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Mr. Hayes: The hon. Gentleman knows that Conservative members of the Committee have repeatedly stated that the costs that the Bill will inevitably impose on local councils should be properly reflected in the grants given to them. My hon. Friend the Member for Poole and I have repeatedly suggested that the costs will be considerable and that the burden should not be underestimated. However, I make a prediction on which I invite the hon. Gentleman to comment: that if we prescribe the maximum, almost every local authority will regard it not as a maximum, but as a benchmark, and charge it. Mr. Green: The hon. Gentleman may have a point. We should perhaps consider going further and stop the Government setting a maximum fee at all, instead allowing local authorities to set the fee as appropriate. I am much more prepared to trust the judgment of local authorities, which know their local area better than central Government. After all, if the public do not like what councils are doing, they can throw them out. One reason why nobody votes in local elections is that they do not think that their council has any powers, so it is not worth bothering to vote for it. Mr. Hayes: The hon. Gentleman knows that, having served in it, I am a champion of local government. My hon. Friend the Member for Poole and I are well acquainted with the importance of the role of local authorities and councillors, but I want the hon. Gentleman to be clear. He is suggesting not only that we should reject my hon. Friend's amendment, but that no maximum should be set. In a fragile marketplace, that will sound a warning bell to every landlord in the country about Liberal Democrat intentions. Mr. Green: The hon. Gentleman says that it will send a warning bell. Let me put my case another way. I think that most local housing authorities take a responsible view of housing throughout their area, not just the bit that they or registered social landlords control, but the private sector rented accommodation and HMOs as well. He says that councils will say, ''We don't give a monkey's whether there are any private HMOs. We'll stick the charges up and get as much tax as possible off them, so that we can get the money.'' Maybe that is what Conservative-controlled local authorities would do, but many other authorities are far more responsible than that. Column Number: 214 The Government's approach, which is less prescriptive than that proposed by the Conservatives, is that nanny knows best. Clearly the Conservatives now back a nanny state, which worries me considerably. They have made it plain that, in authorities where the scheme proves expensive because there are very few HMOs to be licensed, it would have to be paid for through increases in council tax.
3.15 pmThere are severe problems in what the Conservatives are saying. I hope that the Government set the maximum fee at a level that enables them to cover the costs of the smaller authorities and, through guidance, indicate that they should not do anything when setting fees other than to meet the costs. That may be the way around the problem, but my concern is that the Government will set a maximum that will suit the big cities, while the smaller local housing authorities will not be able to meet their costs and will have to go elsewhere. As for meeting costs through Government grant, I do not think any local authority or many local voters believe that any Government properly compensate local councils through that grant when they give them a new duty. While this Government have not been great in that regard, I am not sure that it is an issue that the Conservatives will want to probe in too much detail. We do not support the amendments as they may have the effect of forcing up council tax levels in small authorities. Keith Hill: Before I deal with the amendments and the particular points raised by hon. Gentlemen during the debate, it may be helpful to the Committee if, as I have done in the past, I put the purposes of the clause and the effect of the amendments on those purposes into context. Clause 52 provides that an application for a licence must be made to a local authority in accordance with the requirements specified by that authority. In other words, subject to the regulations, an application must be made in accordance with the requirements specified. Importantly, the local authority can fix a fee for the consideration of licence applications that takes account of all its costs in running the licensing scheme. I will return to that point in a second. Clause 52(5) gives the appropriate national authority the power to make regulations specifying various matters about licence applications and how they should be made. That includes the contents and form of the application forms, the manner in which applications are made and the maximum fees that a local authority can charge. I have forwarded to Committee members a note of policy intent on what we expect the regulations to say. I should emphasise that that will provide some standardisation across all licensing regimes, an issue that we have frequently debated in this Committee and which will be welcome to the Committee, in order that landlords do not face completely different applications for different types of property in different parts of the country. I reassure Committee members that I am as keen as everyone else to ensure that landlords' costs are kept Column Number: 215 to a minimum. However, we also wish the licensing regime to become self-financing through the fee revenue received. We have already carried out initial work with the Local Government Association on the issue. The association represents all types of authorities including the smaller ones and I have no reason to believe—as the hon. Member for Ludlow alluded—that the interests of the smaller authorities have not been taken into account in the course of the initial work.As a result of that initial work, we expect fee levels to be capped at about £110 per unit—for example, per habitable bedsit. For a five-year licence, that amounts to a little more than 40p a week. I hope that the Committee will agree that that is not an unreasonable amount. Mr. Syms: The Minister has set out a likely maximum of £110. Is that at all variable between districts? For example, in a debate earlier today we talked about a property block in London. Let us consider a block of 100 properties, in which an inspection might be an all-day, two-day or even three-day job, which is rather different from the inspection of a block that has just a few people in it in a small town. Will the fee use a broad-brush approach so that there may be some inspections where the local authority loses money and some where it makes money? The fee of £110 would not be much for a large block in London but it might be an awful lot for a small place in Prestatyn. Is it a set fee for the whole of the district, or would there be some variation depending on the sort of property or on the amount of work that a local authority has to do? Keith Hill: I thought that the hon. Gentleman's reference to the quality of property in Prestatyn was gratuitous, and not in accordance with the generous and happy spirit that for the most part has prevailed in the Committee. I am convinced that there are some excellent properties in Prestatyn, which would be worth the full £110. Chris Ruane: Prestatyn is in my constituency. Denbighshire county council tried to operate a licensing scheme and was charging £60 per room. Surely that is more in line with the cost of thoroughly inspecting a property? Does the Minister not think that we are selling ourselves short at £110 per house? Keith Hill: My appetite for a visit to Prestatyn grows with each of my hon. Friend's interventions. However, we are talking about a maximum—a capped sum. I am grateful for the question put by the hon. Member for Poole about the possibility of variability across a district. That contributes to what I might describe as a mutual learning process in this Committee. The answer to his question is yes. There is provision for exactly that variability across districts. Matthew Green: The Minister is in danger of displaying the Office of the Deputy Prime Minister's new enthusiasm for capping. Did the Minister say that £110 is the maximum per bedsit? Would a property with several bedsits in it—several independent households—incur £110 per Column Number: 216 household, or would the £110 be imposed on the property, which could vary considerably in size? If the charge is per bedsit, the maximum for a six-bedsit property would be £660, rather than £110.Keith Hill: The hon. Gentleman is absolutely right. It is important that we are clear. We are talking about a charge per unit—per habitable room. However, I remind the hon. Gentleman and the Committee that there is local flexibility, and that the fee is a maximum fee; any local authority can charge less. The maximum fee will be set through secondary legislation, on which we will consult in due course. As part of their desire to keep fees low, the Government have already expressed their willingness to assist local authorities with start-up costs relating to the introduction of licensing. We estimate that about £13 million will be made available for that. I recognise that amendments Nos. 266, 267 and 268, tabled by the official Opposition, are probing amendments, but I point out that they would remove the discretion for local authorities to set a fee appropriate to their local circumstances; they would impose a fixed fee across all localities. I accept the case for seeking as far as possible a common approach among local authorities, but on this matter the case for local discretion is strong. A flat-rate national fee would have to be set at a level that ensured that all local authorities could finance their licensing regimes. The average cost of running schemes is likely to vary considerably, and we want local fees to reflect that. It would not be right for a local authority to make a profit from its licensing scheme. We expect local authorities to set much lower fees in certain circumstances—for example, for landlords who are already part of voluntary accreditation schemes; the cost of licensing such landlords would inevitably be lower.
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