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Lord Monkswell: My Lords, I support my noble friend's amendment. It may be useful to the House if I try to explain some of the historical background to the situation with which we are faced in slightly different terms from those explained by my noble friend.

I shall not give an historical reprise of the whole of the past 15 years, but perhaps the House will bear with me. In the early 1980s, the subsidy that the Government provided to local housing authorities was massively cut. There were two consequences. One was that the resources available for housing management and maintenance were reduced which resulted over the years in a decline in the standards of management in many areas. But it also effectively required a massive increase in council house rents. That prompted local resistance--local housing authorities are after all elected by the local communities--with the result that finances were squeezed even more.

It has been realised that housing benefit pays for a lot of council house rents and therefore an increase in rents is effectively covered by housing benefit. That is part of the reason for the massive increase in housing benefit payments over the past few years. Local housing authorities have attempted to catch up.

The net result is that in most local authority areas the resources that have become available for housing management have increased. It is recognised that there needs to be an increase in resources to improve the standards of local authority housing management. That has effectively taken place in the vast majority of local housing authorities throughout the country.

We also have to recognise what I would describe as the almost personal relationship between housing management and tenants. Tenants get to know the local senior housing officers. A relationship develops which, as things improve, is positive, mutually beneficial and useful for the development of local authority housing. One of the difficulties is that compulsory competitive tendering creates a risk that a new housing management team will take over. That personal relationship, which can be very beneficial, is at risk of being lost. Part of the justification, and the reason for my support, for my noble friend's amendment is that it will enable tenants to hang on to something that is very beneficial to them, if they feel that way. I recognise that there may be alternative circumstances where there may be examples of bad housing management and tenants recognise that there is a need to get a new team to do a better job. In that case they would vote accordingly. This amendment effectively protects tenants and in a very real sense ensures effective local housing management. I hope that the Government will accept it.

Lord Lucas: My Lords, both the noble Lord, Lord Williams of Elvel, and the noble Baroness, Lady Hamwee, have said that they will not discuss CCT in general and that they wish to keep the debate to the

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subject of this particular amendment. I am sorry about that. If we were to discuss CCT in general we might have a chance to agree about something because I am sure that both noble Lords will agree that this is yet another successful Conservative policy which has, at last and at length, been adopted by the opposition parties, having seen the benefits that it can bring to local authorities and the amount of cash that can be freed for other activities.

From now on I shall confine myself to the amendment, as the noble Lord, Lord Monkswell, did, eventually.

Amendment No. 123 would, in effect, allow tenants to veto any proposal by a local authority to delegate its housing management functions either voluntarily or under compulsory competitive tendering. It is important that there should be some form of balancing check to secure the best interests of tenants where local authorities choose to delegate housing management. However, we believe that the current arrangements for tenant consultation achieve this more effectively than a power of veto.

The veto is a blunt instrument which allows tenants a stark choice between saying yes or no. Tenants already have considerable scope under current arrangements directly to influence constructively and positively the ways in which their homes are managed. Tenants are actively involved in drawing up specifications, setting standards of service, evaluating tenders and selecting contractors. Local authorities also have to involve them in monitoring the performance of the manager, whether this is an external contractor or the local authority's in-house team under compulsory competitive tendering.

Many authorities already have extensive consultation arrangements in place and are able to follow guidance that was issued two years ago. This guidance was issued following consultation with, among others, the local authority associations, local authorities, private sector contractors, the Chartered Institute of Housing and tenant advice agencies. It aims to set out the principles we would expect authorities to follow in setting up their own local consultation arrangements and we are keeping this guidance under review. We have existing powers to make regulations imposing consultation requirements on local authorities but do not consider it necessary to make any regulations at present because local authorities have been following this guidance, and in many cases going beyond what we expected.

We have included a provision in paragraph 3 of Schedule 16 to the Bill to correct a defect in the existing powers to make regulations under Sections 27A and 27AA of the Housing Act 1985 governing the consultation arrangements of local authorities with their tenants. This provision covers the same ground as the existing Sections 27A and 27AA but also allows regulations to be made for the case where the local authority continues to carry out the management itself following a compulsory competitive tendering exercise.

Tenant consultation is central to compulsory competitive tendering of housing management and has been a key factor in improving management standards. The CCT process is carried out in accordance with a

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strict statutory framework. It is open and transparent. If the local authority in-house team do not come up with the most competitive bid the authority has to delegate its housing management to another contractor. The authority cannot ignore the process.

Where local authorities decide to delegate their management voluntarily, the Secretary of State's consent will not be forthcoming unless the authority has consulted their tenants in accordance with the Department of the Environment's guidance and complied with certain competitive tendering arrangements. We firmly believe that the benefits of competition and tenant consultation on specifications, and the subsequent monitoring of the manager's performance under the specification, fully safeguards the interests of tenants.

Delegation of housing management does not take away any of the existing rights of tenants. The properties remain in council ownership. As I have explained, tenants are now directly influencing the delivery of housing services through current consultation requirements. To impose an additional burden on authorities--in effect requiring them to ballot their tenants before any future contract is let--would be onerous and inappropriate. It would certainly cut across the arrangements put in place by those authorities which have already delegated housing management functions.

We are delighted by the way local authorities are responding in this area and are venturing into compulsory competitive tendering for their housing activities. We see no reason to interfere with the arrangements that have been put into place, which seem to us to be working very well, and to revert to a system which we left behind, as the noble Lord, Lord Williams of Elvel, suggested, some while ago and which to us seems no longer appropriate.

Lord Williams of Elvel: My Lords, the noble Lord, Lord Lucas, said that he would be glad to have a general debate on CCT. I, too, would be glad to have such a debate because, despite the party political broadcast which the noble Lord started with, we have some ammunition on our side.

But I shall confine myself to the amendment. It would not remove any of the existing rights of tenants to involvement or consultation in CCT. All it would do is to act as a final backstop where tenants feel that they really have to resist the operation of Conservative dogma, as the noble Lord would probably have put it. The noble Baroness, Lady Hamwee, was right in saying that the more involvement and agreement that there is with tenants, the more they will feel happy and satisfied with their housing management. By introducing this measure as a final backstop--in other words, to go back to where we were before the 1993 Act--is a sensible move. My noble friend Lord Monkswell said quite rightly that this amendment would help to protect tenants further than they are protected at the moment.

Again, we come back to the same point. There is a serious political difference between ourselves and the Government. We do not believe that this

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amendment would spoil any of those lovely Conservative ideas that the Government have imposed on local authorities; it would simply give tenants a backstop right to prevent their houses being managed by someone they did not want. There is a serious disagreement and the only way to resolve it is to ask for the opinion of the House.

3.29 p.m.

On Question, Whether the said amendment (No. 123) shall be agreed to?

Their Lordships divided: Contents, 73; Not-Contents, 152.

Division No. 1

CONTENTS

Acton, L.
Addington, L.
Allen of Abbeydale, L.
Archer of Sandwell, L.
Barnett, L.
Beaumont of Whitley, L.
Blackstone, B.
Blease, L.
Borrie, L.
Bruce of Donington, L.
Callaghan of Cardiff, L.
Carlisle, E.
Carmichael of Kelvingrove, L.
Carter, L. [Teller.]
Cocks of Hartcliffe, L.
David, B.
Dean of Beswick, L.
Donaldson of Kingsbridge, L.
Donoughue, L.
Dormand of Easington, L.
Dubs, L.
Elis-Thomas, L.
Ezra, L.
Farrington of Ribbleton, B.
Fitt, L.
Gallacher, L.
Geraint, L.
Gladwin of Clee, L. [Teller.]
Hampton, L.
Hamwee, B.
Haskel, L.
Hollis of Heigham, B.
Holme of Cheltenham, L.
Howie of Troon, L.
Jay of Paddington, B.
Jenkins of Putney, L.
Kennet, L.
Kilbracken, L.
Kintore, E.
Lockwood, B.
McIntosh of Haringey, L.
McNair, L.
McNally, L.
Mar and Kellie, E.
Mason of Barnsley, L.
Mayhew, L.
Meston, L.
Milner of Leeds, L.
Monkswell, L.
Morris of Castle Morris, L.
Nicol, B.
Rea, L.
Robson of Kiddington, B.
Rochester, L.
Sainsbury, L.
Seear, B.
Simon, V.
Smith of Gilmorehill, B.
Stallard, L.
Stoddart of Swindon, L.
Strabolgi, L.
Taverne, L.
Taylor of Gryfe, L.
Thomson of Monifieth, L.
Thurso, V.
Tope, L.
Tordoff, L.
Wallace of Saltaire, L.
Whaddon, L.
White, B.
Wigoder, L.
Williams of Elvel, L.
Williams of Mostyn, L.

NOT-CONTENTS

Aberdare, L.
Addison, V.
Ailsa, M.
Aldington, L.
Alexander of Tunis, E.
Alport, L.
Arran, E.
Ashbourne, L.
Astor of Hever, L.
Balfour, E.
Belhaven and Stenton, L.
Beloff, L.
Berners, B.
Blake, L.
Blaker, L.
Blatch, B.
Blyth, L.
Boardman, L.
Boyd-Carpenter, L.
Brabazon of Tara, L.
Bradford, E.
Brentford, V.
Bruntisfield, L.
Burnham, L.
Butterworth, L.
Caldecote, V.
Campbell of Alloway, L.
Campbell of Croy, L.
Carew, L.
Carnegy of Lour, B.
Carnock, L.
Carr of Hadley, L.
Carrington, L.
Chalker of Wallasey, B.
Charteris of Amisfield, L.
Chelmsford, V.
Chesham, L. [Teller.]
Clark of Kempston, L.
Cochrane of Cults, L.
Coleridge, L.
Constantine of Stanmore, L.
Cornwallis, L.
Courtown, E.
Cox, B.
Cranborne, V. [Lord Privy Seal.]
Crathorne, L.
Cross, V.
Cuckney, L.
Cullen of Ashbourne, L.
Cumberlege, B.
Dacre of Glanton, L.
Davidson, V.
De Freyne, L.
Dean of Harptree, L.
Denham, L.
Denton of Wakefield, B.
Derwent, L.
Dundonald, E.
Elles, B.
Elliott of Morpeth, L.
Elton, L.
Erne, E.
Erroll, E.
Ferrers, E.
Flather, B.
Gainford, L.
Gainsborough, E.
Gardner of Parkes, B.
Geddes, L.
Gisborough, L.
Goschen, V.
Gray of Contin, L.
Harding of Petherton, L.
Harmar-Nicholls, L.
Headfort, M.
Henley, L.
HolmPatrick, L.
Howe, E.
Hylton-Foster, B.
Ilchester, E.
Inchcape, E.
Inglewood, L.
Ironside, L.
Johnston of Rockport, L.
Kimball, L.
Kinnoull, E.
Lauderdale, E.
Lawson of Blaby, L.
Leigh, L.
Lindsay, E.
Long, V.
Lucas, L.
Lucas of Chilworth, L.
Lyell, L.
McConnell, L.
Mackay of Ardbrecknish, L.
Mackay of Drumadoon, L.
Macleod of Borve, B.
Marlesford, L.
Masham of Ilton, B.
Mersey, V.
Middleton, L.
Miller of Hendon, B.
Mottistone, L.
Mountevans, L.
Mowbray and Stourton, L.
Munster, E.
Murton of Lindisfarne, L.
Noel-Buxton, L.
O'Cathain, B.
Orkney, E.
Orr-Ewing, L.
Oxfuird, V.
Palmer, L.
Park of Monmouth, B.
Pearson of Rannoch, L.
Pender, L.
Pilkington of Oxenford, L.
Platt of Writtle, B.
Pym, L.
Quinton, L.
Rankeillour, L.
Rawlings, B.
Renfrew of Kaimsthorn, L.
Renton, L.
Robertson of Oakridge, L.
St. Davids, V.
Saltoun of Abernethy, Ly.
Sanderson of Bowden, L.
Sharples, B.
Shaw of Northstead, L.
Skelmersdale, L.
Somerset, D.
Stodart of Leaston, L.
Strafford, E.
Strange, B.
Strathclyde, L. [Teller.]
Suffield, L.
Suffolk and Berkshire, E.
Swinfen, L.
Swinton, E.
Terrington, L.
Thomas of Gwydir, L.
Trumpington, B.
Vivian, L.
Wade of Chorlton, L.
Waterford, M.
Whitelaw, V.
Wolfson, L.
Wyatt of Weeford, L.
Wynford, L.
Young, B.

Resolved in the negative, and amendment disagreed to accordingly.

10 Jul 1996 : Column 305

3.38 p.m.

Lord Williams of Elvel moved Amendment No. 124:


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