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My Lords, these amendments are intended to support accreditation-and the noble Lord explained why he believes them necessary-but unfortunately they would have the opposite effect by undermining effective schemes that are already in place. Given this, I would ask the noble Lord to withdraw his amendment.
Lord Kennedy of Southwark: My Lords, I thank the noble Earl for his reply. However, I still think that there is an issue here that needs further consideration, so I hope that this will be kept under review. That said, I beg leave to withdraw the amendment.
Lord Best: Amendment 54 is in the name of the noble Lord, Lord Kennedy and myself. Currently, the Secretary of State is able to direct the regulator to set standards for social housing in certain areas. In a strictly limited number of cases, he is able to direct the content of these standards. Clause 163 of the Localism Bill seeks to strengthen his powers in this area, allowing him to shape the contents of standards regarding tenancy exchanges in which tenants can swap properties. The view within the housing world is that this is giving the Minister too many powers to direct the behaviour of social landlords. The danger of accumulating more and more powers in the hands of the Secretary of State is that eventually, as one Minister after another brings their own fresh and no doubt good ideas to bear, you are effectively nationalising the housing associations; they are becoming creatures of government. They then run the risk of being regarded by the EU and others as public sector bodies. If the housing associations are no longer independent bodies and are regarded as public sector agencies, then all their borrowing becomes public sector debt and we have lost one of the key elements in having a social housing sector that is outside of public sector control.
So I am very sympathetic to standards about exchanges and the mobility of labour, and to the Minister's hopes that housing associations will behave in a particular way, but laying this down, through direction to the regulator over these standards, does seem a step too far. I beg to move.
Earl Attlee: My Lords, Clause 163 is important in increasing mobility for social housing tenants who may wish to move for work, or to give care to or
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The noble Lord also raised the issue of public sector debt. While I am not undertaking to reflect on that and come back at a later stage, I will undertake to satisfy myself, through discussions with my officials, that the problem which the noble Lord alludes to does not exist. While I accept that some noble Lords view this as an overly bureaucratic approach, we believe that the benefits of increasing choice and mobility for social tenants must be the priority and that we should seek to deliver this better service for them.
Lord Best: I am grateful to the noble Earl for that response. I agree entirely that improving mobility and exchange schemes is a thoroughly commendable line to pursue. I think that I am now on my 23rd housing Minister since I started in this world. They have all had important ideas to add to the things that housing associations ought to do; it is just that in the end, if one is not careful, the cumulative effect is the creation of an agency that is simply a government bureaucracy. I am grateful for the noble Earl's reassurances and beg leave to withdraw the amendment.
Lord Kennedy of Southwark: My Lords, I will be as brief as possible in speaking to this group of amendments. My Amendment 55 seeks to designate an individual within the Homes and Communities Agency to be responsible for regulation. The amendment has the support of the National Housing Federation, and it is important because it seeks to avoid a conflict of interest between the HCA's regulatory and investment functions. It will help to ensure that regulatory issues can be addressed, even to the extent of formal legal proceedings, without compromising the investment function of the HCA, and vice versa. The HCA would of course
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Earl Attlee: My Lords, I am grateful for the way in which the noble Lord, Lord Kennedy of Southwark, succinctly moved his amendment. The Government are committed to ensuring the continued independence of the regulatory function once it transfers to the Homes and Communities Agency. However, our view is that the nomination of a single individual as a regulation officer would diminish rather than enhance regulatory independence. Rather than vesting the regulation function in an independent committee, these amendments, as the noble Lord explained, would confer the statutory powers on a single member of the HCA's staff. In moving his amendment, the noble Lord talked about the problem of a conflict of interest. However, this person could presumably be dismissed at any time by the HCA on normal employment grounds. It could prove difficult for a member of staff in that position to take decisions that were demonstrably independent of the HCA's other functions. In addition, where formal regulatory decisions are made by a properly constituted board or committee, there can be greater confidence that those decisions are broadly based and take account of the full range of relevant factors. I hope that the noble Lord will feel able to withdraw his amendment in view of my explanation.
Lord Best: My Lords, this amendment concerns the terms of appointment of members for the new regulation committee. The intention is that "unsuitable" should be removed so that those who are indeed unfit or unable to serve could be removed by the Secretary of State but not those whom the Secretary of State deems to be unsuitable. That is extending the power a step too far-again, a theme of the amendments that I am bringing forward. "Unsuitable" could imply people being removed from office on grounds that would be comprehensible to the Secretary of State. It would not ensure the independence of those people to argue and, if necessary, to be a nuisance within that committee. They might do that in fear that they would be regarded as unsuitable somewhere down the line.
The Bank of England's Monetary Policy Committee uses the terms unable and unfit to describe the powers for the removal of any members of that committee. Those words would seem sufficient for the regulation committee as much as for the Monetary Policy Committee, which has done well and which has had some members who have been quite happy to raise objections-and to be quite forceful in doing so-but who might have been regarded as unsuitable if there had been powers of ministerial intervention. This amendment simply seeks to lose "unsuitable". I beg to move.
Lord Newton of Braintree: My Lords, I cannot resist it, especially since I am well known to be classified as unsuitable by my Front Bench. I have some sympathy with the argument that has just been advanced. It is quite difficult to see what is not included in "unable" or "unfit" that is then covered by "unsuitable" that ought not to be covered. It depends on matters of judgment that could include political or personal judgment that would not be a proper consideration. I just want to know what is thought to be desirably covered by unsuitable that is not covered by the other words.
Lord Kennedy of Southwark: My Lords, the Opposition fully support the amendment moved by the noble Lord, Lord Best. The amendment seeks to correct the use of what can only be described as an odd and unnecessary use of the term unsuitable. Like the noble Lord, Lord Newton, we ask the Minister to address that specific point of why unsuitable is being used. There is much concern that the Government are taking a much wider view and a much wider power and have additional intentions of using it. I hope that the Minister either accepts the amendment or that we have a very clear explanation about what this does and does not mean.
The Secretary of State already has the power to remove someone who is unable or unfit. As the noble Lord, Lord Best, said, this is adequate for the Monetary Policy Committee of the Bank of England, so we on this side certainly think that it is good enough for the HCA regulation committee.
Earl Attlee: My Lords, it is important that the regulation committee is able to function effectively in order to retain the confidence of investors and the social housing sector. In extreme cases, it may prove necessary for the Secretary of State to intervene to remove a member of the committee to ensure that its crucial work is not jeopardised. "Unable, unfit or unsuitable" are fairly standard grounds and a nearly identical provision exists for membership of the boards of the existing social housing regulator and the Homes and Communities Agency.
In answer to my noble friend Lord Newton of Braintree and the noble Lord, Lord Kennedy of Southwark, a member may be able and fit to carry out his or her functions without being suitable to exercise them. This might arise, for example, if there was an irretrievable breakdown in the relationship between the member and the rest of the committee. A member
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Lord Kennedy of Southwark: My Lords, before the noble Earl sits down, does he see the problem that we on this side see: that somebody can be deemed unsuitable just because they are making a point that the others happen not to agree with? It is not filibustering but that they are making a perfectly valid point, which is not agreed with.
Earl Attlee: No, my Lords, that would not meet the test of what is unsuitable. If the Secretary of State tried to use his powers to say that someone was unsuitable because he or she disagreed with other members of the committee, he would leave himself vulnerable to judicial review.
Earl Attlee: My Lords, I would imagine that a committee could have very free and frank discussions, perhaps lasting all afternoon, without falling foul of the test of unsuitability. On the other hand, if a member of the committee regularly interfered with the operation of the committee so that it could not function, the Secretary of State would have to step in.
Lord Best: My Lords, I will certainly not press the matter further. However, it is important for the Government to know that the housing sector is very concerned that this regulation committee is independent and that the people on it feel able to say things that are contrary to what the Government might wish to hear. That independence is paramount. I hope that that point has been taken. I beg leave to withdraw the amendment.
59B In section 18(2) (co-operation with other regulators: definition of "relevant regulators") in paragraph (a) for "the Office for Tenants and Social Landlords" substitute "the Regulator of Social Housing".
59C In section 68(3) (determination of accounting requirements for registered social landlords: consultation with other bodies) in paragraph (c) for "the Office for Tenants and Social Landlords" substitute "the Regulator of Social Housing".
In section 170 of the Housing and Regeneration Act 2008 (overview) at the end insert-
"(2) For the purposes of this Chapter, "disposal of property" shall include the transfer of trusteeship of an almshouse by a registered provider where, as a result of that trusteeship, the registered provider manages land or dwellings; and "disposal of land" and "disposal of a dwelling" shall be interpreted so as to refer to the transfer of trusteeship which entails management of land or dwellings accordingly.""
Lord Shipley: Amendment 62 relates to the transfer of trusteeship of almshouses. I am grateful to my noble friend the Minister for writing to me in the Recess to say that she was sympathetic to the case for this amendment and would be happy to consider the matter and discuss it further even though there was a need to be cautious about extending the scope of state regulation in relation to charitable bodies. I hope that discussions can continue between today and Third Reading.
At present, if a regulated housing association sells occupied social housing, that housing association requires the consent of the regulator, who in turn requires the housing association to consult its tenants. By contrast, when the control of an almshouse is moved from one corporate trustee to another, the ownership of the property remains with the Official Custodian for Charities. For that reason the regulator's consent is not required for the change even if the residents' homes are in effect being sold against their express wishes. The amendment would ensure that if a registered provider wanted to transfer the trusteeship of occupied dwellings, the consent of the regulator would be required. The regulator could in turn require the housing association to consult residents.
I move this amendment because a housing trust-the Anchor Trust-is transferring the corporate trusteeship of 11 almshouses spread through London and south-east England to another charity. Many residents oppose this proposal and would prefer to be transferred to a more local charity instead. The issue here is about the rights of tenants. If this was a stock transfer, say, of local authority housing, tenants would have the right to be consulted and, indeed, to give their consent to a transfer of their properties. The question that lies at the heart of this is: if there has to be consultation and consent given for a stock transfer, why when almshouses are being transferred is there not to be full consultation and consent? The legal situation is complicated because of the charitable status of the almshouses. I understand that in this specific case there have been meetings between Members of Parliament and the chief executive of the Anchor Trust and with the Charity Commissioners. However, we need to address this issue in Parliament
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I recognise the need for further work to be done on the legal issues. I also recognise that we are still on Report. However, I hope that there is time to look further at those legal issues to see what might be done about this situation. In the mean time, I hope that it might be possible for full consultation and consent to be obtained from those tenants affected by this and any other proposed transfer of almshouses. I hope that it will be possible for that further work to be presented to your Lordships' House at Third Reading.
Lord Kennedy of Southwark: My Lords, I offer my support and that of the Opposition to the noble Lord, Lord Shipley, as I have done on a number of occasions on Report. He has identified a problem that needs to be addressed. It involves real people with real concerns. If the matter requires further work, as he says, and it can be done-I hope that the Minister will comment on that-the issue may be sorted out. Given that we are discussing a charity, I understand that the issue may be more difficult than it at first seems, but I hope that the government Front Bench will give a positive response.
Amendments 65 and 67 in this group stand in my name. Amendment 65 would ensure that a parent company of a group of housing associations can be registered even if it owns no housing itself. This would allow the regulator to regulate group members via the parent rather than directly if he thinks that that would be more effective. Amendment 67 concerns the appointment of members to housing association boards. The law as it stands allows the regulator to make unlimited appointments to a registered provider's governing body provided that they remain a minority. For a 10-member board, it would allow the regulator to make nine appointments. My amendment limits the number of appointments the regulator may make to no more than four. This is a proportionate number of appointments and would enable the regulator to strengthen the board by adding members with sufficient skills and abilities to deal with any concerns that they may have about the board's performance. However, the number would not be too overbearing as this sort of appointment would be of a temporary nature to help the housing association board discharge its duties more effectively.
Lord Best: Amendment 67 stands in my name and that of the noble Lord, Lord Kennedy. It concerns the appointments made by the regulator. It is important to note that this amendment relates only to appointments made by the regulator where the housing association has not failed in any way. It is not a disciplinary measure but constitutes a voluntary helping hand for the organisation. In a number of cases that I know well additional members have been appointed by the regulator as new members of the board and have been very helpful. However, there are limits to the number of appointments that the regulator ought to make to the board. We suggest that these be limited in future to a maximum of four. In my experience three new people are usually appointed to strengthen a board
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Earl Attlee: My Lords, as regards the amendment moved by my noble friend Lord Shipley, I recognise the strength of local feeling in the case that he highlighted. We have looked at his proposal extremely carefully and have discussed it with the social housing regulator, the Charity Commission, the National Almshouse Association and the National Housing Federation. We have also received helpful representations from the United St Saviour's Charity and from residents of the Hopton's Almshouses in Southwark.
I fully understand the reasoning behind the proposed amendment. However, we are concerned that the amendment seems to require an increase in bureaucracy and potential state interference in the proper exercise of charity trustees' discretion. Currently, the identification of a new trustee is a matter for the existing trustee to decide and we are not convinced that new regulatory controls should be applied. The proposed amendment would apply only where the corporate trustee of an almshouse happens to be a registered provider of social housing. It is not clear that there is a strong rationale for requiring that these almshouse trustees, but not others, seek consent.
Registered providers are subject to a regulatory requirement to consult tenants on changes to management arrangements, and the Charity Commission's consent is required for changes to charities' objects. My noble friend tempted to me to say something about Third Reading, but I am not convinced that there is anything more that we can do with this Bill, so I shall resist that temptation. However, I suspect that this will be a live issue for some time to come. Our expectation is that, as a matter of good practice, housing associations should and would consult any residents affected by significant management changes that they are proposing to make.
Amendment 65 was tabled by the noble Lord, Lord Kennedy of Southwark. A transitional provision is already in place that allows non-stock-owning group parents to remain on the regulator's register, despite the fact that they are not social housing landlords as defined by the Housing and Regeneration Act 2008. In order to minimise uncertainty, I am happy to confirm that the Government have no plans to withdraw this provision. However I am not convinced that the regulator should be able to register new bodies that do not meet the landlord test provided by the 2008 Act. It is not clear that there is anything fundamentally wrong with the principle that regulation should apply to the landlord of the stock. This approach is consistent with wider legislation, which usually imposes legal obligations on landlords rather than on any parent companies they may have.
Amendment 67 was tabled by the noble Lords, Lord Best and Lord Kennedy of Southwark. The existing legislation provides that the regulator may not normally appoint more than a minority of the officers of a registered provider. I am not convinced that removing this restriction and replacing it with a prohibition
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I am also concerned that this change could reduce the effectiveness of the regulator's response to a serious problem in an association. For example, where an association has no officers, as has occurred in the past, but its constitution does not specify a minimum number of officers, the amendment would permit the regulator to make up to four appointments only. That may not be sufficient to put things right and protect tenants and the taxpayer.
Lord Kennedy of Southwark: I know that the Minister was not tempted by the noble Lord, Lord Shipley, but can he give the House any assurance that the issue the noble Lord raised will be looked at seriously by the Government? I accept that this involves charity law, which is complicated stuff, but it also involves real people with real concerns and the Government should look at this seriously.
Lord Shipley:Will it be possible for the evidence that the Minister referred to from the regulator, the Charity Commission and other bodies to be provided in the Library so that we can see exactly what evidence they have supplied to the Government that indicates that legally this is very complicated? Would the Minister agree that it would be good practice for consent to be received where a transfer is being proposed for almshouses? Would he consider and give advice on what other steps could be taken to ensure that consent for transfer from tenants is delivered?
Lord Kennedy of Southwark:Before the Minister sits down, I shall press him on this point. In order to get time for this to be resolved, would he be able to facilitate a discussion between representatives of these organisations, the almshouses and their residents with officials and Ministers in the department?
Earl Attlee: My Lords, we will do whatever we can to assist a resolution of this problem. We will continue to monitor it, but my particular point is that there is not much more we can do with this Bill.
Lord Shipley: My Lords, when I moved Amendment 62, I quoted from the Minister's letter which said that she was sympathetic to this case, so I am pleased that we seem to have ended on a note of sympathy and
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Lord Shipley: I understand the point that the Minister is making-that this Bill may not be the right forum for progressing the issue-but there will nevertheless be discussions about how the issue might be progressed in other ways.
"(7) The Secretary of State may by order amend this section for the purpose of-
(a) adding to the permitted classes, or
(b) modifying or removing a permitted class added by order under this subsection.
(8) Before making an order under subsection (7), the Secretary of State must consult-
(a) the Charity Commission,
(b) the regulator, and
(c) one or more bodies appearing to the Secretary of State to represent the interests of registered providers.""
Earl Attlee: My Lords, in Committee, the noble Lords, Lord Best, Lord Patel, Lord McKenzie and Lord Beecham, tabled an amendment designed to liberalise Section 122 of the Housing and Regeneration Act 2008, which restricts the payments that housing associations may make to their members, and a similar amendment has been tabled again by the noble Lord, Lord Best.
The Government agree with the aim of the amendment and have put down our own amendments to achieve it. The amendments we have tabled would give the Secretary of State the power, by affirmative order, to add to the classes of permitted payments that housing associations
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Lord Best: I am very grateful to the Minister for what he has just said. There has been a problem here, but it sounds as though it is well on the way to resolution. I am very happy not to move Amendment 64.
Lord McKenzie of Luton: We are grateful to the Government for responding to the earlier amendment. I acknowledge that the noble Lord, Lord Best, will not move his amendment, but are classes 4 and 5 specified in that amendment classes that the Government would support and take forward under the process that they have set down?
(a) in subsection (3)(a) (orders subject to approval in draft by each House of Parliament), after "114" insert ", 122", and
(b) in subsection (7)(a) (orders subject to annulment by either House of Parliament, and exceptions from that requirement), after "114" insert ", 122"."
"(3A) If a designated person who is asked to refer a complaint to a housing ombudsman declines to refer that complaint, the individual making the complaint may make it directly in writing to that housing ombudsman."
Lord Greaves: My Lords, we discussed this issue at some length when debating a previous group of amendments. The Minister gave a clear assurance that we can have discussions before Third Reading. I hope that we can come to some consensus. On that basis, there is nothing more that I need to say.
Baroness Hanham: My Lords, I am in an interesting position. I offered discussions when debating the last group of amendments, but the offer was rejected forcibly by the vote. I have now been asked whether I will have discussions on these amendments, and I am happy to say that I am content to have them.
Lord Greaves: I think that that was an acceptable answer. I understand that we cannot bring back the amendment that was defeated in the vote, but there are plenty of things in these amendments that we can talk about in relation to what the Bill states. That gives us sufficient leeway to talk about what we want to talk about. Whether the Government will extend their offer of discussions to the Opposition, who rudely threw it back in their face on the previous group of amendments, I do not know. I would welcome their participation, but that is up to the Government.
Lord McKenzie of Luton: Perhaps I may make it clear that we voted on the original proposition because we believed that it would secure the best outcome. As that did not succeed, it is not inconsistent to want to see a lesser position that nevertheless improves on what is in the Bill. That is entirely sensible and reasonable. Whether we will be involved in those discussions is up to the Government. If they are going to bring something back-and I believe that that is the wish of the noble Lord, Lord Greaves-we will have an opportunity in this Chamber to join in the debate.
Lord Newton of Braintree: Before the noble Lord withdraws the amendment, as I presume he will, I will express the hope that the House will go along with this. We got into a mess earlier over the vote because of the separation of these issues, which could have been linked. We now have an opportunity to take up the Minister's offer of discussion. I think that we should, and I hope that neither she nor we will dig in out of purism, and that the Clerks will have their ears open.
Baroness Hanham: I will try to dig us out of this muddle. I am happy to have discussions and to include the Opposition. The discussions might be overshadowed slightly by the way in which we proceed on these amendments. However, it is perfectly proper that we should have them and include everybody.
Lord Palmer of Childs Hill: My Lords, this amendment also has the fatal "o" word-ombudsman-in it, but noble Lords need not be afeared because it is a very non-contentious issue to which the noble Baroness, Lady Hanham, has kindly replied, and I agree with her answer. I tabled the amendment about the ombudsman because, when reading the Bill, one notes that the Housing Ombudsman will make a determination, but no mention is made of any compensation element. Determination is all very well, but an applicant may want monetary payment or grovelling of some sort and that is not mentioned in the Bill.
When investigating this in advance of the helpful reply of the noble Baroness, Lady Hanham, I went back to Schedule 2 to the Housing Act 1996, which says, as the Minister implied, that the Housing Ombudsman may,
It is already in law that compensation of a monetary sum can be paid. I will make what is almost a drafting point. The laws of this country are so entwined and confused that it is wrong that one has to keep referring back to previous Bills to understand the Bill that one is looking at. We are not talking only of lawyers who will go back and say: "Ah, that is in the Housing Act 1996". In this Bill one does not see any element of monetary repayment as compensation. I seek acknowledgement that, in whatever paper forms are produced, there will be a cross-reference to the 1996 Act so that people can see that there is a determination. I would be very happy if the Minister would confirm something on those lines. I beg to move.
Lord Beecham: My Lords, I will follow the noble Lord, Lord Palmer, on the question of compensation. Clearly, the ombudsman route provides the possibility of compensation. It is not certain whether that would apply to the alternative route, which we debated at some length earlier. Perhaps the noble Earl could indicate whether under the alternative method of the designated person-a councillor, Member of Parliament or tenant panel-there will be the opportunity for a compensation payment to be made by the designated person. If not, we would have two systems, one of which would afford the possibility of compensation while the other would not. I am sure that the noble
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Earl Attlee: My Lords, Amendment 74 highlights the Housing Ombudsman's power to order a member landlord to pay compensation to a complainant. I understand that my noble friend would like there to be greater clarity on how the ombudsman calculates the level of compensation to be awarded and I am grateful to him for raising the issue. Our view is that it is not necessary to include any new specific requirements in the Bill. In practice the ombudsman already provides a breakdown of any compensation he has decided to award, which is done in the context of what the ombudsman considers to be fair and reasonable in all the circumstances of the case. This arrangement allows flexibility to address specific issues and to provide a useful level of information, depending on the circumstances of each case. Clearly it would be difficult to attain this flexibility in a legislative duty on the ombudsman.
The ombudsman is intending to consult early next year on a revised statutory scheme to reflect the proposed extension of his jurisdiction to include complaints about local authority landlords, in addition to housing associations. I have no doubt that there will be further opportunities through that consultation process to engage on these and other issues. In answer to the question asked by the noble Lord, Lord Beecham, anything referred to the ombudsman means that compensation can be paid.
Lord Beecham: My question is in relation to the other routes that have been included in the Bill and which may be taken further in discussions before Third Reading. Would compensation be payable when the matter is dealt with by a local councillor, Member of Parliament or a tenants panel? If not, would that be made clear to the applicant, whereas the ombudsman would provide the possibility of compensation?
Lord Palmer of Childs Hill: My Lords, I thank the noble Earl for his reply and the noble Lord, Lord Beecham, for his comments. I am quite confident that the monetary compensation would apply to all reports to the ombudsman, in answer to the comments of the noble Lord, Lord Beecham, so I have no worries on that score. My only comment is that for the sake of clarity in the ongoing negotiations and discussions, it would be useful for non-QCs to see that there is monetary compensation without having to go back to the 1996 Act. I very much thank the Minister for his reply and the reply from the noble Baroness, Lady Hanham. I beg leave to withdraw the amendment.
Lord Best: This amendment is about the new powers for the ombudsman to apply to a court to make its rulings legally enforceable-in other words, to insist, having made a judgment through the courts, that the landlord complies with the ombudsman's decision. This is quite a big jump from the current scheme, which is based on informality. At the moment it is an inexpensive scheme. It is very accessible to complainants and people do not come with their lawyers. It is not part of the legal processes. It is feared that the new scheme will rather change the nature of the way in which the ombudsman works. It also carries the same risk that I have been harping on about today, that housing associations will slide into the public sector and become indistinguishable from public sector agencies, which has the effect thereafter that all of their borrowing will become part of the public sector debt, which I know the Government are very anxious to avoid. There is a risk that if housing associations are subject to legally enforceable decisions based on the opinion of a public authority-the ombudsman-they may not be regarded as being outside the public sector. That would be a calamity.
Once again, this is about trying to retain the independence and non-statutory nature of the sector. The removal of these new legal powers would be helpful in sustaining that independence and the success of the ombudsman's scheme to date, without making the ombudsman's rulings legally enforceable.
Lord Kennedy of Southwark: My Lords, I shall speak briefly to Amendments 75 and 76. They would ensure that the ombudsman's service is not damaged by unintended consequences. What is wonderful about the ombudsman's service is that compared with the courts, proceedings are informal, inexpensive and accessible. It is respected as its rulings are complied with by registered providers. The Government are proposing to solve a problem that noble Lords on this side of the House do not believe exists. We should be careful not to undermine the service. Will the Minister tell the House where the proposal has come from? Who has asked for it? How has it arrived here?
Earl Attlee: My Lords, the proposals relate to the proposed order-making power for the Secretary of State to enable the housing ombudsman to apply to a court or tribunal to enforce his determinations. One of our aims through our package of reforms to social housing regulation is to give a greater role to social housing tenants in the scrutiny of landlord performance. The Bill supports that by providing a clear role for tenant panels in the complaints process. In parallel, we are currently consulting on draft directions to the social housing regulator that will result in tenants having stronger tools with which to scrutinise landlords' performance. The regulator's consumer regulation role
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The noble Lords, Lord Best and Lord Kennedy, give an accurate description of the current situation. There is not a problem. The Government would use this power only if levels of compliance with the housing ombudsman determinations declined significantly. At present compliance is high, as noble Lords have recognised. Only one recommendation has been rejected in the past seven years. We hope and expect that this will continue. If so, we have no intention of using this power.
Earl Attlee: My Lords, it is wise to make sure that we have the order-making power should we need it. It concentrates the mind. As I said, we have no intention of using it unless the situation deteriorates. I suspect that it will not, but it is always advisable to have something in your back pocket.
Lord Beecham: I remind the Minister of the thrust of the question of the noble Lord, Lord Best-the risk that because an order is enforceable, the RSL sector is regarded as being within the public sector, with consequential adverse effects on the financial status of its expenditure in relation to the Government's expenditure requirement.
Earl Attlee: My Lords, I am confident that my department has properly considered those matters. It is obviously a very important issue and I have already undertaken to write to the noble Lord, Lord Best. Other noble Lords will of course get a copy, and there will be a copy in the Library.
(1) The overcrowding standard is contravened when the number of rooms in a dwelling which are available as sleeping accommodation is smaller than the number specified in subsection (3), having regard to the number and description of persons who are ordinarily resident in the dwelling.
(2) For the purpose of calculating the number of rooms available as sleeping accommodation, no account shall be taken of a room which is of a type normally used in the locality as a living room or of a kitchen.
|Description of persons||Number of rooms|
(a) no account shall be taken of a room having a floor area of less than 50 square feet;
(b) a room measuring 50 square feet or more but less than 70 square feet shall not be taken to be available for anyone other than one child under 10;
(c) a room measuring more than 70 square feet but less than 90 square feet shall not be taken to be available for anyone other than one person of any age or two children under 10;
(d) a room measuring more than 90 square feet but less than 110 square feet shall not be taken to be available for anyone other than one person of any age or two persons of whom at least one must be a child under 10; and
(e) a room measuring 110 square feet shall be taken to be available for two persons of any age.
(5) The Secretary of State may by regulations prescribe the manner in which the floor area of a room is to be ascertained for the purposes of this section; and the regulations may provide for the exclusion from computation of floor space in a part of the room which is less than a specified height not exceeding eight feet.
(1) Where a dwelling is found to contravene the overcrowding standard, the local housing authority may serve on the owner or manager of the dwelling notice in writing requiring him to take reasonable steps to abate the overcrowding within 28 days from the date of service of the notice.
(2) For the purposes of subsection (1), a person shall be considered to have taken reasonable steps to abate the overcrowding if he takes such steps as are necessary in law to recover possession
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(3) If, within the period of 28 days following service of an abatement notice under subsection (1), or within such further period as the local housing authority shall in its discretion allow, the owner or manager has not taken reasonable steps to abate the overcrowding, the authority may apply for an order to the county court.
(4) On an application by the local housing authority under subsection (3), the court may order that vacant possession of the dwelling or part of the dwelling be given to the landlord within such period as the court may determine.
(6) In exercising its powers under subsection (4), the court shall have regard to the interests of any tenant or occupier of the premises, and in particular to the security of tenure of any protected or statutory tenant under the Rent Act 1977 or any assured tenant under the Housing Act 1988.
This amendment seeks to deal with the nature and extent of overcrowding and to highlight why the present law is inadequate and needs reform. Overcrowding is an invisible problem compared with homelessness and rough sleeping. Consequently, it tends to be viewed as less of a priority. But overcrowding has a serious impact on children, especially their health and educational attainment, and it disproportionately affects larger households.
Overcrowding is a major problem in London. In 2008 London had more than 200,000 overcrowded households, almost 7 per cent of London's homes. That was an increase of one-third over the previous decade. About half of these overcrowded households are in the social rented sector; overcrowding is worse in that sector than in any other form of tenure. London has over 40 per cent of England's overcrowded households in the social rented sector, and nearly 400,000 London children live in overcrowded conditions. The overcrowding rate for black and minority ethnic households in London is about four times that for white British households.
There is no doubt that overcrowding is largely a consequence of housing supply shortage. Therefore this amendment is not a complete solution to overcrowding. For that, we need to build many more homes and, in particular, larger family homes. But this amendment is intended to deal with the abuse of the existing housing stock.
Breaching legal overcrowding standards is a criminal offence, but the official definition of overcrowding has survived unchanged since 1935 and is seriously outdated. Relatively few households are legally overcrowded even though some people have to sleep in living rooms and kitchens. There is little incentive for local authorities to tackle the problem if the law is not actually being
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Overcrowding is a very serious issue. So if the Government are not minded to accept this amendment, perhaps my noble friend the Minister could outline what the Government propose to do to update the official definition of overcrowding, which has not changed for the last 75 years.
Lord Beecham: My Lords, even in your Lordships' House there are not many of us who were around when these standards were laid down in 1935, as the noble Baroness has pointed out. Housing conditions in general have improved since those days, but she is quite right to draw attention to serious issues around overcrowding. They are not confined to London, although her figures show these issues are extremely problematic in the capital. She is also right to draw attention to the particular problems faced by some BME communities, many of whom have large families and find it difficult to secure accommodation which is adequate to house them.
I have every sympathy with the amendment. I note that the measurements are given in "old money", when perhaps these days we should be looking at metric equivalents, but that is a trivial point. I am however somewhat at a loss as to how to respond to the Government's response to the amendment. It seems to be based, to put it crudely, upon facile optimism about the effects of the measures that are being taken around the duties to deal with homelessness and, in particular, the use of flexible tenancies as a means by which, apparently by magic, accommodation of the appropriate size in the appropriate location will become available. The Minister for Housing assured us at a meeting a couple of days ago that he does not expect flexible tenancies to go much less than 10 years in duration, as opposed to the two years that was thought to be the benchmark. In his view-I hope he is correct-that will in fact constitute only a handful of cases. Given that, I cannot see how this measure is going to free up significant accommodation in general, let alone for this particular category.
It seems to us in the Opposition that the noble Baroness has touched on a key issue and the Government's response thus far has not addressed it to any significant extent. Identifying the issue and improving the standards by which the question of overcrowding is to be judged does not in itself transform the situation, of course, but it would certainly allow housing authorities and the Government to have a better view of the reality of the situation.
I hope that the noble Baroness will not mind me quoting the example she gave in a conversation with me, of a recent case of a child sleeping in a bath which was deemed by the housing department to be acceptable because the child was in "a room". It is extraordinary for this situation to be acceptable to a housing department
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Strengthening the framework will allow a proper measurement to be taken of the degree to which this is an issue that needs to be addressed, and with a greater urgency than is likely to occur simply as a result of the other changes that the Government have made. I hope that the Minister will talk further with the noble Baroness to see how this can be improved and, beyond that, agree that this is an issue that should be pursued outside the context of this Bill as the Government look into housing policy generally.
Baroness Gardner of Parkes: My Lords, I am sympathetic to the idea of the need for action on this. I was very distressed this week to meet someone in a studio flat, or self-contained bedsit, who told me it is impossible for her to sleep. The private accommodation units where she resides are listed as being for one person, but immediately above her, accommodation of the same size is shared by five people. She finds it impossible to sleep, or even live there. She is trying to find somewhere to move to in any case, as her small accommodation is going up from £600 per month to £800 per month, but she works as a cleaner and is experiencing great difficulty.
What worries me is that this is an illegal overcrowding, from what the noble Baroness has said, and yet the tenants are frightened to do anything about it for fear of being put out. I asked her why she did not report it and she said she did not dare because she would be put out and would have nowhere, and until she could find somewhere to go to she could do nothing. This is what worries me about this amendment. It is marvellous to make all these proposals but where is the accommodation going to come from to house all these people?
I come from a very big family and we were fortunate enough to have a house, and space is not so limited in Australia, but if you have a big family would you not rather be somewhere safe and secure, even overcrowded, than nowhere at all? I am very concerned about the impact of being too precise about things. As I say, in theory it is absolutely marvellous but I would really like to know how it is going to work in practice.
Lord Taylor of Holbeach: My Lords, I thank my noble friend Lady Doocey for bringing these amendments and indeed the noble Lord, Lord Beecham, and my noble friend Lady Gardner of Parkes for their contributions to this debate. It is an important issue and the Government view overcrowding as a matter of serious concern. My noble friend Lady Doocey mentions the impact it has on the lives of people, children in particular, and we have heard the evidence of my noble friend Lady Gardner.
Overcrowding adds to the stress of people, it damages health, it costs the community happiness and well-being, and interferes with children's upbringing and education. Despite the previous Government investing, quite rightly, thousands of pounds of taxpayers' money in helping councils tackle overcrowding, the number of families
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I have to assure my noble friend Lord Beecham that the Government are convinced that the reforms we are making to social housing through this Bill will assist this process. Perhaps I can elaborate on them. By taking existing tenants who are not in need out of the allocation rules, councils will be able to help under-occupiers to find a more suitable property, freeing up more family-sized housing for overcrowded households. I am sure that is something that we would all wish to see. By strengthening mutual exchange through the introduction of a national home-swap scheme, it will be easier for under-occupying and overcrowded households to help each other. By enabling councils to make greater use of the private sector to support homeless households, they will have more scope to use social housing to help others in housing need, and by retaining the reasonable preference provisions in allocation legislation, we will ensure that overcrowded families continue to get priority for social housing.
Over the longer term, new flexible tenancies will help councils provide housing that meets households' needs at the time they need it, but also just for as long as they need it. I am sure that this is the right way forward. We will be looking at the new statutory allocation guidance for local authorities and this will provide an opportunity to encourage all councils to adopt a more modern standard for assessing overcrowding when prioritising social housing. The Government believe that this would be a better way to ensure that families who live in cramped conditions get proper priority for appropriate social housing, rather than changing the statutory standard definition, because it would address the issue of social housing directly. That is the right way to reduce overcrowding and that is why I hope that my noble friends will withdraw their amendment.
Baroness Doocey: My Lords, I am quite disappointed with the Minister's response. I find it astonishing that the Minister is arguing that a law that was put in place 75 years ago that allows people to sleep in kitchens and living rooms and still not legally be classed as overcrowded does not need reform. I find that very, very difficult to understand. I take note of the various things he has said about how the new system will work. I am perhaps not as convinced as he is that it will free up all of the accommodation, and one reason is that until councils have a legal duty to do something about families in overcrowded conditions, I cannot see that they are going to treat this as a priority. Would the Minister be willing to meet me to discuss this in a bit more detail? If that were the case I would be happy to withdraw the amendment at this stage.
Lord Taylor of Holbeach: Yes, I think we have made it quite clear that in our view this Bill is not the place to be putting this particular amendment. I have given an indication that new advice and guidelines are perhaps forthcoming. If my noble friend would find it useful to talk to officials about this matter before those guidelines are issued, I hope that she would be happy to participate in that discussion.
78: Clause 171, page 159, line 27, leave out from "words" to "and" in line 31 and insert "for "if on such an application" substitute "in the case of an application under subsection (1) if the tenancy has not ended and","
Earl Attlee: My Lords, I beg to move Amendment 78 and speak to Amendments 79, 80 and 243. These amendments are four minor and technical amendments to the new clause that we introduced in Committee. These combine to remove a lacuna in the clause as currently drafted. They would mean that Section 214(3A), which enables the court to order that the deposit be repaid in part or in full to the tenant, would apply if the tenancy had ended at the date of the application to the court but not if it had ended after that date. Clearly this is not the intention of the legislation and I ask noble Lords to support this amendment. I beg to move.
"(2A) Subsections (3A) and (4) apply in the case of an application under subsection (1) if the tenancy has ended (whether before or after the making of the application) and the court-
(a) is satisfied that section 213(3) or (6) has not been complied with in relation to the deposit, or
(b) is not satisfied that the deposit is being held in accordance with an authorised scheme,
as the case may be.""
The preserved right to buy under section 171A of the Housing Act 1985 (cases in which right to buy is preserved) shall not be available in respect of a dwelling-house let by a registered provider of social housing in a rural area designated for the purposes of section 17(1)(b) of the Housing Act 1996 (right of tenant to acquire dwelling: supplementary provisions)."
Lord Best: My Lords, Amendment 81 is about the exclusion of some rural dwellings from the preserved right to buy. Quite a few tenants who were previously in the public sector have become tenants of a housing association, through large-scale voluntary transfers. Those tenants, and indeed others in social housing, have the preserved right to buy: the opportunity, if they move around, to buy the place to which they move if it is another social housing home. However, if they wish to move into a home that falls under a Section 106 planning agreement, which provides that the property must be retained in perpetuity as a rented social housing home-that is; it is a condition of planning that a certain number of homes are for renting-they will be unable to do so because the landlord would be in breach of the Section 106 agreement. The preserved right to buy is rather paradoxically preventing people moving out of the council house that they are in at the time and into a new property that has been built under a Section 106 agreement.
This amendment excludes certain rural dwellings from the preserved right to buy, allowing the people to move in and not then be able to exercise the right to buy that property because of the Section 106 agreement and the restrictions on that property. This amendment would be helpful to people moving around-to tenants. It is unfair at the moment that they have to be turned away, even though the case is good, because the properties are restricted and cannot be sold into home ownership on a permanent basis.
During the summer, I received a lot of helpful correspondence from Ministers and the civil servants have been very helpful. On this matter, I had a reply which I think indicated that the point had not been fully understood by the civil servants. They have been marvellous in every other respect, but with this one aberration I did not get a satisfactory response. I am not entirely sure that the point was fully understood, which must have been my fault when making it in the first place. If this small, unintended consequence of legislation could be cleared up in the Bill, it would be helpful to the mobility of people in rural areas and in places where there are restrictions in the properties that have been built, thus helping mobility. I beg to move.
Lord Kennedy of Southwark: The noble Earl was a bit too quick for me. The Opposition gives its full support to the noble Lord, Lord Best, in moving his amendment on the exclusion of certain rural dwellings
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The amendment fixes an unintended consequence and the tenants would then have the right to acquire, which does not apply in rural areas. Therefore, the problem would not happen and the tenants in those situations can seek to move to social housing in rural areas if they wish. I hope that the noble Earl, Lord Attlee, can see that we are trying to be constructive and sort out a problem for everyone's benefit.
Earl Attlee: My Lords, the noble Lord, Lord Best, in moving his amendment suggested that his point was not fully understood. He alarmed me somewhat because he talked about Section 106 and its consequences. Unfortunately, my notes do not refer to Section 106 and nor do the Q and As. If my response does not fully answer his question, I will of course write to him with further details.
Tenants who have been involved in a stock transfer from a local authority to a registered provider would have agreed to this transfer on the basis that they would retain their right to buy. We do not think that it would be proper to remove this right from the tenant. Equally, we do not think that it is right that secure tenants who are part of a future stock transfer should have their longstanding right to buy taken away simply because they live in rural areas and their homes have been transferred to a new landlord.
However, while we wish to ensure that transferred tenants are not denied their existing rights, there is statutory provision to ensure that the new tenants of these properties do not get the right to purchase their homes in order that the properties remain available to those in need of social housing. There are existing measures in place to ensure that homes in rural areas, which are sold under the preserved right to buy, remain available to people at affordable prices.
Landlords can already impose restrictions requiring owners who wish to sell to either resell only to people who have lived or worked locally for at least three years, or first offer their home to the landlord, giving them the opportunity to return the property to their existing housing stock if they wish to do so. These restrictions on reselling are already in place in a very significant proportion of our countryside and remain in place in perpetuity. In our view, this is sufficient.
To move that this House regrets that it is not clear from the Impact Assessment or Explanatory Memorandum of the Statement of Changes in Immigration Rules (HC 1148) how the findings from the consultation have fed into the development of the policy or the estimates of the costs and benefits of the changes.
Lord Hunt of Kings Heath: My Lords, this statement of changes in Immigration Rules makes a number of changes to those rules and sets out the second set of changes to the rules governing the student immigration system in tier 4 of the points-based system. The tier 4 changes include restricting permission to work during studies for students applying for entry clearance or leave to remain and a restriction in the entitlement to bring dependents, partners and children into the UK.
The statement has been brought to the special attention of the House by the Merits Select Committee in relation to the tier 4 rules. I wish to express my great thanks to that committee for its work in relation to this statement. The House may recall that the Government earlier published a statement of intent, setting out the full planned changes for the student immigration system. However, that statement was laid without the impact assessment for the changes and the committee identified significant gaps in the analysis of the consultation responses. The Government have now laid the impact assessment for the reform of tier 4 of the points-based system.
The impact assessment says that the Government intend to reduce abuse through the immigration system and to reduce net immigration significantly. The impact assessment sets out the policy objectives as being to,
The Opposition have consistently set out their concerns about the impact of this policy. The UK has a worldwide reputation for providing quality education to overseas students. My understanding is that we are the second most popular student destination in the world after the US. Overall, the international student market is estimated to be worth £40 billion to the UK economy. There is very real concern about the impact of the Government's actions on this very important economic
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Apart from the matter of principle and the potential damage to the UK economy of the Government's approach, there is considerable uncertainty about the likely impact. In March 2011, the estimated impact on student numbers suggested a reduction in student visas of between 70,000 and 80,000, and yet the impact assessment suggests a reduction of 232,000 over five years from 2011 to 2015 against a total estimated baseline of 558,000. Quite understandably, I suggest, the impact assessment states:
I hope that the noble Earl will be able to acknowledge that and give some reassurance that this will not happen again, given my own expectation that the Government will produce a number of further changes to the Immigration Rules in the future.
"In terms of direct costs and benefits, the IA estimates that over the four year appraisal period UKBA will receive around £160 million less in fee income ... This is a significant reduction in fee income at a time of budget cuts for UKBA. Although the IA also says that there will be a saving of around £150 million in processing costs, it is not clear whether this is actually a cashable benefit ... The IA also estimates that over the four year period, tuition fee income will fall by approximately £170 million ... However, this is based on the assumption that for every ten non-EU migrants no longer able to study at all affected institutions, eight of their places would be filled by either EU of British nationals".
This is not the first time that we have had to debate the Government's reluctance to spell out the consultation and the way it has influenced the Government's decisions. The committee gives an example of this when it states that,
A cynic might say that the Government did not like the result of the consultation, and that is why they have not been very open about it. I am not cynical, but I would like the noble Earl to respond to that point.
Of course, overriding the questions raised by the Merits Select Committee is a deep concern shared by many noble Lords about the general policy. This country has enjoyed a fantastic reputation for the quality of its education. Thousands upon thousands of young people in particular, but not just young people, have come to our shores. Most have gone back home, but they have retained links with this country and their educational establishments. The reputation of this country has been strongly enhanced, together with a huge amount of inward investment. I still fail to understand why the Government do not recognise the potential damage they are doing to these establishments and to the economic benefit of this country. The fact is that when it comes to bogus students and bogus colleges, the previous Government had already taken decisive action in that regard. The suspicion remains that the Home Office, desperate to meet the quota it set, charged ahead on this because it thought it would be easy to do, coupled with the weakness of the business department to defend effectively the interests of educational institutions. That is why we have this policy which, in my view, is a disastrous one.
So here we are, with the outcome of a flawed policy, poorly executed, with inadequate information for Parliament which will do considerable damage to our economy and our educational institutions. I would remind the noble Earl of the publication yesterday of the top 100 universities. A remarkable number of UK universities are in the top 10 and in the top 100-including, I am glad to say, my own Birmingham University. Why are the Government putting that at risk? We demand those answers, and I hope that the noble Earl will be able to respond today.
Baroness Hamwee: My Lords, I welcome this debate and I am glad that the noble Lord was able to table his Motion. I should say that I am a member of the Merits Committee. It seems to me that the sort of points that have been made in this report are just the sort of thing that the committee is there for. I welcome the debate, although I do not welcome the fact that it is necessary. With regard to the issue of the production of the impact assessment-I will come on to the substantive issue because I cannot resist it-it is not the first time that I will have talked about the importance of scrutiny. It is important both to those who are the proponents of a proposition and to the opponents. The first bunch wants to get it right and the second bunch wants to pick holes in it; there is a unity of purpose there. Making the point, as the Merits Committee has done and as the House is now asked to do, is worth while only if the culture changes and this sort of error or omission-call it what you like-is not repeated. This is the sort of point that the Merits Committee has often had to make by way of a warning shot. The sanction from the committee is to bring the matter to the House.
I recall reading the agenda item and, in order not to make the Hansard writers blush, I will not use the language that I used then when I saw the figures, which are startling. The noble Lord referred to many of them: the 232,000 estimated reduction against the 70,000 to 80,000 estimate given only six or seven months ago, and a net cost of more than £2.4 billion with the UK Border Agency estimated to receive about £160 million less in fee income on the basis of the option chosen against the "do nothing" option.
That takes me to my next point. The committee does not make this point but I will. The options given are not a range but simply the polarised options of "do nothing" or "do this one other thing which we, the Government, are proposing". So there is a steer to what one might describe as the right answer. So although this was a consultation, it is more akin to some sort of choice. It is not easy or indeed even possible for Parliament to assess what it is being asked to agree in this way. The Merits Committee report was very measured, and I quote from Paragraph 10:
"The Committee recognises the difficulty in developing the estimations of the likely costs and benefits of the changes, particularly given some of the gaps in the data and the potentially complex range of impacts. However, it is not clear from the IA how the findings from the consultation have fed into these estimations".
That is just the sort of thing that should be made publicly available. That is the purpose of the consultation. The background questions which consultees were asked would also have been useful in informing the debate. They were asked:
In the end, of course, what matters is the policy. Many noble Lords across a number of debates, including many of my noble friends, have made very clear our real concerns with some of the policy objectives. Even if we support a reduction in net migration, we do not believe in clamping down on student visas. We do not believe that is in the long-term reputational interests of the UK, nor its social, political and wider economic interests. I am not convinced it is even coherent within its own terms. I have commented before on the term "the brightest and the best". That begs an awful lot of questions. We cannot assess the success-a term I use deliberately-without knowing how many students leave at the end of their course, which we-I do not just mean Parliament-are not adequately equipped to do. There is an increase of one when an individual arrives in the country and when he leaves there is a decrease of one.
The Immigration Law Practitioners' Association, which is immensely helpful to your Lordships in the detailed, analytical and very sensible briefings it provides, has drawn more concerns to our attention. It makes the point:
"The effects of lack of proper evidence, for the consultation or for the impact assessment, go beyond an unsound evidence base. They go to the question of fair and equal treatment of persons on the basis of their nationality".
It draws your Lordships' attention to students from designated so-called "low-risk" nationalities where the UK Border Agency bases decisions on national origins. The countries I call "respectable" in this context are Canada, Australia, Hong Kong and New Zealand. So an immigration history of an individual may be lengthy and exemplary but the way in which that individual is treated by the UK Border Agency does not depend on this but on his national origins. The ILPA cites examples of the UK Border Agency "not being over-zealous" in attempting to verify documents, not pursuing responses or assuming a negative response if a phone call is not returned within a couple of days, and refusing to pay a de minimis fee of a couple of quid in order to get copies of necessary documents. It does not make me feel proud of the way we deal with people who want to come into this country and show a confidence in it and a loyalty to it.
The ILPA also draws your Lordships' attention to the slightly wider problems which arise from the changes we are asked to consider about the rights of adult refugees to be reunited with their children who are minors. I am concerned about what I read on that. Finally, it cites the example of the Academic Technology Approval Scheme. This is almost laughable except that it is really very serious. The scheme requires a certificate to be obtained where studies are said to,
The sector was very vocal in its concerns about the financial impact of the changes and wider arguments than those referred to in the impact assessment were shared with your Lordships. I recall my noble friend Lady Benjamin, who is Chancellor of Exeter University, talking about the value that students bring to the local area, and bluntly, I agree with the noble Lord, Lord Hunt. The sector is such a good earner, such a good revenue generator well beyond its immediate operation, that restricting access as a proposition frankly defeats me.
Lord Avebury: My Lords, I join my noble friend in welcoming the Motion that has been tabled by the noble Lord, Lord, Hunt, and I find myself in substantial and almost entire agreement with every single word that he spoke in support of it. I congratulate my noble friend Lady Hamwee on the sterling work that she does on the Merits Committee which has resulted in bringing this matter before the House, and not for the first time. I remind your Lordships that this is the second occasion in a row when the Merits Committee has commented on a statement of changes in the Immigration Rules. That indicates to me that all is not well in the direction of the UKBA. I often thought that the separate management of the UKBA was a mistake. At a time when the Government are looking for economies, they could perhaps do worse than to consider bringing it back under the umbrella of the Home Office.
The Motion of the noble Lord, Lord Hunt, uses the wording of the Merits Committee report and is none the worse for that. It regrets that it is not clear from the IA or the Explanatory Memorandum how the findings from the consultation have fed into the development of the policy or the estimate of the costs and benefits of the changes. As far as I can see, that is not an opinion, but a fact.
In the most glaring case of a discrepancy between the responses to the consultation questionnaire and the statement, 85 per cent of the respondents disagreed with the proposal further to restrict students' paid work when there is no evidence that it has impaired their academic performance and when fee increases have made it much harder for students to pay their way. There are many other instances where significant minority responses have been overridden. The noble Lord, Lord Hunt, talked about the considerable uncertainties affecting student numbers and the costs and benefits laid out in the impact assessment, which I shall come to discuss in a few minutes.
As one would expect, more than three-quarters of English language school respondents disagreed with the proposal to require all tier 4 students to demonstrate level B2 English proficiency, a requirement which will be a major problem for many schools and private colleges of further education. The IA states that unless English language schools can attract either EU students or student visitor route applicants, they face going out of business. The replacement estimate of 80 per cent, to which the noble Lord, Lord Hunt, referred, is not only difficult to believe but pure guesswork. Schools say that a £1 billion industry is being put in jeopardy.
The Government have recognised the particular difficulties of the English language sector, however, by creating the extended student visa route, allowing
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In the past, some English language and FE colleges have been used as a way of gaining entry to the UK with the intention of working illegally. It would be useful to know whether the Minister has details of the attendance records of those admitted under the extended student visa route since it came into force on January 10, and if not, how else he is monitoring the new route. I hope that the bogus colleges have been eliminated since it was provided that overseas students could apply only to those schools which are accredited and the list of schools was reduced by some 90 per cent to 1,500, all of which are registered with the UKBA. But there may still be a residual problem with individuals who apply to a genuine college simply to gain entry. If so, what obligations do the colleges have to report unexplained absences to the UKBA, and are any statistics available on those absences as an indication of the use of education as a continuing route to illegal entry? I ask this question believing that the loophole has been finally closed, but it would be useful to have that reassurance from the Minister.
An additional problem has been created for the English language sector in that the Government suddenly decided at the end of July, without any consultation, that it was going to be subject to a new inspection regime in substitution for the one that has been operated-as far as I am concerned, perfectly satisfactorily -by the British Council for many years. This will be a monopoly handed to the Independent Schools Inspectorate, which has no experience or knowledge of the sector and intends to charge four times as much as the British Council has in the past. Since the BC/Accreditation UK inspection scheme is fit for purpose, which I ask the Minister to acknowledge, the right answer as proposed by the schools is that BIS and DfE should jointly designate the private further education sector as subject to regulation and approve BC/Accreditation UK as an inspection body under the powers of the Education Act 2002. Would my noble friend the Minister be kind enough to comment on that proposal? I shall ask him to address the overall problems of the sector that English UK has drawn to my attention, which are too numerous, complex and potentially disastrous to be covered adequately in this debate.
The rationale for the statement is clearly set out in the impact assessment: that too many migrants have been allowed to enter the UK and that the Government's aim is to reduce the level of net migration to sustainable levels. As students make up the majority of non-EU immigrants, yet we do not propose putting a limit on their numbers, we have to make it harder for student applicants to enter and harder to sustain themselves by working part-time while they are studying if they are not the brightest and best. Deterring students
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It has been said by the noble Lord, Lord Hunt, and my noble friend that no impact assessment was published for the previous statement of changes. The one that we are looking at today, although it does not say so, covers both this and the previous statement. Will the Government give an undertaking that Parliament will never again be asked to consider changes to the Immigration Rules unless we are provided with an IA?
The IA states that we need to filter out those who contribute least and who pose the highest immigration risk. There may be good reasons for the accreditation by Ofsted and its devolved equivalents of all tier 4 sponsors and for making them all highly trusted sponsors, as suggested in the IA, but are these changes in the statement? I do not see them either in the statement or in the Explanatory Memorandum. HTS accreditation costs £14,000, and I am told that all colleges, including those offering only the extended student visitor courses of up to 11 months not covered by tier 4, need to obtain this status in order to be considered favourably by applicants and their agents overseas.
I do not see, either, the changes in the English Language requirement mentioned on page 11 of the impact assessment, demanding B2 for undergraduates and above, and B1 for lower-level courses. Perhaps the Minister could point out where this is mentioned in the statement. There is enough paperwork to be digested in assessing the statement without the inclusion of text that refers to some other provision.
The estimates given for the reduction in student numbers and the costs and benefits arising from the changes in this statement and its predecessor, taken together, are subject to huge margins of uncertainty, as the noble Lord, Lord Hunt, pointed out. Increases in the levels of fees are bound to put off many applicants as well and the danger is that the combined effect of these increases and the present changes, together with increased competition from overseas, will seriously damage an industry that, according to an independent study for BIS, produces something like £14 billion of annual exports, potentially increasing to £26 billion in 2025. Reductions in the fee income from overseas students may undermine the high standards that we have always maintained in both higher and further education, driving students into the arms of our competitors and producing negative feedback-a threat not taken into consideration in the IA. Nor has account
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The Government's commitment to reducing immigration numbers, and their inability to attack other routes such as work or asylum, have led them to concentrate on education, relying on dodgy and unverifiable statistics and ignoring inconvenient responses to the consultation to arrive at conclusions already determined. I certainly hope that I am wrong in fearing the damage that may be caused by the measures that we are taking. I hope that my noble friend will be able to offer me an assurance that the Government will closely monitor the immediate effects of the changes in this and the previous statement on the higher and further education sector, and be prepared with remedial policies if it does turn out that we have impaired the contribution that they make to our economy by even more than the £2.4 billion we are already throwing away.
Lord Clement-Jones: My Lords, I should like briefly to add to the comments made by both my noble friends, with whom I am in total agreement. Indeed, I very much welcome today's debate. I declare an interest as chairman of the Council of the School of Pharmacy, University of London.
It is already very clear through this debate that the process and outcome of the consultation, impact assessment and change in the rules have been grossly unsatisfactory. Although it was rather strange, I suppose that the qualified welcome given by some institutions to the March statement by the Home Secretary and the attendant statement of intent was explained by the fact that many in higher education were expecting worse. However, that does not mean that any of them are by any manner of means in agreement with the current state of play.
I want to talk, in particular, about the closure of the post-study work route visa, on which I have asked quite a number of questions over the past two years. The Government's response to the Home Affairs Select Committee and correspondence to me from the immigration ministry are interesting in that they show that the Minister and the Home Office seem to have greatly underestimated the importance of the post-study work aspect of coming to a United Kingdom university.
As vice-chairman of the All-Party Parliamentary China Group, I have had a great deal of contact over the years with Chinese students in particular. I believe that some 80,000 to 100,000 students from China are here at any one time. The opportunity to undertake what is essentially an internship with a UK business after graduating, to prepare for a career back in China, has played a very important part in the decision by Chinese students to come here. In the response to the Home Affairs Select Committee report, the Minister said:
However, that completely misunderstands the reason for the post-study work route visa. It is a route to having brief work experience here in the UK and thereafter to working long-term back in the home country with the skills acquired.
The tier 2 route visa will be granted only on a case-by-case basis. If we were able to unpack the responses to the consultation, which we are not, I am sure that a better solution could easily be found-certainly looking at the evidence to the Home Affairs Select Committee-to tighten up the PSWR mechanism under tier 4. That would be much more satisfactory. As it is, it will make our higher education institutions much less attractive to overseas students. As we know, and as has been mentioned by all speakers so far, the impact assessment for the new rules came out extremely late in a very unsatisfactory fashion. That, as we also know, was commented on by the Merits Committee on two occasions, and we now know that some £3.5 billion gross of income and economic activity could be at risk as a result. That potentially has a huge impact on our education sector and it puts that sector considerably at risk on the basis of little evidence of abuse of the post-study work route visa.
It is right to say, as the Merits Committee does, that it is not clear from the impact assessment or the Explanatory Memorandum to the June statement how the findings from the consultation have fed into the development of the policy or the estimates of the costs and benefits of the changes. I think that that is an entirely uncontroversial statement in the light of what we have heard today. That is despite the statement in paragraph 8.1 of the statement of changes. As we know, the consultation was rushed through in only a month, which itself was grossly unsatisfactory and, sadly, these new rules have taken effect in those circumstances. It is vital that the new rules are kept under review and I hope that the Minister can give an undertaking that that will happen after a very short period of operation. It would have been better if these rules had not gone through but, on the basis that they have, I very much hope that the Minister can give an undertaking that such a review will take place.
The experience of Australia is an extremely salutary lesson in these circumstances. When the Immigration Rules were changed, as the Home Affairs Select Committee reported, there was a slump in applications from overseas to Australian universities, from which they are still recovering.
Finally, the Home Affairs Select Committee report, which is an extremely good document, said that the committee members were not persuaded that students are migrants. The Minister, in his reply to the report, said that he disagreed, claiming that the definition was long-standing under UN measures. That does not make it right. It is high time that rationality prevailed and that students are not regarded as migrants unless they are here for the longer term after graduating.
Earl Attlee: My Lords, I thank the noble Lord, Lord Hunt, for the opportunity to debate this Motion. A large number of points have been raised. I am eager to deal with the issues to which they give rise but clearly I shall have to deal with most of them in writing, as noble Lords have been quite wide-ranging.
The Motion before us deals with changes to tier 4 of the immigration system covering international students. The issue at hand is how the findings from the consultation have fed into the development of the policy and the estimates of the costs and benefits of the changes.
When the noble Lord, Lord Hunt, started, he told us about the importance of overseas students. He is, of course, quite right and I absolutely agree with him, but only in respect of genuine students who have come here to study at our world-class academic institutions. That is why we are devoting our attention particularly to the private education sector, where there is much abuse, although we are doing well to reduce it. However, I am at one with the noble Lord regarding universities. He will know that they enjoy considerable advantages under our policies. For example, we have introduced flexibility into universities on the English language requirements, on the ability to work and on the ability to bring in dependants.
The noble Lord, Lord Hunt, talked about loss of income from the UKBA. Although there will be a reduction in fees paid to the UKBA, the agency has made allowance for this in its business planning. I hope that he agrees that the UKBA exists to keep our borders secure and not just to turn over visa fees. He claimed the credit for the previous action to deal with bogus students but the previous Government only started that and left this Government with considerable work to do.
"The Committee regrets that it is not clear from the IA or the Explanatory Memorandum how the findings from the consultation have fed into the development of the policy or the estimates of the costs and benefits of the changes".
Your Lordships will recall that the House debated the first set of changes to the student route on 16 May. At that time, the impact assessment for the student changes had not been published. However, the impact assessment for the changes to the student route was published when we made the second set of changes on 13 June. I reiterate my previous reassurance that we are quite clear that it is right and proper to provide the Merits Committee with the information necessary for it to do its job.
However, the issue having been raised, it would be remiss of me not to put this again in the context of the previous practice in this area. While it is generally accepted as good practice, there is no legal obligation for the UKBA to consult on changes to the Immigration Rules. In March 2010, the previous Government made significant changes to tier 4-the student route-without a formal public consultation. Despite taking the views of key partners, they did not publish any formal explanation of the findings. Similarly, in March 2006, following consultation, the previous Government published their policy for a points-based system but did not publish the 517 consultations that they received.
I am satisfied that this Government have gone to great lengths to seek the views of the public and of the sector, and to take account of these views in developing our final policy. On 23 November 2010, the Home Secretary informed Parliament that she intended to hold a public consultation on reforming the student
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Our consultation received over 30,000 responses-10 times as many as the consultation on economic routes-and officials spoke to representatives of over 200 institutions during the consultation period. On 22 March, the Home Secretary made a full statement in the other place setting out the detail of the Government's decisions, and the public reaction and data that had informed those decisions. On 31 March, we published a detailed statement of intent describing the full policy package and lay changes to the Immigration Rules to implement the first changes resulting from the consultation, which came into effect on 21 April. On 13 June, we lay the second set of changes to the Immigration Rules and published the impact assessment.
It is true that, like the previous Government, we have not published every consultation response. As I mentioned, there were over 30,000 responses online and over 200 longer written responses. We published a summary of the online responses to all questions asked and answered in the consultation. We also indicated the level of support in relation to every response. We felt that this was helpful information for Parliament and interested parties to have. The government code of practice on consultations states that:
"Following a consultation exercise, the Government should provide a summary of who responded to the consultation exercise and a summary of the views expressed ... Consideration should be given to publishing the individual responses received",
The level of response demonstrates a high level of public engagement with the policy development processes. The changes that we have made to our final policy show that we have genuinely listened to and taken account of the views expressed. For example, we initially proposed raising the minimum level of English to an upper immediate level and required secure English language tests for all students. This received a clear, negative response from institutions, who indicated that pre-university pathway courses provided a vital route for international students to access our world-class universities.
We initially proposed that all students should have to return overseas on completion of their course. Some 92 per cent of respondents disagreed with that proposal and the final policy instead puts a maximum limit on the time students can spend in tier 4. We proposed a wide reform of students' permission to work and again received significant negative feedback, with 85 per cent of respondents against the proposals. Instead, we have retained the previous system in the most compliant sectors while removing permission to work in those sectors where we account the most abuse.
The impact assessment shows that we expect the full set of reforms to lead to a cumulative net reduction of around 230,000 migrants to the end of this Parliament, 2011-15. Once all changes have been implemented in 2013, we expect a reduction in net migration numbers of around 60,000 a year. However, it is important to note there is not a one-to-one relationship between the number of visas issued and the level of net migration. The volume of visas is larger as it includes students coming to study for less than 12 months.
Once the system is fully implemented, we estimate that there will be around 70,000 fewer student visa grants a year and around 20,000 fewer visas issued to dependants each year. In addition, closing tier 1 post-study work in April 2012 but retaining a route into skilled, sponsored employment through tier 2 should result in 20,000 fewer each year staying in the UK to work. As a result of the transitional and full effects of the policy, we estimate that there will be around 260,000 fewer student visas granted and around 100,000 fewer visas issued to dependants-a total of 360,000 fewer by the end of this Parliament. In addition, closing tier 1 post-study work in April 2012 but retaining a route into skilled, sponsored employment through tier 2 should result in 80,000 fewer staying in the UK to work but with 25,000 fewer dependants by the end of this Parliament in 2015.
On costs and benefits, the noble Lord, Lord Hunt, referred to the financial considerations. The impact assessment shows that the changes are estimated to have a net cost of £2.4 billion to the UK economy. We estimate that the policy proposals will lead to £1.1 billion of benefits but £3.6 billion of costs, of which £840 million is savings to public services. However, the noble Lord will be aware that a significant proportion of this impact results from less work being done by students, post-study workers and their dependants, whether this work is legitimate or not. The impact would be lower if some of this work is instead done by non-migrant workers. We have commissioned the Migration Advisory Committee to look into this. The MAC has access to the appropriate economic expertise. In the mean time, we have costed a worst-case scenario.
The institutions that will no longer be able to recruit migrants will lose fee income but our view is that the policy strikes the right balance between support for British educational institutions and the need to reduce migration to manageable levels and cut out abuse of the student route. The committee has recognised the difficulty in estimating likely costs and benefits. The impact assessment drew from a range of sources but did not specifically draw on the consultation responses. Other, more established data sources were used as they were more likely to be representative of a diverse sector.
I would not want the House to think we are dismissive of the Merits Committee's comments. The Merits Committee provides an invaluable service to Parliament and the public, and we have taken on board its comments in the spirit in which they are intended. I reassure the chairman, my noble friend Lord Goodlad, that the Home Office will always be happy to provide the committee with more information wherever it is possible and reasonable to do so. Ministers will work hard to ensure that that happens.
The noble Lord, Lord Hunt, asked how the consultation responses were incorporated into the students' IA. Very few of the consultation responses provided information directly relevant for the numbers in the impact assessment. Most responses focused on the policy itself. Of those that did, they either confirmed the uses of sources already used or were judged to be unrepresentative of a diverse sector.
The noble Lord suggested that the numbers differed from the Government's earlier estimates. There are indeed differences between reductions in net migration and reductions in visas. We estimate that in 2013, once all changes have been implemented, there will be a reduction in net migration of around 60,000 a year. For the same year, we estimate a reduction in visas and in-country grant of around 70,000 for students, 20,000 for post-study workers and 30,000 for dependants.
My noble friend Lady Hamwee asked about low-risk countries. The UK Border Agency does not base decisions on the nationality of the applicant. All applicants are judged against objective measures. Low-risk nationals are given a streamlined process, but the underlying criteria remain unchanged.
My noble friend Lord Avebury asked about student visitor extension to 11 months and whether this creates a loophole. The student visitor is a secure route. The UK Border Agency officials, both overseas and in the UK report, retain the right to refuse any student visa application on credibility grounds. If they believe that the applicant does not genuinely intend to study-and we will monitor closely the numbers of students making use of this extension-they will take action at signs of abuse. We plan to decide the future of the route once it has been operating for 12 months.
My noble friend Lord Avebury reminded us that fee increases made it hard for students to make ends meet, or words to that effect. However, he will be aware that overseas students are expected to be able to provide for themselves without working. Paid work is only to supplement this and to give them experience of UK life.
My noble friend also asked why we are asking the QAA and the Independent Schools Inspectorate to inspect private colleges, and whether we will reinstate the British Council or Accreditation UK. We did consult on a new inspection regime. Under tier 4 we have seen that the level of compliance has been closely aligned to the type of institution, with far higher rates of abuse to be found in the privately funded sector, with up to 26 per cent of students found to be non-compliant in one study. The previous system was based on accreditation by sector bodies, and this has proved to be inadequate. Therefore we are moving to a system of more rigorous inspection carried out by fully independent bodies that have previously inspected the sectors with the highest levels of compliance, namely the public-funded providers and independent schools. The ISI's framework and standards have been scrutinised by Ofsted to ensure that they are appropriate and rigorous. We do not plan to reinstate Accreditation UK or the other accreditation bodies.
Noble Lords have made several other points. As I have already indicated, I will respond to them in writing. I reiterate that the Government have gone to great lengths to seek the views of the public and the sector, and to take account of those views in developing our final policy. In the light of this thorough approach to consultation and an explanation of our calculations, I hope that the noble Lord, Lord Hunt, will feel able to withdraw his Motion.
Baroness Hamwee: My Lords, I wonder if the noble Earl could clarify-if not now, then at a later time-the basis of the use of the responses to the consultation. I was not entirely clear whether he was saying that it was factual information that was not used, and that other sources were used, or whether it was something wider than that.
First of all, I echo the point made by the noble Baroness, Lady Hamwee, about the work of the Merits Select Committee, of which she is a distinguished member. It is very difficult for noble Lords to go through all the statutory instruments and statements of changes, and without the Committee we would be in a very difficult position as far as parliamentary scrutiny is concerned. Essentially this debate is about two issues. One is parliamentary process and the information provided by the Home Office; and it is also about the policy. On the issue of parliamentary process, it is very important that the Home Office learns lessons from the way in which this statement and previous statements have been produced for when further changes in Immigration Rules are brought before your Lordships' House.
The noble Lord, Lord Avebury, has said that this is not the first such occasion, and indeed it is not. We come back consistently to this House to debate these changes because of the inadequacy of the department's approach. The noble Earl said that his department readily takes on board the points made by the Merits Select Committee, but so far it has not. We continuously come back to debate these issues because the Merits Select Committee has identified inadequacies in his department's approach. I have very little confidence that we will not be back in another few weeks with further discussion on the same basis.
The noble Earl has kindly offered to write to noble Lords on points to which he has not responded-he always does and it is appreciated-and I hope that his department will take this to heart. I thought it was very interesting when the noble Baroness, Lady Hamwee, said that the problem with the IA was that it only had two options: the do-nothing option, or the option of taking what the Home Office wants to do. Rather surprisingly, the Government have come to the view that the Home Office got it right in the first place. I am sure that we are all reassured that, after rigorous consideration of the Home Office's original proposals, they have indeed, through the IA, come to the view
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I too would pay tribute to the ILPA. I thought that the briefing paper it produced for us was, as ever, very comprehensive. Very interesting were the examples that it gave of people who would be badly affected by these proposals and changes. I hope that the noble Earl will have some time to have a look at these examples, because I think that they bring home to us how these changes can have a real impact on people from other countries.
The noble Lord, Lord Avebury, spoke about the impact of English language schools, and I agreed with everything that he said. I thought that he put a very pertinent point to the noble Earl about the proposal to change from the accreditation scheme to the monopolistic provider that is now going to be provided in relation to inspection, which will be very expensive indeed. The noble Earl gave the reasoned response that he thought this was going to be a more effective and more rigorous scrutiny. I hope that the noble Lord, Lord Avebury, might feel able to bring this back in some form because I think that it warrants further debate. I am particularly worried about the monopolistic issue and the cost, and I hope that there will be an opportunity to debate this further in due course.
I very much agreed with the noble Lord, Lord Clement-Jones, who spoke from his experience of the School of Pharmacy. My experience is particularly in the health field. Throughout the world we have wonderful contacts with healthcare systems in other countries, and it is because we have always had this marvellous open door, with people from other countries who often come to help the NHS. My fear is that it is not just the change in the rules that will make a difference but the change in the atmosphere; people from other countries will get the feeling that they are no longer wanted here to study, and that is a major concern.
I also agreed with the noble Lord, Lord Clement-Jones, about the post-study work visa. It is part of a package. This does impact on the brightest and the best, however we define them-that if they are able to undertake some work experience before they go home, it is extremely valuable to them. If they cannot, it actually undermines the qualification that they receive in the UK. I cannot see the problem in them being able to undertake some work experience. It is not that they are taking away work from indigenous members of the population; it is simply that it is part of the package. I have met many of these students and I know that they are not seeking to abuse the system by staying on here and working. It is essentially part of the credibility of the educational package that is on offer.
On dependants, I have met many of the mature students. They are not students in our terms; they are not 18 year-olds, but mature people who often have partners and families. We need to be somewhat more sympathetic to their needs. Why should it be a matter of concern if they bring dependants with them while they study on these courses?
Lord Hunt of Kings Heath: Yes, my Lords, but surely the point is to deal with the abuse in a holistic way and not stop legitimate people coming here. I fear that the changes will have that dampener impact. I really do.
On the question of consultation, I, like the noble Baroness, was rather confused by the Minister's response. The Government seem to dismiss these responses because they commented on the policy or because they were unrepresentative. I do not know who decided that they were unrepresentative; it is almost as if the Government have decided that anyone who does not like the policy should not be listened to because they are unrepresentative. I just point out to him-and I am indebted to my noble friend Lord Rosser for referring to this-that the Merits Committee in paragraph 10 says that the committee very much regrets the lack of information and how the findings from the consultation fed into the conclusions and estimates that the Government have made. As the committee says,
If you are commenting on the general policy, I would have thought that you were actually talking about the main advantages and disadvantages of the changes. That really gives the game away. The fact is that all those legitimate organisations involved in education know that this has been a disastrous change in policy; they told the Government that and the Government take no notice. No wonder they have not fed that into the results of this statement of changes.
This has been a thoroughly good debate. Once again, the Government have found themselves rather lonely on this policy. That is because this policy is wrong and highly damaging to this country. I of course withdraw the Motion, but I hope that the Government will listen to what noble Lords have said tonight.
(a) an enfranchisement right is not exercisable in relation to dwellings owned (whether freehold or leasehold) by a community land trust as defined in section 79 of this Act, or
(b) the exercise of an enfranchisement right in relation to that land is subject to modifications provided for by the regulations.
(a) the right under Part 1 of the Leasehold Reform Act 1967 to acquire the freehold of a house (enfranchisement),
(b) the right under Chapter 1 of Part 1 of the Leasehold Reform, Housing and Urban Development Act 1993 (collective enfranchisement in case of tenants of flats), and
(c) the right under section 180 of the Housing and Regeneration Act 2008 (right to acquire social housing).
(a) confer discretionary powers on the Secretary of State, a community land trust or any other specified person, and
(b) require notice to be given by a community land trust in any case where, as a result of the regulations, an enfranchisement right is not exercisable or is exercisable subject to modifications.""
Lord Best: My Lords, this amendment is about community land trusts and enfranchisement. Community land trusts acquire land from benevolent landowners or public bodies with a social concern free of charge or at a much reduced price. They then build homes for renting and shared ownership using the cheap or free land as the subsidy that makes the homes affordable. This means that they can keep the homes as affordable to those on modest incomes for present and future generations. They are very local, although they may use a housing association to help them; they work with the planners, the parish council, the landowner and volunteers. Very often they are self-help organisations in which future residents play a major part.
The community land trusts are real big society stuff. However, they have a problem in relation to the Leasehold Reform Act 1967, which entitles the occupier to acquire the freehold and remove thereby the opportunity for others in future to benefit from the initial gift or concession on the land price. Similarly, the right to acquire under the Housing and Regeneration Act 2008 can remove the property from its original purpose. This amendment seeks to protect the homes built through community land trusts from legislation that can undermine the whole basis on which they are set up to operate. It is not a denial of rights of tenants or shared owners, because those moving in are very willingly, indeed enthusiastically, signing up to getting homes that they could not otherwise afford. They do so in the full knowledge that they will benefit from the excellent accommodation, but any capital gains that they might make will not include the appreciation of the land value.
The community land trust approach, which is being used in east London as part of the Olympic legacy measures, as well as in rural areas, where benevolent landlords are making land available on highly beneficial terms, deserves our support. Removal of the enfranchisement arrangements, which were never intended to cover circumstances of this kind, seems essential to secure their future. Homes developed under the community right to build, of which I am also very supportive, will have the benefit of an exemption from the leasehold enfranchisement arrangements. This amendment would give the same exemption to community land trusts. I understand that the National CLT Network
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I know that Ministers are supportive of the community land trust approach and I assure them that acceptance of an amendment along these lines would be enormously important and greatly appreciated by all the supporters of this excellent way of creating affordable housing and guaranteeing its affordability in perpetuity. I beg to move.
Lord McKenzie of Luton: My Lords, I thank the noble Lord, Lord Best, for introducing this amendment and for his description of the Community Land Trusts approach. We have a good deal of sympathy with the thrust of this because we have seen the benefit of the Government's reply to the amendment in the document they issued in August. Of course, this was one of the amendments that was withdrawn at the last stages of Committee.
As we have heard, these powers seek to replicate provisions already in the Bill relating to community right to build orders. The amendment seeks to remove enfranchisement rights in respect of dwellings owned by CLTs, and enfranchisement rights give leaseholders the right to acquire freeholds in certain circumstances-legislation, as the noble Lord referred to, that was started by the Leasehold Reform Act 1967, but I think those opportunities have been greatly extended since.
As I understand it, the gist of the Government's position appears to be that CLTs do not necessarily have the same level of community engagement as bodies do under the community right to build provisions, which are proposed by the community, supported by the community, subject to a community referendum. However, where the CLT does satisfy the level of community engagement, it will be able to apply for a community right to build order and thereby obtain the benefit of disapplication of enfranchisement rights. But I am bound say, therefore, that I am not sure why, where there are circumstances that permit this, they could not be described in the prescribed circumstances that the noble Lord is seeking in his amendment. Proposed subsection (1) says,
I think that the noble Lord makes a good point about referendums in relation to community right to build orders. In circumstances where there is clearly a very high degree of support for a project, why indeed put the project through the process, cost and challenges that this entails? It does appear that one way or another there is a route to the result that the noble Lord is seeking, which is all well and good, and I agree that we should not be seeking to remove enfranchisement rights lightly-these are important rights. I think that he has described fully why they should be removed in these sorts of circumstances.
I therefore support the thrust of the noble Lord's amendment. I believe that they should not be forced through the community right to build process just to achieve the outcome here and that it could be dealt with by regulations that, as his amendment suggests, fully cover the situation.
Earl Attlee: My Lords, enfranchisement rights are an established and significant right, and removing them must not be undertaken lightly. We expect to use the community right to build powers to ensure that the enfranchisement rights are only removed where the proposal is by the community, for the community and has the backing of the community through a community referendum, as identified by the noble Lord, Lord Best.
I understand that the regulation-making power provided for by the amendment is expected to be used to disapply enfranchisement rights simply where a CLT is the landlord of the property. There is, however, no requirement for a CLT to be made up of members of the community and there is no requirement for a community referendum. This means that a CLT development may not be proposed or supported by the community. I am afraid that the removal of these significant rights cannot be justified. The design of the community right to build will allow the majority of CLTs to apply for a community right to build order. As such, they will be able to benefit from the disapplication of enfranchisement rights under a community right to build order, again as explained by the noble Lord, Lord Best. With these reassurances, I hope that the noble Lord is willing to withdraw his amendment.
Lord Best: I am willing to withdraw the amendment but I am not entirely reassured. The removal of rights implies that the people moving in believe themselves to have earned new rights-the right to enfranchise and make capital gains-which is entirely contrary to the position that they in reality face. They know that they are entering this scheme, acquiring an affordable home that they could never possibly afford otherwise, and the terms are that they will not gain from the capital growth in the value of the property. That is a very fair deal for them to be part of, and I do not think that it is a removal of rights to say that they cannot enfranchise thereafter. It is a willingly-entered-into arrangement. So, although at this late hour I am very happy to withdraw this amendment, I am not entirely reassured by the noble Earl's reply, for which I am grateful, as I am for the support from the noble Lord, Lord McKenzie.
In Schedule 1 to the Housing and Regeneration Act 2008 (the Homes and Communities Agency), after sub-paragraph (1)(a) of paragraph 11 insert-
"(aa) state within the report, in particular, the total number of new properties delivered during each year, also specifying, in respect of new properties in the area of each local housing authority-
(i) how many are located within a settlement of fewer than 10,000, and fewer than 3,000, inhabitants;
(ii) the number let on long leases, fixed-term shorthold tenancies, and periodic tenancies;
(iii) levels of rent;
(iv) the number designed for use as housing for older people;
(v) the number designed for use as housing for other vulnerable groups;
(vi) the size as defined by the number of bedrooms;
(vii) information on such other categories as may appear to the HCA to be appropriate or may be specified by the Secretary of State.""
Lord Kennedy of Southwark: My Lords, my amendment is quite simple and seeks to place an obligation on the Homes and Communities Agency to produce certain information in its annual report. All the information, I understand, is available, some I accept is already published at least every year, and in some cases at least every six months. Having said that, I do not accept that this would be an unmanageable burden or that it is unnecessary or inappropriate to require the agency to produce such information in its annual report. I would contend that this is just the sort of information that the HCA should be including in their annual report. It is also valuable in the review document for the organisation that they clearly detail the number of new properties they have delivered on, what the level of rents are and who they are serving.
This amendment was tabled in Committee but not taken. If the noble Earl is not minded to accept it, in what other ways will the Government ensure that this important information gets out there? While it is one thing to say that the information is already out there, if you are not sure where it is, how it is collected or where it is located in the first place-or whether it is in a number of different places-then getting all the information, making comparisons and being able to comment with an informed mind becomes much more difficult. I beg to move.
Earl Attlee: My Lords, the noble Lord described his amendment as simple; experience shows that simple amendments can sometimes be the most dangerous. The information that this amendment would require to be included within the annual report is either reported on already or is available to members of the public, should they request it. For example, information on the total number of homes delivered each year is provided in the HCA's official statistics, which are
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I do not believe that it is necessary to prescribe in statute that these specific information requirements are included in the HCA's annual report when the information is either already being collected and reported on or can be made available through existing channels. For these reasons, I hope that the noble Lord will withdraw his amendment.
Lord Kennedy of Southwark: My Lords, I thank the noble Earl for his response. Again, we are not going to agree on this. I am very worried that sometimes if the information is out there but you cannot find it or do not know where it is, there is an issue. People should be able to use and comment on it. Having said that, in this case I am prepared to withdraw the amendment.
In section 13(1) Landlord and Tenant Act 1985 (leases to which the provisions about repairing obligations in section 11 of that Act apply) after subsection (1) insert-
"(1A) Section 11 also applies to any lease of a dwelling house granted on or after the day on which section 173 of the Localism Act 2011 came into force, for a term of less than 21 years.
(1B) Section 11 also applies to a right of occupation given by contract or any enactment and not amounting to a lease as if the right were a lease; and "lease" and cognate expressions shall be construed accordingly.""
Lord Shipley: My Lords, in moving Amendment 84 I shall also speak to Amendments 86 to 90. These all relate to the standards of accommodation and repairing obligations. Amendment 84 will ensure that all tenants and other occupiers of housing with short terms have the benefit of repairing obligations. The Landlord and Tenant Act 1985 provides that the implied repairing obligations set out in its Section 11 only apply to leases of less than seven years. This Bill proposes to apply that Section 11 to secure and assured fixed-term tenancies of more than seven years to take account of the fact that the new, flexible tenancies may be granted for longer than seven years. The proposed new clause in my Amendment 84 gives all the tenants of all short leases of less than 21 years the benefit of implied repairing obligations, so this amendment is important.
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