continue to be held within the social housing sector. Will the noble Viscount indicate whether he or the Government take that as an acceptable position? What would the potential impact be in the event of this crisis emerging with any particular association? Why was it necessary to change the original thrust of the Bill’s proposals and downgrade that priority of maintaining the social housing stock in favour of dealing with the needs of the creditors?
My Lords, I rise with some trepidation to speak against government Amendment 78P. I heard what the Minister said about hoping that there would be no insolvencies, but the Government appear to be expecting a number of registered providers to become insolvent during this Parliament and for the marketplace to have fewer larger housing providers. That will mean that some of the smaller ones will go to the wall.
On Amendment 78P, the land over which there is a current planning permission belonging to a registered provider that has now become insolvent would be sold on. Presumably, that would be to a developer for it to carry out the extant planning permission. However, the Section 106 planning obligations that the local authority in good faith had attached to the granting of the application, in order to serve both the existing communities around the site and the residents who would move into the proposed dwellings once the site been completed, would be waived. I fear that this is gerrymandering on a large scale and does not serve the communities within the local authority concerned at all well.
Of course, removing the planning obligations means that either the developer gets a bargain or that the housing administrator is able to get a higher price for the land. Either way, the local communities will suffer as no leisure or community facilities will be provided which were the subject of the original planning application. I fear that this is penny-pinching and shabby in the extreme.
My Lords, I hope that I can provide some reassurance arising from a couple of questions on this short debate, particularly for the noble Lord, Lord Beecham, and the noble Baroness, Lady Bakewell. I will try to encapsulate both questions in the same way because the best way that we can protect social homes is by making sure that the sector is financially strong. That is the basis of what we are aiming to do. To do that, as I said earlier, we need lenders to have confidence in the sector. We have therefore made it clear that, if absolutely necessary, social housing stock can be sold out of the sector by an administrator. This has only ever happened once and is just a matter of last resort. Therefore, the objective to service creditors takes precedence over the objective to keep social homes in the regulated sector.
The amendment responds to creditors’ concern that the original drafting risks affecting loan security valuations, potentially increasing the cost of debts. This is technical rather than anything more broadly based. The key point is that we need to maintain lender confidence in the sector. I hope that that gives reassurance.
Amendment 78B agreed.
Clause 92: Housing administration order: providers of social housing in England
Amendments 78C to 78E
78C: Clause 92, page 40, line 17, leave out subsection (3)
78D: Clause 92, page 40, line 22, leave out “references in this section” and insert “the reference in subsection (1)(b)”
78E: Clause 92, page 40, line 23, leave out “are references” and insert “is a reference”
Amendments 78C to 78E agreed.
Clause 93: Objective of housing administration
78F: Clause 93, page 40, line 25, leave out subsections (1) to (8) and insert—
“(1) A housing administrator has two objectives—(a) Objective 1: normal administration (see section (Objective 1: normal administration)), and(b) Objective 2: keeping social housing in the regulated sector (see section (Objective 2: keeping social housing in the regulated sector)).(2) Objective 1 takes priority over Objective 2 (but the housing administrator must, so far as possible, work towards both objectives).(3) It follows that, in pursuing Objective 2, the housing administrator must not do anything that would result in a worse distribution to creditors than would be the case if the administrator did not need to pursue Objective 2.(4) A reference in this Chapter to the objectives of a housing administration is to the objectives to be pursued by the housing administrator.”
Amendment 78F agreed.
Amendments 78G and 78H
78G: After Clause 93, insert the following new Clause—
“Objective 1: normal administration
(1) Objective 1 is to— (a) rescue the registered provider as a going concern,(b) achieve a better result for the registered provider’s creditors as a whole than would be likely if the registered provider were wound up (without first being in housing administration), or(c) realise property in order to make a distribution to one or more secured or preferential creditors.(2) The housing administrator must aim to achieve Objective 1(a) unless the housing administrator thinks—(a) that it is not reasonably practicable to achieve it, or(b) that Objective 1(b) would achieve a better result for the registered provider’s creditors as a whole.(3) The housing administrator may aim to achieve Objective 1(c) only if—(a) the housing administrator thinks that it is not reasonably practicable to achieve Objective 1(a) or (b), and(b) the housing administrator does not unnecessarily harm the interests of the registered provider’s creditors as a whole.(4) In pursuing Objective 1(a), (b) or (c) the housing administrator must act in the interests of the registered provider’s creditors as a whole so far as consistent with that Objective.”
78H: After Clause 93, insert the following new Clause—
“Objective 2: keeping social housing in the regulated sector
(1) Objective 2 is to ensure that the registered provider’s social housing remains in the regulated housing sector.(2) For this purpose, social housing remains in the regulated housing sector for so long as it is owned by a private registered provider.”
Amendments 78G and 78H agreed.
Clause 95: Powers of court
Amendments 78J and 78K
78J: Clause 95, page 42, line 21, leave out “objective” and insert “objectives”
78K: Clause 95, page 42, line 26, leave out “objective” and insert “objectives”
Amendments 78J and 78K agreed.
Clause 96: Housing administrators
Amendments 78L to 78N
78L: Clause 96, page 43, line 19, leave out from beginning to “of” in line 21 and insert “The housing administrator of a registered provider must aim to achieve the objectives”
78M: Clause 96, page 43, line 23, leave out subsections (3) and (4)
78N: Clause 96, page 43, line 40, leave out “functions of” and insert “to be carried out by”
Amendments 78L to 78N agreed.
78P: After Clause 97, insert the following new Clause—
“Housing administrator may sell land free from planning obligations
(1) If the housing administrator of a registered provider disposes of land that is the subject of a planning obligation that contains relevant terms, the relevant terms are not binding on the person to whom the land is disposed of or any successor in title.(2) In this section—“disposes of”, in relation to land, means sells a freehold or leasehold interest in the land or grants a lease of the land;“planning obligation” means a planning obligation under section 106 of the Town and Country Planning Act 1990 (whether entered into before or after this section comes into force);“relevant terms” in relation to a planning obligation, means any restrictions or requirements imposed by the planning obligation that are expressed not to apply in the event that the land is disposed of by a mortgagee.”
Amendment 78P agreed.
Schedule 5: Conduct of housing administration: companies
Amendments 78Q to 78YF
78Q: Schedule 5, page 117, line 16, leave out “75,”
78R: Schedule 5, page 117, line 34, leave out “objective” and insert “objectives”
78S: Schedule 5, page 118, line 15, leave out “objective” and insert “objectives”
78T: Schedule 5, page 119, line 15, leave out “objective” and insert “objectives”
78U: Schedule 5, page 119, line 18, leave out “objective” and insert “objectives”
78V: Schedule 5, page 119, line 27, leave out “objective” and insert “objectives”
78W: Schedule 5, page 120, line 7, leave out “objective” and insert “objectives”
78X: Schedule 5, page 120, line 35, leave out “objective” and insert “objectives”
78Y: Schedule 5, page 120, line 42, leave out “objective” and insert “objectives”
78YA: Schedule 5, page 120, line 48, at end insert—
“14A_ Paragraph 78 (consent to extension of administrator’s term of office) is to have effect as if sub-paragraph (2) were omitted.”
78YB: Schedule 5, page 123, line 16, , leave out lines 16 to 18 and insert—
““objectives”, in relation to a housing administration, is to be read in accordance with section 93(4) of the Housing and Planning Act 2016;”
78YC: Schedule 5, page 126, line 31, leave out “objective” and insert “objectives”
78YD: Schedule 5, page 126, line 33, leave out “objective” and insert “objectives”
78YE: Schedule 5, page 127, line 4, leave out “objective” and insert “objectives”
78YF: Schedule 5, page 127, line 10, leave out “objective” and insert “objectives”
Amendments 78Q to 78YF agreed.
Clause 98: Winding-up orders
Amendments 78YG and 78YH
78YG: Clause 98, page 44, line 36, leave out paragraphs (a) and (b) and insert—
“(a) notice of the petition has been given to the Regulator of Social Housing and a period of at least 28 days has elapsed since that notice was given, or(b) the Regulator of Social Housing has waived the notice requirement in paragraph (a).”
78YH: Clause 98, page 44, line 44, at end insert—
“( ) The Regulator of Social Housing may waive the notice requirement under subsection (2)(a) only with the consent of the Secretary of State.”
Amendments 78YG and 78YH agreed.
Clause 99: Voluntary winding up
Amendments 78YJ and 78YK
78YJ: Clause 99, page 45, line 18, leave out paragraphs (a) and (b) and insert—
“(a) notice of the application has been given to the Regulator of Social Housing and a period of at least 28 days has elapsed since that notice was given, or(b) the Regulator of Social Housing has waived the notice requirement in paragraph (a).”
78YK: Clause 99, page 45, line 26, at end insert—
“( ) The Regulator of Social Housing may waive the notice requirement under subsection (4)(a) only with the consent of the Secretary of State.”
Amendments 78YJ and 78YK agreed.
Clause 100: Making of ordinary administration orders
Amendments 78YL to 78YN
78YL: Clause 100, page 45, line 34, leave out paragraph (b)
78YM: Clause 100, page 46, line 4, leave out paragraphs (a) and (b) and insert—
“(a) either—(i) notice of the application has been given to the Regulator of Social Housing and a period of at least 28 days has elapsed since that notice was given, or(ii) the Regulator of Social Housing has waived the notice requirement in sub-paragraph (i), and”
78YN: Clause 100, page 46, line 16, at end insert—
“( ) The Regulator of Social Housing may waive the notice requirement under subsection (3)(a)(i) only with the consent of the Secretary of State.”
Amendments 78YL to 78YN agreed.
Clause 101: Administrator appointments by creditors
Amendments 78YP to 78YR
78YP: Clause 101, page 46, line 24, leave out paragraph (b)
78YQ: Clause 101, page 46, line 39, leave out paragraphs (a) and (b) and insert—
“(a) either—(i) that notice of the appointment has been given to the Regulator of Social Housing, accompanied by a copy of every document in relation to the appointment that is filed or lodged with the court in accordance with paragraph 18 or 29 of Schedule B1 to the Insolvency Act 1986 and that a period of 28 days has elapsed since that notice was given, or(ii) that the Regulator of Social Housing has waived the notice requirement in sub-paragraph (i),”
78YR: Clause 101, page 47, line 7, at end insert—
“( ) The Regulator of Social Housing may waive the notice requirement under subsection (4)(a)(i) only with the consent of the Secretary of State.”
Amendments 78YP to 78YR agreed.
Clause 102: Enforcement of security
Amendments 78YS and 78YT
78YS: Clause 102, page 47, line 21, leave out paragraphs (a) and (b) and insert—
“(a) notice of the intention to do so has been given to the Regulator of Social Housing and a period of at least 28 days has elapsed since the notice was given, or(b) the Regulator of Social Housing has waived the notice requirement in paragraph (a).”
78YT: Clause 102, page 47, line 27, at end insert—
“( ) The Regulator of Social Housing may waive the notice requirement under subsection (2)(a) only with the consent of the Secretary of State.”
Amendments 78YS and 78YT agreed.
Clause 103: Grants and loans where housing administration order is made
78YU: Clause 103, page 47, line 33, leave out “objective” and insert “objectives”
Amendment 78YU agreed.
Clause 109: Registered societies: ordinary administration procedure etc
78YV: Clause 109, leave out Clause 109
Amendment 78YV agreed.
Clause 111: Interpretation of Chapter
78YW: Clause 111, page 51, leave out lines 12 and 13 and insert—
““objectives of the housing administration” means the objectives in section 93(4);”
Amendment 78YW agreed.
Clause 113: Secure tenancies etc: phasing out of tenancies for life
79: Clause 113, leave out Clause 113
My Lords, the purpose of this amendment is to remove from the Bill the provision for mandatory fixed-term tenancies. I understand that later on in this debate we will get a constructive and helpful response from Ministers that I hope will go some considerable way to addressing the concerns I have about this issue. I am extremely grateful for that: it is another example of a Minister listening and responding to the issues we have raised.
Nevertheless, it is worth explaining why the amendment is so important and what it goes to the heart of. It effectively addresses the issue of whether we see council properties as genuine homes or as houses or even a temporary welfare provision, because that is the direction of travel that this policy takes us in. In the previous debate about the so-called pay-to-stay provisions, I used an example and I will use another to illustrate my point. This one is a little closer to home and involves my wife.
My wife lived until the age of five in rented rooms. It is important to say “rented rooms” because they were not a house or a flat. They were rooms in a house. There were two rooms to be precise. One was the living room and the other was the bedroom, which she shared with her parents. The other facilities—the bathroom, kitchen and so forth—were all shared. At the age of five, she moved into a three-bedroom council property. She still remembers that move, less because of the personal impact on her—she was too young to know—and more because of the incredible excitement of her parents. For the first time they had a permanent dwelling that met their needs. She lived in Nottingham. Why was it possible for her to move into that home? The answer is that this was 1962 and Nottingham had embarked on a massive council property construction programme. Her family was one of the lucky ones who moved into that property.
Would they have felt the same way about that move if what they had been offered instead was a five-year fixed-term tenancy? They might of course have heard reassuring noises, as the Minister mentioned in Committee, that perhaps it would be okay and it would almost certainly be possible to roll over the tenancy; but would they have felt as if it was their home? The answer is pretty clear. They would not. Their response and reaction to that move would have been entirely different.
That is essentially what we are doing through the provisions in the Bill, unless they are changed. We know now that the problems are if anything more acute than when my wife was moving, rather than less, but we are saying to people who have typically been in a temporary and inadequate property for the best part of their lives that we are now moving them into another temporary or insecure property. We are moving into a world in which people’s ability to stay in their property is driven by whether the state, in this case the Government, deems them to be deserving of continuing with that property. That is not a home.
That is one personal example. What does the evidence tell us so far about the impact of secure tenancy? Of course, in a sense, we do not need to guess what the impact is—we already have voluntary arrangements in place. Some 13% of new lets are on fixed-term tenancies. I am indebted to Shelter for drawing to my attention a piece of academic research on this issue, undertaken by Professor Suzanne Fitzpatrick and Dr Beth Watts of Heriot-Watt University. This work has been done as part of a consortium involving local authorities and universities across the country under the heading “Welfare Conditionality”. The research finds that those early adopters are becoming increasingly disillusioned with the effect of this policy. They are finding, certainly, that some tenants are unaware that they are on a fixed-term tenancy, but far more are deeply anxious about the uncertainty that comes with that, and that the more dependent they are, the more anxious they are.
Can we conceive of a situation in which families with school-age children might be forced to move out of their property when the children are at school? The noble Lord, Lord Bassam, spoke very eloquently about this issue, which goes to the heart of the ambition we all have to create stable, successful communities. Such communities need stable tenants; without them, investment in the community is unlikely, because of uncertainty about the future.
This provision is neither necessary nor appropriate. The early evidence from local authorities that have tried it is that it simply does not work, and they are moving back from it. I recognise that there is a government ambition to make changes here, and I look forward to hearing what the Minister has to say.
My Lords, I rise to speak to Amendment 80ZB in my name and that of the right reverend Prelate the Bishop of St Albans, for whose support I am grateful, although I know he is unable to be in his place today. I do so in the context of my opposition to Clause 113 and Schedule 7, which is partly for the reasons so eloquently stated by the noble Lord, Lord Kerslake. I have argued before that this measure will destroy the security that is so important to families with children, disabled people and carers, people with mental health problems and those who have experienced homelessness. Ministers constantly tell us that this is what this Government are all about.
The amendment would exempt those who give up an old-style secure tenancy because of domestic violence. The great majority of these will be women. Incidentally, I still have not received an equality impact assessment for this clause, despite a further request. I will not repeat the full case. In Committee, the Minister said that she fully appreciated the intention behind this amendment. She promised that:
“In developing the regulations that determine when a local authority may grant existing lifetime tenants a further lifetime tenancy when they move home, we will give very careful consideration to whether this should include those who are moving home to escape violence or intimidation of any kind”.—[Official Report, 14/3/16; col.1715.]
Welcome as that was, I want to press the Minister on two points. I am grateful to the noble Baroness, Lady Williams of Trafford, for the constructive meeting we had on this issue.
First, I hope that the Minister is now in a position to tell us whether the Government will include this group in the regulations. What possible argument could there be against excluding women who might otherwise be trapped in domestic violence and abuse, thereby undermining the Government’s welcome strategy to tackle violence against women and girls, when research already shows that insecure housing can have a devastating impact on women and children in this situation? I emphasise that such regulation should not cover just victims of domestic violence who move home but also situations where a joint tenancy is ended and a new sole tenancy granted in the name of the victim.
Secondly, as I argued in Committee, it is not sufficient to give local authorities a permissive power, because the experience of their treatment of women who flee domestic violence suggests that they cannot always be trusted to use it when they should do so. Since Committee, a further study by Solace Women’s Aid found that over two-fifths of those presenting to local authority housing services reported that they found them unhelpful. Many described housing officers as unsympathetic, uninterested and disbelieving. There was considerable inconsistency in how they were rehoused. It is not good enough to put a discretionary power in the hands of officials who too often do not appear to understand domestic violence. If a domestic violence victim contemplating giving up a secure tenancy does not know whether a local authority will grant her a new secure tenancy, she could decide that the uncertainty and risk associated with doing so is just too great. If it is not possible to leave out the offending clauses entirely, at the very least women in this situation should be given the certainty that a clear right to a further lifetime tenancy would provide. Anything less risks undermining the Government’s commitment to tackling violence against women and girls.
My Lords, my brother bishop, the right reverend Prelate the Bishop of St Albans, as we have heard, is unable to be here. He has asked me to speak to Amendment 80ZB and I very gladly do so.
It is so important not only for women who may have been abused but for their children, who may have often witnessed abuse or been similarly abused, that they should have security. This is about children’s well-being and their development into stable and secure adults. Under the current proposal, if a woman who is being abused leaves the home, she will lose the secure tenancy. Unless discretion is brought in under regulations, the only option will be an unsecured tenancy, which is the worst thing possible for the children as well as the mother.
It seems completely self-evident that it should be written in that there should be no discretion, and that women who have to leave their home for reasons of violence against them or their children should be allowed to move to another secure tenancy.
My Lords, I shall first speak to Amendment 80ZB, although my name is not attached to it, in the names of the noble Baroness, Lady Lister of Burtersett, and the right reverend Prelate the Bishop of St Albans, as I think this is an extremely important issue. I cannot believe the Government intend that a woman who lost a tenancy as a consequence of domestic violence should not be able to have that renewed as a secure tenancy, and I hope very much that the Minister will be able to put our minds at rest on the matter.
On Amendment 79, to which my name is attached, when the Minister responds to the debate, I hope she will define for us again what the problem is that the Government are trying to solve because, for the life of me, I find it very difficult to understand. For one thing, there is existing legislation in the Localism Act, which we debated in your Lordships’ House only a few years ago, and I am not clear why the provisions in that Act are not sufficient in this case.
For me, this is about community cohesion. It is about enabling those who are in social rented accommodation to stay in their homes and build a sense of community in their area. I worry that, if the Government got their way with the Bill as it is currently worded, we would simply end up with a large number of short-term tenancies. I do not believe that five years is enough. I can understand that a local authority might want the flexibility to have a minimum of two years, but it seems to me that the amendments that we considered in Committee, and that we are now considering on Report, would help us to improve the Government’s recommendations in the Bill. I, for one, would prefer 10 years, with the right of the local authority, which exists anyway in the Bill, to renew a tenancy as a secure tenancy.
This whole proposal shows signs of being rushed. The problem that the Government are seeking to solve is ill-defined, if defined at all; it is all about encouraging more tenants to buy their own homes. That takes us right back to the purpose of the Bill and the 200,000 starter homes. The problem, as we have identified repeatedly in our consideration of the Bill, is that many tenants are not in a position to buy their own home, even with a 20% discount on the cost of a starter home. They will therefore need to rent.
There is nothing worse, surely, for neighbourhoods and communities than to end up with people in uncertainty, worry and stress, and with children in school not quite knowing whether they will have to move a long way away, where they may be unable to continue in the local school that they have come to know. In terms of people living near where they work, travel patterns are established when people have longer-term tenancies.
Longer-term tenancies enable people to have confidence about the area that they live in, and to feel that the house or flat that they live in is actually a home. We should use that word “home” much more than we do. We talk about tenancies, houses and flats and so on, when this is about people’s homes. It is about places where families live, where children are brought up and where people are based who can then secure employment.
This Bill should be an improvement on the Localism Act and the legislation that is already in place. As I understand it, the Government have indicated that they want this amendment on secure tenancies, because not enough tenants have moved into owner-occupation and not enough local authorities have been giving fixed-term tenancies to their tenants. In the end, this should be a matter for local authorities to address. I am very much looking forward to hearing what the noble Lord, Lord Kerslake, referred to—we are going to hear some good news, apparently, about secure tenancies. I very much hope that we do and that it will be satisfactory because, as things stand, this is a very bad proposal.
My Lords, may I ask the Minister a question, if she will listen to what I am saying? Perhaps those with the Minister could indicate to her that I am asking a question. Can we be told why this proposal was brought before Parliament only on the last day in Committee? That is what happened, as I understand it. Members in the House of Commons were not given any notice of this. Why was it introduced on the last day in Committee? Was some pressure being exerted by some group? Was it always in the Government’s mind to introduce such a measure? Was it pressure from local authorities? Where did the pressure come from?
My Lords, I shall make a brief intervention in support of the policy of bringing to an end lifetime tenancies. I recognise the powerful points that have been made on behalf of those who suffer from domestic violence, and I hope the Minister will listen carefully to those representations.
It is just worth making the point that this is a prospective policy; it would not apply to existing tenants. I say that because one of the letters I got from a residents’ association in London implied that this was in some way retrospective, taking away security that people have.
The point is that one needs a balance between, on the one hand, those who currently enjoy lifetime tenancies and, on the other, those who are on the waiting list. Throughout this debate, one criticism that has been made of the Government is that we are not building enough secure accommodation for rent for those in housing need, for whom social housing for rent is the only answer. For someone on the waiting list, there are two factors that are of relevance: one is the rate of new build of social housing, and the other is the rate of re-letting. When I last looked at the figures, the number of re-lets each year was 400,000—roughly two-thirds from housing associations, and roughly one-third local authority—whereas the number of new homes built for rent was 50,000. In other words, the re-let market is eight times more important for those on the waiting list—those in housing need—than new build.
The reason why I support ending lifetime tenancies and bringing in fixed-term tenancies is that it promotes a conversation between the local authority and the tenant that may be of interest not only to those on the waiting list but to the current local authority tenant. That conversation will bring to the tenant’s attention a range of options that he or she might not previously have considered. One reason why I have consistently supported the transfer of the discount scheme is to enable those currently in social housing to move out and free up such homes. A re-let secures an immediate solution for someone on the waiting list at a fraction of the cost of new build and within a fraction of the time.
That is why I think that one must look at both sides of the coin: the expectations of those who currently enjoy good social housing and those on the waiting list, who are looking for some movement in social housing to solve their problems. If, at the end of the conversation, there is clearly no other option that is acceptable to the tenant, then of course the tenancy should be renewed—I do not think any local authority will abuse the powers given to it—but it will have promoted a conversation and enabled a range of options to be presented to the tenants, which may increase the number of re-lets, which may in turn help those on the waiting list. That is why I think the time is due for the introduction of such a policy.
My Lords, I associate myself with the comments made by my noble friend Lord Young in support of the Government’s policy. We have heard many powerful personal stories, including from the noble Lord, Lord Kerslake, about people who currently benefit from lifetime tenancies. As my noble friend has explained, in a way that exemplifies an issue that we need to keep front of mind here, which is what economists would call an insider-outsider problem. In practical terms, that means that we have a tendency to undervalue the benefits of a policy to those who are not yet benefiting from it, compared with those who already have a benefit. Quite simply, those who already have a benefit are identifiable—they can write letters. Those who may yet benefit are not in that position. We tend to hear from them less and, as a consequence, we have an unbalanced view of the benefit of a given policy.
This is incredibly important when we think about how it impacts on the welfare state and our ability to support the neediest. I have a personal story—or at least a neighbourhood story—to share about a local housing association tenant, an elderly lady, who lived next door to us and who died. Her flat was inherited by a single working son. Five doors down in temporary accommodation, families crammed into tiny flats did not have a chance to move into that vacated flat because it was passed on to a relative. No one wants to reduce the housing support that anyone benefits from, but is that really a fair distribution of the limited resources that we have at our disposal?
The principle we need to consider is how best to use the funds and assets of the state when we still have a large deficit. We are not in a position not to consider these things. We need to bear in mind that whenever we water down provisions in the Bill, whether through taper thresholds or time limits, the effect is to ask less well-off taxpayers to subsidise those who, in this case, are not in as much need of public financial support. That, in my view, is not progressive. Indeed, it is the opposite. When considering how to vote, I urge your Lordships to consider those who are unable to access a social home, who are subsidising social housing through their taxes but are not benefiting from it. These people—the neediest—must surely be given a better chance of accessing a social home. That is what these amendments would prevent.
My Lords, I had no intention of speaking at this point because I have an amendment in the next group, but we need to stop perpetuating this myth that social housing is subsidised by the taxpayer. Well-prepared, well-delivered social housing is a financial benefit for this country. All the money we have mortgaged in those properties is about a third of its total value. If we are truly progressive we should be looking at how we sweat the asset that we already have tied up in there. There is no need for the Treasury to put fresh money into it. We just need to utilise the existing stock in a way that maximises its benefit for the whole country. That said, I will sit down now, as I am waiting to speak later.
I congratulate my worthy successor as chairman of the Local Government Association on disabusing his colleague of the notion I referred to—that the taxpayer is funding council housing and subsidising people who should not be subsidised. It is simply not true, and I am very glad that the noble Lord, Lord Porter, made that point.
I and all on our Benches support the amendments in the names of the noble Lord, Lord Kerslake, and of my noble friend Lady Lister. I also endorse the comments of the noble Lord, Lord Shipley. He made the valuable point that we talk too much of “houses”, or, as I think Churchill once described them, “units of accommodation”—not, he thought, an appropriate phrase—but we ought to regard them as homes. In that context I remind the noble Lord, and other noble Lords, that homes with a spare room are also homes. They, of course, are subject to the bedroom tax. We do not want to reopen that debate, but it is analogous, really, to the way in which the Government look at social housing.
The Bill’s provisions about secure tenancies—in effect turning them into insecure tenancies—say a great deal about the Government’s professions of localism and their attitude to council housing. As other noble Lords said, councils were given the power by the previous Government to allocate properties on the basis of a two-year to five-year tenancy. I shall come back to some findings on that in due course, but they currently have that choice.
We take a diametrically opposite view from the Government, who simply replace the decision-making of local authorities by imposing their own solution. Local authorities should be free to determine their policies in this and other areas, subject to a requirement to provide, where relevant, at the least a basic level of service and entitlement, whatever the service may be. The Government approach the issue from the other end: councils should do only what the Government condescend to allow them to do. When it is convenient for the Government to pass the buck—as, for example, in the case of abolishing the council tax support scheme—they will do so, but when councils do not wish to subscribe to the Government’s distaste for the provision of council housing they have to conform.
Heriot-Watt University recently published an interesting study under the somewhat daunting title Welfare Conditionality—Sanctions, Support and Behaviour Change, dealing with the issue of fixed-term tenancies as provided by Clause 113 of the Bill. These have, as we have heard, been an option for local councils since the Localism Act 2011—a misleading title if ever there was one. Now they are to be compulsory, subject to the possibility of extension, on any future tenancy. The report avers that, taken together with pay to stay, the Government’s vision is one of,
“catering … for the very poorest on a temporary basis”.
Many councils that adopted the concept of two-year to five-year lets are regarded as being “disillusioned about their merits”, not least with regard to,
“the scope for using them to generate additional social lettings in high demand areas”,
and there is scepticism about the use of the mechanism to promote social mobility or positive tenant conduct. There is a suggestion that behaviour policy lay partly behind the scheme, so you would reward people by allowing them to stay in the property beyond two to five years if their behaviour was appropriate.
The latter point has been a factor in the promotion of the concept, but one for which there is little evidential support, the Heriot-Watt report says. Several academic authorities are quoted, on the other hand, as supporting the view that security of tenure has been an essential element of social housing. Yet this is already threatened by the total benefit cap for families with more than two children, who could find even social housing rents unaffordable. In any case, some two-thirds of all social housing, council and housing association properties are offered with a probationary period, but only 13% of new general-needs lettings were made on a fixed term basis in 2014-15. Interestingly, the advice from the Department for Communities and Local Government was originally to let for five years, with a two-year term as an exceptional alternative. Indeed, most local authorities that have taken advantage of that option have let for three to five years—the latter in effect now becoming the maximum, rather than the minimum, term under the Bill’s provisions.
Even where housing associations adopted the option, the report discovers growing disillusionment—especially where, as in high-demand areas like London, shortage of housing makes finding alternative accommodation exceedingly difficult—while the costs of managing the process were becoming disproportionately high. Those costs, of course, have to be met from within the housing revenue account and therefore by tenants in general. Conversely, there are areas of lower demand where it simply makes no sense to make people move on. Of course, the impact on householders and on communities can be considerable. Why should tenants invest in their homes if they have only limited tenure? Where, given the shrinking availability of affordable social housing to rent, are they supposed to go? If to the private rented sector, at what cost to them or the taxpayer if housing benefit has to be paid to cover the higher rents? Does not such pressure also feed through to ever-rising house prices?
The amendments in this group seek to minimise the damage to what has been a key contributor to the well-being of individuals, families and communities, namely the provision of decent, affordable, secure homes—as legitimate a part of overall housing provision as owner-occupation. Of course, as many other countries, not least in Europe, demonstrate, we have among the highest rates of home ownership of any country in Europe. Choice should not be confined to those who can afford—with or without generous subsidies, in the case of starter homes—to buy, but should be available to those who cannot afford it or who do not wish to buy. They are not second-class citizens. The Government should recognise that in the provisions they make in the context of tenancies in the social housing sector.
My Lords, before I turn to the amendments in the name of my noble friend Lady Williams it may be helpful if I say a few words about why we are making the changes to secure tenancies. I apologise at the outset if that means my remarks may be slightly on the long side.
The provisions in the Bill will ensure that social housing is focused on those who really need it, for as long as they need it, and that tenants are provided with more appropriate tenancies as their needs change over time. Local authorities will be able to get the best use out of their homes, so that more households are able to access social housing and so that social tenants who aspire to own their own home are supported into home ownership where they can be. We listened carefully to the debate in Committee and, indeed, now on Report, and recognise the strength of feeling on this issue, so I am happy to be able to say that as a result we are prepared to give an undertaking that we will bring forward amendments at Third Reading to extend the maximum tenancy period to 10 years in certain circumstances and to enable local authorities to give longer tenancies to cover the time that children are at school. I am also able to give a commitment that we will meet the concerns raised by the noble Baroness, Lady Lister, about domestic violence, through regulations. I will return to these later in these remarks, as well as in remarks on the next group.
Amendments 79A, 80AA, 81ZB, 81ZC, 81ZD and 81ZE are technical amendments which are intended to help local authorities implement the provisions in Schedules 7 and 8. Amendment 79A ensures that local authority landlords will be able to terminate a new fixed-term tenancy on the statutory fault grounds during the fixed term without the need to take additional action to forfeit the tenancy. Very briefly, forfeiture is the method by which tenancies may be brought to an end by a landlord following the tenant’s breach of a tenancy condition. The Housing Act 1985 provides routes for local authorities to recover possession from tenants with fixed-term and lifetime tenancies.
Lifetime tenancies can be brought to an end on grounds specified in the legislation; however, there has been some debate about the effect of the legislation in relation to ending a fixed-term tenancy during the term. In particular, commentators differ in their views about whether landlords have to use both the forfeiture process and the statutory method of bringing the tenancy to an end. This issue was highlighted by the Opposition in the other place during debate on the provisions in the Bill. Until now the issue has been mainly academic, as most local authority tenancies are granted on a lifetime basis. However, as we move to fixed-term tenancies in future the issue is likely to gain in significance and we therefore want to put the matter beyond doubt. We do not think that there is any justification for landlords to have to go through a two-stage process to bring a fixed-term tenancy to an end during the fixed term. It would be unduly complicated and onerous.
The amendment will therefore ensure that landlords can terminate the tenancy during the fixed term by obtaining an order of the court for possession of the dwelling house on one of the grounds set out in the legislation and executing that order. We expect that local authorities will usually set out the statutory grounds on which they can seek possession in their tenancy agreements. However, this provision makes it clear that it is not essential for a landlord to rely on the statutory grounds when seeking possession. These changes apply only to new fixed-term tenancies granted once the Bill comes into force.
Amendments 80AA, 81ZB, 81ZC and 81ZE enable local authorities to continue to include provision for forfeiture to cover the situation where a tenancy is no longer secure—for example, where the tenant is no longer using it as their main home—and the statutory possession grounds would not be available. Under the normal rules of succession, the successor takes on the tenancy of the deceased, including any outstanding possession order attached to that tenancy. Amendment 81ZD ensures that this will continue to be the case where someone other than a spouse or partner qualifies to succeed and is granted a five-year fixed-term tenancy under the provisions in the Bill. These are technical amendments which are intended to clarify and simplify the existing legislation and make fixed-term tenancies work more effectively for local authorities. I therefore hope that noble Lords will accept them.
Amendment 81ZA introduces a new clause to deal with mutual exchange, whereby one social tenant swaps with another. It responds to a point raised by the noble Lord, Lord Best, in Committee about the position of social tenants who exchange. We want to ensure that social tenants continue to be able to move within the social rented sector, including when they move through mutual exchange. To ensure that the introduction of flexible tenancies did not act as a barrier to mobility, the Localism Act introduced a provision which enabled lifetime tenants of local authorities and private registered providers to maintain their security of tenure when swapping homes with tenants with fixed-term tenancies. It did this by giving tenants a power to insist that the prospective landlord must grant them a further lifetime tenancy where they consent to the swap.
Amendment 81ZA amends the provision in the Localism Act so that it applies to new local authority fixed-term tenants as well. However, with 1.2 million households on the waiting list, we do not think that it is sensible to guarantee that lifetime tenants should always be given another lifetime tenancy when they swap. Accordingly, the new clause provides that in future local authority and private registered provider landlords will have discretion to grant lifetime tenants a further lifetime tenancy where they swap. We will specify the circumstances in which local authorities may exercise this discretion. This will be similar to the position for lifetime local authority tenants who seek to transfer to another local authority home in future, where local authorities will have a limited discretion to offer another lifetime tenancy. We have already taken a power to regulate to specify the circumstances in which local authorities may continue to offer lifetime tenancies. We will ensure that these regulations cover the situation in which tenants swap as well as where they transfer.
The Localism Act gave protection only to tenants who had a lifetime tenancy before the Act came into force; that is, before 1 April 2012. We do not think there is any justification for retaining the inconsistency of approaches and are therefore proposing that the new provisions will apply to all lifetime tenancies whenever they were granted. The existing law will continue to apply where an application to swap has been made at the time the Bill comes into force. Amendment 80ZA makes a minor consequential amendment to Schedule 7 to allow local authorities to continue to grant lifetime tenancies where lifetime tenants mutually exchange.
Amendments 79 and 80B would remove altogether the provisions in the Bill that restrict the use of lifetime tenancies. While I appreciate the strength of feeling on this issue and I have spoken about some amendments the Government are willing to bring forward, I cannot accept these amendments. The provisions in the Bill deliver on a commitment in last year’s summer Budget to limit the use of lifetime tenancies in social housing. The noble Lord, Lord Campbell-Savours, asked why these were not included from the outset. As I have just said, we made clear in the July Budget our intention to review the tenancies and since it is a complex area we needed to make sure that we got it absolutely right before introducing the amendments. We are clear that continuing to grant tenancies with lifetime security to households which may have only a short-term need is not a good use of scarce social housing; it is not fair to tenants who are forced to remain in unsuitable or overcrowded housing and not fair to the hundreds of thousands of households on waiting lists and in housing need.
We know that there is a need for more housing across the country and are already taking steps to provide it, but it is imperative that we also make efficient use of the existing stock. By requiring councils to grant fixed-term tenancies with regular review points, we will ensure that more households are able to access social housing, that those who continue to need social housing are provided with appropriate housing as their needs change over time and that social tenants who aspire to own their own home are supported into home ownership where this is viable for them. In Committee we gave a commitment to provide guidance to councils to assist them in implementing these changes. This will make it clear that where a tenant’s circumstances are broadly unchanged we expect that landlords will normally grant a further tenancy in the same home.
Amendment 80ZB would ensure that where a tenant had to give up their lifetime tenancy as a result of domestic violence they would be granted a further lifetime tenancy in their new home. I thank the noble Baroness, Lady Lister, for raising this important point again and, of course, for her commitment to protecting victims of domestic abuse. The Bill already includes provisions to ensure that lifetime tenants can be granted a further lifetime tenancy in certain circumstances and we will specify that in regulations. I am happy to give a commitment now that we will ensure that the regulations include those who need to move or have fled their homes to escape domestic violence. We look forward to working with the noble Baroness on how we can do this most effectively.
May I seek clarification? I made an important distinction between having a permissive power and making it clear in the regulations that those affected by domestic violence will be exempted. Will the Minister clarify that this will be the latter and not simply a permissive power, because that is not going to be enough?
Yes, I can clarify that. I fear that I will have to find out what has happened on the equality statement and come back to the noble Baroness as soon as possible. I apologise—I know that she has raised it constantly. I fear I do not have any further news for her but I hope that what I have said previously makes up a bit for that.
Amendments 81 and 81A would undo the changes we are making to succession. It would mean that there would continue to be a distinction between the succession rights of tenancies granted before and after 1 April 2012. Family members of tenants granted their tenancy before that date would continue to have an automatic right to succeed to a social home, while family members of tenants granted their tenancy after that date would be entitled to succeed only at the landlord’s discretion. We believe that it does not make sense to retain this distinction simply on the basis of the date the tenancy was granted. That is why we are bringing the succession rights of secure tenancies granted before April 2012 in line with those granted after that date. These amendments would also mean that family members who might have no need for social housing were able to succeed to a lifetime tenancy. Again, we do not believe that this can be right when there are so many in need on council waiting lists, and when all new tenants in future will receive only a fixed-term tenancy.
The provisions will deliver a consistent approach across all council tenancies. They will put common-law partners on an equal footing with married couples and civil partners who will retain their entitlement to succeed to a lifetime tenancy, and will ensure that councils have the flexibility to provide additional succession rights not just to family members but to people such as those who have given up their own home to care for the tenant over a number of years. Where councils decide to grant additional succession rights, if the deceased had a lifetime tenancy, the successor will be given a five-year tenancy. In line with other tenants, there will then be a review at the end of the five years. However, as I also said, if circumstances have not changed, we anticipate the local authority extending the tenancy further.
The changes we are making to the succession rules strike the best balance between protection for tenants and their families, and flexibility for landlords to make the most efficient use of their stock for the whole community. Taken together, these amendments would seriously weaken the ability of local authorities effectively to manage their housing stock. I need to be clear that, should Clauses 113 and 114 and Schedules 7 and 8 not stand part, the other place will be certain to overturn this decision. With this in mind—and, I hope, with the commitment I have given in relation to Amendment 80ZB and the further discussion we will have on the next group of amendments—I ask that the amendment be withdrawn.
Will the Minister clarify what she said at the beginning of her reply—that local authorities would be enabled to issue 10-year tenancies in certain circumstances? Can she tell the House more about what circumstances will be explained at Third Reading—because the Government’s intention is to come back to this at Third Reading—in relation to adding 10-year tenancies to the Bill? Will the “certain circumstances” also be included in the Bill? In other words, will they be explained in detail at Third Reading, or is it the Government’s intention simply to add them to regulations? Will the affirmative or the negative procedure be used in relation to those regulations? This is an extremely important issue for many of us. The affirmative procedure should be used in respect of regulations. It would also help us to be told what the Government mean by “in certain circumstances”.
My Lords, like the noble Lord, Lord Shipley, I would like to understand what “in certain circumstances” might mean. I look forward to that conversation between now and Third Reading. That said, I am grateful for the movement that has been made.
I am also grateful for noble Lords’ contributions to this debate. The noble Baroness, Lady Lister, spoke powerfully about domestic violence issues, which must be at the front of our minds. The noble Lord, Lord Shipley, spoke—as I did—about the importance of seeing this as an issue about people’s homes, not simply housing units. That is at the core of this debate. The noble Lord, Lord Young, spoke about re-lets. I entirely agree about the importance of increasing re-lets but disagree about the method. My personal view is that the way to increase re-lets is to increase the supply of new social rented properties and ensure that we have a positive offer to make to those who might want to downsize their property, not by coercing them and creating greater uncertainty. The noble Lord, Lord O’Shaughnessy, spoke about the so-called insider/outsider problem and the voice of those inside in a social rented property being less than those outside aspiring to get a social rented property. Anybody who has worked in a local authority or been a councillor has no doubt about the voice of the outsiders—those who are homeless—as it is with them every single day of the week. Finally, the noble Lord, Lord Beecham, spoke about the research. I commend this research to every Member of this House because it gives a very clear understanding of the practical impact of this policy, which creates uncertainty and not value in the way that was originally envisaged.
I am grateful that we have seen movement on this issue and look forward to the conversations between now and Third Reading. I beg leave to withdraw the amendment.
Amendment 79 withdrawn.
79A: After Clause 113, insert the following new Clause—
“Termination of fixed-term secure tenancies without need to forfeit
(1) The Housing Act 1985 is amended as follows.(2) In section 82 (security of tenure)—(a) before subsection (1) insert—“(A1) A fixed-term secure tenancy of a dwelling-house in England that is granted on or after the day on which paragraph 4 of Schedule 7 to the Housing and Planning Act 2016 comes fully into force cannot be brought to an end by the landlord except by—(a) obtaining—(i) an order of the court for the possession of the dwelling-house, and(ii) the execution of the order, or(b) obtaining a demotion order under section 82A.(A2) A secure tenancy can be brought to an end by the landlord as mentioned in subsection (A1)(a) whether or not the tenancy contains terms for it to be brought to an end.”(b) in subsection (1)(b), for “but” substitute “, other than one to which subsection (A1) applies, that is”;(c) in subsection (2), after “subsection” insert “(A1)(a) or”.(3) In section 83 (proceedings for possession), in subsection (A1), for “82(1A)” substitute “82(A1) or (1A)”.”
Amendment 79A agreed.
Schedule 7: Secure tenancies etc: phasing out of tenancies for life
80: Schedule 7, page 129, line 29, leave out from beginning to end of line 35 and insert—
“81A Granting of secure tenancies A local housing authority may grant a secure tenancy of a dwelling-house in England for a fixed term that is—(a) at least 2 years, and(b) up to and including 10 years.”
My Lords, I intend to speak fairly briefly to this amendment. I heard what the noble Baroness, Lady Evans of Bowes Park, said in respect of the previous group of amendments. Therefore, I will not press this amendment to a vote at this stage and will wait to see what amendment is brought forward before I decide whether I need to bring anything back at Third Reading.
The noble Lord, Lord O’Shaughnessy, who is about to leave the Chamber, referred to taxpayer subsidies. He is completely wrong about that. This issue was raised in a previous debate in your Lordships’ House on 14 March, following which I tabled a Question to the noble Baroness, Lady Williams of Trafford. I received a response on 24 March, which confirmed that the assertion was not correct. I will happily send the noble Lord a copy of the response from the noble Baroness. I will now proceed to move my amendment as I know that other noble Lords want to speak to their amendments and hear the Minister’s response. I beg to move.
My Lords, if I appear to be somewhat of an interloper in these considerations, having not spoken on this Bill previously, it is probably because that is precisely what I am— but I do want to say a few words in relation to Amendment 80A, to which my name is attached.
I listened carefully to what the noble Baroness, Lady Evans, said in the last few minutes, and even took some notes. I think that she said—I hope that I am not quoting her inaccurately—that longer tenancies to cover the time that children are at school will form part of the amendments to emerge from the Government at Third Reading. That is very welcome. But I would like to reinforce some of the points that I hope the noble Baroness, Lady Evans, who also has responsibility for education, might want to bear in mind as the amendment is being framed.
On 24 March the Department for Education issued a press release relating to research into absences from school at key stage 2, which is seven to 11, and key stage 4, which is 14 to 16. The press release was in the name of the Schools Minister, Mr Gibb. He said that,
“missing school for even a day can mean a child is less likely to achieve good grades, which can have a damaging effect on their life chances”.
I think that that is widely accepted—but how much more disruptive must it then be to have to change school entirely, probably to leave the area in which the family has made its home and re-establish life, friendships and study in a new school in an unfamiliar area?
That means building new friendships and relationships. For children growing up, having friends is so important for sharing ideas and experiences. This is particularly true for those at key stage 4—a time when discussions take place on aspects of exams which could be crucial for their life chances. Lacking those support mechanisms would represent a disruption to school life which would be unnecessary but for the current provisions of the Bill.
The noble Baroness, Lady Evans, will also be aware that the Department for Education is currently undertaking a somewhat controversial consultation on schools funding. One of the questions in the consultation document is:
“Do you agree that we should not include a factor for mobility?”
It might seem strange to some noble Lords that it should even be suggested that mobility is not an issue in terms of funding. However, the National Association of Head Teachers, which is effectively the union for school leaders, is unequivocal in its answer to that question and states:
“No. Pupil mobility is an enormous challenge for some schools, with some of our members reporting in-year mobility of over 50% due to general mobility in an area with high levels of migration or a seasonal workforce. Coping with this and ensuring that those children benefit from their education for the time they are in school and that other children’s education is not disrupted requires enormous effort and investment from schools and this has to be supported by additional funding”.
That view reinforces the results of research carried out by the Royal Society of Arts in 2013, published in a report entitled Between the Cracks. That publication, too, was clear about the disruptive nature for children of having to leave a school, particularly where it happens in-year and they cannot access high-performing schools which are, almost inevitably, full to capacity. So I would like the Government to bear in mind those issues when they are framing their amendment.
Finally, on the day when parents have been finding out if they have got the primary school of their choice for their children, it is surely incumbent on Ministers to ensure that children are given every chance to succeed at school, and not to insert obstacles to learning. I await with interest—and indeed with optimism—the government amendment on this issue and look forward to returning to it at Third Reading.
My Lords, I will speak in favour of Amendment 80AZB in my name and against the amendment in the name of the noble Lord, Lord Watson. Under his amendment, councils “must” do something. From an LGA perspective, we “may” be able to do things. Local government likes that; “must” is a bad thing unless somebody else gives us a big cheque for it.
I thank the Minister for accepting the arguments made by local government and by noble Lords earlier in this debate, and the Secretary of State for listening to our comments about excluding families with children from having to go for a fixed term. Personally, I am not bothered about five to 10 years. When you are talking about children, any fixed period is a waste of time. I will give noble Lords a quick run through. The average family in this country has 2.2 children. When people first get a council house they would have to have a child—or certainly be expecting one—because that is how rationed the supply is nowadays. The vast majority of new tenancies are only given to people with children. When that child is five they will go to primary school: there is no council leader in the country who is going to end that tenancy then, at five years.
When that child becomes 10 or 11 and starts secondary school, again, no council leader is going to evict the family from that property, providing the parents are behaving themselves. That will carry on for another five years—maybe seven if they go into the sixth form. So that is 18 years, at which point the 2.2 children are starting to have their impact, so that is probably 25 to 30 years. If we are seriously thinking that that family could occupy that property for 30 years on a short-term tenancy, why would we want them looking over their shoulder for 30 years? They are not going to invest in the property, the garden or the community. Clearly, that is not in the interests of the family, the neighbours, the taxpayer or anybody else. So I am seriously pleased that the Government have decided to look at the family situation and that they have committed to looking at other types of exclusions, without naming them. I am happy and hopeful that “others” might mean some more sensible people.
We are trying to address a serious problem: we have not got enough homes. I understand why the Government are doing this. There is a limited supply and there needs to be the ability to determine, on a case-by-case basis, that the right people have the right properties. But the only way that we are really going to fix this is by building more affordable social homes. For the last 40 years, successive Governments have failed to do what we all know is the right thing to do: we need to build more homes. This will not, I am afraid, add to the build. It might add to the supply at the edges for a few people, but it will not tackle the 1.2 million people on the waiting list—and it will certainly not be done at the expense of families.
My Lords I rise to support this group of amendments and, in particular, Amendments 80A and 80AZB. While I accept that it is the Government’s policy now to bring an end to secure tenancies, there are, as other noble Lords have said, several groups of people for whom the cutting short of a tenancy would have an extremely detrimental effect. As the noble Lord, Lord Porter, said, children in full-time education are extremely disadvantaged if they have to move schools unnecessarily frequently. Such moves are particularly damaging at what is known as the critical stage of education— years 10 and 11, when they are preparing for their GCSEs. When I was the lead on education for Somerset County Council, we always tried to ensure that looked-after children, in particular, were able to attend the same school during years 10 and 11, regardless of what changes there may have been to their individual care arrangements.
Children and young people will normally get only one chance at GCSEs and it is up to the rest of us to ensure that they are able to make the most of that chance and to not inhibit their progress with rules and regulations outside their control. There seems little difference between the wording of the amendments in the names of the noble Lord, Lord Bassam, and the noble Lord, Lord Porter—just the replacing of “must” with “may”.
Those in receipt of disability living allowance or personal independence payments are in another section of the community that needs security and protection, especially if their accommodation has previously been adapted to suit their individual needs. It would seem that the noble Lord, Lord Porter, has information about what exceptions the Minister is prepared to grant, but if they are not forthcoming—
My Lords, I was not intending to get involved in this debate but the noble Lord, Lord Kennedy, spotted me slinking out. Having been singled out, I will respond briefly. Unfortunately my notes have been whisked away, but my point was that there is a certain set of assets—council and social homes—and we all think the number of them should be increased. But we have to think about the distribution of those assets to the most needy households. That is a reasonable principle on which to found a welfare state. If a tenant is about to leave after a short tenancy they are, by definition, in less need than somebody who is on a waiting list.
Secondly, I checked the question asked by the noble Lord, Lord Kennedy, and the response to it stated:
“Local authorities do not receive subsidy from the Exchequer”.
That is a very important distinction. The new houses are being funded not by a grant from the Exchequer but by revenue from other council and social homes, coming via local authorities. I consider this to be public money. So again it is a question about the distribution of public money and how the asset that has been created is used for the benefit of the neediest.
My Lords, I thank the noble Lords, Lord Bassam, Lord Beecham, Lord Kennedy, Lord Watson and Lord Kerslake, and my noble friend Lord Porter, for their amendments. Turning first to Amendment 80, it would ensure that new fixed-term tenancies may have a longer term of 10 years in all cases.
As I said, we listened carefully in Committee, and I have found this further discussion at Report useful. A household’s circumstances can change considerably in 10 years, which is why the Government remain convinced that a maximum of five years should be the norm for most fixed-term tenancies. Indeed, 70% of flexible tenancies currently given by local authorities are five years in length. However, we recognise that there may well be situations in which longer-term tenancies are appropriate for tenants who have particular needs—which is why, as I said, we will bring forward an amendment at Third Reading to enable local authorities to grant longer-term tenancies of up to 10 years in certain circumstances. In answer to the question of the noble Lord, Lord Shipley, in the previous debate, I can say that this will include people with disabilities. We will be looking at other categories, and they will be in regulations which will be subject to the affirmative procedure, so there will be an opportunity to discuss the matter further, and we will of course have ongoing discussions in the run-up to Third Reading.
Amendment 80A aims to ensure that a fixed-term tenancy would cover the length of time for which a child is in full-time education. We appreciate the motivation behind this amendment. I absolutely agree with the noble Lord that it is important that children are brought up in a stable environment, and I agree that frequent moves can be disruptive to a child’s education, and of course we do not want that. As I said, we have listened to this debate and previous debates, so we are happy to give an undertaking to bring forward an amendment at Third Reading to give local authorities power to grant extended tenancies that cover the period for which a child or children are in full-time school education.
Amendment 80AZA would guarantee a lifetime tenancy in certain circumstances, including to people over pension age, where a property is or is designed to be adapted for a disabled person, and to tenants moving as a result of the removal of the spare-room subsidy. It is important that suitable accommodation is available for disabled people and that we make the best use of accommodation that is readily adaptable for people with access needs. Older people as well as disabled people have needs that change over time. Ensuring that tenancies are reviewed periodically will mean that landlords can consider carefully tenants’ continuing housing needs and move them to more suitable accommodation where appropriate. But as I said, we have listened to concerns and will introduce an amendment to allow councils to grant tenancies of up to 10 years in certain circumstances, which will ensure that they are able to provide greater stability for those with longer-term needs. As I said, we will ensure that that includes people with disabilities.
As for those affected by the removal of the spare-room subsidy, the Bill gives local authorities discretion to offer tenants a further lifetime tenancy in limited circumstances, and we have already made it clear that that would include cases where tenants need to move to smaller accommodation.
Finally, Amendment 80AZB would have a similar effect to Amendments 80A and 80AZA, allowing local authorities to grant longer tenancies where children are in school, and a lifetime tenancy to parents or carers of those in receipt of disability living allowance or personal independence payment. I hope that the commitment I have already given will reassure my noble friend and that we can work with him to ensure that he not only has hope, but sees some of the things that he wants.
With that, I ask noble Lords not to press their amendments.
I am grateful to the Minister. As she will know, we have the last day of Report on Monday and Third Reading is on Wednesday, which gives us very little time to consider amendments that the Government may table. They may be perfectly adequate —one lives in hope, if not expectation—but they may not, and we and other Members may want to table amendments for Third Reading, so we really need to know what the Government are doing by Monday at the latest, because no amendments can be tabled after Tuesday. If we can have an assurance about the timing, that will be very helpful.
We have had a wonderful time, have we not? I thank everyone who has spoken in this short debate. I am hopeful about what we will see from the Government in the next few days; we can all agree that next week, we get to Third Reading. With that, I beg leave to withdraw the amendment.
Amendment 80 withdrawn.
80ZA: Schedule 7, page 130, line 8, at end insert “, or
(c) if required to do so by section 158(9B) of the Localism Act 2011 (which relates to transfer requests made before section (Secure and assured tenancies: transfer of tenancy) of the Housing and Planning Act 2016 comes into force).”
Amendment 80ZA agreed.
Amendments 80ZB to 80AZB not moved.
80AA: Schedule 7, page 135, line 3, leave out from “(4)” to end of line 4
Amendment 80AA agreed.
Amendment 80B not moved.
Clause 114: Succession to secure tenancies and related tenancies
Amendment 81 not moved.
81ZA: After Clause 114, insert the following new Clause—
“Secure and assured tenancies: transfer of tenancy
(1) The Localism Act 2011 is amended as follows.(2) In section 158 of the Localism Act 2011 (secure and assured tenancies: transfer of tenancy)—(a) in subsection (3)(a), for “not a flexible tenancy” substitute “an old-style secure tenancy”;(b) in subsection (4)(a), for “is a flexible tenancy” substitute “is not an old-style secure tenancy”;(c) omit subsection (6);(d) in subsection (7), for “fifth” substitute “fourth”;(e) for subsections (8) and (9) substitute— “(8) The new tenancy is to be granted on whatever terms the landlord determines.(9) A landlord must, on request by a relevant tenant, inform the tenant of the terms on which a new tenancy will be granted to that tenant.(9A) Subsection (9B) applies in a case where—(a) the request was made before section (Secure and assured tenancies: transfer of tenancy) of the Housing and Planning Act 2016 came into force, and(b) one or more of the landlords had not yet complied with the request when that section came into force.(9B) In that case any new tenancy granted in pursuance of this section to a relevant tenant whose existing tenancy is an old-style secure tenancy, or an assured tenancy that is not an assured shorthold tenancy, must be—(a) an old-style secure tenancy, or(b) an assured tenancy that is not an assured shorthold tenancy,according to the landlord’s capacity to grant a tenancy of either kind.”(3) In section 159 (interpretation of section 158 etc), in subsection (6), omit paragraph (b).”
Amendment 81ZA agreed.
Schedule 8: Succession to secure tenancies and related tenancies
Amendments 81ZB to 81ZE
81ZB: Schedule 8, page 143, line 31, after “tenancy” insert “(“the old tenancy”)”
81ZC: Schedule 8, page 143, line 39, leave out from “years” to end of line 40
81ZD: Schedule 8, page 143, line 40, at end insert—
“(2C) Where a possession order was in force in relation to the old tenancy—(a) the possession order is to be treated, so far as possible, as if it applied in relation to the new tenancy, and(b) any other court orders made in connection with the possession order are also to be treated, so far as possible, as if they applied in relation to the new tenancy.(2D) In subsection (2C) “possession order” means an order for possession of the dwelling house.”
81ZE: Schedule 8, page 146, line 14, leave out from “years” to end of line 15
Amendments 81ZB to 81ZE agreed.
Amendment 81A not moved.
82: Before Clause 115, insert the following new Clause—
“Electrical safety standards for properties let by private landlords
(1) The Secretary of State may by regulations impose duties on a private landlord of residential premises in England for the purposes of ensuring that electrical safety standards are met during any period when the premises are occupied under a tenancy. (2) “Electrical safety standards” means standards specified in, or determined in accordance with, the regulations in relation to—(a) the installations in the premises for the supply of electricity, or(b) electrical fixtures, fittings or appliances provided by the landlord.(3) The duties imposed on the landlord may include duties to ensure that a qualified person has checked that the electrical safety standards are met.(4) The regulations may make provision about—(a) how and when checks are carried out;(b) who is qualified to carry out checks.(5) The regulations may require the landlord—(a) to obtain a certificate from the qualified person confirming that electrical safety standards are met, and(b) to give a copy of a certificate to the tenant, or a prospective tenant, or any other person specified in the regulations.(6) In this section—“premises” includes land, buildings, moveable structures, vehicles and vessels;“private landlord” means a landlord who is not within section 80(1) of the Housing Act 1985 (the landlord condition for secure tenancies);“residential premises” means premises all or part of which comprise a dwelling;“tenancy” includes a licence to occupy (and “landlord” is to be read accordingly).”
Amendments 83 to 91 (to Amendment 82) not moved.
Amendment 82 agreed.
92: Before Clause 115, insert the following new Clause—
“Electrical safety standards: enforcement
(1) Regulations under section (Electrical safety standards for properties let by private landlords) may provide for covenants to be implied into a tenancy.(2) Regulations under that section—(a) may make provision about the enforcement of a duty imposed by the regulations;(b) may confer functions on a local housing authority in England.(3) The provision that may be made about enforcement includes provision—(a) requiring a landlord who fails to comply with a duty imposed by the regulations to pay a financial penalty (or more than one penalty in the event of a continuing failure);(b) conferring power on a local housing authority to arrange for a person to enter on the premises, with the consent of the tenant, to remedy any failure by the landlord to comply with a duty imposed by the regulations.(4) The provision that may be made in reliance on subsection (3)(a) includes provision—(a) about the procedure to be followed in imposing penalties;(b) about the amount of penalties;(c) conferring rights of appeal against penalties; (d) for the enforcement of penalties;(e) about the application of sums paid by way of penalties (and such provision may permit or require the payment of sums into the Consolidated Fund).(5) The provision that may be made in reliance on (3)(b) includes provision—(a) about procedural matters;(b) enabling a local housing authority to recover from the landlord any costs incurred by it in remedying the failure;(c) about the application of costs recovered (and such provision may permit or require the payment of sums into the Consolidated Fund).(6) In this section “local housing authority” has the meaning given by section 1 of the Housing Act 1985.”
Amendment 92 agreed.
Amendment 93 had been withdrawn from the Marshalled List.
Clause 115: Assessment of accommodation needs
93A: Clause 115, page 53, line 11, at end insert—
“(c) separate plots on which gypsies, travellers and travelling showpeople can have both residential accommodation and space for the storage of equipment”
My Lords, I move the amendment, which is in my name and that of the right reverend Prelate the Bishop of St Albans, the noble Baroness, Lady Bakewell of Hardington Mandeville, and my noble friend Lady Whitaker, and shall speak to Amendment 94, in the names of my noble friend Lady Whitaker and the noble Baroness, Lady Bakewell.
The amendments, which were discussed in Committee, are designed to make explicit reference to the housing and other needs of the Gypsy and Traveller communities. The Housing Act 2004 required housing authorities to assess the accommodation needs of Gypsies and Travellers and allowed the Secretary of State to provide guidance on how this duty has to be carried out. That was effected in 2007.
The Bill dispenses with that requirement on what I can only regard as the specious grounds that it is unnecessary in the light of the fact that housing authorities are under a general duty to consider housing needs and that the Government are consulting on guidance to local authorities in relation to Gypsies and Travellers. As I pointed out in Committee, however, the 2004 Act provision was promoted because it was apparent that the requirement of the earlier Housing Act 1985 on councils to consider the housing needs in their district with respect to the provision of further housing accommodation was not being implemented for this exceptional community. In reality, in too many areas, no provision was being made at all, or some of it was patently inadequate. I cited at the time the views of the Planning Officers Society, which believes that the change will provide an excuse for reluctant authorities not to make provision.
Concerns were also expressed by the All-Party Parliamentary Group for Gypsy, Travellers and Roma, the Catholic Association for Racial Justice, the chairman of the GLA Housing Committee, and the eminent QC Mark Willers, and important observations were made by the EHRC. The latter observed that the rate of homelessness in the community was as much as 20% and that the provision in the Bill might well be in breach of Article 8 of the convention, Articles 4.2, 5 and 27 of the European Framework Convention for the Protection of National Minorities, and Article 2 of the International Covenant on Civil and Political Rights. It pointed out that the useless impact assessment in this Bill—the adjective is mine, not the commission’s—failed to deal with the equality impact, despite this actually being required by Section 149 of the Equality Act.
Deep concerns were expressed in Committee by the right reverend Prelate the Bishop of Southwark and the noble Baronesses, Lady Whitaker and Lady Young of Old Scone, and the noble Lord, Lord Stunell. The noble Lord, Lord Younger, who is to reply tonight, sought to allay these profound misgivings in Candide-like fashion, but it is impossible to conclude that the Government—if not the Minister personally, and I acquit the Minister personally—have not been motivated by the desire to mollify those who simply do not want provision to be made for this small and vulnerable community.
Replying to a letter from the Chair of the GLA Housing Committee protesting about the proposed change, the noble Baroness, Lady Williams, stated that,
“the clause seeks to remove the perception that, because Gypsies and Travellers have specific mention in legislation, they somehow receive more favourable treatment”,
that the Government want councils to assess the needs of communities as a whole and that,
“Gypsies and Travellers are not separate members of our communities”.
With all due respect to the noble Baroness, who is happily not in her place at this moment, this is simply disingenuous. They are groups with special needs that have too often been ignored, hence the 2005 Act. The Bill’s provision is a sop to those who do not wish to recognise these special circumstances.
In Committee, I referred to an organisation called Planning Direct, which actually boasted of its success rate of 100% in preventing the development of Gypsy and Traveller sites for parish councils. It is that approach that the Bill will be interpreted as implicitly supporting, whatever emollient words Ministers might utter. How much better it would be if they endorsed the positive and, as it turns out, cost-effective policies of councils such as Leeds, which take their responsibilities under the 2005 Act seriously, to the benefit not only of the Gypsy and Traveller communities but of society as a whole.
It really is important that the Government acknowledge that it is necessary to cater for the needs of these communities. Simply assuming that they will be catered for by merging them into the general provisions of the Housing Act does not meet the circumstances of the case. Too often, there is hostility at local level to such provision, which has to be sensitively sited and developed—I quite understand that—but, frankly, what the Government are doing here is going to make it more difficult for the needs of this group to be met and easier for people to object to it. It will provide cover for a rather unpleasant streak in our social and political life, and I hope the Government will think again.
My Lords, I will also speak to Amendment 94. I support wholeheartedly the comments of the noble Lord, Lord Beecham. In Committee, we had a very positive and informative debate on the need to provide for the accommodation needs of people whose lifestyles, culture and ethos are of a nomadic nature. It is unfortunately the case that Gypsies, in particular, suffer prejudice and abuse on a scale that would be simply unacceptable if directed towards any other section of our communities.
Different sections of the travelling communities have their own ethos, values and beliefs, which make it difficult, and often impossible, for them to live together in harmony on the same site. This makes it imperative for there to be separate sites for each group. We are now seeing sites where second-generation Gypsies are living and where great pride is taken in the appearance of the site. These sites are their homes, from which they can access health services and education, a luxury that continual moving on hinders. In the past, Gypsies and others travelled to access employment, often associated with agriculture and horticulture. That traditional employment is no longer available in the same quantities, requiring more permanent sites from which to access employment of a different nature. This does not mean that they are moving away from a nomadic lifestyle and should be forced into bricks and mortar, which does not meet their ethnic or cultural needs. Often the homeless—non-Gypsies—are reported as being accommodated by some local authorities in caravans on Gypsy sites. This is regrettable and a breach of planning conditions that stipulate that the site is for those of Roma Gypsy origin only.
The Welsh Assembly has grasped the nettle of site provision by requiring local authorities to demonstrate that they have made adequate provision for a five-year supply of new sites. It is possible to provide sites at no cost to the public purse, as is the case in South Somerset. Gypsies and travelling show people make minimal use of social services, as they look after their own. It is their culture to take care of their elderly themselves.
I turn now to the issue of the storage of equipment on sites. This is something of a red rag to a bull on Gypsy sites. Equipment is not stored on each of our local authority family pitches, as this would be a breach of fire regulations and needs to be kept separate. Travelling show people do, however, by the very nature of their business, need more space for the storage of equipment. South Somerset District Council is ahead of the curve in meeting the needs of Gypsies and Travellers in their local plan. If Gypsies and Travellers have the money to provide their own sites, why should they be on local authority sites? Most Gypsy families are local to their areas and travel within a 25-mile radius, but they will move on if forced to. Priority should be given for local connections to the area, in our case Somerset. This has not led to an influx of Travellers.
The public prefer allocations of smaller sites, as this prevents large numbers in one area. In Committee, we heard eloquently from the noble Lord, Lord Lansley, of the problems a large site caused near him. Small sites prevent the settled community from feeling dominated by large concentrations. There is a whole host of brownfield areas around the country where a small corner could adequately accommodate Gypsy and Traveller sites. MOD redundant airfields are ideal, as the hard standing is already there. More imagination is needed in dealing with the needs of Gypsies, Travellers and travelling showmen. I support these amendments and look forward to the Minister’s response.
My Lords, I added my name to Amendments 93A and 94, powerfully advocated by my noble friend Lord Beecham and the noble Baroness, Lady Bakewell of Hardington Mandeville. I added it on the clear basis that, unless Gypsies and Travellers—words which, by the way, should begin with capital letters, as recognised ethnic categories—are explicitly cited in the statute, along with travelling show people, local authorities will simply ignore their specific needs and airbrush them out of their reckonings, as they have done for so long. I will not rehearse the arguments made so powerfully in Committee, which were not really addressed in their nub and gist by the Government. Far from simplifying the law if the reference is omitted, as the noble Viscount, Lord Younger, said, in Committee, it will make it less precise and more open to fudge. It would be still better, of course, if this repeal were not in the Bill, which is what every single member of the Gypsy, Traveller and travelling show people communities to whom I have spoken thinks.
If the Government cling to their ideological insistence that equality is served only by flattening out difference, my noble friend’s amendments would relax the framework by proposing a planning policy rather than a statutory definition. There will still be a need, of course, to improve the Government’s definition of Gypsies and Travellers in this planning policy guidance so that those who have been forced to give up their traditional nomadic way of life through the absence of sites are not excluded. I hope that the Minister can give us some comfort on this. I urge him to accept the amendment and avoid the prospect of further judicial review.
My Lords, I shall contribute briefly to this short debate. I spoke in Committee to support the Government’s Clause 115, and I shall not repeat all of that, but it remains true—I am convinced of this by reference to local circumstances that I know well—that local authorities will continue to undertake an objective assessment of need for their Gypsy and Traveller communities and do so on the basis of that need and provision for that need and a five-year supply in a way that will genuinely respond to that need while giving greater reassurance to all the community that all their housing needs will be assessed on a similar objective basis. However, what we are looking at now is an amendment to require local authorities to look at very specific characteristics of sites that have to be accommodated. Obviously, that relates to caravans and houseboats, but it seems to me that there is an issue relating particularly to travelling show people, whom I know well and whom we accommodated close to where I live, in one of their more important sites. It is a difficulty with finding sites that can accommodate a community of people who have to have both residential accommodation and the capacity to store substantial equipment. That is particularly important for travelling show people.
Could my noble friend Lord Younger, in responding to the debate, say between now and Third Reading, if he cannot accept this amendment—and I can see why he might not—whether he will at least think about whether there is are specific characteristics that could be specified in the same way in the legislation, as they are for any member of the community who requires a site for caravans or houseboats on inland waterways?
My Lords, I support the amendment and support the words of my noble friend Lady Bakewell and the noble Lord, Lord Beecham. For two years, I was a Minister in the department with the responsibility for Gypsy policy. At that time, I paid a visit to South Somerset to look at some of the provision there, and I very much endorse what my noble friend Lady Bakewell said about how that council has addressed the issue. It is worth recalling, as I said in Committee, that a large majority of Gypsy and Traveller families are given—or have got, since given is perhaps not the right word—suitable accommodation on sites and in locations acceptable to communities. As the noble Lord, Lord Lansley, said, in many cases local authorities around the country have accepted the need to do that and have done it willingly and effectively. But we also heard evidence in Committee—and I certainly saw evidence as a Minister—that many local communities and some local councils will do whatever they need to do to avoid facing up to their responsibilities in this respect. As a recent incident on the rugby field has shown, there is still natural, casual racism in speaking about and to Gypsies and Travellers. That certainly has an impact at the community level on the way in which policy is applied.
It is a serious backward step to have this clause in the Bill at all, but I hope that the Government can support these amendments or something of a like nature. The noble Lord, Lord Beecham, described the clause as a sop to those who might wish to have discriminatory policy for the public provision of housing sites. I think that it is worse than a sop—I think that it is a gift to those who want to pursue a discriminatory housing policy. It was a very powerful lever that the national policy framework required Gypsy and Traveller provision to be part of the five-year strategic housing plan that local authorities bring forward. Gently to correct my noble friend Lady Bakewell, the Welsh Assembly has indeed got hold of this issue and insisted on a five-year supply being built in, but it is already the law in England that housing authorities should do that, and Clause 115 actually takes that provision out. So I would very much like your Lordships to give consent to anything that we can do to rescue that, and I very much hope that the Government respond.
I finish by saying that there is trouble with Gypsies; it is overwhelmingly caused, when it arises, by Gypsies who have inadequate housing and cannot find a place to stay. Therefore, they do what they can informally, often in a very disruptive way for local communities. The solution is not to chase them around the country but to provide them with the sites that they need in places that are appropriate so that they can live in harmony with the fixed or settled community, so we can have what we all want—a harmonious relationship between all the groups in England.
My Lords, I very much take on board the point made by the noble Lord, Lord Lansley, about showmen and the storage of their equipment—and we heard that from the other side of the House, too. I would like to elaborate on one very important point. I am sure that the Government wish to diminish prejudice and friction between communities, Travellers and show people. Where there are no sites provided—and I have had some experience of that in mid-Wales—the community will tend to feel forced to go on to inappropriate bits of public land, and on to private land. It is very much more difficult for individuals and private landlords to enforce the law and control what happens. It is easier for a public authority to do so. For that reason, they must not usurp their responsibilities but must actually answer them.
My Lords, I have found it helpful to have a further discussion on this matter, now that we are at Report. I listened carefully to the debate in Committee as well. All Members of this House are, I am sure, supportive of ensuring that the accommodation needs of Gypsy and Traveller communities are properly considered by local authorities. I have made it clear that this clause does not remove that duty. Local authorities will still consider the needs of these communities, and guidance has been provided to that effect.
I begin with the amendments, tabled by the noble Lord, Lord Beecham. I welcome the intentions of ensuring that Gypsies, Travellers and travelling show people have their needs considered, but I hope I can provide sound assurances that this clause does not remove that duty to do so. The clause makes clear that the needs of those persons who reside in or resort to the area, with respect to the provision of caravan sites and moorings for houseboats, are considered as part of the review of housing needs. This would include all those who are assessed at present and potentially those who simply choose to live in a caravan, irrespective of their cultural traditions or whether they have ever had a nomadic habit of life.
We recognise that for many, but for travelling show people in particular, this assessment needs to include consideration of not only residential accommodation but space for the storage of equipment. That is why we have published draft guidance that makes this explicit. Furthermore, Planning Policy for Traveller Sites sets out that local planning authorities should have regard to the need of travelling show people for mixed-use yards to allow residential accommodation and space for the storage of equipment.
While we do not consider these amendments necessary, even on Report we are in listening mode. We will ensure that the concerns raised are considered when finalising the guidance and that the specific needs of travelling show people for storage space continue to be clearly reflected. I hope I have reassured the noble Baroness, Lady Bakewell, the noble Lord, Lord Stunell, and my noble friend Lord Lansley to some extent, although probably not fully.
The definition in Planning Policy for Traveller Sites relates to the provision of sites and is relevant for those seeking planning permission for Traveller sites. It is based on proof of nomadism and ensures that planning provision relates to specific land-use requirements. The duty in the Housing Act is about assessing the housing and accommodation needs of all the community and those who resort to it, including those with or without an existing nomadic way of life and those who wish to resort to caravan and houseboat dwelling. We would not wish to align the housing definition with the planning definition as it would limit the scope of the assessment to those who proved an existing nomadic lifestyle.
Noble Lords and others have quite rightly raised concerns about human rights, and we are ever mindful of our obligations under domestic and international law with regard to the treatment of protected groups. I shall say a little more in a second about this. Before proposing this clause, Ministers gave very careful consideration to their public sector equality duties and to the need to ensure that local authorities understand their duty to assess the needs of those living in houseboats and caravans. This includes those with protected characteristics, such as Romany Gypsies and Irish Travellers, for whom it is recognised that caravan dwelling is a cultural part of their identity. We have therefore published draft guidance explaining how the needs of such groups should be considered under this revised legislation. The department is engaging with relevant stakeholders, who have been provided with a copy of the draft guidance, and officials will hold a liaison group meeting with them in June. The draft guidance has also been circulated to all local planning authorities through a chief planner letter. We want local authorities to assess the needs of everyone in their communities, and our clause emphasises that Gypsies and Travellers are not separate members of our communities. Local housing authorities will be able to consider how best to assess that need.
I shall answer some queries raised. The noble Baroness, Lady Whitaker, stated that local authorities will ignore the needs of Gypsies and Travellers or are minded to do so. Under the public sector equality duty, local authorities are required to ensure that their local plans address the needs for all types of housing and the needs of different groups in the community, including the groups that we have been discussing.
The noble Lord, Lord Beecham, said that the equality impact assessment failed to deal with equality impacts.
I thank the Minister for that response, but will he take it a little further? The ease with which it is possible to avoid provision for Gypsies and Travellers in an area is greater than for the fixed community simply because their existence is denied. A travelling community which happens to be somewhere else at the time never has provision made, and Gypsies never quite seem to be where the surveyors are doing their work. Will the Minister answer that question?
Surely the noble Lord knows that that is not the case. He used to be in the department where surveys of the needs of Gypsies and Travellers are done. Surely the settled community is the one that will have less provision. We have just heard that there are 1.25 million people on the registered social housing waiting list. There will not be that many Gypsies and Travellers waiting for a pitch.
I believe I answered the question earlier by saying that there is an obligation to look at the needs of all the population including, particularly, those of Gypsies and caravan and houseboat dwellers. If local authorities are failing in their duty fully to assess—I am sure there are very few—the law is in place for redress to take place.
I was attempting to answer a question raised by the noble Lord, Lord Beecham, who said that the equality impact assessment failed to deal with the equality impact. The decision to introduce the clause was made with due regard to the Equality Act 2010. There is a requirement for local authorities to assess the needs of everyone, including those with protected characteristics. As I said earlier, this clause does not change that.
The noble Baroness, Lady Bakewell, raised the experience in Wales, where there is a legal duty to provide sites. We do not believe that this is necessary because our planning policy for Traveller sites is clear. Local planning authorities should identify and annually update a supply of sites to provide five years’ worth against locally set targets. I hope that also answers more fully the question from the noble Lord, Lord Stunell.
Finally, the noble Baroness, Lady Bakewell, asked whether the clause contravenes legal obligations on equalities. I may have addressed this through answering the question from the noble Lord, Lord Beecham, but the decision to introduce the clause was made with due regard to the matters set out in the Equality Act. I hope that, with these explanations and assurances, the noble Lord will withdraw his amendment.
My Lords, I listened with interest to the noble Viscount. It seems to me that the Government are adopting a Janus-like posture, wanting to give one impression to the community affected and another to the general community. I do not find that particularly palatable. We would be sending the wrong message if we simply accepted the Government’s position, and I wish to test the opinion of the House.
Amendment 94 not moved.
Amendment 95 had been withdrawn from the Marshalled List.
Amendment 95A not moved.
Clause 117: Financial penalty as alternative to prosecution under the Housing Act 2004
95B: Clause 117, page 54, line 37, leave out “as an alternative” and insert “in addition”
My Lords, Amendment 95B in my name and that of my noble friend Lord Beecham proposes to leave out the words “as an alternative” and add “in addition” to the list of the breaches in Schedule 9 to the Bill. Our reason for tabling this amendment is that the offences here do not justify being downgraded, and if left unamended the effect of the schedule would be just that: they would be downgraded. It would be helpful for me in deciding whether I should divide the House if the noble Viscount could explain very clearly why he believes that these offences should be downgraded and left to a fine by the local authority. I cannot see how that will benefit anyone, or that leaving the courts out of this process would be a good thing. I beg to move.
My Lords, as I have said in earlier Committee and Report debates, the measures in Part 5 mark the Government’s commitment to tackle rogue landlords and agents as well as poor practice and standards in the private rented sector. The amendments I shall move in the next group respond to issues raised in Committee when we debated Part 2 and were debated last week, and they clarify issues that were of concern to your Lordships.
Before then, however, Amendment 95B, tabled by the noble Lords, Lord Beecham and Lord Kennedy, would allow the local authority to pursue both a civil penalty and a criminal conviction for the same housing offence. The Bill as drafted provides local housing authorities with a choice on whether they want to go down the civil penalty or prosecution route depending on the seriousness of the offence and the circumstances surrounding it.
It would be disproportionate to use both regimes in relation to the same conduct. In some less serious cases, such as a first offence involving a relatively minor breach of housing legislation or when a landlord has recognised that they need to improve and have taken steps to do so, a local authority may prefer to use the civil penalty route, but for the real rogues that operate in the sector, which we have discussed at length, prosecution will still be important as that can ultimately lead to a banning order.
We will be issuing guidance for local authorities on the workings of this and the Secretary of State will of course be able to use the database of rogue landlords and agents to get a picture of how local authorities are using their powers. I hope that, with this explanation, the noble Lord will feel able to withdraw the amendment.
I thank the Minister for his response. As I said, generally the provisions in respect of the private rented sector are quite good in the Bill, with one or two exceptions; the exceptions have come with the Government’s desire to take the courts out of these processes. I have not been at all satisfied or persuaded by the comments from the Minister, so I would like to test the opinion of the House.
Schedule 9: Financial penalty as alternative to prosecution under Housing Act 2004
96: Schedule 9, page 148, line 12, after “satisfied” insert “, beyond reasonable doubt,”
My Lords, I now turn to Amendments 96 and 97, which have been tabled in response to issues raised by noble Lords during the course of debate. These confirm that the local housing authority will need to apply the criminal standard of proof to any action taken against a landlord or agent. Amendment 96 addresses concerns raised by the Delegated Powers and Regulatory Reform Committee about banning order offences, which were echoed and reinforced in Committee. Amendment 97 deals with appeals to the First-tier Tribunal against financial penalties.
A local housing authority which intends to impose a financial penalty must serve a notice of intent setting out both the reason for imposing the penalty and the amount of the penalty. The reasons must reflect that the local housing authority is satisfied beyond reasonable doubt that the offence complained of has been committed. The department will be issuing guidance to local housing authorities on financial penalties, including the circumstances in which a local authority should consider imposing such a penalty. I beg to move.
Amendment 96 agreed.
97: Schedule 9, page 150, line 27, at end insert—
“( ) An appeal under this paragraph—(a) is to be a re-hearing of the local housing authority’s decision, but(b) may be determined having regard to matters of which the authority was unaware.”
Amendment 97 agreed.
Consideration on Report adjourned.
House adjourned at 8.36 pm.